Organizational Behavior

Organizational Behavior

The study of individual behavior and

group dynamics in organizations
 Elements of OB

Task – an organization’s mission, purpose, or goal for

existing
People – the human resources of the organization
Structure – the manner in which an organization’s work
is designed at the micro level; how
departments, divisions, and the overall
organization are designed at the macro
level
Environment – Both Internal and External

Technology – the tools, knowledge, and/or techniques used

to transform inputs into outputs
 Organizational Behavior:
Dynamics in Organizations

Psychosocial

Interpersonal Organizational Behavioral

Behavior
 Open Systems View of
Organization Task environment:
Competitors
Unions
Regulatory agencies
Clients

Structure
Inputs:
Material Outputs:
Capital Task Technology Products
Human Services
People
(Actors)
Organizational Boundary
Organizational Variables that
Affect Human Behavior
Communication

Organizational Performance
Structure Human Appraisal
Behavior
Work
Jobs
Design
Organizational
Design
 Sociology
Psychology the science
the science of society
of human Engineering
behavior the applied
science
Interdisciplinary of energy &
Anthropology Influences on matter
the science of
Organizational
the learned Medicine
behavior of Behavior the applied science
human beings of healing or
treatment of diseases
Management to enhance an
individual’s health and
the study of overseeing
well-being
activities and supervising
people in organizations
 Formal organization
(overt)
Formal Goals and objectives
& Policies and procedures
Informal Job descriptions
Elements Financial resources
Authority structure
of
Communication channels
Organizations Products and services

Informal organization
(covert)
Beliefs and assumptions
Perceptions and attitudes
Values
Feelings, such as fear, joy
anger, trust, and hope
Group norms
Informal leaders
 Formal vs. Informal Organization

Formal Organization – the official, legitimate,

and most visible part of the system

Informal Organization – the unofficial and less

visible part of the system
Learning about Organizational Behavior
Learning Activity

Mastery of
basic objective Science
knowledge
Theories, Research, Articles

Development of
The Real World
specific skills
and abilities
Organizational and Work Context

Application You
of knowledge
and skills Exercises, Questionnaires
• OB is directly concerned with the understanding,
prediction and control of human behaviour in
organizations (Luthans).

• OB – The study and application of knowledge how

people act or behave within organization. It is a
human tool for human benefit. (Davis & Newstrom)

• OB is a field of study that investigates the impact that

individuals, groups, and structure have on behaviour
within organizations for the purpose of applying such
knowledge towards improving on organization’s
effectiveness. (Robbins)
Individuals Groups

OB

Structure
 Nature of OB

• A separate field of study and not a discipline

only
• An interdisciplinary approach (Psychology,
Sociology and Anthropology)
• An applied science
• A normative science
• A humanistic & optimistic approach
• A total system approach
 Scope of OB
Individuals Groups

- Personality - Group Dynamics

- Perception - Group Conflicts
- Attitudes - Communication
- Motivation - Leadership
- Job Satisfaction - Power & Politics
- Learning OB
- Values

Structure

- Org. Str.
- Culture
- Org. Change
- Org. Development
 Foundations of OB

OB is based on few fundamental concepts which

revolve around the nature of people and
organization

1. Individual Differences
2. A whole person
3. Caused behaviour
4. Human dignity
5. Organizations are social system
6. Mutuality of interest
7. Holistic concept
8. Need for management
 Importance of OB
1. OB provides a road map to our lives in organizations.

2. OB uses scientific research to help us understand and

predict organization life.

3. OB helps us to influence organizational events.

4. OB helps an individual to understand himself/herself and

others better.

5. OB will help the manager to understand the basics of

motivation.

6. OB useful for maintaining cordial industrial relations.

 Basic Process of OB

Problem Prevention

PREDICTION CONTROLLING
UNDERSTANDING
- What pattern of - What solutions
behaviour are are possible?
- How strong
present?
are they?
- Which variables
- What is the can be influenced?
- How do they
cause-effect
interrelate?
relationship? - How can they be
influenced?
 Approaches to the study of OB

HR Productivity
Approach Approach

OB
Systems
Interactionalism
Approach
Approach

Contingency
Approach
 Models of OB

Autocratic Custodial Supportive Collegial

Basis of Power Economic Leadership Partnership
model sources

Managerial Authority Money Support Teamwork

orientation
Employee Obedience Security and Job Responsible
orientation benefits performance behaviour

Employee Dependence on Dependence Participation Self-discipline

psychologica boss on
l result organization

Employee Subsistence Security Status & Self-

needs met recognition actualization

Performance Minimum Passive Awakened Moderate

result cooperation drives enthusiasm
Foundations of Individual Behaviour
Stages in Organizational Life
 Models of Individual Behaviour
• Theory X & Theory Y Model

• Economic & Self-Actualizing Model

• Behaviouristic & Humanistic Model

- individuals can be describes solely in
terms of behaviour (behaviouristic)
- individuals are more philosophical
than scientific (humanistic)

• Rational and Emotional Model

 Concluding remarks

• Personal factors such as age, sex, education, abilities, marital status, and
dependents will have significant influence on the behaviour of an
individual.
• Environmental factors include economic status, social and cultural norms,
and political factors. These also wield considerable influence on individual
behaviour.
• Organizational systems and resources include such variables as physical
facilities, organization structure and design, leadership rewards and work
itself. The influence of all these on the behaviour of an individual is no less
significant.
• More important are psychological factors like personality, perception,
learning, and attitudes. Because of their significance in determining one’s
behaviour, each of these factors is considered separately in the following
chapters.
• The famous Theory X and Theory Y, along with other models, seek to
explain the behaviour of an individual.
Major Challenges of OB
 OB Challenges

Changing demographics
Managing diversity
Of workforce

Ethical Behaviour Changed employee

OB Challenges expectations

Technology Globalization
transformation
 I - Managing Diversity

Managing diversity is a philosophy about how

differences among individuals are accepted and
respected and how they are made to work in
cohesion.

Objectives:
- Access to a changing marketplace
- Large scale business transformation
- Superior customer service
- Workforce empowerment
- Total quality
 Dimensions of Diversity

1. Primary Dimensions
Age, Gender, Mental & Physical abilities

2. Secondary Dimensions
Education, Culture, Geographic location,
Work experience, Religion, Language,
Family status, Organizational role and level.
 Benefits and problems of Diversity

Benefits Problems
• Attracts retains the best • Resistance to change
human talents • Lack of cohesiveness
• Promotes creativity and • Communication
innovation problems
• Results in better • Interpersonal conflict
problem solving • Slow decision making
• Enhances
organizational flexibility
 Managing Diversity

• Increasing Awareness

• Increasing Diversity Skills

 Barriers to Accepting Diversity
1. Prejudice – negative attitude towards a person to
accept as a member of the group

2. Ethnocentrism – a tendency to regard one’s own

group, culture or nation as superior to others

3. Stereotypes – set of beliefs about a group that is

applied universally to all members of that group
4. Discrimination

5. Harassment

6. Backlash – negative reaction to the gaining of power

and influence by members of previously under
represented groups
 II – Changing Demographics of Workforce

• Dual career couples

III – Changed Employee Expectations

• Empowerment and quality of status, Strategic

Business Partner
 IV - Globalization

Its impact on People Management.

The mgt. requires to cope with problems of unfamiliar

laws, languages, practices, competitors, attitudes,
management styles, work ethics, etc.
 V – Technology Transformation

- Automation
- Information technology (IT)
- Job design
- Rationalization
- Downsizing/Right sizing/Smart sizing
- Virtual offices

Automation & IT enables an organization

to become leaner.
 VI – Promoting Ethical Behaviour

Ethics refers to a system of moral principles – a

sense of right and wrong, the goodness and
badness of actions, and the motives and
consequences of these actions. As applied to
organizations, ethics is the study of good and
evil, right and wrong, and just and unjust
actions of managers.
 Why Ethics Important?

• Ethics correspond to basic human needs.

• Values create credibility with the public
(ethical and social responsiveness )
• Values give the management credibility with
its employees
• Values help in better decision-making
• Ethics and profit go together
• Law cannot protect the society, ethics can.
 Ethical Behaviour in the Workplace

Cultural
Influences
•Family
•Education
•Religion

Organizational Influences
• Ethical codes
• Organizational culture Individual
• Role models • Personality
Role • Values
• Perceived pressure for
results
Expectations • Morals/Principles
• Reward & punishment • Gender
system

External Factors Ethical Behaviour

• Political/Legal
• Economic
• Technological
 Managing Ethics
• Role of top management

• Code of ethics

• Ethics committees (to advice on ethical issues)

• Ethics Hot Lines (communication on unethical practices

to the ethics committee members)

• Ethics Training programmes

• Ethics and Law (have a common aim – defining proper

and improper behaviours)
VALUES
 Values
Enduring beliefs that a specific mode of
conduct or end state of existence is
personally or socially preferable to an
opposite or converse mode of conduct or
end state of existence (Rokeach)

Value is a concept of the desirable, an

internalized criterion or standard of
evaluation a person possesses (White &
Bednar)
 Types of Values

Instrumental – values that represent the

acceptable behaviors to be used in
achieving some end state

Examples: honesty, politeness, courage

Terminal – values that represent the goals

to be achieved, or the end states of
existence
Examples: happiness, self-respect, prosperity
 Cultural Differences in Values

Chinese value an
individual’s contribution
to relationships
in the work team
Americans value an
individual’s
contribution to task
accomplishment
 Work Values

• Achievement (career advancement)

• Concern for others (compassionate
behavior)
• Honesty (provision of accurate
information)
• Fairness (impartiality)
 Ethical Behavior

Acting in ways consistent with

one’s personal values and the
commonly held values of the
organization and society
 Values, Ethics, and Ethical Behavior

Value Systems – systems of beliefs that

affect what the individual
defines as right, good, and fair

Ethics – reflects the way values are

acted out

Ethical Behavior – actions consistent with

one’s values
 Qualities Required for Ethical Decision Making

The competence to identify ethical issues and

evaluate the consequences of alternative courses
of action

The self-confidence to seek out different opinions

about the issue and decide what is right in terms of
a situation

Tough mindedness – the willingness to make

decisions when all that needs to be known cannot
be known and when the ethical issue has no
established, unambiguous solution
 Values & Behaviour
- Values affect behaviour because they affect
employees views of what constitutes right and wrong.
- The diversity of the work force makes it imperative
that the managers understand difference in values.
Understanding values is useful in the following ways:

1. Values serve as foundation for attitudes

2. Individuals hold their own interpretations of right and
wrong
3. Values affect both attitude and behaviour
4. Re-examining the established values poses challenges
for the modern management (the value-based
management)