Chapter 4 2 types of information before entering the
organization
ORGANIZATIONAL CULTURE AND ETHICS
Organizational Culture – is what the employees
perceive and how this perception creates a
pattern of beliefs, values, and expectations.
Organizational Culture – is the informal set of
values and norms that controls the way people
and groups in an organization interact with each
other and with people outside the organization
such as customers and suppliers.
What is Culture in an organization?
 Are assumptions, adoptions, perceptions
and learning.
 Is important because it affects all kinds of
goals the organization wishes to achieve
and how the organization will pursue them.
3 layers of organization
1. Layer 1 – involves artifacts and
creations that are seen but often
cannot be interpreted.
2. Layer 2 – are made up of these values
such as desires or wants.
3. Layer 3 – concerns assumptions people
make that guide their behavior.
Culture – influences the way members of the
organization relate to each other as well as their
relations with people outside the organization.
Socialization – is the process by which
organizations bring new employees into the
culture.
Socialization Stages
1. Anticipatory socialization
2. Accommodation
3. Role management
Anticipatory socialization – stage wherein the
individual prepare for entering the organization.
1. They want to know what working for
the organization is like.
2. People want to know whether they are
suited to the job in the organization.
Implications of Organizational Behavior to
Managers
“Why should managers study
organizational behavior?”
Organizational theory will make managers
understand how organizations are
structured, how they should be managed,
and understand what organizations actually
are. Theories about organization are meant
to improve our understanding of
organizations and how they operate to
survive. It prepares employees and
managers what to expect once employed in
the organization.
Organizational Behavior – is an avenue for
better understanding and improving
workplace ethics.
Ethics – involves the study of moral issues
and choices. It reflects rights vs. wrong,
good vs. bad.
Do moral principles vary by gender?
Carol Giligan – a well-known psychologist,
identifies one underlying cause of these
gender differences. Her research revealed
that men and women differed in terms of
how they conceived moral problems. Males
perceive moral problems in terms of a
justice perspective while women relied on a
care perspective.
Justice Perspective – Males believes that
moral principles must be anchored on
reciprocal rights and that rules and
regulations must govern in any moral
problem in an organization.
Care Perspective
– women approach men in terms of
compassion. Women would prefer
attention than rule and regulations. Women
study situations and decide with
compassion, that no one gets hurt in the
process.
Guiding principles in Care perspective
approach:
1. Care
2. Kindness
3. Compassion
Kent Hodgson- management consultant and
writer, provided managers with suggestions
to ethical decisions by identifying seven
general moral principles.
The Magnificent Seven:
1. Dignity of Human Life – the lives of
people are to be respected.
2. Autonomy – we should act in ways that
demonstrate each person’s worth,
dignity, and right to free choice.
3. Honesty – also known as integrity, truth
telling and honor.
4. Loyalty – includes fidelity, promise
keeping, keeping the public trust, good
citizenship, excellence in quality of
work, reliability, commitment, and
honoring just laws, rules and policies.
5. Fairness – treating people justly and
fairly.
6. Humaneness
-our actions ought to accomplish the
good
-we should avoid doing evil
7. The Common Good – one should act
and speak in ways that benefit the
welfare of the largest number of
people, while trying to protect the
rights of individuals.
How to improve the Organization’s ethical
climate:
 Behave ethically yourself.
 Screen potential employees.
 Develop a meaningful code of ethics.
Code of ethics can have a positive impact if
they satisfy these 4 criteria:
1. They are distributed to every employee.
2. They are firmly supported by top
management.
3. They refer to specific practices and
ethical dilemmas likely to be
encountered by target employees.
4. They are evenly enforced with rewards
for compliance and strict penalties for
noncompliance.
Ethics – is the branch of philosophy that
deals with the morality of human decisions
and actions
Business ethics – deals with them in a
business setting.
Approaches used to determine morality of
decisions:
1. Utilitarianism (Jeremy Bentham & John
Stuart Mill) – maintains that a moral
decision or action results in the greatest
good for the greatest number of
people. The theory behind this
approach is that pleasure causes
happiness and pain takes it away.
2. Right and Duties (Immanuel Kant) – the
theory is based on the positions that
individuals have rights, either as
humans, as citizens of a given country
or state, or as occupants of a particular
positions. These rights grant duties on
others, and a given decision or act can
be established by an analysis of these
rights and duties.
3. Justice and Fairness (John Rawls)

Reduction or Lay-offs (READ PDF)
Macro Organizational Theories
1. Population-ecology model – suggest that
environmental factors select organizational
characteristics which best fit the
environment in which they operate.
2. Resource-dependence model – suggests
that organizations make decisions mediated
through their political context. Rather than
being passive recipients of environmental
forces, organizations, particularly their
management, will mould their environment
and make strategic decisions.
3. Rational-contingency model – suggests that
through a combination of rationality an
contingency which means the recognition
that there is no one best way organizations
will deal with their environment.
4. Transaction-cost model – derives from the
field of economics and attempts to explain
the existence of organizations in the private
sector.
5. Institutional model – suggests that
organizations exist alongside others in the
same field and take on many of the same
characteristics as each other.
Multi-local Firm
 is a multi-national company whose global
business strategy has developed gradually
by a natural process.
 Uses market segmentation strategy to each
host country, differentiating its products to
meet the unique need of each national
market.
How to deal with Differences in National
Cultures?
 Power-distance
 Uncertainty avoidance
 Individualism-collectivism
 Masculinity-femininity
 Long-term, short-term orientation
Business bride- is an inducement aimed at
influencing an official to act improperly in the
exercise of duties, such as granting a contract
unfairly, or otherwise giving preferential
treatment.
A Global Perspective on People at Work
 International Management- is a
management that involves the conduct of
business activities in more than one
country.
 International Organizational Behavior- is a
study of individuals and groups in
organizations operating in an international
setting.
 Multinational Employers
Value Systems- an egalitarian oriented
value system call for rewarding all
employees equally, regardless of their
comparative contributions.
4 types of value system
1. Elite
2. Meritocratic
3. Leadership
4. Collegial
Elite value system- endorses values related
to acceptance of authority, high
performance, and equitable rewards.
Collegial value system- supports values
associated with teamwork, participation,
commitment, and affiliation while
discouraging values of authority, high
performance, and equitable rewards.
Why ethics is a vital part of management
practices?
John F Akers- former chairman of the board of
IBM who said that it makes good business sense
for managers to be ethical.
*ethics and competitiveness are
inseparable
Code of ethics- is a formal statement that acts
as a guide for the ethics of how people within a
particular organization should act and make
decisions.
Quality circle- build on the notion of
participative decision making that employees
can take responsibility for their work and can
make meaningful decisions about improving
work quality.
Seven S Theory ( Pascale& Athos, 1981 )
 All organizations are controlled by seven
variables:
 Superordinate goals
 Strategy
 Structure
 Systems
 Staff
 Skills
 Style
 Hard Ss- are strategy, structure, and
systems
 Soft Ss- are staff, skills, and style
Theory Z (Ouchi, 1981)
o is a hybrid between theory x and theory
y - NEED means some internal state that makes
o combines some elements of both the
bureaucratic and human relations
approaches to organization
According to Ouchi, the model has the
following features:
o Lifetime employment
o Nonspecific career paths
o Slow promotions
o Participative decision making
o Collective responsibility
o Holistic concern for employees
Chapter 5
New knowledge workers- workers in business
process outsourcing; call centers.
Knowledge- recognized worldwide as one that
drives economic growth and wellbeing in a
country.
Motivation- is an idea we use to describe forces
acting on or within an individual to initiate and
direct behavior. Ex. Most people would work
overtime to earn more money or students
would study more, review more, or prepare
their lessons thoroughly to earn high grades.
-willingness to exert high levels of effort toward
organizational goals, conditioned by the effort’s
ability to satisfy some individual need.
Different theories about work motivation:
1. Need theory
2. Expectancy theory
3. Equity theory
4. Procedural justice theory
Three key elements in definition: effort,
organizational goals and needs.
- the EFFORT element is a measure of intensity
certain outcomes appear attractive.
Early theories of motivation:
1. Hierarchy of needs theory
2. Theories x and y
3. Motivation-hygiene theory
Need theory- most important message is that
workers have needs that must be satisfied so
that they are motivated in the workplace.
Goal- what an individual aims to accomplish;
target and objective for future performance.
Setting goals- helps employee prioritize on
items of greater importance.
-provide managers with a roadmap to better
planning as they allot scarce resources. Success
attribute self-efficacy.
2 characteristics of goals that used together,
lead to high levels of motivation and
performance.
1. Specifity- specific goals are prepared
which are often quantitative.
2. Difficulty – difficult goals lead to higher
motivation and performance than easy
or moderate goals.
Management by Objectives- formal system to
be sure that goal setting is done on a periodic
basis. Evaluate to extent to which previously set
goals have been achieve.
-incorporates participation in decision making,
goal setting and objective feedback.
Three Basic Steps of MBO:
1. Goal setting- manager and supervisor
set the goasl and will try to achieve
these goals during a period.
2. Implementation- the manager is given
the autonomy to decide how to meet
goals in the specified time period.
3. Evaluation- at the end of specified time
period, the manager and supervisor
again meet to assess the extent of goals
attained and discuss why some goals
may not have been attained and then
set goals for the next time period.
Elements of Goal Setting
1. Goal acceptance- effective goals are
those explained to the employee and is
understood and accepted.
2. Specificity- goals need to be as specific,
clear and measurable as possible.
3. Challenge- most employees work
harder when they have difficult goals to
accomplish rather than easy ones.
4. Performance monitoring/feedback-
observing behavior, inspecting output
or studying documents of performance
indicators that provides at least subtle
cues to employees that their tasks are
important, effort is needed and
contributions are valued.
Motivation to work- means the work forces
inside an individual account for the level,
direction and persistence of effort used work.
High performance in the new workplace
depends on the combination of; individual
performance equation factors, level, direction,
and persistence.
Edwin Locke- defined goals as “what an
individual is trying to accomplish, it is the object
or aim of an action.
Behavior Modification or Operant Conditioning-
B.F. Skinner; this principle comes from the
observation that the result of an individual’s
behavior in one situation influences the
individuals, behavior in similar situations that
may happen in the future.
-deals with establishing work situation such as
reward and recognition policies that help
subordinates learn work habits deemed
satisfying to them; employee of the year.
-based on law of effect that states “the
behavior that results to gaining a reward is
likely to be repeated while behavior that leads
to punishment or negative result will not be
repeated.”
Goal setting theory- Edwin locke, places specific
emphasis on the importance of conscious goals
in explaining motivated behavior.
Goal Specifity- degree of quantitative
perception or clarity of the goal
Goal Difficulty- degree of proficiency or level of
performance sought.
Goal intensity- means the process of setting the
goals or determining how to reach it.
Goal Commitment- the amount of effort used to
achieve a goal.
Behavior modification process:
The STIMULUS is the situation or event while
the individual’s voluntary behavior is the
RESPONSE. Once the RESULT or CONSEQUENCE
of behavior modification is positive, the
individual will repeat the RESPONSE IN THE
FUTURE. However, a negative result will make
the individual change his behavior to avoid the
situation.
Methods of Behavior Modification:
1. Positive reinforcement- an individual is
encouraged to repeat the behavior if
the result is a reward or recognition.
Reinforcers are classified as PRIMARY:
food, water or shelter or biological
needs and SECONDARY: salary
increase, promotion, praise , awards,
money. This reinforcers will give
pleasure so individual repeat the
behavior. More humane and effective.
2. Avoidance Learning- a situation where
people learn to escape or avoid
unpleasant outcomes that gave
negative results. Criticism or
reprimanded by supervisors.
3. Extension- absence of reinforcement
after an undesired behavior was
committed.
4. Punishment- when subordinates carry
out unbecoming behavior, managers
and supervisors discipline them through
giving punishment. Denying privileges,
harsh criticism, demotion, etc. not
recommended.
Rules of Modifying Behavior by Luther and
Kreitner:
1. Identification of specific undesirable
behavior
2. Measurement how often the behavior
is committed
3. Analysis where the manager tries to
ascertain what is causing the behavior
4. Intervention- includes:
a. Developing a strategy to change
the behavior
b. Implementing the strategy
c. Measuring the frequency of
the resulting behavior
5. Evaluation where manager decides how
effective the whole procedure has
been.
Hierarchy of Needs Theory- by Abraham
Maslow
1. Physiological- hunger, thirst , shelter,
sex, bodily needs
2. Safety- security and protection from
physical and emotional harm
3. Social- affection, belongingness,
acceptance and friendship
4. Self-Esteem- internal esteem factors:
self-respect, autonomy, achievement
 and external factors: status, recognition
and attention.
5. Self-actualization- grow and use abilities
to the fullest
Order (lower to higher): physiological-safety-
social-self-esteem- self-actualization
Lower needs are predominantly satisfied
externally while higher needs are satisfied
internally.
Mc Gregor’s Theory X and Theory Y- explains
the nature of people in workplace.
-Douglas McGregor proposed two distinct views
of human beings: one basically negative labeled
as theory x and the other positive labeled as
theory y.
THEORY X
1. Most people dislike work and avoid it
when they can
2. Most people must be coerced and
threated with punishment before they
will work
3. Most people prefer to be directed
4. They tend to avoid responsibility and
show little ambition
THEORY Y
1. Work is a natural activity, like play or
rest
2. People are capable of self-direction and
self-control if they committed to
objectives
3. People generally become committed to
organizational objectives if they are for
doing so
4. Can learn to accept and seek
responsibility
5. Has imagination, ingenuity and
creativity
Alderfer’s ERG Theory- categorizes needs into:
1. Existence- needs that are about the
desire for physiological and material
wellbeing
2. Relatedness- about the desire for
satisfying interpersonal relationships
3. Growth- pertains to the desire for
continued personal growth and
development.
-the Satisfaction-progression principle means
that an already satisfied lower-level need can
become activated when a higher-level need
cannot be satisfied.
McClelland’s Theory- David I. McClelland used
Thematic Apperception Test (TAT) as a way of
measuring human needs. TAT is a projective
technique that asks people to view pictures and
write stories about what they see.
Three Needs:
1. Need for achievement- desire to
undertake something better or more
efficiently, to solve problems or to
master complex task
2. Need for affiliation- desire to establish
and maintain friendly and warm
relations with other
3. Need for power- desire to control
others, to influence their behavior or to
be responsible for others.
Herzberg’s Two-Factor Theory- the
MOTIVATOR-HYGIENE THEORY was proposed
by Frederick Herzberg. Found out that the
factors identified as sources of work
dissatisfaction also called dissatisfiers or
“hygiene factors” were different from those
identified as sources of satisfaction called
satisfiers or “Motivator factor”.
-focuses on the distinction between sources of
dissatisfaction and satisfaction factors.
Equity Theory- J. Stacy Adams argues that
people gauge the fairness of their work
outcomes compared with others and that felt
inequity is a motivating state of mind. When
people perceive inequality in their work, they
experience a state of cognitive dissonance or
mental confusion. They will be aroused to
remove the discomfort and to restore a sense
of felt equity to the situation.
-a model of motivation that explains how
people strive for fairness and justice in social
exchanges.
Two ways of analyzing job design involves:
1. Job depth- concerned with the extent
to which a person can control his work.
2. Job scope- indicates the number of
different operations a particular job
requires and how often the job cycle is
repented. The lower number of
operations and the greater number of
repetitions, the lower the scope.
Intrinsic Reward- a reward an individual
receives as a result of task performance and do
not require the participation of another person.
Job Design- planning and specification of job
tasks and the work setting designated for their
accomplishment.
Following segments:
1. The specification of individual task
2. Specification of the method performing
each task
3. Combination of individual tasks into
jobs t be assigned to individuals.
Four major approaches to job design:
1. Job simplification or job engineering
2. Job enlargement
3. Job rotation
4. Job enrichment
Job Content- sum of all the work tasks that the
jobholder may be asked to perform.
Job methods- aims to find the best way to do a
job.
Job simplification- concerns the standardization
of work procedures and employ people in
clearly defined and specialized tasks.
Scientific Management- set of principles and
practices stressing job simplification and
specialization developed by Taylor to increase
the performance of individual workers.
Job Specialization- males workers the authority
or experts in their particular tasks since the
assignment of workers is to perform small,
simple tasks.
Time and motion studies- studies that show
how long it takes to complete a tasks and the
best way to do it
Job Enlargement- done by adding more tasks a
worker performs although all of the tasks have
the same difficulty and responsibility. Called as
horizontal job loading because it expands but
difficulty remains the same.
Job Enrichment- creates jobs that allow
opportunities for the worker by giving workers
more responsibility and control over their jobs.
Called vertical job loading because workers are
given some responsibilities that were done by
their supervisors.
Job Characteristics Model- proposed by Richard
hackman and greg Oldham. It discusses a
detailed and accurate account of the effects of
job design on motivation, performance, job
satisfaction and other important aspects of OB
Core Job Dimension- common characteristics
found to a varying degree in all jobs.
Three of job characteristics combined to
establish experienced meaningful work:
1. Skill Variety-extent to which job
requires a worker to use a number of
different skills, abilities or talents.
2. Task identity- the extent to which a job
involves performing a whole piece of
work from beginning to end.
3. Task significance- extent to which a job
as an impact on the loves or work of
other people in or out of the
organization
4. Autonomy- degree to which a job
allows a worker the freedom and
independence to schedule work
5. Feedback- extent to which performing
job provides a worker with clear
information about his/her effectiveness.
Motivating Potential of a Job- the motivating
potential score (MPS) is a summary index that
represents the extent to which the job
characteristics foster internal work motivation.
-low scores= not experience high internal work
motivation from job. (redesign), high score= job
is capable of stimulating internal motivation
Computation: MPS= (Skill task variety+ Identity+
Task significance /3) x autonomy x feedback
Job Satisfaction is an effective or emotional
response toward various facets of one’s job
Five predominant models:
1. Need fulfillment- propose that
satisfaction is determined by the extent
to which the characteristics of a job
allow an individual to fulfill his needs.
2. Discrepancies- propose that satisfaction
is a result of met expectations.
3. Values attainment- satisfaction results
from the perception that a job allows
fulfllment of an individual’s important
work values.
4. Equity- perception that the job is “fair”
and how the individual is treated at
work.
5. Trait/Genetic components- tries to
explain that job satisfaction is a
function of both personal traits and
genetic factors.
Job Involvement- represents the extent to
which an individual is personally involved with
his work role.
Organization Citizenship Behavior- made up of
employee behaviors that are beyond the call of
duty.
Five core job dimensiosn contribute to THREE
CRITICAL PSCHOLOGICAL STATESl:
1. Experienced meaningfulness of the
work- degree to which workers feel
their jobs are important and
meaningful.
2. Experienced responsibility for work
outcomes- extent to which workers feel
that they are personally responsible for
their job performance.
 3. Knowledge of results- degree to which
workers know how well they perform
their jobs on a continuous basis.
Social Information Processing Model- how
workers perceive and respond to the design of
their jobs is influenced by social information or
information from other people and by workers’
own past behaviors.
Evaluation Record- show the employee’s
performance and are kept in the employee’s
file.
Compensation- payment employees receive for
their work. Combination of payments, benefits,
commissions, bonuses and services provided by
employers.
Equity-based compensation- helps employees
be concerned about the focus on improving the
value of the company.
Negative Inequality-comparison in which
another person receives greater outcomes for
similar outputs.
Positive Inequality- exist when an individual
feels that they have received relatively more
than others have.
Expectancy Theory- holds that people are
motivated to behave in ways that produce
desired combination of expected outcomes.
Perception plays a central role here because I
emphasize cognitive ability to anticipate
consequences of behavior.
Explains three points:
1. Person’s belief that working hard will
enable various level of task
performance to be achieved
2. Person’s belief that various work
outcomes or rewards wil result from
the acheivemnt of the various levels of
work performance
3. The value the individual assigns to these
work outcomes
Vroom’s Expectancy Theory- The streght of a t
endency to act in a certain way depends on the
strength of an expectancy that the act will be
followed by a fiven condequence (outcome)
and on the value or attractiveness of the
consequence (ourcome) to the actor.
-boils down to the decision of how much effort
to exert in a specific task situation.
Instrumentality- a performance- outcome
perception. Represents a person’s belief that a
particular outcome is contingent on
accomplishing a specific level of performance.
Valence- refers to the positive or negative value
people place on outcomes.