CHAPTER 1:

INTRODUCTION

1.1 HISTORICAL FOUNDATIONS OF ORGANIZATIONAL BEHAVIOR

As organizations increased in size and complexity, the need for human concern increased.
Different management theorists studied employees’ needs and motives or behavior in an
organization and the impact of employee behavior on productivity. Casual or common
sense approaches to obtaining knowledge about human behavior are inadequate.
Underlying the systematic approach is the belief that behavior is not random. It is caused
and directed toward some end that the individual believes rightly or wrongly, is in his
best interest. Behavior generally is predictable if we know how the person perceived the
situation and what is important to him or her. While people’s behavior may not appear
rational to an outsider, there is reason to believe it usually is intended to be rational and it
is seen as rational by them. Certainly there are differences between individuals. Placed in
similar situations all people do not act alike. However, certain fundamental consistencies
underlie the behavior of all individuals that can be identified and then modified to reflect
individual differences.
A. Scientific Management Theory (F.W.Taylor)
Taylor was considered as the father of the principles of scientific management. His
primary concern was to increase productivity through greater efficiency in production
and increase in payment for workers. The scientific management approach was concerned
with:-
 developing a standard method of doing a job
 assigning workers to jobs depending on their abilities
 training workers on the work method
 eliminating interruptions and
 offering economic incentives
Taylor described how the scientific method could be used to define the “one best way”
for a job to be done.
B. Behavioral Management Theory
The proponents of behavioral school recognized employees as individuals with concrete
human needs as part of the work groups and as members of a large society. Employees
are assets that can be developed not nameless robots expected to follow orders blindly.
Robbert owen: - a successful textile mill manager in Scotland considered as the father of
modern personnel management. He emphasized that management should show concern
for employees.
Elton mayo and his Hawthorne experiment:- with out any question, the most important
contribution to the human relations movement with in organizational behavior came out
of the Hawthorne studies undertaken at the western electric company.
The study attempts to predict behavior by studying the relationship between physical
variables in the work environment such as illumination, rest periods, length of work
weeks, length of work periods, and employee productivity. The second relationship
studied the relationship between non physical variables such as improved human
relations, supervisory methods, social interaction, incentive systems, workers’ authority,
and productivity.

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Mayo attempted to show that man is an emotional animal, non logical being who often
reacts unpredictably to the work environment and finally said social factors determine
human behavior.
Abrham Maslow- a humanistic psychologist
He proposed a theoretical hierarchy of five needs; physiological, safety, social, esteem
and self actualization needs. From a motivation standpoint, he argued that each step in the
hierarchy must be satisfied before the next can be activated and that once a need is
substantially satisfied, it no longer motivates behavior.
C. Contingency Management Theory
This theory is based on the premises that managers prefer actions or approaches
depending on the variables of the situation they face. It recognizes that there is “no one
best way” to manage people in organizations and no single set of simple principles that
can be applied universally. A contingency approach to the study of OB is intuitively
logical because organizations obviously differ in size, objectives, and environmental
uncertainty. Similarly, employees differ in their values, attitudes, needs, and experiences.
Therefore, it would be surprising to find that there are universally applicable principles
that work in all situations, but it is one thing to say “it all depends.”
1.2 The Nature and Meaning of Organizational Behavior
Organizational behavior (OB) is a field of study that investigates the impact of
individuals, groups, and organizational structure on behavior with in organizations for the
purpose of applying such knowledge towards improving an organization’s efficiency. Let
us break the definition down and see each term included in it thoroughly.

OB is a field of study which means it is a distinct area of expertise with a common body
of knowledge. It studies three determinants of behavior in organizations: individuals,
groups, and structure. Moreover, OB applies the knowledge gained about individuals;
groups and the effect of structure on behavior so as to enable organizations perform more
effectively.

To sum up, OB is concerned with the study of what people do in an organization and how
that behavior affects the performance the organization. It is academic disciplines that can
help managers make good decisions while working with people in a complex and
dynamic environment.
Developing an organizational behavior model
When organizational researchers study human behavior, they usually try to draw
conclusions about casual relationships of two (dependent & independent) variables-what
causes what.
A model is an abstraction of reality; a simplified representation of some real world
phenomenon. There are three levels of analysis in OB. As we move from the individual
level to the organization systems level, we add systematically to our understanding of
behavior in organizations. The three basic levels are analogous to building blocks-each
level is constructed on the previous model. Group concepts grow out of the foundation
laid in the individual section; we overlay structural constraints on the individual and
group in order to arrive at organizational behavior.
The basic OB model

Organizational system level

Group level
Individual level
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Dependent variables: - are those which are caused by independent variables. The
primary dependent variables given by different scholars are; productivity, absenteeism,
turn-over and job satisfaction. We use these as the critical determinants of human
resource’s effectiveness in an organization.
Absenteeism: - is failure to report to work. It is obviously difficult for an organization to
operate smoothly and to attain its objectives if employees fail to report to their jobs.
Levels of absenteeism beyond the normal range in any organization have a direct impact
on that organization’s effectiveness and efficiency. We can conceive of situations where
the organization may benefit by an employee voluntarily choosing not to come to work.
For instance, fatigue or excess stress can significantly decrease an employee’s
productivity .In jobs where an employee needs to be alert- surgeons and air line pilots are
obvious examples- it may well be better for the organization if the employee does not
report to work rather than show up and perform poorly.

A high rate of turnover in an organization means increased recruiting, selection, and

training costs. All organizations, of course, have some turnover. Turn over is for the good
of the organization when low performing workers are leaving and high performers come
in.

Job satisfaction is the difference between the amount of rewards workers receive and the
amount they believe they should receive.

Independent variables: - is the presumed cause of some change in the dependent

variable. The major determinants of productivity, absenteeism, turn over and job
satisfaction are independent variables at different levels of OB model.
Individual level variables: - people enter organizations with certain characteristics that
influence their behavior at work. The common ones include- personality characteristics,
value, attitudes and basic ability levels.
Group level variables: - people’s behavior when they are in groups is different from their
behavior when they are alone. The individual in groups are expected to exhibit what the
group considers to be acceptable standard of behavior and the degree to which the group
members are attracted to each other.
Organization system variables: - just as groups are more than the sum of their individual
members; so are organizations more than the sum of their member groups.

1.3 Organizational Behavior and Management

As stated earlier, OB applies the knowledge acquired about individuals, groups and the
effect of structure on behavior in order to make organizations work more effectively.
what people do in an organization shows their behavior and how such behavior exhibited
while on work affects ,either positively or negatively, the performance of the
organization. OB is specifically concerned with employment related situations.
Management is working with and through individuals and groups to accomplish
organizational goals.
Generally, management is there in every organization to:-
 govern the actions of its members towards enhancing their productivity for the
attainment of organizational goals
 Create conducive work environment by encouraging appropriate work habits
(culture) among its members.
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  Work with and through people for the common good of the members.
 Coordinate the efforts of the organization for higher performance level.
Thus, management uses OB to have the knowledge to be utilized in organizational
situations for solving work related social problems.
1.4 Organizational Behavior and the Work Place
Organizational behavior is a discipline that can assist managers make appropriate
decisions while working with and through individuals and groups in complex and
dynamic work place.
Realities of the new work place
1. The work force is changing:- managers in a work place must be prepared to deal
with a workforce with a change in diversity, ethnic, racial backgrounds, gender,
age, life style and abilities.
2. Consumer expectations are changing:- in today’s market place only those
organizations that are able to deliver what customers want in terms of quality,
service and cost will prosper.
3. Organizations are changing: - organizations are changing and will continue to
change in order to survive and prosper in a rapidly changing environment. Under
different pressures nowadays we see organizations down sizing, forming
alliances, creating new structures, going global and employing more
technologies.
1.5 Managers and Organizational Behavior
Managers need to develop their interpersonal or people skill if they are going to be
effective in their jobs. Organizational behavior focuses on how to improve productivity,
reduce absenteeism turn over and increase employee job satisfaction. To develop valid
generalization about the behavior of people, OB uses systematic study to improve
behavior predictions that would be made from intuition alone. Since people are different,
we have to look at OB in a contingency framework using situational variables to
moderate cause effect relationships. OB offers a number of challenges and opportunities
for managers.

OB recognizes differences and helps managers see the value of work force diversity and
practice that may need to be made when managing in different countries. It can also help
managers learn to cope in a world of temporariness and declining employee loyalty in
terms of rapid and ongoing changes.
1.6 Organizations and Organizational Behavior
Organizations are mechanisms through which many people combine their efforts together
to accomplish more than any one person could do alone.
The organization as open system:-
Resource inputs organization product output
 Human -transformation process -goods & services
 Financial -work activity
 Material
 Information
 Facilities
 Equipments
As open system organizations interact with their environment.
1.7 Nature of Managerial Work

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In the early part of 1960’s Heneri Fayol wrote that all managers perform five
management functions- planning, organizing, commanding, coordinating and
controlling .Today, authors condensed these down to four- planning, organizing,
leadership and controlling.

In the late 1960’s Henery Mintizberg concluded that managers perform ten different
highly inter related roles or sets of behaviors attributable to their jobs.
1. Interpersonal Roles: - all managers are required to perform duties that are ceremonial
and symbolic in nature.
A. figurehead- symbolic head –required to perform a number of routine duties of
legal or social nature. e.g. Attending official ceremonies.
B. leadership- responsible for the motivation & direction of subordinates
C. liaison- maintains a network with important people and groups. e.g.
acknowledgement of mail, external board work
2. Information Roles: - all managers receive and distribute information in an
organization.
A. monitor- receives wide variety of information, serves as nerve center of internal
and external information of an organization. e.g. handling all mail and contacts
categorized as concerned primarily with receiving information.
B. disseminator-transmits information received from outsiders or from other
subordinates to concerned parties. e.g. forwarding mail in to organization for
informational purposes; verbal contacts involving information flow to
subordinates such as review sessions
C. spokes person- transmitting and sharing relevant information with outsiders by
representing the organization. e.g. an organization’s plans, actions, policies, and
the like
3. Decisional Roles: - all managers are required to make decisions.
A. Entrepreneurship- initiates and oversees new projects that will improve their
organization’s performance. E.g. strategy and review sessions involving initiation
or design of improvement projects
B. disturbance handler- engaged in resolving conflicts
C. resource allocator- allocates various resources in an efficient manne
D. negotiator- dealing with other parties representing the organization
E.g. contract negotiation
Still another way of considering what managers di is to look at the skiils or competencies
they need to successfully attain their goals. Three essential managerial skills are:-
1. Technical skill:- the ability to apply specialized knowledge or expertise
2. Human skill: - the ability to work with, understand and motivate other people.
3. Conceptual skill:-the mental ability to analyze and diagnose complex
situations.
1.8 Challenges and Opportunities for Organizational Behavior
There are a lot of challenges and opportunities to day for managers to use OB concepts.
Some of the more critical issues confronting managers for which OB offer solutions or at
least some meaningful insights towards solutions are:
1. Improving quality and productivity- most managers are confronting the
challenges to having to improve their organizations’ productivity and the quality
of the products and services they offer.

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 2. Improving people skill- since managers work with and get things done through
others, they must have good human skills to communicate, motivate and delegate.
OB theories and concepts can help managers explain and predict the behavior of
people at work.
3. Managing work force diversity- organizations are becoming heterogeneous in
terms of gender, race, and ethnicity. But the term encompasses anyone who varies
from the so called norm. Mangers should shift their philosophy from treating
every one alike to recognizing differences and responding to those differences in
ways that will ensure employee retention and greater productivity-while, at the
same time not discriminating. Diversity, if positively managed, can increase
creativity and innovation in organizations as well as improve decision making by
providing different perspectives on problems.
4. Responding to globalization- managers are increasingly likely to be assigned in
foreign country and even in one’s own country, managers find themselves
working with bosses, peers, and subordinates who were born and raised in
different cultures.
5. Empowering people- nowadays managers put employees in charge of what they
do previously. Managers encourage their employees to participate in work related
decisions. Now managers are going considerably further by allowing employees
full control of their work.
6. Stimulating innovation and change- employees can be the impetus for
innovation & change. Today’s successful organizations must foster innovation
and master the art of change or they will become candidates for extinction.
Victory will go to those organizations that maintain their flexibility, continually
improve their quality and beat their competition to the market place with a
constant stream of innovative products and services.
7. Coping with temporariness- managers are required to deal with flexibility,
spontaneity, and unpredictability. Managing today would be more accurately
described as long periods of ongoing change, interrupted occasionally by short
periods of stability. The world that most managers and employees face today is
one of permanent temporariness. Workers need to continually update their
knowledge and skills to perform new job requirements.
8. Declining employee loyalty- an important challenge for managers would be to
devise ways to motivate workers who feel less committed to their employers
while maintaining global competitiveness.

1.9 Disciplines that Contributed to OB

OB is an applied behavioral science that is built on contributions from a number of
disciplines such as psychology, sociology, social psychology, anthropology and political
science.
1. Psychology- is the science that seeks to measure, explain, and some times change
the behavior of human and other animals. Psychologists concern themselves with
studying and attempting to understand individual behavior. Those which
contributed and continue to contribute to the knowledge of OB include learning,
motivation, personality, perception, training, leadership effectiveness theorists
and the like.
2. Sociology- whereas psychologists focus their attention on the individual,
sociologists study the social system in which individuals fill their roles; that is,
sociology studies people in relation to their fellow human beings. Specifically
sociologists have made their greatest contribution to OB through their study of
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 group behavior in organizations, particularly formal and complex organizations.
The following are among the major contributors to OB. Group dynamics, work
teams, communication, power, conflict, inter group behavior and others.
3. Social psychology- is an area with in psychology, but blends concepts from both
psychology and sociology such as behavioral change, attitude change group
processes and so on.
4. Anthropology- it studies societies to learn about human beings and their
activities. The work of anthropologists on cultures and environments, for instance,
has helped us understand differences in fundamental values, attitudes and between
people in different countries and within different organizations. It focuses on
comparative values and attitudes cross cultural analysis, organizational culture
and environment.
5. Political science- this one deals with the behavior of individuals and groups with
in a political environment. Areas such as conflict, intra- organizational politics,
power and others are investigated here.