004 Core 8 - Organizational Behaviour - III Sem BBA

STUDY MATERIAL FOR BBA
ORGANIZATIONAL BEHAVIOUR
SEMESTER – III, ACADEMIC YEAR 2020-21
UNIT CONTENT PAGE Nr
I ORGANISATIONAL BEHAVIOUR 02
II INDIVIDUAL BEHAVIOUR 10
III PERCEPTION 27
IV LEADERSHIP STYLES AND THEIR IMPLICATIONS 44
V ORGANISATIONAL CULTURE 64
Page 1 of 77
UNIT - I
ORGANISATIONAL BEHAVIOUR
Organizational Behavior (OB) is the study of human behavior in organizational settings,

the interface between human behavior and the organization, and the organization itself.
Nature and Importance of OB:

Organizational Behavior is a recent origin and developing as a separate field of study. It
has properly progressed in the latter half of the twentieth century. Its present nature may be
discussed as under.
1. A separate field of study: Organizational Behavior is a separate field of study. Many

researches and analysis have been done in this field. But it is not still accepted as a
science. There is no foundation of basic concepts that may guide its development as a
science. Therefore, it will be appropriate to call it a field of study rather than discipline.
2. It is an applied science: The aim of OB it to solve problems of organizations related with

human behavior aspect. Therefore, applied researches are concentrated, in place of
fundamental researches. Though many of the researches may be carried in laboratory,
but the behavior of an individual cannot be analyzed so. Therefore, Organizational
Behavior is both science as well as art.
3. An Interdisciplinary Approach: Organizational behavior is essentially an interdisciplinary

approach to study human behavior at work. It tries to integrate the relevant knowledge
drawn from related disciplines like psychology, sociology and anthropology to make
them applicable for studying and analyzing organizational behavior.
4. A Normative Science: Organizational Behavior is a normative science also. While the

positive science discusses only cause effect relationship, O.B. prescribes how the
findings of applied researches can be applied to socially accept organizational goals.
Thus, O.B. deals with what is accepted by individuals and society engaged in an
organization. Yes, it is not that O.B. is not normative at all. In fact, O.B. is normative as
well that is well underscored by the proliferation of management theories.
5. A Humanistic and Optimistic Approach: Organizational Behavior applies humanistic

approach towards people working in the organization. It, deals with the thinking and
feeling of human beings. O.B. is based on the belief that people have an innate desire to
be independent, creative and productive. It also realizes that people working in the
organization can and will actualize these potentials if they are given proper conditions
and environment. Environment affects performance or workers working in an
organization.
6. A Total System Approach: The system approach is one that integrates all the variables,
affecting organizational functioning. The systems approach has been developed by the
Page 2 of 77
behavioral scientists to analyze human behavior in view of his/her socio-psychological

framework. Man's socio-psychological framework makes man a complex one and the
systems approach tries to study his/her complexity and find solution to it.
Importance
a. OB provides a road map to our lives in organizations.

b. The field of 08 uses scientific research to help us understand and predict organizational
life.
c. OB helps us influence organizational events.
d. OB helps an individual understand himself/herself and others better.
e. A manager in a business establishment is concerned with getting things done.
f. OB is useful for maintaining cordial industrial relations.
Process of OB:
OB and Management:
Organizational behaviour is a broad field comprised of many subject areas. Work
behaviours are typically examined at different levels-‘individual behaviour, group behaviour,
and collective behaviour across the organization with different issues salient at each level.
Studying individual behaviour helps managers understand how perceptions, attitudes, and
personality influence work behaviour, motivation, and other important work outcomes, such as
satisfaction, commitment, and learning. Examining interactions in the group setting provides
insight into the challenges of leadership, teamwork, communication, decision making, power,
and conflict. Studying organization-Wide behaviour (sometimes referred to as organization
theory) helps explain how organizations structure work and power relationships, how they use
systems for decision making and control, how an organization’s culture affects behaviour, how
organizations learn, and how they adapt to Changing competitive, economic, social, and
political conditions.
Page 3 of 77
Hawthorne Studies
1. Illumination Experiments. (1924 -27)
2. Relay Assembly Test Room Experiment. (1927 -28)
3. Mass Interviewing Programme. (1928 30)
4. Bank Wiring Observation Room Experiments. (1931 32)
1.Illumination Experiments:
This research was conducted to determine the effects of changes in lighting on
productivity. The basic assumption of this research was that high lighting leads to productivity.
This experiment was conducted for two and a half years.
Under this experiment, two groups were formed. The first group was termed as
experimental group and the second group was termed as control group. In the case of
experimental group, variations in lighting were made periodically and the results were
observed and recorded. In the case of control group, there is no change in the lighting and the
researchers were required to work under constant lighting system up to the end of the
experiment. Interestingly, it was observed that the output of both groups increased steadily.
This experiment revealed that there is no relationship between lighting and

productivity. The production decreased in two groups whenever the lighting falls below the
normal level. The production is not affected in any way in the experimental group when the
light is decreased up to the level of moon light. It means that the improved working conditions
do not result in the increased productivity. As per this experiment, it is known that informal
social relations among the group members are the reason for increased productivity.
2.Relay Assembly Test Room Experiments:

Relay assembly test room experiments were conducted to determine the effect of
changes in working conditions and productivity. These experiments had been conducted in
three phases i.e. First Relay Assembly Test, Second Relay Assembly Group and The Mica
Splitting Group.
Under this experiment, a group was formed. This group consisted of six girls. The girls
were chosen on the basis of their past performance. The girls were placed in a separate test
room. An observer was associated with the girls to supervise their work. The girls were told to
work in natural way and allowed to comment freely about changes in the working conditions.
The changes were made with durations ranging from four to twelve weeks. Whenever a change
was introduced, the girls were allowed to express their views and Opinions. At times, the girls
were allowed to take decisions themselves. Periodical training was conducted for the girls.
Group bonus incentive scheme was the first change made under this experiment. The
productivity increased to some extent as compared to the previous one. The changes in the
variation of rests were the second one. There are two five minutes rests one is in the morning
and another one is in the evening. Then, five minutes was increased to ten minutes. The
productivity increased.
Page 4 of 77
Free snacks and coffee or soup were provided in the rest time of two ten minutes
duration. This was the third change. The productivity was increased at this stage.
Now, free snacks and coffee or soup were withdrawn but the number of rest period’
was increased into four each with five minutes duration. The productivity decreased slightly. It
was found that the decreased productivity was due to frequent rest intervals and not because
of withdrawing free snacks and coffee or soup. The group has complained that frequent rest
intervals affect smooth flow of the work. So, the number of rests intervals was reduced to two
of ten minutes duration each and provided coffee or soup in the morning and snacks in the
evening. The productivity increased by as much as 30 per cent.
The introduction of changes in working hours and workday is the fourth stage. Saturday
work will be eliminated and half an hour will be cut in the working hours. It was found that the
productivity increased.
At this stage, the researcher decided to withdraw all benefits and facilities offered to
the group girls, i.e., rest and other benefits. This is the fifth and last stage of Relay Assembly
Test Room Experiments. It was found that, interestingly, productivity increased further instead
of going down.
As and when the change was introduced, it was found that absenteeism decreased; the
morale increased among the group girls and the needed supervision lessened. Since, the group
girls were allowed to work freely; they developed a sense of responsibility and self discipline. A
close and friendly relationship prevailed between the supervisor and the group girls.
Thus five changes were introduced in the working conditions over a period of two years.
But, the method of payment was not changed. Morale and productivity were maintained, even
though the improvements or changes in working conditions were withdrawn. The research
implied that productivity increased not because of improved working conditions, i.e., positive
changes in physical factors but because of socio-psychological factors such as the feeling of
being important, recognition, attention, complete communication, participation, small size of
the informal cohesive work group and non-directive supervision. Therefore, Elton Mayo
concluded that the work satisfaction depends to a large extent on the informal social pattern of
the work group. Where norms of cooperativeness and high output are established the feeling of
importance and physical conditions has little impact.
3.Mass Interviewing Programme:

This interview programme was conducted to determine employee’s attitudes towards
company, supervision, insurance plans, promotions and wages. Nearly 20,000 employees were
interviewed, many of whom were interviewed more than once. This interview programme was
started on September 1928 and ended on February 1929.
Page 5 of 77
Initially, the interviews were more or less structured. Only direct questions were asked
by the researchers. So, the researchers were not able to find the grass root of the problem.
Hence, the interview method was changed into non-directive interview or unstructured
interview. Under the non-directive interview method, the interviewer was asked to listen to
instead of talking, arguing or advising. Besides, the employees were asked to discuss freely
those issues which are relevant to the topics of their own choice. Here, the term employees
include supervisors also. So some interview was conducted for supervisors also.
The interview programme brought to the lime light many valuable insights about
employees attitudes to the company. Some of the major findings are given below:
1. Supervisors knew what was expected of them by the workers working under their
control.
2. Male workers were more economically oriented than the female workers.
3. A complaint of a worker is a symptom of personal disturbance in the working Place‘
4. Many problems of worker management co-operation were the result of emotional
attitudes of workers rather than of objective difficulties in the situations.
5. A satisfaction or dissatisfaction of an employee comes from his social status and
expected social rewards.
6. The personal situation of the worker is arising out of mode of arrangement of his
sentiments, desires and interests.
7. The position or status of a worker in a company gives a basis to the events, objects and
features of his hours of work and his wages.
8. A morale booster for the workers has been developed by the process of paying
attention to the views by the management.
9. A social demand for a worker is influenced by gaining experience both inside and
outside the working place.
10. The individual behavior was being influenced by group behavior.
11. According to Mayo, “the workers were activated by logic of sentiment but the
Management is concerned with logic of cost and efficiency.” Thus, a conflict between
the workers and the management becomes inevitable.
4.Bank Wiring Observation Room Experiments:

This experiment was conducted between 1931 and May 1932. A group has been formed
to conduct this experiment. This group consisted of fourteen male workers. Out of these
fourteen male workers, nine were wiremen, three were soldier men and two were inspectors.
The main aim of this experiment was to analyze how a group could influence a worker
to restrict his output even in the face of attractive incentive schemes for larger output. Hourly
rate of wages was fixed on the basis of average output of each worker and a group bonus
scheme was announced. Group Bonus was to be determined on the basis of average group
output. It was assumed that workers would produce more and more in order to get maximum
group bonus. Besides, the workers could help each other to produce more.
Page 6 of 77
The company had not improved the working conditions for this experiment and the
company was not ready to analyze cause effect relationships. But, a general observation was
made to know about an individual behavior and the impact of group behavior on the individual
behavior.
Under this experiment, workers have decided their target by themselves. The company
target was more than the target fixed by the workers. However, the workers have failed to
achieve the target due to the following reasons
1. Unemployment Problem:
Workers feel that if they produce more, a few workers among them would be put out of
employment.
2. Unduly High Standard:
Most of the workers were of the view that if they had reached the standard level of
production, the management would raise the standard level of production still more
unscrupulously.
3. Protection of Slow Workers:
The workers were friendly on the job as well as off the job. They told that the fellow
workers have responsibility which required them to remain in the job. So, the fast workers
protected the slow workers by slowing down their production. If they did not do so, slow
workers were likely to be retrenched.
4.Satisfaction of Management:
Workers were confident of the management accepting lower production. In other
words, management seemed to accept the lower production rate and no one was being
punished for lower production.
Bank Wiring observation room experiments helped to arrive at the following
conclusions.
1. An informal relationship is responsible for deciding the human behavior.

2. The counseling was helpful in resolving management-employee conflicts.
3. The existence of informal organization is quite common in all organizations.
4. The group had fixed standard output of their own only because of social pressure.
5. The output could not increase despite group incentive scheme as a result of existence of
social pressure.
System Approach to Management

FEATURES OF MANAGEMENT AS SYSTEM
Management is regarded as a system, under the systems approach, on account of the
possession of the following features.
1. Social System:
Management is a social system since the management has all the characteristics of
social system. To be a social system, the management has many divisions (many sub-systems)
which are integrated to constitute an entity.
Page 7 of 77
2. Open System:
Management has the interaction with the environment. Management takes various
resources, allocates and combines these resources to produce desirable outputs which are
exported to the environment. Therefore, it is understood that management has no freedom to
decide the things on its own. But, at the same time, due weightage has to be given to the
environmental factors affecting the management of an organization.
3. Adaptive:
Adaptive means continuous adjustment to changing environment for survival. The
management has made internal modification of organizational functioning to meet the needs of
the changing world. The internal modification is made on the basis of feedback mechanism.
4. Multidisciplinary:
Management draws and integrates knowledge from various disciplines and schools of
thought like economics, psychology, sociology, anthropology, mathematics, statistics and so on.
It takes only the relevant aspects from these disciplines and the integration of relevant
knowledge from these disciplines.
5. Dynamic:
Always, management moves towards growth and expansion. For which, there is a need
of effectiveness of management. Both, internal processing process and interaction with
external environment are determining the effectiveness of management.
6. Integrated Approach:
Happening of an event is due to many factors. Management tries to identify such factors
and reasons. At the end, management tries to integrate the various factors to find out the
reasons behind an event.
7. Probability:
Management has the character of probability. The reason is that the outcome of an
action can be predicted accurately to some extent in management. For example There is a pay
cut for an unauthorised absent. If so, nobody absent without prior permission: Hence, the
management can make forecast very clearly to a certain degree.
8. Multivariable:
There is no simple and single cause effect phenomenon. Generally, an event may be the
result of so many variables. These variables themselves are interrelated and interdependent.
9. Multidimentional:
Management has both macro and micro approach. At macro level, the whole business
organisation is taken into consideration for approach. At micro level, part of a business
organisation is taken into consideration for approach. Thus, both parts and whole are equally
important in managing.
Page 8 of 77
EVALUATION OF SYSTEMS APPROACH

Systems approach helps in studying the functions of complex organisation and bring out
the interrelationship prevailing among the various functions like planning, organizing, directing
and controlling. It highlights inter-dependence between different elements of an organisation
as well as between an organisation and its environment. Under this approach, a problem is
analysed in relation with other problems. Likewise, no problem is analysed in isolation. Systems
approach provides clues to the complex behaviour of people in an organisation.
This approach cannot be easily applied to large and complex organisations. At the same
time, there is no tools and techniques provided to the managers. It cannot directly and easily be
applied to practical problems. Systems approach is not suitable for small organisations. Looking
into these short comings of systems approach, researchers and management experts have tried
to modify the systems approach. Hence, situational or contingency approach is emerged.
Page 9 of 77
UNIT - II
INDIVIDUAL BEHAVIOUR
Individual behavior can be defined as how an individual behaves at work. A person’s

behavior is influenced by the following factors
1. Attitude
2. Perception
3. Personality
4. Stress
5. Belief
6. Norms or other psychological matters
The factors influencing individual behavior are –
1. Perception − It is the result of various senses like feeling, seeing, hearing etc.
2. Attitude − we can either have a positive attitude or negative attitude, like i like my
job is expressing a positive attitude towards my work.
3. Personality − For example, some people seem to be very friendly, while there are
some who take time to open up.
4. Values and marks individual’s decision
making process.
5. Emotions − There are happy moments we cherish and the sad moments like anger,
frustration, etc. that we try to forget.
Factors influencing individual behavior inside the Organization (process and causes)
PERSONAL FACTORS
Personal factors, as shown in Fig. 5.1, include age, sex, education, abilities, marital
status creativity, emotional intelligence and number of dependents.
Age:
The issue of age is multifaceted and individualistic. It has impact on performance
Turnover, absenteeism, productivity, and satisfaction.
Performance is dependent on age. As age advances, performance is likely to decline.
Similarly aging aso has an impact on turnover. The older one grows, the less likely one is to quit
the job. Age-absence relationship depends on whether absenteeism is avoidable or
unavoidable Generally, older employees have lower rates of avoidable absence than do
younger employees However, they do have high rates of unavoidable absence. This is probably
because of p! health associated with old age. With regard to productivity, old age results in
reduced productivity. This is because of the decline in an individual's skill as he or she grows
older in age.
Page 10 of 77
There is a positive association between age and satisfaction. However, changes in

technology may after this equation. In jobs where workers are subject to dramatic changes
causing their skills to become obsolete, such as those affected by computerisation, satisfaction
levels of older employees tend to be lower than that of younger ones.
Age can also be a factor in adaptability, although it would be incorrect to stereotype all
older people as adaptable.
The impact of age goes beyond organisational factors. Gender for example, like age,
forms, the basis for social differentiation. The status of 'older persons in society frequently
influences our perception Societies often get stratified by age and this stratification varies from
culture to- culture. One society may treat older people with great reverence, while another
sees them as unproductive' and 'difficult. The Sherpas a Tibetan-speaking, Buddhist people in
Nepal- idolise their elders. Almost all elderly members of the Sherpa community own houses
and enjoy good health. Similarly, in the Andaman Islands, old people hold dominant positions in
the social structure.
Not all societies, however, have a tradition of caring for and valuing the elderly. Among
the Fulanis of Africa, older men and women move to the edge of the family homestead. Since
this is where people are buried, the elderly actually sleep on their graves, for they are already
considered as dead. Some societies are known to have practised silicide - the killing of the aged
because of extreme difficulties in providing basic necessities such as food and shelter.
Sex:
Page 11 of 77
The issue of male and female employees has received considerable attention from
academics, sociologists, and researchers. Research has proved that problem-solving ability,
analytical skill, competitive drive, motivation, leadership, sociability, or learning ability are not
gender-dependent. However, in our male-dominated society, the presence of women
employees in organisation is not appreciated or encouraged.
Sex also has an impact on turnover and absenteeism. It has been proved that the
tendency to change jobs and to abstain from work is likely to be higher among female than
among male Employees. The most logical explanation for this phenomenon is that our society
has historically placed home and family responsibilities on the female. When a child is ill or
someone needs to stay home to await the plumber, it has traditionally been the woman who
has taken time off from work to attend to these needs.
Education:
This has its effect on individual behaviour, largely through the level and type of
education received Increased levels of education serve to increase an individual's expectations
about positive outcomes These outcomes are generally perceived to be a more satisfying job,
higher income level, and greater alternative sources for occupational choice, i.e, the good life
Disillusionment occurs when outcomes do not match expectations
The type of education received can also affect individual behaviour. Education can be
general or specialised. The former includes areas like arts, humanities, and social sciences
whereas the latter covers disciplines such as engineering, medicine, computer science, and the
like. Generalist education tends to both attract and develop individuals differently the
education in the specialities. Specialist programme tend to be relatively narrow and focus
whereas generalist programmes expose individuals to a broad range of subjects designed to
enhance an overall understanding of concepts and issues.
Ability:
It refers to an individual's capacity to perform various tasks in a job. The ability of an
individual is made up of two sets of skills - intellectual and physical.
Intellectual abilities are needed to perform mental activities. IQ tests,for example, are
designed to ascertain one's intellectual abilities. So, too, are popular college admission test like
GRE GMAT, and CAT Some of the more relevant dimensions making up intellectual abilities
include number aptitude, verbal comprehension, perceptual speed, and inductive reasoning
Table 5.1 describes these dimensions. (Next Chapter carries more details on intelligence
Physical abilities manifest in one's stamina, manual dexterity, leg strength and the like.
Management must identify an employee's physical abilities if these are the major inputs require
to perform a task.
Nine basic physical abilities (See Table 5.2) have been identified. Individuals differ in the
extent to which they have each of these abilities. Not surprisingly, there is also little
Page 12 of 77
relationship between them. A high score on one is no assurance of a high score on the others.
High employee performance is likely to be achieved when management has ascertained the
extent to which a job requires each of these nine abilities and then ensures that employees in
that job have them
Ability-job fit:
It is widely known that employees differ in their physical and intellectual abilities and
the jobs they perform demand varied abilities. Employee performance is enhanced where there
is high ability-job fit.
A perfect ability-job fit is seldom achieved. For one thing, hiring procedures are often
imperfect Managers direct their attention at only the employee's abilities or only the ability
requirements of the job and ignore the fact that employee performance depends on a fit
between the two. Moreover, people and organisations change. An employee who finds a new
job stimulating and exciting to begin with, may find the same job boring and monotonous a few
years later. An organisation that adopts new technology needs new skills from its employees.
Finally, each person is unique. Measuring skills and performance is quite difficult. Assessing
attitudes and personality is far more complex. Each of these makes matching abilities with jobs
a difficult and complex process.
What happens when the fit is poor? If the employees are short of the required abilities,
they are likely to fail. Performance suffers, even if the employee is highly motivated and has a
positive attitude. If the employee abilities far exceed the job requirements, the consequence
will be different. Job performance is likely to be adequate, but there will be organisational
inefficiencies and possible decline in job satisfaction.
Marital status:
This has an influence on absenteeism, turnover, and satisfaction. Married employees
have fewer absences, undergo less turnover, and are more satisfied with their jobs than the
unmarried ones. Marriage imposes additional responsibility, hence the need for a steady job
and steady income.
Number of dependants:
There is correlation between the number of dependants an employee has and his or her
absences and satisfaction. The number of children an employee has is positively related to
absence, especially among females. Similarly, there is positive correlation between number of
dependants and satisfaction.
Creativity:
This is yet another personal factor that influence individual behaviour Creativity refers
to the cognitive activity that results in a new or novel way of viewing or solving a problem.
Creativity is highly desirable, as it is from creativity that major inventions, scientific
breakthroughs and great works of music literature, and art emanate.
Page 13 of 77
Creative individuals possess at least three categories of attributes, background

experience, personal traits, and cognitive abilities.
Background experience matters much to make an individual creative. It is well

understood that creative individuals were raised in environments that nurtured creativity.
Pierre and Marie Curie, great scientists in their own right raised a daughter Irene, who won the
Nobel Prize in Chemistry. Thomas Edison's creativity was nurtured by his mother.
Personal traits have also been linked to creativity in individuals. The traits shared by
most creative people are openness; an attraction to complexity; high levels of energy;
independence and autonomy: high level of self-confidence, and a strong belief that one has, in
fact, creative abilities. Individuals, who possess these traits, tend to be more creative than
those do not.
Cognitive abilities are an individual's power to think intelligently and to analyse

situations and data effectively. Intelligence is a precondition for creativity. Creativity also
depends on one's ability to think divergent and convergently about events. Convergent thinking
enables him or her to perceive similarities between situations or events. Creative people are
generally skilled both in divergent and convergent thinking.
Organisations seek to promote creativity by making it a part of their culture. Firms that
truly want to stress creativity state as goals that some percentage of future revenues are to be
generated from new products. This clearly communicates that creativity and innovation are
valued.
Firms also seek to enhance creativity by rewarding creative success, but care is taken to
avoid punishing creative failures. Punishing an employee for failure of his or her creative idea
discourages others from coming out with innovative thinking.
Emotions and Emotional Intelligence:

Emotions are an affective state of consciousness in which joy, sorrow, fear, hate, love,
surprise and anger are expressed. These are part of one's personality and he or she carries
them to the workplace. And their impact on one's workplace behaviour is considerable.
Emotions are a private affair. No individual is willing to share his or her emotions with others.
Yet, we are able to recognise the presence of various emotions in others, and we are able to
communicate your own feelings to them as well.
Four features are common to all emotions:

1. Emotions are highly focused They have an object towards which emotions are
expressed. For example, we love a person, our anger is towards a person, and we hate a
specific individual.
2. Expression of emotions is universal - People across the globe exhibit similar body
language to express same emotions. Facial expression to exhibit joy is same irrespective
of the fact that the person is an Indian, Chinese or Japanese.
Page 14 of 77
3. Culture determines expression of feelings-Notwithstanding the fact that people exhibit

identical behaviour to express similar emotion, culture of each society determines
display norms to exhibit feelings. Italian culture, for example, emphasises high
expressiveness, but it is a taboo in Thailand.
4. Six major categories of emotions have been identified - Anger, fear, joy, love, sadness
and surprise. These are universal.
Each of these emotions is exhibited (tempered by culture) in a given way. Love, for
example, is expressed through smile, excitement, eagerness, anxiety and pleasantness writ
large on the face, and anger is seen from the frowning face. How to express emotions while
communicating online? People in the recent years have developed ingenious ways to
expressing emotions through e-mail messages. Known as emoticons (short for emotional icons),
these are created by typing characters such as commas, hyphens, and parentheses, which are
viewed by tilting one's head to the left (treating left as top).
The most common emoticons are as follows

 :-) smile
 :-( frown
 ;-) wink
But the problem with emoticons is their overuse by communicators. Another issue
related to their ineffectiveness in communication what the sender really wanted to convey.
Consequently, the impact of emoticons has declined over time
Mood:
Moods are related to emotions. While emotions are focused and intense, moods are
feelings that are diffuse. More specifically, a mood is understood as a feeling that is unfocused,
and relatively mild in intensity. For example, one can say that he or she is in a good mood or
bad mood. But this is not as focused and intense as saying that the individual is experiencing
anger or sadness. In addition, moods tend to fluctuate rapidly in a given day. A favourable
opinion from the boss may make the employee entertain a good mood. A harsh criticism, the
next moment on the next day, is likely to put the same person in a bad mood. But emotions
tend to endure. Love or sadness is likely to stay longer than a good or a bad mood.
Impact on Performance:
How do emotions and moods impact job performance? It is being observed that
emotions may not have any impact on performance. An individual beset with anger, joy or
sadness is likely to focus more on the feeling than on improving performance. The distance
between emotions and performance is more where there is negative impact of emotions. An
angry employee (because he or she received poor rating from the boss) is unlikely to show any
improvement in performance.
With regard to moods, there is correlation between them and performance. This is
proved in at least three ways: (i) mood strongly influences the ent to which people help each
Page 15 of 77
other, co-operate with each other, and refrain from exhibiting aggressive behaviour towards
others, moods also influence one's attitude towards work of self as well as of others, and (ii)
moods help recall past events and actions. For example, an individual is likely to recollect
positive things about the job, the boss and the environment, if he or she starts the day with a
good mood. Quite contrary happens when he or she starts the day with a bad mood.
Emotional Intelligence:
Emotional intelligence (Ei or EQ) is concerned with an individual's emotional and social
skills, EI helps us monitor and shape our emotional responses and those of others. The concept
of El was popularised by Daniel Goleman in 1995. EQ has the following dimensions:
1. Emotional attainment or self-awareness, and people skills. The person is good at reading
his or her own feelings, has the capacity to empathise with others and take into account
other people's feelings.
2. Emotional management. This is reflected in ensuring that the person's emotions (joy,
love or anger) do not overwhelm him or her, and that they are appropriate to the
situation. It can be seen as an ability to cheer oneself up, or stop a temper tantrum in
mid-course by going out for a walk, for example.
3. Using emoticons. A capacity to weigh up the emotional aspects of values and attitudes
when confronting problems and making decisions.
4. Self-motivation. This refers to an individual's propensity to delay gratification. It has
been observed that an individual who is capable of delaying gratification - ie, waiting a
while to take a reward than taking it immediately - is more socially competent and self-
reliant than a person who settles for immediate rewards.
Yet another foundation that impact an individual's behaviour is his or her identity.
Distinction is made between personal identity and social identity. Personal identity is the
product of one's appearance, personality, special skills and interests. Social identity of the
person comes from the group, from the company and from a university to which he or she
belongs. Personal identity is person specific, but social identity is what is derived from others.
LEARNING - EXPLICIT AND TACIT KNOWLEDGE

When employees learn, they acquire both explicit and tacit knowledge. Explicit
knowledge is organised and can be red from one person to another. The information a student
receives in a classroom is mainly an explicit knowledge because the professor packages and
consciously transfers it to the students. Explicit knowledge can be written down and given to
others. However, explicit knowledge is only a small portion of the total knowledge.
Majority of the people have tacit or implied knowledge. Tacit knowledge is the idea that
and knows more than what he or she can tell. Implied knowledge is embedded in our actions
and ways of thinking, but is not clearly understood and therefore cannot be communicated
explicitly. The knowledge and skills one wants to give others are not my w so they cannot be
Page 16 of 77
communicated through verbal messages. Further, since implicit knowledge is not documented,
it is quickly lost when employees leave the organisation.
Tacit knowledge is acquired through observation and direct experience. For instance, a
truck driver does not learn how to operate the vehicle through lectures. He masters the
necessary skills by watching the subtle details as others perform the tasks, and by directly
experiencing is complex interaction of behaviour with machine's response. Similarly,
Organisations acquire tacit knowledge when employees experiment with new technologies or
work on unique problems for clients. Most knowledge in organisations is tacit and one of the
challenges in knowledge management is to make implicit knowledge explicit so that it may be
stored and shared more easily.
HOW LEARNING OCCURS?

There are four theories which explain how learning occurs. They are Classical
conditioning, (in Operant conditioning, (ii) Cognitive theory, and (iv) Social Learning theory. (Fig.
Classical Conditioning
Classical conditioning is based on the premise that a physical event- termed as, stimulus
- that initially does not elicit a particular response gradually acquires the capacity to elicit
response as a result of repeated pairing with a stimulus that can elicit a reaction. Learning type
is quite common and seems to play an important role in such reactions as strong aversions,
Page 17 of 77
some aspects of sexual behaviour, and even racial or ethnic prejudice conditioning became the
subject of careful study in the early 20 century, when Ivan Pavlov,a Nobel prize-winning
psychologist from Russia, identified it as an important behavioural process.
Pavlov conducted an experiment on a dog and tried to relate the dog's salivation and
the ringing of a bell. A simple surgical procedure allowed him to measure accurately the
amount of saliva secreted by the dog. When Pavlov presented the dog with a piece of meat the
dog exhibited a noticeable increase in salivation. When he withheld the presentation of meat
and merely rang a bell, the dog has no salivation. Then Pavlov proceeded to link the meat and
the ringing of the bell. After repeatedly hearing the bell before getting the food, the dog began
to salivate as soon as the bell rang. After a while, the dog would salivate merely at the sound of
the bell, even if no food was offered. In effect, the dog has learnt to respond salivate (salivate)
to the bell.
From the brief description given above, certain key concepts of classical condition can
now be introduced. Salivation in response to food is a natural, unlearned response- in short a
reflex. This response was called the unconditioned reflex. The food, because it elicited the
unconditioned reflex automatically, was called the unconditioned stimulus. When Pavlov's
repeated presentation of the bell followed by food led the dog to salivate in response to the
bell alone, this salivation was designed as conditioned reflex, which emphasised that arousal of
the reflex was dependent upon a stimulus, as the conditioned stimulus. Thus, the concept
central to classical conditioning are unconditioned stimulus (US), unconditioned response (UR),
conditioned stimulus (CS), and conditioned response (CR)
Page 18 of 77
The relationship among these components of classical conditioning is shown in Figure 9.2.
The essential feature of this process is that a previously neutral stimulus acquires the
capacity to elicit a certain response, which is then called a conditioned response.
In an organisational setting, we can see classical conditioning operating. For example, at
one manufacturing plant, every time the top executives from the head office would make a
visit, the plant management would clean up the administrative offices and wash the windows.
This went on for years. Eventually, employees would turn on their best behaviour and look prim
and proper whenever the windows were cleaned even in those occasions when the cleaning
was not paired with the visit from the top brass. People had learnt to associate the cleaning of
the windows with the visit from the head office.
Classical conditioning is best observed in the police department, particularly in police
personnel regulating a kile w be manned with inspector, sub-inspectors or constables to control
movement of vehicles and pedestrians. During peak hours, an Asst. Commissioner of Police
(ACP), who is in overall control of traffic, goes round the city and monitor way the traffic is
being regulated. It is the practice of the personnel under the ACP, to salute whenever he passes
by in his vehicle. The police at the circles are so used to saluting their that they do so even
when only the vehicle passes without the ACP being seated inside.
Despite the theoretical possibility of the widespread applicability of classical
conditioning, most modern theorists agree that it represents only a very small part of total
human learning. skinner, in particular, felt that classical conditioning explains only respondent
(reflexing) behaviours. These are the involuntary responses that are elicited by a stimulus.
Skinner felt that more complex human behaviours cannot be explained by classical conditioning
alone. He felt that most human behaviour affects, or operates on, the environment. The latter
type of behaviour is learnt through operant conditioning.
Operant Conditioning
Operant conditioning, also called instrumental conditioning, refers to the process that
our behaviour produces certain consequences and how we behave in the future will depend on
what the consequences are. If our actions have pleasant effects, then we will be more likely to
repeat them in the future. If, however, our actions have unpleasant effects, we are less likely to
repeat them in the future. Thus, according to this theory, behaviour is the function of its
consequences.
Operant conditioning emphasises voluntary behaviours. Researchers call them "operant
behavior" because they operate on the environment (hence the term operant) they make the
environment respond in ways that we want. For example, you insert a coin in a coffee vending
machine and press a certain button so that the machine will offer a cup of coffee. You learnt
from past experience how to cause the environment (the machine) to deliver a cup of coffee.
(See also Table 9.1 for more such rewards). Examples of application of operant conditioning in
organisational settings are many. (Read Exhibit 9.2 for two such influences).
Operant conditioning has a much greater impact on human learning. It also explains
much of OB. For example, it might be said employees work eight hours a day, six days a week in
order to feed, clothe and shelter themselves and their families. Working is instrumental only in
obtaining food, clothing, and shelter. Some significant insights can be gained directly from this
kind of analysis. The consequences of OB can change the environmental situation and greatly
Page 19 of 77
affect subsequently employee behaviours. Managers can analyse the consequences of OB help
accomplish the goals of prediction and control.
Page 20 of 77
Cognitive Theory of Learning

Contemporary perspective about learning is that it is a cognitive process. Cognitive
process assumes that people are conscious, active participants in how they learn. Cognitive
theory of learning assumes that the organism learns the meaning of various objects and events
and exhibits responses depending on the meaning assigned to stimuli. Fig. 9.3 illustrates some
underpinnings of the cognitive view of learning.
First, in the cognitive view, people draw on their experiences and use past learning as a
basis for present behaviour. These experiences represent presumed knowledge or cognitions
For example, an employee faced with a choice of job assignment will use previous experiences
in deciding which one to accept. Second, people make choices about their behaviour. The
employee recognises his or her two alternatives and chooses one. Third, people recognise the
consequences of their choices. Thus, when the employee finds the job assignments rewarding
and fulfilling, he or she will recognise that the choice was a good one and will understand why.
Finally, people evaluate the consequences and add them to prior learning, which affects future
choices. Faced with the same job choices next year, the employee very likely will choose the
same one.
The cognitive theory of learning is relevant in the contemporary managerial practices.
Many motivation theories centre around the concept of cognition. Expectations, attributions,
and locus of control (which are in the forefront of work motivation) are all cognitive concepts
requiring attention while motivating employees.
Social Learning Theory

Also called observational learning, social learning theory, emphasises the ability of an
individual to learn by observing others. The important models may include parents (See
opening case), teachers, peers, motion pictures, TV artists, bosses and others.
Page 21 of 77
An individual acquires new knowledge by observing what happens to his or her model.
This is popularly known as vicarious learning. A learner acquire tacit knowledge and skills
through vicarious learning.
Observational learning involves several processes as shown in Fig. 9.4.

To start with, the learner must pay attention to the model the greater the attention, the
more effective the learning will be. Second, the observer must have good retention of the
model behaviour. Remembering helps develop a verbal description or mental image of
someone's actions in order to remember them. Third, observers must practise model's
behaviour. Unless, the learner is capable of doing exactly what the model does, he or she will
not be able to learn from observing peer, teacher or parent. Finally, the observer must have
some motivation to learn from the model. One does not emulate every behaviour he or she
sees, but focuses on that he or she has reason or incentive to match such as, an action for
which the model is rewarded.
Social learning has considerable relevance in OB. A great deal of what is learned to
about how to behave in organisations can be explained as the result of the process of
observation learning. A new hire acquire job skills by observing what an experienced employee
does Observational learning also occurs in a very informal, unarticulated manner. For instance
people who experience the norms and traditions of their organisations and who subsequently
incorporate these into their own behaviour may be recognised as having learnt through
observation.
Social learning is also valuable because it enhances the self efficacy of the learners Self
efficacy refers to a person's belief that he or she has the ability, motivation, and situational
contingencies complete a task successfully. People strong in self efficacy have a 'can do'
attitude towards a specific task and, more generally, with other challenges in life.
Social learning increases self-efficacy because people gain self-confidence after
observing someone else do than they are simply told what to do. This is particularly true when
Page 22 of 77
observers identity with the model, such as someone who is similar in age, experience, gender,
and related features.
Yet another benefit from observational learning is that it enables employees to shape
behaviours that benefit the organisation. Shaping is based on the principle that a little can
eventually go along way. Subjects receive a reward for each small steps towards a final goal the
target response rather than only for final response. Initially, actions even remotely resembling
the target behaviour termed successive approximations are followed by a reward. Gradually,
closer and closer approximations of the final target behaviour are required belong the reward is
given. An example substantiates the shaping principle more clearly. When baby suddenly blurts
out the sound Man, the parents are ecstatic. They immediately lavish attention and affection
on the child and do so each time the baby repeats the sound. Although initially the parents
respond enthusiastically to any sound the child makes, gradually they respond only to sound
approximate actual words. Shaping therefore, helps organisms acquire or construct new and
more complex forms of behaviour from simple behaviour.
Managers can shape employee behaviour by systematically reinforcing each successive
steps that moves the individual closer to the desired response. If an employee, for example,
who has been chronically a half-hour late for work comes in only twenty minutes late, the boss
can reinforce that improvement. Reinforcement would increase as responses more closely
approximate the desired behaviour.
NATURE OF ATTITUDES
Attitudes are understood as the beliefs, feelings and action tendencies of an individual
or group of individuals towards objects, ideas and people. This simple meaning has important
implications for managers.
1. Attitudes are learned. How attitudes are learned will be explained in the next section in
this chapter.
2. Attitudes refer to feelings and beliefs of an individual or groups of people.
3. These feelings and beliefs define one's predisposition towards given aspects of the
world.
4. Attitudes endure, unless something happens. For example, if X is transferred to day
shift, his attitude may become positive.
5. Attitudes can fall anywhere along a continuum for very favourable to very unfavourable.
Such expressions as "This B-School is good", "This leader is corrupt and incompetent"
are heard from people.
6. Attitudes are organised and are core to individual.
7. All people, irrespective of their status or intelligence, hold attitudes.
A few definitions on the concept of attitude are as follows:

"An attitude is mental state of readiness, learned and organised through experience,
exerting a specific influence on person's response to people, object and situations with which it
is related.
Page 23 of 77
COMPONENTS OF ATTITUDE
In general, attitudes comprise three elements.
An affective component the feelings, sentiments, moods and emotions about some
idea, person, event or object.
A cognitive element - the beliefs, opinion, knowledge, or information held by the
individual; and
A behavioural component- the predisposition to get on a favourable or unfavourable
evaluation of something.
These three components do not exist or function separately. An attitude represents the
interplay of a person's affective, cognitive and behavioural tendencies with regard to a person,
group, an event or an issue. For example, suppose that an individual holds a strong, negative
attitude about the use of nuclear power. During an employment interview with the
representative of a large firm, he discovers that the company is a major supplier of nuclear
power generation equipment. He might feel a sudden intense dislike for the company's
interviewer (the affective component). He might form a negative opinion of the interviewer
based on beliefs and opinions about the types of persons who would work for such a company
(the cognitive component). An important element of cognition is the evaluative beliefs held by
a person. He might be tempted to make an unkind remark to the interviewer or suddenly
terminate the interview (the behavioural component).
VALUES (L07)
Values represent stable, long-lasting beliefs about what is important. They are
evaluative standard that help us define what is right or wrong, good or bad, in the world. Some
people, value money while others consider morals as more important. Some value frugality
while others value generosity.
Values differ from attitudes. Values are general beliefs about life, whereas attitudes are
directed towards specific objects, events, or people. Of course, values influence our attitudes
Page 24 of 77
towards those objects. Further, a value stands in relation to some social or cultural standards or
norms. While attitudes are mostly personal experiences.
There are similarities too between values and attitudes. Both are acquired essentially
from the same council both values and attitudes endure and are resistant to change.
There are two types of values: terminal and instrumental. Terminal values are desired
states of existence that we think are worth striving for. A world of beauty, equality, wisdom,
and a comfortable life are some of the terminal values that people might hold. Instrumental
values, on the other hand, are desirable modes of behaviour that help us reach the objectives
of terminal values. Some instrumental values include being polite, courageous, logical, self-
controlled and ambitious.
Another way of categorising values is as follows:

1. Theoretical: Values the discovery of truth and emphasises critical and rational approach
to problems.
2. Economic: Values utility and practicality and emphasises standard of living.
3. Aesthetic: Values form grace, and harmony and emphasises the artistic aspects of life
4. Social: Values love of people and altruism and emphasises concern for others.
5. Political: Values power, position, and influence and emphasises competition and
winning.
6. Religious: Values unity and people's relationship to the universe and emphasises high
ideals and the search for the purpose of being on earth.
It may be stated that the values people emphasise vary with their occupations. For
instance, priests value religious value, scientist and professors are theoretically inclined,
business people are strong on economic values, artists have high aesthetic values, psychologists
and social workers talk about social values; and politicians have a high political value.
Morale in Organizations
A company’s work force is one of its greatest resources. Without employees, companies
would not be able to implement strategies or realize growth. It’s important for employers to
take care of their work force and foster high morale so that they can keep their organizations
running smoothly. Morale is the spirit of an organization, and it manifests either positively or
negatively among employees, teams and entire departments.
Good Morale
Morale is a way of describing how people feel about their jobs, employers and
companies, and those feelings are tied to the behaviors and attitudes that employees exhibit in
the workplace. When employees have good morale, they feel committed to their employers,
loyal to their jobs and motivated to be productive. They work harder, produce more, meet
deadlines and give it their all.
Low Morale
According to BNET, a website that offers business management advice, low morale
takes a toll on employee performance and productivity. Employees become less motivated to
work, less committed to their employers, exhibit an attitude of indifference and are absent
Page 25 of 77
more often. Companies pay the consequences of low morale, as less work gets done and time
and money are wasted.
Such characteristics may not always indicate low morale. Be sure that you don't
misdiagnose employees as having low morale when they may just be having a bad day. Low
morale is indicated by a pattern of these behaviors and attitudes over time.
Importance of Morale
Morale is a state of mind or willingness to work which in turn affects individual and
organizational objectives.
The importance of morale are

1. Higher performance.
2. Better quality of work.
3. Low absenteeism.
4. Good discipline.
5. Fewer industrial accidents.
6. Stability and growth of the organization.
STEPS TO IMPROVE MORALE IN AN ORGANIZATION

Following specific steps can be taken to improve the morale of employees
1. working conditions
2. job enrichment
3. praise
4. freedom of worker
5. good behaviour of authorities
6. provision of financial and non-financial incentives
7. Workers participation in management and other factors.
Working Conditions:
Working conditions have an important bearing on morale. Proper working conditions
create interest in the job and lead to higher morale. Under improper conditions of work, morale
is likely to fall. Proper working conditions include: provision of health, safety and welfare
measures, regulation of working hours, proper wage policy etc.
Job Enrichment:
Job enlargement and job enrichment helps in reducing fatigue, monotony, and
disinterest on the part of the workers, which ultimately lead to higher morale.
Praise:
Praise of employees in public for the good work done greatly help to use further
enthusiasm and energy in the workers. It also increases the morale of the employees.
Page 26 of 77
Freedom of Worker:
If a worker is treated like a cog in a wheel in the factory and is not given free hand in
working, he loses his interest in the job. In order to maintain the worker’s morale at a high
level, it is essential that he should be given the high degree of freedom. However, freedom
should not be
Good Behaviour of Authorities:

Behaviour of supervisors, managers and others greatly helps in determining employee’s
morale. Authorities should be considerate towards the workers. If the worker is constantly
interrupted and scolded, he loses respect for his superior which in turn lowers down his morale.
Provision of Financial and Non-Financial Incentives:

Edwin. B. Flippo has suggested certain incentives for the workers. These are referred as
major morale boosters. Some of these incentives are (i) job security ; (ii) opportunity, (iii)
employee benefits, (iv) social status (v) credit for work done etc. Financial incentives are related
to monetary rewards in the form of increase in pay, bonus, allowances etc.
Workers Participation in Management:

Workers participation in management is the most effective tool for improving
employees’ morale. It increases confidence and creates sense of belongingness on the part of
the workers. Since a worker takes part in the process of decision making, he feels that his
position in the firm has been elevated.
Other Factors:
In addition to the above mentioned measures certain other factors also contribute in
improving morale viz ; handling grievances at proper stage and time, employee counselling ;
delegation of authority ; proper promotion policy, collective bargaining etc.
Page 27 of 77
UNIT - III
PERCEPTION
Perception
Perception is an intellectual process of transforming sensory stimuli to meaningful
information. It is the process of interpreting something that we see or hear in our mind and use
it later to judge and give a verdict on a situation, person, group etc.
It can be divided into six types –
1. Of sound
2. Of speech
heard.
3. Touch
4. Taste − the ability to receive flavor of substances by tasting it through sensory organs
known as taste buds.
5. Other senses
time, sensation felt in throat and lungs etc.
6. Of the social world − It permits people to understand other individuals and groups of
their social world. Example − Priya goes to a restaurant and likes their customer
service, so she will perceive that it is a good place to hang out and will recommend it to
her friends, who may or may not like it. Priya’s perception about the restaurant is good.
Perceptual Process
Perceptual process is the different stages of perception we go through. The different
stages are
A. Receiving
B. Selecting
C. Organizing
D. Interpreting
A.Receiving
Receiving is the first and most important stage in the process of perception. It is the
initial stage in which a person collects all information and receives the information through the
sense organs.
B.Selecting
Selecting is the second stage in the process. Here a person doesn’t receive the data
randomly but selectively. A person selects some information out of all in accordance with his
interest or needs. The selection of data is dominated by various external and internal factors.
i.External factors − The factors that inﬂuence the perception of an individual externally are
intensity, size, contrast, movement, repetition, familiarity, and novelty.
ii.Internal factors of an individual internally are
psychological requirements, learning, background, experience, self
Page 28 of 77
acceptance, and interest.

C.Organizing
Keeping things in order or say in a synchronized way is organizing. In order to make
sense of the data received, it is important to organize them.
We can organize the data by
1. Grouping them on the basis of their similarity, proximity, closure, continuity.
2. Establishing a figure ground is the basic process in perception. Here by figure we mean
what is kept as main focus and by ground we mean background stimuli, which are not
given attention.
3. Perceptual constancy that is the tendency to stabilize perception so that contextual
changes don’t affect them.
D.Interpreting
Finally, we have the process of interpreting which means forming an idea about a
particular object depending upon the need or interest. Interpretation means that the
information we have sensed and organized is finally given a meaning by turning it into
something that can be categorized. It includes stereotyping, halo effect etc.
Importance of Perception in OB
We need to understand what the role of perception in an organization is. It is very
important in establishing different role of perceptions like −
1. Understanding the tasks to be performed.
2. Understanding associated importance of tasks allotted.
3. Understanding preferred behavior to complete respective tasks.
4. Clarifying role perceptions.
Implications of Perception
Perceptual Set:
Previously held beliefs about objects influence an individual’s perceptions of similar
objects.
Attribution:
Attribution refers to the process by which the individual assigns causes to the behavior
he or she conceives.
Stereotyping:
It is the tendency to assign attributes to someone solely on the basis of a category of
people to which that person belongs.
Halo Effect:
The Halo effect refers to the tendency of perceiving people in terms of good and bad
and ascribing all good qualities to one who is liked and all bad qualities to another who is
disliked.
Page 29 of 77
Perceptual Context:
The context in which an object is placed influences perception.
Perceptual Defense:
An individual is likely to put up a defense when confronted with conflicting,
unacceptable or threatening stimuli.
Implicit Personality:
In judging and making inferences about others, an individual’s perceptions are
influenced by his belief that certain human traits are associated with one another.
Projection:
Under certain conditions, people tend to see in another person traits that they
themselves possess.
MOTIVATION THEORIES
Abraham Maslow’s Need Hierarchy Theory
Maslow proposes that needs have a certain priority. As the more basic needs are
satisfied, an individual seeks to satisfy higher order needs. Hierarchy of needs is arranged in the
form of this pyramid in ascending order.
A. Physiological Need
These are the most powerful but basic needs for survival. This need dominates all other
needs.
B. Safety or Security Needs

Once physiological needs become relatively satisfied, the safety needs begin to
manifest and dominate human behavior. These include protection from physical dangers,
economic security, desire for a safe environment and the desire to know the limits of
Page 30 of 77
acceptable behavior. These two are lower order needs as considered by Maslow. The
remaining three needs are considered as higher order needs.
C. Social Need
A man wants to get associated with others, needs love and affection, gain acceptance
from people. These all come under the category of social needs. These needs have no limit,
they are regarded as secondary needs. They provide meaning to work life. If these needs are
not fulfilled, maladjustment in behavior is possible.
D. Self-esteem Needs
The esteem needs are concerned with self-respect, self-confidence, achievement,
competence, knowledge, need for status, recognition, appreciation and respect. These needs
are insatiable which are rarely satisfied. Neglecting these needs causes feelings of inferiority,
weakness, helplessness and worthlessness. Satisfaction of these needs produces feelings of
self-confidence, power and control.
E. Self -actualization Needs

These are the needs for realizing one’s own potentialities for continued self-
development. Self-fulfilling people are rare individuals who come close to living up to their full
potential for being a classical example of human virtues. It is a “growth” need. These are
substantially infinite.
Herzherg’s Motivation-Two Factor Theory

Frederick Herzberg conducted a research study to know the feelings of 200 engineers
and accountants in nine different companies in Pittsburgh, USA. During structured interview,
they were asked to describe a few job conditions in which they felt “exceptionally good or bad”
about jobs. On analyzing the information collected by interviews, Herzberg concluded that
there are two categories of needs essentially independent of each other affecting behavior in
different ways.
Hygiene Factors
These are job conditions which operate primarily to dissatisfy employees when the
conditions are absent. However their presence does not motivate them in a strong way. These
factors are also termed as maintenance factors as they are required to maintain minimum level
of productivity of employees.
a. Company policy and administration
b. Relationship with subordinates
c. Security
d. Salary
e. Personal life
f. Relationship With supervisor
g. Supervision
h. Status
i. Work conditions
Page 31 of 77
j. Relationship with peers
These factors produce no growth in a worker’s output; they only prevent losses in
worker’s performance. Any decrease in these factors will dissatisfy employees. So, they are also
called dissatisfiers. But they are of no use to motivating them if increased beyond any level.
Motivational Factors
These factors have a positive effect on Job satisfaction often resulting in one’s total
output. Most of these factors are intrinsic to the job. These are
a. Achievement
b. Recognition
c. Advancement
d. Work itself
e. Growth
f. Responsibility
Any increase in these factors will act as motivators for satisfying the employees;
however any decrease will not affect their satisfaction level. Herzberg maintains that it also
depends upon the personality characteristics of individuals, how they seek these factors, some
individuals are motivation seekers who look for growth and advancement. Others are
maintenance seekers who tend to be more concerned with work conditions like type of
supervision, salary etc. Job enrichment is one of the applications of Herzberg theory. Job
enrichment seeks to bring more motivation to the job by attaching more responsibility, more
power and more work to the position or job.
VROOM'S THEORY
What is Vroom’s Expectancy Theory?
In 1964, Canadian professor of psychology Victor Vroom developed the Expectancy
Theory. In it, he studied people’s motivation and concluded it depends on three
factors: Expectancy, instrumentality and valence.
Abraham Maslow and Frederick Herzberg also researched the relation between people’s
needs and the efforts they make. Vroom distinguishes between the effort people put in, their
performance and the final result. His theory primarily relates to motivation within a work
environment. When employees can make choices in their work, Victor Vroom argues that they
will mostly choose that what motivates them the most.
Motivational force formula

Victor Vroom uses a formula to calculate the motivational force:
Motivational force = Expectancy x Instrumentality x ValeIn the next paragraphs the different
components are further explained.
Expectancy
This is about what employees expect from their own efforts and the relation to good
performance. Part of this expectation is the level of difficulty he experiences. An organisation
Page 32 of 77
can respond to that by finding out which factors can motivate the employee to deliver his best
possible performance. Those factors can be facilities, training or support from a supervisor who
builds his employees’ confidence. Victor Vroom indicates that, in general, more effort leads to
better performance. Employees can be stimulated to make an effort by offering them a juicy
carrot if they complete their task properly and quickly. Of course, it’s also important that they
have the right resources at their disposal, that the employees have the necessary skills and that
management provides the right level of support.
Instrumentality
Each employee is a cog in the machine and an instrument that contributes to the
business results. From that perspective, instrumentality isn’t difficult to grasp. It’s about the
employee’s performance being good enough to achieve the desired result. An organisation can
stimulate this by actually making good on promises of additional rewards such as bonuses
or promotion. The employee has to believe that if he performs well, appreciation will be shown
for the results. Transparency throughout the reward process is an important condition for
instrumentality.
Valence
The final result that employees achieve is valued differently by each individual. This
value is based on their own basic needs. As such, it’s a good idea for an organisation to find out
what an individual employee values and what his personal needs are. One might value money,
while another values more days off.
Vroom’s Expectancy Theory:

Individual factors
According to Victor Vroom, behaviour is the result of a conscious choice from
alternatives. Employees have a preference for getting the most possible joy from their work
with little effort. Individual factors play a large role in the goals that have to be achieved and
the behaviour of employees. For instance, think of an employee’s personality, his knowledge
and skills, and the expectations he has of his own abilities. Together, these form a motivating
force that makes the employee act in a certain way. The individual effort, performance and
motivation are always interconnected. To properly motivate employees, Vroom argues that it’s
essential that there is a positive correlation between effort and performance.
Perception
Perception is an important factor in Vroom’s Expectancy Theory. An organisation might
perceive that it, as an employer, offers its employees everything they need to sufficiently
motivate them. For instance, a salary that’s 10% above industry average, 10 extra days off,
training programmes, or career opportunities. But not all employees will be sufficiently
motivated by that; each individual has a different perception. There might be employees who
would appreciate more support from their supervisor. If an organisation fails in that respect,
chances are the employees will be less motivated. Vroom’s Expectancy Theory of motivation is
not always about employee’s personal interest in rewards. It’s also about the associations
employees have regarding their performance and the result it will yield.
Page 33 of 77
Page 34 of 77
Application of the Vroom’s Expectancy Theory

According to Vroom’s Expectancy Theory, you can expect employees will increase their
efforts at work when the reward has more personal value to them. They’ll be more aware of
the fact that there is a link between their effort and the results. It means that both the
organisation and the employee have to be aware of the following three processes:
1. Increased efforts will improve work performance
2. Increased performance will lead to bigger rewards
3. The offered reward will be appreciated by the employee
If one of these conditions is not met, it’s hard to motivate the employee. Particularly the
last part can become an issue. An organisation therefore has to find out – together with its
employees – which rewards individual employee’s value; which rewards motivate them.
Organisations often consider financial bonuses to be the best way to motivate employees, even
though the Expectancy Theory shows that this is by no means always the most important factor
to employees. That’s why there has to be a proper balance between offering a financial bonus
and setting a clear performance standard, tailored to individual employees.
Group Characteristics:
Collection of two or more people:
Groups are the collection of two or more people. Groups are composed of two or more
persons in a social interaction. One plus one makes a group and groups and groups form an
organization. A single person cannot form a group as it at least requires two people for group
formation.
Common goal or interest:

In a group every members share common interest or goals. For example, members of a
marketing department constitute a group that is sustained by the mutual interest of the
members. The shared goal determines and identifies that all the members of the group have
common goals.
Interaction and Interdependency:

In any group there is interaction and interdependence among the group members either
physically or virtually to accomplish the group goal. For example, co-workers may work side by
side on related tasks in a work unit.
Collective identity:
Groups have collective identity, not the sum of individual members. Perhaps, it is the
awareness of each other that most clearly differentiates a group from an aggregation of
individuals. Groups are composed of people who recognize each other as a member of their
group and can distinguish these individuals from non-members.
A stable structure:
Page 35 of 77
Groups have a defined structure which gives relationship that keeps group members
together the stable functioning as a unit. It clarifies roles, authority and responsibility of each
group members which is important to accomplish group goal.
Group Process
Communication:
One of the easiest aspects of group process to observe is the pattern of communication:
a. Who talks? For how long? How often?
b. At whom do people look when they speak?
c. Single-out individuals, possible potential supporters.
d. The group.
e. No one.
f. Who talks after whom? Who interrupts whom?
g. What style of communication is used (assertions, questions, tone of voice, gestures,
etc.,
Participation:
One indication of involvement is verbal participation. Look for differences in the amount
of participation among members.
a. Who are the high participants? Who are the low participants?
b. Do you see any shift in participation (e.g., highs become quiet; lows suddenly become
talkative)? What are possible reasons for this in the group’s interaction?
c. How are the silent people treated? How is their silence interpreted? Consent?
Disagreement? Disinterest? Fear? Etc.?
d. Who talks to whom? Do you see any reason for this in the group’s interactions?
e. Who keeps the ball rolling? Why? Do you see any reason for this in the group’s
interactions?
GROUP DYNAMICS
A group can be defined as several individuals who come together to accomplish a
particular task or goal. Group dynamics refers to the attitudinal and behavioral characteristics
of a group. Group dynamics concern how groups form, their structure and process, and how
they function. Group dynamics are relevant in both formal and informal groups of all types. In
an organizational setting, groups are a very common organizational entity and the study of
groups and group dynamics is an important area of study in organizational behavior.
The following sections provide information related to group dynamics. Specifically, the
formation and development of groups is first considered. Then some major types or
classifications of groups are discussed. Then the structure of groups is examined.
GROUP DEVELOPMENT
As applied to group development, group dynamics is concerned with why and how
groups develop. There are several theories as to why groups develop. A classic theory,
developed by George Homans, suggests that groups develop based on activities, interactions,
Page 36 of 77
and sentiments. Basically, the theory means that when individuals share common activities,
they will have more interaction and will develop attitudes (positive or negative) toward each
other. The major element in this theory is the interaction of the individuals involved.
Social exchange theory offers an alternative explanation for group development.

According to this theory, individuals form relationships based on the implicit expectation of
mutually beneficial exchanges based on trust and felt obligation. Thus, a perception that
exchange relationships will be positive is essential if individuals are to be attracted to and
affiliate with a group.
Social identity theory offers another explanation for group formation. Simply put, this
theory suggests that individuals get a sense of identity and self-esteem based upon their
membership in salient groups. The nature of the group may be demographically based,
culturally based, or organizationally based. Individuals are motivated to belong to and
contribute to identity groups because of the sense of belongingness and self-worth
membership in the group imparts.
Group dynamics as related to development concerns not only why groups form but also
how. The most common framework for examining the "how" of group formation was
developed by Bruce Tuckman in the 1960s. In essence, the steps in group formation imply that
groups do not usually perform at maximum effectiveness when they are first established. They
encounter several stages of development as they strive to become productive and effective.
Most groups experience the same developmental stages with similar conflicts and resolutions.
According to Tuckman's theory, there are five stages of group development: forming,
storming, norming, performing, and adjourning. During these stages group members must
address several issues and the way in which these issues are resolved determines whether the
group will succeed in accomplishing its tasks.
Forming.
This stage is usually characterized by some confusion and uncertainty. The major goals
of the group have not been established. The nature of the task or leadership of the group has
not been determined (Luthans, 2005). Thus, forming is an orientation period when members
get to know one another and share expectations about the group. Members learn the purpose
of the group as well as the rules to be followed. The forming stage should not be rushed
because trust and openness must be developed. These feelings strengthen in later stages of
development. Individuals are often confused during this stage because roles are not clear and
there may not be a strong leader.
Storming.
In this stage, the group is likely to see the highest level of disagreement and conflict.
Members often challenge group goals and struggle for power. Individuals often vie for the
leadership position during this stage of development. This can be a positive experience for all
groups if members can achieve cohesiveness through resolution. Members often voice concern
and criticism in this phase. If members are not able to resolve the conflict, then the group will
Page 37 of 77
often disband or continue in existence but will remain ineffective and never advance to the
other stages.
Norming.
This stage is characterized by the recognition of individual differences and shared
expectations. Hopefully, at this stage the group members will begin to develop a feeling of
group cohesion and identity. Cooperative effort should begin to yield results. Responsibilities
are divided among members and the group decides how it will evaluate progress.
Performing.
Performing, occurs when the group has matured and attains a feeling of cohesiveness.
During this stage of development, individuals accept one another and conflict is resolved
through group discussion. Members of the group make decisions through a rational process
that is focused on relevant goals rather than emotional issues.
1. Adjourning. Not all groups experience this stage of development because it is

characterized by the disbandment of the group. Some groups are relatively permanent
(Luthans, 2005). Reasons that groups disband vary, with common reasons being the
accomplishment of the task or individuals deciding to go their own ways. Members of
the group often experience feelings of closure and sadness as they prepare to leave.
GROUP TYPES
One common way to classify group is by whether they are formal or informal in nature.
Formal work groups are established by an organization to achieve organizational goals. Formal
groups may take the form of command groups, task groups, and functional groups.
COMMAND GROUPS.
Command groups are specified by the organizational chart and often consist of a
supervisor and the subordinates that report to that supervisor. An example of a command
group is an academic department chairman and the faculty members in that department.
TASK GROUPS.
Task groups consist of people who work together to achieve a common task. Members
are brought together to accomplish a narrow range of goals within a specified time period. Task
groups are also commonly referred to as task forces. The organization appoints members and
assigns the goals and tasks to be accomplished. Examples of assigned tasks are the
development of a new product, the improvement of a production process, or the proposal of a
motivational contest. Other common task groups are ad hoc committees, project groups, and
standing committees. Ad hoc committees are temporary groups created to resolve a specific
complaint or develop a process. Project groups are similar to ad hoc committees and normally
disband after the group completes the assigned task. Standing committees are more
permanent than ad hoc committees and project groups. They maintain longer life spans by
rotating members into the group.
Page 38 of 77
FUNCTIONAL GROUPS.
A functional group is created by the organization to accomplish specific goals within an
unspecified time frame. Functional groups remain in existence after achievement of current
goals and objectives. Examples of functional groups would be a marketing department, a
customer service department, or an accounting department.
In contrast to formal groups, informal groups are formed naturally and in response to
the common interests and shared values of individuals. They are created for purposes other
than the accomplishment of organizational goals and do not have a specified time frame.
Informal groups are not appointed by the organization and members can invite others to join
from time to time. Informal groups can have a strong influence in organizations that can either
be positive or negative. For example, employees who form an informal group can either discuss
how to improve a production process or how to create shortcuts that jeopardize quality.
Informal groups can take the form of interest groups, friendship groups, or reference groups.
INTEREST GROUPS.
Interest groups usually continue over time and may last longer than general informal
groups. Members of interest groups may not be part of the same organizational department
but they are bound together by some other common interest. The goals and objectives of
group interests are specific to each group and may not be related to organizational goals and
objectives. An example of an interest group would be students who come together to form a
study group for a specific class.
FRIENDSHIP GROUPS.
Friendship groups are formed by members who enjoy similar social activities, political
beliefs, religious values, or other common bonds. Members enjoy each other's company and
often meet after work to participate in these activities. For example, a group of employees who
form a friendship group may have an exercise group, a softball team, or a potluck lunch once a
month.
REFERENCE GROUPS.
A reference group is a type of group that people use to evaluate themselves. According
to Cherrington, the main purposes of reference groups are social validation and social
comparison. Social validation allows individuals to justify their attitudes and values while social
comparison helps individuals evaluate their own actions by comparing themselves to others.
Reference groups have a strong influence on members' behavior. By comparing themselves
with other members, individuals are able to assess whether their behavior is acceptable and
whether their attitudes and values are right or wrong. Reference groups are different from the
previously discussed groups because they may not actually meet or form voluntarily. For
example, the reference group for a new employee of an organization may be a group of
employees that work in a different department or even a different organization. Family, friends,
and religious affiliations are strong reference groups for most individuals.
Page 39 of 77
GROUP STRUCTURE
Group structure is a pattern of relationships among members that hold the group
together and help it achieve assigned goals. Structure can be described in a variety of ways.
Among the more common considerations are group size, group roles, group norms, and group
cohesiveness.
GROUP SIZE
Group size can vary from 2 people to a very large number of people. Small groups of two
to ten are thought to be more effective because each member has ample opportunity to
participate and become actively involved in the group. Large groups may waste time by
deciding on processes and trying to decide who should participate next. Group size will affect
not only participation but satisfaction as well. Evidence supports the notion that as the size of
the group increases, satisfaction increases up to a certain point. In other words, a group of six
members has twice as many opportunities for interaction and participation as a group of three
people. Beyond 10 or 12 members, increasing the size of the group results in decreased
satisfaction. It is increasingly difficult for members of large groups to identify with one another
and experience cohesion.
GROUP ROLES
In formal groups, roles are usually predetermined and assigned to members. Each role
will have specific responsibilities and duties. There are, however, emergent roles that develop
naturally to meet the needs of the groups. These emergent roles will often replace the assigned
roles as individuals begin to express themselves and become more assertive. Group roles can
then be classified into work roles, maintenance roles, and blocking roles.
Work roles are task-oriented activities that involve accomplishing the group's goals.
They involve a variety of specific roles such as initiator, informer, clarifier, summarizer, and
reality tester. The initiator defines problems, proposes action, and suggests procedures.
The informer role involves finding facts and giving advice or opinions. Clarifiers will
interpret ideas, define terms, and clarify issues for the group. Summarizers restate suggestions,
offer decisions, and come to conclusions for the group. Finally, reality testers analyze ideas and
test the ideas in real situations.
Maintenance roles are social-emotional activities that help members maintain their
involvement in the group and raise their personal commitment to the group. The maintenance
roles are harmonizer, gatekeeper, consensus tester, encourager, and compromiser. The
harmonizer will reduce tension in the group, reconcile differences, and explore opportunities.
Gatekeepers often keep communication channels open and make suggestions that encourage
participation. The consensus tester will ask if the group is nearing a decision and test possible
conclusions. Encouragers are friendly, warm, and responsive to other group members. The last
maintenance role is the compromiser. This role involves modifying decisions, offering
compromises, and admitting errors.
Page 40 of 77
Blocking roles are activities that disrupt the group. They make take the form of
dominating discussions, verbally attacking other group members, and distracting the group with
trivial information or unnecessary humor. Often times the blocking behavior may not be
intended as negative. Sometimes a member may share a joke in order to break the tension, or
may question a decision in order to force group members to rethink the issue. The blocking
roles are aggressor, blocker, dominator, comedian, and avoidance behavior. The aggressor
criticizes members' values and makes jokes in a sarcastic or semi-concealed manner.
Blockers will stubbornly resist the group's ideas, disagree with group members for
personal reasons, and will have hidden agendas. The dominator role attempts to control
conversations by patronizing others. They often interrupt others and assert authority in order
to manipulate members. Comedians often abandon the group even though they may physically
still be a part. They are attention-getters in ways that are not relevant to the accomplishment
of the group's objectives. The last blocking role, avoidance behavior, involves pursuing goals not
related to the group and changing the subject to avoid commitment to the group.
Role ambiguity concerns the discrepancy between the sent role and the received role,
as shown in Exhibit 1. Supervisors, directors, or other group leaders often send (assign) roles to
group members in formal groups. Group members receive roles by being ready and willing to
undertake the tasks associated with that role. Ambiguity results when members are confused
about the delegation of job responsibilities. This confusion may occur because the members do
not have specific job descriptions or because the instructions regarding the task were not clear.
Group members who experience ambiguity often have feelings of frustration and
dissatisfaction, which ultimately lead to turnover.
Role conflict occurs when there is inconsistency between the perceived role and role
behavior. There are several different forms of role conflict. Interrole conflict occurs when there
is conflict between the different roles that people have. For example, work roles and family
roles often compete with one another and cause conflict. Intrarole conflict occurs when
individuals must handle conflicting demands from different sources while performing the tasks
associated with the same role.
GROUP NORMS
Norms are acceptable standards of behavior within a group that are shared by the
members of the group. Norms define the boundaries of acceptable and unacceptable behavior.
They are typically created in order to facilitate group survival, make behavior more predictable,
avoid embarrassing situations, and express the values of the group. Each group will establish its
own set of norms that might determine anything from the appropriate dress to how many
comments to make in a meeting. Groups exert pressure on members to force them to conform
to the group's standards. The norms often reflect the level of commitment, motivation, and
performance of the group.
Performance norms determine how quickly members should work and how much they
should produce. They are created in an effort to determine levels of individual effort. They can
be very frustrating to managers because they are not always in line with the organization's
Page 41 of 77
goals. Members of a group may have the skill and ability to perform at higher levels but they
don't because of the group's performance norms. For example, workers may stop working a
production machine at 20 minutes before quitting time in order to wash up, even though they
produced fewer items that day than management intended.
Reward-allocation norms determine how rewards are bestowed upon group members.
For example, the norm of equality dictates equal treatment of all members. Every member
shares equally so rewards are distributed equally to everyone. Equity norms suggest that
rewards are distributed according to the member's contribution. In other words, members who
contribute the most receive the largest share of the rewards. Members may contribute through
effort, skill, or ability. Social responsibility norms reward on the basis of need. Members who
have special needs therefore receive the largest share of the reward.
The majority of the group must agree that the norms are appropriate in order for the
behavior to be accepted. There must also be a shared understanding
Exhibit 1
Role Ambiguity and Role Conflict
that the group supports the norms. It should be noted, however, that members might violate
group norms from time to time. If the majority of members do not adhere to the norms, then
they will eventually change and will no longer serve as a standard for evaluating behavior.
Group members who do not conform to the norms will be punished by being excluded, ignored,
or asked to leave the group.
GROUP COHESIVENESS
Cohesiveness refers to the bonding of group members and their desire to remain part of
the group. Many factors influence the amount of group cohesiveness. Generally speaking, the
more difficult it is to obtain group membership the more cohesive the group. Groups also tend
to become cohesive when they are in intense competition with other groups or face a serious
external threat to survival. Smaller groups and those who spend considerable time together
also tend to be more cohesive.
Cohesiveness in work groups has many positive effects, including worker satisfaction,
low turnover and absenteeism, and higher productivity. However, highly cohesive groups may
be detrimental to organizational performance if their goals are misaligned with organizational
Page 42 of 77
goals. Highly cohesive groups may also be more vulnerable to groupthink. Groupthink occurs
when members of a group exert pressure on each other to come to a consensus in decision
making. Groupthink results in careless judgments, unrealistic appraisals of alternative courses
of action, and a lack of reality testing. It can lead to a number of decision-making issues such as
the following:
1. Incomplete assessments of the problem,

2. Incomplete information search,
3. Bias in processing information,
4. Inadequate development of alternatives, and
5. Failure to examine the risks of the preferred choice.
Evidence suggests that groups typically outperform individuals when the tasks involved
require a variety of skills, experience, and decision making. Groups are often more flexible and
can quickly assemble, achieve goals, and disband or move on to another set of objectives. Many
organizations have found that groups have many motivational aspects as well. Group members
are more likely to participate in decision-making and problem-solving activities leading to
empowerment and increased productivity. Groups complete most of the work in an
organization; thus, the effectiveness of the organization is limited by the effectiveness of its
groups.
Decision making:
Many kinds of decisions are made in groups without considering the effects that these
decisions will have on other members. Some people try to impose their own decisions on the
group, while others want all members to participate or share in the decision making process.
1. Does anyone make a decision and carry it out without checking with other group
members (self authorized)? For example, one person decides on the topic to be
discussed and immediately begins to talk about it. What effect does this have on other
group members?
2. Does the group drift from topic to topic? Who topic-jumps? Do you see any reason for
this in the group’s interactions?
3. Who supports other members’ suggestions or decisions? Does this support result in the
two members deciding the topic or activity for the group? How does this affect the
other group members?
4. Is there any evidence of a majority pushing a decision through over other members’
objections? Do they call for a vote? Is there any attempt to get all members
participating in a decision? What effect does this seem to have on the group?
5. Does anyone make any contributions that do not receive any kind of response or
recognition? What effect does this have on the member?
Organizational roles:
A variety of crucial roles need to be filled to ensure group goal accomplishment and
success. Roles are distributed among three types:
Page 43 of 77
Task: Focused on getting things done Examples: initiator contributor, information seeker and
giver, elaborator, orientator, energizer, recorder.
Maintenance:
Oriented toward improving relationships among members. Examples: encourager,
harmonizer, compromiser.
Self-Oriented: Focused on personal needs regardless of group concerns. Examples: aggressor,

recognition seeker, dominator, blocker.
Group Decision Making:

The final component of group structuring relates to decision making. Here, we propose
to focus on the problems and benefits of group decisions.
Group or organizational decision making is more difficult than individual decision making for
the simple reason of the number of people involved in the process.
Approaches to Group Decision Making

There are several approaches to group decision making. A few major approaches are
explained here.
Autocratic decision making:

Here, the leader makes a decision by himself or herself or independently. This approach
is fast and often effective, particularly when the leader is competent person. The method is
highly useful in times of crisis.
Expert member soliciting:

In this method, advice of an individual who is expert in the concerned area is obtained
and decision is then made. Where the persons involved in deem making do not possess
adequate knowledge about the subject, this method is appropriate.
Consultative decision making:

This approach involves obtaining inputs from those responsible for and affected by the
decision and then making a decision independently. To the extent that decision makers obtain
inputs from others, this approach is an improvement.
Minority control:
This approach involves allowing a small number of people in the group to make a
decision. This method is desirable when there is a crisis demanding immediate action and when
only a small number of members have the requisite knowledge about the matter.
Majority control:
Page 44 of 77
Where majority of members involve themselves in decision making, the method is called
majority control method. This method has an advantage inasmuch as it allows a large number
of members to involve themselves in decision making.
Consensus:
This approach involves finding a proposal acceptable to all members. This is a ‘win-win'
situation. This approach has an advantage in the sense that all the group members are
committed to the decision.
Page 45 of 77
UNIT - IV
LEADERSHIP STYLES AND THEIR IMPLICATIONS
Leadership style is the typical approach a particular person uses to lead people. Stated
differently, the behaviour the leader exhibits during supervision of subordinates is known as
leadership style. Style is said to comprise two distinct elements the leader's assumptions about
subordinates and the leader's actual behaviour while interacting with subordinates. Although
this distinction is not made in academic circles (where emphasis is more on leader behaviour), it
is important to keep in mind, particularly when changes in leader behaviour are desired. A
change in leader behaviour can be achieved by either changing the leader's assumptions about
people or by first forcing behavioural change of the leader and then hoping for attitudinal
change later
In the meanwhile, the study of leadership styles is useful because it focuses on what the
leader actually does in getting work accomplished through people.
Our discussion of leadership style is divided into four types: () Sty based on the amount
of authority retained by the leader; (ii) Styles based on the relative emphasis placed on the task
to be performed versus that placed on people; (11) Styles based on the assumptions about
people made by the leader; (iv) Likert's four styles; and (v) Entrepreneurial leadership styles.
1.Styles Based on Authority Retained

This is the classical approach to classifying the leadership styles and is useful even today.
Styles in this approach are classified depending on how much authority retained by the leader
versus how much is delegated to the subordinate employees. We have the familiar three- way
min authoritarian, participative and free-rein leadership.
Authoritarian Style:
Known in its acronym as autocratic style, authoritarian style involves retention of full
authority by the leader. Leader decides, decision is passed on to subordinates instructions
about ne implementation of decision are given and the subordinates are expected to do what
the leader has told them to do. Assuring that the leader is competent, the advantage of this
leadership style is that tasks are efficiently completed, since there is no opportunity for the
time-consuming two-way communications associated with democratic styles.
The primary problem with authoritarian leadership style is that workers are made aware
of what to do, but not why. This may lead to: (1) low employee morale, and (2) workers
following leader directions lose initiative and avoid responsibility for any errors.
But there are some workers who prefer autocratic leader. They feel secure under his or
her leadership. In such cases, productivity and morale of the workers tend to be high.
Participative Style:
There are three related types of participative leaders: consultative, consensual and
democratic.
Consultative leaders solicit opinions from group before making a decision, yet they do
not feel obliged to accept the group's thinking; these leaders make it clear that they alone have
final authority to make final decisions.
Page 46 of 77
Consensual leaders encourage group discussion on an issue and then make a decision
that reflects the general agreement (consensus) of group members. Consensual leaders
delegate more authority to the group than do the consultative leaders. This style leads to
considerable delay in decision making because every member has to be give his/or her consent
Democratic leaders confer final authority on the group. They function as collectors of
opinion and take a vote before making a decision. Democratic leaders delegate full authority to
subordinates. This style is more relevant for community activities than for work settings.
The participative style has merits. Firstly, it is highly effective where group comprises
competent and motivated members who want to get involved in making decisions ar giving
feedback to the leader. Secondly, employees' feelings of self worth and satisfaction are
increased because the leader conveys a sense of confidence in employee judgement. Thirdly,
participation allows employees to satisfy high-level needs such as esteem and self-actualisation
by allowing them to take part in decision making. Fourthly, employee participation in decision
making improves the quality of decisions, because when more people think about problem it is
likely that a better solution will be found. Finally, there will be less resistance to change
because those have developed the solution will usually support its implementation.
This particular style seems to have only academic interest. In practice, the style may not
work. Neither the leader has large heart to share authority with others nor the subordinates
have physical and mental preparedness to take part in decision making. Where both these
possible, decision making is likely to get delayed.
Free-rein style:
Also called laissez-faire, free-rein leader chooses not to adopt a leadership role and
actually abdicates leadership position, generally relinquishing it to someone else in the
workgroup. While technically not a leadership style (it is more the absence of one), it does
warrant brief mention since the absence of leadership may have a positive or negative effect.
On the positive side, free-rein leadership works when the group is composed of highly
committed members. On the negative side, it may be stated that the leader abdicates
leadership role because of his or her own incompetence, the fear of failure, or the perceived
social cost of ostracisation by the workgroup.
Styles Based on Task versus People Emphasis (Task oriented)

Another standard way of classifying leadership styles is based on the relative concern
the leader places on the task to be performed vis-à-vis the people performing the task.
A leader who places greater emphasis on task performance tends to exhibit the
following behaviours:
a. Organising and defining the roles of the group members.
b. Explaining what activities each has to do and when, where and how tasks are to
be accomplished.
c. Establishing well-defined patterns of organisation, channels of communication
ways of task accomplishment.
Page 47 of 77
A leader who places greater emphasis on people tries to gain their relationships by
exhibiting such behaviours as:
a. Establishing channels of communication.

b. Extending psychological support to them.
c. Developing mutual trust.
d. Developing empathy for them.
Depending on task emphasis or people emphasis, four combinations are possible as

in Fig. 18.3.
A brief description of each style follows:
High-task and Low-relationship:

A high-task and low-relationship leader emphasises showing employees how to get the
tasks accomplished and spends minimum time giving psychological support. This style may be
effective where the employees are inexperienced with the work to be performed. The high-task
and low-relationship style may also be well suited to situations where seasonal help is involved.
Seasonal employees may be unfamiliar with the task and these require direct guidance on
performing the work properly. A high-task and low-relationship leader is not necessarily rude or
discourteous. The leader simply takes the expedient route of focusing on work rather than
people.
High-task and High-relationship:
Page 48 of 77
This leader spends considerable time showing people how to get the work accomplished
and providing them psychological support. The high-task and high-relationship style is
considered generally useful because it results in high productivity and personal satisfaction. A
more critical look at this style would suggest that it works best in situations where people need
an active and involved leader. When employees are lacking in self-confidence and technical
skill, the high-task and high-relationship style is particularly effective.
High-relationship and Low-task:

A leader using the high-relationship and low-task style gives employees much
encouragement and support but a minimum of guidance about the task accomplishment. In
some situations, employees need more psychological support rather than technical
instructions. The high-relationship and low-task style is suitable for such situations.
Low-relationship and Low-task:

A leader using this style is neither here nor there. It is essentially a free-rein style.
Subordinates are given considerable latitude in performing their work. They are also given very
little psychological support, encouragement and praise. They are, therefore, free to run their
own show. When subordinates are highly skilled and the psychologically mature, this style can
be effective
Styles Based on Assumptions about People:

Depending on what assumptions a leader makes about his or her followers, two styles
may be distinguished. In two-way classification is based on McGregor's famous Theory X and
Theory Y assumptions about people. These assumptions are pointed out later in this chapter. In
the meantime, it may be stated that Theory X leaders are autocratic. They distrust people and
believe in close supervision and tight-control over the subordinates. Theory Y leaders are
participative, they trust subordinates and allow them to participate in decision making.
Likert's Four Styles

Developing on the notion that leadership style consists of two extreme positions -
autocratic and democratic. Likert develops four styles of leadership to capture the management
culture of an organisation: exploitative authoritative, (ii) benevolent authoritative, (iii)
consultative, and (iv) participative.
Exploitative authoritarian:
As an exploitative authoritarian, the leader uses sanctions, communication is
downward, superiors and subordinates are psychologically distant, and the decisions are
generally made at the top of the organisation.
Benevolent authoritarian:
Here, the leader uses rewards to encourage performance, upward Communication is
permitted but to the extent the boss wants, subservience to boss is widespread, and there is
some delegation in decision making, though major decisions are made by the people at the top
of the hierarchy.
Page 49 of 77
Page 50 of 77
Consultative:
Here, the leader uses rewards, communication is two-way although upward,
Communication is cautious and limited, some involvement is sought from employees, and as in
the benevolent authoritarian style, subordinates are involved in decision making in a limited
way.
Participative:
The leader disperses economic rewards and makes full of group participation and
involvement in setting performance standards and improving methods and procedures.
Subordinates and superiors are psychologically close, and group decision making is widespread
in the organisation. There is a tendency among a number of individuals to belong to more than
one workgroup in order to promote inter-group links and understanding.
Entrepreneurship Leadership Style

An entrepreneur is a person who coverts an innovative idea into business. The word
entrepreneur is generally associated with small-scale industry. What is an entrepreneurship
leadership style? Based on both their personality characteristics, and the circumstances of
operating a business, many entrepreneurs use a similar leadership style. The most notable
features of this style are:
a. Impatience and brusqueness towards employees because the entrepreneur is

always busy.
b. A heavy task orientation combined with a very direct approach to giving
instructions to employees.
c. A charismatic personality that inspires others to want to do business with him or
her despite the impatience.
d. A much stronger interest in dealing with customers than employees.
e. A strong dislike for bureaucratic rules and regulations.
f. Anxiety to consolidate business gains as quickly as possible.
Some of the styles described above will be referred to again later in different contexts
THEORIES OF LEADERSHIP
From the beginning of the 20th century, many distinguished authors and researchers
have contributed to the rich knowledge on leadership. Without the forward-looking visions of
past generations (some of whom are listed in Table 18.2), we would not have the insights that
we have today. While, examining all the earlier contributions is rather unnecessary, we focus on
certain works, which are relevant even today.
Historically, focus on leadership in theories shifted from one dimension of leadership to

another. Early leadership research focused on the leader himself or herself to the virtual
exclusion of other variables. It was assumed that leadership effectiveness could be explained
Page 51 of 77
isolating psychological, physical characteristics, or traits, which were presumed to differentiate

the leader from the other members of the group.
As the years went by, the focus shifted from the personality of the leader to his or her
behaviour while delegating tasks to subordinates and communicating with them. It was
believed by the behaviourists that a leader's effectiveness depended upon behaviours and not
on traits alone.
More recently, the situation in which the leader operates has been given much
importance. It is believed that the leadership effectiveness depends on the situation in which
the lead operates.
We shall discuss a few important theories on leadership with an assertion that any
theory will be complete only when it covers three important dimensions of leadership, namely:
1. The leader and his or her psychological attributes;

2. The follower with his or her problems, attitudes, and needs; and
3. The group situation in which followers and leaders relate with one another.
To concentrate on any one of these three factors represents oversimplification of an intricate

phenomenon.
The theories of leadership considered in the following pages are:

A. Trait theory
B. Leader behaviour theory
C. The managerial grid
D. Contingency theories
Besides, the famous Theory X and Theory Y of McGregor has also been considered.
A.Trait Approach
The trait theories of leadership focus on the individual characteristics of successful
leaders. According to the theories, leaders possess a set of traits which make them distinct
from followers. An attempt must, therefore, be made to identify and measure these traits
Attempts were indeed made in the past to identify such qualities. Ralph Stogdill, for
instance surveyed more than 5,000 leadership studies and concluded that successful leaders
tend to have the following qualities:
I. A strong desire for accomplishment

II. Persistent pursuit of goals
III. Creativity and intelligence used to solve problems
IV. Initiative applied to social situations
V. Self-assumed personality
VI. Willingness to accept behavioural consequences
VII. Low susceptibility to interpersonal stress
VIII. High tolerance of ambiguity
Page 52 of 77
IX. Ability to influence other people

X. Ability to structure social interactions
Most of the research on leadership conducted till now concentrated mainly on the
unique qualities of successful leaders. There has been little systematic study of the personal
traits of unsuccessful leaders. Probably, ineffective leadership is associated with such qualities
as poor temperament, as can get along with others, lack of vision, lack of character and mental
health problems such as aggression, depression, disorganisation, paranoia, neurosis and
procrastination. In addition, some attitudinal factors seem to be associated with ineffective
leaders. These include: (1) overconcern with morale, (2) failure to maintain an objective
attitude, (3) lack of a sense of proportion, (4) practising "polarisation or seeing others as either
good or bad, (5) idealism in decision making and (6) over-eagerness to do the "right" things.
Evaluation of the Trait Theory:

The trait approach to leadership has been severely criticised by many. Some of the
limitations of the theory are the following:
i. The list of personality traits of successful leaders is too long and there seems to be no
finality about it. Although hundreds of traits have been identified, no consistent pattern
has emerged.
ii. How much of which trait a successful leader must have is not clear. Furthermore certain
traits, particularly psychological, cannot be quantified.
iii. The theory assumes that a leader is born and not trained. This assumption is acceptable
to the contemporary thinkers on the subject.
iv. Contrary to what the theory assumes, leadership effectiveness does not depend upon
the personality of the leader alone. Other variables like the situation, the task ,the
organisation and the characteristics of followers will equally determine the effectiveness
of leaders.
v. It is well known that people who fail as leaders and people who never achieve positions
of leadership often possess some of the same traits as successful leaders. Thus, for
example, although taller people may generally be more successful as leaders, many tall
people have neither the inclination nor the capabilities to be leaders. At the same time,
many short people have risen to positions of leadership.
vi. There is little consensus on the meaning of words used to label traits. In a study of
extensive leadership qualities, a researcher demonstrated the magnitude of this
problem when he asked 75 top executives to define the term "dependability", a trait
associated with effective leadership. The executives defined this trait in 147 different
ways. Even after similar definitions had been combined, 25 different definitions
remained.
It doesn’t mean to say that the trait theory of lie theory of leadership is irrelevant. With
all its limitations, the theory is still relevant because of certain merits.
Page 53 of 77
One merit relates to the qualities of successful leaders. Focusing on personality traits, a
review of studies carried out from 1900 to 1957 showed that leaders tend to be consistently
better adjusted, more dominant, more extroverted, more masculine, and more conservative
and have greater interpersonal sensitivity than non-leaders.
The second merit relates to the influence of personality on one's effectiveness person's
personality, what he fundamentally is as a person, is an ever present and massive influence on
how and with what success, he functions as a manager"
The personality of man is his inner life, including such inner elements as background, life
history, beliefs, life experiences, attitudes, prejudices, self-image, fears, loves, hates, hopes and
Philosophy of life. In this sense, a man is like an iceberg: only a small fraction of what he
appears above the surface (his observable behaviour, what he does); the rest is his inner life,
the of the7/8th iceberg that lie, unobservable, below the surface."
However, the manager's inner personality causes or 'spills over' into his behaviour
which, in turn, affects others with whom he works, eliciting from them either co-operative or
resistance reactions. And, therein lies the manager's fate: cooperative reactions from his
people spell success, resistance reactions, however irrational from the manager's viewpoint,
usually assure failure.
"It is clear that there is an influential relationship between a manager's total personality
and his success as a manager on the job. I have submitted this precise concept to several
thousand practising managers over the years and based on their experience virtually all
knowledge its validity."
Third, the view that leaders are born, not made is in fact, still popular (though not
among researchers). After a lifetime of reading popular novels and viewing films and television
shows perhaps most of us believe, to some extent, that there are individuals who have
predisposition to leadership, that they are naturally braver, more aggressive, more decisive and
more articulate than other people.
Finally, the theory has certain practical implications also. If leadership traits could be
identified, then nations and organisations would become far more sophisticated in selecting
leaders. Only those people who possess the designated leadership traits would become
politicians officers and managers. Presumably, organisations and societies would then operate
more effectively.
Behavioural Theories
Beginning in the late 1940s and continuing through the early 1960s, researchers away
from an emphasis on traits and towards the study of leader behaviours. This new approach
differed from the trait-oriented research in at least two ways. First, actual leader behaviours
instead of personal traits were the main focus. Second, whereas most trait studies sought to
Page 54 of 77
separate leaders from non-leaders, leader behaviour studies wanted to determine how various
kinds of specific behaviour affect the performance and satisfaction of followers. Thus difference
between the two approaches is summarised
The Ohio State University studies and the University of Michigan studies are the two
important behavioural theories.
Ohio State University Studies:

These well publicised studies were started shortly after World War ll. The main objective
of the studies was to identify the major dimensions of leadership and to investigate the effect
of leader behaviour on employee performance and satisfaction. From a list of leader behaviours
in a wide variety of situations, two leadership dimensions were identified.
a. The initiating structure, which refers to leader behaviour that defines an

organisation the group as vs the tasks to employees and supervises their activities.
b. Consideration refers to leader behaviour that can be characterised by friendliness,
respect, supportiveness, openness, trust and concern for the welfare of the
employees.
The main point in the study is that both consideration and initiating structure are not
seen as being placed on a continuum. That's rather than a leader necessarily being low on one
dimension when high on the other, the leader could be high on both, low on both, or high on
one and low on the other as seen in the quadrants
The findings of the Ohio State studies can be summarised as follows
i)Consideration was positively related to low absenteeism and grievance, but it was negatively
or neutral related to performance.
ii) Initiating structure was positively related to employee performance but was also associated
with such negative consequences as absenteeism and grievances.
iii) When both consideration and structure were high, performance and satisfaction tended to
Page 55 of 77
be high. But in rich productivity was accompanied by absenteeism and grievance
The University of Michigan Studies:

These studies were conducted during the same period as those at Ohio State and
resulted in identical conclusions. As in the Ohio State University the studies, researchers at the
University of Michigan distinguished between two dimensions of leadership: production-
centred and employee-centred. Production-centred leaders set rigid work standards, organised
tasks down to the last detail, prescribed the work methods to be followed and closely
supervised subordinates' performance. Employee-centred leaders, on the other hand,
encouraged employee participation in goal-setting and in other work-related decisions, and
helped ensure high performance by inspiring respect and trust.
At first the findings of Michigan, studies seem to refute the Ohio State research because
they place leadership on a continuum such as the one shown in Fig. 18.5 and concede that the
further to the right the leaders go, the better-off they are. But a deeper analysis reveals that
employee and work orientation are two separate dimensions and that a leader can be either
high or low on one or both. Thus, the two styles discovered by the Michigan researchers were
Similar to those of the Ohio State people. The production-centred leadership factor and the
initiating-leadership structure factor both measured work orientation, while the employee-
oriented factor and the consideration factor both measured people orientation.
Evaluation of Behavioural Theories:

In leader behaviour theories, unlike in the trait theories, the focus was on what leaders
did how they delegated the task, how they communicated with and tried to motivate their
subordinates, how they carried out their tasks and so on. The theories underlined that the
behaviours can be learnt and an individual trained in the appropriated leadership behaviours
would be able to lead more effectively. This is the main contribution of the leader behaviour
theory.
Behavioural theorists, however, could not successfully identify a consistent relationship
between leadership behaviour and group performance. General statements could not be made
because results would vary over different range of circumstances. What was missing was the
consideration of the situational factors that influence success or failure.21
Leader-Member Exchange (LMX) Theory:
Page 56 of 77
Also called the vertical dyad model, this approach too focuses more on leader
behaviours. A vertical dyad consists of two persons who are linked hierarchically, such as a
supervisor and a subordinate. The leader behaviour depends the subordinate is. The theory is
advocated by George Graen and his associates.
The basic idea behind the LMX theory is that leaders form two groups, in-groups,
groups, of followers. In-group members tend to be similar to the leader, and get greater
responsibilities, more attention, and more rewards. They work within the leader's inner circle of
communication. As a result, in-group members are more satisfied, have lower turnover, and
have high organisational commitment. In contrast, out-group members are outside the circle
and receive less attention and fewer rewards. They are managed by formal rules and policies.
An important implication of the LMX model is that leadership can be understood better
by examining dyads (pairs of relations) made up of leader and member (a vertical relationship)
rather than by concentrating on what one might call the average leadership style. Graen and his
associates contend that much of the past studies on leadership presume the existence average
style that a leader exhibits towards all members of a workgroup. An average style not being
practical, a leader divides the subordinates into in-group and out-groups and differently
towards each group. (See Fig. 18.6).
Panel (a) in Fig.18.6 portrays the traditional view of how leaders and subordinates are
perceived. All subordinates are treated equally - they have equal access to the leader, equal
influence in decision making, equal sharing of information, and equal social distance from the
Page 57 of 77
leader. Panel (b) however, reflects the vertical dyad linkage perspective, wherein the in-group
members enjoy a better relationship with the leader than the out-group members. The
differing distances of the subordinates from the leader reflect differences in the equality of
working relationships, and therefore, differences in influence, authority, and access to
information.
Why is the model called the Leader-Member Exchange theory? The theory emphasises
the social exchange that takes place between leader and followers. The social exchange
viewstate that group members make contributions at a cost to themselves and receive rewards
accordingly. Interaction continues because members find the social exchange mutually
rewarding
The LMX model has its applications in any situation where the leader is required to
influence followers; whether it is the Vice-chancellor of a university, director of a B-School, or
executive in an organisation, there are bound to be in-groups and out-groups. There is no doubt
that in-group members are more close to the boss than those belonging to the out-group. But
the problem with the model relates to the categorisation of subordinates into in-group and out-
group. Who is with in-group and who is with out-group? Is group alignment permanent? What
are the criteria to categorise an employee into one group or other? These are difficult question
for which no easy answers are available.
The Managerial Grid

A graphic depiction of a two-dimensional view of leadership style has been developed
by Blake and Mouton. They proposed a Managerial Grid based on the styles of "concern for
people" and "concern for production" which correspond to the Ohio State dimensions of
consideration and initiating structure or the Michigan dimensions of employee centred and
production-centred. Fig. 18.7 shows a diagram of the Managerial Grid.
The grid identifies five basic styles of leadership. The 9,1 (task management) leader is
primarily concerned with production and has little concern for people. This person believes in
getting work done at all costs. The 1,9 (country club management) leader is primarily concerned
with people. The 5,5 (middle of the road management) leader represents a moderate concern
for both. The 9,9 (team management) style demonstrates high concern for both production and
people and is, therefore, the ideal approach to leadership. The 1,1 (impoverished management)
has minimum concern for people and production. The model is useful to managers in as much
as it helps them identify their current styles and develop the most desirable style.
Page 58 of 77
Further development to Blake and Mouton's Grid has led to two more leadership styles
shown in Fig. 18.7. The paternalistic (father knows best) manager (9 + 9) promises reward for
compliance and threatens punishment for non-compliance. The opportunistic managen uses
the style that he or she feels will return him or her the greatest self-benefits.22
The most fundamental criticism of the grid is Blake and Mouton's argument that the 9,9
style is superior to all other styles of management. The critics say, for example, that managerial
styles based on 9,1 direction with compliance or 5,5 conformity with compromise, or on 1,9
security and comfort through convenience, or on 1,1 acquiescence and complacency, or the
"clever" but corrupt relationships produced by facades or by debilitating paternalism, are at
best, second best. Actually they are quite unacceptable, in long term. In comparison with
performance contributed under 9,9 other bases for work relationships seem to fall short.
But the belief that one leadership style is inherently superior to others is clearly contrary
to the contingency idea of leadership. It seems unlikely that the 9,9 management style is
appriate for organisations experiencing different growth rates, labour relations, competition
and a host of other differentiating problems.
Change Management
Changes in its external and internal environment constantly affect every business’s
activities. These changes can happen either at individual levels or at the organizational level.
Furthermore, it affects employees as well as managers. It is also basic human nature to resist
changes, especially drastic ones.
Page 59 of 77
Since an organization’s success depends on how well it adapts to change, management

of these situations is crucial. This is where change management comes into play.
Preventing changes is not always possible as they are inevitable sometimes. However, it is
possible to plan for changes and overcome them. The management must always strive to ensure
changes happen smoothly. The organization and its members must not find changes too drastic.
Since an organization’s success depends on how well it adapts to change, management

of these situations is crucial. This is where change management comes into play.
Preventing changes is not always possible as they are inevitable sometimes. However, it
is possible to plan for changes and overcome them. The management must always strive to
ensure changes happen smoothly. The organization and its members must not find changes too
drastic.
The Nature of Organisational Change:

It is often said that nothing is certain but death and taxes. But a third term has to be
added - change. In management, change is expected as part of organisational life. Change
refers to an alteration in the present business environment.
Some examples of organisational change are:

i. A new method of doing the work,
ii. A new product or process,
iii. A new organisation structure and
iv. Changes in personnel policy or employee benefits.
Every individual and organisation has to experience change. At times the change is
planned for. Sometimes changes are imposed — events beyond the individual’s or
organisation’s control initiate the change. In the first situation there exists a great possibility to
predict what may happen and thereby to control events. In the second situation, reaction to
unforeseen events can be the response. Since change is certain to occur, it has to be managed.
So it is necessary at the outset to examine potential sources of change.
Organisation change is defined as “any alteration in one or more elements of the

organisation”. Changes can be made in any of the following: work schedules, basis for
departmentation, span of management, overall organisation design, or people themselves.
It is also important to bear in mind that any change in an organisation may have effects
extending beyond the actual arena in which the change takes place. For example, a job
enrichment programme could require the purchase of new machinery that might, in turn, affect
other processes in the work system.
Forces for Change:
Page 60 of 77
In practice, numerous factors affect an organisation and most of these are continuously
changing. These forces leading to or causing change originate both within and outside the
organisation, as shown in Fig.15.1.
External change forces:

External forces for change derive from the organisation’s general and task
environments. External forces causing changes may include technology, competition,
government actions, economic variables and social values. Government regulations on health,
safety, and the conduct of business affect an organisation. Labour laws influence hiring, pay,
training and promotion decisions. Tax laws change.
Economic conditions- such as recession, money supplies, inflation, and interest rates —
are sources of change.
Internal Change Forces:

Pressures for change may also originate from within the organisation. In other words
various forces inside the organisation may cause change. These forces might include managerial
policies or styles, systems, and procedures; technology and employee attitudes.
For example, top management’s decision to shift its goal from long-term growth to
short-term profit is likely to affect the goals of various departments and may even lead to re-
organisation. In short, if top management revises the organisation’s goals, organisational
change is likely to result.
Causes of Organisational Change:

(A)External Pressures:
i. Change in Technology and Equipment:
Advancements in technology is the major cause (i.e., external pressure) of change. Each
technological alternative results in new forms of organization to meet and match the needs.
ii. Market Situation:

Changes in market situation include rapidly changing goals, needs and desires of
consumers, suppliers, unions etc. If an organization has to survive, it has to cope with changes
in market situations.
iii. Social and Political Changes:
Page 61 of 77
Organisational units literally have no control over social and political changes in the
country. Relations between government and business or drive for social equality are some
factors which may compel for organisational change.
(B)Internal Pressures (Pressures for Change from Within the Organisation):

i. Changes in the Managerial Personnel:
One of the most frequent reasons for major changes in the organisation is the change of
executives at the top. No two managers have the same style, skills or managerial philosophies.
ii. Deficiencies in the Existing Organization:

Many deficiencies are noticed in the organisations with the passage of time. A change is
necessary to remove such deficiencies as lack of uniformity in the policies, obstacles in
communication, any ambiguity etc.
iii. Other Factors:

Certain other factors such as listed below also demand a change in the organisation.
1. Employee’s desire to share in decision-making
2. Employee’s desire for higher wage rate
3. Improvement in working conditions, etc.
LEVELS OF CHANGE
Change can be at the individual, group, and organisational levels.
Individual-level Change:
At the individual level, change is reflected in such developments as change in job
assignment, physical move to a different location, or the change in maturity of a person which
occurs over time. It is said that changes at the individual level will seldom have significant
implications for the total organisation. This is not true because a significant change at the
individual level will have its repercussions on the group which, in turn, might influence the
wider organisation. A manager who desires to implement a major change at the individual level,
transferring an employee for instance, must understand that the change will have
repercussions beyond the individual.
Group-level Change:
Most organisational changes have their major effects at the group level. This is because
most activities in organisations are organised on a group basis. The groups could be
departments or informal workgroups. Changes at the group level can affect workflows, job
design, social organisation, influence and status systems, and communication patterns.
Managers must consider group factors when implementing change. Informal groups can
pose a major barrier to change because of the inherent strength they possess. Formal groups
can resist change, as exemplified by the resistance demonstrated by unions to the changes
proposed by the management. Because of the powerful influence that groups can have on
individuals, effective implementation of change at the group level can frequently overcome
resistance at the individual level.
Page 62 of 77
Page 63 of 77
Organisational-level Changes:
Changes at this level involve major programmes that affect both individuals and groups.
Decisions regarding these changes are generally made by senior management and are seldom
implemented by only a single manager. Frequently, they occur over long periods of time and
require considerable planning for implementation. Example these changes would be
reorganisation of the organisational structure and responsibilites revamping of employee
remuneration system, or major shifts in an organisation's object Change at the organisational
level is generally referred to as "organisational development" which will be considered later in
this Chapter.
The relationship among the three levels of change is illustrated in Fig. 22.3. It suggests
changes at any level affect the other levels. The strength of the effect will depend on the source
of change.
Page 64 of 77
The change process

Unfreezing, moving and refereeing under pin the change process which itself can be
summarised as consisting six stages
1. Becoming aware of the pressure for change

2. Recognising the need for change
3. Diagnosing the problem
4. Planning the change
5. Implementing the change
6. Following uo on the change
Page 65 of 77
Becoming aware of the pressure for change

Most organisational changes are carried out in response to or in anticipation of
pressures from inside or outside the organisation. Outside the organisation, technological
innovations act as powerful triggers for change. Within the firm, conIts arise, employees retire
or resign, and pressures mount as the organisation outgrows its old ways of doing things.
Pressures like these (or the anticipation of such pressures) demand changes in the structure,
technology, tasks, and people in the organisation.
Recognising the Need for Change:

Becoming aware of the need is not enough; managers should also recognise the need
for change. For example, as stated in the opening case, Deveshwar at ITC has set up e-choupals
and information super highway to connect the rural economy.
Diagnosing the Problem:

Recognising that change is needed is not enough: the managers must diagnose the
pressure for change be it impending bankruptcy or a new technology to determine how it may
affect the company and what the consequences will be.
For diagnosing the problem, various models are available (See Fig. 22.12). Interviews
help management probe freely into a range of possible subjects and build rapport and support
for the imminent change programme. Questionnaires are relatively easy to use with large
number of employees, and the resultant information can be quantified and easily summarised.
Survey data can also be a good starting point for gaining employees' commitment to the change
and for analysing alternative solutions. Observing the employees produces data regarding
actual behaviour (rather than reports of behaviour) and is in real time (rather than
retrospective, as are interviews and questionnaires). Finally, secondary data (such as that
regarding employee turnover or productivity) can be used for quantifying the problem.
Planning the Change: The next step is to formulate a strategy for change. As stated
earlier organisations must choose between evolutionary and revolutionary change. A firm that
pursues revolutionary change adopts a top-down change strategy. The organisation waits until
it believes that the costs of not changing exceed the costs of overcoming organisational inertia
and th introduces its master plan for change. Generally, a top-down strategy calls for
intervention at the high level of an organisation. Winding up of divisions or departments and
downsizing are examples of this type of change.
In contrast to revolutionary change, evolutionary change depends on a bottom-up

change strategy. Managers believe that the uncertainty associated with organisational change
is besr managed through an incremental process in which they continually make adjustments to
their strategy and structure. Firms opting for a bottom-up strategy prepare the organisation for
change by involving managers and employees at all levels in discussing the need for change and
diagnosing the problems facing the organisation. TOM, as stated earlier, is used to bring about
evolutionary change.
Page 66 of 77
Implementing the Change:

The next step is to implement the change. It is at this stage, the resistance to change
surfaces. There are several ways of manifesting resistance. Hostility aggression is the immediate
reaction of an individual to change. The affected employee may strike at the boss, a fellow-
worker, or even at subordinates
The individual may develop apathy towards his or her work. Having lost interest in the
work, the employee tends to indulge in spoilage of materials, excessive idling of time,
corruption valuable software, and low productivity.
Absenteeism and tardiness are also symptoms of resistance. Perhaps, these are forms of
apathy or attempts on the part of the individual to escape from his or her work environment
Separation, for example, may be an extreme illustration of this attempt to escape
The development of anxiety and tension is a sure sign that resistance exists. The
individual finds himself or herself uncomfortable, shaky, and tensed up on the job.
At the group-level, additional signs of resistance are exhibited. Slow-downs and strikes
are the usual symptoms of group resistance. Another strategy adopted by a group to resist
change restriction of output. Often great care is exercised in scheduling operations, setting
standards,and working out details of wage incentive systems, and yet at least part of the
worker forms into an informal group under a leader of its own choice. This group decides what
a work is and develops methods of keeping the non-conformist in line. The individual who starts
to respond to the incentive is held in a check by sanctions which the informal group is able to
bring to bear against him or her.
Managing Resistance:
Obstacles to change need to be managed, as change is necessary in a competitive
environment. There are six approaches to manage the resistance: (i) education and
communication, to participation and involvement, (iii) facilitation and support, (iv) negotiate an
agreement, manipulation and co-operation, and (vi) explicit and implicit coercion. Each has its
own advantages and disadvantages as shown in Fig. 22.13.
Follow-up on the Change: The final step in the change process is to evaluate the effects of the
change and to institute procedural modifications that will ensure that the change continue to
be implemented.
Page 67 of 77
UNIT – V
ORGANISATIONAL CULTURE
MEANING AND DEFINITION

By culture, we mean that complex whole which includes knowledge, belief, art, morals,
law, custom, and other capabilities and habits acquired by man in a society, two terms are key
to the concept culture: history and shared phenomenon. With regard to the first, it may be
started her cultural mores of a society are passed on from generation-to-generation. The
second of a key term which is basic to culture implies that the cultural ethos are shared among
the members of a society
Having known the meaning of culture, we may attempt to define organisational culture.
Organisational culture (or its sister term corporate culture) has been defined as the
philosophies, ideologies, values, assumptions, beliefs, expectations, attitudes and norms that
knit an organisation together and are shared by its employees.?
The following ten characteristics help us understand the nature of culture better. When
these characteristics are mixed and meshed, we get the essence of culture.
1. Individual Initiative: The degree of responsibility, freedom, and independence that

individuals have.
2. Risk Tolerance: The degree to which employees are encouraged to be aggressive, innovative,
and risk-seeking.
3. Direction: The degree to which the organisation creates clear objectives and performance
expectations.
4. Integration: The degree to which units within the organisation are encouraged to operate in
a co-ordinated manner.
5. Management Support: The degree to which managers provide clear communication,
assistance and support to their subordinates.
6. Control: The number of seas and regulations, and the amount of direct supervision that is
used to oversee and control employee behaviour.
7. Identity: The degree to which members identify with the organisation as a whole rather than
with their particular workgroup or field of professional expertise
8. Reward System: The degree to which reward allocations are based on employee
performance criteria in contrast to seniority, favouritism, and so on.
9. Conflict Tolerance: The degree to which employees are encouraged to air conflicts and
criticisms openly.
10. Communication Patterns: The degree to which organisational communication are restricted
to the formal hierarchy of authority
11. Purpose: Culture has a purpose in terms of achieving common objectives. Perceived success
will reinforce the culture and can make it stronger.
12. Pervasive: Every individual, irrespective of religion, region, race and ethnicity has a culture.
What the person is largely influenced by the culture to which he or she is a part.
Page 68 of 77
The P&G case stated above is all these characteristics

Organisational members tend to internalise cultural practices and like to indoctrinate
newcomers into such mores. Some of these practices are so thoroughly internalised that no
one questions them-they are taken for granted that is, they get institutionalised.
Besides institutionalisation, deification or glorification is another process that tends to
occur in strongly developed organisational cultures. Heroes emerge, especially among the
founding fathers the organisation, whose sacrifices, valorous deeds, and ingenuity in the
difficult initial years of the organisation or during later crises periods are embellished into
stories and sagas. The organisation itself may come o be regarded as precious in tse, a cfprie
and in some sense unique. Organisational members begin to feel a strong bond with it that
transcends material returns given by the organisation, and they begin to identify with it. The
organisation turns into a sort of clan.
CULTURAL DIMENSIONS
Over the years, a number of cultural dimensions have been identified. The more
interesting of these are as follows:
Levels of Culture:
Three levels of culture may be distinguished. These include national culture business
culture, and occupational and organisational cultures. (See Fig. 21.1). All these levels influence
the effectiveness of management
Page 69 of 77
National culture is the dominant culture within the political boundaries of the nation-
state. The dominant national culture usually represents culture of the people with the greatest
population of the greatest political or economic power. Formal education is usually taught, and
business is usually conducted in the language of the dominant culture. National culture has
considerable significance for international managers who need to manage cultural diversity.
Business culture represents norms, values, and beliefs that pertain to all aspects of
doing business in a culture. Business culture tells people the correct, acceptable ways to
conduct business in a society.
National culture impacts business culture considerably. In any society, business closely
interweave with the broader culture values, norms and beliefs. Examples include the priorities
given to age and security, the role expectations for women within a family, and expectations
concerning how those managing should behave towards subordinates
Business culture influences all aspects of work and organisational life. This includes how
managers select and promote employees, lead and motivate their subordinates, structure their
organizations, select and formulate their strategies, and negotiate with other business people,
Different occupational groups, such as physicians, lawyers, accountants and

craftspeople have distinct cultures, called occupational cultures. Occupational cultures are the
norms, values, Beliefs, and expected ways of behaving of people in the same Occupational
group, regardless of which organisation they work for. The occupational culture cannot be
ignored by the manager Just because of the dominant importance of national and business
cultures.
Organisational culture, as stated earlier, represents beliefs, attitudes and norms that
knit an organization together and are shared by its employees, as the opening case reveals
Levels of culture can be presented differently as shown in Fig. 21.2.
At the surface is the observable culture. Observable culture is manifested through

symbols was physical design, dress codes, logos, gadgets, and murals. It also includes the
unique, stories, ceremonies, and corporate rituals that make up the history of the success of
the organization
The second level includes shared values. An example of this is "quality is the
cornerstone for our success". Shared values are applicable to all organisational members and
no deviation
Page 70 of 77
is tolerated, differences notwithstanding. It is advisable that organisations have shared values

which ensure compliance.
Common assumptions stand at the deepest level of culture. These are taken-for-granted
truths that organisational members share as a result of their joint experience. It is often
extremely difficult to isolate these patterns, but doing so helps explain why culture invades
every aspect of organisational life. The common assumptions may surface in an organisational
crisis. We are different is a common assumption that permeates the practices of some
organisations
Mechanistic and Organic Cultures:

The mechanistic organisational culture exhibits the values of bureaucracy and
feudalism. Organisational work is conceived as a system of narrow specialism and people think
of their careers mainly within these specialisms. Authority is thought of as flowing down from
the top of the organisation down to the lower levels and communication flows through
prescribed channels. There is a great deal of departmental loyalty and inter departmental
animosity, a strong "we versus "they perception. This sort of culture resists change and
innovation
Contrast is the organic culture, Formal hierarchies of authority, departmental

boundaries formal rules and regulations, and prescribed channels of communications are
frowned upon. There is great deal of emphasis on task accomplishment, teamwork, and free
flow of communication formal and informal. In problem situations, the persons with expertise
may wield far more influence than the formal boss. There is a widespread understanding within
the staff, of the problems, threats, and opportunities the organisation is facing and there is
Page 71 of 77
willingness and preparedness to take appropriate roles to solve the problems. The culture
stresses flexibility consultation, change and innovation
Authoritarian and Participative Cultures:

In the authoritarian culture, power is concentrated on the leader and obedience to
orders and discipline are stressed. Any disobedience is punished severely to set an example to
others. The basic assumption is that the leader knows what is good for the organisation and he
or she always acts in its interests.
The participative culture is premised on the notion that people are more committed to
the decisions that are participatively made than to those which are imposed on them. Further,
group problem-solving leads to better decisions because several new points and information
are shared during discussions. Participative cultures tend to emerge where most organisational
members are professionals or see themselves as equals
Dominant and Sub-cultures:

Many big companies have a dominant culture and several cells of sub-cultures, which
are attached to different roles, functions, and levels. If the sub cultures are accepted, a natural
conclusion is that very few beliefs, attitudes, or values are shared by all organisational
members. A dominant culture, normally referred to as the organisational culture, reflects core
values that are shared by the majority of the employees. In effect, this is the distinctive
personality of the organisation.
By contrast, sub-cultures are found in departments, divisions, and geographical areas,

and reflect the common problems or experiences of employees who reside in these areas. A
sub culture could consist of the core values of the dominant culture as well as the values unique
to the department or area to which it relates. There could be differences and clashes between
sub-culture and another and between sub-cultures and the dominant culture as shown in
Exhibit 21.1
Strong, Weak, and Unhealthy Cultures:

Distinction is also made between strong and weak cultures in a strong culture, the core
values of the organisation are widely shared and eager embraced by a large number of
employees who are deeply committed to them.
A strong culture will have a significant influence on employee behaviour manifesting in

reduced turnover, lower absenteeism, increased cohesiveness, and positive attitudes. This so
because there is a high agreement among members about what the organisation stands for.
The result is the creation of an internal atmosphere of high behavioural control. Behavioural
control brought in by strong culture is much more powerful than the one that results from
formal rules and regulations. In addition, organisations sharing strong culture tend to perform
better than those without such a culture. In recent years, as organisations have created flatter
structures, introduced team systems of working, reduced bureaucratic control, and empowered
Page 72 of 77
employees, some would argue that the shared meaning generated by a strong culture ensures
that everyone is moving in the same direction.
Additionally, strong cultures have the following characteristics:
1. A clean philosophy exists about how business is to be conducted

2. Considerable time is spent communicating values and beliefs
3. Explicit statements are made that describe the organisation's values
4. A set of values and norms exist that are shared widely and rooted deeply
5. New employees are screened carefully to ensure that they fit with the culture.
Strong culture has dysfunctional consequences. It tends to lead to groupthink, collective
blind spots, and resistance to change and innovation. It tends to discourage diversity as strong
culture would not accommodate the diverse behaviours and strengths that people of different
backgrounds can bring to the organisation.
Weak Cultures:
A weak culture is characterised by the presence of several sub-cultures, sharing of few
values and behavioural norms by employees, and existence of few sacred traditions. In weak-
culture organization, there is little cohesion across the organisation top executives do not
repeatedly expose any business philosophy or exhibit commitment to particular values or extoll
the use of particular operating practices. Because of the lack of shared values, organisational
members have no deeply felt sense of identity. The lack of corporate identity tends to result in
few employees viewing the company as a place to work and their work as a way to make a
living
Unhealthy Cultures:
There are organisations which have unhealthy cultures. One unhealthy trait is a
politicised internal environment that allows influential managers to operate autonomous
'fiefdoms' and resist needed change. In politically dominated cultures, many issues get resolved
on the basis of turf, vocal support or opposition by powerful executives, personal lobbying by a
key executive, and coalitions among Individuals or departments with vested interests in a
particular outcome. What is best for the organisation plays second fiddle to personal
aggrandisement
Another feature of unhealthy cultures is that of promoting managers who are good at
staying within their budgets, exerting close supervisory control over their units, and handling
administrative detail as opposed to managers who understand vision strategies, and culture
building and who are good leaders, motivators, and decision makers. While the former are
adept at internal organisational manoeuvring, they may lack the entrepreneurial skills an
organisation needs among its senior executives to introduce new ideas, reallocate resources,
build new competitive abilities, and fashion new culture.
Finally, unhealthy culture is also characterised by an aversion to looking outside the box
for superior practices and approaches. Sometimes, an organisation enjoys undisputed
Page 73 of 77
leadership in the industry and its managers become inbred and arrogant. It believes it has all
the answers or can develop them on its own. Insular thinking and inward-looking solutions
often precede a decline in performance. Several well-known organisations such as Bank of
America, Citicorp Ford, and Xerox had unhealthy cultures during the late 1970s and early 1980s.
Kmart and Sears, and L&T in India are said to exhibit unhealthy cultural traits now.
Our discussion from now onwards centre's around organisational culture.
SUSTAINING THE CULTURE (404)

Having created culture, it needs to be kept alive in the organisation. There are strategies
which organisations employ to sustain their cultures. Such approaches include selecting and
socialising employees, actions of founders and leaders, culturally consistent rewards, managing
The cultural network and maintaining stable workforce. (See Fig. 21.4).
Selecting and Socialising Employees: The main purpose of hiring process is to hire right
people for right jobs. When, for a given job, two or more candidates, with identical skills and
abilities are available, final selection is influenced by how well a candidate fits into the
organisation. By identifying candidates who can jell with the organisational culture, selection
helps sustain culture considerably.
Job applicants too look at an organisation from its culture perspective before seeking
entry. In fact, more than pay and perquisites an organisation offers, its cultural artifacts which
often attract or detract job seekers.
Along with selecting people with compatible values, companies maintain strong culture
through the effective socialisation of new employees. Organisational socialisation refers to the
process by which individuals learn the values, expected behaviours, and social knowledge
necessary to assume their roles in the organisation.
Page 74 of 77
Socialisation can be conceptualised as a process made up of the RH encounter and

metamorphosis. The first stage encompasses all the learning that occurs before a new member
joins the organisation. In the second stage, the new employee w ith organisation is really like
and confronts the likelihood that expectation and reality diverge. In the third stage, is really
long-lasting changes take place. The new employee masters the skills required for his or her
new roles, and makes the adjustment to his or her work group's values and norms.
Actions of Leaders and Founders:

We have already stated the role of leaders in creating organisational culture. We
emphasise that the founders and leaders play a significant role in sustaining organisational
culture. Founders are visionaries whose energetic style provides a powerful role model for
others to follow. The founder's cultural imprint often remains with the organisation for
decades. For example, the culture at Microsoft calls for working exceptionally long hours,
because that is what the co-founder Bill Gates has always done.
In spite of the founder's effect, subsequent leaders can break the organisation away
from the founder's values if they apply the transformational leadership concept described in
Chapter 18. Transformation leaders strengthen organisational culture by communicating and
enacting their vision of the future. Cultural values are pertinently reinforced when leaders
behave in ways that are consistent with the vision.
Culturally consistent Rewards:

Reward systems strengthen corporate culture when they are consistent with cultural
values. Aggressive cultures might offer more performance -based individual incentives, whereas
paternalistic cultures would more likely offered employee assistance programmes, medical
insurance, and other benefits that support employee well-being.
Managing the Cultural Network:

Organisation's culture is learned, so an effective network of cultural transmission is
necessary to strengthen the firm in underlying values and beliefs. The cultural network exists
through the organisational grapevine. It is o n e touch frequent opportunities for interaction so
that employees can share stories and re-enact rituals.. Senior executives must tap into the
cultural.network, sharing their own stories and creating new ceremonies and other
opportunities to demonstrate shared meaning. Company magazines and other media can also
strengthen organisational culture by communicating cultural values and beliefs more
effectively.
Maintaining a Stable Workforce:

An organization's culture is embedded in the minds of its employees. The director of a
B-School in Bangalore was aghast when a retired employee appeared one morning at his
(Director's office and told him that he came to the school because he dreamt about it the
previous night. Organisational stories are rarely written down; rituals and celebrations do not
usually exist in manuals; organisational metaphors are not found in corporate directories. Thus,
organisations depend a stable workforce to communicate and reinforce the dominant beliefs
Page 75 of 77
and values. The organisation's culture can literally disintegrate during periods of high turnover
and downsizing because the corporate memory leaves with these employees. Organisational
culture also weakens during periods of rapid expansion or mergers because it takes time for
incoming employees to learn about and accept the dominant corporate values and beliefs. For
this reason, some organisations keep their culture intact by moderating employee growth and
checking turnover problems.
ORGANISATIONAL DEVELOPMENT
Organisational development (OD) comprises a special set of organisational change
methods. It is a planned, systematic process of organisational change based on behaviour
science research and theory. The goal of OD is to create adaptive organisations capable of
transforming and reinventing themselves, so as to remain effective. As a field of behavioural
science, OD draws heavily from psychology, sociology, and anthropology. OD relies on
information from personality theory, learning theory, and motivation theory (all discussed in
earlier chapters), and on inputs from group dynamics, power, leadership, and organisational
design. It is based on many well-established principles regarding the behaviour of individuals
and groups in organisations. In sum, OD rests on many of the facets of OB presented in this
book.
OD is not a single approach but a collection of techniques that have a certain philosophy
and body of knowledge in common. The basic characteristics of OD are the following:
1. Planned Change: Also called change intervention, it makes OD different from other
approaches for change in organisation.
2. Comprehensive Change: OD efforts generally involve a total system. The change covers the
entire organisation.
3. Emphasis upon Workgroups: Although some OD efforts are aimed at individual and
organisational change, most are oriented towards groups. There is a sociological flavour to
much of OD.
4. Long-range Change: OD takes months or years to implement. The OD process is not intended
to be stopgap measure.
5. Participation of a Change Agent: The services of an outside expert are generally retained to
implement the OD process. 'Do it yourself programmes are discouraged.
6. Emphasis on Intervention: The OD approach results in an active intervention of change agent
in the ongoing activities of the organisation.
7. Collaborative Management: In contrast to the traditional management structure in which
orders are issued at upper levels and simply carried out by lower levels, OD stresses
collaboration among levels. Organisations are viewed in a system perspective.
8. Organisational Culture: As we pointed out in the chapter on organisational culture, culture
includes the following: accepted patterns of behaviour, norms, organisation objectives, value
systems, and the like. OD recognises that each organisation is different from all others and that
problem-solving process varies across organisations. Assumption that a particular solution can
be applied to numerous organisations is thus generally not made; instead, the culture of each
organisation must be understood and relations consistent with that culture must be developed.
Page 76 of 77
9. Action Research: The process of identifying the organisation's specific problem gathering and
analysing organisational data, and taking action to resolve problem constitutes 'action
research'. It is in sharp contrast to 'hypothesis testing research, which deals with problems or
situations that are of interest to organisations generally but which may not be relevant to a
specific organisation.
Characteristics of OD:
The salient characteristics of OD implied in its definitions are gleaned as follows:
First, OD is a systematic approach to the planned change. It is structured style of
diagnosing organisational problems and opportunities and then applying expertise to them.
Second, OD is grounded in solid research and theory. It involves the application of our
knowledge of behavioural science to the challenge that the organisations face.
Third, OD recognizes the reciprocal relationship between individuals and organisations.
It acknowledges that for organisations to change, individuals must change.
Fourth, OD is goal oriented. It is a process that seeks to improve both individual and
organisational well- being and effectiveness.
Fifth, OD is designed to solve problems.
Objectives of OD::
The main objectives of OD are to:
1. Improve organisational performance as measured by profitability, market share,
innovativeness, etc.
2. Make organisations better adaptive to its environment which always keeps on changing.
3. Make the members willing face organisational problems and contribute creative
solutions to the organisational problems.
4. Improve internal behaviour patterns such as interpersonal relations, intergroup
relations, level of trust and support among the role players.
5. Understand own self and others, openness and meaningful communication and
involvement in planning for organisational development.
Douglas McGregor, who was working in the Union Carbide, is considered one of the first
behavioural scientists to systematically talking about and advocating for the implementation of
OD for organisational improvement. OD as a subject is relatively new. Notwithstanding, it is
becoming increasingly popular and visible in USA, UK, Japan, Norway, Sweden and even in
India.
In India, OD is in scene since 1968. Since then, many public and private sector
organisations like HAL, HMT, IDPL, LIC, SAIL, TELCO and TISCO have been applying the
interventions of OD to solve the organisational problems.
Page 77 of 77

004 Core 8 - Organizational Behaviour - III Sem BBA

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

004 Core 8 - Organizational Behaviour - III Sem BBA

Uploaded by

Copyright:

Available Formats

STUDY MATERIAL FOR BBA

UNIT CONTENT PAGE Nr

IV LEADERSHIP STYLES AND THEIR IMPLICATIONS 44

Organizational Behavior (OB) is the study of human behavior in organizational settings,

Nature and Importance of OB:

1. A separate field of study: Organizational Behavior is a separate field of study. Many

2. It is an applied science: The aim of OB it to solve problems of organizations related with

3. An Interdisciplinary Approach: Organizational behavior is essentially an interdisciplinary

4. A Normative Science: Organizational Behavior is a normative science also. While the

5. A Humanistic and Optimistic Approach: Organizational Behavior applies humanistic

behavioral scientists to analyze human behavior in view of his/her socio-psychological

a. OB provides a road map to our lives in organizations.

This experiment revealed that there is no relationship between lighting and

2.Relay Assembly Test Room Experiments:

3.Mass Interviewing Programme:

4.Bank Wiring Observation Room Experiments:

1. An informal relationship is responsible for deciding the human behavior.

System Approach to Management

EVALUATION OF SYSTEMS APPROACH

Individual behavior can be defined as how an individual behaves at work. A person’s

The factors influencing individual behavior are –

There is a positive association between age and satisfaction. However, changes in

Creative individuals possess at least three categories of attributes, background

Background experience matters much to make an individual creative. It is well

Cognitive abilities are an individual's power to think intelligently and to analyse

Emotions and Emotional Intelligence:

Four features are common to all emotions:

3. Culture determines expression of feelings-Notwithstanding the fact that people exhibit

The most common emoticons are as follows

LEARNING - EXPLICIT AND TACIT KNOWLEDGE

HOW LEARNING OCCURS?

Cognitive Theory of Learning

Social Learning Theory

Observational learning involves several processes as shown in Fig. 9.4.

A few definitions on the concept of attitude are as follows:

Another way of categorising values is as follows:

The importance of morale are

STEPS TO IMPROVE MORALE IN AN ORGANIZATION

Good Behaviour of Authorities:

Provision of Financial and Non-Financial Incentives:

Workers Participation in Management:

acceptance, and interest.

B. Safety or Security Needs

E. Self -actualization Needs

Herzherg’s Motivation-Two Factor Theory

j. Relationship with peers

Motivational force formula

Vroom’s Expectancy Theory:

Application of the Vroom’s Expectancy Theory

Common goal or interest:

Interaction and Interdependency:

Social exchange theory offers an alternative explanation for group development.

1. Adjourning. Not all groups experience this stage of development because it is

1. Incomplete assessments of the problem,

Self-Oriented: Focused on personal needs regardless of group concerns. Examples: aggressor,

Group Decision Making:

Approaches to Group Decision Making

Autocratic decision making:

Expert member soliciting:

Consultative decision making:

1.Styles Based on Authority Retained

Styles Based on Task versus People Emphasis (Task oriented)

a. Establishing channels of communication.

Depending on task emphasis or people emphasis, four combinations are possible as