Organizational Behaviour

GOOD/BAD EXPERIENCE?

You ordered a soft drink and a sandwich. The person who served you
was abrupt and unpleasant. They didn't smile or make eye contact, and
continued their conversation with colleagues, instead of asking if you
wanted anything else. They slapped your change on the counter rather
than put it in your hand, then turned away. You have used this café
before, but you have never been treated so badly.

What's the issue and how it makes you feel?.

Why need to study Behaviour?

▪ Diversity: Recognizes the differences and value of workforce diversity, enabling

managers to understand and appreciate cultural differences and practices.
▪ Quality and productivity: Helps improve quality and employee productivity by
empowering people and designing effective change programs.
▪ People skills: Provides specific insights to improve a manager's people skills, such as
communication, motivation, and leadership.
▪ Coping with change: In times of rapid and ongoing change, it can help managers
cope in a world of "temporariness" and stimulate innovation.
▪ Ethical work climate: Can guide managers in creating an ethically healthy work
environment by promoting fairness, respect, and integrity.
Other Study Fields:

• Organization Theory, Industrial Sociology, Organizational Psychology, Organizational

Analysis, Organization Studies.

• Organization Theory and Industrial Sociology tend to focus on macro-level studies of

groups and organizations.

• Organizational psychology specializes in individual behaviour.

• Organizational Analysis tends to emphasize practice rather than theory.

• Organization Studies is a term which highlights the widening of the range of issues and
perspectives that this field now embraces.
What is Organizational Behaviour?

• Organizational Behavior is a field of study that investigates the impact that

individuals, groups and structure have on behavior within organizations, for
the purpose of applying such knowledge toward improving an
organization’s effectiveness.
• The knowledge gained from OB can be applied to improve organizational
effectiveness.
• OB focuses on improving productivity, reducing absenteeism and turnover,
and increasing employee citizenship and job satisfaction
How OB define the Café Issue:

How can we explain your experience in the café? We can blame the
personality and skills of the individual who served you. However, there are
many other possible explanations such as:

Inadequate staff training Anxiety about anticipated

Staff absences increasing working
pressure
Long hours, fatigue, poor work-life
balance
Equipment not working properly
organizational changes
Domestic difficulties – family feuds,
ill-health
Low motivation due to low pay
An autocratic supervisor/disputes
Why to Study Organizational Behaviour?

• To learn about yourself and how to deal with others

• You are part of an organization now, and will continue to be a part of
various organizations
• Organizations are increasingly expecting individuals to be able to work in
teams, at least some of the time
• Some of you may want to be managers or entrepreneurs
What makes Organizational Behaviour Important?

• Is a way of thinking.
• Is multidisciplinary.
• There is a distinctly humanistic orientation with OB.
• The field of OB is performance oriented.
• The external environment is seen as having significant impact on OB.
 Behavioural Contribution Unit of Output
science analysis
Learning
Motivation
Perception
Training
Leadership effectiveness
Job satisfaction
Psychology Individual decision making
Performance appraisal
Attitude measurement
Employee selection
Work design
Work stress
Individual

Group dynamics
Work teams
Communication
Power
Conflict
Intergroup behaviour
Sociology

Formal organization theory Study of

Organizational technology Group Organizational
Organizational change Behaviour
Organizational culture

Behavioural change
Attitude change
Social psychology Communication
Group processes
Group decision making
Organization
Comparative values system
Comparative attitudes
Cross-cultural analysis
Anthropology
Organizational culture
Organizational environment

Conflict
Political science Intraorganizational politics
Power
We Can Explain – but We Cannot Predict
What Outcome to be expected?

• Manager should be able to articulate, comprehend, anticipate, and

manage the conduct of individuals within the organization:

• Articulate: Should be able describe and pinpoint the behaviour of

individuals under his command.
• Comprehend: Must understand as to why people behave in particular
manner and try to identify reasons.
• Anticipate: Should be able to handle each individual differently so that
his or her actions can be channelized to higher productivity
• Manage: Lay down control measures so that the energy of workers is
diverted towards organizational objectives
 Management Publication Concept of
S.No. Key Theorist Brief Summary of Major Components
Theory Date Theory

Classical
Focuses on the efficient division of labor and
1 Management Adam Smith 1776 Division of Labor
specialization to increase productivity
Theory

Scientific Focuses on breaking down tasks into smaller

Efficiency in
2 Management Frederick Taylor 1911 parts, analyzing and optimizing each part for
Work Processes
Theory efficiency, and standardizing work processes

Proposes five functions of management:

Administrative Principles of
3 Henri Fayol 1916 planning, organizing, commanding,
Theory Management
coordinating, and controlling

Social and Focuses on understanding and meeting the

Human Relations
4 Elton Mayo 1933 Psychological social and psychological needs of workers to
Theory
Needs of Workers improve productivity

Recognizes the importance of informal

Organizational Informal organizations within formal organizations and
5 Chester Barnard 1938
Behavior Theory Organizations how they can influence behavior and
productivity

Focuses on a hierarchical and formal

Bureaucratic Organizational
6 Max Weber 1947 organizational structure to improve efficiency
Theory Structure
and effectiveness

Views organizations as complex systems of

Ludwig von Interconnectedne
7 Systems Theory 1950 interdependent parts that must work together
Bertalanffy ss of Components
effectively

Focuses on setting specific goals that are

Management by
8 Peter Drucker 1954 Goal-Setting measurable and achievable to improve
Objectives
performance
 Management Publication Concept of
S.No. Key Theorist Brief Summary of Major Components
Theory Date Theory

Focuses on the process of rational decision-making,

Rational Decision-
9 Decision Theory Herbert Simon 1957 including identifying alternatives, evaluating
Making
consequences, and choosing the best option

Proposes two contrasting assumptions about workers:

Management
Theory X and Douglas Theory X assumes workers are lazy and need to be
10 1960 Assumptions
Theory Y McGregor closely monitored, while Theory Y assumes workers
About Workers
are self-motivated and enjoy their work
Non-Linear
Proposes that small changes in one part of a system
Systems and
11 Chaos Theory Edward Lorenz 1963 can have large and unpredictable effects on the system
Complex
as a whole
Behavior
Fit Between Proposes that the most effective management
Contingency Environment & approach depends on the specific situation, such as the
12 Joan Woodward 1965
Theory Management size of the organization, the industry, and the goals of
Approach the organization

Matching Suggests that the most effective leadership style

Contingency
13 Fred Fiedler 1967 Leadership Style depends on the situation, and proposes a model for
Theory
to the Situation matching leadership style to the situation

Situational
Paul Hersey and Adapting Proposes that effective leaders adapt their leadership
14 Leadership 1969
Ken Blanchard Leadership Style style based on the maturity level of their followers
Theory

Servant Focus on Service

Robert
15 Leadership 1970 and Focuses on serving the needs of others
Greenleaf
Theory Empowerment

Clarifying Goals Focuses on how leaders can clarify goals, remove

16 Path-Goal Theory Robert House 1971 and Removing obstacles, and provide support to help their followers
Obstacles achieve their goals
 Management Publication Concept of
S.No. Key Theorist Brief Summary of Major Components
Theory Date Theory

Transformational James Inspiring and Focuses on leaders who inspire and motivate their
17 Leadership MacGregor 1978 Motivating followers to achieve more than they thought was
Theory Burns Followers possible

Identifying and
Theory of Focuses on identifying and removing constraints in
18 Eliyahu Goldratt 1984 Removing
Constraints business processes to improve overall performance
Constraints

Value Creation Emphasizes the importance of creating value for

Stakeholder R. Edward
19 1984 for Multiple multiple stakeholders, including customers,
Theory Freeman
Stakeholders employees, suppliers, and society as a whole

Continuous
Total Quality Focuses on continuous improvement, customer
W. Edwards Improvement
20 Management 1986 satisfaction, and the involvement of all employees in
Deming and Customer
Theory quality management
Satisfaction

David Emphasizes a positive and strengths-based approach

Appreciative Positive Change
21 Cooperrider and 1987 to change management, focusing on what is working
Inquiry Management
Suresh Srivastva well and building on existing strengths

Elimination of
Lean Focuses on the elimination of waste and continuous
Waste and
22 Management Taiichi Ohno 1988 improvement of processes to increase efficiency and
Continuous
Theory productivity
Improvement

Combines principles of Lean Management and Six

Combining Lean
23 Lean Six Sigma Various 1990 Sigma to improve quality and eliminate waste in
and Six Sigma
business processes

Knowledge Effective
Focuses on the creation, transfer, and utilization of
24 Management Ikujiro Nonaka 1991 Management of
knowledge within an organization
Theory Knowledge
 Management Publication Concept of
S.No. Key Theorist Brief Summary of Major Components
Theory Date Theory
Proposes that firms can gain a competitive advantage
Strategic
Resource-Based by managing their resources strategically, such as
25 Jay Barney 1991 Resource
View Theory through developing unique capabilities or acquiring
Management
rare resources

Managing in Emphasizes the importance of flexibility and

Margaret
26 Chaos Theory 1992 Chaotic adaptation in managing in chaotic and unpredictable
Wheatley
Environments environments

Emotional Emotional Recognizes the importance of emotional intelligence

27 Intelligence Daniel Goleman 1995 Intelligence in in effective leadership, including self-awareness, self-
Theory Leadership regulation, motivation, empathy, and social skills

Knowledge Ikujiro Nonaka Creating and

Focuses on how organizations can create, share, and
28 Management and Hirotaka 1995 Sharing
use knowledge to improve their performance
Theory Takeuchi Knowledge

Emphasizes the complexity and unpredictability of

Complexity Understanding
29 Ralph Stacey 1996 organizational systems, and proposes new ways of
Theory Complex Systems
understanding and managing them

Eliminating
Lean James Womack Focuses on eliminating waste in business processes to
30 1996 Waste in
Management and Daniel Jones increase efficiency and productivity
Processes

Proposes that organizations can develop and leverage

Dynamic Adaptive
dynamic capabilities, or the ability to adapt and
31 Capabilities David Teece 1997 Resource
change their resources and capabilities over time, to
Theory Management
achieve sustained competitive advantage

Emphasizes a flexible and iterative approach to project

Agile Flexible Project
32 Various 2001 management, allowing for frequent changes and
Management Management
adaptations to the project scope and deliverables
 Management Publication Concept of
S.No. Key Theorist Brief Summary of Major Components
Theory Date Theory

W. Chan Kim Focuses on creating new markets by identifying and

Blue Ocean Creating New
33 and Renée 2005 exploiting "blue ocean" opportunities, which are
Strategy Markets
Mauborgne untapped markets with high potential

Proposes a new system of organizational governance,

Self-Organizing
34 Holacracy Brian Robertson 2007 emphasizing self-organizing teams and distributed
Teams
decision-making

Emphasizes a human-centered approach to

Human-Centered
35 Design Thinking Tim Brown 2008 innovation, focusing on understanding user needs and
Innovation
designing solutions to meet those needs

Provides a visual framework for designing and

Business Model Alexander Business Model innovating business models, including key
36 2008
Canvas Osterwalder Innovation components such as customer segments, value
propositions, and revenue streams

Applying Game Uses game design principles and techniques to engage

37 Gamification Various 2010 Design Principles employees and customers, and improve business
to Business processes and outcomes

Rapid Emphasizes rapid prototyping and testing of new

38 Lean Startup Eric Ries 2011 Prototyping and business ideas, using customer feedback to refine and
Testing improve the product or service

Geoffrey Parker,
Focuses on building digital platforms that enable
Platform Business Marshall Van Building Digital
39 2016 multiple parties to exchange goods, services, or
Model Alstyne, and Platforms
Sangeet Choudary information
Model of Organizational Behaviour

• Individual Level
• Group Level
• Organization Level
Individual Level

• Behavior analysis is a complex field that is impacted by various factors, including

one's environment, upbringing, and job setting. Every individual's behavior is
distinct, and modifying it may require different stimuli.

• External incentives like money, recognition, or rank can be effective in influencing

behavior and enhancing employee productivity and job satisfaction. However,
managers must comprehend each employee's specific needs and employ
appropriate methods to meet them to ensure long-term success.

• The complexity of human behavior and mental processes makes them challenging
to measure and predict accurately. Therefore, managers must rely on their
knowledge of the individual, past experiences with them, and organizational
culture to make informed predictions about behavior.
Individual Level

• No two individuals are alike and they behave different in similar situations. In
relation to work, individuals differ in the following respects:

• Intrinsic/Extrinsic rewards: Employee praise is intrinsic reward. It's about inner

happiness, not stuff. Extrinsic rewards are hygiene-related and boost monetary
compensation. Intrinsic reward changes human behavior permanently. Monetary
awards maintain motivation but do not boost it. Even though the scenario is the
same, workers behave differently.

• Compensation: Compensation is another factor, where most of the individuals

have their own way of expression, while some workers would appreciate the
mega work the management is doing in running the organization and be satisfied
with the reward or the compensation they are getting while the others may be
unhappy and resort to various grievance.
Individual Level
Individual Level - Biographical Characteristics

• Biological and Individual Factors

• Certain factors which are inherited by an individual
• Physical appearance, way of talking, analyzing, and taking initiative.
• Physical attributes of a person are important in work environment.
• Manager will be able to deal with each of individual employees effectively if
able to identify the factors.
• Age
• Important factors to generate productivity.
• The relationship between job and performance is an issue of increasing
concern.
• Younger employees are expected to be more energetic, adventurous,
ambitions and risk takers.
Individual Level - Biographical Characteristics

• Old people are considered to be more conservative, having slow speed of work
and are less adaptable.
• Job performance and turnover declines with increasing age and therefore less
job opportunities, hence there are less of resignation.
• Older people generally get higher wages, longer paid vacation and they stick
on to the job because of pensionary benefits.
• Productivity is related to attitude and behaviour of employees irrespective of
age factor. Speed, agility, strength and coordination reduces by age.
• Experience, the older employees enjoy is of a great significance, disadvantages
caused due to declining age is off set by experience.
Individual Level - Biographical Characteristics

• Gender
• Traditionally some jobs were reserved for females like nursing jobs.
• Over a passage of time, there gender differentiation has abolished.
• We observe successful female entrepreneurs
• No difference for skills that are required for problem solving, analytical skills,
competitive drive, motivation, sociability and learning ability. It has been
established that women are more willing to conform to authority.
• As far as turnover is concerned, there is no difference between men and
women.
Individual Level - Biographical Characteristics

• Culture:
• Play an important role in determining various aspects of individual behaviour.
• Great impact on individual who have been brought up in culture concerning
moral, ethics and a code of conduct.
• Culture determine individual attitude towards work and compensation.
• Employees having high cultural value are generally found to be hard working,
honest, dependable, sociable, who can fit in the organization well.
• They are productive, innovative and think well of the organization.
Individual Level - Biographical Characteristics

• Marital Status:
• Marriage imposes increased responsibilities on an individual,
• Individual desires to have a steady job.
• Number of dependents is also a factor to be considered.
• There is no clear-cut information about the impact of marital status on productivity
absenteeism, turnover and job satisfaction.

• Tenure:
• Referred to as experience
• Work experience - good indicator of employee productivity
• Positive relationship between seniority and job performance and negative relationship
between seniority and absenteeism
• Employee turnover is negatively related to seniority
• Seniority and experience is a better indicator of job satisfaction than the age
Individual Level - Biographical Characteristics

• Ability:
• Ability is individuals’ capacity to perform various tasks in a job. Ability is made up of two sets of skills

• Intellectual ability: It is an ability of a person that is required to do mental activities. Higher IQ is not
necessary to perform the job successfully.

• Number Aptitude: A person having number aptitude displays speed, accuracy and arithmetic inclination in
the work.
• Verbal Comprehension: It refers to ability to understand what is heard or read. It is relationship of words to
each other.
• Perceptual Speed: It is an ability to identify visual similarities and differences.
• Inductive Reasoning: The ability is related to individual’s skill to identify logical sequence in a problem and
later solve the same.
• Deductive Reasoning: The ability refers to use of logic and assess the implications of an arguments. People
with this skill can ideally foot the bill as supervisors.
• Spatial Visualization: It is an ability to imagine how an object would look if its position were changed.
• Memory: It is an ability to recall past experience.
Individual Level - Biographical Characteristics

• Physical Ability:
• Physical ability refers to strength factors
• Other factors relate to stamina.
• It is the responsibility of the manager to identify physical skills in the individual and assign them
suitable jobs commensurate with their ability.
Individual Level – Emotional Intelligene

• Framework of Emotional Competence:

Individual Level - Learned Characteristics

• Learned Characteristics:
• Personality: Personality is sum total of ways in which an individual reacts and
interacts with others.
• Environment: It refers to culture in which a person is raised.
• Heredity: Heredity is transmitted through genes. Traits are characteristics of an
individual when exhibited in large number of situations. More
• Attitude: Tendency to act/think in certain ways either favourably or unfavourably
• Values: Values are beliefs that guide actions and judgments across a variety of
situation
Developing an OB Model

• Objective is to understand, predict and control human behaviour.

• Behavioral approach is used for controlling human behaviour
• Basics of OB model is an individual because same individual changes his behaviour based
on norms that has been associated with different situations.
• For e.g. High productivity is directly related to high job satisfaction while employee
turnover and absenteeism is inversely proportionate to productivity and job satisfaction.
• Dependent Variables: Productivity, Job satisfaction, Absenteeism, Turnover
• In Dependent Variables: Individual Variables, Group Variables, Structural Variables
(command & control)
Developing an OB Model

• Types Of Models Of Organizational Behaviour:

• Models have been developed considering input, process and output.

• Fuedal Model: Treats employees inferior, based upon Theory X where actions, polices and procedures are
considered superior to human beings.
• Autocratic Model: Autocratic model is based on the concept that managers are superior. Autocratic model
believes in power and authority of the manager
• Custodial Model: Custodial model imply that owners are custodian of resources in the organization and they are
bound to look after the welfare of employees. It considers that assets of organization belong to industrialist,
managers and employees in equal measures and that nobody has monopoly rights.
• Supportive Model: Employees are considered active workers who have their value, attitude, desire, and
preferences. Leaders use attitude and value system of employees to motivate them.
• Collegial Model: Collegial model refers to body of persons having common objective. The basis of the model is
the partnership of the employees with owners.
• Human Value Model: The natural process of behaviour is Stimulus, Organism, Behaviour and Consequence. It is generally
known as SOBC. Every organization should provide enough incentives in the form of intrinsic and extrinsic stimuli.
• Contingency Model: Contingency model of organizational behaviour refers to complex variables that influence individual,
group and organizational structures.
Personality

• Personality is a very complex and multidimensional construct of a human

being.
• Determinants of Personality:
• Heredity: transmitted through genes
• Environment: individual is born and brought up in a particular environment. Environment leaves
an imprint on the personality of an individual.
• Situation: person-situation interaction.
Personality

• The Myers-Briggs Type Indicator (MBTI) is based on four dichotomies,

resulting in 16 possible personality types. The four dichotomies are:
• Extraversion (E) vs. Introversion (I): measures whether individuals tend to focus on the outer
world (extraversion) or their inner world (introversion).
• Sensing (S) vs. Intuition (N): measures how individuals prefer to gather information, whether
through concrete, tangible details (sensing) or abstract, conceptual ideas (intuition).
• Thinking (T) vs. Feeling (F): measures how individuals make decisions, whether through
logical, objective analysis (thinking) or subjective, value-based considerations (feeling).
• Judging (J) vs. Perceiving (P): measures how individuals prefer to approach the external
world, either in a planned, organized way (judging) or in a spontaneous, adaptable way
(perceiving).
Personality

• On the basis of the answers the individuals are classified into following
categories
• Visionary
• Organizer
• Conceptualizers

• Types of Personality
• Type A
• Type B

• CLASS ASSIGNMENT
Learning

• Learning brings relatively permanent change in human behaviour that occurs

as a result of experience
• All complex behaviour is a learned behaviour
• If we want to predict and explain behaviour, we must understand how people
learn.
• Theories of Learning:
• Classical Conditioning – behaviourist theory
• Ivan Pavlov carried out this experiment in three sequential stages.