Chapter 7: Motivation Concepts

One defines motivation as a reason for engaging in a particular behavior towards attaining a
goal. It relates to 3 key concepts: direction, intensity and persistence of human behavior.
Intensity=how much one tries, direction= it leads to the desired outcome, persistence=how
long one tries.

Early theories of motivation

Hierarchy of needs – Maslow pyramid

1st level -> Psychological – hunger, thirst, shelter, sex

2nd level -> Safety – security, protection

3rd level -> Social – friendship, belonging

4th level -> Esteem – respect, status, recognition

5th level -> Self-actualization – self- fulfilment

Lower order needs (psychological, safety) must be first satisfied so high-order needs (the rest)
can be attained. One cannot move from satisfying psychological needs directly to social,
because safety needs were not satisfied. Higher-order needs are often satisfied internally
(within the person), lower-order needs are satisfied externally (pay, tenure) Later, Maslow’s
theory of needs was elaborated to ERG theory. This theory proposes only 3 core needs –
existence, relatedness and growth.

Theories X (negative) and Y (positive)

This theory is based on manager’s assumptions of their employees. Theory X is full of

assumptions such as: employees are lazy, dislike their work, everything is somebody’s fault,
employees’ interest in job is restricted to just being paid, employee cannot be trusted. Theory
Y is based on assumptions such as: employees may be ambitious, motivated, can handle work
autonomy, can be given authority and be empowered. In terms of Maslow hierarchy, higher-
order needs dominate individuals in theory Y, lower-needs dominate in theory X.

Two-factor theory (motivation-hygiene theory)

Theory developed by F. Herzberg. His studies proved that certain factors cause job satisfaction
and a separate set of factors cause job dissatisfaction. Hygiene factors are: status, job security,
salary, fringe benefits – if these factors are present, a worker won’t be dissatisfied. If they are
absent, workers will be dissatisfied. There are as well motivation factors: challenging work,
recognition, responsibility, and empowerment. These factors give positive satisfaction. Despite
many criticisms, this theory is widely known by managers.

McClelland’s Theory of Needs

It focuses on 3 needs: need for achievement (nAch), need for power (nPow) and need for
affiliation (nAff). These needs are subconscious. Researches focus mainly on nAch and the
relationship between nAch and job performance. Critique: the theory has less practical
approach than others and applying and measuring concept in practice is expensive and time-
consuming.

Contemporary theories of motivation

Goal-setting Theory

This theory claims that providing specific, challenging and interesting goals, while giving
constant feedback, results in better outcome. Acceptance of a goal, however hard it can be to
achieve, results in higher effort to achieve it.

Why are we ‘attracted’ to difficult goals?

1. Because a difficult goal focuses us, makes us concentrate on it and diminishes distractions.

2. A difficult goal makes us more energetic and more hard- working because indeed we need
to work better, harder to accomplish it.

3. Difficult goal equals more determination in pursuing it.

4. Difficult goal equals invention, finding new working methods to be more effective and
efficient. In this whole process, feedback serves as guidance, check list of things that are done
and need to be done.

Self-generated feedback is more effective than externally- generated feedback. There are also
other factors that influence goal-setting effect: a) Goal commitment b) Task characteristic c)
National culture. One can implement a programme called management by objectives (MBO) –
setting SMART goals (specific, measurable, actionable, realistic and tangible). Elements of
MBO: goal specificity, participation in decision making process, time period and feedback.
MBO is similar to the goal-setting theory, only differ in participative goal-setting vs. manager
assigned goals. MBO may not work due to unrealistic expectation, lack of commitment or the
inability/unwillingness to reward according to goal accomplishment.

Self-efficacy Theory
Developed by Albert Bandura. It is based on one’s confidence that he/she can
perform/achieve a goal. The higher one’s belief in succeeding (that is the higher one’s self-
efficacy), the higher one’s motivation and response to feedback. There are four methods of
enhancing self-efficacy: enactive mastery-relevant experience with the task/job, vicarious
modeling- gaining confidence by watching others performing the task, verbal persuasion-
someone persuades you that you can succeed, and the enhancement of positive emotional
responses by the reduction of stress reactions (arousal). Training programs use enactive
mastery. The Galatea effect means communicating expectations directly to employees and
self-fulfilling of this expectation.

Reinforcement Theory

It is opposite to goal setting theory, indicating that behaviors are environmentally caused. Not
a motivation theory, but widely considered when discussing about motivation.

Equity Theory

Equity was perceived from the employee’s standpoint in the past (distributive justice), but
now is increasingly perceived from the organisation’s standpoint (organisational justice).

Expectancy Theory

Developed by Victor Vroom. Vroom's theory assumes that behavior results from conscious
choices among alternatives whose purpose it is to maximize pleasure and to minimize pain.
Expectancy is the belief that increased effort will lead to increased performance i.e. if I work
harder then this will be better. Focuses on 3 relationships:
Effort-performance relationship (“The harder I try, the better outcome will be”)

Performance-reward relationship (“The more TVs I sell, the higher bonus I will get”)

Reward-personal goal relationship (“The higher bonus I get, the better car I will buy”)

Chapter 8: Motivation - applications

Job Characteristics Model

Job Redesign

 Job rotation (employee is performing different tasks at different times, tasks shift,
employee moves from one job to another which requires the same skills level). Reduce
boredom, increase motivation, increase flexibility as employees have more skills. But it
increases training costs, creates disruptions, reduce productivity.

 Job enlargement (employee is performing more different and various tasks, his work is
becoming more diverse and it horizontally widened) The application of job enlargement
is not always successful, as employees may dislike the job even more.

 Job enrichment (vertical widening of one’s job, adding activities from different expertise
fields, e.g. controlling, leading, planning, implementing, one has more responsibilities
and independence). Reduces absenteeism, turnover costs, increase satisfaction, but
doesn’t work very well in productivity.

Alternative work arrangements

Flextime – flexible time work

Job sharing – two or more workers share a 40-hour week job

Telecommuting – working from home

Ability and opportunity

Performance may be calculated as = (ability x motivation x opportunity to perform).

Opportunity to perform means absence of barriers that may limit the performance of an
employee

Employee involvement programs

Participative management – joint decision making between employees are their supervisors
Representative participation – representation of employees who participate in organizational
decision making instead of all workers participating in decision making, in form of works
councils and board representatives.

Quality circles – volunteer group composed of workers who meet to talk about workplace
improvement, and make presentations to management with their ideas, especially relating to
quality of output in order to improve the performance of the organization, and motivate and
enrich the work of employees.

Rewards as motivators

What to pay? Pay structure -> process of establishing pay level to balance internal and
external equity. Pay more: better qualified, motivated and longer loyalty, but leads to very
high cost.

How to pay? More and more organizations use variable-pay programs – refers to
compensation that is received in addition to the base pay. The amount received may be linked
directly to individual, team, division and/or organization performance, and is determined
(typically) by a variety of measures important to the organization.

 Piece-rate pay – employees is paid stable price for each unit of completed production.
Limitation: not feasible and realistic for many jobs.

 Merit-based pay – pay plan that is performance-related. It provides bonuses for workers
who perform their jobs better, according to measurable criteria. Limitation: only valid
upon the performance evaluation on which it is based; dependant on the pay raise pool,
resisted by (trade) unions.

 Bonuses – pay plan rewarding employees for latest performance (not past)

 Skill-based pay - employees are paid on the basis of the number of job skills they have or
have acquired or number of jobs they can perform. Limitation: the organization may pay
the employees for acquiring skills which are not immediately needed.

 Profit-sharing plan - various incentive plans introduced by businesses that provide direct
(cash) or indirect (stock) payments to employees that depend on company's profitability
in addition to employees' regular salary and bonuses

 Gainsharing - program that returns cost savings to the employees, usually as a lump-
sum bonus. It is a productivity measure, as opposed to profit-sharing which is a
profitability measure
  Employee stock ownership plan – plan in which employees can buy company’s stock for
below-market prices as benefits.

What benefits to offer? Flexible benefits enable employers to select the benefits that suit
them. There are also 3 main types of benefits plan: modular plans, core-plus plans and flexible
spending plans.

How to construct employee recognition programs? – Intrinsic rewards

Financial motivators (pay plans, wage) are effective in short-term, while intrinsic rewards are
crucial motivator in long-term. Intrinsic rewards can be just informal thank you as well as the
whole formally developed program. Intrinsic rewards plans are inexpensive but are vulnerable
to politics of management.

Chapter 9: Foundations of Group Behavior

A group is defined as two or more people coming together to achieve an objective.

Group types

 Formal group – a work group defined by organisational structure

o Command group – group composed of people who report directly to a manager

o Task group – composed of people working and aiming at completion of a task

Command groups are also task groups, but not necessarily vice versa.

 Informal group – is not formally structured, formed by the needs of social contacts

o Interest group – people working together to achieve some objective, but at the
same time each and every single member is concerned about the issue/aim

o Friendship group – people who share one or more common

features/characteristics

Reasons to join a group: security, status, self-esteem, affiliation, power and goal-achievement.

Stages of group development

1. Five-Stage model

2. An alternative model for temporary groups with deadlines. Punctuated-equilibrium

model
Five-stage model:

Stage 1. Forming: orientation, testing, dependence. Members come together to form a group.

Stage 2. Storming: conflict, emotionality, and resistance to influences and task requirements.
Members become hostile and combative. Leadership is formed during this stage.

Stage 3. Norming: in-group feeling and cohesiveness develops, new standards evolve, new

roles adopted. Members accept roles and behaviors of others.

Stage 4. Performing: the group becomes a functional instrument for dealing with tasks and
present reality. Members have established norms and are able to diagnose problems and
come up with solutions.

Stage 5. Adjourning: the group ends its existence, closure. For temporary groups, it is a stage
when members prepare for group dissolution.

Assumptions:

 What makes an effective group is more complex than the model suggests

 Groups do not have to go through all the stages, they may jump e.g. from 1st to 4th stage

 Stages may go simultaneously

 Critique: the model ignores organisational context

Punctuated-equilibrium model:

Stages:

1. Setting the group’s direction

2. First phase of group activity – inertia (inactivity, apathy, lethargy)

3. At the end of first phase a transition takes place (group has already used ½ its time)

4. Transition leads to major changes

5. Second phase of inertia follows transition

6. Group’s last meeting can be described as accelerated activity

The model does not apply to all groups, but only those which work temporarily and have a set
deadline to complete work.
Group properties

Roles: a set of expected behaviors ascribed to a person occupying a particular position in a

social unit (e.g. one can have a role of student, son/daughter, (boyfriend, worker, etc.)
Zimbardo’s Prison Experiment shows that people quickly learn/assume roles, sometimes
through stereotypes and information that mass media and other parties disseminate.

 Role identity – situation when attitudes and behaviors are consistent with a role

 Role perception – person’s vision on how he/she should behave in a certain

circumstances

 Role expectations – how other people believe one should behave in a certain situation

 Role conflict - takes place when one is forced to take on two different and incompatible
roles at the same time and as a result he/she faces conflicting role expectations

Norms: standards of behavior shared by a group’s members. Norms tell us what we should do
in particular situations. Groups, communities, units, cultures, nations have norms. There are
performance roles, appearance roles, social arrangement roles and resource allocation roles.

The Hawthorne studies proved that people behave differently if they are aware of being
watched, observed, or examined, but as a group, they don’t violate the norm established. They
also emphasised the role of norms in one’s work behavior.

As a member of a group, one often experiences the conformity phenomenon – it is the

adjustment of one’s behavior to align with the norms of the group. There are group norms
which press us to conform with them, to be one of the group’s members.

Deviant workplace behavior is intentional behaviors that violate organizational norms, which
threatens the members and well-being of an organization (e.g. wasting resources, sabotage
properties, spreading rumours, sexual harassment). Individuals who belong to a group are
more likely to engage in deviant behaviors.

Size: the size of the group affects it’s functioning. Smaller groups tend to be faster, but larger
groups are better for complex problem-solving issues. General rule may be that large groups
can put more diverse input, but smaller groups do it more productive. The concept of social
loafing appears. This concept states that individuals try less when working in a group than
when working individually. To prevent this phenomenon the following tactics can be used: a)
set group goals, b) increase competition within a group, c) set an evaluation plan – peers
evaluate peers, d) distribute group rewards.
Cohesiveness: it is a degree of members attraction to each other combined with motivation to
stay in the group. It is easier for smaller groups to achieve cohesiveness. Cohesiveness relates
to group productivity. If performance-related norms are high, a cohesive group will experience
more productivity.

What can encourage group cohesiveness? Smaller groups, consensus on common goals, more
time spent tighter by group members, enhance the group’s status, encourage competition
with other groups, reward group, not just members, physically isolate the group.

Group decision- making

Group versus individual:

PROs GROUP DECISION MAKING CONs GROUP DECISION MAKING

 Generate more complete information  Time consuming

and knowledge
 Conformity phenomenon hinters the
 More inputs to the decision making decision making process
process
 Decision may be dominated by
 Enhance diversity of views – more individual(s) in a group
perspectives, more solutions
 Ambiguous responsibility, collective
 Increased acceptance of a solution responsibility

Effectiveness:

When we take into account accuracy, group decision making is better, when speed is the
concern, then individual decision making is more effective, In terms of creativity, groups will
also bring more to the table.

Efficiency:

It takes longer for a group to make a decision than it does for an individual.

There are two phenomena that can take place in group decision -making: groupthink and
groupshift.
Groupthink is exhibited by group members trying to minimise conflict and reach consensus,
which can lead to a lack of critical testing, analysing, and evaluation of ideas. Conformity
pressures are very high and group members decide to follow the ideas, thinking, and decisions
made by others. There are few signs of groupthink:

 Illusions of unanimity among group members; silence is viewed as agreement.

 Self-censorship of ideas that deviate from the apparent group consensus.

 Direct pressure to conform placed on any member who questions the group’s
consensus.

 Rationalising warnings that might challenge the group's assumptions.

Groupthink does not characterise all groups. It happens more often when the group’s identity
and cohesiveness is high. Also groups that have a negative self image are more threatened by
groupthink.

The remedies for groupthink can be:

 Monitoring the size of the group. The bigger group, the more probable the occurrence
of groupthink.

 At least one group member should be assigned the role of Devil's advocate. This should
be a different person for each meeting.

 Leaders should be impartial and should encourage different opinions and views.

 Using techniques that stimulate discussion.

Groupshift is a phenomenon in which the initial positions of individual group members

become exaggerated because of the interactions of the group. Group opinions are more
conservative than individual’s. There are risky shifts and cautious shifts. More often, the shift
is towards greater risk. The best explanation for that is that group diffuses responsibility and
the accountability objects are not clearly defined and that’s why members dare to take riskier
decisions.

Group decision- making techniques

Interacting groups are typically groups where there is face-to-face contact.

Brainstorming is the idea-generation process or creativity-technique that is meant to generate

many, different ideas in order to solve a problem. The drawback of this technique is that it is
not efficient. Individuals are more productive in this respect; as groups tend to face
“production blocking” – many people talking at once, thoughts are blocked, communication is
hampered.

Nominal group technique (NGT) is a decision making method for use amongst groups of many
sizes who want to make their decision quickly, as by a vote, but where everyone's opinions are
taken into account. Discussion and interpersonal communication are limited. NGT outperforms
brainstorming.

Steps in NGT:

1. Silent generation of ideas - members meet and write down individually ideas on a sheet of
paper.

2. Sharing ideas - each group member presents one idea to the group members. There are
turns until all ideas are shared.

3. Group discussion – the group discusses ideas and clarifies them.

4. Voting and ranking – each member ranks ideas. The idea with the biggest amount of votes
wins.

Electronic meeting or computer-assisted group:

Group members work with computers to make a decision. First issues are presented. Then,
group members type their responses. On the projection screen there are comments and
cumulated votes. Ideas that a person types, appears on the screens of the other team
members. Advantages of this technique: anonymity, speed, honesty. However, researches
showed that this method causes decreased group effectiveness, is time-consuming and leads
to lower satisfaction than face-to-face meetings.

Global consequences:

 Cultural differences affect status. It is important to know the role of status in a given
culture.

 Social loafing is consistent with individualistic cultures/societies, not with collective

ones.

 Group diversity (especially ethnical and cultural) can lead to increased conflict and low
group morale. However, if they survive initial conflicts over time diverse groups perform
better.
 Chapter 12: Leadership
First of all, the difference between management and leadership has to be explained.
Management, according to John Kotter, means coping with complexity. Leadership, however,
means coping with change. Robert House has different view on this. He thinks that
management’s job is to execute strategies set by leaders, as well as to control, take care of HR
and be busy with everyday problems.

The book defines leadership as ability to motivate, encourage a group to achieve set goals,
vision or strategy. The role of the leader may be assigned (formal) or deduced by a person
from the position he/she occupies in the organization. Managers are not equal to leaders.
Nevertheless, management needs both: effective management and effective leadership.

There are a few theories on leadership:

Trait theories on leadership

Theories based on the concept of distinguishing leaders from non-leaders on the basis of
person’s individual qualities and characteristics. These theories claim that leaders are born,
not made.

Researches have had difficulties with determining the number and naming the traits that make
a person a good leader. Then, the development of Big Five personality model made it easier
for researches. It has become noticeable that many traits attributed to leaders fall into one or
many categories of the Big Five. So, accordingly:

 Extraversion is claimed to be the most important trait of leader emergence, not

necessarily of leader’s effectiveness. Social people are the better leaders than unsocial.
Moreover, leaders that are too assertive are less effective.

 Conscientiousness and openness to experience also show strong, positive correlation to

leadership.

 Agreeableness and emotional stability are not highly related to leadership.

 Another trait, not included in the above Big Five model, is EI (emotional intelligence).
What is decisive in case of EI’s importance to leadership is EI’s core value: empathy.
Effective leaders are empathic leaders (leaders that can read other’s feelings, reactions,
are good listeners). Nevertheless, there is more research on other traits, other than EI,
and their corrections to leadership.
Summing up, person’s traits help to predict his/her leadership behaviors. Nevertheless, one
has to careful with linking traits with effective leadership, because traits are better predictor
of leaders’ emergence rather than effectiveness.

Behavioral theories

Theories based on assumptions that certain behaviors distinguish leaders from non-leaders.
The limitation of this theory can be proved by theory’s main assumption that people can be
trained to be leaders, what is obviously not complete truth. So theories proposed that
leadership can be taught.

Ohio State Studies

Ohio State Studies developed 2 dimensions of leadership behavior:

 Initiating structure - task-oriented behaviors that facilitate goal accomplishment. Extent,

to which a leader defines leader and group member roles, initiates actions, organizes
group activities and defines how tasks are to be accomplished by the group.

 Consideration – people-oriented behaviors. Extent to which a leader exhibits concern

for the welfare of the members of the group. This factor is oriented towards
interpersonal relationships, mutual trust and friendship

Leaders high in consideration make their followers more job-satisfied, motivated and more
respectful.

Leaders high in initiating structure make their followers perform better in groups.

University of Michigan Studies

Also developed 2 dimensions of leadership behavior

 Employee- oriented leaders: focus on interpersonal relations, have personal interest in

employees’ needs and recognise differences between group members. Associated with
higher group productivity, greater job satisfaction.

 Production oriented leaders: focus on task-related and technical issues. Associated with
lower group productivity and job satisfaction.

Blake and Mounton developed a managerial grid (leadership grid), a 9-by-9 matrix
representing two variables; concern for people and concern for production. It represents both
University of Michigan studies on employee and production oriented leaders and Ohio State
studies on initiating structure and consideration. The managerial grid is a good tool for
conceptualizing leadership. Leader that score 9,9 on the grid are the most effective ones.

Trait theories and behavioral theories should be combined for maximum effectiveness.
However they both lack some situational factors.

Contingency theory

This theory states that the leader's ability to lead is contingent upon various situational
factors, including the leader's preferred style, the capabilities and behaviors of followers and
also various other situational factors.

Fiedler Model

The model postulates that the leader’s effectiveness is based on ‘situational contingency’, that
is a result of interaction of two factors, known as 'leadership style' and 'situational
favourableness’ (situational control). For the purpose of the research Fiedler developed the
least preferred co-worker (LPC) questionnaire to measure whether an individual is task or
relationship oriented. On the scale 1-8, with 16 sets of adjectives employees rate their co-
workers. On this basis, the leadership style of the respondent is developed. Fiedler claims that
in reality there are combined leadership styles (both task and relationship oriented to different
degrees). After fulfilling LPC questionnaire and thus estimating leadership style, a fit between
the leadership style and situation has to be found. Fiedler defined 3 situational factors:

 Leader-member relations (either poor or good) – the better score, the better for leader

 Task structure (either high or low) – the higher structured job, the better for leader

 Position power (strong or weak) – the stronger position power, the better for leader

Together, there are 8 categories the leader can fall into. To change the state of art (in case of
ineffectiveness), the leader or the situation can be changed.

 The model has been positively evaluated. But there are some complications with LPC
questionnaire and practical application of the model.

 The recent update of Fiedler model is cognitive resource theory. The theory focuses on
the influence of the leader's intelligence and experience on his or her reaction to stress,
and states that the intelligence and experience can actually reduce stress. But it is the
degree of stress that verifies if the intelligence and experience will positively (low stress)
or negatively (high stress) influence leadership behavior.
Hersey and Blanchard’s Situational Theory

This theory states that depending on employees’ competences and commitment to task as
well as on acceptance/rejection of the leader, leadership style should vary from one person to
another. It focuses on leader’s followers. In this theory effectiveness of leader depends on
followers’ behavior. Hersey and Blanchard recognise 4 leader behaviors that depend on
followers’ readiness:

 Unable and willing – leader need to show high task-orientation and high relationship
orientation

 Unable and unwilling - leader needs to give unambiguous directions

 Able and willing – leader doesn’t do much

 Able and unwilling – leader need to use motivating, supportive leadership style

The evaluation of the theory was rather under critique. There are inconsistencies in the model
and issues with research techniques.

Critique of contingency theories – they do not take into account followers. Leadership does not
when it is considered only from the perspective of a leader, because leadership is a relation
between a leader and followers. In reality, leaders act differently towards different people.

Leader-member exchange (LMX) Theory

Focuses on the two-way relationship between supervisors and subordinates. Leaders often
develop relationships with each member of the group that they lead, and Leader-Member
Exchange Theory explains how those relationships with various members can develop in
unique ways. In the group, there are in-groups – trusted followers to who leader pays more
attention an out-groups – followers who get less attention, time, and rewards. The
relationship between a leader and out-groups are more formally set than those between a
leader and in-groups. It is the leader who classifies certain followers to in-groups or out-groups
at the beginning of a group’s functioning. This classification is usually driven by
absence/presence of common characteristics. This relationship is rather stable.

It is claimed that people in leader’s in-group and the leader share more common features than
in case of people in leader’s out-groups.

The evaluation of this theory was rather positive. It is true that leaders do make distinctions
between followers. In-groups have better performance, higher satisfaction, more support for
leader and higher citizenship behavior.
Decision Theory: Vroom and Yetton’s Leader-Participation Model

Relates leadership behavior and participation to decision making. Provides a set of rules to
determine the form and amount of participative decision- making in different
situations. There are now 12 contingency variables in the latest revision of this model. This
model is often too complicated for managers/leaders to actually put into place in
organizations.

Leaderships in Europe:

Three clusters identified:

Cluster 1: The Anglo culture (UK & Ireland). Focus on results. Leaders empower and motivate
people

Cluster 2: Scandinavian, focus on relationships. Similar values to cluster 1, but differ in the
general quality of life, instead of competitive individualism in cluster 1.

Cluster 3: Mediterranean cluster: leaders are expected to be more powerful.

Europe leadership can also be clustered as East and West. Western Europe is also clustered in
north and south with differences in leadership style and perception

Global consequences - differences in leadership around the world:

Brazil: managers in Brazil need to team-oriented, participative and caring. Leaders in Brazil are
people-oriented, are high on consideration level.

France: leaders over there need to be high in structure; initiating, task-oriented, better
directive style of leadership rather than participative or supportive.

Egypt: similar to Brazil with the difference in power distance. There is a clear status and power
distinction between leader and followers.

China: High-performance orientation combined with high level of consideration. There are also
status differences expectations. The best option: moderately participative style.
 Chapter 13: Power and Politics
What is power?

Power refers to the potential of the influence that a person/party can exert on another
person/party so that it acts in a way that the influencer wants. It can exist, but not be used. It
is based on a dependency variable.

Relationship between power and leadership

Leaders use power as a mean to achieve goals. Power just needs dependability, while
leadership requires goals compatibility between leader’s and his/her followers’ goals.

Bases of power

Formal power:

Based on one’s position in an organisation.

- Coercive power: power dependent on fear. A person acts in a way because he/she fears of
outcomes of incompliance. This power bases on threat of application e.g. sanction,
restrictions, pain, dismissal and so on.

- Reward power: can be gained from one's capacity to reward compliance. People comply with
directives, orders because compliance generates positive benefits. There are those who
reward and those who see it as valuable. It is the opposite of coercive power.

- Legitimate power: a formal power one gains by holding a particular position in an

organization, includes both coercive and reward power. In OB context, it is probably the most
common.

Personal power:

Power originating from a person’s characteristics.

Expert power: power that is based on unique skills or know-how/knowledge.

Referent power: individual power based on a high level of identification with, admiration of,
or respect for the powerholder (e.g power of celebrities)

Personal bases of power are most effective. They relate positively to satisfaction,
organisational commitment and performance. Coercive power causes less satisfaction and less
commitment.
Dependency: Relation between A and B - The greater B depends on A, the greater power A has
over B.

Dependency is inversely proportional to the alternative resources e.g. among the famous
people, fame is no longer a power. In the business context, an example of suppliers can be
given - many suppliers are better than one.

What creates dependency? It is the resources’…

 Importance

 Scarcity

 Impossibility of substitutes

Power tactics

Power tactics are ways in which a person uses power in specific situations.

There are 9 different influence tactics:

(1) Legitimacy

(2) Rational persuasion

(3) Inspirational appeal

(4) Consultation

(5) Exchange

(6) Personal appeals

(7) Ingratiation – using flattery, praise

(8) Pressure

(9) Coalitions

Research has proved that rational persuasion, inspirational appeal and consultation are the
most effective. Pressure is probably the least effective. Combination of many may be helpful.
The effectiveness of those tactics depends on the influence’s direction e.g. rational persuasion
works only in upward influence. Moreover, the order of tactics matter. It’s better to start with
“softer”. Using just one soft tactic works better than using just one hard tactic and the best
way of all is to combine many soft tactics.
People differ in their political skills. More politically skilled are more effective users of power
tactics. Moreover, organizational culture influences the acceptance or refusal of some power
tactics.

Politics: Power in action

Organisational Politics

 Political behavior is used to describe “activities that are not required as part of a
person’s formal role in the organization but that influence or attempt to influence, the
distribution of advantages and disadvantages within the organization” (page 381). This
definition includes decision- making process as the’ distribution of advantages and
disadvantages’.

 There are 2 dimensions of political behavior: legitimate political behavior (normal day-
to-day politics, e.g. complain to supervisor, form coalitions) and illegitimate political
behavior (political actions, decision which violate rules, are abusive e.g. sabotage).

The reality of politics: organizations are politics-loaded because of competition for scarce,
limited resources as well as disagreement between different parties in many issues. Politics
exists because there is a lot ambiguity in interpreting facts and some people
use politicking (using influence to support facts aiming at achieving their interests).

Causes and consequences of political behavior:

Factor encouraging political behavior can be individual or organizational.

 Individual factors: some traits, qualities are connected with political behavior. These
traits are high self-monitoring, internal locus of control, High Machiavellian personality,
organizational investment, perceived job alternatives, expectations of success.

 Organisational factors: factors resulting from organizational culture and internal,

working environment. Certain cultures do promote political activity. Organizational
factors that promote political behaviors are: resource reallocation, promotion
opportunities, low trust, role ambiguity, vague evaluation system, zero-sum reward
practices (win/lose approach), democratic decision making, high performance pressures,
self-serving senior managers.

People’s responses to organizational politics:

For most people in the organization, outcomes of politicking are negative. Organizational
politics may threaten employees. It correlates to decrease in job satisfaction, increase of
anxiety and stress, increased turnover and lower performance. Apart from these relations,
there is also correlation between politics influence and understanding or organizational
politics mechanisms. If an employee knows the politics in a firm, he know why certain
decisions are made and by whom. If the understanding is high and politics level is high then
employees perceive politics as opportunities and their performance increases. Nevertheless,
low understanding means perceiving organizational politics as a threat and then employees
feel threatened response with defensive behaviors (action performed to avoid action, blame
or change). People from politically unstable countries are used to political issues and their
tolerance is higher.

Impression management (IM):

IM is the process through which people try to control the impressions other people form of
them. Only people high in self-monitoring are IM concerned. IM is usually used in job
interviews and performance evaluations. To IM techniques belong: flattery, excuses, favors,
self-promoting, apologies, association, and conformity, which some works better than the
others. Impression Managers must be careful to avoid being perceived as manipulative or
insincere, since the impressions conveyed about them are not always false.

Global challenges:

 Politics perceptions have rather negative effects around the world

 People from different cultures prefer different power tactics

 Effectiveness of power tactics differ between cultures.

Chapter 14: Conflict and negotiation

Conflict is the process initiated when one party perceived as about to be, or being negatively
affected by another party on something that the first party cares about.

School of thoughts on conflict:

Traditional school of conflict assumes that conflict must be avoided at all costs and that it
causes group’s functioning deterioration. The conflict is perceived as dysfunctional, bad,
violent.

Human relations school of conflict assumes that conflict is a natural response and should be
accepted as such. Still, the theory argues it cannot be avoided and sometimes can be
functional.
Interactionist school of conflict argues that minimum level of conflict benefits group’s
performance. Conflict is viewed as helpful to avoid group’s stagnation, apathy. Conflict is
something necessary.

The theory distinguished between functional and dysfunctional conflicts. Functional conflicts
help the group, while dysfunctional worsen its operation.

It also distinguishes between task, relationship and process conflicts. Relationship conflicts are
usually dysfunctional. Low levels of process conflicts as well as low/moderate levels of task
conflicts are functional.

The conflict process

Stage 3 – Intentions

Conflict-handling intentions: competing, collaborating, compromising, avoiding and

accommodating.

 Competing - assertive and uncooperative –parties want to satisfy their interests

 Collaborating - assertive and cooperative –parties want to reach agreement that

satisfies everyone

 Compromising – moderate level of assertiveness and cooperativeness – parties are

willing to resign from some of their postulates/potential benefits

 Avoiding – unassertive and uncooperative – withdrawal or suppression

 Accommodating – unassertive and cooperative – readiness to take another party’s

interest as superior and place them above own concerns.

Stage 4 – Behavior

Party’s behavior and other’s reactions. Conflict becomes visible. One should pay attention to
conflict-intensity continuum – the higher the conflict level, the more intense the reaction. High
level of conflicts usually implies dysfunctional outcomes. There are however conflict
management techniques which can minimize or stimulate the conflict level to reach the
required conflict degree.

 Conflict-resolution techniques: problem- solving, compromise, resources expansion,

superordinate goals, smoothing, avoidance, authoritative command, altering the human
variable and altering the structural variables.
  Conflict-stimulation techniques: communication, outsiders’ appearance, organizational
restructure, devil’s advocate appointment.

Negotiation: Bargaining strategies

Distributive bargaining

The different parties are trying to divide something up-distribute something, creation of
win//lose situation. The parties assume that there is not enough to go around, and they
cannot "expand the fixed pie," so the more one side gets, the less the other side gets. In OB
context, the best example is wage negotiation.

The process of distributive bargaining involves 2 negotiators. Each of them has his target (most
acceptable situation) and resistance point (the least acceptable situation) as well as aspiration
range (area between these 2 points where negotiation can take place).

Some hints on how to negotiate in distributive bargaining:

 Make the first offer, it should be aggressive (recall anchoring bias)

 Reveal a deadlin

Integrative bargaining

The parties are trying to make more of something. Creation of win/win solutions. It is
preferable to the distributive bargaining because it builds relations.

There must be some conditions for integrative bargaining to succeed: parties involved in
negotiations need to be flexible, open, sensitive about others’ needs and value information-
sharing.

 Teams bargain more in integrative style than individuals

 When more issues are under negotiation, more likely win/win situation will appear

 Compromise does not almost implies win/win outcomes because it reduces need for
integrative bargaining

The negotiation process

1) Preparation and planning -> ‘doing homework’, results in BATNA (best alternative to a
negotiated agreement) – the least acceptable situation

2) Definition of ground rules

3) Clarification and justification

4) Bargaining and problem solving

5) Closure and implementation

What individual differences influence a negotiation’s effectiveness?

 Personality traits – lack of strong evidence, but some of them indicate that certain traits
of The Big Five are connected to negotiation processes Agreeable and extraverted
negotiators do not perform well in distributive bargaining. Also intelligence seems to
influence bargaining.

 Moods/emotions – yes, depends on the bargaining type. In distributive bargaining, angry

negotiators perform better. In integrative bargaining positive moods/emotions have
positive influence.

 Gender – women and men negotiate similarly, but gender affects negotiation’s
outcomes. Men are supposedly slightly better negotiators than women. Women are
exposed to stereotype threat, if they do not confirm they are blamed for breaking
gender stereotype. Women may also more influenced by their own attitudes and
actions.

Third-party negotiations

 Mediator – A neutral party who assists in negotiations and conflict resolution, the
process being known as mediation

 Arbitrator - legal technique for the resolution of disputes outside the courts, wherein
the parties to a dispute refer it to one or more persons, by whose decision they agree to
be bound. Arbitrator has authority to dictate the agreement.

 Conciliator - parties to a dispute agree to utilize the services of a conciliator, who then
meets with the parties separately in an attempt to resolve their differences (serves as
informal communication link between parties)

 Consultant – is a trained in conflict management third party who tries to assist creative
problem solving by communication and proper analysis.