Contents

Introduction
Definitions of OB
Historical evolution of
OB as a discipline
Contributing disciplines
to the OB field

1 Organizational Behavior
 Introduction
 Organizations need to develop their interpersonal or
people skills for being effective.
 Organizational behavior is a field of study that investigates
the impact that individuals, groups, and structure have on
behavior within an organization, then applies that
knowledge to make organizations work more effectively.
Robbins (2003)
 OB concentrates on how to
 Improve productivity
 Reduce absenteeism and turnover
 Increase employee citizenship
 Increase employee job satisfaction

2 Organizational Behavior
  The field of organizational behavior takes extracts from
the behavioral science disciplines like psychology, social
psychology, and cultural anthropology.
 Some basic ideas included in OB are personality theory,
attitudes and values, motivation and learning,
interpersonal behavior, group dynamics, leadership and
teamwork, organizational structure and design, decision-
making, power, conflict and negotiation.

3 Organizational Behavior
 Learning Objectives

After this unit, you will be able to understand-----

Historical evolution of OB as a discipline

Contributing disciplines to the OB field

4 Organizational Behavior
 Definitions of OB
 Organizations are defined as social arrangements,
constructed by people, who can also change them.
----Buchanan and Huczynski (1997)
 Organizations are a system of cooperative activities -
and their coordination requires something intangible
and personal that is largely a matter of personal
relationships.
---- Barnard (1938)
 OB is concerned with “the study of the structure,
functioning and performance of organizations, and the
behavior of groups and individuals within them”.
---- Pugh (1971)

5 Organizational Behavior
 OB is about----
1. “the study of human behavior, attitudes and performance within an
organizational setting;
2. drawing on theory, methods and principles from such
disciplines---
3. as psychology, sociology, and cultural anthropology to learn about
individual perception, values, learning capabilities, and actions
4. while working with groups and within the total organization;
5. analyzing the external environment’s effect on the organization
6. and its human resources, missions, objectives and strategies.”

 Organizational behavior is defines as “The understanding,

prediction and management of human behavior in organizations.”
Fred Luthans

6 Organizational Behavior
 Contd.
 From the above definitions, OB can be seen as----
A way of thinking
An interdisciplinary field
Having a distinctly humanistic outlook
Performance oriented
Seeing the external environment as critical
Using scientific method
Having an application orientation

7 Organizational Behavior
 Levels of Analysis

Wood (1997) suggested that different levels of

analysis can be applied when judging the importance
of an organizational issue. He proposed eight
levels----
 Individual
 Team
 Inter-group
 Organizational
 Inter-organizational
 Societal
 International
 Global

8 Organizational Behavior
 Historical Evolution of OB as a
Discipline
 Many people have contributed to the growth of OB.
Some important contributions are-
A) Early Theorists
 1. Adam Smith’s contribution
 In the Wealth of Nations published in 1776, Adam
Smith stated that organizations and society would
benefit if they practice division of labor.
 Division of labor increased productivity by improving
workers’ skills and expertise and by saving time.

9 Organizational Behavior
 2. Work of Charles Babbage

 He added some more advantages to the list of

advantages of division of labor proposed by Adam Smith:
 It decreases the time needed to learn a job.
 It reduces wastage of material during the learning
process.
 Improves skill levels.
 It matches people’s skills and physical abilities with
specific tasks.

10 Organizational Behavior
 B) The Classical Era

Classical era covers the period from 1900 to

mid 1930s.
The main contributors during this period were
Frederick Taylor
Henri Fayol
Max Weber
Mary Parker Follet
Chester Barnard

11 Organizational Behavior
 1.Frederick Taylor
 His main focus was on finding one best way of doing a job.
 He gave importance on selecting the right people for the right
job and train them to do the job in one best way.
 His scientific principles of management highlighted the
following principles
 Shift all responsibility for the organizational work from worker to
manager.
 Use scientific methods to find the most efficient way of doing work.
 Select the best person to do the job.
 Train the worker to do the work effectively.
 Observe the performance of workers to make sure that proper work
methods are used and correct results are obtained.

12 Organizational Behavior
 2.Henri Fayol
 He was a mining engineer and a manager by profession.
 He defined the nature and working patterns of twentieth century
organizations in his book, General and Industrial Management,
published in 1916.
 In this book 14 principles of management are defined. They are----
1. Division of work – Tasks should be divided among employees.
2. Authority and responsibility – Authority is the right to give orders.
It should match with responsibility.
3. Discipline – It is necessary for proper functioning of business.
4. Unity of command – An employee should receive orders from one
superior only.
5. Unity of direction – Activities related to a single objective should be
coordinated by a single plan.
13 Organizational Behavior
 6. Subordinates of individual interest to general interest – Individual
or group goals must not take priority over business goals.
7. Remuneration of personnel – It should be fair, encourage effort
and there should be no overpayment.
8. Centralization – The extent of centralization of power of issuing
orders at the top depends on size of the organization and the
skills of its personnel.
9. Scalar chain (line of authority) – Flow of communication should
be up and down the line of authority.
10. Order – Material and personnel should be at proper place.
11. Equity – People should be treated with kindness and justice.
12. Stability of tenure of personnel – Quick turnover of people should
be avoided because it takes time to develop expertise.
13. Initiative – Employees should be encouraged to take initiatives.
14. Esprit de corps – All efforts should be made to maintain peace
and harmony within the organization.

14 Organizational Behavior
 3.Max Weber

 His theory is also known as bureaucratic theory in management.

 He described an ideal kind of organization and called it bureaucracy.
The features of Weber’s bureaucratic structure are-------
 Areas of authority should be clearly specified.
 Organizations follow principle of hierarchy where subordinates follow
instructions of superiors but have a right to appeal.
 Abstract rules guide decisions and actions.
 Officials are selected on the basis of technical qualifications.
 Employment by the organization is a career.

15 Organizational Behavior
 C) The Human Relations
Movement

1. Mary Parker Follet------

 The view that people are important to the world of
business was given by Mary Parker Follet. With this the
concept of human relations movement started.
 Follet believed that organizations should be based on
collectivism (group ethics) rather than individualism.
 The manager’s task was to coordinate group efforts.
 Managers and workers should be like partners.

16 Organizational Behavior
 2. Chester Barnard

 Barnard believed that organizations consist of people

who have interacting social relationships.
 He believed that organizations can be successful if
they cooperate with various stakeholders such as
employees, customers, investors, suppliers, etc.
 He emphasized on the need for development of skills
and motivation of employees for the success of
organization.

17 Organizational Behavior
 3. Elton Mayo

 He is known as the founder of human relations movement.

 He is also known for his research including the Hawthorne Studies
and his book ‘The Social Problems of an Industrialized Civilization
(1933)’.
 The research conducted under the Hawthorne Studies showed the
importance of groups in affecting the behavior of individuals at work.
 He found that work satisfaction depended on the social relationship
of the workgroup.
 Physical conditions and financial incentives have very low
motivational value.
 He concluded that performance depends on both social issues and
job content.

18 Organizational Behavior
 4. Dale Carnegie
 His book How to Win Friends and Influence People is
used by management experts even today.
 He believed that to succeed, an organization should
win the cooperation of its people.
 He advised------
 Make others feel important by appreciating their efforts.
 Try to make a good impression.
 Win people by being sympathetic and never telling that they
are wrong.
 Change people by praising their good qualities.

19 Organizational Behavior
 5. Abraham Maslow

 He proposed the need hierarchy theory (physiological,

safety, social, esteem and self actualization needs).
 Each step in the hierarchy must be satisfied before
moving on to the next step.
 After a need is satisfied, it does not motivate an
individual.
 The final goal of human existence is self actualization.
 Managers who accepted this theory tried to change
organization and management practices to reduce
hurdles that prevent employees from reaching self
actualization.
20 Organizational Behavior
Maslow’s
Hierarchy Self Be where you want to be
of Needs
Need for respect from others
Esteem

Need to be in a group, be loved

Social

Need for stability and consistency

Safety

Physiological Basic needs like food, water

 6. Douglas McGregor
 He gave two statements about human nature – Theory X and
Theory Y.
 Theory X put forward a negative view of people stating that this
category has
 Little ambition
 Dislike work
 Want to avoid responsibility
 Need close supervision at work
 Theory Y put forward a positive view of people stating that this
category has
 Self direction
 Take responsibility
 Consider work as a natural activity
 McGregor believed that managers should give freedom to their
subordinates to utilize their creativity and potential.

22 Organizational Behavior
 D) Behavioral Science
Theorists
1. B.F. Skinner-
 His research on classical and operant conditioning
and behavior modification affected the design of
organization’s training programs and reward systems.
 According to Skinner, behavior depends on results.
 He stated that people show a desired behavior only if
they are rewarded for it.
 A behavior is not repeated if an individual is not
rewarded or punished for it.

23 Organizational Behavior
 2.David McClelland
 His work has helped organizations to match people
with jobs and in redesigning jobs for high achievers to
motivate them.

 For example, people who have received achievement

training in India, work for longer hours, initiate more
new business ventures, make greater investments in
productive assets as compared to people who did not
receive such training.

24 Organizational Behavior
 3.Fred Fiedler
 His work in the field of leadership has a big
contribution to the growth of OB as a discipline.

 He highlighted the situational aspects of leadership

and tried to develop a complete theory of leadership
behavior.

25 Organizational Behavior
 4.Frederick Herzberg
 He tried to find answer to
the question: What
individuals want from their Hygiene Factors Motivational Factors
jobs?
 By his study, he reached a
conclusion that people
preferred jobs that provided •Company policies • Achievement
recognition, achievement,
• Quality of supervision • Career advancement
responsibility and growth.
 Only hygiene factors were • Relations with others • Personal growth
not sufficient to motivate • Personal life • Job interest
people at workplace. • Rate of pay • Recognition
 This work is important in OB • Job security • Responsibility
because it helped in • Working conditions
enriching jobs and the
quality of work life in
modern organizations.
26 Organizational Behavior
 E) OB in Present Times
Only a single theory cannot improve
organizational functioning and effectiveness.
Therefore a contingency approach is
suggested.
Today, the focus is on understanding the
situational factors and how they affect a
behavior pattern of individuals.

27 Organizational Behavior
 Contributing Disciplines to the OB Field
Organizational behavior is a behavioral science that takes
contributions from various behavioral disciplines like----
Psychology
Sociology
Social psychology
Anthropology
Political science

28 Organizational Behavior
 Psychology
 It is the science that tries to measure, explain and change the
behavior of humans and other animals.
 Early industrial or organizational psychologists were
concerned with problems of tiredness, boredom and other
factors that affect performance.
 But now, they are concerned with learning, perception,
personality, training, leadership effectiveness, etc.
Sociology
 It is the study of the social system in which the individual lives.
 It studies people with respect to their colleagues.
 Sociologists make an important contribution to OB through
their study of group behavior in organizations.

29 Organizational Behavior
 Social Psychology
 It mixes the concepts of psychology and sociology.
 It focuses on influence of people on one another.
Anthropology
 It is the study of societies to learn about human beings and their activities.
 Anthropologists work on culture and environments.
 They help in understanding differences in fundamental values, attitudes and
behavior of people in different countries and different organizations.
Political Science
 It studies behavior of individuals and groups within a political environment.
 It focuses on areas like conflict, intra-organizational politics and power.

30 Organizational Behavior
Motivation and Job Satisfaction
Why is this important?
Are you tired of unmotivated, uninterested, and inept workers?

One-third to one-half your life is spent at work!!

Theories of Motivation
Content Theories: Focus on the importance of the work
(e.g., challenges and responsibilities)
Specific needs that motivate human behavior
Process Theories: Deal with the cognitive processes used in
making decisions about our work
 Content Theories
Achievement Motivation Theory: David McClelland.
Emphasizes need to accomplish something. Linked to successful
managers
Favor environment where they can assume responsibility
Take calculated risks and set attainable goals
Need continuing recognition and feedback
Managers high in achievement motivation show more respect
for subordinates and use more participatory systems
Need Hierarchy Theory
Abraham Maslow: proposed that we have a hierarchy of
needs. Once one is fulfilled we can move on to the next
Physiological
Safety
Belonging and Love
Esteem
Self-Actualization
ERG Theory
Alderfer
Similar to Maslow. We have needs, but in this case they are
not hierarchically arranged
Satisfying a need may increase its strength
Existence Needs
Relatedness Needs
Growth Needs
Motivator-Hygiene (Two Factor)
Theory
Motivator Needs: internal to work itself. If conditions are
met, job satisfaction occurs
Job enrichment: expand a job to give employee a greater role in
planning, performing, and evaluating their work
Hygiene Needs: Features of work environment. If not met,
job dissatisfaction occurs
 Job Characteristics Theory

If employees have a high need for growth, specific job

characteristics lead to psychological conditions that lead to
increased motivation, performance, and satisfaction.
Skill variety
Unity of a job
Task significance
Autonomy
Feedback
Process Theories
Valence-Instrumentality-Expectancy (VIE) Theory: people
will work hard if they expect their effort to lead to reward
Importance of outcome determines its strength as a
motivator – supported by research
Equity Theory
Motivation is influenced by how fairly we feel we are treated
at work
Benevolent Workers: martyrs. Feel guilt when rewarded
Equity Workers: Sensitive to fairness. Normal
Entitled Workers
Goal-Setting Theory
Idea that our primary motivation on the job is defined in
terms of our desire to achieve a particular goal
Research shows that having goals leads to better performance
than not having goals
Specific goals are more motivating than general
Moderately difficult goals are most motivating
High Performance Cycle
Expands on Goal Setting Theory
Specific, attainable goals influenced by
Moderators (commitment to goal, self-efficacy, task
difficulty, feedback) and
Mediating Mechanisms (universal task strategies such as
direction of attention, effort and persistence)
 Job Satisfaction
Overall measures of satisfaction may be too broad: current
measures address different facets of job satisfaction
Overall job satisfaction rate has remained the same for over 50
years
Rates are much lower for government workers
When people say they are satisfied, they often mean they are not
dissatisfied!!
 Personal Characteristics and Job
Satisfaction

Age: in general, increases with age

Malcontents have stopped working
Older workers have greater chance of fulfillment
Gender: inconclusive results
Race: whites are happier
Cognitive Ability: slight negative relationship between level of
education and satisfaction
Personal Characteristics, Cont.
Use of Skills
Job Congruence
Personality: less alienation and internal locus of control lead
to higher satisfaction
Occupational Level: the higher the status level the greater the
satisfaction
Low Satisfaction and Job Behavior
Absenteeism: any given day 16-20% of workers miss work.
Costs businesses $30 billion dollars a year
Younger have higher absence rates
Rates are influenced by economic conditions
Turnover: Not always a bad thing!
Functional Turnover: when bad workers leave
Dysfunctional Turnover
LEADERSHIP & SUPERVISION
LEADERSHIP
Leadership
Leadership involves qualities related to a person's character and
behaviors, as well as roles within a group or organization. It
requires that a person have the ability to guide and influence
another person, group, or both to think in a certain way,
achieve common goals, or provide inspiration for change.
Marquis and Huston (2003) state that leaders:
Often do not have delegated authority, but obtain
their power through other means, such as influence.
Have a wider variety of roles than do managers.
May not be part of the formal organization.
Leadership Styles

Autocratic
Democratic
Laissez-faire
Situational
Autocratic Leadership
A leadership style characterized by specific instructions to
employees regarding what, how, and when work should
be done.

•Micro-management style
•The leader plans, organizes, controls, and
coordinates.
•Emphasis is on getting the job done without
regard for input from others.
Autocratic Leadership (cont.)
 Advantages
 Efficiency
 Employees know the manager’s expectations.
 Disadvantages
 Discourages employees from thinking about process
improvements
 Employee dissatisfaction
 Decline in worker performance
 Does not prepare employees for promotion or possible
advancement
Autocratic Leadership (cont.)
 When to use the autocratic
style
During an emergency
Managing temporary
employees
Managing new
employees
Democratic Leadership
A leadership style characterized by encouragement for
employees to share in the decision-making and problem-
solving processes.

•General management style

•Considers everyone’s viewpoint in
decision making
•Utilizes team concept in goal setting
Democratic Leadership (cont.)
Advantages
Employees actively involved in decision making
Higher employee morale
Stronger employee commitment to established
goals
Disadvantages
Time consuming
Not everyone likes to participate in decision
making.
Democratic Leadership (cont.)

 When to use the democratic

style
 Managing employees who are
committed to their jobs
 Managing employees who are
interested in more
responsibility
 Managing experienced and
well-trained employees
Laissez-faire Leadership
A leadership style in which minimal direction and
supervision is given to workers.

•Open management style

•Management shares information
•Team (or individual employee) is
completely responsible for the
workload.
Laissez-faire Leadership (cont.)
Advantages
Easy management style to administer
Complete empowerment for employees
Disadvantages
Poor decision making may result.
Some employees do not perform well without
direction and supervision.
Laissez-faire Leadership (cont.)
When to use laissez-faire
Managing experienced,
well-trained, and highly-
motivated workers
Managing home-based
employees, outside
salespersons
Situational Leadership
Leadership characterized by shifts in management style as
appropriate for individual employees.

•The management
style applied
depends on the
needs of each
employee.
Situational Leadership (cont.)

Advantages
Management style personalized for each
employee
Improved communication
High employee morale
Improved production
Disadvantages
Time consuming
Difficult to manage
Situational Leadership (cont.)
 When to use situational
management
 Highly experienced manager
 Manager highly skilled in human
relations
 Employees with range of needs
for supervision
Supervision
 The Art & Craft of Supervision

The Art The Craft

Interpersonal Technical
and Conceptual Skills
Skills
Making the Transition
Find out what management expects of you.
Establish your authority.
Get to know your operation.
Get to know your people.
Communicate your expectations.
DON'T DO IT!
 Playing favorites.
 Doing the work. Let your employees be the technical workers.
 Being emotional.
 Lying your way out of things.
 Trying to be "One of the Gang."
 Taking credit for your employee's successes.
 Blaming management for problems.
 Selling out your employees.
 Refusing to make a proper commitment to the job.
 Neglecting to grow into the job.
Qualities of Supervisors
 Goal oriented
 Bottom line oriented
 Communicates and enforces standards
 Initiative – seeks opportunities to solve problems
 Skillful use of influence
 Communicates confidence
in people
Qualities of Supervisors (continued)
 Interpersonal sensitivity
 Develops and coaches others
 Gives performance feedback
 Collaboration and team building
 Conceptual skills and systematic
problem solving
 Concern for image and
reputation
Supervisor Definition
Supervisor has its roots in Latin, where it means “Looks
Over”

Super which means Very Good and Vision which means

Detailed Focus.
What Is Supervision?
Supervision is the first level of management in an
organization

Supervisors do not do operative work, but see that it is

accomplished through the effort of others
Who are Supervisors?
A supervisor is the manager who serves as the link between
operative employees and all other managers
Five Attitudes for Successful
Supervision
I'm
A member of management
Responsible for the performance of my entire team
Easy to work for
Easy to get along with
Able to forgive myself for mistakes
 The Functions of Supervision
Determining how well the work is being
done compared to what was planned
Controlling

Directing & channeling

employee behavior Leading

Obtaining & developing Staffing

good people

Distributing the work & arranging

Organizing
it so that it flows smoothly
Planning
Determining the most effective
means for achieving the work
The Functions of Supervision
3 types of skills required of supervisors:
Technical:
 Knowledge about machines, processes, and methods of production
Human relations:
 Knowledge about human behavior and the ability to work well with
people
Administrative:
 Knowledge about the organization and how it works
Skills & Levels of Management
What Factors Affect Behavior?
 Policies
 Peer group
 Media
 Difference of ethics taught and ethics observed
 External influences
 Family
 Religious
 Cultural
 Political
Supervisor’s Responsibility
Know and understand values of the department,
subordinates, self.

Demonstrate integrity.

Instruct, monitor, correct behaviors in subordinates.

Ethics In The Workplace
Employees’ ideas of what is acceptable and not acceptable are
based on the supervisor’s actions
The supervisor’s failure to take corrective action in certain
situations can also affect the behavior of the employees
Areas Requiring Ethical Conduct
 Loyalty
 Supervisors who are viewed as being interested only in themselves and their
future will have difficulty in getting the full cooperation of employees
 Human relations
 This category centers on the supervisor’s concept of fairness, particularly in
the treatment of subordinates
 Overt personal actions
 This category includes the supervisor’s behavior within the company and
how they handle themselves in the community
Dealing with Dishonest Employees
A. Dealing with dishonest subordinates
1. Recognize the problem, get the facts, and document the case
2. Confront the employee
3. Follow the established disciplinary system
B. Dealing with dishonest peers or other managers
1. You may not be able to deal directly with the problem
2. In most cases, report your suspicions and findings to your boss and let them
confront those involved
B. Whistle blowing
1. Whistle blower places himself or herself at risk