1

Introduction to
the Field of
Organizational
Behavior

Copyright 2015 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
Quicken Loans
Quicken Loans has become one
of Americas most successful
companies through high
involvement, a focus on
creativity, a strong culture, and
other effective organizational
behavior practices.

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Organizational Behavior
and Organizations
Organizational behavior
The study of what people think, feel, and do in
and around organizations

Organizations
Groups of people who work interdependently
toward some purpose
Collective entities
Collective sense of purpose

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Why Study OB?
Satisfy the need to understand and predict
Helps us to test/improve personal theories
Influence behavior get things done
OB improves an organizations financial
health
OB is for everyone

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Organizational
Effectiveness
The ultimate dependent
variable in OB
Old approach achieving
stated goals
Problem with goal
attainment
Could set easy goals
Company might achieve
wrong goals

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Four Perspectives of
Organizational Effectiveness

Open Systems Perspective

Organizational Learning
Perspective
High-Performance WP Perspective

Stakeholder Perspective

NOTE: Need to consider all four perspectives when

assessing a companys effectiveness

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Open Systems
Perspective
Organizations are complex systems that
live within, and depend on, the external
environment
Effective organizations
Maintain a close fit with changing conditions
Transform inputs to outputs efficiently and
flexibly

Foundation for the other three

organizational effectiveness perspectives

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Open Systems
Perspective
External
subsystem
Accountin Environment
g
Technological subsyste
m
Raw subsystem
Products/service
m te
sys

sub
sub
materials y ste s
subs

sys
Transforming inputs to

m
m
Engineerin
Human

te
outputs
g Shareholder
resources subsystem su em dividends
bs Marketing /
ys
Manageria
Information t Sales
l Community
Pu bsy

subsyste
su

subsystem
rc ste

m subsystem
support
ha

Finances
si n m
g

Equipment Productio
bs
ys
te
l
Waste/pollution
n su m ura
Cult stem
subsyste sy
sub
m Sociali
zati
subsys on
tem

Feedback Feedback

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Organizational Learning
Perspective
An organizations capacity to
acquire, share, use, and store
valuable knowledge
Need to consider both stock
and flow of knowledge
Stock: intellectual capital
Flow: org learning processes
of acquisition, sharing, use,
and storage

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Intellectual Capital
Human Knowledge that people possess and
Capital generate

Structural Knowledge captured in systems and

Capital structures

Relationship Value derived from satisfied

Capital customers, reliable suppliers, etc.

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Organizational Learning
Processes

Knowledge
Knowledge Knowledge
Knowledge Knowledge
Knowledge Knowledge
Knowledge
Acquisition
Acquisition Sharing
Sharing Use
Use Storage
Storage
Learning
Learning Communicating
Communicating Awareness
Awareness of
of Human
Human memory
memory
knowledge
knowledge
Scanning
Scanning Info
Info systems
systems Documentation
Documentation
Sense
Sense making
making
Grafting
Grafting Internal
Internallearning
learning Practices/habits
Practices/habits
(locating
(locating
Experimenting Training
Training knowledge)
knowledge) Databases
Experimenting Databases
Observing
Observing Autonomy
Autonomy to
to
apply
apply knowledge
knowledge

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Organizational Memory
The storage and preservation of
intellectual capital
Retain intellectual capital by:
Keeping knowledgeable employees
Transferring knowledge to others
Transferring human capital to
structural capital

Successful companies also unlearn

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High-Performance Work
Practices
Workplace practices that leverage the
potential of human capital
Four HPWPs (likely others)
1. Employee involvement
2. Job autonomy
3. Develop competencies (training, selection)
4. Performance-based rewards

Need to bundle them work best

together

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Corporate Social Responsibility
at MTN

At MTN Group, Africas largest mobile (cell) phone company,

employees help the community and environment through the
companys award-winning 21 Days of Yello Care program.
This photo shows MTN employees painting schools during a
recent Yello Care event.

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Stakeholder Perspective
Stakeholders: entities who
affect or are affected by the
firms objectives and actions
Personalizes the open systems
perspective
Challenges with stakeholder
perspective:
Stakeholders have conflicting
interests
Firms have limited resources to
satisfy all stakeholder needs

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Stakeholders: Values and
Ethics
Values and ethics prioritize
stakeholder interests
Values
Stable, evaluative beliefs, guide
preferences for outcomes or
courses of action in various
situations

Ethics
Moral principles/values,
determine whether actions are
right/wrong and outcomes are
good or bad

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Stakeholders and CSR
Stakeholder perspective
includes corporate social
responsibility (CSR)
Benefit society and
environment beyond the firms
immediate financial interests
or legal obligations
Organizations contract with
society

Triple bottom line

Economy, society,
environment

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Globalization
Economic, social, and cultural connectivity
with people in other parts of the world
Due to better communication and
transportation systems
Effects of globalization on organizations
Larger markets, lower costs, more innovation
Increasing diversity
Increasing work intensification, less work-life
balance (24/7 schedule)

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Increasing Workforce
Diversity
Surface-level vs deep-
level diversity
Implications
Better knowledge,
decisions, representation,
financial returns
Manage challenges of
diversity (e.g. teams,
conflict)
Ethical imperative of
diversity

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Emerging Employment
Relationships
Work/life balance
Minimizing conflict between work and nonwork
demands

Virtual work
Using information technology to perform ones
job away from the traditional physical workplace
Telecommuting issues of social isolation,
emphasis on face time, employee self-motivated

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Organizational Behavior
Anchors
Systematic research anchor
OB knowledge is built on systematic
research
Evidence-based management rely on
research evidence, not fads, untested
assumptions

Multidisciplinary anchor
Many OB concepts adopted from other
disciplines
OB develops its own theories, but scans
other fields

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Organizational Behavior
Anchors (cont)
Contingency anchor
A particular action may have different
consequences in different situations
Need to diagnose the situation and select
best strategy under those conditions

Multiple levels of analysis anchor

Individual, team, organizational level of
analysis
OB topics usually relevant at all three
levels of analysis

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 1
Introduction to
the Field of
Organizational
Behavior

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