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Dr Faizuniah Pangil
Dr Fais Ahmad
Dr Ooi Yeng Keat
Hanissah A Razak
Naslina Zakaria
Zulkufli Aziz
Ruhana Busu
Assoc Prof Dr Husna Johari

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Project Directors: Prof Dato Dr Mansor Fadzil
Prof Dr Wardah Mohamad
Open University Malaysia

Module Writers: Dr Faizuniah Pangil

Dr Fais Ahmad
Dr Ooi Yeng Keat
Hanissah A Razak
Naslina Zakaria
Zulkufli Aziz
Assoc Prof Dr Husna Johari
Universiti Utara Malaysia

Ruhana Busu
Universiti Putra Malaysia

Moderators: Ruhana Busu

Universiti Putra Malaysia

Prof Dr Shaari Abd Hamid

Prof Dr Wardah Mohamad
Open University Malaysia

Developed by: Centre for Instructional Design and Technology

Open University Malaysia

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Lot 47-48, Jalan SR 1/9, Seksyen 9,
Jalan Serdang Raya, Taman Serdang Raya,
43300 Seri Kembangan, Selangor Darul Ehsan

First Edition, December 2007

Second Edition, December 2010
Third Edition, December 2013 (rs)

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All rights reserved. No part of this work may be reproduced in any form or by any means
without the written permission of the President, Open University Malaysia (OUM).

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Table of Contents
Course Guide xiii xviii

Topic 1 Introduction to Organisational Behaviour 1

1.1 Manager and Organisation 2
1.1.1 Functions of a Manager 2
1.1.2 Roles of a Manager 3
1.1.3 Managerial Skills 5
1.2 The Definition of Organisational Behaviour 6
1.3 Disciplines that Contribute Towards Organisational
Behaviour 7
1.4 Challenges and Opportunities in Organisational
Behaviour 8
1.4.1 Managing Globalisation 9
1.4.2 Managing a Diverse Workforce 10
1.4.3 Managing Changes in Technology 10
1.4.4 Managing Ethics 11
1.4.5 Managing Downsizing 12
1.5 Organisational Behaviour Model 13
1.5.1 Dependent Variables 14
1.5.2 Independent Variables 15
Summary 18
Key Terms 19

Topic 2 Individual Differences 20

2.1 Individuals Personal Characteristics 21
2.2 Capabilities 23
2.3 Learning 24
2.3.1 Learning Theories 25
2.4 Personality 26
2.4.1 Factors Determining Personality 27
2.4.2 Personality Traits 28
2.4.3 Other Personality Traits that Affect
Organisational Behaviour 29
2.5 Perception 32
2.6 Factors Influencing Perception 33
2.6.1 Perceiver 34
2.6.2 Target 34
2.6.3 Situation 35

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2.7 Judging Others 35

2.7.1 Attribution Theory 36
2.7.2 Fundamental Error in Attribution 37
2.7.3 Self-serving Bias 37
2.8 Short Cuts to Assessing Others 38
2.8.1 Selective Perception 38
2.8.2 Halo Effect 39
2.8.3 Contrast Effects 39
2.8.4 Projection 40
2.8.5 Stereotyping 40
Summary 42
Key Terms 43

Topic 3 Values, Emotions Attitudes and Job Satisfaction 44

3.1 Values 45
3.1.1 Types of Values 45
3.1.2 Inter-cultural Values 47
3.2 Emotions 48
3.2.1 Major Emotions and Their Subcategories 49
3.2.2 Types of Emotions: The Positive and Negative
Emotions 49
3.2.3 Managing Emotions 50
3.3 Attitude 51
3.3.1 How We Acquire Attitudes 52
3.3.2 Attitude and Study of Organisational Behaviour 53
3.4 Job Satisfaction 54
3.4.1 Determinants of Job Satisfaction 54
3.4.2 How Job Satisfaction Affects Organisational
Behaviour 56
Summary 59
Key Terms 60

Topic 4 Motivation and Job Design 61

4.1 Theories of Motivation 62
4.1.1 Early Theories of Motivation 62
4.1.2 Contemporary Theories of Motivation 66
4.2 What Motivates Employees to Perform? 79
4.2.1 The Job Characteristics Model (JCM) 80
4.2.2 Workplace Environment 83
4.3 Job Design Alternatives 85
4.3.1 Job Rotation 86
4.3.2 Job Enlargement 86

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4.3.3 Job Enrichment 86

4.3.4 Team-based Designs 86
4.4 Alternative Work Schedule 87
Summary 90
Key Terms 91

Topic 5 Work Stress 92

5.1 Definition of Stress 93
5.2 Types of Stress 94
5.3 Sources of Stress 95
5.3.1 Environmental Factors 96
5.3.2 Organisational Factors 96
5.3.3 Individual Factors 97
5.4 Individual Differences 97
5.5 Individual and Organisational Consequences of Stress 98
5.5.1 Individual Consequences 98
5.5.2 Organisational Consequences 99
5.6 Managing Stress 100
5.6.1 Individual Approaches 100
5.6.2 Organisational Approaches 101
Summary 104
Key Terms 104

Topic 6 Groups and Teams 105

6.1 Definition and Classification of Groups 107
6.1.1 Stages in Group Development 110
6.1.2 Alternative Model: Punctuated Equilibrium
Model 113
6.1.3 Group Behaviour Model 115
6.1.4 External Conditions Imposed on Groups 115
6.1.5 Resources for Group Members 117
6.1.6 Group Structure 118
6.1.7 Group Processes 121
6.1.8 Group Task 122
6.1.9 Implications of Group Models to Managers 122
6.2 Understanding Groups and Teams 123
6.2.1 Types of Teams 125
6.2.2 Creating Effective Teams 128
6.2.3 Work Design 128
6.2.4 Composition 129
6.2.5 Context 132
6.2.6 Process 133

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6.2.7 Turning Individuals into Team Players 135

6.2.8 Contemporary Issues on Teams 138
6.3 Individual and Group Decision Making 140
6.3.1 Individual Decision Making 140
6.3.2 Individual Differences: Decision-making Styles 145
6.3.3 Individual Barriers 147
6.3.4 Organisational Barriers 147
6.3.5 Cultural Differences 149
6.4 Group Decision Making 149
6.4.1 Advantages of Group Decision Making 149
6.4.2 Disadvantages of Group Decision Making 150
6.4.3 Techniques of Group Decision Making 152
6.5 Value of Individual versus Group Decision Making 154
Sumamry 156
Key Terms 157

Topic 7 Leadership 158

7.1 Leadership and Its Features 159
7.1.1 Individuals Personal Characteristics 160
7.1.2 Individuals Expertise 160
7.1.3 Formal Position (Post/Role) 160
7.1.4 Reward 161
7.1.5 Coercion 161
7.2 Leaders and Managers 161
7.3 Theories Related to Leadership 162
7.3.1 Trait Theory 163
7.3.2 Behaviour Theory 164
7.3.3 Contingency Theories 167
7.3.4 Neo-charismatic Theories 173
7.4 Emerging Leadership Perspectives 177
Summary 181
Key Terms 182

Topic 8 Communication 183

8.1 Functions of Communication 184
8.2 Communication Process 185
8.2.1 Communication Process Model 186
8.2.2 Barriers to Communication 187
8.3 The Basics of Communication 191
8.3.1 Direction of Communication 191
8.3.2 Formal and Informal Channels 193
8.3.3 Non-verbal Communication 197
8.3.4 Choice of Communication Channel 199

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8.4 Overcoming Communication Barriers 200

8.5 Contemporary Issues in Communication 201
Summary 207
Key Terms 208

Topic 9 Organisational Structure and Culture 209

9.1 Defining Organisational Structure 210
9.1.1 Job Specialisation 211
9.1.2 Departmentalisation 211
9.1.3 Chain of Command 213
9.1.4 Span of Control 214
9.1.5 Centralisation and Decentralisation 214
9.1.6 Formalisation 215
9.2 Common Organisational Designs 216
9.2.1 The Simple Structure 216
9.2.2 The Bureaucracy Structure 216
9.2.3 The Matrix Structure 217
9.3 New Organisational Design Alternatives 218
9.3.1 The Team Structure 218
9.3.2 The Virtual Organisation 218
9.3.3 The Organisation without Boundaries 219
9.4 Why are Structures Different? 220
9.4.1 Organisation Strategy 221
9.4.2 Organisation Size 222
9.4.3 Technology Used 222
9.4.4 Organisational Environment 223
9.5 Organisational Culture 224
9.5.1 What is Organisational Culture? 224
9.5.2 Layers of Cultural Analysis 224
9.5.3 Characteristics of Organisational Culture 225
9.5.4 Categories of Culture 227
9.5.5 Understanding Other Categories of Cultures 228
9.5.6 Functions of Culture 230
9.5.7 Culture as a Liability 231
9.5.8 Creating and Sustaining Culture 233
9.5.9 Learning a Culture 236
Summary 238
Key Terms 239

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Topic 10 Power, Politics and Conflicts 240

10.1 Definition of Power 241
10.2 Dependence 242
10.3 Power Tactics 244
10.4 Political Behaviour in Organisations 246
10.4.1 Factors Contributing to Political Behaviours 248
10.5 Conflict Concept 250
10.5.1 Definition of Conflict 250
10.5.2 Levels of Conflicts 250
10.6 Conflict Perspective 252
10.6.1 Traditional View 252
10.6.2 Human Relations View 252
10.6.3 Interactionist View 252
10.7 Functional Conflict versus Dysfunctional Conflict 253
10.8 Conflict Process 255
10.8.1 Stage I: Potential for Conflict or Incompability 255
10.8.2 Stage II: Cognition and Personalisation 257
10.8.3 Stage III: Intention 258
10.8.4 Stage IV: Behaviour 260
10.8.5 Stage V: Effects 262
Summary 264
Key Terms 265

Topic 11 Organisational Change 266

11.1 Forces for Change 267
11.1.1 Changes in Workforce 267
11.1.2 Changes in Technology 268
11.1.3 Changes in Competition 268
11.1.4 Changes in Social Trends 269
11.1.5 Changes in World Politics 269
11.1.6 Changes in Mandated Pressures 270
11.2 Types of Change 270
11.3 What Can be Changed? 271
11.3.1 Structure 272
11.3.2 Technology 272
11.3.3 Physical Arrangement 272
11.3.4 Employees 273
11.4 Resistance to Change 273
11.4.1 Individual Resistance 274
11.4.2 Organisational Resistance 275

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11.5 Overcoming Change Resistance 276

11.5.1 Training and Communication 277
11.5.2 Involvement 277
11.5.3 Negotiation 277
11.5.4 Manipulation 277
11.5.5 Coercion 277
11.5.6 Facilities and Support 278
11.6 Managing and Implementing a Planned Change 278
11.6.1 The Goals of Planned Change 279
11.6.2 Change Agent 279
11.7 Change Management Approach 279
11.7.1 Lewin's Three-step Model (Lewins
Change Model) 280
11.7.2 Action Research 281
11.7.3 Organisational Development 282
11.8 Sustaining Change 285
Summary 288
Key Terms 288

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You must read this Course Guide carefully from the beginning to the end. It tells
you briefly what the course is about and how you can work your way through
the course material. It also suggests the amount of time you are likely to spend in
order to complete the course successfully. Please keep on referring to the Course
Guide as you go through the course material as it will help you to clarify
important study components or points that you might miss or overlook.

BBGO4103 Organisation Behaviour is one of the courses offered by the Faculty of
Business Management at Open University Malaysia (OUM). This course is worth
3 credit hours and should be covered over 8 to 15 weeks.

This course is offered to students undertaking the Bachelor of Management,
Bachelor of Human Resource Management and Bachelor of Business
Administration. This course begins with an explanation on the meaning of
organisational behaviour, the disciplines that contribute to the study of
organisational behaviour and the challenges faced by managers in managing an
organisation. Students should understand the importance of this subject since
organisational behaviour influences the achievements of organisational objectives
more efficiently.

As an open and distance learner, you should be acquainted with learning

independently and being able to optimise the learning modes and environment
available to you. Before you begin this course, please confirm the course material,
the course requirements and how the course is conducted.

It is standard OUM practice that learners accumulate 40 study hours for every
credit. As such, for a three-credit hour course, you are expected to spend 120
study hours. Table 1 gives an estimation of how the 120 study hours could be

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Table 1: Estimation of Time Accumulation of Study Hours

Study Activities
Briefly go through the course content and participate in initial discussion 3
Study the module 60
Attend three to five tutorial sessions 10
Online participation 12
Revision 15
Assignment(s), Test(s) and Examination(s) 20

By the end of this course, you should be able to:
1. Explain the terminology associated with organisational behaviour;
2. Explain how values, emotions, attitudes affect organisational behaviour;
3. Explain the theories and concepts of motivation, leadership and
4. Analyse the impact of politics, power, conflicts and change to organisational
behaviour; and
5. Discuss the theories related to current issues and future trends in
organisational behaviour.

This course is divided into 11 topics. The synopsis for each topic can be listed as

Topic 1 is an introduction of organisational behaviour and centers on the

disciplines that contribute to the study of organisational behaviour. This topic
touches on the discipline, challenges and opportunities of organisational

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Topic 2 focuses on the individual element in greater depth. We will discuss the
differences between individuals, and how their biographical traits are linked to
work attendance, job satisfaction, commitment to the job and productivity.

Topic 3 explains the important aspects of the individual, such as values, emotions
and attitude. This topic aims to clarify how individual values, emotions and
attitude influence employees' actions and behaviour at the work place in order to
achieve job satisfaction. Managers and would-be managers should be aware of
this to effectively manage an organisation.

Topic 4 discusses theories of motivation and their application in the workplace. It

also covers the job characteristics model and factors that need to be considered
when designing work.

Topic 5 explains stress in the workplace. It also covers the causes and the effects
of stress to the employees, and in turn, to the organisation as well.

Topic 6 discuss group and team behaviours. It also explains the differences
between groups and teams and identification of the types of teams and ways of
forming effective teams.

Topic 7 explains the need for the kind of leadership that can positively influence
the performance of an organisation. This topic emphasises on the power of
leaders, the differences between leaders and managers, traits, behaviours,
contingencies and neo-charismatic theories.

Topic 8 elaborates the role of communication in creating a superior work

environment for the group. It starts with the functions of communication,
communication process and the basics of communication. This topic touches on
overcoming communication barriers and contemporary issues in communicating
and how to enhance our communication skills.

Topic 9 discusses organisational structure. Among the things that we will discuss
are elements that shape the structure of an organisation, forms of structure and
factors that influence the organisational structure. This topic looks into
organisational culture and details the role of culture in achieving the goals of an

Topic 10 covers in more detail the subject of power, which encompasses the
definition of power, dependence and tactics of power. This topic also includes
discussions on the meaning of political behaviour and how it exists in an

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Topic 11 introduces the types and forces in organisational change. It also

discusses change resistance and overcoming change resistance. This topic ends
with action plans that can help an organisation to sustain change.


Before you go through this module, it is important that you note the text
arrangement. Understanding the text arrangement will help you to organise your
study of this course in a more objective and effective way. Generally, the text
arrangement for each topic is as follows:

Learning Outcomes: This section refers to what you should achieve after you
have completely covered a topic. As you go through each topic, you should
frequently refer to these learning outcomes. By doing this, you can continuously
gauge your understanding of the topic.

Self-Check: This component of the module is inserted at strategic locations

throughout the module. It may be inserted after one sub-section or a few sub-
sections. It usually comes in the form of a question. When you come across this
component, try to reflect on what you have already learnt thus far. By attempting
to answer the question, you should be able to gauge how well you have
understood the sub-section(s). Most of the time, the answers to the questions can
be found directly from the module itself.

Activity: Like Self-Check, the Activity component is also placed at various locations
or junctures throughout the module. This component may require you to solve
questions, explore short case studies, or conduct an observation or research. It may
even require you to evaluate a given scenario. When you come across an Activity,
you should try to reflect on what you have gathered from the module and apply it
to real situations. You should, at the same time, engage yourself in higher order
thinking where you might be required to analyse, synthesise and evaluate instead
of only having to recall and define.

Summary: You will find this component at the end of each topic. This component
helps you to recap the whole topic. By going through the summary, you should
be able to gauge your knowledge retention level. Should you find points in the
summary that you do not fully understand, it would be a good idea for you to
revisit the details in the module.

Key Terms: This component can be found at the end of each topic. You should go
through this component to remind yourself of important terms or jargon used

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throughout the module. Should you find terms here that you are not able to
explain, you should look for the terms in the module.

References: The References section is where a list of relevant and useful

textbooks, journals, articles, electronic contents or sources can be found. The list
can appear in a few locations such as in the Course Guide (at the References
section), at the end of every topic or at the back of the module. You are
encouraged to read or refer to the suggested sources to obtain the additional
information needed and to enhance your overall understanding of the course.

There is no prerequisite requirement for learners prior taking this subject.

Please refer to myVLE.

Collela, A., Hitt, M., & Miller, C. (2006). Organisational behaviour: A strategic
approach. USA: John Wiley & Sons, Inc.
Daft, R. L. (2008). The leadership experience (4th ed.). USA: South- Western.
Kohlberg, L. (1976). Moral stages and moralization: The cognitive
developmental approach. In Graham, J. Leadership, moral development and
citizenship behaviour. Business Ethics Quarterly, 5 (1), pp 43-54.
Luisser, R. N. (2010). Human relations in organization: Applications and skills
building (8th ed). Boston: McGraw Hill - International.
Palmer, I., Dunford, R., & Akin, G. (2008). Managing organisational change (2nd
ed.). New York: McGraw-Hill International.
Robbins, S. P., & Judge, T. A. (2008). Organisational behavior. Prentice Hall.
Schermerhorn, J. R., Hunt, J. G., & Osborn, R. N. (2008). Organisational behaviour
(10th ed.). USA: Wiley, John & Sons, Incorporated.
Zauderer, D. (1992). Integrity: An essential executive quality. Business forum
(Fall), pp.12-16.

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The TSDAS Digital Library has a wide range of print and online resources for the
use of its learners. This comprehensive digital library, which is accessible through
the OUM portal, provides access to more than 30 online databases comprising e-
journals, e-theses, e-books and more. Examples of databases available are
EBSCOhost, ProQuest, SpringerLink, Books24x7, InfoSci Books, Emerald
Management Plus and Ebrary Electronic Books. As an OUM learner, you are
encouraged to make full use of the resources available through this library.

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Topic Introduction
1 Organisational

By the end of this topic, you should be able to:

1. Explain what a manager is;
2. Explain the functions and roles of a manager;
3. Discuss the meaning of organisational behaviour;
4. Identify five disciplines that contribute to the study of organisational
5. Assess the challenges and opportunities for managers in practising
organisational behaviour; and
6. Explain the relationship between dependent and independent
variables in the study of organisational behaviour.

What is organisational behaviour? Organisational behaviour is the behaviour of
individuals and groups in an organisation. Studies in organisational behaviour
have so far emphasised the interpersonal psychosocial relationship and dynamic
behaviour in an organisation. To be an effective manager, it is essential for an
individual to have an understanding of organisational behaviour.

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The study of organisational behaviour also includes looking at other variables

that can influence the behaviour of individuals at the workplace. These consist of
the job, work design, communication and organisation structure and design. For
a better understanding of organisational behaviour, you need to know and
understand the discipline and variables that influence the study of organisational

In addition, you would have to observe the changes in the work environment as
these factors pose challenges to the development of an organisation. In this topic
we will discuss the fundamentals of organisational behaviour; its definition, as
well as the disciplines, challenges and opportunities involved in it.


Before we take an in depth look at this topic, you should know the definition of a
manager. Based on our discussion in the Principles of Management course in the
previous semester, a manager is defined as:

Someone who accomplishes a particular task via another person and/or a

group of people. A manager is an individual who makes decisions, distributes
the resources of an organisation and directs employees in performing certain
activities in order to achieve the goals of the said organisation.

What is an organisation? An organisation is generally defined as:

A social unit made up of two or more individuals working together to achieve

a common goal.

A more accurate definition of an organisation, however, involves an

understanding of the organisational social structure, involvement, goals,
technology and surroundings. The next subtopic will introduce the functions and
roles of a manager and his/her managerial skills.

1.1.1 Functions of a Manager

What are the functions of a manager in ensuring that an organisations goals are
met? Figure 1.1 shows the four functions of management.

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Figure 1.1: The four functions of management


Based on Figure 1.1, have you performed any of the functions listed? If
yes, how did you do it? Discuss during your tutorial.

1.1.2 Roles of a Manager

After taking into account the functions of a manager, let us now review the roles
of managers.

According to Henry Mintzberg, a manager has three main roles:

(a) Interpersonal Role

This refers to the need to communicate with the subordinates and/or
colleagues. There are three types of interpersonal roles:
(i) As a figurehead in an organisation who has a key responsibility
during official functions of an organisation such as officiating and
closing functions, or visiting hospitalised employees, etc.
(ii) As a leader who needs to motivate, train and take disciplinary action
against an employee.
(iii) As a liaison who needs to interact with other parties to establish not
only mutually beneficial work relationships, but also networking

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(b) Informational Role

A manager is almost always responsible for obtaining and disseminating
information from within an organisation, as well as externally. This
information is gathered and monitored whille suitable and related
information will be disseminated to staff and other parties in the
organisation. In addition, a manager also acts as a representative or
spokesperson for the organisation when dealing with external parties.

(c) Decision-making Role

In this role, a manager may contribute ideas to a particular project whilst
displaying his role as an entrepreneur, handling employees in related
problems and making appropriate decisions. A manager is also responsible
for allocating resources and being a negotiator in all business-related

Figure 1.2 shows the three roles of a manager.

Figure 1.2: Three roles of a manager


1. What are the duties and responsibilities of a manager?

2. List three types of interpersonal role.

3. What are the differences between the informational role and

decision-making role?

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1.1.3 Managerial Skills

An effective manager has to be equipped with three kinds of skills; technical,
people and conceptual. The explanations for these three skills are shown in
Table 1.1.

Table 1.1: Three Managerial Skills

Managerial Skills Explanation

Technical Skills It refers to a managers ability to use his/her knowledge or

expertise in a particular field, for example expertise and
technical skills possessed by doctors and engineers. Individuals
from these professions are subjected to a thorough formal
education. However, some technical skills are acquired through
on-the-job experiences.

People Skills It refers to a managers ability to work with other people whilst
understanding and motivating them. There are many people
who lack the ability to relate and interact with other people
despite having sound technical knowledge. People skills are an
important tool for a manager who needs the assistance of
another individual and/or a group of individuals in carrying out
his/her work.

Conceptual Skills It refers to a managers ability to analyse and diagnose a

complex situation or problem. For instance, in making any form
of decision, a manager has to identify the problem, seek
alternatives to overcome the said problem, and evaluate and
select the best solutions to the problem.


All the three mentioned skills are essential for a manager. Do you think
they are equally important to different managers at various levels of
management? Discuss.

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Organisational behaviour can be briefly defined as:

A study of individuals and groups in an organisation.

Other definitions include:

Actions and attitudes of individuals in an organisation.

According to Robbins (2008), organisational behaviour is:

An area of study concerning the effects of an individual, a group of

individuals and its structure towards the behaviour of people within the
organisation and the use of this understanding towards increasing the
efficiency of an organisation.

In simple terms, the definition above describes organisational behaviour as a

study of how the behaviour of an individual in an organisation and his/her
reactions affect the overall performance of the organisation. In view of the fact
that organisational behaviour concerns relationships at the workplace, it is only
natural that its interests are on work, tasks, absenteeism, turnover, productivity,
performance and management.

A sound understanding of organisational behaviour will enable a manager to

identify a problem, obtain staffs confidence when taking corrective action/s and
ensure that all changes undertaken are achieving their goals. In summary,
organisational behaviour attempts to understand, explain, predict and modify
the behaviour of individuals within an organisation.

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A few fields of study, theories, models and beliefs contribute towards
organisational behaviour, namely, psychology, sociology, social psychology,
anthropology and political science. The explanations for the five disciplines are
as shown in Table 1.2.

Table 1.2: Five Disciplines that Contribute Towards Organisational Behaviour

Disciplines Explanation

Psychology It is a science that attempts to measure, explain and at times,

modify human and animal behaviours. Psychologists
continuously strive to understand the behaviour of individuals.

Sociology Whilst the focus of psychology is on individuals, sociologists

strive to understand the roles of individuals within a social
system, i.e. peoples relationship with other people. Sociologys
contribution to organisational behaviour has to do with the
groups, team formation, organisational culture, communication,
power and conflict.

Social Psychology Social Psychology is a combination of psychology and sociology

with its concern being on the influence of an individual and/or a
group of individuals on another individual and/or group.

Anthropology Anthropology focuses on human activity. The study focuses on

the cultures and environments that may help us understand the
differences in fundamental values, attitudes and behaviour
between and among people in different countries and within the

Political Science Political Science is a study of individual and group behaviour

within a political environment. These include conflicts of
structure, allocation of power, as well as manipulation of power
by individuals for their own self-interest.

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The diagram below depicts the various disciplines that contribute to the
study of organisational behaviour. Match the topics on the right to their
respective disciplines on the left.

Discipline Topic

Individual Level Analysis

Psychology Individual differences and
Sociology Learning
Values and Attitude

Group Level Analysis

Anthropology Formation of Groups
Group and team effectiveness
Political science Communication

Organisational Level Analysis

Strategy and Structure


This subtopic will introduce you to the challenges faced by todays managers in
their quest to meet their organisational aims and to remain competitive. The five
main challenges and opportunities in the global arena are as shown in Figure 1.3.

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Figure 1.3: Challenges and opportunities in the global arena

We will now have a detailed look at these five challenges and opportunities in
the global arena.

1.4.1 Managing Globalisation

Todays organisations are facing various challenges with local and international
competitors. Thus, an effective management should have at least two types of

(a) Firstly, a manager who is exposed to an overseas assignment that will

require him/her to deal with a workforce that differs from the workforce
on his/her home ground in aspects such as wants, needs, attitudes and

(b) Secondly, a manager, who, despite being stationed locally, is assigned to a

task that deals with foreign superiors, colleagues and staff members.
Different methods of communication are used between the locals and
foreigners, for instance encouraging employees to be more open and direct
as compared to local employees who may view face saving as an
important factor. These differences may sometimes place a manager in an
awkward position. Thus, an effective manager will ensure that a productive
and conducive work environment is achieved by his/her ability to
understand the various cultures of employees in an organisation and
adapting these differences with a versatile management style.

It is essential for an organisation to adopt a globalisation approach in order to be

competitive in the market place.

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1.4.2 Managing a Diverse Workforce

Todays organisations also face challenges of adapting to diversity in the
workforce, i.e. in terms of gender, age, race and ethnicity.

Currently, there are many women holding high-ranking positions in the work
place (refer to Figure 1.4 as an example). In addition, the physically challenged
are also given equal employment opportunities, while cultural differences are the
norm in all organisations. These differences serve to enhance creativity and
innovation in an organisation while a diverse workforce is an asset if their
differences are rightly acknowledged and people are given equal treatment.

Figure 1.4: Tan Sri Dato' Sri Dr. Zeti Akhtar Aziz, Governor, Bank Negara Malaysia
Source: Bank Negara Malaysia

A manager can no longer afford to assume that his/her staff are similar or
homogeous, but instead needs to appreciate the differences in each individual as
a potential asset to the organisation.

1.4.3 Managing Changes in Technology

Todays managers must also be able to keep up with the changes in technology,
which have become synonymous with progress.

What is technology? Nelson and Quick (2008) define technology as:

The intellectual and mechanical processes used by organisations to convert

input into products or services that can achieve the objectives of the

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In view of the fact that technology is experiencing rapid changes, a manager has
to identify the right person for a particular task and choose the most appropriate
technology for his/her organisation. Failure to identify and adapt to the latest
and most appropriate technology may result in the organisation losing out to its

Accordingly, innovation and technology will almost certainly result in several

changes in the work environment. These changes are considered as a source of
stress since employees generally have a negative view of change; fearing that the
changes are going to adversely affect their career. An effective manager should
consider these difficulties.

1.4.4 Managing Ethics

Managers are not spared from experiencing ethical challenges and dilemmas.
Organisations that have clear-cut policies and work practices are usually very
successful in managing the challenges and dilemmas that involve ethics.
However, some organisations face difficulty in managing their ethics-related
problems. This is because not all individuals or employees have similar
opinion/s on what is right and wrong (refer to Figure 1.5).

Figure 1.5: Wrong attitude


Fortunately, todays societies in general are more knowledgeable on their need to

act within the boundaries of the law and regulations, being fully aware that
breach of trust and pursuing ones personal interest at the expense of their
respective organisations will result in undesirable consequences to them and the

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Overall, managing work ethics refers to an individuals ability to decide and

choose the right behaviour, which does not contradict with the organisations
general values and principles. These values should be instilled in all individuals
from the beginning.

1.4.5 Managing Downsizing

Downsizing or the intentional process of permanently reducing staff numbers in
an organisation has been a widespread change practice since the 1970s. Multiple
strategies may be associated with downsizing beyond a simple cost-reduction
approach. Companies may approach downsizing as one among a number of
methods to achieve cost cutting, sometimes employing it as a last resort (refer to
Figure 1.6).

Figure 1.6: A cartoon on downsizing

Source: John McPherson

Downsizing provides some challenges of its own. According to Palmer (2009),

downsizing creates an issue of employee retention. Through downsizing, it may
lead to the loss of important skilled employees. When employees see their peers
leaving, they begin to doubt their future at the company. Without these valued
members of the organisations, the productivity of the company may decrease.

Palmer (2009) said downsizing could also create a survivor syndrome. In this
context, the employees that remain with the organisation following a downsizing
exercise, may suffer from this syndrome where they question why the change
occurred, feel guilty that they remained in the organisation while some of their
valued work colleagues are unemployed, and may have low morale from

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wondering whether they are likely to lose their jobs in future downsizings. They
feel disassociated from the organisation particularly when they are not involved
in the planning and goal setting for any subsequent organisational restructuring


Discuss five challenges faced by managers in organisational behaviour

and explain the opportunities from these challenges.


Next, we will look into the organisational behaviour model. In general,
organisational behaviour (see Figure 1.7) is made up of three components. A
group is formed on a foundation built by individuals. The formal system or
structure acts as a framework in meeting the organisations goals.

Figure 1.7: Basic model of organisational behaviour

Source: Robbins (2008)

The next subtopic will explain the two types of variables involved: dependent
and independent, in order to understand the relationship between components
in the organisational behaviour model. Let us read on.

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1.5.1 Dependent Variables

The dependent variables are the main factors that predict or explain outcomes,
and are strongly influenced by other factors. The main dependent variables are
productivity, absenteeism, turnover, job satisfaction and organisational
citizenship. Let us look at the explanation of these dependent variables in
Table 1.3.

Table 1.3: Dependent Variables


Productivity It refers to the efficiency and effectiveness of an organisation in achieving

its goals. It helps to assess whether a particular organisation has
successfully accomplished its goals while making optimum use of its (the
said organisation) resources.

Absenteeism It refers to an employees failure to turn up at the workplace. An

organisation will suffer great losses if it has high employee absenteeism. In
this instance, work and decision-making will be interrupted and affected.
There are occasions where an operation comes to a standstill when
employees fail to turn up for work.
However, not all absenteeism is negative. For example, a staff who is
unwell, exhausted or has a personal problem would have to take time off
to recuperate until he/she is ready to return to work.

Turnover Turnover refers to a situation where employees, voluntarily or

involuntarily leave an organisation. A high turnover rate can affect the
smooth running of an organisation. This will be greatly felt if highly skilled
or experienced staff leave an organisation. New employees will have to be
recruited to fill the vacant positions.

Job Satisfaction Are you happy with your present job? Your response to this question
reflects your level of job satisfaction because job satisfaction refers to an
employees general feeling towards his/her career.

The level of satisfaction is increased if an employees tasks and

responsibilities are in line with his/her expectations and the values and
standards that he/she subscribes to. On the contrary, an employee will
have low job satisfaction if his/her expectations are not met and the tasks
and responsibilities that he/she performs contradict his/her values and
belief system.

Organisational The behaviour that is not considered a formal requirement but is essential
Citizenship towards the effectiveness of an organisation is known as organisational
citizenship. Employees with good organisational citizenship are those who
are prepared to work well while contributing more than the required time
and energy on their work.

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1. How often were you absent from work this year? What were your
reasons for not going to work? What were the effects of your
absenteeism to your organisation?

2. Can you distinguish the relationship between job satisfaction and

turnover rate? Would you agree if we say that an organisation will
have a low turnover rate if its employees enjoy a high level of job

1.5.2 Independent Variables

Brainstorm on the factors that influence the levels of productivity, absenteeism,
turnover, commitment and job satisfaction. The answer to this question is related
to the independent variables, which involve three of the main components
mentioned in Table 1.4.

Table 1.4: Independent Variables

Independent Variables Explanation

Individual Level Individuals who work with an organisation normally bring
with them several qualities that will influence their
behaviour in the organisation. These qualities include age,
gender, marital status and personality. In addition,
perception, motivation, educational level and personal
values will also affect an individuals behaviour in an
Group Level When in a group, individuals usually act differently from
when they are on their own, thus it is important to
understand the group as an independent variable.
Communication, leadership, power, politics and conflict are
group related factors that will be discussed later.
Organisational Level Work and organisational design/s that make up the formal
structure of an organisation are also independent variables
that influence organisational behaviour. In addition, culture
and practised policies also play an important role in
determining the mentioned behaviour.

With reference to Figure 1.8, try to understand the components involved in the
study of organisational behaviour. These components will be discussed in detail
in the subsequent topic.

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Figure 1.8: Organisational behaviour model

Source: Adapted from Robbins, S. P., & Judge, T. A. (2008).
Organisational behaviour. New Jersey: Prentice Hall


1. Distinguish between dependent and independent variables.

2. Sketch a diagram to explain the relationship between the two


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Choose the correct answer

1. All of the following factors are challenges in the global arena

A. Managing ethics
B. Managing a family
C. Managing globalisation
D. Managing a diverse workforce

2. Which of the following statements does not describe the functions

of a manager in an organisation?
A. Setting responsibilities to complete a task.
B. Display a good attitude and discipline at work.
C. Use ones influence to motivate an employee.
D. Identify goals and methods to achieve the pre-determined

3. All of these topics contribute to the study of organisational

behaviour EXCEPT:
A. Strategy
B. Motivation
C. Formation of group
D. Hostile external environment

4. Which of the following statements describe the challenges and

opportunities in organisation behaviour?
A. Some organisations face difficulty in managing their ethical
B. Innovation and technology will almost certainly result in
changes in the work environment.
C. Organisations are facing pressures on equal opportunities
and cultural differences.
D. All of the above.

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5. Which one of the following disciplines does not contribute to the

scope of organisational behaviour?
A. Biology
B. Sociology
C. Psychology
D. Anthropology

This topic discussed the roles of the manager, as well as the numerous
aspects related to organisational behaviour, including the disciplines that
contribute to its study, the challenges involved, and the two variables that
effect organisational behaviour.

A manager makes decisions and distributes the resources of an organisation.

A manager performs four functions planning, controlling, organising and

directing, while playing three roles interpersonal, informational and
decision making.

Organisational behaviour is the study of individuals and groups in an


Managers face many environmental challenges including the challenges of

managing diversity at the workplace, ethics, technological changes and
downsizing. These challenges give tremendous pressure on managers as
they have to deal with helping employees and the organisation to achieve
their goals.

There are two types of variables in the organisational behaviour model

dependent and independent. These two variables strongly influence
behaviour and performance.

Knowledge of all these is necessary for you to have a better understanding

of the concept of organisational behaviour and its consequences.

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Conceptual skills Job satisfaction

Diverse workforce Productivity
Environmental challenges Technical skills

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Topic Individual

By the end of this topic, you should be able to:

1. Identify four biographical characteristics that differentiate individuals;
2. Recall two of an individuals potential capabilities;
3. Describe learning and how learning shapes an individuals behaviour;
4. Explain the meaning of personality and how an individuals
personality is influenced by environmental factors;
5. Assess three factors that influence perception;
6. Explain three factors which can assist in differentiating internal and
external attributes in attribution theory; and
7. Review five shortcuts to assessing others.

This topic focuses on individual differences. The individual is the main
component in the study of organisational behaviour. While we often say that
each person is born the same, the fact remains that everyone is different.

Features such as age, gender and marital status are several of many factors that
differentiate you from your superior, colleagues and family members. Similarly,
the posts offered to us and the duties and responsibilities entrusted to us are also
different. As an example, not everyone can become doctors or engineers. We all
have different personalities with some of us being reserved while others are
outgoing. Our upbringing and educational background also contribute to our

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Individual differences need to be identified and be given due recognition by the

management of an organisation as they directly affect an individuals behaviour
in an organisation.


In this topic we will look at the four biographical characteristics of an individual.
An individuals personal characteristics depict the similarities or differences of
human preferences. Figure 2.1 shows four biographical characteristics of an

Figure 2.1: Four biographical characteristics of an individual

The explanations for these biographical characteristics of an individual are as


(a) Age
There are few pre-conceptions on the correlation between age and
performance. It is commonly believed that work performance declines with
an increase in age. While the truth of this matter is insignificant, the fact
remains that many people believe that an individuals performance at the
work place decreases as the individual grows older.

A middle-aged employee is said to be reluctant to try anything new

especially when it concerns technology. During a downsizing, the
management of most organisations would often target middle-aged

In addition, various studies have also indicated that the older a person is
the less likely to leave the job. This does not come as a surprise since an
increase in age reduces an individuals chances of being employed by most
organisations, which prefer to recruit younger individuals who are believed
to be more creative and more motivated.

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A higher drawn salary and fringe benefits that include bigger pensions are
also reasons that deter senior staff members from making a career switch.

Generally, older employees appear to be more of a liability rather than an

asset to an organisation. On the contrary, we should be made to understand
that mature employees are actually an asset to an organisation in view of
their vast work experience, ability to make sound judgments, and better
work ethics and commitment to their work.


1. Are you able to identify the differences between a middle aged and
a young employee at your workplace? Could you detect any
correlation between their ages and performances?

2. What is the difference between the health of middle-aged and older

employees? Research has shown that older employees have a
higher rate of absenteeism due to poor health, in addition to the
decrease in productivity level. Do you agree with this? What are
your justifications?

3. Based on your experience, list down additional strengths and

weaknesses of employees aged 50 and above.

(b) Gender
Many have questioned whether female employees contribute equally to an
organisation as their male counterparts. Many studies have shown that
women are more willing to receive instructions while men are perceived as
aggressive and success driven.

These differences are insignificant since there are no consistent differences

between the abilities of men and women in aspects of problem solving,
analytical skills, or decision making.

Currently, there are plenty of opportunities for women who either want to
work at home or in an organisation. Women have the choice whether to
telecommute or to have flexible working hours. A caring employer must
understand the magnitude of roles played by their female employees.

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(c) Marital Status

From your experience, do you find any differences in the productivity
levels of a married and unmarried employee? You may find that marriage
has no significant influence on the work performance of the employees.

(d) Length of Service

It makes sense to think that long service staff would have substantial work
experience. Studies have shown that length of service is positively
correlated with productivity. Turnover rate for these senior staff is also low.
In other words, length of service is negatively correlated with turnover rate.



From Topic 1, you should be familiar with workforce diversity. Individual
differences can also be observed in their respective capabilities. Differences in
capabilities is yet another feature of this diversity.

What is ability or capability? Capability can be defined as:

An individuals ability to perform a task or work.

Why cant everyone become a doctor or an engineer? The answer is because our
abilities or capabilities are not the same. A persons capabilities can be seen in
terms of two aspects, which are intellectual and physical, as shown in Table 2.1.

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Table 2.1: A Persons Capabilities

Intellectual Capability Physical Capability

It is required in performing mental It is required in performing hard labour

activities. The dimensions commonly and work that requires stamina. Those
associated with intellectual capability are who plan policies or those who solve
number aptitude, oral comprehension problems require intellectual capability
and speed in perception and memory while physical capability is also essential
to an organisation. For example, athletes
and firemen require good physical
strength and stamina in performing their
jobs. There are many jobs that require
physical capability especially blue collar


How can we match a persons capabilities with the job that he does?

Let us now look at the meaning of learning. Is it possible for a person to pass an
exam with flying colours yet has failed to learn anything? Do you believe that
learning is a continuous process and does not end after we leave school?

Learning, in fact, involves change. The kind of change meant here is a change in
behaviour prompted by an individuals experiences. Learning begins with a
cognitive activity about certain knowledge that subsequently leads to a change in
behaviour. For example, if there is no change in your behaviour at the end of this
course, you have failed to learn.

Whilst the learning process is non-tangible, its effects can be proven. For
instance, someone who has just taken up a post in an organisation may initially
be incompetent or make numerous mistakes. However, with time and proper
guidance, he/she may end up mastering his task/s well.

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There are endless examples on the matter mentioned in Subtopic 2.3.

Excluding the mentioned examples, what do you understand from the
expression learning from mistakes?

2.3.1 Learning Theories

The three learning theories are shown in Figure 2.2.

Figure 2.2: Three basic learning theories

Now, let us look at the explanations and examples of the three basic learning
theories (refer to Table 2.2).

Table 2.2: Three Basic Learning Theories

Theories Explanation Example

Classical This refers to the process of behaviour The triggering of childhood memories
Conditioning modification via conditioned stimulus from listening to Hari Raya songs.
that is paired with unconditioned
stimulus. This produces an
unconditioned response.
Operant Operant conditioning involves A person will avoid a particular
Conditioning behaviour modification by positively or behaviour if he/she has been
negatively rewarding any said punished for performing that
behaviour. behaviour. On the contrary, if
someone is rewarded for performing a
task well, he/she will continue to
strive and work well in future.
Social Learning An individual can also learn by It is how children use their parents as
observing the outcome of other a yardstick for their (the childrens)
peoples behaviour or shared actions and behaviour.
experiences of other people.

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In addition, the experiences of others can also act as reminders to most, if not all,
of us. For instance, when you see a friend who succeeds in his/her business
through hard work and dedication accompanied by a never say die attitude,
you too would be inspired to follow in his/her footsteps. On the contrary, when
we look at drug addicts and the mess they are in, we automatically feel turned
off and try to avoid drugs.


Elaborate on the different types of learning that shape an individuals

behaviour as discussed earlier. How do these types of learning shape an
individuals behaviour?

While we often use the word personality, does it mean the same as the concept
we will discuss next? According to psychologists, personality is:

The way an individual interacts with and responds to his or her environment.
(Robbins, 2008)

Nelson and Quick (2008) define personality as:

A combination of stable traits that influences the way an individual behaves.

Taking both definitions into account, personality is said to remain constant

throughout time and in different situations. A collection of traits refers to the
cumulative qualities of an individual that overall describes him/her.

For example, a reserved person often keeps to himself and prefers to be left alone
and will most probably dislike socialising, or working as a marketing manager.
While shyness might be his dominant characteristic, it is by no means the only
characteristic that the person has. He may possess other characteristics like being
a loving person, or having a sense of responsibility, or is creative and ambitious.
All these characteristics make up this persons personality.

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How about your personality? Can you list the features of your

2.4.1 Factors Determining Personality

Why is it that some people are always bubbly and others are more serious and
intimidating? The answer to this question can be seen from the two main
determinants of personality, i.e. nature and nurture. Let us take a look at these
two factors that determine personality (refer to Figure 2.3).

Figure 2.3: Factors that influence personality

The explanations of these two factors that influence personality are as follows:

(a) Heredity
We often hear the expression like father like son. There is some truth in
this statement. Research has shown that a persons personality is shaped by
heredity factors. A study of 100 pairs of identical twins showed that despite
being separated since they were young, these twins displayed many
similarities in their personalities.

(b) Environment
The environment refers to our culture, upbringing, family norms, friends,
social groups and past experiences. The environment plays a significant
role in shaping ones personality.

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For example, the eastern culture normally encourages a person to develop a

more courteous and respectful attitude towards our elders while a
westerner is usually more direct and open in expressing themselves.
Parents are in a position to instil a strong sense of self-confidence in their
children while tragic experiences like poverty, or the loss of a loved one,
can also affect a persons personality.

2.4.2 Personality Traits

The term personality traits usually refer to the basic component of an
individuals personality. There are hundreds of personality traits used to
describe ones personality. Through research, experts have been able to identify a
few major factors that explain a persons personality.

One of the most popular models for describing personality is The Big Five Model
which uses five main dimensions to describe personality, as shown in Table 2.3.

Table 2.3: The Big Five Model

Dimension Description

Extraversion This is also known as sociability, and is a personality dimension

that accounts for social factors or a persons relationship with
others. An extroverted person makes a good leader, has a wide
circle of friends and is very determined in most of his/her
actions. On the contrary, an introverted person is more careful,
shy and quiet.

Agreeableness This dimension views the level of a persons agreeableness with

others. Some people readily agree with other peoples opinions.
These are people who easily cooperate, are cheerful, friendly,
trustworthy and readily adapt to their respective environment/s.
People with a high level of agreeableness perform best in a team
or when dealing directly with customers. In contrast, there are
people who are insensitive to the feelings of others, are very
disagreeable in nature and are not supportive of other peoples

Conscientiousness This is a dimension that measures the dependence level of a

person. Individuals with a high level of conscientiousness are
people who are responsible, disciplined, reliable and serious in
their work. Those with a low level of conscientiousness usually
take their work lightly and cannot be relied on to perform well at

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Emotional Stability This refers to a persons ability to cope with stress and to adapt to
his/her environment. Individuals with positive emotional
stability are more calm, confident and secure while those who
lack the mentioned stability, worry unnecessarily, are nervous
and lack confidence.

Openness to This dimension refers to an individuals ability to accept new

Experience experiences or changes. People who are open-minded are said to
be more creative, curious, intellectual and are more artistic. On
the other hand, there are people who are boring, lack creativity
and do not wish to move from their comfort zone.


Can you relate your personality to your career choice?

2.4.3 Other Personality Traits that Affect

Organisational Behaviour
There are other personality traits that influence ones behaviour in an
organisation. These are locus of control, Machiavellianism, self-esteem, self-
monitoring, introvertedness and extrovertedness, as well as Type A and Type B

We will now look at the explanations for each of these personality traits.

(a) Locus of Control

Locus of control is an aspect of conscientiousness, which is a dimension of
the Big Five Model. An individual may have either an internal or external
locus of control.

(i) Internal Locus of Control

Those who possess an internal locus of control believe they are able to
determine their own future and are personally responsible for their
success or failure.

People who possess an internal locus of control obtain great

satisfaction from their jobs, are serious in obtaining information and
have a high level of motivation.

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(ii) External Locus of Control

On the contrary, there are others who believe luck, other people and
external circumstances determine the success and failure of their lives.
This second group of people has an external locus of control.

Those with an external locus of control often attribute the

environment and other people for anything that comes their way; be it
success or failure. That is why they usually obtain lower job
satisfaction and have a higher rate of absenteeism. They are content to
be followers (receiving orders) and are reluctant to make decisions.


What do you attribute your success to? Do you think your success is a
result of hard work or luck? Which locus of control supports you?
Discuss during tutorial.

(b) Machiavellianism
This is a trait that is possessed by individuals who are opportunistic and
manipulative. These people may also be unethical while believing in the
concept of the ends justify the means. For them, winning is everything
and people are there to be manipulated.

(c) Self-esteem
This is a product of continuous evaluation of oneself. An individual will
assess and form an opinion of his capabilities, the behaviour he displays
and the way he carries himself.

Self-esteem can be observed in ones career choice:

(i) Individuals with a high self-esteem have a tendency to go for jobs

which are high in risk and high in status, i.e. pilots, doctors and

(ii) Those with low self-esteem will have lower targets and are generally
lacking in confidence. They are easily influenced by others and are
susceptible to stress and conflict when they face uncertainties and
unpleasant situations, or poor supervision in their workplace.

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Therefore, we can conclude that self-esteem has a positive correlation with

achievement and ones need to do a job well. People with positive self-
esteem also experience greater job satisfaction. Self-esteem is a main part of
the emotional stability dimension of the Big Five Model. Hence, a manager
should provide encouragement and appropriate challenges to employees
with high self-esteem.

(d) Self-monitoring
An individuals ability to observe the environment and to react
appropriately reflects his level of self-monitoring.

Individuals with high self-monitoring will behave in a way that is

appropriate to his/her environment/s. They know how to focus on
important aspects of any given situation. Therefore, it is difficult for a
manager to predict the behaviour of employees with high self-monitoring.

Employees with low self-monitoring are not sensitive to their

environment/s, react on impulse and have little consideration for others.
Their behaviour is consistent and can be easily predicted across differing
situations. Thus, a manager is able to easily predict the behaviour of
employees with low self-monitoring.

(e) Introversion and Extroversion

Introversion and extroversion form part of the social dimension in the Big
Five Model. A quiet and withdrawn person is known as an introvert while
a friendly and outgoing person is an extrovert.

A major implication of the differences in the mentioned two personalities is

in the manner that a job is performed:

(i) An introvert performs better when working on their own in a

secluded place.

(ii) An extrovert thrives in a crowded environment, which is filled with a

host of activities.

(f) Personality Type A and Personality Type B

The extent of a persons need for achievement, competition and
conscientiousness depends on his/her personality type; either Type A or
Type B:

(i) Individuals with a Type A personality thrive on competition, are

punctual, act fast and often in haste.

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(ii) A Type B personality is often relaxed, performs individual tasks and

usually reflects on their true feelings.

The Type A personality is susceptible to pressure and heart attacks.

However, research has found that they enjoy greater job satisfaction as
compared to the Type B personality.


In your opinion, who is more successful as a salesperson, the Type A or

Type B personality? Give your reasons.

Next, we will look into perception. What is the significance of perception in
organisational behaviour? Perception is important because as humans, our
reaction is based on our interpretation of a particular event. Sometimes we fail to
react because we have the wrong perception. Our perception of an event varies
depending on our background, position or perspective.

For example, while watching a football match between our favourite team and
another team, we usually have different perceptions from a friend who is also
watching the same game. If we happen to support a political party, then our
perspective would be biased towards the party of our choice. Two different
people will have differing interpretations of an event (refer to Figure 2.4).

Figure 2.4: Two different people with differing interpretations

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We play a variety of roles in life: as a human, friend, manager, father and so on.
Our perceptions will influence our behaviour towards others. Sometimes, our
reaction is based on our interpretation of an event.

It is important to have the right perception so that our assessment of friends,

colleagues, subordinates, superiors and our employees does not greatly differ
from reality.

Perception is important to us, especially in the context of a manager in an

organisation. In assessing performance, for instance, we might make the mistake
of rewarding a person whom we think have performed well in his/her work
when this might not be a true.


After you have reviewed the definition of perception, there are three factors that
influence perception as shown in Figure 2.5.

Figure 2.5: Factors that influence perception

Source: Adapted from Robbins, S. P. (2008). Organisational behaviour.
New Jersey: Prentice Hall

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2.6.1 Perceiver
When an individual spots a target and attempts to interpret what he sees, his
interpretation will be strongly influenced by his/her personal attributes. For
instance, on a bus, if you spot someone wearing the same outfit as you, you
will be more conscious of the persons presence than anyone else on the bus.
Personal attributes that influence perception are attitude, motive, interest,
past experience and expectations.

If you are highly participative in class and like to ask questions, you are bound to
prefer small classes. Conversely, a friend of yours who is shy and withdrawn
would prefer a bigger class. On the first day of class you discover that there are
500 students in that class. Due to the differing perceptions between you and your
friend, you are going to be unhappy with the class whilst your friend would be
pleased. At least your friend need not worry about having to participate in class.
You and your friend are viewing the same situation with different interpretations.

An unfulfilled wish or motive strongly affects a persons perception. If you

attend class after not consuming food for approximately 36 hours, you might
likely imagine the pen held by your lecturer as food. In this instance, you may
envision the pen to be a sausage. This perception will surely not be shared by
your classmates who are not as hungry as you are.

A plastic surgeon is able to detect what is not right with someones nose; a
carpenter would not. A civil engineer can detect structural faults in a building; a
teacher would not. Similarly if one of your employees is constantly late, you
would be more aware of his pattern compared to the occasional lateness of other

Past experiences too have an effect on your perception. Objects or events you
have not experienced or gone through will be felt more deeply compared with
those you have experienced in the past. If a fair skinned European woman
arrives at your village, her presence there would be more pronounced than that
of other women in the village. The same goes with expectations. Expectations can
affect your perception. One would expect a policeman to be firm and powerful or
an overseas graduate to be able to communicate well in English. Realities
however, may not meet your expectations, at all times.

2.6.2 Target
Characteristics of the target in question may influence our perception. A talkative
person stands out in a crowd compared to a quiet one. Movement, sound, size
and other characteristics influence our perception. An overweight person or a
midget is more easily noticed compared to a normal sized individual.

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Most of the time, we are not able to distinguish our targets from their
surroundings. The surroundings affect our perception of the target. Objects that
are close to each other are perceived as similar compared to objects that are on
their own. For example, if five people from the marketing department of your
organisation resigned at the same time, other staff members are likely to think
that they left because they have a problem with the head of the marketing
department who is known to be a firm, meticulous and disciplined person.

The reality could be that only one of the five who resigned has a problem with
the head of the marketing department whilst the remaining four left due to other
reasons, i.e. better offer elsewhere, furthering their studies, a new workplace
closer to home or wanting to be a full time home-maker. However, since all five
are considered and generally viewed as a team, people perceive that they have a
similar reason for resigning. This example clearly shows how far off our
perception could be from reality.

2.6.3 Situation
Elements in the environment may influence our perception too. During class, you
may notice a particular classmate. However, at a party you may not easily
recognise the same classmate due to the dim lighting, a different outfit and her
different character.

In this case, the perceiver and target is the same person but the situation and
environment are different. Features of the situation such as location, lighting and
heat, influence your attention.


Explain three factors that influence perception and provide an example

for each. Discuss with your coursemates.


Let us now discuss the factors that influence our judgement.

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2.7.1 Attribution Theory

The attribution theory was developed to explain the differences in our judgment of
others based on how we make sense of their behaviours. A behaviour prompted by
internal factors is considered voluntary while behaviour prompted by external
factors is not within the control of an individual. For example, you were informed
that one of your staff was late to work due to the faulty engine of the bus which he
was in. In this instance, you could form either an external factor (faulty bus engine)
or internal factor (overslept after attending a late night party) for your staffs

According to Robbins (2008), three factors assist in differentiating internal and

external factors and they are:

(a) Distinctiveness
This refers to the extent an individual displays the same behaviour or a
variety of behaviours in different situations. You are said to have high
distinctiveness if your behaviour varies in different situations. If you are
always late not only for your Organisational Behaviour class but for other
classes, appointments and meetings as well, you are said to possess low
distinctiveness. This reflects the internal factors governing your behaviour.

(b) Consensus
Consensus refers to whether everyone who faces a particular situation will
react in the same way. For example, thirty of your staff are late for work
today and since this is considered a high consensus, you attribute the
lateness to external factors. However, if only one was late, you would
attribute his/her lateness to factors internal to him/her since the consensus
is low.

(c) Consistency
This refers to the frequency of the occurrence of a particular behaviour,
whether regular or ad-hoc. If you are often late for lectures, your lecturer is
more likely to attribute it to factors internal to you. On the other hand, if
you have never been late, except for certain days, your lecturer will
attribute it to external factors. Figure 2.6 shows the determiners of

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Figure 2.6: Determiners of attribution

Source: Adapted from McShane, S. L., & Von Glico, Mary Ann (2006).
Organisational behaviour: Emerging realities for the workplace revolution.
McGraw-Hill: New York

2.7.2 Fundamental Error in Attribution

Fundamental error in attribution refers to a tendency to play down the
influence of external factors and to emphasise on internal factors when
assessing other peoples behaviour.

Managers sometimes make erroneous judgments of their staff. They over

emphasise internal factors (as opposed to external factors) while appraising their
staff. For instance, when a car salesman does not meet his target, the manager
attributes it to the salesmans lack of initiative (internal factors). The truth of the
matter might be that the salesman failed to achieve his sales target due to an
economic slowdown (external factor) and unattractive car models.

2.7.3 Self-serving Bias

Self-serving bias refers to an individuals tendency to attribute his/her
success to internal factors while laying the blame on external factors for their

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It is common for individuals to attribute their success to their hard work and
having made the right decisions. However, when the company fails, the very
same person will blame external factors. According to McShane, S. L. and Von
Glinow (2003), 90% of workers who receive low appraisals will choose to blame
their supervisors, the organisation, the appraisal system and other external
factors. Very few individuals will attribute their failure to obtain good or
satisfactory appraisal to their lack of work competencies.

Further examples include the annual report of companies. We will often find a
self-serving bias in the said reports. When a company makes a sound profit, the
management will attribute it to their responsiveness and their abilities to conduct
the business. On the contrary, when the company suffers a loss, external factors
will be blamed. Nevertheless, the concept of self-serving bias differs between
cultures. In Korea, employees accept full responsibility for the failure of their
company by laying the blame on themselves and their respective team/s.


You may opt to use short cuts to assess others. The five short cuts are shown in
Figure 2.7.

Figure 2.7: Five short cuts to assessing others

2.8.1 Selective Perception

Selective perception occurs when human beings selectively describe what they
see based on their interests, backgrounds, experiences and attitudes. Selective
perception enables you to describe something very quickly but sometimes you
tend to make mistakes. This is because it is difficult for you to assimilate all that
you see.

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According to Robbins (2008), in a study conducted by Dearborn and Simon, 23

executives of various functional fields were asked to read a comprehensive case
detailing the organisation of a steel company. Each executive was asked to list
down the major problems faced by the company. A large portion of the
executives attributed the problems of the company to their (the executives) field
of expertise. For example, a sales executive stated that the major cause of failure
of the steel company was performing the sales of steel without considering other
factors or functions.

In conclusion, we form a selective perception when attributing a particular

situation with an activity or aim related to us. As an example, let us assume that
your company is having problems due to the economic slowdown with rumours
of downsizing. During this time, a senior officer from headquarters comes for a
routine visit. While his visit might not have anything to do with the companys
performance during the slow period, a majority of employees might conclude
that his visit has to do with the rumoured downsizing exercise.

2.8.2 Halo Effect

A halo effect happens when we judge a person based on only one characteristic
of the individual. You will consider a loyal staff to be an employee who performs
well at the workplace. A Mathematics teacher may consider her highest
achieving student to not only be a good and ethical child but also a child who
performs well in other subjects. The truth of the matter is that it might not
necessarily be the case. Another example would be how an unfriendly lecturer
negatively assessed his/her students despite being conscientious, knowledgeable
and being dedicated to his/her responsibilities. As a potential manager, you
should avoid being influenced by the halo effect.

2.8.3 Contrast Effects

According to Robbins (2008), contrast effects occur when judgment of ones
characteristics is influenced by a comparison with another person whom we have
just met. During an interview, you will be compared with the candidate before
you. If you happen to be a better candidate, then chances are you will be given
far better ratings and stand a strong chance of being offered the job.

During a presentation, the first group to present will be compared with the
second and consecutive ones. If the first group is indeed the best, they will set a
standard against which the other groups will be compared.

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2.8.4 Projection
In projection, you will compare your characteristics with those of others. You
may be an honest person. You therefore expect your room-mate to be like you.
However, this might not be the case. For example, you would not think twice to
place your wallet in the room when you pay a visit to the restroom since you
believe your roommate would not pilfer your wallet or its contents. You think
along this line since you are an honest person who will not steal or pilfer items
belonging to someone else. Sometimes, however, you might be wrong.

As a future manager, you must face the fact that different employees have
different characteristics, behaviours, personalities and values.

2.8.5 Stereotyping
In stereotyping, you assess someone by the group that he/she belongs to. Such
judgment is sometimes not accurate. Whilst driving, have you ever been stuck
behind a car that is going very slowly? As you overtake the car and discover that
the driver is a lady, how often have you remarked, No wonder, its a lady!?
You are perpetuating the generalisation that all ladies are slow drivers. In reality,
there are ladies who love to speed!

Other common stereotypes are, mature employees not being interested to learn
anything new; men disliking taking care of children and inability of a physically
challenged person to perform task well.


1. Have you ever judged someone on the basis of the group he/she
belongs to? For example, if your friend were from a particular state
in Malaysia, would you justify this by referring him/her to the
state she belongs.

2. Discuss how environmental factors help shape ones personality.

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Choose the correct answer

1. Which one of the statements below is false?

A. Learning is the process by which we acquire new behaviour
from experience.
B. Punishment involves the presentation of negative
consequences such as reduction in pay.
C. Positive reinforcement involves the positive consequences
for a behaviour such as praise for working hard.
D. Operant conditioning theory and social learning theory are
not related with how learning from experience works in

2. Which one of the following statements is false?

A. Perception refers to the way people view the world around
B. General perceptual problems include logical error, halo
effect, projecting and stereotyping.
C. The process of perception consists of stages such as sensing,
selecting, organising and controlling.
D. Perception is the process of receiving sensory inputs and
organising these inputs into useful ideas and concepts.

3. The following items explain the traits, which collectively are

known as the Big Five EXCEPT:
A. Agreeableness
B. Conscientiousness
C. Emotional stability
D. Openness to environment

4. Personality traits that influence ones behaviour in an organisation

include all of the following EXCEPT:
A. Machiavellians
B. Locus of control
C. Type A and Type C personality
D. Introverted and extroverted attitude

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5. All of the statements below describe personality dimensions EXCEPT:

A. Agreeableness is the degree to which a person is easygoing and
B. Extraversion is the degree to which a person is outgoing and
derives energy from being around people.
C. Emotional stability is the degree to which a person handles
stressful and highly demanding situations with ease.
D. Consciousness is the degree to which a person focuses on success
and works toward a goal without using any proper way.

Understanding individual differences like age, gender, marital status,

learning style and personality is essential in guiding the manager when
selecting staff for an organisation.

The individual characteristics strongly influence job performance,

satisfaction, rate of absenteeism, and staff turnover.

Further understanding of individual differences would also enable a

manager to effectively carry out recruitment drives and promotions.

A persons capabilities can be seen in terms of two aspects intellectual

capability in performing mental activities and physical capability, which
requires stamina.

Learning begins with cognitive activity about certain knowledge.

We can see how learning shapes an individuals behaviour through three

basic learning thories classical conditioning, operant conditioning and
social learning.

Personality is the way an individual interacts with and responds to his or

her environment.

Culture, family, friends and experiences are environmental factors which

influence an individuals personality.

There are three factors which influence perception perceiver, target and

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Distinctiveness, consensus and consistency are three factors which can assist
in differentiating between internal and external attributes.

There are five short-cuts to assessing others selective perception, halo

effect, contrast effects, projection and stereotype.

We can match an employee with an internal locus of control to an important

task, refrain from placing a shy person in reception and always remember
that senior employees should not always be considered as a burden to the
company since they (senior citizens) could be equally productive, if not
more, than their younger counterparts at work.

Capability Operant conditioning

Classical conditioning Personality
Contrast effects Projection
Heredity Selective perception
Halo effect Social learning
Locus of control Stereotype

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Topic Values, Emotions,
Attitudes and Job
3 Satisfaction
By the end of this topic, you should be able to:
1. Explain the meaning of values, emotions, attitudes and job
2. Distinguish between values, emotions and attitudes;
3. Discuss how values, emotions and attitudes have a bearing on job
satisfaction; and
4. Assess the relationship between job satisfaction and organisational

Each individual is different in many ways. While this topic continues to discuss
individual differences, it now emphasises on values and attitudes.

We need to understand the differences between values and attitudes because

they both influence the actions of the individuals who make up the organisation.
The aims of the organisation will be easily achieved if employees share the
values and attitudes that are consistent with the mission and vision of the
organisation. Therefore, to better understand the individual, we need to consider
the values and attitude of employees because this is going to affect their job
satisfaction, commitment to the organisation and degree of work involvement.

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First of all, let us begin with the definition of values. Each person has different
values that they subscribe to. Values are beliefs of what is bad or good and what
should be defended. According to Nahavandi and Malekzadeh (1999):

Values are an individuals view of what is right or wrong, good or bad.

Values also refer to the basic principles that form ones beliefs, attitude and

Just like personality, values are formed at a young age. The values instilled in an
individual are influenced by family background, culture and education level.

It is essential for a manager to have a clear understanding of values because

values influence the attitude and behaviour of employees towards their work.
The value a person places on his work is actually a reflection of the kind of
returns he expects from his career and his belief on how one should behave on
the job. The returns mentioned here refer to the familys comfort and security,
honour and sense of achievement, acknowledgement and a meaningful life. How
one should behave on the job includes thinking creatively, being ambitious,
obeying orders and having respect for colleagues and superiors.


Values form the basic difference between individuals. You use values
to explain your behaviour as well as that of others.

How do you feel about a worker who is lazy but is given a promotion?

3.1.1 Types of Values

According to Rokeach (1973) as cited by Robbins (2008), values can be divided
into two types: terminal and instrumental.

Terminal values refer to the final aim or end-states that an individual wishes
to achieve while instrumental values refer to the means utilised to achieve
one's terminal values.

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Terminal values or end values are beliefs about the kind of goals or outcomes
that are worth pursuing. For example, some people value security, a comfortable
life and good health above everything else as the important goals to strive for in
life. Others may place greater value on social recognition, pleasure and an
exciting life. Instrumental values are beliefs about the types of behaviour that are
appropriate for achieving goals. According to Daft (2008), instrumental values
include such things as being helpful to others, being honest or exhibiting
courage. Figure 3.1 explains further about the types and examples of values.

Figure 3.1: The types and examples of values

Source: Adapted from M. Rokeach (1973). The nature of human values.
New York: The Free Press


1. Can you give a few suggestions as to how the terminal values

above can be achieved?

2. List three items that make up your terminal values and state the
instrumental values that can be utilised to achieve them.

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3.1.2 Inter-cultural Values

Values differ from one culture to another. A sound understanding of these
differences will greatly assist a manager to effectively predict and manage the
behaviours of his/her employees.

An approach often used to see differences in inter-cultural values is the one

suggested by Geert Hofstede. According to Geert Hofstede as cited by Robbins
(2008), managers and workers can be differentiated on five dimensions as shown
in Figure 3.2.

Figure 3.2: Five dimensions of values

Table 3.1 gives the explanation of the five dimensions of values.

Table 3.1: Five Dimensions of Values

Dimension of Value Explanation

Power Distance A societys level of acceptance for unequal distribution of power

in an organisation.

Individualism or Individualism is the preference of an individual to act on his

Collectivism own with his interest in mind. On the contrary, collectivism is to
take action on a collective basis after acquiring consensus from
all concerned members of the organisation. Collectivism reflects
a low level of individualism.

Avoidance of Certain societies favour uncertainties and consider it as a

Uncertainty challenge. However, there are societies that dislike uncertainty.
Groups with a strong aversion to uncertainty are more
susceptible to stress, worry and aggression.

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Quantity/Quality of Quantity of life refers to how much an individual values money

Life and position in his life. Quality of life is judged on the level of
importance that an individual places on relationships,
sensitivity towards other peoples problems and lending a
helping hand to others.

Long/Short-term Societies that live in a culture that possesses long-term

Orientation orientation often look far ahead in the future. For instance, they
strive hard for the future. Those with short-term orientation
often concentrate on the past and present events. They place
their importance on traditional values and work to fulfill their
social responsibilities.

According to Shermohorn, Hunt and Osborne (2008), values are relatively stable
and can affect work attitudes, emotions and moods. For instance, if a person
values a job challenge, he or she would probably tend to have a negative attitude
towards an assembly line job. Also, attitudes can influence emotions and moods
in much the same way. For example, if a person really likes his or her job, they
are more likely to have positive emotions and moods about it than if they do not.

Next, we will focus on emotions. According to Shermerhorn et al. (2008):

Emotions are intense feelings directed at someone or something.

Emotions have been described as being useful in a persons survival process. For
instance, the emotion of excitement encourages a person to deal with situations
that require high levels of energy, such as those he or she encounters during
school like doing assignments. At the same time, exertion of too much energy can
tire the person out.

In recent years, organisations have realised that employees emotions are

pervasive in the workplace. The emotions are not only a deep-seated part of
work life but play an important role in ones job performance. An employees
emotions and overall temperament have a significant impact on his or her job
performance, decision-making skills, team spirit, leadership, turnover, etc.
Generally, it is believed that employees bring their feelings of anger, fear, love
and respect with them when they come to work. An employees emotions are
essential to what happens in an organisation. Emotions matter because they
drive ones performance.
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3.2.1 Major Emotions and Their Subcategories

Researchers have identified six major categories of emotions, each of which
generally includes some subcategories. These categories are anger, fear, joy, love,
sadness and surprise, as shown in Figure 3.3.

Figure 3.3: Six major categories of emotions


While the categories are distinct from each other, the subcategories within each
are fairly similar. For example, anger may contain disgust and envy, fear may
contain alarm and anxiety; joy may contain cheerfulness and contentment; love
may contain affection, longing and lust.

3.2.2 Types of Emotions: The Positive and Negative

Emotions at the workplace generally fall into two types: the positive (good) and
the negative (bad). Figure 3.4 shows the two types of emotions.

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Do a research on deep acting and find out what it means. Discuss

during your tutorial.

Figure 3.4: Types of emotions

According to Shermoehorn et al. (2008) the impact of emotions on the job has
been well researched. Studies suggest that negative feelings have adverse effects
on job performance. Anger often leads to aggression towards colleagues while
sadness leads to dissatisfaction with the job. Envy or conflict with peers also
leads to frequent fights, which in turn, result in absenteeism. It is not always that
only bad emotions lead to bad results. An office romance, despite connoting
positive feelings, can have a negative effect on others.

However, emotions can have positive effects as well. Positive emotions increase
creativity, encourage helping behaviour and cooperation, and reduce aggression
both against the organisation and against people. Research suggests that positive
people have better cognitive abilities and tend to do better in the workplace.

3.2.3 Managing Emotions

Emotions can easily influence attitudes and behaviour at the workplace. In this
context, some jobs simply cannot be done if emotions are not dealt with first.
There are two ways of managing emotions at work:
(a) Surface acting; and
(b) Deep acting.

In surface acting, employees are expected to show emotions that they actually
might not feel. For example, an employee may fake a smile for his client even if
he is unhappy because of some personal reason. This method of managing

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emotions may lead to a discrepancy between what the employee expresses and
what he actually feels, and result in job dissatisfaction. According to
Shermerhorn et al. (2008), this leads to emotional dissonance, which refers to a
state of disagreement between internal expression of emotions and publicly
displayed emotions. Emotional dissonance is often accompanied by low
organisational commitment and low job satisfaction.


1. List five dimensions of values. Provide an example for each


2. What are the two types of emotions? How does it affect the

Now we will look at the meaning of attitude. Attitude can be described as a
persons assessment on other people, a particular object and current
environment. Briefly, attitude can be viewed as a persons feelings towards
something i.e. whether favourable or not. Values and attitudes are related
although they are two separate concepts. This can be explained from the three
components of attitude: cognitive, affective and behavioural.

Table 3.2: Three Components of Attitude

Components Explanation Example

Cognitive Beliefs, opinions, knowledge or If you feel that bribery is unethical,
information possessed by an then that is considered a value, which
individual. you hold. This aspect of belief is the
first component: Cognitive.
Affective Feelings, sentiments, emotions If you say, I dont like Zaki because he
towards a person, ideas or once bribed an officer, then this
objects. statement forms the second component
of belief: Affective.
Behavioural Reaction towards a person. If you avoid meeting or talking to Zaki,
then you are displaying the third
component of belief: Behavioural.

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Hence, an attitude is a strong belief or feeling toward people, things, and

situations. We all have favourable or positive attitudes, and unfavourable, or
negative attitudes towards life, human relations, work, school, and so on.
Attitudes are not quick judgments that change easily; but we can change our
attitudes. Our friends and acquaintances usually know how we feel about things.
According to Luisser (2010), people interpret our attitudes by our behaviour.
Attitudes are definitely important as mentioned by J.S. Marriot, President of
Marriot Corporation, We have found that our success depends more upon
employee attitudes than any other single factor. This is largely due to the fact
that customers evaluate service quality by the employees attitudes; employee
attitudes affect customer attitudes, according to Luisser (2010).

3.3.1 How We Acquire Attitudes

Attitudes are developed primarily through experiences. As people develop from
childhood to adulthood, they interact with parents, family, teachers, friends,
employees and managers, etc. From all these people they learn what is right and
wrong and how to behave. When encountering new people, or situations, you
are the most open and impressionable because you usually do not have enough
time to form an attitude towards them. Before entering a new situation, people
often ask others with experience about it. This begins the development of
attitudes before the encounter. For example, before you enrolled for this class,
you may have asked others who completed the course. If they had positive
attitudes, you too may develop a positive attitude; however, if they were
negative you may have started the course with a negative attitude as well. Figure
3.5 shows an example of negative attitude.

Figure 3.5: An example of negative attitude


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1. List and explain the three components of attitude. Provide

examples for each component.

2. What is the difference between values, emotions and attitude?

3.3.2 Attitude and Study of Organisational Behaviour

Although we have multiple attitudes, this course emphasises on relevant
attitudes only, such as attitude towards job satisfaction, involvement at the
workplace and commitment to the organisation.

Job satisfaction refers to ones overall attitude towards his/her job.

Often, when we talk about staff attitude, we are actually referring to the staffs
level of job satisfaction. Workers with a high level of job satisfaction will have a
positive attitude towards their job. On the other hand, a dissatisfied worker will
project a negative attitude. We will discuss job satisfaction in further detail later

Work involvement refers to how an individual feels on the suitability of

his/her career and how much time and effort he/she is willing to put into the

Organisational commitment is an individuals level of involvement in his/her


Staff members with a high level of organisational commitment are prepared to

serve to ensure that their organisation achieves its goals. There is a negative
correlation between organisational commitment and staff turnover and
absenteeism. Staff with high levels of commitment will continue to remain with
their organisation for a longer period of time.

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Please visit this website:

Identify how values and attitudes are conditioned among the biker fans.
How did the workers commitment here begin?


In this subtopic, we will have a detailed discussion on job satisfaction. As
mentioned earlier, a persons job satisfaction is a set of attitudes towards work.
Job satisfaction is what most employees want from their job, even more than they
want job security or higher pay. Employees who are more satisfied with their
jobs are absent less and they are more likely to stay on the job. Low satisfaction
often contributes to strikes, work slowdowns, poor product quality, employee
theft, and sabotage. A clear definition of job satisfaction is described below:

The term job satisfaction is used to describe how contented a staff member is
or how happy he/she is with his/her career. It actually refers to a collection of
specific attitudes towards work, which is directly related to an aspect of the
job itself.
(Hellriegal and Slocum, 2008)

3.4.1 Determinants of Job Satisfaction

Job satisfaction is on a continuum from low to high. It can refer to a single
employee, a group or department, or an entire organisation. Notice that the
definition of job satisfaction identifies an overall attitude towards work. This is
because people usually have positive attitudes about some aspects of work, such
as the work itself, and negative attitudes about other aspects of work, such as

There are a variety of determinants of job satisfaction. Each of these determinants

may be of great importance to some people and of little importance to others.
Table 3.3 depicts these determinants.

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Table 3.3: The Impact of Determinants of Job Satisfaction

Determinants Impact
The Work Whether a person enjoys performing the work itself has a major effect on
Itself ones overall job satisfaction. In this context, people who view their jobs as
boring, dull, or unchallenging tend to have low levels of job satisfaction.
Many people want to perform work which they believe is important.
Pay A persons satisfaction with the pay received affects the overall job
satisfaction. Employees who are not satisfied with their pay may not
perform to their full potential. Some employees who are dissatisfied with
their pay may steal organisational resources.
Growth and Whether a person is satisfied with their personal or company growth and
Upward whether the potential for upward mobility exists may affect job
Mobility satisfaction. Many, but not all, people want to be challenged and to learn
new things. Some people want to be promoted to higher level jobs,
whether in technical or managerial fields.
Supervision Whether a person is satisfied with the supervision received affects overall
job satisfaction. Employees who feel their boss does not provide
appropriate direction may become frustrated and dissatisfied with work.
Employees who feel their boss exerts too much control over their jobs also
may feel dissatisfied. The personal relationship between the boss and the
employee also affects job satisfaction.
Coworkers Whether a person has positive human relations with his or her coworkers
affects job satisfaction. People who like their coworkers often have higher
levels of job satisfaction than employees who dislike their coworkers.
Attitude Some people view work (attitude) as fun and interesting, while others do
towards work not. Some people have been satisfied with many different jobs, while
others have remained dissatisfied in numerous work situations. People
with a positive attitude toward work tend to have higher levels of job
satisfaction. Personality is associated with work attitude and behaviour.

People differ in the ways they prioritise the above determinants of job
satisfaction. A person can be highly satisfied in some areas and dissatisfied in
others yet have overall job satisfaction.

We will observe how job satisfaction is measured. The five elements used to
measure a persons satisfaction at work are as shown in Figure 3.6:

Figure 3.6: Five elements used to measure a persons satisfaction at work

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The Job Descriptive Index (or JDI) measures job satisfaction by utilising the
above five elements.

An individual may be satisfied with one aspect of his/her career yet is

displeased with the rest of the work factors. For instance, you may be pleased
with the level of responsibility given to you at work but you might be displeased
with your prospects for acquiring a promotion. In addition, individual
characteristics also have a bearing on ones level of job satisfaction.


Reflect and anticipate the level of job satisfaction of an individual with

an internal locus of control.

3.4.2 How Job Satisfaction Affects Organisational

Now we will look at how job satisfaction affects ones performance and
organisational behaviour. The areas typically affected are productivity,
absenteeism and turnover.

(a) Job Satisfaction and Productivity

Does someone with a high level of job satisfaction have a high level of
productivity? As propounded by Robbins (2008), a happy worker is not
necessarily a productive worker. On the other hand, a highly productive
worker is a happy worker with high levels of satisfaction.

Nevertheless, the above statement is based on research done at an

individual level. Based on all the relevant data gathered relating to
satisfaction and productivity at the organisational level, it seems that an
organisation with many satisfied workers shows better productivity .

In reality, there is not much evidence that explains the relationship between
work satisfaction and productivity. This is because the measurement done
did not take into account the aspects of interactions and the complexity of
the working processes. Thus, it is because of this that we cannot assume
that an employee who is satisfied with his work is a productive one.

(b) Job Satisfaction and Absenteeism

Research has shown that there is a negative relationship between job
satisfaction and absenteeism. However, the relationship is not as clear as it

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seems. There are other factors that influence an employee to attend work.
The organisations policies, for example, may influence an employees work

(c) Job Satisfaction and Turnover

Job satisfaction and rate of job turnover are negatively related as well.
However, the relationship here is stronger compared to the relationship
with absenteeism. Other factors influencing the rate of turnover includes
manpower market, other job opportunities and length of service.

In relation to employees who do not have high job satisfaction, what are their
actions? Employees can voice their dissatisfaction in four ways as explained in
Table 3.4.

Table 3.4: Four Ways of Expressing Dissatisfaction

Ways Explanation
Leave Employees not satisfied can choose to leave an organisation by
Voice-out Employees not satisfied with certain aspects of their work can help
improve the situation by expressing those dissatisfactions. They can do
so by giving suggestions or discussing it with the management.
Loyalty For certain employees, they will keep silent and hope that the situation
improves. In addition, they will defend the organisation from any
external criticisms.
Ignore There are employees who do not even try to take any action
whatsoever to improve the working condition that causes their
dissatisfaction. In fact, they allow the situation to deteriorate by
coming late to work, playing truant and working in a couldnt care
less attitude.


1. What is job satisfaction and how does it influence organisational


2. How do you explain the relationship between emotions and job


3. What can a manager do to raise the level of his/her staffs

organisational commitment?

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Choose the correct answer

1. Which of the following statements is false?

A. Job satisfaction and organisational commitment are two of
the most important workplace attitudes.
B. Job satisfaction is a favourable or unfavourable view of a job.
C. Job satisfaction affects the intention to stay in the job, the
actual decision to stay and absenteeism.
D. None of the above.

2. Which of the following statements does not describe an attitude?

A. It is a persistent mental state of readiness to feel and behave
in a favourable or unfavourable way towards a specific
B. It consists of a cognitive element, an affective element and a
behavioral element.
C. It may change through exposure to persuasive communication
or cognitive dissonance.
D. None of the above.

3. Value covers all of the dimensions below EXCEPT:

A. Cognitivism
B. Distance from power
C. Avoidance of uncertainty
D. Individualism or collectivism

4. Examples of instrumental values include all the items below

A. Prosperity
B. Competence
C. Imagination
D. Open-mindedness

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5. All of the following statements describe organisational commitment

A. There is a positive correlation between commitment and staff
B. There is a negative correlation between organisational
commitment and absenteeism.
C. Staff with high levels of commitment will continue to remain
with their organisation for a longer period of time.
D. Staff with a high level of commitment towards the organisation
are prepared to serve their organisation with more willingness
than others.

Values are beliefs of what is good or bad and what should be defended.

Emotions are intense feelings directed towards someone or something.

Attitude is a persons feelings towards something.

A persons job satisfaction is a set of attitudes towards work.

Understanding values helps us to be aware of the various attitudes workers

have towards their work. Besides that, you will have the opportunity to
relate attitude and job satisfaction.

You will gather from the discussions in this topic, that we cannot make
general assumptions on satisfaction with productivity, and turnover with

Recognising the relationship between emotions and job satisfaction helps us

to anticipate the various implications to the workforce.

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Absenteeism Individualism
Affective Instrumental values
Attitude Job satisfaction
Cognitive Terminal values
Emotions Turnover

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Topic Motivation and
Job Design
By the end of this topic, you should be able to:
1. Explain the early and contemporary theories of motivation;
2. Formulate strategies to improve motivation and performance;
3. Analyse the relationship between motivation and job design;
4. Review four alternatives in job designing; and
5. Formulate four new job schedule alternatives.

The term motivation comes from the Latin word movere, which means to
move. In todays context, motivation is something that drives an individual or a
group to do something or to achieve certain goals.

Figure 4.1: A motivation quote helps an individual or group to achieve goals

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According to Kreitner and Kinicki (2007), motivation is a psychological process

that provides the force, direction and continuous voluntary efforts in pursuit of a
goal. Managers need to understand these psychological processes so they will be
successful in leading their employees towards achieving the objectives of the
organisation. Robbins (2008) says that motivations are processes that take into
account an individuals conscientiousness, direction and continuous effort
towards achieving their aims.

This topic focuses on the theories of motivation and strategies to motivate

employees to perform. We will also briefly discuss job design and job schedule.


We will now discuss the theories of motivation. The two parts of these theories
(a) Early theories of motivation; and
(b) Contemporary theories of motivation.

4.1.1 Early Theories of Motivation

The early theories of motivation form a foundation on which contemporary
theories were built on. Although these theories came under heavy criticism in
terms of their validity and suitability of their applications, they are still referred
to by motivational researchers and managers when describing employees.

Figure 4.2 shows the early theories of motivation, which we will discuss.

Figure 4.2: Early theories of motivation

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The explanations for the early theories of motivation are as follows:

(a) Maslows Hierarchy of Needs

The psychologist, Abraham Maslow, proposed the Hierarchy of Needs
Theory in 1943. According to Maslow, in each person there exist five types
of needs which are arranged in hierarchical order, as depicted in Figure 4.3.

Figure 4.3: Maslows hierarchy of needs theory

He further divided these needs into:

(i) Lower Order Needs

This refers to the first three needs: physiological, security and social

(ii) Higher Order Needs

This refers to the need for esteem and self-actualisation.

Higher order needs are met internally whereas lower order needs are met
by factors externally to the individual, such as wages, rapport with
colleagues and union and sufficient food, as shown in Figure 4.4.

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Figure 4.4: Higher order needs and lower order needs in Maslows hierarchy of needs
Source: Adapted from Schermerhorn, Hunt & Osborn (2007).
Organisational behaviour. New York: John Wiley

According to Maslow, when one level of need has been met, an individual
will start to desire for the next level of needs. This goes on until he/she
reaches the highest need, which is self-actualisation. In order to motivate
someone, we need to know which hierarchy of needs he/she is currently at
and to focus on the level higher than the current level. This is due to the fact
that once a need is met, it loses its potential as a source of motivation.

This practice is important for a manager to uncover the unfulfilled needs of

his/her staff as a means to further motivate them.

(b) Theory X and Theory Y

Douglas McGregor introduced Theory X and Theory Y in his book, The
Human Side of Enterprise, in 1960. Based on his experience as a
management consultant, McGregor formulated two opposing assumptions
about human nature, i.e. the negative assumption which he calls Theory X
and the positive assumption, Theory Y. Table 4.1 shows the assumptions
for both Theory X and Theory Y.

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Table 4.1: The Assumptions of Theory X and Theory Y

Theory X Theory Y

People who dislike work and will try People view work as something
their level best to avoid doing it. natural, like rest and play.
Because they do not like their jobs, they People will direct themselves if they
should be constantly controlled, are committed to the organisational
reprimanded and coerced in order to objectives.
achieve the organisations objective.
Workers will be more committed to
Workers will avoid responsibilities and the organisational objectives when
will always wait for formal instructions they are rewarded. An average
to work. worker will learn to accept and seek
Most workers desire security. It is
utmost on their priority list compared to Normal human beings with
other work related factors. They are also imagination and ingenuity are
unambitious. innovative and creative.

What are the implications on motivation if you were to accept McGregor s

analysis? According to Robbins (2008), McGregor believes the assumptions
underlying Theory Y are more convincing compared to Theory X.
McGregor suggested strategies like collective decision making, shared
responsibility and challenging work, and good rapport with colleagues will
keep motivation levels high. However, there are no empirical evidences to
support these assumptions.

(c) Two Factor Theory

Frederick Herzberg introduced the two factor theory. Also known as the
Hygiene-Motivator Theory, it was founded on the findings of a study done
by Herzberg on 203 accountants and engineers. He interviewed them to
determine what factors contributed to job satisfaction and dissatisfaction.
Herzberg found there were significant differences between factors that
determined job satisfaction and those that determined job dissatisfaction.

Job satisfaction was usually associated with achievement, acknowledgement,

job features, responsibility and promotion. These factors were associated
with the job content. Herzberg called these factors as motivator factors, since
they were associated with hard work and high performance.

In his hypothesis, motivator factors were the cause for someone to shift
from dissatisfaction to satisfaction. Therefore, according to this theory, a
manager could quite easily motivate his staff by introducing motivator
factors in their duties.
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Herzberg also found out that dissatisfaction was related to work context
factors or the environment. Company policy, wages and interpersonal
relationship with supervisors and workplace environment were among the
factors responsible for dissatisfaction. Herzberg referred to these as the
Hygiene Factors. According to him, they did not stimulate the individual
but instead reduced his/her job satisfaction. In order to increase
motivation, motivator factors have to be emphasised.

Figure 4.5 shows the differences between motivator and hygiene factors.

Figure 4.5: Differences between hygiene and motivator factors

Source: Adapted from Schermerhorn, Hunt & Osborn (2007).
Organisational behaviour. New York: John Wiley


Describe the three early theories of motivation using a mind map.

4.1.2 Contemporary Theories of Motivation

We have so far discussed the early theories of motivation; we will now move on
to the next discussion which is contemporary theories of motivation. Figure 4.6
shows the contemporary theories.

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Figure 4.6: Contemporary theories of motivation

The explanations of contemporary theories of motivation are as follows:

(a) ERG Theory

Clayton Alderfer introduced the ERG (Existence, Relatedness and Growth)
theory in the 1970s. Alderfer revised Maslows hierarchy of needs with
reference to empirical evidence. This theory divides human needs into
three categories:

(i) Existence
He combined Maslows physiological needs and the need for security
like need for food, protection and a safe work environment. He called
it existence needs.

(ii) Relatedness
Relatedness needs refer to an individuals need for interaction with
others, acknowledgement from society and feeling safe in public.

(iii) Growth
Growth needs consist of an individuals self esteem, which is attained
through personal achievement and self-actualisation as described in
Maslows model.

Contrary to Maslows hierarchy, the ERG theory maintains that an

individual can at any one time be motivated by elements from two
hierarchies. You may be seeking to meet your need for growth even though
your need for relatedness has not yet been fulfilled.

Unlike Maslows model, the ERG theory includes a frustration-regression

process, whereby an individual who is not able to fulfil a higher level need,
may regress to a lower level need that can be met. For example, a person
will still be frustrated if his growth needs are not fulfilled despite having
fulfilled his existence needs and relatedness needs. In this case, his
relatedness needs will prevail over his needs for growth in terms of
prominence and may be a dominant source of motivation for the

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Do you agree that an individual can be motivated simultaneously from

two different levels as suggested by the ERG Theory? Why do you think

(b) McClellands Theory of Needs

David I. McClelland, a famous psychologist, put forth his Theory of Needs
to explain motivation. McClelland and his team had been studying the
relationship between needs and behaviour since the 1940s. They used the
Thematic Apperception Test (TAT) as a tool to measure human needs.

TAT is a projective technique that requires subjects to view pictures and

write stories about what they saw in the pictures. McClelland, at one time,
showed three executives a picture of a man seated at his desk looking at his
family pictures arranged on the table.

The response he got was interesting. The first executive guessed that the
man in the picture was an engineer who was thinking about his family
picnic the next day. The second executive guessed that the man was a
designer who had just got an inspiration for a new design from his family,
and the last executive guessed the man was an engineer who was trying to
solve a work related problem. From his expression, according to the third
executive, the man in the picture appeared to be finding a solution to his

From his studies, McClelland identified three instrumental needs in

understanding individual behaviour, which are the Need for Achievement
(nAch), Need for Affiliation (nAff) and Need for Power (nPower), as shown
in Figure 4.7.

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Figure 4.7: Three needs of individual behaviour

McClelland advocated that managers learn to identify how to determine

whether they have nAch, nAff or nPower within themselves as well as
others around them so that a work environment that is responsive to their
profiles can be created.

According to Schermerhorn (2007), this theory is extremely useful because

each need can be linked to a major work priority. A worker who has a
greater need to achieve will prefer individual responsibility, a moderate yet
challenging goal, and feedback on his performance. Successful
entrepreneurs have been known to have a high need for achievement
because they usually set very challenging goals.

An employee with a greater need for affiliation will tend towards

interpersonal relationships and opportunities for communication.
Managers with a low nAff will have little difficulty making decisions
because he is less concerned about what others think of him. On the
contrary, an employee with a high level of need for power will try to
influence others and thrives on attention and acknowledgement.

McClelland has maintained that these needs are learned or acquired and
are not instinctive. People need to be trained in order to fulfil those needs.
A training on the need for achievement that was conducted in India
showed good results. Many of the participants have started businesses or

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expanded their business as compared to those who did not attend the

(c) Goal Setting Theory

Towards the end of the 1960s, Edwin Locke introduced the goal setting
theory. According to Locke and his team, a goal is what an individual tries
to achieve. It is the object or target of a specific action.

Goals are objectives that we wish to achieve, e.g. cost reduction, a reduction
in absenteeism and an increase in job satisfaction or performance. For
example, a goal of achieving a sales target of ten units of cars per month for
each salesman, cutting product defect by 5% in comparison to the figures of
the previous month, or aiming for zero accidents at work.

Setting of goals is a process of motivating employees and assisting them in

achieving the expected level of performance. According to Gordon (2001)
and McShane and Von Glinow (2006), in order to be effective, goals must
possess the six characteristics outlined in Figure 4.8.

Figure 4.8: Characteristics of effective goals

Table 4.2 explains the six characteristics of effective goals.

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Table 4.2: Six Characteristics of Effective Goals

Characteristics Explanation

Goal Specificity This refers to the extent the achievement of a goal can be
monitored and measured. For example, goals such as
increasing sales by 50% or reducing absenteeism by 20% by 15
June are more accurate and specific than a general statement
like increasing sales or reducing absenteeism. A specific
goal is able to encourage workers since these measurable goals
enable workers to clearly visualise what is expected from

Goal Difficulty This refers to the level of difficulty for an individual or a

group to achieve a certain goal. For example, raising sales by
5% may be easy, 10% a little difficult but 25% would be
extremely difficult. In order to motivate employees, the goal
difficulty level has to be set at a challenging level. Studies
have shown that performance improves with the increase in
level of goal difficulty to a point when it is no longer
achievable. Setting an impossible goal, in this instance, will
kill motivation.

Goal Acceptance Goal acceptance is readiness in accepting the set goals. Goals
set by higher-ranking staff with power or authority is easier to
be accepted and followed. This affects employee motivation.
However, there are times when colleagues can influence
staffs acceptance of the set goals.

Participation in Goal One way of building or maintaining commitment to a goal is

Setting by involving employees in the process of goal setting. This
will increase commitment to achieving the goal because there
is a sense of goal ownership, compared with goals set solely
by the manager.

Relevant Goals Goals must be relevant to the task or within the control of an
individual. For example, the goal of reducing waste will be of
little value if a particular employee has got nothing to do or
has no control of the production process.

Feedback on Goals Feedback is another factor necessary in setting effective goals.

It enables us to determine whether we have achieved the set
target or are on the right track towards achieving the goal.
Feedback is essential for motivation in view of the fact that
our need for growth cannot be fulfilled until we have received
feedback on our goal achievement.

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The Application of Goal Setting Theory: Management by Objectives

Management by Objectives (MBO) is an example of an application of goal setting

theory. There are four characteristics of an MBO programme. They are as

(i) Specific and clear goals;

(ii) Participative decision making;
(iii) A clear and definite timeline; and
(iv) Performance feedback.

The objective of the MBO must be a clear statement of the intended goals, This
statement must be clear and specific. For example, to increase the sales by seven
percent. This objective is created together between a manager and his/her
subordinates. It is not a goal determined by the management through a top down
or bottom up approach. Instead, it is made by two parties and they must agree
on the mission that they want to accomplish.

Every objective has a timeline to be met, such as a month, six months or a year.
Both parties would work towards achieving that objective in the given timeline.
The final characteristic is that an MBO programme must receive continuous
feedback on its performance. This feedback enables the initiation of strategy and
taking corrective measures if the progress has strayed from its intended


Provide two expectations that can be made about an employee based

on the relationship between the need for achievement and work

(d) Reinforcement Theory

The reinforcement theory states the result or consequences that determine
the behaviour or attitude of an individual. In this theory, reinforcement
such as salary, promotion, a challenging task or compliments are used to
encourage desired behaviour and reduce or eliminate unwanted behaviour.

(i) Types of Reinforcement

The techniques of reinforcement will encourage or reduce the desired
behaviours by utilising or reducing reinforcements. Table 4.3 shows
the four types of reinforcements.
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Table 4.3: The Four Types of Reinforcements

Types Explanation

Positive This means giving rewards or feedback when a desired behaviour

Reinforcement takes place with the hope that the behaviour and result will be

For example, if a sales person achieved a target of selling 10 cars a

month, then the sales person will be given an incentive of RM2,000
on top of his monthly salary.

Reinforcement through this reward would create an employee-

behaviour that encourages them to work harder. A manager may
express compliments every time a sales person gets to sell a car.
However, he may not express compliments when there is no sale.

Negative or Negative reinforcement encourages an employee to avoid

Avoidance unwanted actions by the management, such as tight surveillance
Reinforcement on his work. Those actions will stop when the employee changes
his demeanour to a situation that is desired by the organisation.

An example of negative reinforcement is when there are

complaints about the companys telephonist using harsh language
when answering phone calls. Through negative reinforcement,
you as the manager should scrutinise the telephonists work and
stop doing so if the telephonist changes and gets no more

Extinction Through extinction, managers can eliminate behaviour through

suspended reinforcements. For example, employees that
constantly take sick leave will see their attendance allowances
withdrawn. Through this strategy, employees would not simply
take sick leave. However, suspended reinforcement can also cause
desired behaviours such as productivity, creativity or full
attendance to cease. For example, if an employee works overtime
but does not receive extra payment or compliments for doing so,
there is a big possibility that employee will not work overtime

Punishment Through punishment, you will eliminate unwanted behaviours

with negative events called punishment. Employees who are
always late to work (unwanted behaviour) will have disciplinary
actions taken on them, such as wage deduction (punishment) with
the hope that the employees will not be late anymore.

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(ii) Schedules of Reinforcement

There are two types of schedules i.e. continuous reinforcement and
intermittent reinforcement. Continuous reinforcement involves giving
rewards every time a desired behaviour takes place. On the other
hand, intermittent reinforcement involves the giving of rewards at
determined times. Table 4.4 shows the four types of intermittent

Table 4.4: The Four Types of Intermittent Reinforcement

Types Explanation

Fixed Interval Reinforcement that is given at fixed time such as monthly

salary, annual bonus or annual increments. Normally,
government employees will receive their monthly salary at a
fixed point of time, usually at the end of the month.

Variable Interval Reinforcement that is given randomly such as compliments

by heads of departments or pop quizzes to students.
Lecturers do not have a strict timetable for handing out those
pop quizzes.

Fixed Ratio This is also known as the commission system or piecework.

This is a reinforcement that is given when a target is
achieved. For example, a tailor who can complete 10 pieces of
shirts will be given a commission of RM20.

Variable Ratio Reinforcement given after several actions (behaviours) were

taken and it brought the results desired. For example, a
telemarketing company may only be able to sell its product or
services after making 5, 7, 12 and 20 phone calls to potential

The schedule for intermittent reinforcement can be observed in Table 4.5.

Table 4.5: Schedule of Intermittent Reinforcement

Fixed Interval Fixed Ratio

FIXED Reinforcement given fixed time. Reinforcement given at every
achieved target.
Variable Interval Variable Ratio

VARIABLE Reinforcement given randomly. Reinforcement given after several

behavioural actions were done and
brought results.

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(e) Equity Theory

The psychologist J. Stacey Adams has introduced the equity theory.
According to Adams, there are two main components involved in the
exchange relationship between an employee and an employer, called input
and results (outcomes). An employees input is work, skills, experience and
education, whilst the result that the organisation can give as an exchange to
the employees input is salary, fringe benefits, promotion and recognition.

According to Adams, when an individual suspects injustice, the individual

will act to reduce that injustice to a level that the individual perceives to be
fair and right.

(i) Outcomes of Inequities

An employee will feel uncomfortable and emotionally stressed when
he/she perceives that there exist inequities. If this stress becomes
unbearable, it will motivate the employee to take action to reduce the

According to Berkowitz (as cited by McShane & Von Glinov, 2006),

there are six ways to reduce the feeling of inequity (refer to Table 4.6).

Table 4.6: Six Ways to Reduce the Feeling of Inequity

Ways How

Changing Input Employees who feel that they are below equity will lower their
efforts and performances and just act so that it does not affect their
income. Employees who are overpaid, on the other hand, will
increase their input (very rare) by working harder.

Changing Employees who feel that they are below equity will start asking for
Results an increment in their salaries to match their colleagues. If this
strategy does not work, employees would take follow up actions
such as reporting the matter to their union so that the union would
fight for them.

Changing You will change your perception by saying that the work done by
Perceptions others is not interesting and very boring.

Leaving Work There are employees who try reducing inequity by staying away
from the situation, asking for a transfer, playing truant, going on a
holiday or resigning.

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Taking Action by You will compare yourself with others and come to a conclusion
Comparing with that others possess more experience or work harder or have better
Others positions. You will feel that they deserve more than you because
their work is more complicated or tougher, or they must be more
precise in handling their tasks.
Changing You realise that your co-workers are getting a higher pay package.
Comparisons However, to be comparable, you change your reference by
comparing with others who are earning the same or lower than
you. You might say, at least I am getting higher than what my
father did.


1. Do you agree on the ways to reduce the feeling of inequities we

have just discussed? Why? Present your view during your tutorial.

2. This theory explains how human beings try to obtain justice and
equality by comparing themselves with others. Imagine that you
are an executive accountant and have been working for two years,
and you found out that your coursemate when you were in the
university was offered a job in your company with a salary
package far higher than you for the same position.

How would you feel and what would your actions be?

(ii) Positive and Negative Inequities

Positive inequities take place when you feel that you have received
more than anyone else. Negative inequities, on the other hand, takes
place when you feel that you received less than everyone else.

According to Synder as cited by Schermerhorn (2000), research

indicates that an individual who feels that they have been overpaid,
that is positive inequities, will increase their work quality and
quantity. Those who feel that they are not justly paid, that is, negative
inequities, will reduce their efforts.

(iii) Organisational Justice

Since the 1980s, researchers have started to expand the equity theory
role in explaining employees attitude and behaviour. This brings in
the term organisational justice, which means how far human beings
can consider themselves to be treated fairly at the workplace.

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There are three components in organisational justice. These

components are Distributive Justice, Procedural Justice and
Interactional Justice (refer to Figure 4.9). The best way to create
organisational justice is persuading and giving confidence to
employees that all available resources will be distributed fairly
following clear and transparent procedures. A properly devised
performance evaluation system can reduce dissatisfaction among
employees because the goals are set and informed clearly at an early

Figure 4.9: Three components in organisational justice

(f) Expectancy Theory

The expectancy theory was introduced by Victor Vroom. He developed the
Mathematical Formula of Expectancy Theory in 1964 through his book
Work and Motivation.

In his model, Victor stated:

Motivation = Expectancy Instrumentality Valence

According to this theory, the strength of an individual to do something

depends on his expectation that his actions will deliver some results or
decisions. Those results and decisions would be attractive to that

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For example, assume that you work very hard to complete a chore with the
expectation that the hard work will bring you RM10,000. You work very
hard because that RM10,000 has an appeal to you. On the other hand, you
will not have the motivation to work hard if the benefit that is given is
RM50. The appeal to the reward will determine the effort you put into the

This theory focuses on three types of relationships (refer to Figure 4.10):

Figure 4.10: Expectational theory

Source: Adapted from Robbins, S. P. (2003). Organisational behaviour (10th ed.).
New Jersey: Prentice Hall

Expectancy theory helps explain why employees are not motivated when
carrying out a task and only put in minimum efforts for that task.

According to Robbins (2008), there are three questions that need to be

answered by employees to maximise their motivation.

(i) Firstly, if I were to put my heart and soul into the work, would it be
noted in my performance evaluation?

(ii) Secondly, if I received the best review in my performance evaluation,

would I be rewarded by the organisation?

(iii) Thirdly, if I were to be rewarded, is it attractive to me?

This theory shows how necessary it is that rewards be compatible with the needs
of the individual. Unfortunately, due to the fact that managers have their own
discretion, it is difficult to individualise rewards.

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1. Discuss briefly the relationship between reinforcement and

extrinsic rewards.

2. Inequality in equities can derail work performance. Explain why

this happens.


Consider this situation:

Employees who worked hard and expected rewards were only given a
salary increment, or employees that worked very hard to complete a
task with the hope of being transferred to Kuala Terengganu but instead
were transferred to Johor Bahru.

Would this increase or reduce their motivation? Discuss with your



You now have adequate information about the theories of motivation. Next, we
will discuss what motivates employees to perform. In addition to learning about
the concepts of motivation, you also have to know about job design and
understand how job environment and work place layout can influence/affect
employees behaviour and motivation. Figure 4.11 shows several questions
related to what motivates employees to perform.

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Figure 4.11: Several questions that relate to what motivates employees to perform

Job design is important since it is often related to the quality of work life. Quality
of work life is a management concept that stresses on the physical and emotional
well-being of employees. Job design can also influence performance in certain
jobs, especially those where employee motivation can make a substantial
difference. Lower costs through reduced turnover and absenteeism are also
related to good job design.

Another critical point is that job design can also affect job satisfaction. As people
are more satisfied with certain job configurations than with others, it is important
to be able to identify what makes a good job. Job design can affect both the
physical and mental health of an employee. For example, problems such as
backache or leg pain can sometimes be traced directly to job design, as can stress
which is related to high blood pressure and heart disease.

Therefore, we have to identify the needs of an organisation and its employees

when designing jobs whilst getting rid of barriers that can hinder these needs
from being achieved. As a result, it is hoped that both parties, employer and
employees, are able to achieve their respective objectives successfully.

4.2.1 The Job Characteristics Model (JCM)

J. Richard Hackman and Greg Oldham, two organisational behaviour
researchers, developed the Job Characteristics Model. In general, both
researchers tried to determine how a job should be structured to provide internal
and external motivation to employees.

According to this model, jobs can be described by utilising five dimensions such
as skill variety, task identity, task significance, autonomy and feedback (refer to
Figure 4.12).

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Figure 4.12: The job characteristics model

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

A detailed explanation on these five dimensions are as follows:

(a) Skill Variety

Skill variety refers to the various types of activities required to complete a
job and the extent to which an employee will employ a variety of skills and
talents to complete the said job. For example, whilst a tour bus driver only
requires the skill of driving to perform his/her job, a mechanic must be able
to repair various vehicles such as motorcycles, cars and buses while being
able to diagnose the type of damage that occurred to the vehicle.

(b) Task Identity

Task identity refers to the extent in which the job requires the employee to
complete a whole identifiable piece of work. This might involve different
stages of production, beginning from raw materials to end product or within
certain stages of production only. For example, a tailor has to begin from
cutting a piece of material and sewing the cut pieces to make an outfit that
can be worn by his/her customer. This type of job requires a high degree of
task identity. On another note, a worker or an operator at a television
manufacturing factory may be responsible only for assembling certain parts
of a television. This type of job is described as having a low degree of task

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(c) Task Significance

Task significance refers to the degree of impact a particular task has on the
lives or work of other people. For example, a medical practitioner has a
high degree of task significance as compared to a janitor at the same
hospital. This is due to the fact that the doctor is responsible for ensuring
the good health of his/her patients.

(d) Autonomy
Autonomy refers to the degree of freedom given to an individual in
determining his/her work schedule and the procedures in carrying out the
work. For example, a computer programmer is often given a high degree of
freedom in view of the fact that job creativity and imagination are factors
that cannot be forced onto an individual. A production operator, on the
other hand, is limited to pre-determined targets with the ultimate objective
to satisfy customer needs and demands.

(e) Feedback
Feedback refers to the degree of information an individual obtains on the
effectiveness of his/her work. For example, a production operator who is
assigned to assemble a radio and to test it to ensure good functionality of
all its components is said to have a high degree of feedback. However, the
production operator who assembles the radio is said to have a low degree
of feedback if a quality-control inspector does the testing work.

Referring to Figure 4.12, the first three dimensions, i.e. skill variety, task identity
and task significance are very important to create the feeling that the work done
is meaningful and valuable to the organisation.

In addition, also note that a job that has autonomy gives a feeling of personal
responsibility amongst employees towards results and if the job provides
feedback about work results, employees can be made aware of their level of job

Figure 4.12 also shows that these three psychological states are very important to
an organisation since they are able to increase motivation, performance quality
and job satisfaction, whilst reducing the rate of turnover and absenteeism.


Does the job of a teacher fulfil the needs of the Hackman and Oldham
Job Characteristics Model? Discuss with your classmates the job
elements of a teacher that satisfy each of those characteristics.

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4.2.2 Workplace Environment

Try and reflect on the environment of your workplace. Are you comfortable in
your work environment? Do you have enough space to efficiently carry out your
tasks? Are the lighting and temperature at your workplace comfortable enough
for you?

The above questions are amongst several matters that should be seriously
considered in determining the workplace environment. According to researchers,
a good workplace environment is important since it affects employees job
performance and satisfaction. In this section, we will discuss the physical
environment and workspace design.

(a) Physical Environment

The physical environment consists of the elements around us, which we
can see, feel or hear. Table 4.7 explains the physical work environment that
has been widely studied and has been found to affect workers.

Table 4.7: The Physical Environment Elements Found to Affect Workers

Physical Elements Found to Affect Workers

Temperature High temperature (either warm or hot) is found to have a

negative impact on employees whilst low temperature does not
show any effect on employees except when the skin
temperature of a person falls to a very low level.

However, the comfortable temperature for each individual is

different. What might be a comfortable temperature for one
individual might not be so for another.

Sounds Various types of sounds can create noise. While a constantly

noisy surrounding might not necessarily disturb employees,
such noise might cause damage to an individuals hearing if it is
However, the occasional unexpected noise has been found to
have a negative emotional impact on employees, affecting their
focus on the job.

Lighting Good lighting is also important, especially for jobs that are
complicated and require a high degree of precision. Whilst
improving a low degree of lighting can increase productivity, it
(productivity) is unaffected when a good degree of lighting is
made better.

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Air Quality Air quality at the workplace can affect the health of employees.
Polluted air can cause various types of diseases, which in the
end will have a negative impact on employees performances.
Therefore, a good ventilation system is essential, especially in
closed buildings.

(b) Workplace Design

The design of the workspace can affect an individuals work performance.
Among the aspects to be considered in arranging the layout of the
workspace is the size of the workspace and the arrangement of any

(i) Workspace Size

Workspace size refers to the size of the area for someone to do his/her
job. While there are jobs that can be done in a very small space, certain
jobs require a larger area.

However, this is not the sole factor in determining the size of a

workspace. The comfort of employees is also important to ensure high
performance. In fact, in some organisations, the size of the workspace
is determined by the individuals status in the organisation. The size
of an employees workspace is in accordance to an individuals rank
or status at work.

(ii) Equipment Arrangement Layout

The arrangement layout of equipment has to take into consideration
the distance between the employee and the equipment used, the
distance between two different equipments and the distance between
employees. Suitable distances should be determined in this layout to
avoid jeopardising the employees performance.

(iii) Employee Abilities and Availability

Efficiency consideration must be balanced against the abilities and
availability of the people to do the work. In this context, some jobs
need more training than others. At times, many of the potential
workers lack the related experience needed to do the job. Hence,
considerable attention must be given as to who will be actually
performing the tasks.

(iv) Social Expectations

During the earlier days, securing a job was the primary consideration.
The worker was prepared to work on any job and under any working
conditions. However, it may not be the same these days. Literacy,
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knowledge and awareness of workers have improved considerably.

Also, their expectations from the job have changed. Hence, jobs may
need to be designed to meet the expectations of workers.

(v) Cultural Expectations

When designing jobs for international operations, uniform designs are
almost certain to neglect national and cultural differences. Hours of
work, holidays, vacations, rest breaks, religious beliefs, management
styles and worker sophistication and attitudes are just some of the
predictable differences that can affect the design of jobs across
international borders. Failure to consider these social expectations can
create social dissatisfaction, low motivation, hard to fill job openings
and a low quality of work life, especially when foreign nationals are
involved, either in their home country or overseas.


1. Explain the elements in a job environment that affect job design.

2. List four physical environment elements found to affect workers.


Next, we will focus on job design alternatives. There are several alternatives in
redesigning jobs to make those jobs more interesting whilst fulfilling the five job
dimensions discussed in the Job Characteristics Model. Only four of them will be
introduced, as shown in Figure 4.13.

Figure 4.13: Job design alternatives

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4.3.1 Job Rotation

Shifting an employee from one job to another whilst maintaining the level and
skills required for the new job is known as job rotation. A good example is a
management trainee who is transferred from one department to another for the
purpose of gaining different knowledge and skills. In this instance, job rotation is
also known as cross training.

In redesigning jobs, the main purpose of job rotation is to avoid boredom

amongst employees, especially if they have been doing the same tasks for a long
period of time. By implementing job rotation, employees are able to obtain
various skills whilst making it easy for the management to schedule work, fill
vacancies and do required changes.

4.3.2 Job Enlargement

Job enlargement is the horizontal expansion of a job. This refers to the giving of
several additional tasks to an individual that does not require additional skills
from him. In this instance, the individual applies the same skills he has been
utilising for the current job to the new portfolio. For example, a production
operator at a clothing factory that only sews womens clothing is now given a
chance to sew children and mens clothing.

4.3.3 Job Enrichment

As opposed to job enlargement, job enrichment refers to the vertical expansion of
a job. In this instance, an employee would require new and additional skills to
perform in his/her newly assigned portfolio. For example, the operator at the
clothing factory (who previously only sews clothes) is now given the opportunity
to design, cut, and embroider. Thus, the operator is given the responsibility to
control the planning, execution and evaluation of his or her own performance.

4.3.4 Team-based Designs

Team based job designs are gaining popularity in todays organisational
management. A work team can be effective if it fulfils the job characteristics as
suggested in the Job Characteristics Model. In addition, the team also has to fulfil
the conditions of an effective team.

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1. List four alternatives in redesigning jobs.

2. What is job rotation?

3. Differentiate between job enlargement and job enrichment.


Working hours are typically scheduled for eight hours per day, i.e. from nine
oclock in the morning until five oclock in the evening and for five days per
week. During the mentioned time frame, the employee has to be at the work
place and/or other related places, to carry out their respective duties.

However, there are currently four new alternatives in scheduling working hours,
as shown in Table 4.8.

Table 4.8: Four Alternatives in Scheduling Working Hours

Alternative Scheduling Explanation

Compressed Work Week A compressed work week refers to the reduction of

workdays in a week. The most popular form of a compressed
work week is working for ten hours a day for only four days
in a week. Although the employees will feel very tired at the
end of the workday, it is very well liked because it provides
employees with a longer weekend break.

Flexitime Through flexi scheduling, employees are given the chance to

determine their own working hours whilst being at the office
at pre-determined (by the organisation) core periods. For
example, for an eight-hour work period, the core period is for
six hours, beginning at 9.30am till 3.30pm.
Therefore, if someone wants to leave at 3.30pm, he or she has
to be at the workplace at 7.30am, whilst someone who arrives
at the office at 9.30am can only go home after 5.30pm.

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Job Sharing Job sharing allows two or more employees to share a job. For
example, if two employees share the job as a receptionist in a
private firm, one of them may work in the morning (before
lunch time), while the other will work in the afternoon.
Another form of sharing is in accordance to work days,
where Receptionist A works on Mondays and Tuesdays,
while Receptionist B works on Wednesdays and Thursdays.

Telecommuting Telecommuting is an alternative to the scheduling of work

hours as a result of technological advancements. This refers
to employees who do their work from home using
computers, which are connected to the computer at the office.
Therefore, the employees do not have to be at the office the
whole day. Telecommuting is very suitable for todays work
force because it can increase an employees quality of life,
within and out of the office.


1. List four new alternatives in scheduling work.

2. Give one advantage each from the employee and employers

perspective for each work schedule alternative discussed.


To obtain information on the extent of the implementation of

telecommuting in Malaysia, please visit the following website:

After visiting the website, answer the following questions:

1. What are the opinions of the Malaysian society, the private sector
and the government regarding the execution of telecommuting?

2. What are the forms of preparation that has to be given to the work
force to carry out telecommuting?

3. What jobs are suited for telecommuting?

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Choose the correct answer

1. Workers perception of procedural justice can influence how they

react to perceived inequities.

The above statement refers to which theory of motivation?

A. ERG Theory
B. Equity Theory
C. Expectancy Theory
D. McClellands Theory

2. Which of the statements is false regarding the Goal Setting Theory?

A. Goals should be difficult but realistic and specific.
B. This theory is related to the process of setting preference
goals for employees.
C. Participation and feedback are useful for increasing the
achievement of goals.
D. This theory emphasises on workers perception of the
relationship between efforts, performance and rewards.

3. If the worker becomes frustrated in seeking to satisfy a higher

level need, he or she will continue to be motivated by a lower-level

This statement refers to which theory?

A. ERG Theory
B. Two Factor Theory
C. Goal Setting Theory
D. Maslows Hierarchy of Needs

4. Which of the alternatives below refers to the Hygiene Factors in the

Two Factor Theory?
A. Achievement
B. Responsibility
C. Career advancement
D. Rapport with colleagues

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5. All of the statements below describe McClellands theory of

motivation EXCEPT:
A. People tend to be positive thinkers.
B. People seek feedback on their achievements.
C. People with a low need for power will try to influence others.
D. People with a high need achievement like to establish their
own goals and prefer moderately difficult ones.

A worker who is highly motivated can contribute effectively to an organisation.

A manager needs to also understand the differences between the needs and
necessities of an employee.

Many theories have been discussed on motivation. In addition, their

implications were also discussed.

As a manager or potential manager, you have to understand in detail the

concept and applications of motivation.

There are three early theories of motivation Maslows hierarchy of needs,

theory X and Y and two-factor theory.

There are six contemporary theories of motivation ERG theory, goal setting
theory, equity theory, McClellands theory of needs, reinforcement theory
and expectancy theory.

Job design is a strategy to improve motivation and performance. Jobs should

be well-designed to ensure that employees can carry out their work well and
are always motivated to increase their work performance.

There are five job dimensions in the job characteristic model skill variety,
task identity, task significance, autunomy and feedback.

There are four job design alternatives job rotation, job enlargement, job
enrichment and team-based designs.

There are four alternative work schedules compressed work week,

flexitime, job sharing and telecommuting.

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New alternatives in job designing and scheduling enable organisations to

give new life to jobs that are difficult to be filled or have always been
considered boring.

To increase productivity and the ability to compete, organisations should

seriously consider the importance of proper job design.

Alternatives scheduling Job enrichment

Contemporary theories of motivation Job rotation
Early theories of motivation Job sharing
Job design Motivation
Job enlargement Team-based design

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Topic Work Stress

By the end of this topic, you should be able to:
1. Explain the meaning of stress;
2. Distinguish the six types of stress;
3. Discuss six factors that can potentially cause stress in an organisation;
3. Appraise the three effects of stress on employees and the
organisation; and
4. Evaluate two approaches that can be taken in managing stress faced
by employees.

In most organisations today, work stress has become a widespread problem. It is
said to be one of the main causes of accidents and vandalism at the workplace
(see Figure 5.1).

Figure 5.1: Tired, freaked-out and stressed employee

preparing to smash a computer monitor

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However, there is insufficient data on work stress related to incidences in

Malaysia. Nevertheless, a study conducted by the Bureau of Labour Statistics,
United States found that 1,833,400 injuries and health problems were reported in
1997 of which 3,418 were due to work related stress.

In this topic, we will discuss stress at the workplace. We will also go through
explanations of the causes and the effects of stress to the employees as well as the


We first need to understand the definition of stress. According to Robbins (2008),
stress can be defined as:

A dynamic condition in which an individual is confronted with an

opportunity, constraint or demand related to what he or she desires, and for
which the outcome is perceived to be both uncertain and important. Work
stress occurs when this situation occurs in the context of the workplace.

Although stress is often perceived negatively, not all stress is negative.

Sometimes stress makes us more productive. For instance, stress is felt when the
deadline for a particular assignment approaches. Stress becomes negative when
it affects our physical or mental health and affects our work performance.

Nevertheless, there are instances where stress experienced by an individual does

not lead to stress in other people. How can this be the case? The stress model in
Figure 5.2 explains this.

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Figure 5.2: Stress model

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall


Visit this website to obtain further information on work stress in

accordance to industry and types of jobs in the United States.:

Based on the article, explain in your own words the meaning of work


Next, we will look into several types of stress. According to Collela, Miller, and
Hitt (2006), stress can be classified in various ways, as explained in Table 5.1.

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Table 5.1: Types of Stress

Type of stress Explanation

Emotional stress This stress results when people consider situations difficult or
impossible to deal with. An example of emotional stress is stress
from being observed and monitored closely.

Physiological stress It is the bodys reaction to certain physical stressors. For example, a
persons body can become stressed when he or she fails to get
enough sleep.

Acute stress It is a short term reaction to an immediate threat. For example, an

associate might experience acute stress when being reprimanded
by a supervisor or when not able to meet a deadline.

Chronic stress This results from ongoing situations. For example, it can result
from living in fear of future layoffs or having continuous problems
with a supervisor.

Eustress Eustress is a positive stress resulting from meeting challenges and

difficulties with the expectation of achievement. This kind of stress
is energising and motivating.

Distress As stress increases, it reaches a point at which the effects become

negative. If a high level of stress continues for a prolonged period,
distress or bad stress occurs.


List six types of stress. Provide an example of each type.


Now, we will discuss the sources of stress. With reference to Figure 5.3, there are
many factors than can potentially lead to work stress. These factors can be
divided into three categories (see Figure 5.3).

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Figure 5.3: Factors leading to work stress

5.3.1 Environmental Factors

Environmental factors are events occurring around us. All these are plagued by
uncertainties that can lead to stress. The ups and downs of a business cycle are
normal but this leads to economic uncertainties.

When the economy is down, employees would certainly worry about losing their
jobs or having to accept a pay cut. Political uncertainty also affects people
working in an unstable political climate such as Pakistan and Indonesia, for

Finally, innovation and technological advancements have rendered many work

skills obsolete or to change form. This causes stress among employees as
technological uncertainty poses a threat to their present jobs.

5.3.2 Organisational Factors

There are many factors in organisations that can potentially cause stress. These
factors can be divided into six factors (refer to Table 5.2).

Table 5.2: Organisational Factors that Can Potentially Cause Stress

Factor Explanation

Task Demands The factor that has to do with a persons job, like the design of
the individuals job, working conditions and physical layout.

Role Demands It relates to pressures placed on a person based on the functions

of his/her particular role in the organisation. The types of role
demands are role conflict, role overload and role ambiguity.

Interpersonal The stress created by other employees. For example, lack of

Demands support from colleagues and poor interpersonal relationships.

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Organisational It can be a source of stress especially in terms of rules and

Structure regulations enforced and where decisions are made.

Organisational It represents the managerial style of the organisations senior

Leadership executive/s.

Organisations Life It represents the status of the current stage of an organisation

Cycle which might be at the level of establishment, growth, maturity
or decline. Each stage gives rise to different kinds of stress to


In your own words, explain the six organisation factors that can
potentially cause stress. Give examples for each organisational factor

5.3.3 Individual Factors

Each employee is a normal human being who has a private life outside the
workplace. The day-to-day experiences and problems that an individual goes
through will invariably affect his/her performance at work. Individual factors
that can potentially cause stress include family problems, financial problems and
the individuals personality.


Recall our previous lesson on personality. In your opinion, which type of

personality is prone to stress?


In Topic 2, we established that individuals are different from many aspects of
stress that they experience. Why is there a difference? According to Robbins
(2008), there are at least five variables that determine whether a person will
experience stress when confronting factors that can potentially cause stress.
Those five variables are perception, work experience, social support, belief in
locus of control and hostility.

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What is the relationship between individual differences and factors that

can potentially cause stress?


It should be clear that stress can be a detriment to developing a high
performance work organisation. The following discussion focuses on the
individual and organisational consequences of stress.

5.5.1 Individual Consequences

Individual consequences of stress can be classified as physiological, psychological
and behavioural. However, the consequences of stress can be viewed from three
general symptoms, as shown in Table 5.3.

Table 5.3: General Symptoms of Individual Consequences of Stress

Symptoms Explanation

Physiological Physiological symptoms are caused by high levels of pressure including

Symptoms changes in metabolism, increase of heartbeat and breathing rate and an
increase in blood pressure. All these may lead to headaches and
potential heart attacks.

Psychological One of the psychological symptoms of stress is dissatisfaction. Various

Symptoms studies have been conducted to observe the relationship between work
stress and satisfaction, and the results have shown that employees
who experience high levels of stress are those who are least satisfied
with their jobs (Borg & Riding, 1993; Young & Cooper, 1997). Other
than dissatisfaction with work, other psychological symptoms are
tension, anxiety, boredom, irritability and procrastination.

Behavioural Changes in behaviour brought about by stress include changes in

Symptoms productivity, absenteeism rate and high turnover, as well as changes
in eating habits, increased smoking, consumption of alcohol, rapid
speech and sleep disorders. However, most attention is given to the
effects of stress on productivity or performance.

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As depicted in Figure 5.4, studies have found that stress at low levels can
improve work performance. Only high levels of stress or continuous stress over a
period of time leave negative effects on an employees performance.

Figure 5.4: Relationship between stress and work performance

Source: Adapted from Robbins, S. P. (2008). Organisational behavior.
Prentice Hall: New Jersey, USA


Based on Figure 5.4, explain the relationship between stress and work
performance. Discuss with your coursemates.

5.5.2 Organisational Consequences

Stress has consequences for organisations as well as for individuals. These
consequences are subsequent from the effects on individuals, and include lower
motivation, dissatisfaction, lower job performance, increased absenteeism,
increased turnover, and lower quality of relationships at work.

Research has shown a strong connection between stress, job dissatisfaction,

turnover and health-care costs. Furthermore, some other organisational problems
such as violence and psychological consequences such as anxiety, can lower the
quality of relationships between co-workers, resulting in distrust, animosity and
a breakdown in communication. When employees frequently miss work due to
stress-related illness, their colleagues may become resentful at having to take
over the work while they are absent. Thus, the organisational consequences of
stress can go beyond those that are directly tied to stress, making workplace
stress an even more dangerous and costly problem.

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What is the difference between individual and organisational

consequences of work stress?


Next, we will discuss how to manage stress. In view of the negative effects of
stress on ones mental and physical well being and work performance, stress
should be effectively managed. However, it is important to note that stress
should not be altogether eliminated since low levels of stress have proven to be
beneficial to an organisation. In addition, a manager should also take into
consideration that different individuals have different tolerance levels towards

5.6.1 Individual Approaches

As an employee, an individual can strive to manage the stress that he/she is
experiencing. Some of the strategies an employee can apply to manage stress are
time management techniques, physical exercise, relaxation training and
expanding his/her social support network.

Good time management can reduce the tension at work and physical exercises
can improve heart capacity while providing a mental diversion from work
pressures. At the same time, relaxation techniques e.g. prayer, meditation, yoga
and the like are aimed towards achieving physical and mental rest (refer to
Figure 5.5). In addition, a social support network, for example; family and
friends can lend an ear to the problems faced and give advice from a different
perspective in managing the problems.

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Muslims Prayer Meditation


Figure 5.5: Physical and mental rest; prayer, meditation and yoga

5.6.2 Organisational Approaches

At this point, we have discussed organisational factors that can potentially cause
stress. The management can reduce stress among their employees by supervising
these factors.

Some of the actions that can be taken by the management are ensuring a proper
process of employee selection and placement, taking into consideration factors
like interest, job suitability and personality.

In designing jobs, do not ignore the dimensions discussed in the Job

Characteristic Model. The dimensions include job identity, autonomy and
feedback on goals, which can all reduce stress as they allow employees to have
better control over work activities while reducing dependence on others.

In addition, as discussed in Topic 4, realistic goal setting could be a source of

motivation to employees as well as being able to reduce stress because it
diminishes uncertainty on what needs to be done and the levels of performance
expected. Uncertainties can almost certainly be reduced with improved
organisational communication that lessens role ambiguity and conflict.

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Finally, organisations can provide a variety of facilities to increase employees

mental and physical health. These facilities include an employee gymnasium and
aerobic sessions, workshops to stop smoking, weight reduction and healthy
eating programmes, etc. Figure 5.6 shows an approach by Google.

Figure 5.6: Google acts almost as a self-contained city, offering employees access to many
resources (a gym, for instance) without ever having to leave the workplace


Discuss two approaches that can be used to manage stress among


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Choose the correct answer

1. Which is the consequence of psychological stress?

A. Burnout
B. Abuse and violence
C. High blood pressure
D. Impaired immune system

2. All of the examples below describe organisational and work-related

stressors EXCEPT:
A. Job insecurity
B. Job enrichment
C. Role ambiguity
D. Resource inadequacy

3. All of the statements below are true EXCEPT:

A. Not all stress has negative effects.
B. Stress is highest when demands are low.
C. Many medical problems are attributed to stress.
D. Individual differences can influence how people experience

4. Organisational consequences of stress include all of the answers

below EXCEPT:
A. High turnover rate
B. Decreased safety risks
C. Poor quality of work relationship
D. Increased health care and insurance costs

5. Which of the following statement is true?

A. Organisations can reduce stress by increasing job responsibility.
B. The consequences of stress are mainly for workers only and
not organisations.
C. Workers can reduce or enhance healthy personal habits in
managing their own stress.
D. Eustress is positive stress that results from meeting challenges
with an expectation of achievement.

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Work stress is a factor that should be seriously viewed.

There are six types of stress emotional, physiological, acute, chronic,

eustress and distress.

There are six factors which can potentially cause stress task demand, role
demand, interpersonal demand, organisational structure, organisational
leadership and organisational life cycle.

There are three general symptoms of individual consequences of stress

physiological, psychological and behavioural.

Despite the fact that low levels of stress can boost employees performance,
it can lead to negative consequences if left untreated over a long period of

Accordingly, organisations have to encourage their employees to embark on

activities that will enable them (employees) to manage the causes of stress.

This will lead to better mental and physical health, which will benefit the
organisation as a whole.

Hostility Performance
Managing stress Sources of stress
Perception Stress

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Topic Groups and
By the end of this topic, you should be able to:
1. Differentiate between formal and informal groups;
2. Evaluate models for group development;
3. Distinguish between teams and groups;
4. Analyse the process of rational decision making; and
5. Assess the strengths and weaknesses of individual and group
decision making.

Each individual is a member of a variety of teams or groups. We are a member of
our family and society, as well as citizens of our country. Individuals join a
particular group or team for specific reasons such as security in protecting their
rights, power and influence; socialising to achieve certain goals; and for self-
development. For example, is an online drug information website
which invites individuals to join one or more support groups as a great way to
discover others with related medications and similar conditions. They also can
find more information and share their own experience (refer to Figure 6.1).

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Figure 6.1: Joining a support group such as


The setting up of groups or teams is important as it contributes towards the

effectiveness of an organisation.

In this topic, we will take a detailed look at the types of groups in an

organisation, while discussing the Group Behaviour Model. We will discuss the
differences between teams and groups, identify the types of teams and learn how
to form effective teams. This topic also discusses the differences between work
groups and work teams.


Before we discuss groups in detail, ask yourself this question: do you

like doing group activities and what is your motivation for joining a
particular group?

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Now, we will begin with the definition of groups. A group can be defined as:

Two or more individuals interacting and being interdependent, who have

come together to achieve certain objectives.

An important feature of groups is the communication among members while

having an ideal group size which will enable each member to interact with one
another conveniently.

Table 6.1 shows the explanations and examples of the two types of groups in an

Table 6.1: Types of Groups in an Organisation

Type Explanation Example

Formal A formal group is formed in accordance to the A committee formed

Groups requirements determined by the management of an by a university to
organisation. These groups are formed to carry out study the effectiveness
certain tasks or duties, which will assist their of the courses offered
organisation to meet its pre-determined objectives. by the university.
In most instances, formal groups are established by
a formal figure of authority (within the
organisation) and its membership is publicised
throughout the organisation. Group members will
work according to the ability and needs of the
organisation or individual groups. The group
leader, who is formally appointed, has the
responsibility of ensuring that tasks assigned to
each group member are well executed.

Informal An informal group is formed without the existence When lecturers get
groups of a formal figure of authority and with the general together to conduct
purpose of its establishment being to mutually and extra classes to assist
collectively benefit its members. Various other weak students.
reasons for the formation of informal groups
include looking after the welfare of its group
members and as an avenue to conduct discussions
on employee dissatisfaction.

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Groups can be further classified by the subgroups; command and task groups are
considered as formal groups while interest and friendship groups are informal
groups. Figure 6.2 depicts the classification of groups.

Figure 6.2: Classification of groups

Table 6.2 explains the characteristics of a formal group.

Table 6.2: Characteristics of a Formal Group

Classification Characteristics

Command Group Command groups are determined by the organisational chart. It

consists of individuals that report directly to a particular manager.
For example, a Human Resource Manager and his/her staff are
part of the Human Resource Department.

Task Group Task groups consist of all individuals, who collectively work to
complete a task. This group is not limited by the boundary of
hierarchy. On the contrary, certain situations will result in it going
beyond the hierarchical boundary.

For example, the mentioned going beyond the boundary of

hierarchy occurs when the human resource department works
with the production and finance departments to discuss and
determine the number of production operators and their
respective wages by taking into account the companys financial
In this instance, all command groups are also task groups.
However, task groups are not necessarily command groups since
task groups may go beyond hierarchical boundaries.

The characteristics of an informal group are shown in Table 6.3.

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Table 6.3: Informal Group Characteristics

Classification Characteristics
Interest Group A group of individuals that share a common interest, which
makes them come together to achieve specific goals. A perfect
example is the formation of a badminton club by employees of an
organisation that will enable them to pursue their interest in

Friendship Group It is formed to enable its members to socialise and interact with
one another. This usually occurs after formal working hours or
during weekends. For example, friendship groups formed by
students who normally engage in off-campus shopping activities.

The explanations provided above clearly demonstrate the influence of informal

groups on the behaviour and achievements of the group. There are a few reasons
why individuals like to join a group. Table 6.4 summarises some of the common

Table 6.4: Reason Why Individuals Join a Group

Reasons Explanation
Security By joining a group, individuals are able to reduce their feelings of
insecurity. Being in a group makes them feel safer, more confident
and less susceptible to threats.

Status Membership in a certain group can increase other peoples

acceptance and recognition of an individual.

Self-esteem Groups can provide people with feelings of self worth. Inclusion
in a certain group, for example, a member of a professional
organisation or being on the board of directors of certain
organisations, provides prestige to an individual.

Affiliation Groups can fulfil an individuals social needs by providing an

avenue for members to interact, hold discussions and exchange
ideas. Interaction at work is the main source of fulfilling an
individuals need to interact.

Power Groups are able to exert greater power and influence during
decision making as compared to a single person.

Goal Achievement Working in groups enables a difficult task to be accomplished.

Groups improve productivity as they consist of a pool of skills
and expertise, and shared strengths.

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State the differences between the discussed groups: command, task,

interest and friendship.

6.1.1 Stages in Group Development

The evolution of a group usually undergoes specific stages and these are
depicted in the Five-stage Model of Group Development. However, current
studies have indicated contrary findings pertaining to temporarily formed
groups (formed to accomplish specific tasks within a specific time frames) that
do not go through these stages. We will review these two models, namely Five-
Stage Model and Alternative Model, with the latter being more suitable for
transient groups.

Tuckmans Five-stage Model states that the development of a group goes

through five stages, which are forming, storming, norming, performing and
adjourning. These stages are depicted in Figure 6.3 which indicates how an
individual measures his level of independence when joining a group. The
duration and intensity of each level are not necessarily the same.

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Figure 6.3: Tuckmans Five-stage Model

Source: Adapted from Kreitner, R. & Kinicki, A. (2008).
Organizational behavior. McGraw-Hill Companies

The explanation of Tuckmans Five-stage Model is as follows:

(a) Forming
This is an ice-breaking stage, which is also known as mutual acceptance.
During this stage, all members of a group meet for the first time.

At this point of time, members usually tend to avoid interacting with one
another and will try to act independently. They will attempt to identify
what needs to be done, what needs to be accepted and things to avoid
within the group. The existing discomfort diminishes when members get to
know each other better and accept their presence as members of a new

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This stage is also a stage of uncertainty (about the purpose of the group,
power relations and interpersonal relations) and emphasis is placed on
orientation and adaptation among group members.

(b) Storming
During this stage, group members begin to learn to accept each other,
conduct discussions and openly make decisions. Sooner or later, members
will gain confidence to participate in group related activities.

Intra-group conflicts will also occur at this point of time as a result of

members beginning to express their individuality by exercising leadership.
As group rules become more established, members begin to discover their
respective role/s within the group.

Conflict ends when the group structure solidifies via the consensual
appointment of a leader and with each member understanding his/her
respective role, responsibility and authority. This stage will witness
interdependence within members of the group.

(c) Norming
At the norming level, all conflicts and disagreements are resolved,
relationships develop and members of the group demonstrate cohesiveness.
There will be cooperation among members in order to get the best results.

Cohesiveness develops because the goals, expectations and rules of the

group are now clear. Managers should encourage groups to maintain good
working relations, as the setting of norms and values is instrumental to the
success of a group.

(d) Performing
At this stage, all issues pertaining to the structure of the group are settled.
The group now functions as one unit. The group will now focus on the task
at hand. The group is now productive as each member goes about his/her
set task.

(e) Adjourning
Finally, the group gets to the adjourning stage. This is especially so for
groups established for specific purposes or with pre-determined and
limited tasks, i.e. special committees or project teams.

Dissolution or adjournment takes place after the pre-determined tasks have

been accomplished and the goals are achieved. Here members are once
again free to pursue their own work.

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Whilst not all groups necessarily undergo the stages mentioned, an

understanding of these stages will assist managers to form effective and
productive groups. In addition, managers should note that there are
differences between new and mature groups with the challenge being in
setting productive targets for mature groups.


1. Explain the five stages that each group member will go through.

2. Discuss which stage in Tuckmans Five-stage Model is the most

difficult when handling group issues.

6.1.2 Alternative Model: Punctuated Equilibrium

This model is suitable for temporary or transient groups with specific deadlines.
Studies have shown that these groups have a unique sequence of actions, which
is shown via the Punctuated Equilibrium Model as shown in Figure 6.4.

Figure 6.4: Punctuated equilibrium model

Source: Adapted from Robbins (2008)

The following explains the Punctuated Equilibrium Model:

(a) The First Meeting Sets the Groups Direction

During the first meeting, a framework for behavioural patterns and
assumptions made by the group is made known. Behaviour patterns can
appear as early as the first few seconds after the group is formed.

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(b) The First Phase of Group Activity is One of Inertia

After goals have been set, they will be written down and normally would
not be revised throughout the first phase. This is a time of inertia, when the
group is more static, focusing on the set goal.

(c) A Transition Takes Place at the End of this First Phase when the Group has
used Up Half of Its Allotted Time
An interesting discovery made in these studies was that despite the fact
that several of these groups spent as little as an hour on their projects while
others took six months, each group experienced its transition at the same
point in its calendar, which is precisely half way between its first meeting
and its official deadline. This transition makes the group appear to have a
mid life crisis. This midpoint appears to work like an alarm clock,
heightening members awareness that their time is limited and that they
need to get moving.

(d) A Transition Initiates Major Changes

This transition ends Phase 1 and is characterised by concentrated changes
via the dropping of old patterns and adoption of new perspectives. The
transition sets a revised direction for Phase 2.

(e) A Second Phase of Inertia Follows the Transition

Phase 2 is a new equilibrium or period of inertia. In this phase, the group
executes the plans created during the transition period.

(f) The Groups Last Meeting is Characterised by Accelerated Activity

The final meeting is the last activity in accomplishing the task.

In conclusion, this model cannot be applied to all groups. It is basically meant for
groups that are temporary or transient in nature and with limited time for the
completion of projects.


Compare and contrast the two models of in-group development stages.

You may use a table to show your comparison.

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6.1.3 Group Behaviour Model

We will now look into the Group Behaviour Model. Figure 6.5 shows the main
components influencing the performance and satisfaction levels of groups. The
following discussion is based on this model.

Figure 6.5: Group behaviour model

Source: Robbins (2008)

6.1.4 External Conditions Imposed on Groups

Before we try to understand the behaviour of a work group, we need to
understand that groups are part of a bigger organisation. Therefore, a group is
influenced by external conditions, i.e. an organisations overall strategy, the
structure of authority, formal regulations, resources, employees selection
process, performance appraisal and reward system, and culture and workplace

(a) Organisation Strategy

The top management of an organisation determines its overall strategies.
The figures of authority are also responsible for setting the goals of the
organisation and the means and ways of achieving the set goals and
objectives. For example, they can instruct an organisation to reduce cost,
improve quality, broaden the share market or streamline operations.

These strategies can influence the power of various work groups especially
in terms of determining the resources needed to accomplish their respective
tasks. For example, when an organisation undergoes downsizing that
results in the organisation being closed down or having a large part of its
operations being sold, anxiety and fear among members of its work groups
will occur and this can potentially lead to internal conflict within the
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(b) Structure of Authority

Organisations that have a structure of authority are easily able to define
their reporting hierarchy, with individuals or groups being fully aware of
the decision maker/s and types of decisions made. Structure determines
where positions of work groups are within the organisational chart, who
the formal head of a particular group is, and formal relations between

(c) Formal Rulings

Organisations set rules, policies, job descriptions and other forms of formal
rulings to standardise employee behaviour. As regulations imposed on all
employees become more formal, employees imposed behaviour becomes
more consistent and predictable.

(d) Organisations Resources

Resources available in an organisation, i.e. money, time, raw material and
equipment can significantly affect group behaviour. Some organisations
have ample resources so their employees enjoy modern, sufficient and
quality equipment. In contrast, the conduct of group activities is adversely
affected in organisations with limited resources.

(e) Employee Selection Process

A member of a work group is also a member of the organisation because
the group is a part of the organisation. Accordingly, the criteria employed
by the organisation for employee selection purposes will also be used to
decide who becomes part of a group.

(f) Performance Appraisal and Reward System

Another variable that can affect all employees is appraisal conducted by the
organisation and the rewards system. Does the organisation provide
specific, challenging and achievable goals? Does the organisation reward
both individual and groups for the achievement of goals?

Since groups are part of a bigger organisation, the behaviour of group

members is also influenced by the manner in which organisations appraise
a certain task that has been achieved and the kind of behaviour that is

(g) Culture
Every organisation has its own culture, which clearly indicates to its
employees, the standard for acceptable or non-acceptable behaviours.
Individuals will begin to understand the culture being practised within an
organisation after having worked for a few months with the organisation.

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While group members might have their respective subculture, they would
also need to conform to the organisations general culture. In this instance,
subculture refers to the culture practiced solely by certain groups within an

(h) Workplace Conditions

Finally, work group behaviour is also influenced by the condition of the
workplace as provided by the organisation. The architect, industrial
engineer and office designer respectively decide on the size and physical
layout of an employees work space, the location of equipment, as well as
lighting and acoustic needs with the main purpose of providing a
pleasant work environment. All these can simultaneously be obstructions
and opportunities for the interaction of work groups.

6.1.5 Resources for Group Members

The potential achievement of a group is dependent on the resources available to
group members. This section discusses two obvious general resources, as shown
in Figure 6.6.

Figure 6.6: General resources available to group members

The explanations of the general resources available to group members are as


(a) Personal Capability

Capability refers to an individuals level of knowledge, available skills and
abilities. A significant part of the potential achievement of a group can be
anticipated by assessing the knowledge and abilities of each member.
While it is true that an excellent coach and a high level of team spirit is able
to ensure for its success despite the team having moderate players, this
does not necessarily happen at most times.

Evidence shows that there is a positive correlation between good

interpersonal skills and group achievement. This refers to the management
and resolution of conflict, cooperation in problem solving and
communication skills. For example, group members have to know the
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nature and source of any conflict faced by the group and use an
appropriate conflict resolution strategy; they need to identify the situation
that calls for collective problem solving and encourage full participation of
group members. Most importantly, all of them should be good listeners.

(b) Personality Traits

Numerous studies have also shown a strong relationship between
personality traits and group behaviour and attitude. Characteristics that are
positively related with our culture also contribute positively to
productivity, team spirit and group cohesion or group unity.

These characteristics consist of friendliness, initiative, openness and

flexibility. Conversely, negative characteristics like authoritarianism,
dominant personalities and unconventionality display a negative
relationship with productivity, team spirit and group cohesion. Personality
traits also affect group performance in terms of how individuals interact
with other members within the group.


Explain how the two main resources available to a group can influence
the groups achievement level.

6.1.6 Group Structure

All work groups have their respective structure that shapes the behaviour of
their members and makes it possible to explain and predict a large portion of
individual behaviour within the group as well as the performance of the group

What defines group structure? Group structure includes the following elements:

(a) Formal Leadership

Nearly all work groups have a formal leader. The leader is normally known
as a unit or department manager, supervisor, project leader and head of a
particular committee. Leaders play an important role in the success of a

(b) Roles
Each member of a work group has his/her own role to play with a set of
expected behaviour patterns accompanying his/her position and
responsibilities within the group.
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In addition, each person may have more than one role to play at any given
time within his/her different groups. A simple example is while we may be
a manager at the work place, we are also a member of a particular society
or head of a family. These various roles invariably influence our behaviour.
As a manager, we may behave in a more serious manner as compared to
when we are at our social meetings or with our family.

(c) Norms
All groups have established norms. These norms, which strongly influence
work behaviour are defined as acceptable standards of behaviour that are
shared by members of the group. Norms provide a guideline to members
on what ought and ought not to be done under certain circumstances.
Usually it has to do with a positive trait like a high degree of commitment
in the organisation, faith in senior management and a high degree of
satisfaction towards the job and organisation.

At most times, the organisation we are in has indirectly clarified what is

expected from us in a particular situation. For example, we come to work at
a specific time and if we fail to do so, our attendance allowance will be

An effective work group will establish norms on quality, punctuality,

absenteeism, safety, honesty in giving ideas and others. However, norms can
also induce negative behaviour when it encourages group members to
damage companys property, offend co-workers and jeopardise the
companys image. An individual will have greater tendency and frequency
to behave negatively if he/she stays for a long time in a group with negative

(d) Group Status

Status is a socially defined position or rank given to groups or group
members by others. Awarding of status can influence the behaviour of
groups. Whenever there is inequality in status among members of a group,
the productivity and an individuals desire to continue staying with the
group will be affected. Groups usually reach a consensual agreement on the
status and the position of individuals in a group.

(e) Group Size

Group size also has an effect on the overall group behaviour with
numerous studies indicating that smaller groups are more productive than
larger ones. On the other hand, larger groups deal better with problem
solving since more ideas are put forth.

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The goals of a group are an important factor to consider when determining

the size of a group. For instance, a larger group is required if its goal is to
collect facts while a smaller group is more suitable if the aim of the group is
to provide input.

One of the most common problems faced by larger groups is social

loafing which is the tendency for individuals to spend less effort when
working collectively as compared to when they are required to work

Studies on the sizes of a group have discovered these two things:

(i) Groups with an odd number of members tend to be preferable to
those with an even number; and
(ii) Groups made up of five or seven members are more effective than
smaller or larger groups.

(f) Group Composition

Most group activities require skill and knowledge. When the group consists
of various personalities - gender, age, education level and experiences, the
greater the chances are for that group to accomplish its task successfully.
This shows that heterogeneous groups are more effective compared to
homogeneous ones because they possess more abilities, skills, and
information as a result of having members from a variety of backgrounds.
However, it is also worth noting that both heterogeneous and
homogeneous groups have their own strengths and weaknesses.

(g) Cohesiveness
Groups differ in their level of cohesiveness, which is the degree of closeness
that members feel towards each other and are motivated to stay in the
group. For instance, some work groups are cohesive because the members
have spent a great deal of time together; the groups small size facilitates
high interaction; or the group has experienced external threats, which has
resulted in its members becoming very close. Cohesiveness is important
since it has proven to be positive towards the productivity of a group.

Cohesion, in the meantime, is able to decrease staff turnover, increase

cooperation among team members and ensure consistent performance.

How do we encourage group cohesiveness? Firstly, ensure that all

members attend activities or meetings. Create opportunities for members to
cooperate. For example, instruct them to redo their work schedule. When a
task is scheduled in a manner that requires interdependence on other group

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members, people will tend to give better cooperation, resulting in better

cohesion. For example, activities such as family day, sports day and other
social activities can improve cohesion.


Using a mind map, briefly explain the structure of groups.

6.1.7 Group Processes

The Group Behaviour Model also consists of the following processes, as shown
in Figure 6.7:

Figure 6.7: Group behaviour model processes

Why are these processes important in understanding group behaviour? To

answer this question, we need to re-look social loafing. In work groups with a
loosely defined individual contribution, there is a tendency for individuals to
reduce their effort. In other words, social loafing reflects the loss of certain
processes due to the formation of a group.

Group processes can also produce positive results, which include higher output
as opposed to the input provided to the group. This can be seen in heterogeneous
groups where a wide range of creative alternatives can be generated.

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Figure 6.8 shows how group processes affect the effectiveness of groups.

Figure 6.8: Effects of group processes

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

6.1.8 Group Task

Tasks can be classified as either simple or complex. A routine or standard task is
usually simple. A complex task is often unusual (not in the norm) and is seldom
carried out.

We can form a hypothesis by saying that the more complex a task, more benefits
will be obtained from the group discussion on issues pertaining to alternative
ways of performing the task. If the task is simple, group members simply need to
follow the standard procedure in performing the task without the need to discuss
the alternatives. Similarly, group members need to interact more often if the
degree of task dependency is high. Group performance is greatly improved via
effective communication and a minimum level of conflict among members.

To conclude, tasks that have a high degree of uncertainty, i.e. that are complex,
requiring a high level of interdependence between members and the need for
more information, are important for better in-group processes. However, groups
with poor communication, weak leadership and a high level of conflicts will
ultimately have poor performance irrespective of the type of tasks assigned. On
the contrary, groups with simple tasks requiring a low level of interdependence
among group members can also be effective groups.

6.1.9 Implications of Group Models to Managers

The conclusion made is based on the Group Behaviour Model with the
implications on performance and satisfaction.

The components in the Group Behaviour Model can lead members of a group to
develop effective groups. Effective groups can improve performance and
satisfaction of its members and ensure success of the organisation. Effective

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groups are groups that have creative ideas, accomplish their tasks and can adapt
to any changes. Group members will be more involved with the group and goals
of the organisation.

So as a manager, we need to see and assess the strategies required to develop

effective groups in an organisation. Elements that need extra attention are those
involving people, organisation and the assigned task/s. A high degree of
understanding between the group leader and his/her members also has a
positive effect on the performance and satisfaction of group members.


The team approach in managing organisations has an important effect on the
organisation as well as individuals within the organisation. Teams are the
foundation for a progressive management in the future.

According to management expert, Peter Drucker, future organisations will have

a more horizontal organisational chart; will be information based; and organised
into teams. Therefore, teamwork skills will soon be essential for all individuals in
an organisation.

Teams are useful in performing complex tasks, which are interdependent and
require diversities. For tasks requiring multiple skills, sound judgment and
experience, teams are known to be more effective than individuals. If an
organisation were to restructure its processes to be more competitive, the team
approach should be applied since talents can be fully utilised.


Before we proceed with our discussion on teams, has it ever occurred to

you that teams are different from groups? On the contrary, are teams
similar to groups? If they are indeed different, what are the differences?

We defined work groups as two or more individuals that interact and are
interdependent on one another in order to achieve an objective. Work groups are
made up of group members that interact with the aim to share information and
to make decisions, enabling each member to perform within his/her area of

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Work groups have neither the need nor the opportunity to be involved in
collective work that requires a joint effort. Its performance is merely the
culmination of each individuals contribution.

Figure 6.9 depicts the differences between work groups and work teams. This
definition explains why many organisations today, which are seeking for a
positive synergy to increase the organisations performance are restructuring
their work processes around work teams.

Figure 6.9: A comparison between work groups and work teams

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

The widespread implementation of teams across organisations enables them to

generate more output without any additional input. This however, is only a
potential. It does not mean that when a group is converted into a team, it will
guarantee the achievement of a positive synergy.

A successful team usually possesses certain characteristics that lend itself

towards team effectiveness. Therefore, if a management wishes to improve the
performance of an organisation by forming teams, they need to ensure that their
teams possess the characteristics that support the improvement of the
organisations performance.


Do you agree that teams and work groups are different? Why?

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6.2.1 Types of Teams

Teams can be classified in terms of their objective. In general, there are four types
of teams in an organisation, which are problem solving, self-managed, cross-
functional and virtual (see Figure 6.10).

Figure 6.10: Four types of teams

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

We will now look at the detailed explanations of these four types of teams.

(a) Problem Solving Teams

Approximately 20 years ago, teams were just gaining popularity and most
of them had similar forms. These teams were typically composed of five to
twelve employees from the same department who met for a few hours each
week to discuss ways of improving quality and efficiency at all levels of the
organisation. These are known as Problem Solving Teams.

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In problem-solving teams, members share ideas and offer suggestions on

how work processes and methods can be improved. When a decision is
reached, they will put forward their proposal to the management, who in
turn will either respond positively to the proposal by fully implementing it,
or make some minor adjustments before implementing the proposal, or
obtain additional information in order to evaluate it prior to its

(b) Self-managed Teams

A self-managed team consists of individuals who undertake the
responsibilities of their respective supervisors. The duties of these teams
typically include planning, conducting, influencing and controlling their
work processes with minimum monitoring and instruction from the
management. Team members are usually highly skilled and trained
individuals who have the responsibility and authority to conduct specific

Activities normally done by the management such as scheduling of work,

leave, performance appraisal, setting of salary scale and reward for each
employee, or placement of orders for raw materials to be used in
production, etc, are passed on to this team.

(c) Cross-functional Teams

This work team is made up of individuals from a variety of work areas and
functions like marketing, human resource, production, finance and others.
They are usually of the same rank, and focus on one common goal.

Since the team members are from a variety of work areas and functions
with a wide range of experience and knowledge, this team is able to see a
problem from a variety of perspectives and is able to generate a lot of ideas
and alternative solutions. A cross-functional team can also act as a self-
managed team and coordinate all department activities within an

In conclusion, cross-functional teams are an effective way to enable

employees from various work areas to gather and exchange information,
generate new ideas, solve problems and undertake unique projects.

Examples of cross-functional teams are teams that have been formed to

select and introduce new technology in an organisation, to improve
marketing effectiveness or a team formed to control the cost of raw

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(d) Virtual Teams

While all the above-mentioned teams perform their work face-to-face, a
Virtual Team uses computer technology to connect its members (who are
physically dispersed) to achieve a common goal. They allow people to
collaborate online, using communication links like wide-area networks
(WAN), video conferencing, Internet, groupware, e-mail or fax.

Virtual teams are able to perform similar tasks as the other mentioned
teams, such as to share information, make decisions and complete tasks.
Virtual teams are more flexible and efficient because they are guided by
information and skills and not constrained by time or location factors like
the other teams. Anyone who has the information or required skills can be
a member regardless of where they are or when they work. Team members
can either be individuals of the same organisation or people from various
organisations, e.g. suppliers or business partners.

A virtual team is different from other teams due to the absence of para-
verbal and non-verbal cues, limited social context and the ability to
overcome time and space constraints.

In face-to-face conversations, we use a lot of para-verbals (tone of voice,

inflection, volume) and non-verbal cues (i.e., eye contact, facial expression,
gestures). These signals help to convey additional information to the other
party. Virtual teams are deprived of these para-verbal and non-verbal cues
since they interact online. Members of virtual teams typically have less
social interaction, more so if they have yet to know each other.
Consequently, virtual teams often report a lack of satisfaction with its team
interaction process as compared to the other teams.

On the contrary, virtual teams can overcome time and space problems since
its members are not required to meet face-to-face to complete their
determined task(s).


Discuss the four types of teams and highlight the differences between

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6.2.2 Creating Effective Teams

Let us look at how to create an effective team. What is team effectiveness? In
normal circumstances, team effectiveness encompasses the productivity of a
team; its managers assessment of the teams performance and the satisfaction
level of its members. Figure 6.11 shows the Team Effectiveness Model.

Figure 6.11: Team effectiveness model

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

6.2.3 Work Design

To be an effective team, members of the team must work together whilst taking
collective responsibilities to complete a task. In this instance, work design
includes variables such as freedom and autonomy of team members, the
opportunity given to the members to use their respective skills and talent,
members ability to complete a whole and identifiable task or product whilst
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working on a task that has substantial impact on others.

The work designs characteristics mentioned above greatly enhance the

motivation of team members and increases team effectiveness by boosting the
members sense of responsibility and ownership over their work.

6.2.4 Composition
Composition refers to the variables related to the forming of effective teams. In
this section we will discuss the ability and personality of members, allocation
and diversity of roles, size of team, members flexibility and members preference
for teamwork.

(a) Members Abilities

A team requires three different types of skills:
(i) Technical;
(ii) Problem-solving and decision making skills to enable identification of
problems, determination of solutions and alternative solutions,
evaluation of solutions and alternative solutions, and the ability to
make competent choices; and
(iii) Interpersonal skills, which consist of the ability to listen well, and to
provide sound feedback and superior resolutions to conflicts.

All three of the mentioned skills must be developed to enable a team to

maximise its performance and to achieve success.

(b) Personality
As we had discussed in Topic 2, personality has a substantial influence on
the behaviour of individuals. Consequently, individual behaviour can
influence the behaviour of a team. Many of the dimensions identified in the
Big Five Personality Model have proven to be relevant towards team
effectiveness. Specifically, a team that possesses higher levels of extroversion,
agreeableness, conscientiousness and sound emotional stability tend to
receive higher managerial ratings for team performance.

Therefore, the existence of a single person with low agreeableness,

conscientiousness or extroversion is more than sufficient to give rise to
tension in the internal process of a team, which will eventually affect its

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(c) Allocation of Roles and Diversity

Different teams have different needs. Therefore, it is essential to select the
necessary people to fill the specific roles required for a particular team.
There are nine identifiable team roles as shown in Figure 6.12. A successful
work team has the right individuals to fill the said roles, with the selection
being done based on the skills and preferences of the selected individuals.

Figure 6.12: Key roles of teams

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

While individuals play multiple roles in most teams, managers need to

understand the strengths of each to be able to derive maximum and
meaningful contributions from the team members. Managers need to select
team members based on their strengths and allocate work assignments that
match their preferred styles. By matching individual preferences with the
demands of team roles, managers increase the likelihood of team members
working cohesively with one another.

(d) Size of Team

An effective team should not be too large or too small. A large team will
result in problems pertaining to interaction whilst experiencing problems in
reaching an agreement, decline in cohesiveness, efficacy and accountability.
On the contrary, a team that is too small also will lead to a lack of diversity,

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whereas teams having more than ten people will not be able to attend to a
task efficiently. Ideally, a manager can establish an effective team,
consisting between five to twelve persons.

(e) Flexibility of Members

A team that is made up of flexible individuals greatly improves its
adaptability and makes it less reliant on any single member since team
members are familiar with the tasks of co-members, enabling them to
complete each others tasks with ease. This is an advantage when a
particular member is absent and/or when there is a turnover of team
member(s). In this instance, the management does not have to worry about
finding a suitable replacement nor finding the need to train an existing staff
to complete the task(s) on hand. Therefore, to maintain performance at an
optimum level, managers must select members who are flexible, and
provide them with cross training so they can perform any task assigned to

(f) Preferences of Members

Not all employees of an organisation are members of teams established by
the organisation. If given a choice, most employees will avoid from
becoming a member of teams within an organisation. Often times, when
individuals who prefer to work on their own are instructed to form a team,
they are unable to give their full commitment to the team, leading to poor
team spirit.

Therefore, the preferences of individuals in an organisation should be

considered on an equal ground as their respective abilities, personality
traits and skills, prior to requesting these individuals to become a member
of a particular team within an organisation. High performing teams are
made up of those who enjoy working in teams since they are fully
committed to their respective teams.


The composition category can increase the effectiveness of teams. In

order to reinforce your understanding of the composition category,
elaborate on how the related variables contribute towards the formation
of an effective team.

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6.2.5 Context
There are three contextual factors that can significantly affect the performance of
teams as shown in Table 6.5.

Table 6.5: Contextual Factors that Reflect the Contribution of Teams


Adequate The team model discussed earlier has established that teams are part
Resources of a larger organisational system. Therefore, all work teams must be
sustained by the resources available within their respective
organisations. Limited resources will directly affect the ability of a
team to accomplish its task.

A study concluded that among thirteen factors potentially related to

group performance, the most important factor affecting team
effectiveness is the support it receives from its organisation. This
support includes timely information, proper equipment, adequate
staffing, encouragement, and administrative assistance. Teams must
receive the necessary support from management and the larger
organisation if they are to succeed in achieving their goals.

Leadership Teams also need leadership and structure for direction and focus.
and Structure Team members must agree on segregation of responsibilities, while
ensuring that all members of a team have an equal share of the
workload. In addition, teams also need to determine work
schedules, development of required skills, resolution of conflicts,
and decision making and modifications to the decisions that have
been made.

Agreeing on the specifics of work and how they fit together to

integrate individual skills require team leadership and structure.
Leadership and structure can also be provided indirectly by
management or even by team members in the process of fulfilling
their roles as listed in Figure 6.12.

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Performance How do we get team members to be both individually and jointly

Evaluation and accountable? We can do this by modifying the traditional
Reward individual-oriented evaluation and reward system to a system that
System reflects team performance instead.

Individual performance, fixed wages, individual incentives and the

like are not consistent with the development of high-performance
teams. So we need to develop an appraisal system that emphasises
teamwork and collective achievement.

Apart from evaluating and rewarding employees on the basis of

individual contribution, management needs to consider group-
based appraisals, profit sharing, gain sharing, small-group
incentives and other system modifications that will reinforce team
effort and commitment.

6.2.6 Process
The final category related to team effectiveness is process variables. The
following explains these process variables:

(a) Common Purpose

Effective teams have a common and meaningful purpose that provides
direction, momentum and commitment to members. Members of successful
teams put a tremendous amount of time and effort into discussing,
shaping, and agreeing on a purpose that belongs to them both collectively
and individually since this purpose is the vision of the team and broader
than specific goals.

This common purpose, when accepted by the team, is essential as it

provides the team with direction and guidance.

(b) Formulating Specific Goals for the Team

Successful teams translate their common purpose into specific, measurable
and realistic performance goals. As explained in Topic 4 (which is on
motivation), goals lead individuals to higher performance; energise teams
and help team members keep their focus in making decisions. In addition,
consistent with the research on individual goals, team goals should be

Challenging goals have been found to raise team performance on the

criteria for which they are set. For instance, goals for quantity tend to raise
quantity, goals for speed tend to raise speed and goals for accuracy tend to
raise accuracy.

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(c) Team Efficacy

Effective teams have confidence in themselves, believing in their ability to
succeed. A teams success will contribute towards its members confidence
and motivation for future successes.

What can the management do to increase team efficacy? There are two
possible options; one of them is assisting the team to achieve small
successes and providing skill training. Small successes build team
confidence and the team will strive even harder to achieve even greater
successes in the future. In addition, managers should consider providing
training to improve the members technical and interpersonal skills. The
greater the abilities of team members, the greater the likelihood that the
team will develop confidence and capability to deliver on that confidence.

(d) Conflict Levels

When the behaviours or beliefs of a team member are unacceptable to other
team members, conflict occurs. Several types of intra group (within team)
conflict which exists are:
(i) Personal conflict results when team members simply do not like each
(ii) Substantive conflict occurs when a team member disagrees with
anothers task related idea or analysis of the teams problem or plans;
(iii) Procedural conflict occurs when team members disagree about
policies and procedures.

Conflicts within a team are not necessarily negative. Teams that do not face
any conflict are likely to become apathetic and stagnant. Conflict can
actually improve team effectiveness with the exception of relationship
conflicts (those based on interpersonal incompatibilities, tension, and
animosity towards others), which are almost always dysfunctional.

However, for teams that perform non-routine activities, disagreements

among members about task content (known as task conflict) are not
detrimental. In fact, this type of conflict is often beneficial because it lessens
the likelihood of groupthink. Task conflicts stimulate discussion, promote
critical assessment of problems and options, and can lead to better team
decisions. Appropriate levels of conflict will characterise the effectiveness
of a team.

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(e) Social Loafing

We have learned that individuals could take cover within a group. They
can engage in social loafing and coast on the groups effort because their
individual contributions cannot be identified. Effective teams undercut this
tendency by holding themselves accountable on both the individual and
team levels.

When members are clear on what they are responsible for individually and
jointly, they will give their full commitment to the team.

(f) Social Facilitation

Research suggests teamwork can lead to increased performance because
others are present. According to Collela, Miller and Hitt (2008), some
reasons for social facilitation have been suggested. The presence of human
beings creates general arousal in other human beings. This general arousal
then leads to better performance. Another explanation is that the presence
of others could arouse evaluation apprehension, so they can perform better
because they think they are being evaluated. Lastly, the presence of others
can actually decrease performance on tasks that are complex or unfamiliar.
For example, someone who is not accustomed to giving speeches is likely to
perform more poorly when speaking in front of others than he/she would
if he/she was practicing alone.


Go to to obtain
more information on factors that lead to the success of a team. interviewed 15 leaders from various industries to
learn the secrets of team efficacy. List the factors and discuss these
factors during your tutorial.

6.2.7 Turning Individuals into Team Players

While research has proven the value and popularity of teams, not many people
are natural team players. Instead these individuals are people who want to be
recognised for their individual achievements.

Organisations too have been known to nurture individual accomplishments.

They have created competitive work environments in which only the strong will
survive. So how does an organisation instil the spirit of teamwork among its
members? There are a few things that managers need to consider in nurturing
team spirit among individuals.
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(a) Top Management Support

Effective team work requires support from the top management. Some
organisations that are known for their teamwork such as Xerox, FedEx, and
Boeing have top management teams that actively promote teamwork.
According to Sundstorm (1999), several management practices can help a
management to support team effectiveness:
(i) Have an explicit vision and strategic plan that serves as the basis for
determining the desirable team outcomes;
(ii) Use results-oriented measurement of outcomes and expect all leaders
in the organisation to do the same;
(iii) Actively include associates at all levels in the decision-making
process; and
(iv) Actively manage and review support systems for teams.

(b) Support System

Support systems are aspects of an organisational life that allows a team to
function well. Support systems include:

(i) Technology
It is important that teams have access to the technology they need to
do their work. This includes the technology necessary to carry out
tasks (such as tools and computer software) and also technology to
help team members coordinate their work. Having appropriate
technology is also essential for the success of virtual teams. In any
case, team members should have input into the adoption or
development of communication technologies.

(ii) Selection of Team Members

Selection of members is extremely important in ensuring success of a
team. Effective teams normally consist of individuals with both
technical skills as well as interpersonal skills. Technical skills enable
individuals to do their work effectively whilst interpersonal skills
enable him/her to maintain good relations and encourage
cooperation among team members.

Managers should ensure that those selected as team members could

play their respective role(s) in the team. If those selected do not
possess the team spirit, they need to be trained to work in a team so
they can contribute positively to the team.

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(iii) Training
There are many forms of training that can be given to team members in
order to enhance the spirit of teamwork. Training specialists conduct
exercises that allow employees to experience the satisfaction provided
by teamwork. This typically comes in the form of workshops that assist
employees to improve their skills on problem solving, communication,
negotiation, conflict-management and mentoring.

(iv) Rewards
If people are working together effectively as a team, they must be
rewarded as a team. The reward system needs to be reworked to
encourage cooperative efforts rather than competitive ones.
Promotions, pay rises and other forms of recognition should be given
to individuals depending on how effective they are as a team player.
This will further encourage cooperation among team members and
improve cohesiveness towards team efficacy. Thus, it is important
that the reward system for teams have multiple components, some of
which reflect team performance. One such reward system is a profit
sharing plan in which associates receive bonuses based on the profits
generated by their team. Furthermore, if the teamwork requires cross-
functional work and knowledge, team members should receive skill-
based or knowledge-based pay. Such pay is determined by what skills
and knowledge an associate acquires rather than by how he/she
performs on specific tasks.

(iv) Leader and Building Trust

The manager and team leader have a strong influence over the sense
of trust among team members. Therefore, these individuals have to
nurture a sense of trust between them, the team and among team
members. A strong sense of trust will encourage cooperation and the
spirit of teamwork, which will ultimately ensure the success of the
team. According to Palmer, Dunford and Akin (2009), besides
building trust among team members, team leaders may need to fulfill
few important roles:
The first role needs a team leader to act as a team liaison. In this
context, the leader is required to establish network with
information sources both inside and outside the team. Outside
sources include clients, customers, suppliers and higher level
management. In the liaison role, a team leader also acts as a
representative of the team and watches out for the teams

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Another leader role involves direction setting. Based on external

information and personal vision, the leader needs to develop a
direction for the teams action. This means that the leader must
develop short-term action strategies based on the long-term
organisational strategies developed by the top management
The team leader must serve as the teams operational
coordination. This role represents the management of the teams
work and processes. The major responsibilities of this role are to
recognise each members contribution and decide the best way
to integrate the various team members contributions; and to
monitor team performance and functioning.


What are the factors that managers should consider during the process
of training individuals to become team players?

6.2.8 Contemporary Issues on Teams

Let us now look at the contemporary issues on teams (see Figure 6.13).

Figure 6.13: The issues discussed in contemporary issues on teams

The explanations of the contemporary issues on teams are as follows:

(a) Teams and Total Quality Management (TQM)

One of the major feature of TQM is a team. Without teamwork, many TQM
processes and techniques cannot be applied in the organisation.

TQM can be achieved if the level of members involvement in an

organisation improves the organisational processes. All processes and
techniques in TQM require a high level of csommunication and contact,

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response, adaptation and coordination, and sequencing. Only a work

environment that has superior teams can achieve this. Teams are the
natural vehicles for employees to share ideas and implement improvements.
So a high performing team will facilitate TQM in certain processes within
the organisation.

(b) Teams and Diversity of Employees

Whilst diversity in employees refers to a wide array of perspectives on
issues, it can also spell difficulty in team uniformity and consensus.
Diversity is most useful and effective in teams whose task is problem
solving and decision making. A heterogeneous team is the best example of
a group of diverse employees where group members can put forth a wide
range of perspectives into discussion. This can increase the possibility of
the team coming up with a creative and unique solution to a problem.

In conclusion, the reluctance of team members to cooperate with one

another will affect problem solving and decision making. To ensure
effectiveness and success of teams, a deep sense of understanding should
be instilled among group members by involving them in various training

(c) Reviving Mature Groups

A successful team will not necessarily continue to perform well. There are
times when the teams performance will deteriorate. Do you still remember
the stages of group development in the previous section? The five stages of
group development are forming, storming, norming, performing and

The adjourning stage normally happens when the team has matured and is
no longer interested to come up with new and innovative ideas. This occurs
due to boredom, groupthink and their refusal to change a system, which
they have become accustomed to. Consequently, the teams internal
processes are no longer smooth and efficient, communication is affected
and conflicts arise because problems had not been resolved. This could lead
to the deterioration of team performance.

The following are several ways to revive teams:

(i) Preparing team members to face and overcome the problems of
(ii) Provide refresher training courses for team members;
(iii) Provide a higher level of training; and

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(iv) Encourage teams to treat their development as part of their on-going

learning process.


1. Explain the role(s) of a team in TQM.

2. Teams can bring about conflict that could be negative in nature.

In this instance, should the management continue to advocate

3. How can the management revive a lethargic team?


In this subtopic we will look at the process of decision making and the factors
that influence the decision making-process, which are individual differences,
organisational barriers and cultural differences. Group decision making is said to
produce better results as compared to individual decision making. The last part
of this topic deals with group decision making.

6.3.1 Individual Decision Making

There are a few models on individual decision making. We will discuss three of
these models, which are:
(a) The rational decision-making process;
(b) Bounded rationality; and
(c) Intuition.

The explanations of these three models are as follows:

(a) The Rational Decision-Making Process

According to Gordon (2001), there are six steps involved in the process of
rational decision making such as analysing the situation, setting objectives,
finding alternatives, evaluating alternatives, deciding on the best alternative
and evaluating results (refer Figure 6.14).

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Figure 6.14: Six Stages in the rational decision-making process

Source: Gordon (2001)

(i) Analysing the Situation

As a decision maker, you have to determine the main elements in a
decision-making situation. You need to identify the problems to be
solved or decisions to be made, the individuals or groups involved, and
the legislative, geographical and demographic barriers affected. You
might have to consider the available resources needed in the decision-
making process.

(ii) Setting Objectives

Next, you need to identify goals and objectives. Objectives must be
able to be monitored and measured, for example, to reduce the rate of
absenteeism by 50% for the year 2010. In this instance, you need to be
skilled at setting goals, i.e. the ability to link the percentage of job
satisfaction with the rate of absenteeism or turnover. However,
attitude, involvement, commitment and job satisfaction are difficult to

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(iii) Finding Alternatives

In this stage, you are required to list all the alternative solutions to
your problem. Primarily, you should focus on generating ideas whilst
refraining from assessing the said alternatives or ideas. A common
error made by decision makers is to rush into the next stage, which is
assessing alternatives prior to generating sufficient ideas.

(iv) Evaluating Alternatives

Now you need to critically analyse or evaluate each alternative listed
from the previous stage. Your evaluation should include an analysis
of strengths and weaknesses of each alternative.

(v) Deciding on the Best Alternative

In this stage, a decision maker should decide the best alternative and
commit to the decision they chose.

(vi) Evaluating Results

A decision maker should evaluate the situation, modify the objectives
and ensure there are enough alternatives to be assessed. Figure 6.15
shows the assumptions of the stages in the rational decision-making

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Figure 6.15: The assumptions of the stages in the rational decision-making model

(b) Bounded Rationality

Herbert Simon, a Nobel Prize laureate, introduced this model in view of his
criticisms towards the rational decision-making model.

The bounded rationality model takes into account various factors prior to
making a decision. These factors are time constraints, need for gathering of
detailed information, and limited abilities in processing the gathered
information. It also takes into account the difficulties of making a decision
in view of the various rapid and sudden changes currently taking place in
the business world.

In the bounded rationality model, individuals make decisions by

developing simplistic models that take into consideration several important
factors only whilst putting aside the total complexity of the problem. For
example, in choosing a university for further studies, do you look at
various aspects of strengths and weaknesses of each university or do you

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evaluate several important factors only, i.e. courses offered, fees charged,
and hostel facilities? In this instance, you might not consider factors such as
the number of canteens available, variety of foods and permission to use
private vehicles as important factors to be considered in your decision
making process.

When facing complex problems, most of us will reduce it to a level that can
be easily understood. In most instances, we will choose a solution that is
quite satisfactory and acceptable or sufficient but not necessarily the
optimal or best solution.

According to Simon, there are three steps taken by managers and other
decision makers when making bounded decisions, such as:

(i) Scanning the surroundings to ascertain the situation, which will assist
in decision making;
(ii) Design possible solutions to problems through development; and
(ii) Analyse possible actions and choose acceptable alternatives to
problems despite the fact that these alternatives are not necessarily
the best.

(c) Intuition
Contrary to both the models mentioned earlier, there are times when
decisions are made based on intuition that omits the need to review details
of problems and short-listing alternative solutions.

According to Agor as cited in Robbins (2008), there are eight factors that
induce decision making based on intuition. These factors are shown in
Figure 6.16.

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Figure 6.16: Factors that induce decisions based on intuition


Using a mind map, compare the three models of individual decision


6.3.2 Individual Differences: Decision-making Styles

Humans have different styles of decision making. For instance, when you and
your partner have to make a decision based on the same situation, your partner
might take a longer time than you to come up with a decision and the decision
taken might not necessarily be better than yours.

According to Rowe and Boulgarideas as cited by Robbins (2008), humans differ

in two dimensions, which are, the way of thinking and tolerance for ambiguity.
The way we think may either be logical and rational, i.e. we process information
in a singular manner. On the contrary, people who are more creative and who
tend to use more of their intuition will view things holistically whilst making

In addition, your faster speed in coming up with decisions as compared to your

partner may be due to your low tolerance for ambiguity. You require little
information to make decisions in comparison to your partner who needs detailed
information prior to making decisions.

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When these two dimensions (way of thinking and tolerance for ambiguity) are
graphically represented, it forms four ways of decision making, i.e. directive,
analytical, conceptual and behavioural. Refer to Figure 6.17 to view the model of
decision-making styles.

Figure 6.17: Model of decision-making styles

Source: Rowe & Boulgarideas (1992) as cited by Robbins (2008)

The explanation for the model of decision-making styles is as follows:

(a) The directive style in decision making is utilised by individuals who have
low tolerance for ambiguity and use logical and rational thinking. They
require minimal information and assess only a few alternatives prior to
making quick decisions, which are focused on short-term results.

(b) The analytical style is mainly utilised by individuals who have a high
tolerance towards ambiguity (as compared to those who use the directive
style). These individuals need more information, consider more alternatives
and are very cautious whilst making decisions.

(c) Similarly, individuals who adopt the conceptual style have a high level of
tolerance for ambiguity. They are more open in terms of their approach
whilst considering more alternatives before making decisions. In addition
to having the ability to produce creative solutions to problems, their
solutions are also long term in nature.

(d) Managers who subscribe to the behavioural style are those who are able to
cohesively work with others. They are open to suggestions whilst
constantly communicating to solve problems. They require the acceptance
of others and prefer to avoid conflicts.

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In your own words, briefly explain the four styles of individual

decision making.

6.3.3 Individual Barriers

We will now discuss individual barriers. Individuals often make mistakes in
decision making. Although carelessness, sloppiness, fatigue and task overload
can be contributing factors, some mistakes are caused by simple problems such
as cognitive biases. Such biases represent mental shortcuts. These shortcuts can
be harmless and save time but they often cause problems. According to Collela
(2008), the types of cognitive biases include:

(a) Confirmation Bias

This type of bias leads decision makers to seek information that confirms
beliefs and ideas they formed early in the decision process. In this context,
individuals subconsciously seek only information that supports their early
thinking. Failing to look for disconfirming information is particularly likely
if a decision maker is revisiting a decision that has already been made.

(b) Ease of Recall Bias

In the context of this bias, a decision maker gathers information from his own
memory and relies on information that he can easily recall. Unfortunately,
easily recalled information may be misleading or incomplete. Vivid and
recent information tends to be easily recalled but may not be indicative of the
overall situation.

(c) Anchoring Bias

This type of bias leads decision makers to place too much emphasis on the
first piece of information they encounter about a situation. This initial
information then has undue influence on ideas, evaluations and
conclusions. Even when decision makers acquire a wide range of additional
information, the initial information can still have too much influence.

6.3.4 Organisational Barriers

The organisation itself is a barrier to decision makers. These barriers are
performance evaluation, reward systems, formal rules, time constraints and
previous decisions.

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(a) Performance Evaluation

In making decisions, managers are influenced by numerous criteria
determined in the performance appraisal. For example, one of the criteria in
a lecturers performance appraisal is the educational performance or results
of his/her students. If the percentage of failure is high, e.g. exceeding 5%,
the lecturers competence will be questioned. Therefore, a lecturer will
ensure that the failure rate of his/her students does not exceed the pre-
determined percentage to avoid a negative performance appraisal.

Such a performance appraisal will influence a lecturers decision making.

The same applies to managers who prevent negative information
pertaining to their department from reaching the top levels. In this instance,
managers who assume that by not providing the top levels with accurate
information (negative ones included), the top levels will conclude that he
and his team (department) are doing well. However, this might not
necessarily be the case.

(b) Reward System

An organisations reward system can also influence the process of decision
making. Organisations that reward (via increments and promotions)
managers who are not involved in any controversy, have low profiles and
are good team players will inevitably produce managers who are afraid to
take risks and pass any controversial decisions to the committee to decide.

(c) Formal Rules

An organisations rules act as factors that obstruct and limit creativity and
the choices available to the decision maker. Through regulations, policies
and procedures, an organisation has set the degree of obedience and
freedom of its employees.

(d) Time Constraints

Sometimes a decision has to be made within a determined period of time.
This pressure tends to adversely affect the decision makers abilities to
gather sufficient information and to eventually make proper and beneficial

(e) Past Decisions

Decisions that have been made in the past also influence future decisions.
Bonuses given in previous years will affect the decision on the percentage
of bonus to be given in the current year, despite the poor financial standing
of the company.

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In addition to the organisational barriers discussed in this section, list

other organisation barriers you might know. Discuss with your

6.3.5 Cultural differences

The rational decision-making model does not take into account the cultural
differences inherent in Europeans, South Americans, Americans, Canadians and
Asians when it comes to the different styles of decision making. Therefore, we
must take into consideration the cultural factor.

In some places and cultures, decision making normally takes a longer time
compared to others, whilst some require collective decisions. Other cultures
allow only individual decision making.


Now, we will look at group decision making. According to William (2000), a
study reported in Fortune magazine found that 91 percent of companies in the
USA used groups to make decisions. Most employees are told that in solving any
problem, none of us here is as smart as all of us.

If done in a proper manner, group problem solving is able to produce decisions

with better results as compared to individual decision making. In fact, most
surveys show that groups are better than individuals in carrying out complex

6.4.1 Advantages of Group Decision Making

In defining problems and generating alternative solutions in the process of
decision making, groups tend to perform better than individuals. This statement
is supported by several reasons (refer to Table 6.6).

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Table 6.6: Advantages of Group Decision Making

Advantages Explanation

Better problem Groups are commonly made up of members who have a

statements variety of knowledge, skills, abilities and experiences, which
enable problems that could be viewed from various
perspectives. This opens up opportunities for more problem
solving approaches and alternatives. Research has shown that
generating more alternative solutions can improve the quality
of decisions that are made.

Groups generate more In groups, information and knowledge can be generated from
detailed and complete various perspectives, as opposed to a singular or limited
information and perspective of an individual. With more detailed and complete
knowledge information and knowledge, better decisions can be made
whilst reducing the percentage of making inaccurate decisions.

Group involvement As all the individuals in groups are involved in the decision
fosters commitment in making process, they will be committed to the decisions made
achieving goals by the group. In addition, there is also a tendency that they
will feel responsible towards the decisions that are made.
Therefore, members of the group will strive hard to implement
all the decisions made to achieve their goals.

A shared decision is also able to increase the members

acceptance of the decision and prevent misunderstandings or

6.4.2 Disadvantages of Group Decision Making

There are several disadvantages of group decision making as shown in Table 6.7.

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Table 6.7: Disadvantages of Group Decision Making

Disadvantages Explanation

Time In view of the fact that group decisions involve many

Constraints individuals and require the discussion of various
perspectives, decisions take a longer time to be made as
compared to those that are made individually.

Dominant Dominant individuals in the group may influence decisions

Behaviour made by a group of individuals. Out of fear or respect,
members might agree with a particular decision made by
these dominant individuals and this might result in the
quality of the decision being compromised.

Groupthink Group decision making is susceptible to groupthink.

Groupthink is the pressure to conform to what seems to be
the dominant view of the group whilst dissenting views are

This pressure prevents the group from openly and critically

evaluating all alternatives. As a result, the qualities of
decisions are compromised. Pressures exist in situations

(i) Members have varying perspectives;

(ii) The group leader puts forward sound arguments for a
(iii) No set procedure for interpreting problems and
evaluating alternatives; and
(iv) All members with similar background and experiences.

Although group decision making has several weaknesses, this

should not deter a manager from exercising group decision
making since proper management can overcome these


Why does groupthink occur and what is its effect on the quality of
decisions that are made?

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6.4.3 Techniques of Group Decision Making

There are several techniques or approaches that we can use to reach a decision in
a group (refer to Figure 6.18).

Figure 6.18: The techniques of group decision making

Details of these techniques are:

(a) Brainstorming
This technique encourages the generation of ideas from each group
member about the topic of discussion. It is a suitable technique to be used
when new ideas are needed and also to generate as many ideas as possible
for a topic of discussion. The ideal number of group members for optimum
effectiveness is between five to seven people.

(b) The Nominal Group Technique

This technique is used when a limited number of opinions are needed and
unanimous decisions need to be achieved in a short period of time. In this
technique, a panel is set up to solve a particular problem with members in
the group trying to identify alternative solutions individually and once this
is done, individuals will present their ideas to the group.

Subsequently, through the exchange of ideas among group members, each

proposed alternative will be evaluated from all angles, which includes
strengths, weaknesses, opportunities and threats. Members will then vote
to choose the best solution with confidentiality assured for every vote that
is made. This encourages members to use their creativity in selecting the
best alternative in a private manner.

(c) The Delphi Technique

This is an inquiry approach to obtain members opinions in the decision
making process. This technique is more complex and time consuming
compared to the two techniques discussed earlier.

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Every member is quizzed through several rounds of investigation to

produce information profiles, ideas and/or solutions to a clearly defined
problem. Contrary to the two earlier techniques, the Delphi Technique does
not require members to meet up whilst their identities are kept secret.
Therefore, this technique is very effective for gaining feedback on issues,
which are sensitive and have very high risks.

There are several weaknesses to this technique, which include a change in

the panel of membership, especially when the decision-making process
takes a substantial amount of time; secrecy on the identities of panel
members which may affect accountability and responsibility among
members; and the possibility of panel members making inaccurate
decisions due to unclear questions.

(d) Electronic Brainstorming

This technique requires all members of a group to be connected via a
computer since its brainstorming technique uses information technology to
put forth problem-solving ideas.

This is another technique that does not require face-to-face meetings and it
is said to be able to overcome problems faced by other brainstorming
techniques. Through this technique, members can type their ideas and
these ideas are instantaneously displayed to other members of the group.
This technique is fast in its approach since conversations are reduced,
discussions do not veer out of topic and participants can simultaneously
put forth ideas without any barriers. Most meetings conducted now and in
the future are using techniques that involve the application of information


Imagine that you and your group are given a problem to be solved.
What are the techniques that you will use? Why?

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Lastly, we will look into the value of individual versus group decision making.
Under the proper conditions, group decision-making should increase the number
of ideas generated and improve the evaluation of alternatives. Such outcomes are
desirable because they generally produce better decisions. However, our earlier
discussion on group decision making suggests that these results are not
guaranteed. Other factors that need to be considered include the time needed to
reach the decision, the costs of making the decision, the nature of the problem,
the commitment and the satisfaction of the participants affected by the decision.
All of these points are described in Table 6.8.

Table 6.8: Advantages and Disadvantages of

Individual and Group Decision-Making

Advantages Disadvantages

Groups can accumulate more knowledge Groups take more time to reach decisions
and facts. Thus, generating more and than individuals.
better alternatives than individuals.

Groups often display superior judgment Group social interactions may lead to
when evaluating alternatives, especially premature compromise and failure to
for complex problems. fully consider all alternatives.

Group involvement in decisions leads to Groups are often dominated by one or

a higher level of acceptance and two individuals who may reduce
satisfaction from the decisions. acceptance, satisfaction and quality.

Group decision-making can result in Managers may rely too much on group
growth for members of the group. decisions, leading to loss of their own
decision and implementation skills.

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Choose the correct answer

1. Which of the sentences below explains the disadvantage of group

decision making?
A. Groups can accumulate more knowledge and facts.
B. Groups are often dominated by one or two decision
C. Group decision making can result in growth for members of
the group.
D. Group involvement in decisions leads to a higher level of
acceptance and satisfaction from the decisions.

2. The techniques below are related to addressing the problems that

may arise in group decision making EXCEPT:
A. Brainstorming
B. Delphi technique
C. Dialectical inquiry
D. Management by objective

3. Following are types of teams EXCEPT:

A. Virtual teams
B. Functional teams
C. Managerial teams
D. Self-managing teams

4. Which of the statement below is false regarding teams?

A. Personality and the size of the team do not influence the
teams effectiveness.
B. The processes employed and experienced by the team also
influence team performance.
C. Teams experience four developmental stages: forming,
storming, norming and performing.
D. Team effectiveness is measured in terms of the teams
productivity and also in terms of team leasing and cognition,
and team members feelings about the team.

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5. Below are the factors that can influence team effectiveness EXCEPT:
A. Team members personalities.
B. Team learning and cognition.
C. Team processes include team cohesion, social facilitation and
social loafing.
D. None of the above.

An understanding of the foundation of group behaviour is important since

each and every individual is a member of various groups within an

There are two types of groups in an organisation formal groups are formed
to carry out certain tasks in accordance with the requirements determined by
the management and informal groups are formed without the existence of a
formal figure of authority.

Understanding the meaning and overall concept of a group development

model as well as group behaviour model will enable a manager to effectively
handle conflicts in groups.

Teams are the foundation for a progressive management in the future and are
useful in performing complex tasks.

There are some differences between work groups and work teams.

There are six steps involved in the process of rational decision making
analysing the situation, setting objectives, finding alternatives, evaluating
alternatives, deciding on the best alternative and evaluating results.

In an organisation, decisions are made either by individuals or groups.

Decision making in organisations should not be taken lightly since good

decisions will have positive effects on an organisation.

Group decision making is said to be more effective as compared to decisions

that are made individually.

Although group decision making has its weaknesses, these can be overcome
through good management.

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Cohesiveness Rational decision-making

Cross-functional teams Self-managed terms
Group behaviour model Work groups
Individual and group decision-making Work teams

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Topic Leadership

By the end of this topic, you should be able to:
1. Explain the relationship between a leader and the power of a leader;
2. Contrast between leadership and management;
3. Assess trait and behavioural theories;
4. Discuss two approaches in contingency theories; and
5. Analyse leadership patterns in various leadership theories and

Have you been given the task to lead a group, either formally or informally?
Have you been responsible in leading a formal or informal organisation? If you
have experienced either one or both of the said responsibilities, consider the
three questions below and respond to them accordingly.

Firstly, how were you appointed a leader for that group or organisation? Did you
volunteer to lead or did the majority of the members choose you to lead them or
were you appointed through the organisations formal processes, i.e. a
promotion that put you as head of a unit, a division, or even the entire

Secondly, how did you lead your subordinates? Did you exercise control over
their behaviours and actions by enforcing rules or did you utilise a diplomatic
approach? Was it a case of alternating between the two, depending on the

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Thirdly, are you the sort who aspires to be a leader, or a faithful follower who is
committed to the leadership?

In this topic our discussion will focus on these three questions, which are related
to leadership. Some of the aspects that will be emphasised are power of leaders;
the differences between leaders and managers; traits, behaviours and
contingencies of leaders; and neo-charismatic theories.


Let us begin with the definition of leadership. Leadership is defined as an
individuals effort to influence others to share and accept his/her views. If
his/her effort is successful, his/her subordinates will comply with his/her
instructions and directives. In organisations, the aims pursued by the leader
would be consistent with the organisations aims. Those are the very goals that
the leader would convince other members of the organisation to share.

Two important concepts that emerge from the above are: influencing followers
and followers compliance. These two are unable to exist without the following
element: power. What do you understand of power? Power is an element that
exists within a person that enables him to influence and control others, including
the ability to make decisions. Whenever leadership is discussed, the concepts of
leader and power are inseparable.

How does one obtain power? To understand this, we need to look at the sources
or bases of power. Generally, social scientists have forwarded several sources or
bases of power. However, we will focus on the five most commonly mentioned
sources or bases of power. Figure 7.1 shows the source of power classification.

Figure 7.1: Sources of power classification

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1. What is the definition of leadership?

2. What is the relationship between leadership and the organisation?

7.1.1 Individuals Personal Characteristics

There are times when a person obtains power in an organisation purely by
accident. In situations such as these, the personal characteristics of a person and
the way he/she conducts himself/herself results in the person being elected as a
leader. This individual may be a respectable person of high integrity,
charismatic, knowledgeable and experienced - qualities that command the
respect or liking that people have for him/her. Accordingly, it is natural for
people to obey him/her and remain under his/her leadership. This type of
power is termed as referent power.

7.1.2 Individuals Expertise

A persons expertise in a certain field also gives him/her access to power.
However, the power extended in this case is limited to the particular aspect of
his/her expertise. For example, a heart specialist is given the power to lead the
cardiology unit that treats problems related to the heart, in view of the fact that
the hospital acknowledges the specialists expertise in that area. The subordinates
of the specialist will not question him/her and will certainly obey all of his/her
instructions on work-related issues. This type of power is termed expert power.

7.1.3 Formal Position (Post/Role)

A person who is given a particular position within the hierarchy of an
organisation automatically wields legitimate power. For instance, the head or
manager of a marketing unit has the power to lead all the people in the unit. In
this context, the managers power is limited within the bounds of the unit or
marketing function only. He/she is unable to lead or command those outside the
marketing facility. This kind of power is called legitimate power.

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7.1.4 Reward
Power can also be obtained through reward. In this instance, in an effort to
control and manage subordinates, a leader can offer rewards in the form of a pay
raise, bonuses, promotions, etc. A manager too has the power to approve specific
rewards to selected employees who have demonstrated their compliance with
his/her directives and who have performed well. A manager or leader who has
the power of reward can influence his/her employees to comply with all of his/
her directives.

7.1.5 Coercion
Coercion is another source of power. To ensure employees observe all directives,
the coercion approach can be employed. Managers are given the power to coerce
employees into performing tasks related to their organisational functions. Failure
to comply with the said coercion will result in punishment. This power is
referred to as punitive power.


1. If you wish to be a leader, what means would you employ to

influence your potential followers?

2. Explain the relationship between a leader and power.

3. What is the difference between the power of referent and the

power of expertise?


Now that we know the definition of leadership and the five sources of power, the
next part to look at is the concept of leaders and managers. It has already been
established that managers play an important role in driving an organisation
towards meeting its goals. Good managers have a good balance technical,
human, conceptual and motivational skills.

Today, the function of a manager includes planning, organisation, leading and

controlling. The functions can be effectively and efficiently fulfilled when a
manager is able to solicit the cooperation and involvement of all of his/her
employees. In this context, is a manager also a leader?

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Before responding to the above question, it is best that we compare and contrast
the concepts of a manager and a leader:
(a) Leaders are people who can conceive ideas, ensuring the continuity of their
organisation and meeting all its goals. A leader strives to influence the
people under him/her to accept and implement the ideas that he/she
(b) A manager, in view of his/her authoritative position within an organisation,
instructs subordinates to carry out tasks in order to meet organisational

On this basis, we can no longer assume that all managers are leaders. A manager,
due to his/her position in the top rank of an organisation can deliberately or
accidentally become a leader. On the contrary, there are many cases in which a
leader also functions as a manager.


Would you agree if we said that a manager does not necessarily make a
leader? If yes, why?


Now, we will discuss theories that are related to leadership. The argument that
has been put forward is further related to the question of whether leadership is
inherited or obtained through learning and formal exposure. The theories
discussed will clarify this question. Refer to Figure 7.2.

Figure 7.2: Theories on leaders

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7.3.1 Trait Theory

This theory relates the characteristics of a person with his/her ability to lead. A
close study of an individuals personality traits will determine whether he/she
makes an effective leader or otherwise.

Figure 7.3 shows the characteristics that separate a leader from a follower and
which can possibly account towards effective leadership.

Figure 7.3: The characteristics of an effective leadership

This theory enables us to predict the efficacy of a leader by identifying certain

traits within him/her. If we subscribe to this theory, then we will automatically
agree that leadership characteristics in a person are inborn. In other words, some
people are born leaders.

However, do you fully agree with this theory? If you do not, then you share the
views of social scientists that have put forward their arguments on several
weaknesses of this theory. Schneider as cited by Robbins (2008) argues that there
is not one single universal trait that can predict leadership in all situations. At
most, this theory predicts leadership in certain situations only.

Robbins (2008) forwarded a statement by Michael, Barrick and Mount on two

situations: strong and weak. A strong situation refers to the existence of a set of
behavioural norms, a strong incentive for various forms of specific behaviour
and clear expectations on the kinds of behaviour that will be rewarded or
punished. A strong situation does not give a leader the opportunity to express
his natural inclinations. The inability to predict leadership traits is more
pronounced in organisations that maintain a high level of formality accompanied
by a strong culture.

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In addition, the cause and effect relationship of the trait theory is unclear. For
instance, Robbins argued whether a leader naturally possesses self-confidence or
self-confidence grows in a person as a result of successes in his/her leadership.

Finally, Lord et al. and Smith and Foti as cited by Robbins (2008) also added that
while traits can predict the personal characteristics of a leader, these traits do not
differentiate between an effective and non-effective leader. Consequently, a
leader need not necessarily be successful even though he possesses the traits
mentioned above.

7.3.2 Behaviour Theory

Behaviour theory studies the behaviours of effective leaders, emphasising the
fact that there are certain types of actions that contribute to successful leadership.
To nurture effective leaders in an organisation, the management should select
those on the basis of the appropriate actions that they undertake whilst leading
their respective followers.

The behaviour theory advocated that effective leaders can be groomed with the
right kind of exposure by practicing the right types of behaviours.

What do the right types of behaviour mean? Generally, there are two types of
behaviours (refer to Figure 7.4).

Figure 7.4: Types of behaviours

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There have been a few studies specifically on behaviour and its relationship to
leadership. Among them are:

(a) The Ohio State Studies (OSU)

Studies conducted at The Ohio State University divided the behaviours of a
leader into two dimensions: consideration and initiating structure.

In order to understand these two dimensions you need to re-look the two
forms of behaviour: consideration and work relations. Consideration is a
behaviour that has to do with being considerate. This study identified the
behaviours of certain leaders and how the said behaviours affect the
relationship between leader and subordinates. These include maintaining a
two-way communication, showing appreciation for the ideas that were put
forward by the employees, not being prejudiced whilst taking an interest in
employee welfare and having empathy towards them.

What about the initiating structure dimension? This initiating structure,

which shares the same characteristics with Task Relationships, is job
oriented. In this instance, a leader tries to structure and provide detail
explanation about the job and the role played by employees in
accomplishing their respective tasks to ensure that organisational goals are

(b) The University of Michigan Studies (UM)

Leadership studies at UM share similar objectives with those at OSU. The
behavioural consideration and job relationship are expressed as employee-
oriented and production-oriented. In this study, leaders who were
employee oriented tended to emphasise on interpersonal relations by
taking a personal interest in the needs and welfare of their employees.

On the contrary, leaders who are production-oriented were more

concerned with the completion of tasks and employees quality of work.

(c) The Managerial Grid

Blake and Mouton as cited by Robbins (2008) developed a graphic
representation of a two-dimensional view on the styles of leadership. It is
similar to the dimensions put forward by OSU and UM. Figure 7.5 shows
Blake and Moutons managerial grid.

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Figure 7.5: Blake and Moutons managerial grid

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

Based on Figure 7.5, two dimensions are represented in this grid: concern for
employees (people) and concern for production. These are placed along two axes
with each axis being made up of nine positions, beginning from 1 to 9, which is
the highest point. In total, there are 81 positions representing the various
leadership styles practiced by leaders.

For instance, a leader who is at position (1,9) is extremely concerned about

his/her employees welfare at the expense of their respective tasks. A leader who
falls into position (9,1) overly emphasises the task and rates very low pertaining
to his/her concern for employees. Leaders who are at (1,1) are neither concerned
with tasks nor employees whilst a leader who is at (9,9) places equal emphasis on
employees and tasks. What about leaders who are at (5,5)? They place a balanced
and moderate emphasis on tasks and employees.

What is the significance of these studies to our understanding of effective

leadership? Some people are more inclined to say that leaders should emphasise
on tasks and the quality and quantity of tasks performed by an employee over
the employees welfare.

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However, there are others who feel that leaders should ensure that an employees
welfare should take precedence over work matters. In relation to this, the OSU
study found that if the initiating structure is emphasised, there is a possibility of
negative long-term effects, i.e. employee dissatisfaction, absenteeism and/or

In the study conducted by UM, it was found that leaders who were employee-
oriented experienced higher employee productivity and job satisfaction.

However, the importance of job relations behaviour should not be overlooked.

There are situations that require concern for production to be widely enforced in
an organisation, i.e. when a company is in its infancy stage or when a company is
experiencing problems. In companies such as these, the focus needs to be on
productivity to ensure success and survival, respectively.

On the contrary, there are organisations, e.g. the military or the emergency unit
of a hospital that require leaders who are production-oriented due precisely to
the urgency of the tasks involved. It is absolutely imperative that the tasks
related to units such as these are performed well with the job taking precedence
over the employee.


1. As a leader, which would be your emphasis? Production or


2. Briefly explain why it is said that positive personal characteristics

do not necessarily lead to effective leadership.

7.3.3 Contingency Theories

Until now, our discussion has centred on the characteristics and behaviour of
leaders and their influence on effective leadership. However, the theories that
have been put forward so far lack the ability to account for the various situations
and contexts that affect effective leadership.

Subsequently, contingency theories emerged attempting to fill this void by

looking at the leaders success as situation related. Among the contingency
theories that we will review are the Fiedler Model and Hersey and Blanchards
Situational Theory.

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(a) Fiedler Model

This model, developed by Fred Fiedler, highlights the direct relationship
between leaders and situations. It proposes that an effective group
performance depends on the proper match between the style of a leader
and situation. In other words, according to Fiedler, the success of a leader is
dependent on his/her leadership style.

How does Fiedler assess leadership style? He divided the process into two

(i) Collection of Data on Least Preferred Co-worker (LPC)

At this stage, data is collected utilising a questionnaire that is given
out to selected executives. The executives were asked to list all their
co-workers and to rate their co-workers based on how much they
enjoyed/disliked working with the listed co-workers. The rating is
done on a list of sixteen sets of contrasting adjectives (pleasant-
unpleasant, friendly-unfriendly, close-distant, accepting-rejecting,
etc.) placed on a scale of eight, beginning at one which represents the
most negative adjective and ending with eight, which is the most

It was found that there were executives who indicated positive on a

high LPC (describing the Least Preferred Co-worker in relatively
positive terms) while there were those who indicated negative on a
high LPC (describing the Least Preferred Co-worker in relatively
negative terms). In this instance, Fiedler said that executives who
ranked the LPC in relatively positive terms would make leaders who
are interested in good personal relations with their co-workers. On
the other hand, those who gave negative ratings will become leaders
concerned with productivity.

(ii) Matching Leaders to Situations

When the style of leadership has been determined at the initial stage,
Fiedler proceeded to match leaders to situations. According to Fiedler,
since it is extremely difficult for an individual to change his/her
leadership style, it is important to match an individuals leadership
style to wide-ranging situations in order to find an equal match.

Fiedler identified three contingency dimensions that define key

situational factors that determine leadership effectiveness (refer to
Table 7.1).

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Table 7.1: Situational Factors of Three Contingency Dimensions

Dimension Situational Factors

Leader-member This refers to the degree to which members have confidence, trust
Relations and respect in their leader.

Task Structure This refers to the degree which job assignments are formalised and
properly structured. This means that matters pertaining to a
particular task like goals, tools and quality measurement are
clearly and explicitly stated, i.e. expenses, accounting, tasks for the
operations/production division, etc. On the contrary, there are
tasks that are usually not made explicit, i.e. strategic planning,
research, human resource development, etc.

Position Power This refers to the degree of influence a leader has over power
variables such as hiring, firing, discipline, promotions and salary

What did Fiedler do to the three dimensions he identified? He combined

the three dimensions to formulate situations that are considered favourable
or unfavourable to leaders. Favourable situations are those where all three
dimensions are at high levels while unfavourable situations were
characterised by poor leader-member relations, low levels of task structure
and low position power.

Consider how each of the two situations above are related to high LPC
leaders (task-oriented) and low LPC leaders (relationship-oriented).
According to Fiedler, leaders with high LPC (task-oriented) tend to perform
better in situations that were favourable to them and in situations that were
unfavourable. Low LPC leaders (relationship-oriented) perform better in
moderately favourable situations.

Figure 7.6 depicts eight different situations that leaders may find
themselves in. The diagram shows that low LPC leaders work effectively in
situations within categories I-IV while high LPC leaders perform better in
moderate situations within categories IV-VI.

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Figure 7.6: Fiedler s contingency model

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

Can you give reasons why high LPC leaders are effective in favorable
situations, i.e. good leader-member relations, high task structure and strong
power position?

The leader is successful because he/she has no problems to lead members

who place great trust and confidence in him/her whilst respecting him. In
addition, an explicit task structure enables employees to understand the
task at hand, making it easier for a leader to ensure that the task is properly

Finally, equipped with certain powers (strong position power), such as the
power to take disciplinary action, determining salary increment and/or
promotion, forces employees to obey the leader.

What about unfavourable situations, which are characterised by poor

leader-member relations, low task structure and poor position power? At a
glance, we would be inclined to think that the three dimensions do not help
the leader in influencing his/her members. Therefore, how could leaders
with low LPC be effective? This is so if we perceive the situation from a low
task structure situation.
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In this instance, if a leaders leadership style were one that is task oriented,
he/she would attempt to provide clear instructions and explanations for a
task that has been vague and unclear. In this way, employees would
understand why a particular task is assigned to them and how to go about
getting it done. This will turn them into an effective work group.

What are the implications of Fiedlers model on leadership in an

organisation? This model is essentially an attempt to match leaders to
situations because the effectiveness of a leader is dependent on situations.
Therefore, to ensure continuous levels of optimum efficiency of leaders, the
management has to place them in situations they are best suited in, taking
into account their respective leadership styles.

An alternative approach that can be taken by the management is to adapt a

particular situation to suit the style of the said leader. This approach would
only change the situation but not the position of the leader.

While Fiedlers model has helped us to understand suitability and

effectiveness in various situations, it has some weaknesses.

Among the shortcomings of the model are the LPC scores only measure
two extreme situations: high work motivation and high relationship
motivation whilst ignoring moderate scores. In addition, the model is based
on the questionable assumption that LPC scores are stable. Finally, the
contingency dimensions are complex and difficult for practitioners to
assess. It is often difficult in practice to determine how good leader-
member relations are since it is a subjective entity that invites varying
interpretations from various individuals in an organisation.

(b) Hershey and Blanchards Situational Theory

Similar to the Fiedler Model, the model developed by Paul Hershey and
Kenneth Blanchard looks at leadership styles in terms of task and
relationship orientations. The difference between these two models is that
the latter takes the perspective of members or followers. In this instance,
this model focuses on the followers and the leadership style is matched to
the followers willingness to meet the wishes or instructions of the leader.
How does this model explain a leaders success? Here, we need to
acknowledge that successful leadership depends on the readiness of its
followers. Readiness refers to the extent to which people have the abilities
(skills, knowledge, ability, and experience) and willingness (confidence,
courage, commitment and a high degree of motivation) to accomplish a
specific task.

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This model identifies four specific leadership styles (dependent on task and
relationship orientation): telling, selling, participating and delegating.

These dimensions (refer to Figure 7.7) are placed along the following four
types of behaviour or readiness of the employees:

(i) Unable and unwilling (ua-uw);

(ii) Unable and willing (ua-w);
(iii) Able and unwilling (a-uw); and
(iv) Able and willing (a-w).

Figure 7.7: Hershey and Blanchards situational leadership theory

Source: Adapted from Cook, C. W., & Hunsaker, P. L. (2001)

The Relationship between Effective Leadership and Member Readiness

What type of readiness enables a leader to perform effectively? Table 7.2 shows
the answers.

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Table 7.2: Relationship between Effective Leadership and Member Readiness

Type Explanation

Telling Since members are not only unwilling but also unable to perform the
(Unable and task, a leader would do well to place emphasis on the work aspect
Unwilling) and downplay aspects pertaining to relationships. In this instance,
the leader has to specifically tell members about the task and conduct
supervision throughout the duration of implementation of task.

Selling This situation requires the leader to pay extra attention to work
(Unable and aspects to make up for the members inability to accomplish a given
Willing) task. The leader has to forge close relations by selling and providing
all types of necessary support to assist members to complete the task.

Participating With those who are auw, successful leaders have to emphasise on
(Able and work aspects since members already have the skills and ability to
Unwilling) complete their task.

Delegating This is the easiest situation for leaders because neither task nor
(Able and relationship requires much attention. This is a situation where
Willing) members have no trouble receiving orders and accomplishing
assignments. On the other hand, a leaders success may be
compromised if he over emphasises task and relationship aspects on
members. Members may feel stifled or that they are not trusted and
this can adversely affect their job satisfaction. Importantly, in this
situation, leaders need to give members a bit of a freedom or delegate
them their respective tasks.

Choose a government agency or private organisation and proceed to
consider if contingency theories exist within the selected government
agency or private organisation. Provide reasons to your answer.

7.3.4 Neo-charismatic Theories

The study of leadership has developed into studying the behaviour of leaders
that exist in this complex and challenging era. The theories that study patterns of
contemporary leadership are known as Neo-charismatic Theories. Figure 7.8
shows three underlying themes of this theory.

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Figure 7.8: Three underlying themes of neo-charismatic theories

Source: Robbins (2008)

Now, what happens to the theories that were put forward prior to this, i.e. Trait
Theory and Behaviour and Contingency Theory? Are these theories no longer
applicable today? This is actually not the case because these theories form the
base for the development of neo-charismatic theories. In fact, these theories
complement each other in guiding organisations in their quest towards achieving
their respective goal(s).

This module goes on to elaborate the forms of neo-charismatic leadership, i.e.

transactional, charismatic and transformational.

(a) Transactional Leadership

Transactional leaders are task and relationship oriented, resulting in their
ability to influence employees to do as they (the leaders) wish in an effort to
achieve organisational goals.

Another feature of this leadership is the exchange process or the use of

reward and punishment to ensure members follow orders. In this context,
legitimate power, reward and coercion powers become necessary attributes
for this type of leaders. It has been said that transactional leadership only
works with followers who have a clear understanding of the organisational
structure and are currently performing specific daily and routine tasks.

(b) Charismatic Leadership

A leader is considered charismatic if he has qualities that enable him/her to
establish exceptionally good relations with his/her followers.

Anita Roddick (The Body Shop), Bill Gates (Microsoft), Sam Walton (Wal-
Mart), Martin Luther King Jr. (American social activist) and Tan Sri Lee
Lam Thye (a local social activist) are all said to have charismatic attributes.

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Charismatic attributes refer to:

(i) Leaders who provide opportunity for employees or subordinates to

develop their career;

(ii) Leaders who are open and always ready for criticisms and
constructive suggestions from followers, often acknowledging other
peoples views;

(iii) Leaders who encourage two-way communication with their followers

and often share useful information with their followers; and

(iv) Leaders who are prepared to take personal interest for the benefit of
their followers and organisations.

Table 7.3 shows the main attributes of charismatic leaders.

Table 7.3: Main Attributes of Charismatic Leaders

Attribute Characteristics

Vision and They have a vision expressed as an idealised goal that proposes
Articulation a future better than the status quo, and are able to clarify the
importance of the vision in terms that are understandable to others.

Personal Risk They are willing to take on high personal risk, incur high costs and
engage in self-sacrifice to achieve their vision/s.

Environmental They are able to make realistic assessments of the environmental

Sensitivity constraints and resources needed to bring about changes.

Sensitivity to They are perceptive of the abilities of others and responsive to their
needs of their needs and feelings.

Unconventional They engage in behaviours that are perceived as novel and contrary
Behaviour to norms.

Source: Robbins, S. P. & Judge, T. A. (2008)

(c) Transformational Leadership

It has already been mentioned that transactional leaders are only effective
in an organisation that operates under average conditions (not complex)
and are stable (as opposed to dynamic).

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For complex and dynamic organisations, transformational leadership is more

appropriate. What is transformational leadership? While all the charismatic
attributes embodied above are also available in transformational leadership,
leaders belonging in this category have a more extensive intent and
ambitions as compared to charismatic leaders. Transformational leaders are
able to inspire followers to transcend their own self-interests for the good of
the organisation. This results in followers being prepared to put in the extra
effort to achieve organisational goals.

Transformational leaders are also able to encourage their followers to

generate ideas to handle old problems with novel approaches. In addition,
according to Avolio and Bass as cited by Robbins (2008), transformational
leaders desire more than what is expected by the charismatic leader. The
transformational leader expects his/her followers to be able to question any
views, including those of the leader.

It is now clear that while transactional leaders are suitable for matters
relating to the daily management of an organisation, transformational
leaders are needed to manage complex, unstable and uncertain
environment/s. However, both types are needed to ensure the smooth
running and stability of an organisation.

In short, the four components of transformational leadership is summarised

in Table 7.4.

Table 7.4: Four Components of Transformational Leadership

Component Explanation

Inspiration Motivates followers by clarifying the meaning of work and its

accompanying challenges.

Intellectual Encourages followers to be creative and innovative.


Influential Able to influence followers to look up to him.

Individualised Gives personal attention to followers needs for personal achievement

Consideration and development.

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Elaborate on the differences between Transactional and Transformational



At this point, you have learnt several theories of leadership. Now, we will
introduce two styles of emerging leadership perspectives. These are:

(a) Moral Leadership

Leadership is not merely a set of practices with no association of right or
wrong. All leadership practices can be used for good or bad and thus have
a moral dimension. According to Zaufderer (1992), leaders choose whether
to act from selfishness and greed to diminish others or in ways that serve
and motivate others to develop their full potential as employees and as
human beings.

Moral leadership is about distinguishing right from wrong and doing right,
seeking the just, the honest, the good and the right conduct in practice. In
this context, leaders have great influence over others, and moral leadership
gives life to others and enhances the lives of others. According to Daft
(2008), immoral leadership takes away from others in order to enhance

Besides that, Kohlberg (1976) said a leaders capacity to make moral choices
is related to the individuals level of moral development. In this context, the
capacity to normal choices is related to basically three levels of moral
development as shown in Figure 7.9.

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Figure 7.9: Three levels of moral development

(b) Servant Leadership

Much of the thinking about leadership today implies that moral leadership
encourages change toward turning followers into leaders, thereby
developing theory potential rather than using a leadership position to
control people. According to Daft (2008), the ultimate expression of this
leadership approach is called servant leadership. This kind of leadership
can be described by comparing the category of leaders to other leaders. This
can be seen according to the stages shown in Figure 7.10.

Figure 7.10: Stages of leadership development

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The explanations of the four stages of leadership is summarised in Table 7.5.

Table 7.5: Four Stages of Leadership

Stage Explanation

Stage 1 - At this stage, followers are obedient subordinates who follow orders.
Authoritarian In this context, leaders set the strategy and goals as well as the
Leader methods and rewards for attaining them. Organisational stability and
efficiency are important and followers are controlled along with
machines and raw materials.

Stage 2 - At this stage, leaders have increased employee participation through

Participative employee suggestion programmes, participation groups and quality
Leader circles, etc. Teamwork has become an important part of how work is
done. However, the mindset is still paternalistic in that leaders
determine purposes and goals, make final decisions and provide
rewards. Leaders are also responsible for outcomes, and they may act
as mentors and coaches. They have given up some of their control,
but they are still responsible for the morale, emotional wellbeing and
performance of subordinates.

Stage 3 - At this stage, followers are empowered to make decisions and they
Stewardship have control over how they do their own jobs. Leaders give followers
Leader the power to influence goals, systems, and structures and to become
leaders themselves. Stewardship supports the belief that leaders are
deeply accountable to others as well to the organisation, without
trying to control others, define the meaning and purpose for others,
or take care of others.

Stage 4 At this stage, leaders transcend self-interest to serve the needs of

Servant others, help others to grow, and provide the opportunity for others to
Leader gain materially and emotionally. The role of the leader is to enable
people to grow and become all they are capable of being. The leaders
emphasis will be on empowerment, participation, shared authority
and building a community of trust.

Source: Daft (2008)

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Choose the correct answer.

1. Which statement below is false about leadership?

A. The aim pursued by the leaders would be different with that
of the organisation.
B. Whenever leadership is discussed, the concept of leader and
power are inseparable.
C. Leadership is the process of providing direction and
influencing individuals or groups to achieve goals.
D. Traditional concepts of leaderships such as those resulting
from the University of Michigan and Ohio State University
focused primarily on leaders' exchange relationship with

2. The focus of the University of Michigan Studies (UM) include all of

the below EXCEPT:
A. Involves two distinct leadership behaviour styles.
B. The job-centered leader emphasises on employees and their
C. The leaders who were employee-oriented tend to emphasise
on interpersonal relations.
D. The behavioural consideration and job relationship are
expressed as employee-oriented and production-oriented.

3. Which statement below describes the Managerial Grid?

A. The grid proposes four dimensions of leader behaviour.
B. It has features similar to the work done by the Michigan and
Ohio State studies.
C. To be most effective, leaders should be on dimensions known
as concern for people and concern for production.
D. Research indicated that leadership effectiveness is more
complicated than the grid proposes.

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4. Which of the following statement is true about transactional

A. Followers comply with leaders wishes to gain desired
B. They provide clear expectations and directions and reward
followers based on performance.
C. Transactional leaders are suitable for matters relating to the
daily management of an organisation.
D. All of the above.

5. The Fiedlers Contingency model of leadership effectiveness suggests

all statements below EXCEPT:
A. Taskoriented leaders are more effective in highly favourable
B. Situation favourableness is determined by the amount of
influence a leader has.
C. Effectiveness depends on the match between a leaders style
and the degree of favourableness of the situation.
D. The important situational characteristics in the model are
government and employers relations, product structure and
leaders position power.

Based on the leadership attributes discussed at the beginning of the topic, we

have learned that leadership qualities are inborn or attained through
exposure and formal training.

Whilst a manager need not necessarily be a leader, he/she should have good
leadership qualities in order to be successful.

The trait theory relates to the characteristics of a leader.

The behaviour theory studies actions which contribute to successful


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The contigency theory focuses on leaders success as situation related. There

are two contigency theories the Fiedler model and the Hersey and
Blanchard situational theory.

Each of the varying theories on leadership has their respective

strengths and weaknesses, requiring a manager to understand and identify
the most appropriate theory or theories to be employed within the

Conclusively, in this challenging era of globalisation and information and

communication technology, a manager has to be equipped with superior
leadership qualities.

Therefore, the neo-charismatic leadership approach, namely,

transformational leadership, may fill this need.

Nowadays, the emerging leadership perspectives focus on moral leadership

and servant leadership.

Behaviour theory Legitimate power

Coercion Neo-charismatic theory
Contingency theory Referent power
Expert power Trait theory
Servant leadership Moral leadership

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Topic Communication

By the end of this topic, you should be able to:
1. Explain the main functions of communication;
2. Discuss the processes involved in communication;
3. Assess the six barriers to effective communication;
4. Illustrate the flow and communication networks that exist in groups
and teams;
5. Appraise formal, informal and non-verbal communication as well as
effective communication channels; and
6. Discuss contemporary issues in communication.

Generally, communication is the sharing of information between two individuals
or groups for the purpose of arriving at a mutual understanding. It involves the
process of transferring information and exchanging meanings from one
individual to another by using meaningful symbols. It is one way for us to share
and convey information, ideas, attitudes, values and opinions. An idea may be
great, but it is useless until it is transmitted and understood by others.

Communication is said to be effective when the receiver perceives the message

transmitted by the sender as exactly as it is intended (by the sender). In this
instance, a sender (who has a message to convey) initiates the communication
process. This process is completed when the receiver responds by providing
feedback as to whether he has understood the message or otherwise (refer to
Figure 8.1).
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Figure 8.1: Call center agent (the receiver) gives an appropriate

response to the message intended by the caller (the sender)

Communication activities undertaken by managers generally involve

interpersonal communication and the sharing of information with other
members of an organisation.

In this topic, we will discuss the various aspects of communication. We will start
with the functions of communication, the communication process and the basics
of communication. This topic also touches on overcoming communication
barriers and contemporary issues in communicating.


A good start to Topic 8 calls for an understanding of the functions of
communication and the related processes. Communication has four major
functions within a group or organisation: control, motivation, emotional
expression and information.

Communication acts to control the behaviours of members in several ways and

organisations have authority hierarchies and formal guidelines that employees
are required to follow. For instance, communication performs its control
functions when employees are required to report (communicate) any task related
problems to their immediate boss, instructed to adhere to their job descriptions
and comply to company policies.

Communication fosters motivation by clarifying to employees what needs to be

done, how well they (employees) are performing on their job and what
employees should do to improve performance. Communication performs its
motivational function in the processes of formulation of specific goals, provision
of feedback on employees progress towards goals, and reinforcement of desired
behaviour amongst employees.

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In its function as a tool for emotional expression, many employees regard their
work group as a primary source of social interaction. This is in view of the fact
that the communication which takes place within the group is a fundamental
mechanism by which members express their frustrations and feelings of
satisfaction. In this instance, communication provides a release for emotional
expression of feelings and fulfilment of social needs.

The final function of communication is related to its role in facilitating decision-

making by providing information required by individuals and groups in order
for them to make decisions. The data is used to identify and evaluate alternatives
in the decision-making process.

All the mentioned four functions of communication are equally important. For
instance, organisations are able to perform effectively when they are successful
in maintaining some form of control over its members, provide motivation for
members to perform in a good way, provide a channel for members to express
themselves emotionally and allowing members to make decisions.

So we can assume that most communication interaction that takes place within a
group or organisation performs one or more of these four functions.


List other functions that you feel are useful to a group or an



Before we continue with our discussion on the processes involved in
communication, have you considered what you can do to ensure the receiver
receives your message in the exact manner you intended for the message to be

Communication can be perceived as a process or flow, consisting of two phases:

(a) Transmission; and

(b) Feedback.

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During the transmission phase, information is shared between two or more

individuals or groups. The feedback phase reflects the achievement of the
intended message. There are a few stages involved in the process of
communication within the two mentioned phases. This is described in the
Communication Process Model in Figure 8.2.

Figure 8.2: The communication process model

Source: Adapted from Jones, G. R., George, J. M., & Hill, C. W. L. (2000)

8.2.1 Communication Process Model

There are two phases in the communication process model. These phases are:

(a) Transmission Phase

Beginning at the transmission phase, the sender (a group or an individual)
who wants to convey a particular information to another group or
individual, transmits the message (information to be shared) utilising either
one or more of the following: verbal (speech), non-verbal (gesture, hand
movement and facial expression) written or drawn.

Next, the sender interprets the various types of transmitted messages either
symbolically or in a form that is understood by him/her. This is known as
the encoding process. Normally the message is encoded in words. The
process of encoding messages can be influenced by the senders skills,
attitude, knowledge and socio-cultural system.

The channel refers to the medium used to transmit the encoded message to
the receiver such as the telephone, letter, memo, e-mail, voice mail, or
conversation (face-to-face).

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The next phase is when the receiver interprets or puts meaning to the
message. This process is known as decoding. The decoding process, on the
other hand, is influenced by the receivers skills, attitude, knowledge and
socio-cultural system. These factors collectively influence the receivers
ability to receive and interpret a message. This is the most critical stage in
communication. Since the receiver may decode the message according to
his/her social and cultural values, it may cause the receiver s failure to
correctly interpret the message; which could lead to a misunderstanding of
the message.

(b) Feedback Phase

The feedback phase begins with the receiver (now the sender) providing
feedback by sending a message to the initial sender (who now assumes the
role of a receiver), encodes the message, and sends it back via a selected
channel. This feedback is normally for the purpose of obtaining
confirmation on whether the message has been received and correctly
understood or to elicit further information.

The initial sender will then decode the message and ensure mutual
understanding has been achieved. If the initial sender finds that the
message has been misinterpreted, the whole communication process is
repeated until both parties achieve the desired comprehension.

Not all processes of communication run smoothly in view of the possibility

of potential noises that can affect the effectiveness of communication. Noise
is a general term used to refer to something that interrupts the transmission
or comprehension of the message.

Noises occur due to many factors, including: the encoded message is

unclear; the sender is unsure of the message he wants to transmit; the
wrong communication channel is selected, the message is wrongly
decoded; illegible writing; poor hearing or vision; great physical distance
between sender and receiver; the receivers lack of time to properly decode
the message; or lack of experience, knowledge or certain skills. In this
instance, managers can improve communication by minimising noises.

8.2.2 Barriers to Communication

There are several barriers that result in messages being wrongly decoded by
receivers (different from the original intention of the sender). Figure 8.3 depicts
the major barriers to effective communication.

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Figure 8.3: Barriers to communication

Following are the explanations for the barriers to communication:

(a) Filtering
Filtering refers to a senders manipulation of information to enable the
receiver to better understand the intended message. For example, when a
manager tells his boss what he feels his boss wants to hear, the manager is
filtering information.

Does this occur in organisations? Yes, in many instances information

conveyed to superiors are filtered beforehand so they (superiors) only
receive important and relevant information. Filtering is influenced by the
sender s perception and personal interest.

Filtering often occurs in organisations where there are pronounced status

differences among aspiring employees. Large organisations also provide
allowances or space for filtering to occur since large organisations are made
up of many vertical levels. It is natural for larger organisations to have
more filtering incidences as compared to smaller ones.

(b) Selective Perception

Selective perception is relevant in communication because a receiver has
the tendency to see and hear a message based on the receivers respective
needs, motivation, experience, background and other personal
characteristics. Receivers also project their interests and expectations into
communication as they decode a message.

An example would be an employment interviewer who already has her

expectations of a candidate in view of her present perception, without
being aware of the accuracy of her existing perception or expectation. This
pre-determined perception or expectation might result in the selection of an
unsuitable candidate for the vacant position.

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(c) Information Overload

Individuals have limited capacity for processing data. In fact, researchers
have shown that most of us would have problems when we have to handle
more than seven bits of information.

Information overload occurs when the information we have to work on

exceeds our processing capacity. E-mails, faxes, phone calls and meetings
are forms of information that are received on a daily basis by an executive.

What happens when an individual has more information than they can sort
out and use? They will select, ignore, pass over or forget the information. In
addition, they might also delay the processing of the said information until
the overload is settled. This results in lost information and less effective

(d) Defensiveness
When an individual feels threatened, they are more likely to withdraw from
the process of reaching a mutual understanding. In this instance, an
individual defends himself by displaying negative behaviour, being cynical
and doubting the motives of others. Therefore, when an individual interprets
messages from others as a threat, the feedback transmitted by him acts as a
barrier to effective communication.

(e) Language
Words mean different things to different people. The variation in meanings
is a result of the differences in age, level of education and cultural
background. These variables influence the language that a person uses and
the manner in which he defines words that are transmitted and/or

In an organisation, employees usually come from diverse backgrounds.

This factor alone creates many different ways of speaking, in addition, to
the respective jargon or technical language of various work groups.

In large organisations, the frequent and wide geographical dispositions of

members also result in the use of unique terms and phrases according to
ones place of origin. Similar situations also occur when there are multiple
vertical levels in an organisation. In this instance, subordinates might not
easily understand the language used by superiors.

Differences in language used at various levels of the workplace can lead to

misinterpretation and an inaccurate interpretation of messages, which can
affect communication due to the misunderstanding of messages.

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(f) Communication Apprehension

Another major barrier to effective communication is communication
apprehension, which is also known as fear of communication. There are
approximately 5% - 20% of the population who suffers from fear of talking
in public. Communication apprehension is a serious problem since it affects
a whole category of communication techniques. Those who suffer from it
experience undue problems and anxiety in oral or written communication
or both. For example, those who fear oral communication may find it
extremely difficult to talk with others face-to-face or even through a
telephone. As a result, they may rely on memos or faxes to convey
messages when a phone call may be faster and more appropriate.

Studies have shown that individuals who fear oral communication would
avoid situations that require them to engage in this type of communication.
These individuals are concerned that their fear to communicate will
prevent them from participating in any discussion that requires their input.
Accordingly, they would avoid careers in which oral communication is the
main requirement, e.g. teaching and marketing. However, there is no
escaping the fact that many careers require oral communication.

So we need to be aware of the fact that there are people who try to avoid
situations which require them to speak and they often feel that oral
communication skills are not necessary for them be effective at work.

In conclusion, communication becomes ineffective when the barriers

discussed above are not handled effectively. In order to improve the
effectiveness of communication, the first step is to raise awareness among
managers and members of an organisation on the importance of
communication skills in meeting organisational goals.


1. Using a diagram, explain the processes involved in communication.

2. Discuss the six barriers that can undermine effective


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Next, we will discuss the basics of communication. In communication, an
understanding of the basic concepts is important. Figure 8.4 shows the basic
concepts of communication. These concepts will be reviewed in detail.

Figure 8.4: The basic concepts of communication

8.3.1 Direction of Communication

Communication flows either vertically or laterally. The vertical dimension can go
in two directions; upward and downward (refer to Figure 8.5).

Figure 8.5: Communication flow

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Let us take a closer look at these communication flows:

(a) Downward
Communication that flows from one level of a group or organisation to a
lower level is known as a downward communication, i.e. managers
communicating to employees. This type of communication is used by
managers to instruct employees, provide job instructions, inform
employees of policies and procedures, point out problems requiring
attention, provision of feedback on performance, and ensuring the
organisations goals and objectives are clear to all members of an
organisation. Downward communication also takes place to prevent the
spread of rumours on any impending changes.

Downward communication need not necessarily be performed orally or

face-to-face. Memorandums and all forms of written letters prepared by
management to employees are also forms of downward communication.

(b) Upward
Upward communication flows from employees and/or managers to
superiors of higher levels in a group or an organisation. Upward
communication is used to provide operational feedback, issues and
problems and information on performance and effectiveness of the
organisation to the superiors. This type of communication encourages the
lower management and employees to be involved in decision-making
whilst providing them (employees) with the opportunity to share their
work concerns with top management.

Upward communication also enables managers to discover employees

level of satisfaction with their jobs, work-relationship between colleagues,
and the organisation in general. Managers also rely on upward
communication for ideas on improvement of plans and schemes.

Some examples of upward communication are appraisal reports prepared

by the lower management for the middle and top management, suggestion
boxes, a survey on employees attitudes, a discussion between managers
and employees, giving both a chance to discuss ground-level problems
with the higher managers.

(c) Lateral
Lateral communication flows between managers or employees at the same
level within the group or organisation. For example, lateral communication
occurs when the morning shift supervisor discusses with the evening shift
supervisor, or when the marketing manager meets the finance manager to
discuss costs and the new marketing strategies.

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Lateral communication facilitates and expedites coordination and

cooperation between various divisions in an organisation and enables
colleagues to share related information. It also helps those at the same level
to resolve conflicts and overcome problems without intervention from the
top management.

However, lateral communication is not without its problems. Firstly, it

could lead to conflict between the lower and upper management when the
former fails to adhere to proper procedures pertaining to issues that occur
beyond the knowledge of the latter.

8.3.2 Formal and Informal Channels

A network of communication refers to channels for information flow. There are
two types of channels, as shown in Figure 8.6.

Figure 8.6: Types of channels

Below are the explanations for these two types of channels.

(a) Formal Channels within Groups and Teams

Figure 8.7 shows the four basic channels for groups and teams: chain,
wheel, circle and all channels.

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Figure 8.7: Communication networks in groups and teams

Source: Adapted from Jones, G. R., George, J. M., & Hill, C. W. L. (2000)

In the chain network, members communicate with one another along the
chain of formal command. This network exists in work groups whose task
is characterised by sequential task interdependence, e.g. an assembly line.
Each task depends on the task before it. This form of network produces
moderate accuracy and speed in completing simple and complex tasks.

This pattern of network also gives little satisfaction to group members. The
chain network is seldom practised in groups because it offers limited
members interaction.

In a wheel network, information flows to or from a team member who

normally acts as a leader. Despite the fact that other members do not
communicate with one another, the team is able to achieve its goals since it
is communicating via the leader.

This type of network exists in groups that practise pooled task

interdependence where each member has to do his/her part in order to
complete a task. It is an ideal network format for simple tasks to be
performed efficiently and accurately. However, this network is not suitable
for complex work. In addition, many individuals do not find this type of
wheel network as attractive and it is not a common choice for many since it
discourages close interaction among members.

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The circle network allows group members to communicate with those of

similar experiences, beliefs, expertise, background, office location and so
on. Members of a particular work team or committee usually prefer to
communicate with others of similar experiences or background.

This kind of network provides the space for individuals to give feedback. It
also allows for quick and correct decisions pertaining to complex tasks.
Work groups commonly apply the circle network since members obtain
better work satisfaction with it.

The all-channel network can be found in teams and can be categorised as

higher-level communication. Each team member communicates with one
another in the team. Top management teams, as well as cross-cultural and
self- managed teams, commonly apply this form of network.

Groups that practise reciprocal task interdependence communicate in

this all-channel network, thereby enabling information to flow from all
directions. While this form of network is not particularly suitable for simple
tasks, it is very efficient and accurate for complex tasks. In addition, it also
allows for a greater level of member satisfaction.

There have been a few software programmes designed to facilitate groups

that practise the all-channel network. This type of network allows for better
and more efficient communication among members. It also promotes effective
group communication.

(b) Informal Network

An informal communication network refers to the transmission of
messages from one employee to another without using the formal channel
whilst moving away from the flow of the organisational chart.

The grapevine exists because of human curiosity about what is happening

in an organisation and how it is going to affect other individuals. In order
to satisfy this curiosity, employees need consistent, relevant, accurate and
detailed information about who did what, and the current changes that are
taking place in the organisation. However, is the grapevine an important
source of information? The answer is yes since evidence has shown that
75% of employees usually obtain their first information pertaining to new
issues in an organisation from the grapevine or rumours.

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Grapevines have three main characteristics:

(i) They are not controlled by the management;
(ii) Most employees view the information derived from the grapevine as
more believable and reliable than formal communication; and
(iii) It is largely used to serve the self-interests of the people within it.

Evidence shows that 75 to 95 percent of grapevine information is accurate

due to the following factors:
(i) Information circulated is current, exciting and timely.
(ii) Since it is communicated face-to-face, the sender is able to obtain
immediate feedback from the receiver to ensure correct interpretation
of the message. This prevents miscommunication and ensures
(iii) Accuracy can be further verified by obtaining confirmation from other
employees. The grapevine has two forms of network: gossip chain
and cluster chain.

In the gossip chain, an individual with a strong influence shares

information with many managers and employees. On the contrary, a
cluster chain occurs when an individual shares information with a few
selected friends. Speed and freedom characterises the flow of information
for these two networks in an organisation (refer to Figure 8.8).

Figure 8.8: Grapevine network of communication

Source: Adapted from Williams, C. (2000)

How does one manage a grapevine? A manager has to manage grapevines well
because grapevine related rumours could adversely affect the success of an

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A manager can also take advantage of the grapevine to maximise information

flow to employees. When employees are adequately informed about the
organisation, loyalty can be fostered whilst productivity is increased. To manage
grapevines well, managers should encourage its development and strive to be a
part of it so they can obtain valuable feedback to further improve the


1. Discuss the flow of information in an organisation.

2. Compare and contrast formal and informal communication.

8.3.3 Non-verbal Communication

Non-verbal communication refers to all communication that does not involve
words. Normally, it is used together with oral communication to support or
emphasise the oral message or even to contradict it.

Non-verbal communication is very important since many receivers believe that

this form of communication provides a more truthful and accurate picture of
what is thought and felt by the sender. For instance, if you ask a friend out and
they say yes, their opposing facial expression will tell you that your friend is
actually quite reluctant to go. It is therefore very important to pay attention to
non-verbal communication for a more accurate interpretation of messages.

There are two types of non-verbal communication: kinesics and paralanguage

(refer to Figure 8.9).

Figure 8.9: Types of non-verbal communication

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Following are the explanations for these two types of non-verbal communication:

(a) Kinesics refers to body and facial movements, including gestures, facial
expression and eye contact along with other signals. For instance, a person
would normally avoid eye contact when they are shy or unsure of the
message they are trying to convey, while the crossing of legs or folding of
arms usually implies a defensive attitude or that the person is not open to
the message or the sender. Lawyers often use non-verbal gestures to
convey messages to a jury.

(b) Paralanguage refers to a persons tone of voice and this includes pitch, tone,
rate, volume, and the way the message is spoken, whether quietly,
hesitantly or stopping abruptly. For instance, when a person is unsure of
what or how to say something, they would normally speak quietly and
when a person is nervous, they usually speak loudly and fast. All these can
affect the receiver s comprehension. Once again, a lawyer is able to use the
power of his/her voice to positively influence a jury.

In conclusion, although non-verbal communication conveys a lot of information,

it can complicate communication when it contradicts with oral communication.
Managers need to know how to monitor and control non-verbal behaviour to
ensure that messages are conveyed as intended. Table 8.1 lists a few suggestions
on how to improve non-verbal communication.

Table 8.1: Suggestions on How to Improve Non-verbal Communication Skills

Positive Non-verbal Communication Negative Non-verbal Communication

Maintaining eye contact. Avoiding the eyes and not looking at
the speaker.
Nodding to show understanding or Closing the eyes or frowning.
Smiling and showing interest. Open mouthed.
Leaning forward to show interest. Bodily gestures conveying lack of
confidence, e.g. looking down, folding
of arms and a monotonous tone of
Matching the tone of voice to the Talking too fast or too slow.
message conveyed.

Source: Kreitner, R. & Kinicki, A. (2008)

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Non-verbal communication is often said to facilitate better understanding

of a particular message. Provide your opinion as to why non-verbal
communication is important for effective communication.

8.3.4 Choice of Communication Channel

Sometimes a message fails to be communicated effectively due to the wrong
choice of communication channel. Communication channel refers to the medium
used to convey the message.

There are two types of communication medium: oral and written.

(a) Oral Communication

Oral communication refers to the transmission and reception of voiced
messages during face-to-face or group discussions; via the telephone or
video conferencing.

Research shows that managers are in favour of oral communication because

it allows them to ask immediate questions or provide immediate feedback
for verification. Oral communication is an effective form of communication
because managers can receive and assess non-verbal communication that
supports the oral message. In addition, oral communication does not
require the use of personal computers or the Internet.

However, not all communication takes place orally. Generally, memos and
e-mails are more effective in transmitting messages that are concise, clear
and simple.

(b) Written Communication

Written communication includes letters, e-mails and memos. A manager
who prefers oral communication seldom uses written communication. They
also tend to avoid written communication when they have poor writing
and typing skills in addition to having poor knowledge on the usage of the
Internet or e-mail.

Nevertheless written communication is most effective for sending messages

clearly and accurately. In addition, e-mails can be accessed from the office,
at home, whilst travelling using a laptop, or via web-based devices. This
enables a manager to send and receive more messages via e-mail as
compared to oral communication that requires face-to-face interaction.

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However, written communication becomes ineffective if the message to be

transmitted is vague, difficult to understand or emotional in nature. In
these instances, oral communication is a better mode of communication.


By now you would have adequate information about communication and its
functions. Let us look into ways to overcome communication barriers. There are
actions that both organisations and individuals can take to overcome any
communication barriers that may occur. Some are discussed below:

(a) Communication Audits

Analysing the organisations communication needs and practices through
periodic communication audits is an important step in establishing
effective communication. This type of audit examines an organisations
internal and external communication to assess communication practices
and capabilities and to determine needs. It can be conducted in-house (for
example, by the Human Resource department) or by external consulting
teams. Communication audits are used to ascertain the quality of
communication and to pinpoint any communication deficiencies in the
organisation. Audits can be conducted for the entire organisation or a
single unit within the organisation.

(b) Communication Culture

Organisations can also overcome some barriers by establishing a
communication culture where mutual trust exists between senders and
receivers, communication credibility is present and feedback is encouraged.

Managers should also encourage a free flow of downward, upward, and

lateral communication. People must be comfortable in communicating their
ideas openly and in asking questions when they do not understand or want
to know more. Information should be available and understandable.
According to Collela, Miller and Hit (2008), people in organisational units
should be allowed to develop their own communication systems
independently for an effective communication culture.

(c) Encourage Feedback

Communication is a two-way process. This is to ensure that the received
message is interpreted rightly.

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(d) Regulate Information Flow and Timing

Regulating the flow of information can help to alleviate communication
problems. Regulating flow involves discarding information of marginal
importance and conveying only significant information. That is, do not pass
on irrelevant information or else important messages may be buried by
information overload or noise. Proper timing of messages is also important.
Sometimes people are more likely to be receptive to a message and to
perceive it more accurately than others.

(e) Listen Actively

Poor listening skills are common barriers to effective communication.
According to Collela (2006), people tend to hear and understand only
around 25 percent of what is communicated to them verbally. Listening is
not a passive, naturally occurring activity. People must actively and
consciously listen to others in order to be effective communicators.


Which communication channel do you use the most in your workplace?

Discuss with your classmates.


In this section we will discuss a few contemporary issues in communication.
Among them are gender differences in communication, cross-cultural
communication, and communication technology.

(a) Gender Differences in Communication

Research shows that men and women communicate differently in various
ways. Women, for example, prefer to share their accomplishments, ask
questions to seek verification and provide positive feedback. In other
words, they avoid criticising but instead offer praise and indirect advice.
Men, on the contrary, have a tendency to brag, are direct in giving
comments, dislike praising others, prefer not to ask questions, and dislike
admitting their weaknesses and wrongdoings.

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Here, there are two important issues to be considered:

(i) Firstly, do not over-generalise that men and women are the same.
There are some men who do not like to brag about their achievements
while there are women who do not like to share their accomplishments
with others; and
(ii) Secondly, linguistic styles or the language used will influence other
peoples perception of our level of confidence, competence and
authority. This can affect our job and chances of promotion.

How do we improve communication between men and women? Deborah

Tannen, a communication expert, proposed that each individual should be
aware of how linguistic styles influence our perception and decisions. She
believes that sound knowledge on linguistic styles can make other people
listen to our thoughts and ideas. In fact, a positive knowledge of linguistic
differences can assist a manager in formulating ways to ensure everybodys
ideas are heard and fair credit is given to all employees in meetings as well
as situations occurring out of meetings.

It is also a good idea for us to assess the strength of an organisation and the
obstacles it faces in terms of our linguistic styles. By doing this assessment,
we can proceed to make adjustments to our linguistic features that
negatively influence other peoples perception of our confidence,
competence and authority. To conclude, communication between men and
women can be improved with an understanding that men and women have
different ways of saying the same thing.

(b) Cross-cultural Communication

Effective communication is difficult to achieve. Communication as a means
of exchanging meaning is affected by culture. During the encoding process,
ideas that have been translated into a message are represented by symbols
and language whilst the decoding process witnesses the message being
translated back into its intended meaning.

This means messages should be encoded in a form that is understood by

the recipient. However, the symbols and language used depends on the
cultural background of the sender and receiver, which varies from
individual to individual. Individuals from different cultures may encode
and decode messages in different ways depending on their behaviour, style
and the way they interpret a particular thing.

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The mentioned limitations to encoding and decoding of messages are a

barrier to effective communication. Difficulty in communicating may arise
between people living in different geographical regions or between those of
different ethnic backgrounds, irrespective of the fact that they might live
within the same country. Needless to say, communication gets more
complicated between people of different cultures and from different

Communication between people from different countries and cultural

backgrounds is called cross-cultural communication. A common problem
that often arises is ethnocentrism or better known as the tendency to regard
our values and culture as being superior to those of others. This can have a
negative effect on a business or in maintaining diplomatic relations.
Researchers have shown that the greater the cultural difference between the
sender and the receiver, the greater the chances are for miscommunication
(misunderstanding) to occur.

However, there are a few things that can be done to increase the chances of
successful cross-cultural communication, e.g. familiarising oneself with
working norms in a particular culture, or being aware of the terms of
address such as using the first name, family name or by rank.

Finally, we also need to understand the attitude of certain cultures towards

time, punctuality during appointments, punctuality in meeting deadlines,
and punctuality during the conduct of discussions.

(c) Communication Technology

Organisations today are extensively utilising information technology as a
vehicle to raise productivity and increase employee and customer
satisfaction. The pattern of communication in the work place is changing
rapidly with fax, teleconferences, the World Wide Web, electronic messaging
system, and other communication technologies being comprehensively used
to enable communication with virtually anyone, anywhere and at any time,
day or night.

Communication technology represents a wide category of communication

and it is continuously changing and rapidly influencing the manner (how,
when and where) in which a manager communicates. For instance, video
recorders and telephones that can take and respond to messages, facsimile
machines, Internet, closed circuit cameras, computers, and electronic mails
are all technological advances that increase the opportunity for
communication whilst advocating flexibility in communication.

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Computer networks also enable large amounts of information to be stored

and communicated. These networks link a few computers, enabling
individuals to share information, communicate and access information.

In this section, we will review a few main components of information, which

includes telecommuting, e-mail, video conferencing and Internet technology,
which influences the pattern of communication and management in an

(i) Telecommuting refers to the work practice that operates in a different

location using a computer network that connects it to the headquarters
or another work location. This includes those who work outside the
clients office or communicating with the office using a laptop
computer or mobile phone. To date, there are more than two million
corporate employees who telecommute on a full time basis.

The advantages of telecommuting are that it helps reduce costs

because employees can work from home; increases flexibility and
autonomy for the employee; improves job satisfaction; and reduces
employee turnover. This is especially so in cases where there is a job-
family conflict. Telecommuting increases employee productivity as

(ii) Electronic mail (e-mail) is a computer-based system that allows

individuals to receive and save messages in the computer. It operates
on a network of computers. Messages can be written and received by
anyone who has access to a computer terminal. It uses the Internet or
Intranet to send text and computer documents from one individual to

E-mail saves cost and time. Multiple copies on paper need not be made
when information needs to be sent to many different people. E-mail can
also be used as an instrument to improve teamwork and it is a form of
communication that is fast, relatively cheap, efficient and flexible. In
addition, it promotes vertical and horizontal communication because it
involves a substantial amount of information exchange. This also
encourages employees to learn how to manage information.

(iii) Video conferencing, also known as teleconferencing, uses video or

audio and a computer connection to enable individuals located in
different places to interact with one another. In this instance,
individuals from different locations can conduct a meeting without
having to meet physically, thus reducing the cost of travelling.

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Many organisations currently have dedicated rooms equipped with

television camera paraphernalia for the purpose of conducting
teleconferencing; enabling employees to conduct long distance
meetings and training sessions without leaving the office.

(iv) Internet (or commonly known as The Net) is a network that links
computers and networks of computers around the world. It is a global
network that operates independently but interconnected with one
another. The net connects more than 140,000 smaller networks in
more than 200 countries. The internet links all types of computers,
from supercomputers right through to mainframes in businesses, the
government, universities and personal computers at the office and at

(v) Intranet, on the contrary, is like a private Internet operating in an

organisation. It consists of firewalls which are security procedures to
prevent outside users from accessing the organisations information
for the sake of guarding confidential company documents.

(vi) Extranet connects employees within an organisation to selected

external parties like clients, suppliers, and other strategic business
partners. It only allows selected parties to access company
information but at the same time it is also built with security features
to protect the companys confidential matters and/or documents.

The main benefit of the Internet, intranet and extranet is their capability
to increase the employees capacity for obtaining, creating, managing,
and disseminating information. Their effectiveness, however, depends on
how far an organisation has gone in setting up and managing the
network and how employees use the obtained information. In conclusion,
proper and efficient use of technology can increase productivity and
quality of work.


1. What are the elements involved in the communication process?

Elaborate on these elements.

2. List the challenges faced by managers or organisations in using

the internet as a communication tool.

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Choose the correct answer

1. The alternatives below refer to organisational barriers to effective

communication EXCEPT:
A. Status differences.
B. Poor listening skills.
C. Semantic differences.
D. Encouraging feedback.

2. Individuals can improve their interpersonal communication by:

A. Knowing their audience.
B. Regulating information flow and timing.
C. Selecting appropriate communication media.
D. All of the answers above.

3. Written communication becomes ineffective for all of the situations

below EXCEPT:
A. When the message is vague.
B. When the message is emotional in nature.
C. When the message is difficult to understand.
D. When people have good knowledge on the usage of e-mail.

4. Which of the statements below is true regarding communication

A. The pattern of communication today is changing very slowly.
B. Men and women communicate similarly in many different
C. Communication as a means of exchanging meaning is
affected by culture.
D. Difficulty in communication may not arise between people
living in different geographical regions.

5. Non-verbal communication is related to:

A. Body and facial movement.
B. Transmission and reception of voiced messages.
C. Rumours that could affect success of communication.
D. None of the above answers.

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Knowledge about communication is important since there is a strong

relationship between communication and job satisfaction.

There are two phases in the communication process model transmission

and feedback.

Interruptions, vagueness and inequality will negatively affect communication

effectiveness. Therefore, when noises are reduced, communication
effectiveness increases.

Employees receive more information accurately and efficiently when there

are minimal noises in communication.

There are certain barriers to effective communication in an organisation, such

as filtering, selective perception, information overload, defensiveness,
language and communication apprehension.

In order to overcome these barriers and communicate effectively, managers

should develop certain communication skills.

The use of vertical, horizontal, formal, informal and non-verbal

communication improves the flow of communication, reduces uncertainty
and leads to improved performance and group satisfaction.

As a sender of messages, a manager should send clear and complete

messages by encoding the message in symbols that are easily understood by
receivers whilst selecting a channel appropriate for the kind of message to
be transmitted.

Managers should also ensure receivers give relevant and accurate feedback
to avoid any misunderstanding and spreading of rumours.

Managers have to pay close attention, be good listeners and understand the
linguistic style used by employees so that the flow of information is smooth
and unimpeded. A lack of understanding of these aspects will lead to
ineffective communication.

The emergence of communication technology has increased the effectiveness

of communication in organisations.

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The use of the Internet, Intranet, Extranet, telecommuting, video

conferencing, and many more has accelerated the flow of information
between groups and individuals, regardless of time and location. As a
result, it is no longer a necessity for individuals to meet face-to-face for

All-channel network Communication barriers

Chain network Defensiveness
Circle network Filtering
Cluster chain Gossip chain

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Topic Organisational
Structure and
9 Culture
By the end of this topic, you should be able to:
1. Discuss the main elements that determine the structure of an
2. Differentiate between simple, bureaucracy and matrix designs of an
organisation structure;
3. Appraise the reasons for structural differences in different
4. Explain three layers of culture analysis;
5. Discuss the characteristics of organisational culture;
6. Classify five functions of culture; and
7. Examine how culture is learned in an organisation.

Organisational structure is an element of an organisation, which has to be
formed in line with organisational goals. This is in view of the fact that formal
organisational structure is the basis of all actions undertaken by the management
of an organisation. Since organisational structure is essential in determining the
productivity level of an organisation, it should be formed only after factors such
as strategy, size, technology and organisational environment/surroundings have
been determined.

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Culture plays an important role in influencing the actions of members of a

society. Nevertheless, it has been realised that organisations too have their own
culture and the cultures influence the behaviour and actions of members of the
organisation. This ultimately affects the productivity and profitability of the
organisation. Therefore, an understanding of culture and how to promote a
positive culture is essential.

This topic will outline the structure, design of organisational structure and effects
of culture on organisational behaviour.


To understand an organisation, it is very important to comprehend its structure
since the structure determines the formal division, grouping and coordination of
jobs within the organisation.

An organisation structure underlines the overall task-related issues in an

organisation, i.e. the types of jobs that need to be done and the individual/s
responsible in executing the various tasks on hand. In this instance, organisation
structure can be illustrated through an organisation chart, which is a chart that
shows all types of positions, an individuals position responsibility and line of
authority that connects those positions.

According to Robbins (2008), there are generally six main elements that a
manager has to consider prior to the formation of an organisational structure.
These elements are depicted in Figure 9.1.

Figure 9.1: Six elements forming the organisational structure

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9.1.1 Job Specialisation

Job specialisation has long been regarded as the most efficient way to carry out
tasks in a production process. This can be done by breaking up a job into several
smaller tasks, with each employee having to perform only one task repeatedly.
For example, in a car manufacturing process, an employee who is assigned to
install or assemble the front left wheel tyre will only be doing this job throughout
his/her employment.

Therefore, the term job specialisation refers to which levels of tasks in an

organisation can be broken down into smaller job functions.

Naturally, there are jobs that require high levels of specialisation and there are
also jobs that combine several tasks of different types of activities to increase
levels of job satisfaction. An experienced manager will implement this job
specialisation by determining jobs that are suitable to be broken down into
smaller tasks, so that the employee can perform the smaller task more
efficiently.His productivity will therefore increase.


List the advantages and disadvantages of job specialisation, which are

carried out in organisations such as a car assembly factory.

9.1.2 Departmentalisation
Departmentalisation occurs only after jobs have been formed. For instance,
several types of jobs are divided into groups in order to better facilitate work
coordination. This is known as departmentalisation.

Departmentalisation is done based on several factors, which include function,

product, geography, process and customer. Table 9.1 explains this in more detail.

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Table 9.1: Types of Departmentalisation

Types of

Function Departmentalisation based on job functions occurs when

engineering, financial, human resource and marketing
experts are placed in different departments. As a result,
different departments will exist such as the Human
Resource Department, Production Department, Accounting
Department and Marketing Department.

Product Departmentalisation also occurs based on types of products.

A good example would be a factory that produces
detergents. The detergents produced may be divided into
three types: dishwashing liquid, clothes or laundry wash
and floor detergent. Therefore, this factory will have three
separate departments that are responsible for all aspects
pertaining to the production, quality control, and sales and
marketing of these detergents.

Geography Departmentalisation based on geographical location is an

option for organisations to provide customer service or after
sales service. For example, the East Coast regional service
department may be responsible for customers in Pahang,
Terengganu and Kelantan.

Process Departmentalisation based on process occurs when

individual departments specialise in one particular phase of
production. This application is suitable only if those phases
utilise specific skills. For example, a hospital has many
specific departments that handle specific job functions or
tasks, for example X-Ray (or Radiology), Orthopaedics,
Anaesthetics and Gynaecology.

Customer Departmentalisation based on various types of customers.

For example, employees are divided into customer service-
oriented departments that look into the needs of retailers,
wholesalers and government departments.

In conclusion, the management of an organisation has to decide which forms or

types of departmentalisation are most suitable for its respective business
dealings. Interestingly, large organisations with various offices all over the world
may adopt various forms of departmentalisations to suit the respective offices
and/or branches with its business dealings.

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Now that you are aware of the various ways that departmentalisation is
formed, discuss what form of departmentalisation is being practised at
your workplace.

9.1.3 Chain of Command

Another important element in an organisation structure is the chain of command
which is an organisations continuous line of authority, beginning from upper
management and ending at the lowest level position in the organisation.

In general, a chain of command depicts the line of reporting of each employee

and the higher authorities that employees should refer their work-related
problems to. A chain of command also provides guidelines to managers
pertaining to employees who are within their responsibilities.

When discussing a chain of command, there are two important concepts that
need to be reviewed as shown in Figure 9.2.

Figure 9.2: The concepts related to chain of command

The world of todays management is experiencing many changes. Management

based on teams i.e. cross-functional and self-management teams have become
more popular. Information technology (IT) too has begun to control various
types of businesses and trends to empower employees are also taking place. IT
has enabled them (employees) to communicate directly with whomever they
want without going through formal channels and regardless of where they are.

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Looking at current situations and trends, state your opinion on whether

authority concepts and unity-of-command are still relevant. Discuss
with your classmates.

9.1.4 Span of Control

Determining span of control is also very important because it shows the total
number of subordinates that can be efficiently supervised by a manager. In this
case, the span of control can determine the total number of levels and managers
who exist in an organisation.

For example, despite having a similar number of employees, an organisation will

have fewer levels and fewer managers if the managers are given a wider span of
control compared to an organisation that bestows its managers with a narrower
span of control.

As such, organisations with a larger span of control are more cost efficient since
they (the organisations) save on the cost of the managers salaries. However,
since the control scope is large, employees performance can be negatively
affected due to a lack of support and leadership from the supervisor.

Control scope that is too narrow also has its weaknesses. First and foremost,
while many levels of management can increase costs, the narrowness in the span
of control can also make communication, especially vertical communication,
difficult. Thus, resulting in a longer decision-making process.

9.1.5 Centralisation and Decentralisation

In some organisations, the top or upper management makes all the decisions
concerning the organisations. Such organisations are said to use the centralised
decision-making method.

The term centralisation refers to the level/stage where decision-making is

focused on one position in an organisation.

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An organisation is known as a centralised organisation when only the top

managers make all the main decisions with minimum or no input from lower
level staff.

On the other hand, the term decentralisation refers to an organisation

which not only allows staff from all levels to provide related input, but also
gives them the power to make decisions.

In this instance, the term decentralisation refers to how much of decision

making freedom is provided to an employee from an operational level.

In a decentralised organisation, more freedom is also given to operational

managers in making decisions. Therefore, problem-solving actions can be carried
out faster and workers do not feel alienated from the people who make the
decisions and whose decisions affect their lives at the work place.

9.1.6 Formalisation

Formalisation refers to the degree in which each job in the organisation has to
be carried out in accordance to pre-determined standards.

A job with a high formalisation level determines what needs to be done,

timeframes for completion and methods of completing those matters. In short, an
employee does not have the freedom or liberty in carrying out the job in his/her
own respective way. In fact, they have to continuously handle their work in a
similar manner to produce the same and consistent output. This refers to formal
organisations with broad organisational rules, clear and highly organised work
procedures, and explicit job descriptions for each job.

The degree of formalisation differs from one organisation to another.

Organisations such as the military, police and fire department have a very high
degree of formalisation in comparison to small ordinary companies (such as
retail trading/services).

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In a situation where all other factors are the same, is a large span of
control more efficient that a narrow span of control or otherwise?


In addition to the six elements that form an organisational structure, we also
have to know three other common organisational structures. These three are the
simple structure, bureaucracy and the matrix structure.

9.2.1 The Simple Structure

An organisation with a simple structure has the following characteristics:

(a) Low degree of departmentalisation;

(b) Wide span of control;
(c) Centralised authority; and
(d) Low degree of formalisation.

This simple structure is usually practised by small businesses, in which the

business owner and manager are the same person, for example a mini market or
a clothing retailer.

9.2.2 The Bureaucracy Structure

The bureaucracy structure, which is based on standardisation, has the following

(a) Highly specialised work especially for work on routine operational level;
(b) Having formalised rules and operational procedures;
(c) Tasks are grouped according to departments, which are functional based;
(d) Centralised authority;
(e) Narrow span of control; and
(f) Decision-making that follows the chain of command.

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Good examples of organisations with a bureaucracy structure are government

departments. In fact, almost all government departments practise the bureaucracy

9.2.3 The Matrix Structure

Another popular structure is the matrix structure. The matrix structure is a dual-
authority structure that combines both function and product based

Organisations that usually use the matrix structure include building contractors,
advertising agencies, hospitals, universities and several other organisations.
Table 9.2 shows an example of a construction company, which uses the matrix

Table 9.2: An Example of The Matrix Structure for a Construction Company

5-Storey 2 Blocks of Bandar Dua

Project Bridge Across
Hospital 3-Storey School Main Hall
Department Sg. Satu
Building Building Building


The example in Table 9.2 clearly shows that while in the matrix structure, the
unity-of-command does not exist since employees have two superiors, i.e. project
manager and department manager, it is a structure which is widely used due to
its flexibility.


1. Provide two advantages and two weaknesses for each of the

structures discussed above, i.e. simple structure, bureaucracy and
matrix structure.

2. What is the matrix structure and in which kind of situation is it

suitable for use?

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In addition to the three design structures discussed above, changes in the
business arena have introduced several other new design structures such as team
structure, virtual organisation and organisation without boundaries.

9.3.1 The Team Structure

In Topic 6, we discovered how widely the word team is used in carrying out
work activities in organisations. When an organisation is based on teams, then a
team structure is formed.

The primary characteristics of a team structure are shown in Figure 9.3.

Figure 9.3: The primary characteristics of a team structure

In a small organisation, all work activities can be arranged according to teams.

However, in large organisations, the team structure is often combined with the
bureaucracy structure. This enables the organisation to achieve efficiency
through fixed standards whilst receiving the flexibility needed through the work

9.3.2 The Virtual Organisation

In terms of structure, the virtual organisation, also known as the network or
modular organisation, practises centralised decision making which involves very
little or no departmentalisation.

Virtual organisations are usually small-sized companies that implement only

core organisation activities. Most other activities and business functions are
usually outsourced to other organisations.

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An example of this type of business is a wedding planner company, which is

illustrated in Figure 9.4, where the core activities are preparing wedding outfits
and sets for rent. Other wedding related activities, such as the preparation of
invitation cards, tents and food, are outsourced to other companies that have
been contracted by this wedding planner company. The advantage of a virtual
organisation is its flexibility, but it cannot control the works of its contractors.

Figure 9.4: An example of a virtual organisation

9.3.3 The Organisation without Boundaries

An organisation without boundaries tries to eliminate the chain of command,
practises unlimited spans of control and replaces departments with empowered

In this instance, the vertical barrier is eliminated to make a flatter organisation.

As a result, status and ranks are minimised whilst decision-making requires the
involvement of all parties. In addition, horizontal barriers due to the formation of
departments according to functions are also eliminated.

In general, the execution of work is through cross-functional teams and work

activities are based on process and not type of work. In fact, if proper care is
taken to carry out the activities in an organisation without boundaries, various
barriers caused by the external environment and geographical location can be
broken down. This will result in easier formation of strategic alliances, global
organisations and customers and supplier linkages.

To realise these organisations without boundaries, an important technological

advance has come through, that is, network computers. Through network
computers, communication among employees easily occurs, without the intra-
organisational and inter-organisational barriers.

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From the above discussion, we now understand that there exist many types of
organisational structures. However, we need to bear in mind that there are
various forms of organisational structures that are not explained here.


Now, let us find out why organisations need different kinds of structure. Despite
the fact that there are many organisational structures, these can all be divided
into two extreme structure models: mechanistic model and organic model.

(a) The Mechanistic Model

The mechanistic model is a model that has bureaucratic characteristics and
characterised by extensive departmentalisation, high degree of formalisation,
a clear chain of command, narrow spans of control, limited communication,
and limited participation by low-level members in the organisations
decision making.

(b) The Organic Model

The organic model has the opposite characteristics from the mechanistic
model. The structure of the organisation without boundaries can be
classified as having the organic model. The characteristics of an organic
model are flat organisation involving a lot of cross-hierarchical and cross-
functional teams; low formalisation; having a comprehensive information
network; and high participation of all employees in decision-making.

It is clear that different organisations have different structures. However, what

are the factors that influence an organisations structure? There are four factors,
which have been identified as determining the structure of an organisation, as
shown in Figure 9.5. The next subtopic will discuss these factors in greater detail.

Figure 9.5: The factors that influence an organisations structure

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9.4.1 Organisation Strategy

The strategy of an organisation usually comprises the organisations objectives.
The organisation structure is normally formed according to its needs in order to
successfully achieve its objectives.

In todays business environment, there are three strategic dimensions that are
well-received, which are the innovation strategy, cost-minimisation strategy and
imitation strategy.

(a) Innovation Strategy

This strategy focuses on creating new products or services. An organisation
under this strategy will encourage its employees to be innovative and
produce new items. Normally, organisations under this strategy would
practise a loose structure (organic) with low levels of specialisation and
formalisation. Creativity is further encouraged with a high degree of
employee involvement in decision-making.

(b) Cost-minimisation Strategy

This strategy focuses on practising strict cost control. For this purpose, all
activities that involve costs such as innovation and marketing are
considered as unimportant. On the contrary, what is considered very
important is the low price offered to costumers.

Therefore, the mechanistic structure is most suitable for organisations such

as this to minimise cost and have strict control from the centralised
leadership. In addition, a high degree of work specialisation is also
required because this can spurt production.

(c) Imitation Strategy

This strategy encourages the creation of new products and/or moving into
new markets, and will only take place when proven to be profitable and
successful. This strategy tries to minimise risks and maximise profit gains.

Therefore, organisations will only imitate ideas from successful new

products. For this purpose, a combination of mechanistic and organic
structures is suitable because strict control is needed for activities that are
being carried out whilst relaxed control is required to enable organisations
to implement new activities.

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9.4.2 Organisation Size

The size of an organisation also plays an important role in determining the form
of its organisation structure. In Malaysia alone, there are various organisation
sizes with small and large organisations, from only 10 employees to 500, and to
1000 employees. The Malaysian government is the biggest employer in this
country, with more than one million out of eight million working people. They
work in different departments, ministries and also states.

In this instance, the centralised structure is not suitable for the Malaysian
government to manage its employees. On the contrary, a high degree of
formalisation and bureaucracy is important to ensure that its management runs
smoothly. On the other hand, a restaurant that has only ten employees does not
require departmentalisation and decentralised decision-making as compared to
the organisational needs of the Malaysian government.

9.4.3 Technology Used

Technology refers to the way an organisation transforms its inputs (financial,
human resources and physical resources) into outputs. Since every organisation
must use at least one type of technology, what differentiates one organisation
from another is the type of technology used. The type of activity involved
determines the type of technology used by the organisation.

For example, a company that provides legal services would not require the kind
of sophistication and state-of-the-art technology as a vehicle manufacturing
company. This is because the selection of technology is influenced by the degree
of routiness of the work done in the organisation. The higher the degree of
routineness, the easier the work to be done by the machines. On the other hand,
the use of machines is minimal for work that is not routine and which requires
the employee to make decisions based on information and experience.

Studies relating to technology and structure have found that organisations that
have routine work and use routine technology, such as companies
manufacturing consumer goods, usually have hierarchical structures and have
many departments.

In addition, findings have also highlighted that a company that uses routine
technology would normally have a centralised decision-making structure. This
may be due to the fact that production processes are the same for routine
technology, irrespective of the location. Thus, it is better if decisions are made
centrally. On the other hand, a company that uses non-routine technology would

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normally have a decentralised decision-making structure since only the

departments, branches or subsidiaries, can better understand their own specific

9.4.4 Organisational Environment

The environment of an organisation, which includes its suppliers, customers,
competitors, legal system, workers union and related government agencies,
strongly influences the organisations performance. This is due to the fact that all
these environmental elements are potentially affected by change and are often
subjected to uncertainty. For example, customers needs and wants can change at
any time and an organisation will not know when these changes are going to
occur and the direction of those changes.

1. What is the best structure for the following organisations:

(a) Innovation strategy.

(b) Cost-minimisation strategy.
(c) Imitation strategy.

2. What is the relationship between:

(a) Organisation size and structure.

(b) Organisation environment and structure.


Based on the discussion pertaining to the driving forces that determine

an organisations structure, evaluate the structure of the organisation
that you are working for and discuss whether its structure is in line with
the needs of the organisation.

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We will now look at another important element of organisation, which is culture.
Culture is often talked about in relation to society. A societys culture is
manifested in many ways including mannerisms of speaking, dressing, types of
food and forms of entertainment.

Culture plays an important role in influencing the actions of members of the

society. Nevertheless, it has been realised that organisations too have their own
culture and cultures influence behaviours and actions of members of the
organisation. This ultimately affects the productivity and profitability of the
organisations. Therefore, an understanding of culture and how to promote a
positive culture is essential.

9.5.1 What is Organisational Culture?

Organisational culture can be defined as the following:

Organisational culture is a system of actions, values and beliefs that are

developed in an organisation and shared by all members of the organisation.

Organisational culture acts as a guide to members of an organisation and informs

them of acceptable and unacceptable behaviour. Organisational culture also plays
a role in differentiating one organisation from another. In short, organisational
culture encompasses all practices, traditions, and ways of working in an

9.5.2 Layers of Cultural Analysis

Many aspects of culture are deeply buried in the shared experience of
organisational members. According to Schermohorn, Hunt and Osborn (2008),
this complexity has led some to explore different layers of analysis, ranging from
easily observable to deeply hidden aspects of culture (refer to Figure 9.6).

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Figure 9.6: Layers of cultural analysis

Source: Shermohorn, Hunt & Osborn (2008)

9.5.3 Characteristics of Organisational Culture

Latest studies have identified seven major characteristics that describe
organisational culture. Figure 9.7 expounds these characteristics.

Figure 9.7: Characteristics of organisational culture

Table 9.3 shows the descriptions of the seven characteristics of organisational


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Table 9.3: Characteristics of the Organisational Culture

Characteristic Description

Innovation and Risk This refers to the extent an organisation encourages its
Taking employees to be innovative and to take risks. Organisations
that rank high on this characteristic strongly encourage their
employees to try something new, such as making decisions by
intuition, irrespective of the fact that these organisations are
uncertain of whether the intuitions will be profitable to the

Attention to Detail This refers to the degree to which employees are expected to
give attention to detail in the course of their work.
Organisations characterised this way place a lot of emphasis on
details and expect their employees to conduct detailed analysis
on any decision prior to implementing those decisions.

Outcome Orientation In this characteristic, the management focuses on results rather

than on the techniques and processes. In this instance, the
management believes that if the process is good, the outcome
will be equally good. However, there are also organisations
that concentrate more on the quality of their products and
services rather than on techniques and processes.

People Orientation This refers to the level in which an organisation is concerned

over the effect of its decisions on its employees. A management
that is people-oriented would always obtain the participation
of its employees in the decision-making processes.

Team Orientation This refers to the number of teamwork activities in an

organisation. An organisation ranks high on this characteristic
if it stresses on teamwork.

Aggressiveness This refers to the degree in which members of the organisation

are aggressive and competitive. Organisations which
emphasise on aggressiveness like to encourage their
employees to compete with one another whilst offering merit-
based rewards.

Stability Organisations with this characteristic prefer to maintain its

status quo whilst trying to avoid changes. Organisations such
as this would most probably find it difficult to adapt to changes
occurring around them.

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All the characteristics mentioned exist on a continuum, which means that any
particular organisation can be assessed high or low on any particular

An assessment of the mentioned characteristics reflects the organisational culture

of a company and this assessment helps guide the employees on what are
acceptable and unacceptable behaviours at their respective workplaces.


Based on the seven types of organisational characteristics discussed,

assess the culture of the organisation you are currently working in. Can
you identify the characteristics of your organisation?

9.5.4 Categories of Culture

There are a few ways to categorise culture in an organisation.

(a) A Dominant Culture or a Subculture

Cultures could either be a dominant culture or a subculture. In smaller
organisations, it may have only one dominant culture. A dominant culture
is made up of core values, beliefs and actions that are held or practised by
nearly all members of the organisation.

However, for larger organisations, we may, at times, find subcultures as

well. Subcultures refer to the culture that is practised by only a small
portion of people in the organisation.

A subculture is made up of unique values or philosophy that is not

consistent with the dominant values and philosophy of the organisation.
Subcultures normally develop as a result of, for example,
departmentalisation or differences in locations of the organisation.

(b) A Strong or a Weak Culture

Culture can also be categorised as strong or weak. A strong culture is a
culture that is widely and intensely practised by a majority of members in
an organisation.

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The culture of an organisation will be strong if more individuals accept it

and show strong commitment to its core values. A strong culture is able to
unite members of an organisation by increasing cohesion, loyalty and
commitment to the organisation.

However, the effect of a strong culture is not always a positive one.

Sometimes a strong culture can encourage the wrong values and cause
harm to the organisation and its members. At times, company operations
fail largely because of a strong culture that supported pushing everything
to the limits. This could be seen with respect to business practices, rules,
personal behaviour and laws. Executives would drive expensive cars;
management celebrate big deals involving money at formal occasions, and
etc. Thus, a strong culture increases employee cohesion and commitment to
the values, goals, and strategies of the organisation, but companies can
sometimes have unethical values that are unhealthy for the organisation
because they dont fit with the needs of the environment. Research at
Harvard found that a strong culture does not ensure success unless it also
encourages a healthy adaptation to the external environment. According to
Kotter and Heskett (1992) a strong culture that does not encourage
adaptation can be more damaging to an organisation than a weak culture.


What are the differences between a dominant culture and a subculture

in an organisation? What are the differences between a strong and a
weak culture?

9.5.5 Understanding Other Categories of Cultures

Organisational culture can be based on the following four categories (refer to
Figure 9.8):

Figure 9.8: Categories of culture

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Table 9.4 shows the explanations of these categories of culture.

Table 9.4: Four Categories of Culture

Category Explanation
Adaptability This culture is characterised by strategic leaders encouraging values
Culture that support the organisations ability to interpret and translate
signals from the environment into new behavioural responses. In
this context, employees have autonomy to make decisions and act
freely to meet new needs; and responsiveness to customers is highly
valued. For example, leaders encourage experimentation and risk-
taking as an everyday way of life.

Achievement An achievement culture is characterised by a clear vision of the

Culture organisations goals, and leaders focus on the achievement of
specific targets such as sales growth, profitability, or market share.
This is associated with a resultoriented culture that values
competitiveness, aggressiveness, personal initiative, and the
willingness to work long and hard to achieve results.

Clan Culture This culture has an internal focus on the involvement and
participation of employees to meet changing expectations from the
external environment. Companies with a clan culture are generally
friendly to work with, and employees may seem almost like a
family. The leaders emphasis on cooperation and consideration of
both employees and customers can avoid status differences.

Bureaucratic The bureaucratic culture has an internal focus and consistency

Culture orientation for a stable environment. The culture supports a rational
and orderly way of doing business. Following the rules and being
thrifty are valued. The organisation will normally succeed by being
highly integrated and efficient.

An organisation may have culture values that fall into more than one category,
or even into all categories. However, according to Daft (2008), successful
organisations with strong cultures will lean more toward one particular culture

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9.5.6 Functions of Culture

According to Robbins (2008), culture plays an important role in an organisation.
The functions of a culture are depicted in Figure 9.9.

Figure 9.9: Functions of culture

Table 9.5 shows the explanations of these functions.

Table 9.5: Functions of Culture

Function Explanation

Defining An organisational culture differentiates one organisation from

Boundaries another. This is due to the fact that each organisation has its own
culture that is practised by its members.

Providing Culture also provides members of an organisation with an identity

Identity that they can call their own. For example, a culture that encourages
employees to come up with something new will promote creativity
and innovation, in addition to making employees feel that they stand
apart from employees of other organisations because of the values
that they hold.

Generating Organisational culture that consists of specific values can increase

Commitment commitment among members. For instance, when an organisation
makes employee welfare an important agenda, this will lead to the
provision of various benefits like medical insurance, scholarship and

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Enhances the The stability of an organisations social system is reflected in the

Stability of an degree to which the work environment is considered positive and
Organisations conducive for optimum performance in addition to how well conflicts
Social System and changes are handled. This is due to the fact that organisational
culture provides a standard for the kinds of permissible actions that
can be implemented whilst handling all sorts of problems.

Social stability can result in a positive working environment, in which

problems and conflicts are amicably overcome.

Serves as a Culture can influence an employees behaviour and attitude because

Control it determines what is acceptable and unacceptable in terms of
Mechanism behaviour and actions. In addition, a strong culture would provide
that Guides employees with a single direction and/or guidelines on what to do.
Employees In fact, an employee-organisation fit which is reflected in employee
Behaviour and behaviour and organisational culture compatibility, strongly
Attitude influences decisions on who to employ, who is appraised as a high
performer and who is promoted.

In conclusion, the functions discussed above play an important role in an

organisation because culture can increase an employees commitment to the
organisation whilst ensuring consistency of the employees behaviour. In
addition, culture is also important to employees as it reduces ambiguity in an
organisation by providing guidelines on what to do.


List all the five functions of culture in an organisation. Can you think of
other functions apart from those proposed by Robbins?

9.5.7 Culture as a Liability

The functions that were discussed earlier reflect the importance of culture to an
organisation and the individuals working in it.

However, culture can also be detrimental to the effectiveness of an organisation,

especially if it is a strong one. Figure 9.10 depicts how culture can adversely
affect an organisation.

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Figure 9.10: Negative effects of culture

The explanations of the barriers that affect culture are as follows:

(a) Barriers to Change

Organisational culture especially a strong one can be a barrier to change if
the values held are not in agreement with those that will contribute to the
effectiveness of an organisation.

Consistent behaviour is beneficial to an organisation in a stable environment

but todays business environment has gone through many changes. In this
situation, a strong organisational culture will prevent the organisation from
effectively handling change.

(b) Barriers to Diversity

Organisational culture often influences decisions made pertaining to the
employment of individuals. This is done to ensure compatibility between
individuals and an organisation. A strong culture also exerts pressure on
employees to conform to the values subscribed by the organisation.

As a result, all employees of an organisation share the same values and

beliefs, thus denying the organisation with the benefits that come from a
diverse workforce.

(c) Barriers to Acquisitions and Mergers

Of late, many acquisitions and mergers have taken place in business. The
clash of two opposing cultures that can potentially lead to failure is a
challenge faced by acquisitions and mergers. This leads to distrust among
employees of both organisations in addition to the feeling of cultural
superiority on the part of both parties accompanied by their respective
difficulty in accepting the ways of the other party.

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How does culture have a positive or negative effect on an employees

productivity in an organisation? Discuss with your classmates.

9.5.8 Creating and Sustaining Culture

Culture is a self-formed entity. The culture of an organisation is formed over a
long period of time. The process usually involves a variety of work and decision-
making as well as an organisations success at implementing those processes.

Founders and leaders of organisations often play an important role in the creation
of an organisations culture since the mission and vision of these founders and
leaders are an employees source of reference in most organisations. Normally, the
practices and ideology instilled by the founders of organisations are practised for a
long period of time.

Once an organisations culture is in place, there are many practices within the
organisation that act to maintain the culture, either deliberately or accidentally.
For instance, many human resource practices help sustain an organisational
culture via the selection of employees, performance appraisal and administering
of compensation.

There are three forces that play an important role in sustaining the culture of an
organisation, namely:

(a) Employee Selection Process

The goal of the employee selection process is to identify and hire
individuals who have knowledge, skills, and abilities to successfully
perform the jobs within an organisation.

However, in view of the fact that more often than not, there is more than
one candidate who has all these characteristics, selection will be influenced
by the compatibility factor between individuals and an organisation. Those
who share similar values with an organisation have a greater chance of
being hired. This is done to ensure that selected individuals will not have
problems adapting to an organisation and will be able to enhance their
productivity level in a short period of time.

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(b) Actions of Top Management

The actions taken by the top management often receive the attention of
every member of the organisation. Generally, the employees will regard
everything that is said and done by the top management as the norm. This
especially pertains to high-risk issues, subordinates degree of freedom in
decision-making, and appropriate dress code, etc.

Consequently, top management plays an important role in sustaining

culture. In fact, an influential leader can change or introduce a new culture
to an organisation if he/she deems it to be necessary.

(c) Socialisation Methods

An employee who is fairly new in an organisation would normally feel
uncomfortable or out of place in his/her new workplace due to his/her
unfamiliarity with the organisation and its culture. Therefore, socialisation, a
process where the individual adapts himself to the new environment, is an
important process at the time of an individuals entry into the organisation. It
ensures that the individual can easily adapt and successfully perform
his/her job.

The socialisation process can be seen as consisting of three stages: pre-

arrival, encounter and metamorphosis. These are depicted in Figure 9.11.

Figure 9.11: The socialisation model

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

We will now take a closer look at the three stages in the socialisation

(i) At the pre-arrival stage, individuals who wish to work at the

organisation would normally try to obtain as much information as
possible about the organisation. He/She may try to get his hands on
reading materials about the organisation or meet up with friends who
have worked or are currently working with the organisation.

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(ii) During the selection and recruitment process, the organisation will try
its best to obtain the right individuals who can assist it (the
organisation) to meet its goals since each individual has his/her own
values, attitudes, beliefs and expectations of the job that may differ
from those of the organisations. Therefore, this stage determines who
gets in and who is left out.

(iii) The encounter stage occurs when an individual starts working in an

organisation. During this period, he/she will get a clearer picture of
the organisation and sometimes, the picture which he/she derives
will go against his/her expectations.

(iv) Finally, a new employee will have to go through a socialisation

process to detach him from his previous assumptions and replace
them with another set that is deemed desirable by an organisation. In
cases where there is an extreme clash of values, there is a possibility
that the employee cannot come to terms with the said
incompatibilities and may opt to leave the job.

(v) On the contrary, employees who decide to stay with an organisation

will have to sort the problems brought about by the differences at the
encounter stage. This means that new employees have to be prepared
to make changes especially in terms of values and attitudes in order to
adapt to the organisation. This stage in the process is called

(vi) The socialisation process can either happen informally or through

specific organisational programmes that facilitate an individuals
adaptation to the organisation. The socialisation process is considered
successful when new members are comfortable with the organisation
and their job. In addition, new members would, by now, accept the
norms of the organisation and those of their work groups whilst
gaining confidence of their acceptance by their colleagues into the
organisation and work group. They are also gaining competence to do
the job well.


Explain how the three factors discussed above, i.e. employee selection
process, actions of top management, and socialisation, can assist in
maintaining the culture of an organisation.

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9.5.9 Learning a Culture

Lastly, there are a variety of ways in which individuals can learn the culture of
an organisation. Studies have shown that there are four effective ways of
transmitting culture:

(a) Stories
An easy way to teach values in a culture is through stories. This is because
people love stories especially stories pertaining to the success of an
individual or groups. Stories such as this often make their way into
orientation programmes since they serve as excellent lessons to new
employees, i.e. stories about the founder of an organisation and his
struggles to build the organisation. Culture is also transmitted via stories
pertaining to the successes of an organisation in winning various types of
awards from the government or other authorities.

(b) Rituals
There are specific activities and/or rituals that are conducted in an
organisation to convey the values to be instilled, major goals to be achieved
and the desired type of employee. Some of these activities and/or rituals
are Quality Day, which impresses on the employees the importance of
quality, and Exemplary Award Day, which convey an organisations
appreciation towards employees who perform well in their respective

(c) Material Symbols

Organisational culture can also be transmitted through its dress code, the
layout of an office, and benefits provided. For example, an organisation
that stresses on a formal dress code may want to convey to its employees
on the need to have all its activities conducted in a formal manner, even
when it concerns reprimanding processes. In the meantime, an organisation
that has an open concept for its office layout may want to instil the feelings
of equality, open communication, creativity and flexibility.

(d) Language
Many organisations as well as certain units within an organisation use
language to differentiate members of a particular culture or subculture. By
learning and using that language, members attest to their acceptance of the
organisation or units culture. For instance, the use of terms like JD (job
description) and KSA (knowledge, skills and abilities) by human resource
practitioners might not be understood by individuals outside of the
department although these are common terms used daily in the human
resource department.

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Briefly discuss how a newly recruited employee can learn about the
culture of an organisation that he/she has just joined.


Choose the correct answer.

1. Which of the following factors relate to organisational structure?

A. Centralisation
B. Spans of control
C. Departmentalisation
D. All of the above answers

2. Each of the following factors plays an important role in

organisational structure EXCEPT:
A. Strategy
B. Technology
C. Company size
D. Workforce diversity

3. Which of the statements below explains the mechanistic model of

A. Narrow span of control
B. High degree of formalisation
C. Comprehensive information network
D. Limited participation by low-level members

4. Which of the following statements is false regarding organisational

A. Organisational culture represents shared values that
influence behaviour.
B. One of the characteristics of organisational culture is
innovation and risk taking.
C. A subculture is made up of unique values that are consistent
with the dominant values of an organisational.
D. Organisational culture could influence and affect the
productivity and profitability of the organisation.

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5. The following practices can help transmit organisational culture

A. An organisation that stresses on a formal dress code.
B. Culture can be transmitted via stories of success of an
C. Some specific activities can be conducted in an organisation
such as Quality Day and Exemplary Award Day.
D. The organisation is divided into various departments.

It is clear that an organisational structure has significant effects on its

members and behaviour of its members since it answers various questions
that can influence employee performance, i.e., What are my work related
responsibilities? How should the work be done? and To whom should I
report the results of my work?

The answers to questions such as these will shape the attitude and behaviour
of employees and will be able to motivate them to increase their performance.

It has to be cautioned that strategy, size, technology and the environment of

organisation can also influence the formation of an organisations structure.

There are three common organisational structures simple structure (usually

practised by small businesses), bureaucracy structure (based on
standardisation) and matrix structure (a dual-authority that combines
function and product-based departmentalisation).

Despite the fact that two organisations are physically the same and produce
the same products, these organisations do not necessarily have the same
organisational structure.

An organisation does not necessarily have to use the same organisational

structure throughout its life span.

The culture of an organisation could affect its productivity and profitability.

This is due to the fact that organisational culture influences employee
perception of these seven aspects: level of emphasis placed on innovation
and risk taking, attention to detail, product orientation, employee
orientation, team orientation, degree of aggressiveness, and stability.

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There are three layers of cultural analysis observable culture, shared

values and common assumptions.

There are five functions of culture defining boundaries, providing

identity, generating commitment, enhancing the stability of an
organisations social system and serving as a control mechanism that guides
employees behaviour and attitude.

If an organisations culture is positively perceived it will lead to a positive

effect on an employees performance and satisfaction.

An individual who has similar values and beliefs with his/her organisation
would normally have a positive perception of the organisations culture.

Hiring an individual or individuals with contrary values and beliefs with

those of an organisation will leave a negative impact on the organisation
because these individuals will lose their motivation and commitment and
will most probably leave the organisation.

Categories of culture Organic model

Chain of command Span of control
Cultural analysis Subculture
Job specialisation Unity-of-command
Mechanistic model Virtual organisation

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Topic Power, Politics
and Conflicts
By the end of this topic, you should be able to:
1. Define power, dependence and tactics of power;
2. Discuss the contributing factors to political behaviour;
3. Differentiate between the traditional, human relations and
interactionist perspectives; and
4. Evaluate two techniques that can minimise conflicts in organisations.

As we already know, a group consists of two or more individuals who interact
with each other in a particular scope, whether formal or informal. Naturally,
when a group interacts with each other, there exists various social phenomena,
where power and politics are also included.

Power can exist in various and different situations. Power can exist in different
types of individuals whether the person is aware of it or not.

Think of yourself for a moment. What is your position in your family? If you are
a husband, you may control your wife and if you were to have children, you may
control your whole family.

Vice versa, if you are a wife, you will be more powerful than the rest of your
family members in controlling the daily household matters. If you are an elder
brother or sister to your younger siblings, you will have more status than them.

The situations depicted above show that you have power over other individuals.
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Actually, your position and what you have enables you to influence others to
follow your wishes.

In a formal organisation, power is not only needed but is also an important

element to ensure organisational members fulfil the responsibilities needed in
order to achieve the organisational objectives. The existence of power in
organisations, whether on purpose or not, depends on the position and
individual characteristics of the person who gained the power.

This topic explains in more detail the definition of power, as well as the
dependence and tactics of power. Besides that, we will also discuss the meaning
of political behaviour and how it exists in an organisation.


Before we go on further, let us look at the definition of power.

Power refers to a phenomenon that enables an individual to influence or force

others to follow his/her individual wishes or requests.

There are two principles from the general definition that can be put forward:

(a) The influential individual or the one exerting influence; and

(b) The influenced individual or the person who is being influenced.

In this matter, the individual who influences (identified as A) definitely has

power. Whereas individual or individuals who are influenced (B, C, D) are those
who lack or are without power, unlike A, who is with power. If B, C and D are
influenced and follow the directions or wishes that A gives, this means A has
power over them.

Why is power important in an organisation? As we already know, organisations

are created to achieve certain objectives. For that purpose, human resources need
to be combined synergistically. This will only happen if there is power that can
ensure human resources are used optimally.

Powers that are created will enable individuals (power holders) to perform tasks
for the good of the organisation, such as taking disciplinary actions, giving
rewards, implementing change, making decisions and resolving conflicts.

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Based on this explanation, we can say that power brings good to the organisation.
However, some people see power from a negative perspective. In this context,
power is seen as a negative force since it can always be abused.

In organisations, power can be abused by individuals for their self-interests. This

is evident in instances such as financial mismanagement, bringing down other
people whom they do not like, nepotism, or spreading influence and power

In this aspect, it can be concluded that power does not only bring good, but at
the same time can also bring misfortune to organisations. Nevertheless, power is
still being needed. More importantly, the higher management should ensure that
negative power is not allowed to be a dominant force in an organisation if they
cannot eradicate it totally.

Now that we understand power, the question is can the power held by an
individual influence other people to follow his or her wishes? Actually, there is a
factor known as dependence that determines the degree of power an individual
has on others.

To further clarify the dependence concept, let us refer to A, B, C and D, the

individuals mentioned earlier. Why did B, C and D follow As instructions?

Their obedience is because they depend on A for something special (either

physical or spiritual), which they do not have. That is why, because of fear or
favour, they follow As instructions in the hope that they get the benefits from
the something special that A has.

With regard to this, recall again what was mentioned much earlier. For example,
in the situation of your position as head of the family; your wife and children
obey your wishes and instructions because there is something in you. Maybe you
are the source of your familys income, the so-called bread-winner, or you are
more matured and more knowledgeable.

Another example is if you have money and you ask a person to do some work
for you; the person will easily follow your wishes. This is because he or she
hopes for financial rewards, which is important to him or her. Therefore, the
person is depending on you and you are more powerful compared to him.

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A very important point that you must know about dependence is that, the more
dependent a person is on you, the more power you have over that person. And
the opposite is also true, if a person depends less on you, or does not depend on
you at all because the person does not benefit from what you have, then the level
of power that you have on him or her will be low or none at all.

Another example, if an employee from the marketing department in Company A

is really hoping to get a promotion, then he will abide by the personnel
manager's wishes who has the power to promote him. When the employee
already gets what he wants, his dependence on the personnel manager

The same employee will transfer his dependence to another manager, for
example, the finance manager, if he is expecting an approval for his car loan,
since the finance manager has the power to approve his car loan.

However, his compliance to the marketing manager, who is his direct supervisor
will continue. In this relationship, his dependence on the marketing manager is
consistent because he has a consistent interest as long as the marketing manager
is responsible for that department.


Besides what is explained above, are there any more factors that you can
think of that can create situations where an individual or group is
dependent on another individual or another group?

You may still remember the basic sources of power in Topic 7, where power is
dependent on sources such as individual personal characteristics, individual
expertise, formal position (designation/role), reward and coercion.

The sources mentioned above can create or increase power for an individual or a
leader. The explanation is as shown in Table 10.1.

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Table 10.1: Dependence and Sources of Power

Examples of Situations that Create Examples of Situations that Do

Sources of Power or Increase Individual or Group Not Have or Lower Individual
Dependence or Group Dependence

Personal A politician who is needed to That politician is not needed

Characteristics of an advise on a community project. by the members of different
individual (Referent ideological or political groups..

Individual Expertise Expertise or knowledge of a The attendance of that chemist

(Expert Power) chemist is important in the in a walk-out or picket is not
Research and Development of a needed because it will not
chemical manufacturing company. solve the demand for salary

(Note: the sources of power based on position designations, reward and punishment are not
included in the above table because all three are related and have been explained in previous


So far, we have discussed how an individuals dependence on another individual
who has a certain power, exists. However, even for a person who has the power,
it is not easy for him or her to influence other people. This is because at times, his
effort is resisted by the people whom he wants to influence. In this matter, tactics
are used by the individual to influence others so that he or she can influence
them to strengthen his or her power from time to time. In an organisation, this is
called power tactics.

According to Kipnis et al. as cited by Robbins (2008), based on a research on 165

managers, there were seven tactical dimensions or strategies used by them to
influence others (superiors, co workers, subordinates).


Based on the sources of power that you have learnt in Topic 7, provide
two examples of situations where there exist an individuals
dependence on his or her supervisor.

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Table 10.2 explains the seven dimensions of power tactics.

Table 10.2: The of Seven Dimensions of Power Tactics

Dimension Tactic

Reasons and Rationale This tactic uses facts and data so that ideas and proposals can
be seen as logical and rational.

Friendship This tactic is more diplomatic and suitable where individuals

create friendships and camaraderie; act with good gestures
and words; and are humble and polite in the process of
influencing others.

Bargaining This tactic is used through negotiations, with the goal of

either to win over the person he or she wishes to influence or
to have a win-win situation with the person.

Force or coercion Using this approach involves elements such as coercion, that
is, the people to be influenced are forced to do something, for
example, a task, which is then then followed by a few related
reminders (usually with a deadline to finish the task).

Individuals who use this tactic will usually get the person
they want to influence, to refer to the organisations rules to
do the requested task.

Reward and This tactic uses reward and punishment or sanctions already
Punishment or Sanction existing in the organisation, to influence others, such as salary
increment, position or grade, recommendation letter and
others. Those who disobey will get a lower appraisal, no/less
salary increment, or transferred to a less desirable location.

Higher Authority Through this tactic, individuals refer to a higher authority to

get support in his or her effort to influence or force others to
fulfil his or her demands.

Coalition This tactic is done to get support from co-workers in the same
or lower level positions in an organisation. In this tactic, the
individual joins other identified co-workers to achieve their

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In your opinion, which are the tactics most suitable to be used in

organisations today? Explain.


You must be familiar with the term politics. The word politics brings to mind the
picture of political parties competing to gain power to rule a country.

Actually, the political phenomenon happening in a country also happens in any

organisation. However, its existence in an organisation needs to be seen from a
different context, that is, from the practices and goals of the people that create a
political situation and those involved in it.

We have learnt about the concept of power in an organisation, especially its

sources and factors that strengthen the degree of dependence. Besides that, we
also know how individuals work hard to gain, maintain, and increase their

These individual efforts can be interpreted as a political behaviour in an

organisation. Therefore, when we talk about organisational behaviour, power
and politics are sources that cannot be separated, and are interdependent. This is
in line with what has been defined by Pfeffer as politics in an organisation (Mc
Kenna,1994), that is, activities performed by individuals to gain, upgrade and use
power and other resources to achieve results in uncertain or ambiguous

However, this explanation is still not sufficient for us to understand the meaning
of political behaviour in organisations. It is insufficient because the meaning
needs to be seen in a broader context than that.

Political behaviour according to Bacharach and Lawler (Hellriegel, et, al. 2008) is
an effort by certain individuals or groups to influence other peoples behaviours
and normal activities in organisations just to fulfil their needs and protect their
own interest, as well as to achieve their own goals.

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As for Farrel and Petersen as cited by Robbins (2008), political behaviour in

organisations is not something formal or specified by organisations in their
employees job specifications. Nevertheless, these informal activities cover efforts
to influence objectives, criteria, and processes used to make decisions in


The question now is, how can these behaviours exist in an organisation
and can its existence benefit the organisation?

What does political behaviour look like in organisations? In other words, what
do people do to engage in political behaviour? A great deal of research has
examined political behaviour which can be seen through various political tactics
used within or by organisations. These tactics include the following:

(a) Rational Persuasion

A rational persuasion involves using logical arguments or factual
information to persuade an individual or group that the persuaders request
will result in beneficial outcomes.

(b) Consultation
A consultation tactic requires getting an individual or group to participate in
the planning or execution of whatever the politician wants accomplished. For
example, a CEO who wants to implement a specific strategy would consult
associates at every relevant organisational level.

In short, political behaviours naturally exist in organisations. There are two

possibilities as to why some organisations do not discourage or eliminate its
existence, and these are:
(a) Maybe it is hard to do so; or
(b) Maybe it is the management that purposely allows it because of its positive
effects on organisations.

A research done by Grands and Murray (Mc Kenna, 1994) on managers in a

number of organisations, showed that half of them see the existence of politics in
organisations from both positive and negative perspectives.

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Negative assumptions arise when they feel that politics in organisations is not
only unjust, but also not good and irrational. On the other hand, under a positive
assumption, they know that politically inclined behaviour is needed to get ahead
in an organisation. In fact, to them, to be a politician is a prerequisite for
success as an employee.

10.4.1 Factors Contributing to Political Behaviours

While we understand that politics is not created by organisations, in truth, the
existence of politics accidentally starts from the organisations own environment.
How then does the organisations internal environment nurture political
behaviour among its members?

This can only be answered if we take a view from the aspect of the organisational
culture. An organisations culture that is inclined to competition could cause its
members to be involved in politics. This can be seen from the trust an individual
has in another individual. The lower the level of trust amongst themselves, the
higher would be the potential for political behaviour.

Besides that, from the perspective of management practices (which are also
related to organisational culture), there are practices which purposely or
accidentally encourage members to compete. For example, limited promotional
opportunities will force qualified members to compete with each other so that
the best will be chosen. While doing this, their actions will typically involve
political manoeuvres.

Similar actions may also happen in other management practices such as:
(a) Giving excellent service award based on certain predetermined quotas;
(b) Job assignments that encourage individuals to compete for example for
light work loads, low risk tasks, and convenient locations close to ones
own residence; and
(c) Job scheduling that forces individuals to do things so that they will be
selected to work at suitable times (usually employees avoid working at

An employee performance evaluation system is another management practice

that can contribute to the existence of political behaviour. Even though the
system was not meant to punish or reward the person evaluated, still in reality
management always refers to those appraisal results/reports to determine salary
increment, excellence awards and so on. This is the reason why politics plays its
role because individuals will make an effort to influence the evaluator in order to
be appraised favourably.

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Even though organisational culture is said to contribute to organisational

behaviour, an organisational culture cannot exist without the roles played by the
members of that organisation. In other words, certain personalities contribute to
the existence of political behaviour in an organisation.

These personalities are mentioned in Figure 10.1.

Figure 10.1: Personalities of individuals that contribute

to political behaviour in organisations

Table 10.3 gives further explanation for the personalities of individuals that
contribute to political behaviour in an organisation.

Table 10.3: Personalities of Individuals that Contribute

to Political Behaviour in Organisations

Personality Explanation

High Self Control Such a personality is sensitive to the environment and

can adapt to changes in the environment. Thus, he or she
has the potential to be involved in politics.

High Self Respect A personality that has self respect usually is highly
motivated and a risk taker. Thus, risk and courage leads
him or her to compete and be political.

Internal Locus of Control A personality that believes no outside factors can control
fate or destiny, except the individual himself. Thus, the
tendency to be political is high.

Machiavellianism A personality who finds it easy to be political because it

is often linked to efforts to manipulate others in every
way (including immoral ways such as misinformation)
just to achieve his or her goals and interest.

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Choose two organisational factors and two individual factors. Explain

further and provide examples on how these factors could contribute to
the existence of political behaviours in an organisation.


Next, we will discuss the conflict concept. Conflict could be a serious problem in
any organisation. Although it may not lead to organisational destruction, it can
affect organisational performance, and may lead to the loss of good employees.

Nevertheless, not all conflicts will bring problems to an organisation. Conflicts

can also bring positive effects. In this section, we will discuss conflict in depth
and you should be able to understand how a conflict begins.

10.5.1 Definition of Conflict

Generally, there are various definitions of conflict. Nevertheless, conflict can be
defined as:

The process where one party (A) sees that its interests are being opposed or
taken over by another party (B), and this has negatively affected or will be
negatively affecting it and thus not consistent with what it desires.

(Robbins, 2008; Greenberg, 1999; McShane dan Von Glinow, 2006)

This definition is very broad and it explains when these conflict of interest,
objectives and perception, will arise. It also covers all types of conflict faced by
individuals in any organisation, such as differences in goals, conflict in defining
facts and disagreement in business ideas.

10.5.2 Levels of Conflicts

Conflict happens almost anywhere, and one of the ways to classify conflict is
through the following levels. There are four levels of conflicts that can be
identified, as shown in Figure 10.2.

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Figure 10.2: Levels of conflict

Table 10.4 explains the four levels of conflict in an organisation.

Table 10.4: Four Levels of Conflict in an Organisation

Levels Explanation

Intrapersonal At this level, conflicts happen to an individual. Sources of conflicts include

Conflict ideas, emotions, thinking, attitude and others. There are three types of intra
personal conflicts:

(i) Approach Approach Conflicts

This happens when we are attracted to two or more choices, but can
choose only one. For example, a student can choose only one
university to study in, either to go to UUM or OUM.

(ii) Avoidance Avoidance Conflicts

This happens when we try to avoid two or more choices that we do
not want, but we must choose one of them. Example, a patient tries to
avoid being operated or given an injection, but he must choose one of
two in order to cure his illness.

(iii) Approach Avoidance Conflict

This happens when we are considering one choice that attracts our
attention and at the same time it has something that we do not like.
For example, you choose to work in KL because there are many job
opportunities but you have to suffer because of the high cost of living.

Interpersonal This second level of conflict happens between two or more individuals. This
Conflict type of conflict includes misunderstandings between employer and
employees, husband and wife, relatives, roommates and others.

Intragroup This level of conflict exists in a small group among team members or work
Conflict teams and also in a family, class etc. This type of conflict influences a teams
ability to solve the conflict and to reach its goals effectively.

Intergroup This type of conflict exists between members of different groups, such as
Conflict between unions, organisations and organisational management teams,
political party groups or departments in an organisation. At this stage,
conflict is very critical because it involves a big group of people and very
good negotiation must be used to overcome this stage of conflict.

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According to Robbins (2008) there are three types of conflict perspectives, for
example: traditional, human relations, and Interactionists. The next subtopic
provides a detailed explanation on each of these perspectives.

10.6.1 Traditional View

According to this perspective, conflict is seen as something bad and is related to
certain terms such as violence, destruction and irrationality, which strengthen
the negative connotation.

Conflicts, according to this perspectives definition, are bad and negative and
must be avoided. This perspective is consistent with the attitude shown by group
behaviour in the 1930s and 1940s where conflict happens because of a lack of
communication and trust between people and failure of the management to fulfil
employees needs and ambitions.

This perspective offers one simple approach that wants us to focus on human
behaviour which causes conflicts, identity sources of conflict and then correcting
them in order to increase group and organisational performance.

Although present researches show strong evidence questioning the ability of this
approach to reduce conflict, many of us still evaluate a situational conflict using
this old approach.

10.6.2 Human Relations View

According to this perspective, conflict is natural and cannot be avoided in any
group. Besides that, it doesnt bring any negative effect, and in fact it gives a
positive drive that ensures group and organisational performance.

As conflict is unavoidable, this perspective accepts its existence and even

assumes that it may bring good effects on group performance. This perspective
pioneered and influenced conflict theory from the late 1940s till the mid 1970s.

10.6.3 Interactionist View

This perspective explains that conflict is not only a positive drive that must exist
in a group, but is also needed to ensure the effectiveness of a task that is done. If
the human relations perspective can accept the reality of conflict, this approach
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encourages conflict on the basis that a group which is harmonious, peaceful,

calm and cooperative is more inclined to be static, apathetic and fail to react and
take action when faced with changes and innovation.

Therefore, the most important contribution of this approach is that it encourages

leaders to maintain conflicts at a minimum level so that the group and
organisation will become progressive, energetic and creative.


1. Define the concept of conflict that you have learnt.

2. Differentiate between traditional human relation and interactionist



It cannot be denied that some conflicts that happen can precipitate the drive for
innovation, creativity and adaptation in groups and organisations. Besides that,
conflict can also stimulate the employees work spirit and assist in the decision-
making process.

A conflict which supports and increases the objective achievement of a group

or organisation is known as a functional conflict or constructive conflict.

This conflict, when in the form of planned competition will encourage employees
to work harder and increase productivity, thus leading to a sense of satisfaction.

A conflict which deters or lowers a group or organisations performance

achievement is referred to as dysfunctional conflict or destructive conflict.

If this type of conflict happens, it will lead to lower working spirit, dissatisfaction,
increase in rate of absenteeism and as a result, productivity will be affected.

For example, a situation which affects productivity can be caused by an individual

who lost in a competition and will feel discouraged, then followed by mistrust and
ends up focusing only on his or her interests rather than working as a group or team.

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Besides that, a dysfunction conflict can also cause workplace aggression.

Workplace aggression refers to actions taken by an individual with the

intention to hurt or injure others in the organisation, such as sabotaging work,
stealing organisational properties, and taking legal action against the

A conflict that arises in a group at a workplace can be functional or dysfunctional

depending on the types of conflict, the job characteristics performed and group

Therefore, an effective manager will try to manage any dysfunctional conflict by

suppressing it and at the same time, learn how to create functional conflict, which
is beneficial. He can introduce and apply certain techniques to overcome the
dysfunctional conflict, then change it into a productive force in the organisation.

Table 10.5 shows other types of conflict that may occur in the workplace.

Table 10.5: Other Types of Conflict that Occur in the Workplace

Type Explanation
Relationship This refers to a conflict that arises out of personal differences between
conflict people that have different goals, values, personalities, or the like.
Individuals involved in relationship conflicts often report disliking one
another, make fun of one another, are angry or have problems with
other personalities. Relationship conflict is likely to result in poor
performance. It creates distrust, misunderstanding, and suspicion.
Task conflict This type of conflict occurs over work content and goals. An example
is the idea to reduce costs between the marketing and finance
departments in an organisation. Each of the departments may have a
different understanding pertaining to costs and expenses. Their
orientation may be different between one another. Task conflicts do
not have to result in poor performance if managed correctly. Moderate
levels of task conflict have actually been shown to increase
Process conflict This type of conflict concerns responsibilities and how the work
should be completed. For example, process conflict occurs when
students working together on a project disagree about who will work
on which parts of the project or whether they should meet face to face
or communicate by e-mail. Process conflict has been found to
negatively affect performance.

Source: Collela, Miller & Hitt (2006)

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Have you ever faced a conflict happening in your group? If yes, what
was the type of conflict and how did you successfully solve it?


Now, we will take a look at the conflict process. A conflict process covers five
stages as shown in Figure 10.3.

Figure 10.3: Conflict processes

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

10.8.1 Stage I: Potential for Conflict or Incompability

At this stage, a condition exists whereby it creates an opportunity for conflicts to
happen. However, this situation does not necessarily cause a conflict, but is
needed to enable a conflict to happen.

In short, these conditions (which can be seen as causes or sources of conflicts) can
be divided into three categories, namely communication, structure and personal

(a) Communication
One of the main causes of conflict that can happen is poor communication.
Sometimes we feel that we have clearly stated our message, however other
people wrongly interpret the message.

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Therefore, if we can communicate well with each other, then we can

eliminate any misunderstandings and differences that may arise. However,
poor communication is not the only source of conflict although a lot of
evidence shows that communication problems hinder cooperation among
groups because of misunderstandings.

According to research, semantic problems, inadequate information exchange

and disturbance in the communication channel are communication barriers
and potential factors that may start conflicts.

Semantic is how words or terms are meant and translated. The possibility
of misinterpretation of the meaning of words can create a conflict.
Therefore, according to Hellriegel et. al (2008) semantic problems happen
because of differences of meaning attributed by a person on a word.

Previous research show that conflicts are likely to happen when there is too
much or too little communication. Lots of communication will lead to over
communication. Therefore, too much or too little information in a
communication can lead to failure in communication.

(b) Structure
Conflicts may arise due to structures of the organisation such as size,
specialisations, job responsibility and goals. Conflicts may occur between
departments or individuals in the organisation. An individual who holds a
high position may have disagreements with people at the lower level of
employment because of communication problems. The more levels that
exist in an organisation, the more a conflict is likely to happen because the
content of the messages sent becomes less clear and vague. There are three
types of structural conflicts, i.e. vertical, horizontal and diagonal conflict
(refer to Figure 10.4).

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Figure 10.4: Types of structural conflict

Source: Gordon (2001)

(c) Personal Variable

Individuals have different characteristics and personalities. Thus, conflicts
may arise when two individuals with different characteristics and
personalities, such as type A or type B personalities, work together in a

Besides that, differences in values may also cause some conflict especially
in multinational companies. This phenomenon is caused by employees who
come from various cultures, norms, ethnic backgrounds and values.
Therefore, it is important for everyone in the organisation to understand
personal variables in order to avoid conflicts.

10.8.2 Stage II: Cognition and Personalisation

If the condition in stage I gave negative effects to something very important to a
group of people in the organisation, then in stage II this will cause conflict or
incompatibility to become a reality. The factors in stage I will only start a conflict
if one or more persons are affected or realise the existence of a conflict.

For a defined conflict, perceptions will lead to the conflict occuring. Therefore,
one or more persons should realise that sources of the conflict exist. However the
perceived conflict does not indicate that it is something personal. For example, X
realises that he does not agree very strongly with Y, but this does not make X
worried or anxious, nor does it affect Xs affection towards Y.

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This condition happens because it is in the conscious level where an individual,

who is emotionally involved will feel worried, afraid, frustrated and detached.
Following this, two things must be noted here:

(a) First, stage II is important because this is the stage where conflict issues
begin to be defined. Thus, an individual can identify the sources of conflict
and as a result, find ways to solve it.

(b) Second, emotions play an important role in forming perceptions. For

example, a negative emotion is found to be a factor leading to decreased
trust and a negative interpretation on other peoples behaviours. On the
other hand, positive feelings are a factor in increasing the tendency to see
relationships among the problem elements, giving a much broader view on
the situation, and also using innovative solutions.

10.8.3 Stage III: Intention

Intention is in between perception, emotion and behaviour. Intention is the
decision to act in given ways and methods. We must know other peoples
intention so that we can act accordingly on any difference of opinion.

There are five dimensions of intention to handle conflicts as depicted in Figure


Figure 10.5: Dimensions of intention to handle conflict

Source: K. Thomas Conflict and Negotiation Process in Organisation
in M.D. Dunnette and L.M. Hough, 1992

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The five dimensions of intention to control conflict are explained below:

(a) Competing
An individual who uses this dimension tries to fulfil their self-interest. The
individual is not ready to fulfil other peoples interest, even at a minimal
level. This dimension is very effective especially in emergency situations;
issues which require unpopular actions; or with individuals at a higher

(b) Collaborating
This dimension stresses on maximum satisfaction for both parties. A
successful co-operation includes looking at conflict as something natural,
displaying trust and honesty towards each other and encouraging
individuals to express themselves.

Thus, it would solve conflict problems by outlining the differences that

exist rather than concentrating on the different views put forward.
According to Schermerhorn et. al. (2007), this is also known as a win-win

(c) Compromising
Compromising is a behaviour between both elements of steadfastness and
cooperation. It includes assertive sharing and positive cooperation but in a
not too obvious way. Therefore, in compromised situations, no parties will
win or lose. Usually, the result will not satisfy the conflicting parties.

(d) Avoiding
An individual or group may retreat or avoid getting involved in conflicts
and as such, not one of them is able to achieve satisfaction or fulfil their
personal interests. This dimension is extremely effective in a situation
where an individual or group is faced with a small problem, is swayed
from the original goal, or possesses only a small chance to achieve
individual interests.

(e) Accommodating
An individual or group in this dimension will show willingness to
cooperate in satisfying other parties interests and at the same time act non-
assertively in meeting his own needs and goals.

Conflicting parties try to push aside differences that exist and emphasise
the similarities and understanding achieved between both parties. This
condition creates a calm, stable situation, thus making everyone happy.

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10.8.4 Stage IV: Behaviour

At this stage, behaviour is assumed as elements that can be noticed. This stage
includes expression, action and reaction by the conflicting parties. This
behaviour conflict is usually an open attempt to carry out the intentions and
goals of each party. However, behaviour has stimulating qualities that
differentiates it from intentions and goals.

Therefore, it is better if this stage is seen as a process of dynamic interactions.

Figure 10.6 shows how conflict behaviour occurs.

Figure 10.6: Conflict progression continuity

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

Figure 10.6 shows that all conflicts exist along a continuous scale, where at the
bottom we have conflicts categorised as small conflicts. At the top, which is
continuity from the bottom, is no conflict progressing into destructive conflicts.
For example, a walk-out from a job, riot and war belongs to that type of conflict.

Therefore, it can be said that conflict at the higher part of the scale is always close
to a dysfunctional conflict. On the other hand, functional conflict is limited to the
lower part of the scale.

The question is, how does an individual reduce dysfunctional conflict or increase
the low level conflict? The answer is through conflict management techniques
(Robbins, 2008). Both Tables 10.6 and 10.7 show conflict resolution and
stimulation techniques that can enable managers to control conflicting situations.

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Tables 10. 6 shows the conflict resolution techniques.

Table 10.6: Conflict Resolution Techniques

Conflict Resolution Explanation

Problem Solving Face to face meeting between conflicting sides to identify problems
and solutions through open discussions.
Superordinate Create a common objective that cannot be achieved without
Objectives cooperation from every conflicting party.
Avoidance Pulling away or avoiding from the stress of conflicts.
Smoothing Toning down or lowering differences while at the same time
focusing on a common interest among conflicting parties.
Compromise Each conflicting party forgoes something of value.
Authoritative Management uses formal authority to solve conflict, and then
command presents it to the involving parties.
Change human Use behaviour modification techniques such as communication
variables training to change attitudes and behaviours that create conflicts.
Change structural Change formal organisational structures and communication
variables patterns of the conflicting parties through job redesign, transfer and
creating coordinating positions.

Source: Based on Robbins, S. P., (1974). Managing organisational conflict: A

nontraditional approach. Upper Saddle River, NJ: Prentice Hall

Table 10.7 shows the conflict stimulation techniques.

Table 10.7: Conflict Stimulation Techniques

Technique Explanation
Communication Use forceful messages or threats to increase the level of conflict.

Bring an outsider in Adding employees who have backgrounds, values and attitudes
that are different from the current group.

Restructuring Restructure groups, change rules and regulations, increase

organisation dependence and change the same structure to status quo.

Devils Advocate Appoint a critic who will purposely oppose the majority opinion of
the group.

Source: Based on Robbins, S. P., (1974). Managing organisational conflict: A

nontraditional approach. Upper Saddle River, NJ: Prentice Hall

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From some of the techniques just explained, we find that the intention that
controls conflicts is not unexpected because an individuals intention can change
to logical behaviour under good conditions.


What techniques are used to lower conflicts in an organisation?

10.8.5 Stage V: Effects

Effects of action reaction often occur between conflicting parties. These effects
are most probably the functional type that can increase a group or organisations
performance or the dysfunctional type that can reduce performance.

(a) Effects of Functional Types

Conflict is constructive if it increases decision-making quality; stimulates
creativity and innovation; encourages interest and curiosity among group
members; acts as intermediary where problems can be discussed; releases
stress; and encourages self evaluation and environmental change.

Besides that, evidence shows that conflicts can increase decision-making

quality by considering all suggestions, especially unconventional suggestions
from minority groups.

Conflict is also a good remedy for groupthink. This is because it does not
allow groups to approve decisions passively, based on weak assumptions,
or inadequate considerations on a related decision. A conflict also
challenges the status quo because it leads to the creation of continuous new
ideas, encourages re-evaluation of objectives and group activities and this
increases the possibility that the group reacts to changes around them.

(b) Effects of Dysfunctional Types

Uncontrolled conflicting opinions or misunderstanding can lead to
dissatisfaction, which can lower cohesiveness, thus making the group less

There are various sources of dysfunctional conflicts, for example, weak

communication, or reduced co-operation and cohesiveness in a group.
Treating group objectives as less important can also create conflict and
misunderstanding among group members. Worse still, group functions can

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be stymied by conflicts, and can have the potential to threaten the

continuation or existence of the group.

Creating Functional Conflicts

Common opinion says that creating functional conflict is a hard job especially in
a big organisation. In this regard, organisations are more inclined to give
rewards to the opposing party and punish the conflict avoiders, such as
rewarding employees who are courageous enough to criticise or oppose what is
wrong. Whereas, conflict avoiders are punished because they are yes men,
where they only follow what is said by others without thinking about the
purpose of the proposed ideas or contributing ideas to the group.


Discuss the five stages involved in a conflict process.


Choose the correct answer.

1. Which of the following statements is not true about conflict?

A. Conflict can be either functional or dysfunctional for
organisational effectiveness.
B. Conflict management techniques include avoidance,
smoothing, and authoritative command.
C. Compromise is a conflict solving technique which involves
only one party to forgo something of value.
D. Conflict is the process in which one party perceives their
interests as being opposed or negatively affected by another

2. Individuals can obtain all bases of power which include:

A. Reward power
B. Coercive power
C. Domestic power
D. Legitimate power

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3. Some of the resolution outcomes of a conflict include:

A. Lose-lose
B. Win-lose
C. Compromise
D. All of the above

4. Which of the following statements does not describe political behaviour in

an organisation?
A. Political behaviour is an effort to influence other peoples behaviour.
B. Political behaviour in an organisation is formal or specified in their
employees job specification.
C. Political behaviour could also be contributed by the employee
performance evaluation system.
D. Political behaviour refers to efforts to influence objectives, criteria and
processes used to make decisions in an organisation.

5. All personalities below contribute to political behaviour EXCEPT:

A. High self control
B. High self respect
C. Machiavellianism
D. External locus control

Power, if not abused, can play an important role to bring an organisation

towards achieving its objectives.

It is created on purpose by an individual or organisation to gain influence for

certain interests.

Dependence is where people follow an individual because he wields power

over them.

The degree of power depends on the degree of dependence by an individual

or a group on that power.

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Power tactics are used by an individual to influence others in order to

strengthen his power from time to time.

To influence an individual through power is not as easy as one might think.

That is why power tactics are used to overcome this problem.

Power and politics cannot be separated when we talk about organisational


However, unlike power, politics is not created by the organisation, instead it

is informally raised among the organisational members.

Although politics is usually negatively perceived, however, in certain cases,

it can also have positive effects on the organisation.

There are three types of conflict perspectives traditional perspective views

conflict as something bad and must be avoided, human relations perspective
views conflict as natural and cannot be avoided and interactionist
perspective views conflict as a positive drive to ensure effectiveness.

There are two techniques that can minimise conflicts in organisations -

conflict resolution techniques and conflict stimulation management

Dependence Influenced individual

Influential individual Power tactics

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Topic Organisational
By the end of this topic, you should be able to:
1. Elaborate on the forces of organisational change;
2. Discuss the concept of planned change;
3. Distinguish between the changeable and unchangeable factors in
4. Analyse the obstacles to change;
5. Formulate how to overcome obstacles to change in an organisation;
6. Propose ways to sustain change in an organisation.

The current world is facing various types of changes - technological, economical,
and social. These changes are taking place at a very fast rate. In view of this, it is
imperative for organisations to make rapid accommodation and adjustments for
these changes to enable them to remain competitive in the market place.

Hence, good organisations must have knowledge of related current changes in

the market place, the factors contributing to the changes and the steps to be
undertaken to handle and implement these changes.

In this topic, we will discuss the forces and types of change in the organisation.
We will also discuss the resistance to change and how to overcome these

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Organisations today are faced with a dynamic business environment, which
forces them (organisations) to adopt changes in their quest to have a competitive
business edge. Let us view some of the forces of change.

Figure 11.1 shows the vital environmental elements that drive organisational

Figure 11.1: Elements of forces for change

The explanations of the six elements of forces for change will be discussed next.

11.1.1 Changes in the Workforce

The current Malaysian workforce has undergone and is still undergoing a host of
changes. At present, more women are joining the workforce both in the public
and private sectors - compared to 20 or 30 years ago. In addition, more and more
women are empowered to hold high positions in various organisations.

The Malaysian workforce today also holds high academic qualifications,

rendering them to be less suitable to fill vacancies in the agriculture and
construction sectors. The resulting influx of foreign labour to fill in the various
job vacancies within these sectors and at various levels also influences the
changes that are taking place in organisations within these sectors.

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11.1.2 Changes in Technology

Technological changes have also altered the way in which employees perform
their respective work and tasks. While the usage of computers and robots has
made it easier for people to perform their respective work and tasks, it has also
forced them to increase and improve their technical and computer skills.

As a result, organisations need to make substantial investments in training and

development for their existing manpower or engage new employees with the
required and relevant skills. In addition, the usage of computers and robots has
also resulted in a more flat organisational structure since the need for
supervision has lessened tremendously.

11.1.3 Changes in Competition

Globalisation has brought about a significant amount of changes to the
competition faced by most businesses today, with companies currently operating
in Malaysia facing challenges from local and foreign competitors. For example,
local electronic giants such as Khind, Pensonic and MEC have to simultaneously
contend with facing fierce competition against each other and against foreign
electrical product manufacturers that market and distribute their electrical
products locally. This gives rise to the need for local companies to remain highly
competitive to enable them to be adaptable in competing with all companies in
their respective industry; irrespective of their competitors location (refer to
Figure 11.2).

Figure 11.2: Panasonics campaign is more aggressive compared to Khind

Source: and

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11.1.4 Changes in Social Trends

There are many differences between the present and past generation. For
example, the present generation of women holds multiple responsibilities,
including being mothers, wives as well as a corporate and business figures. In
addition, opportunities to advance in education have made our present society
more skillful and knowledgeable.

Figure 11.3: More women in the workforce holding high positions


The existing commitments placed on women that encourage them to pursue a

higher level of education has also led these women to put marriage plans on hold
resulting in more and more women tying the knot at a later age. This trend, in
which both husband and wife are working, has resulted in the need for more
childcare centers, comprehensive health care plans, and child education

11.1.5 Changes in World Politics

Next, we will look into the changes in world politics. Organisations all over the
world including those in Malaysia are required to make significant adjustments
in line with the changes occurring in the world of politics both locally and at
international levels. For example, the United States War on Terror campaign,
due to the horrific events of September 11, 2001, has to some extent, affected
nations around the world, including Malaysia.

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11.1.6 Changes in Mandated Pressures

Organisations are forced to take on activities similar to those of other organisations
because of outside demands placed on them to do so. These mandated pressures
or requirements may be either formal or informal (refer to Figure 11.4).

Figure 11.4: Mandated pressure

Source: Palmer, Dunford & Akin (2009)


Can you list the elements in the organisational environment that may
cause organisational change?


After going through the force for change, the next thing that you have to know is
the types of change. According to Palmer, Dunford and Akin (2009) a common
distinction in change management literature is between the first-order and
second-order changes (refer to Table 11.1).

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Table 11.1: A Common Distinction in Change Management Literature

First-Order Change Second-Order Change

(Incremental, Continuous Change) (Transformational, Discontinuous Change)

First-order, incremental change may Second-order, discontinuous change is

involve adjustments in systems, processes, transformational, radical and
or structures, but it does not involve fundamentally alters the organisation at
fundamental change in strategies, core its core.
values, or corporate identities.
Second-order change entails not only
First order changes maintain and develop developing but also transforming the
the organisation; they are changes nature of the organisation (e.g. like
designed, almost paradoxically, to downsizing, restructuring and
support organisational continuity and reengineering).
order (e.g. such as changes that involve
adjustment, modification, enhancing the The second order change is normally seen
existing work practices, or technology) to as large scale and disruptive.
enable a better fit between the
organisation and the environment.

In terms of the scale of change, first-order

change is seen as small-scale, incremental
and adaptive.


Not all elements in organisations can be subjected to changes. Elements that can
be changed are divided into four categories as shown in Figure 11.5.

Figure 11.5: Four categories of elements that can be changed in an organisation

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Next, are the explanations of the categories of elements that can be changed in an

11.3.1 Structure
Changing an organisational structure involves activities that affect many issues,
such as organisational design, authority relationship and a monitoring

For example, an organisational structure that is simple and lean can be changed
with team-based structures. In fact, altering the structure to new alternatives
such as telecommuting or job sharing can also change job design. These are done
to ensure that the needs of todays employees are fulfilled by the organisations
development while making certain that the organisation can successfully remain
competitive in the market place.

11.3.2 Technology
The introduction of new technologies in an organisation usually refers to the
introduction of new machineries or usage of robots and computers. This change
is vital in the development of an organisation since it brings forth a vast
improvement in productivity while simultaneously reducing manpower cost in
the long run.

Hence, technological changes play an important role in making certain that an

organisation has the vital competitive edge in the market place. These
advancements assist an organisation to obtain better and faster profits compared
to competitors who are slow in embracing the technological advancements.

11.3.3 Physical Arrangement

In addition to structure and technology, physical arrangements in an
organisation can also be changed. This change is usually done to ensure the ease
and comfort of employees whilst at work, thus increasing the employees
productivity. Therefore, management needs to take into consideration factors
such as work stress, formal interaction needs and employees socialising needs
prior to making decisions on the workspace, arrangement of work tools and
office interior design.

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11.3.4 Employees
Employees are the final element that can be changed by the change agent.
Assisting employees to increase their productivity and efficiency at work, both
individually and in teams, results in change. Employee change refers to positive
changes in work attitude and work behaviour, and these changes can occur
through improvements in communication, decision-making and problem solving

Can you think of how positive transformations in employees work attitude and
behaviour can occur through improvement in his/her communication, decision-
making and problem solving skills?


There are many resistances faced by an organisation when it initiates change,
despite the fact that changes are required to meet the demands of the ever-
changing and challenging business environment. In fact, researches conducted in
the areas of organisational behaviour show that resistances against change are
normal because change involves uncertainties (Bovey & Hede, 2001: de Jager,

Resistance against organisational change exists in various forms:

(a) Open resistance that occurs openly or explicitly, such as voiced out
complaints and walkout protests; and
(b) Resistance that is done subtly, such as low or lack of motivation, low or lack
of loyalty towards an organisation, and absenteeism.

Resistance can take place immediately after changes are introduced or they can
occur after changes have been introduced over a period of time.


Which of the following types of resistance is harder to overcome?

Discuss briefly.

(a) Explicit or implicit.

(b) Occurs immediately after change is introduced or happens after

change has taken place over a period of time.

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While there are various sources of resistance towards change, the two main
sources are individual resistance and organisational resistance.

11.4.1 Individual Resistance

There are five common reasons why an individual resists change. These reasons
Economic factor;
Fear of the unknown or uncertainty; and
Selective Information Processing.

Let us look at the explanation for each of these reasons.

(a) Habit
It is normal for an employee to form and/or to have his or her personal
routine in completing his or her respective tasks. For example, a manager
who shoulders the responsibility of making various decisions in his or her
area of work may have the habit of making the said decisions without
inviting opinion/s from other people. This behaviour, which is known as a
habit, can be very hard to change because the manager is already too
familiar with his or her behaviour.

(b) Security
A change in an organisation is always seen as a threat to an employees job
security. Employees are afraid of the change because change could result in
a job loss especially if the change brings forth redundancy in their current
position or requires them to learn new skills.

(c) Economic Factor

An employee may also be afraid of change if he or she believes that the
change may result in a reduction of his or her income. The reduction in
income or lower salary increment (from a negative performance appraisal)
might occur especially if an employee fails to adapt (in terms of job
performance) to the change.

(d) Fear of the Unknown or Uncertainty

It is normal for human beings to be afraid of the unknown or uncertainty.
In this instance, a change in the organisation refers to the introduction of
new elements to the current employees. Employees are afraid of new
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elements since they do not know or are uncertain of the effects of this
change on them.

(e) Selective Information Processing

Each individual has his or her pre-formed perception on the world, which
is difficult to be altered or changed. Therefore, when a change occurs in an
organisation, an employee may choose to embrace the said change or to
ignore it. The latter behaviour makes it hard for the management to
promote change.

11.4.2 Organisational Resistance

Organisations too, show resistance towards change. In fact, six reasons for
resistance towards change have been identified and these are:
Structural inertia;
Limited change focus;
Group inertia;
Threat against specialisation;
Threat against established power link; and
Threat against allocated resources.

(a) Structural Inertia

In almost every organisation, various steps are taken to ensure
organisational stability, e.g. organisational culture, rules and regulations
and management practices. In view of the fact that change can threaten the
stability of an organisation, the above-mentioned structural inertia (that has
been established) reacts to ensure that organisational stability is

(b) Limited Change Focus

An organisation consists of several interdependent subsystems. Therefore,
when a change occurs to one of the subsystems (without consideration for
other subsystems), problems and resistance to the said change are

(c) Group Inertia

Sometimes an employee is willing to change his/her behaviour or attitude,
but group norms can become obstacles towards his or her change. For
example, the workers union might not agree to the management decision

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to use new technology in the manufacturing process. Therefore, employees

who are members of the union will have to agree to the decision made by
the union.

(d) Threat Against Specialisation

A change to the job design may also be a threat to employees who have
already established a specialisation in a particular work area. For example,
the advancements in technology might prove to be a threat to a typist who
has acquired specialisation pertaining to writing reports and letters, since
these advancements might result in the typists job responsibility becoming

(e) Threat Against Established Power Link

The redesigning of an organisational structure, i.e. adaptation to a flatter
structure and strengthening of the team work concept could threaten
power relations that have been established by certain individuals.

(f) Threat Against Established Allocated Resources

Groups or subsystems that are normally in control of organisational
resources, i.e. finance, machineries, information, employees, and building,
may see change as a threat since there is a possibility of them losing control
over these resources.


Explain briefly why there is resistance against change.


At this point you have learnt about the resistance to changes. Now, we will look
at how to overcome change resistance. Resistance against change must be
controlled since this resistance can jeopardise the successful implementation of
change. There are six tactics that can be utilised by change agents to overcome
resistance towards change, and these include training and communication,
involvement, negotiation, manipulation, coercion, and providing facilities and

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11.5.1 Training and Communication

To ensure the successful implementation of change, it is imperative for
management to inform employees of the reasons why the change is required by
the organisation. Communicating the details of the change will reduce the level
of worry and uncertainties among employees. For this purpose, related training
exercises and various communication methods can be used to inform employees
about the change.

11.5.2 Involvement
Another method to overcome resistance is by involving employees in the
decision-making and planning for the change. This form of participation will
lessen employees resistance towards change in view of the fact that they are also
involved in the change process. Moreover, employees might be motivated to give
good suggestions towards the successful implementation of the planned change.

11.5.3 Negotiation
Resistance may also be reduced by making valuable offers, in the form of trade-
offs, to groups that are identified as possible obstacles towards the planned
change. For example, promising job security to every employee, in line with the
impending change, may result in lessening the employees uncertainty of losing
their current job.

11.5.4 Manipulation
Manipulation, which refers to misrepresentation of facts to make change appear
more attractive to employees, can be seen as an elusive tactic in obtaining
employees support towards change. Manipulation also refers to refraining from
informing employees of the negative aspects of a change whilst creating false
impressions of benefits to entice employees to accept the intended change.

11.5.5 Coercion
The last method is to coerce or force employees to accept change. Employees
who are defiant towards change are threatened with negative consequences of
their resistance, e. g. retrenchment or salary cut.

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11.5.6 Facilities and Support

To lessen worries among the employees pertaining to a change, the change
agents must provide counselling services, advisory and other types of support.
These supports will make it easier for the employees to accept change.


List all the tactics that can be used by change agents to overcome
resistance towards change. Provide one demerit for each tactic.


Now, we will look into how to manage and implement a planned change.
Flexibility in implementing suitable changes in a careful and/or well-planned
manner is paramount in ensuring that organisations are able to compete in this
ever-changing environment. This will also assist organisations to avoid negative
effects resulting from implementing poorly planned changes.

A planned change involves the change of activities that is done on purpose to

achieve intended objectives. For example, to increase product quality, a company
proposes to apply the concept of Total Quality Management (TQM). In this
instance, the employees involved in the management and operational levels are
trained on TQM. In addition, a committee is formed to handle matters that may
arise due to the implementation of TQM in the organisation. Hence, the planned
change mentioned here is a form of proactive change.

On the contrary, a change cannot be considered as a planned change if the

managements decision to tighten inspection for quality on its manufactured
products (before they are sent to customers) is due to the rising number of
consumer complaints. This is because these changes are done without prior or
earlier planning, and being done with the main aim of solving a specific problem.


Can you distinguish a planned change from an unplanned change?

Think of one example for each change that you have done in your life.

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11.6.1 The Goals of Planned Change

Planned change has two main goals:
(a) Increase organisational ability to adapt to the changes in the environment;
(b) Change the attitudes and behaviour of employees.

Both goals are important because it differentiates between a planned and unplanned
change. In addition, these goals will determine the organisations ability to remain
successfully competitive in the marketplace or business environment.

11.6.2 Change Agent

The change agent is the individual responsible for managing change activities.
Usually, employees of an organisation are selected as change agents. However,
there are numerous instances in which external consultants are engaged by some
organisations to become the organisations change agents. In this instance, the
consultants are engaged in view of their vast knowledge and experience in
carrying out organisational change and their ability to provide more objective
opinions on organisational problems as compared to employees within an


Conceptions of planned change have tended to focus on how change can be
implemented in organisations. Called theories of changing these frameworks
describe the activities that must take place to initiate and carry out successful
organisational change (Cummings and Worley, 2008). In this context, there are a
number of approaches that can be used to implement change. Popular
approaches include Lewins Three Step Model, Action Research Model and
Organisational Development Model. We will discuss each of these models in the
following section.

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11.7.1 Lewins Three-step Model (Lewins Change

According to Kurt Lewin, who was responsible for creating this model, a
successful change requires three steps, which are (Cummings and Worley, 2008):

(a) Unfreezing the Status Quo Preparing Employees for Change

This step usually involves reducing those forces maintaining the
organisations behaviour at the present level. By introducing information
that shows discrepancies between the behaviours desired by organisation
members and those behaviours currently exhibited, members can be
motivated to engage in change activities.

(b) Movement to a New Condition Introduction of the Intended Change

This step shifts the behaviour of the organisation, department, or
individual to a new level. It involves intervening in the system to develop
new behaviours, values and attitudes through changes in organisational
structures and processes.

(c) Refreezing the New Condition Making the Change a Continuous Process
This step stabilises the organisation at a new state of equilibrium. It is
frequently accomplished through the use of supporting mechanisms that
reinforce the new organisational state, such as organisational culture,
rewards and structures.

A status quo condition can be assumed as an equilibrium condition in which all

members of an organisation feel comfortable with the organisations current
culture/s. Therefore, prior to implementing a change, individual resistance and
group cohesiveness needs to be overcome first. This can be achieved by one of
the following three methods:
(a) Increase forces that drive behaviour out of the existing status quo;
(b) Decrease forces that obstruct movement out of the existing status quo; and
(c) Applying a blend of both methods mentioned above.

Figure 11.6 illustrates the steps mentioned above.

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Status Quo


Figure 11.6: Unfreezing status quo

Source: Adapted from Robbins, S. P. & Judge, T. A. (2008).
Organisational behavior. Prentice Hall

Employees are ready to accept change after the status quo condition is defrosted
or thawed. To ensure longevity of the implemented change, the new condition
needs to go through a refreezing process.

11.7.2 Action Research

The next approach in managing change is Action Research.

Action research refers to the process of change that is done based on a systematic
collection of data. Analysis of this data is used to select the most appropriate
change actions.

There are five steps in the Action Research process, as shown in Figure 11.7:

Figure 11.7: Steps in action research

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The description for each step of Action Research is shown in Table 11.2 below:

Table 11.2: Steps in Action Research

Step Description
Diagnosis This refers to interviewing employees, reviewing records and
determining employees grievances.
Analysis In this step, an analysis is made of all the information gathered
from the diagnosis level above. The analysis will reveal
problems that are currently faced by the organisation and
problems that might arise from the proposed change. In this
instance, possible and appropriate measures are recommended
for negative issues.
Feedback Solicitation Employees feedback (positive and negative) is solicited
pertaining to the current aspects of an organisation and on the
proposed change to be implemented.
Taking Action This refers to the implementation of suitable steps to overcome
the problems faced.
Conducting Evaluation In this final step, evaluation is made to gauge the effectiveness
of the change action that has been implemented.

11.7.3 Organisational Development

Let us look at the definition of organisational development.

Organisational development is a term used to refer to a collection of change

interventions that are planned. These planned change interventions have a
specific goal of increasing organisational effectiveness while improving the
welfare and well being of employees.

There are several organisational development techniques that can be

implemented in organisational change, such as:
Sensitivity training;
Survey feedback;
Process feedback;
Team building; and
Inter group development.

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The following explains these organisational development techniques:

(a) Sensitivity Training

This refers to the use of unstructured group interactions to change the
current behaviour of employees. In the unstructured group interactions,
employees are provided with the freedom to give their opinions and to
discuss the changes that are to be implemented.

A professional facilitator for these interactions is usually engaged by an

organisation. The facilitator will ensure that all employees are given the
opportunity to present their ideas on the organisations current culture/s
and on the change that is to be implemented. In addition, the facilitator will
also raise awareness amongst employees on their positive and negative
qualities and ways of improving their current qualities. The main goal of
this training (or unstructured group interactions) is to increase the
employees awareness on their behaviour whilst highlighting the
perception of their colleagues towards them.

Unstructured group interactions are also meant to increase employees

understanding on group process whilst highlighting the significance of
improving their individual listening skills. Employees are also encouraged
to note the importance of having an open attitude, as well as conflict
resolution and tolerance skills to better manage individual differences.

(b) Surveys Feedbacks

Feedback from surveys conducted in an organisation is another method
that can be utilised to evaluate the attitude of its members, identify
differences in perception among them and narrow the gap between these

In general, survey questions usually focus on employees perception and

attitude on various topics, which include decision-making practices, the
effectiveness of the organisations current communication process,
coordination among units and employees satisfaction pertaining to work,
co-workers and immediate supervisors.

The collected data will be used to identify the current problems of the
organisation including employees grievances. In addition, these data can
also be utilised by the management to provide employees with a clear
feedback on other issues that are ambiguous to them. Survey results are also
tools to encourage employees to hold discussions amongst themselves with
the hope that via these discussions, employees can reach a mutual agreement
and/or solution to the problems that are highlighted through the surveys.

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(c) Process Consultations

Consultants are engaged by the organisations to provide managers with
better feedback and understanding about themselves, their surroundings
and other aspects of the organisation. With the assistance of a consultant,
the manager will gain skills to diagnose management processes that require
change and identify alternative solutions to selected problems and/or

(d) Team Building

Team building is a method that uses group interaction activities to increase
trust and openness among members of a team. This is done via goal setting
activities, interpersonal development among team members, role analysis
to clarify the responsibilities of each team member and analysis of the team
process. In addition, activities to analyse the main process of the team tasks
are also conducted. These activities would be able to identify current
weaknesses whilst highlighting improved work process techniques that
would increase team effectiveness.

(e) Inter Group Development

Inter Group Development refers to the techniques used to bring forth
changes in the attitudes and perceptions of teams towards other teams. For
example, employees in the human resource department would have a
stereotypical assumption of employees in the finance department as being
overly prudent when resources are required for the purpose of human
resource development. A negative perception such as this will make
coordination efforts between these departments difficult.

A popular Inter Group Development method that is commonly used is the

problem solving method in which all teams involved will make the
following lists:
(i) Team As self-perception list (What are the opinions of Team A about
its own members?).
(ii) Team Bs self-perception list (What are the opinions of Team B about
its own members?).
(iii) The perception list of Team A and Team B of each other (What are the
opinions of Team A about Team B and vice versa?).

Upon completion of these three lists, both teams will discuss their internal
(within a team) and external (between teams) similarities and differences. Most
importantly, both teams MUST discuss their differences of opinions about each
other and ways to resolve these differences. In addition, negative perceptions
and prejudices must be identified and clarified. As soon as these are done, the

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teams will move into the integration phase, in which they will find ways to
rectify and improve their internal and external relationships.


1. Why does an organisation need to change?

2. List the causes of resistance towards change and explain why

employees involvement is seen as the most effective technique to
reduce resistance towards change?


How does the Lewins Three-Step Model manage resistances towards



This subtopic will introduce ways to sustain changes. One of the greatest
challenges for those involved in managing change is to try to ensure that change
is not just for a short period only. Hence, what can be done to increase the
probability that change initiatives do not falter and instead become embedded in
organisations as normal practice? Table 11.3 shows the explanations of the
actions that can help organisations to sustain change.

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Table 11.3: Actions that Can Help Organisations to Sustain Change

Action Explanation

Redesign Roles Redesigning roles in an organisation is a common outcome of

many organisational changes. In this context, the more
significant directions of causality for both behaviour and
attitudes are, the most influenced by the context of roles,
relationships and responsibilities of the people performing

Redesign Reward In order to reinforce a companys commitment to change, it may

System need to develop and implement a carefully designed evaluation
and reward system. This is an important issue in order to attract
the workforce to commit to the changes and increase their
motivation level. The rewards should include revising an
organisations pay system, giving public recognition to those
whose behaviours are consistent with the desired change and

Link Selection In this context, it is likely that some changes will occur in the
Decisions to Change top-management team before a major change is fully embedded
Objectives in the organisation. As with the allocation of rewards, a proper
selection decision needs to be done to align with the changes

Act Consistently with In this regard, what is required is the action, not just words. It
Advocated Actions needs fully committed efforts from the workforce to act
accordingly following the planned changes.

Encourage In this context, change is more likely to become embedded if

Voluntary Acts of those at the operational level are supported when they take
Initiative. action to develop the specific forms of the general initiative that
they believe appropriate for their local circumstances.

Measure Progress A focus on measurement is important. In this context, it is a

means of monitoring the progress of the change and what gets
measured is likely to have a significant impact on how people
react. Recommended methods include quantitative performance
measures, attitude surveys, focus groups and individual

Source: Palmer, Dunford & Akin (2008)

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Choose the correct answer.

1. The environmental elements that are vital in generating

organisational change include all the alternatives below EXCEPT:
A. Changes in workforce
B. Changes in technology
C. Changes in competition
D. Changes in distribution of wealth

2. Individual resistance to change are related to various reasons

which include:
A. Habit
B. Security
C. Selective information processing
D. All of the above reasons

3. Which of the statements below is false regarding planned change?

A. Unfreezing involves providing a rationale for the need to
B. It involves efforts to move an organisation from its current
state to a new state.
C. Moving involves providing power to employees to create
and implement change.
D. It involves a three-phase process comprising of unfreezing,
moving and refreezing.

4. Which of the techniques below can be implemented in organisational

A. Team building
B. Survey feedback
C. Sensitivity training
D. All of the above

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5. Which of the statements below describes an organisation's

A. It refers to a collection of change interventions that are planned.
B. It is an applied field of study focused on improving processes
and outcomes in an organisation.
C. The planned change interventions have a specific goal of
increasing organisational effectiveness.
D. All of the above answers.

There are several forces for change which can influence an organisation
workforce, technology, competition, world politics and mandated pressures.

In view of this, it is imperative for organisations to make rapid

accommodation and adjustments to these changes to enable them to remain
competitive in the market place.

To ensure effective implementation of change, organisations should involve

their employees in the change planning and decision-making.

A planned change involves the change of activities that are done on purpose
to achieve intended objectives.

In addition, managers should also play their role as agents of change whilst
being a role model to their subordinates.

All in all, change is required in this ever-changing and competitive market

place of today, and employees must constantly update their skills and
abilities to remain relevant and useful.

Resistance against organisational change exists in various forms open

resistance that occurs openly or explicitly, and resistance that is done subtly.

There are six tactics that can be utilised by change agents to overcome
resistance towards change, and these include training and communication,
involvement, negotiation, manipulation, coercion, and provision of facilities
and support.

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Change resistance Structured inertia

Group inertia Sustaining change
Planned change

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If you have any comment or feedback, you are welcome to:

1. E-mail your comment or feedback to


2. Fill in the Print Module online evaluation form available on myVLE.

Thank you.

Centre for Instructional Design and Technology

(Pusat Reka Bentuk Pengajaran dan Teknologi)
Tel No.: 03-27732578
Fax No.: 03-26978702

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