ORGANIZATIONAL BEHAVIOR

LS Department
Dorelene Villanueva Dimaunahan, MscM, CFE

CHAPTER 1

ORGANIZATIONAL BEHAVIOR

Organizational Behavior
Involves the actions of INDIVIDUALS and GROUPS in an
organisational context
Focuses on acquiring, developing and applying the
KNOWLEDGE & SKILLS of PEOPLE
INDIVIDUAL, INTERPERSONAL and ORGANIZATIONAL factors
determine the behaviour and ultimate value of people in an
organisation

Strategic Approach to OB
Organizational Factors
(culture, work environments, adaptability

Organizational Success
Productivity of I & G

Individual Factors
(learning, ability, personality,
values, motivation, stress)

Satisfaction of I & G

Interpersonal Factors
(leadership, communication, decision-making skill,
intra & intergroup dynamics, communication)

Foundations
Insights from several disciplines inform our understanding of OB:
psychology, social psychology, sociology, economics, cultural
anthropology
A strategic approach differs from the disciplines above in 2 ways:
(1) It INTEGRATES knowledge from all of these areas to
understand behaviour in organisations
(2) It focuses on BEHAVIORS and PROCESSSES that help to create
competitive advantages and financial success

What is an Organization?
Collection of INDIVIDUALS, whose members may CHANGE
over time, forming a COORDINATED SYSTEM of specialised
activities for the purpose of achieving specific GOALS over an
extended period of time
e.g. Intel, Microsoft, Procter & Gamble, Government
Organizations

Features of an Organization
(1) NETWORK of INDIVIDUALS
(2) SYSTEM
(3) Coordinated ACTIVITIES
(4) Division of LABOR
(5) GOAL Orientation
(6) CONTINUITY over time, regardless of changes in individual
membership

Resources of an Organization

An organisations resources consists of TANGIBLE and INTANG

RESOURCES
Tangible = property, factories, equipment, inventory

Intangible = reputation of the organization, trust between m

and associates, organisational culture, human capital

Focus on Human Capital

Sum of the skills, knowledge and general attributes of people in an organisation
Encompasses not only easily observed skills associated with operating machinery but
also skills, knowledge and capabilities of managers and associates for learning,
communicating, motivating, building trust and working on teams
Human capital DOES NOT DEPRECIATE in value as it is used, rather, it is ENHANCED
through use
It is a source of COMPETITIVE ADVANTAGE

Competitive Advantage
Results when an organisation can perform some aspect of work BETTER than its competitors can or when it can
perform the work in a way that competitors CANNOT DUPLICATE
For human capital to be the basis for sustainable competitive advantage, it must satisfy the following conditions:
(1) Value - extent to which individuals are capable of producing work that SUPPORTS an organizations STRATEGY
for competing in the marketplace
(2) Rareness - extent to which SKILLS & TALENTS of the organisations people are UNIQUE in the industry
(3)Imitability - extent to which the skills and talents of an organisations people can be copied by other
organizations

Positive OB
An approach to managing people that nurtures EACH
INDIVIDUALS GREATEST STRENGTHS and helps people use
them to their and the organisations advantage

High-Involvement Management
Involves CAREFULLY SELECTING & TRAINING associates
Key Characteristics:
(1) Selective Hiring e.g. through rigorous evaluations, multiple interviews
(2) Extensive Training e.g. training programs
(3) Decision Power - providing associates with authority to make some important decisions while inviting them to
influence other decisions
(4) Information Sharing - in order for associates to make effective decisions and provide useful inputs to decisions
(5) Incentive compensation e.g. profit sharing, individual incentive systems, knowledge or skill-based pay,
individual piece-rate systems

Activities
INDIVIDUAL EXERCISE: Career Style Inventory (page 35)