1|Page

Term Paper
On

“How does the physical environment affect organizational

behavior?”

Course: Organizational Behavior

Submitted to: Lecturer Farhana Aziz
Department of Business Administration in Management Studies.
Submitted by:
Tahseef Reza (Id- 16251080)
Sufia Anwar Samantha (Id- 16251028)
Mahbub Alam Hridoy(Id- 16251084)
Section: B
Department of Business Administration in Marketing
Bangladesh University of Professionals
Date of Submission: 14 November, 2017
2|Page

Letter of Transmittal
Date: 14 November, 2016.

The Lecturer,

Organizational Behaviour,

Dept. of Business Administration in Management Studies.

Bangladesh University of Professionals.

Subject: Prayer for accepting our term paper.

Madam,

With due respect, we, obedient students of your “Organizational Behavior” course, have
completed my term paper on the topic selected by us.

In our term paper, we have discussed elaborately about the definition of organizational behavior,
its types, range, definition of physical environment and its different factors. Besides, we have
also made an attempt to find linkage between different physical environmental factors and
organizational behavior and how these findings can be utilized for better understanding of
organizational behavior in the future.

This term paper has been prepared with great efforts and dedication, in compliance with course
requirement and your instructions. We hope that this task on our part will be appreciated.

Lastly, we will be grateful if you point out my mistakes and kindly suggest us as to how we can
overcome these faults in the upcoming projects.

Yours sincerely,
Tahseef Reza
(On behalf of the group)
3|Page

Executive Summary
Research has consistently demonstrated that characteristics of the office environment
can have a significant effect on behavior, perceptions, and productivity of workers. Dole
and Schroeder (2001), stated that in the workplace, it is often assumed that employees
who are more satisfied with the physical environment are more likely to produce better
work outcomes. User satisfaction is recognized as an important factor in the success of
an organization and is regarded as a key indicator of performance. This is based on the
rationale that higher levels of satisfaction improve morale and reduce voluntary
turnover. Other researchers found that employee‘s satisfaction with their work
environment is directly related to their job satisfaction and indirectly related to
organizational commitment and turnover intention. In general, studies of the ambient
features in office environments—including noise, lighting, temperature, existence of
windows and others; suggest that such elements of the physical environment influence
employees‘ attitudes, behavior, satisfaction and performance. In his 1995 paper,
Andrian Laeman stated that "people who are unhappy with temperature, water quality,
lighting and noise conditions in their offices are more likely to say that this affects their
concentration at work". Although some researchers have found significant effects of
physical environment features on job satisfaction, behavior, performance and indirectly
affect work concentration and productivity, other studies have failed to confirm a direct
relationship between these variables. Therefore, this term paper presents the literature
reviews on a study of the influence of physical office environments towards employees
behavior in an organization. Several factors of environments such as the effects of
workplace design, office layout, indoor temperature, lighting and air, colour, noise and
also interior plants towards employees‘ well-being and performance are discussed.
4|Page

Acknowledgement
I would like to take this opportunity to express my gratitude to our honorable faculty
Mrs. Sanjana Hossain for making ―Organizational Behavior‖ easy to understand. The
way she used to prepare and present lessons to us with practical examples was truly
unique and also effective at the same time. During the preparation of making this term
paper, Madam has extended her helping hand whenever I sought for any kind of help
regarding any lessons related to this course. Apart from that, I have extracted
information from the book ―Organizational Behavior‖-15th edition, written by Stephen.
P. Robbins, Timothy A. Judge and Neharika Vohra. Besides, I have used information
from different websites for adaptation in my own words. The links of those websites are
given at the end of the main body of term paper. Apart from that, I have also put
forward my insight by understanding interpretations from different interviews that are
displayed on internet. Furthermore, my elder brother and his friends majoring in
Management Studies have constantly helped me throughout this course so that I have a
command over the topics that has been taught to us.
5|Page

Abstract/Introduction
Organizational behavior is a major discussion area under Management Studies. It‘s
because managing employees in an organization is largely dependent on tracing the
behavioral pattern of different employees and how management can ensure a proper
physical environment in order to keep the enthusiasm of the employees in the work
place. Only then, employees‘ behavior would be aligned to the expectations of an
organization. Office employees spend a lot of their time inside a building, where the
physical environments influence their well-being and directly influence their work
performance and productivity, which are major determinants of organizational
behavior. In the workplace, it is often assumed that employees who are more satisfied
with the physical environment are more likely to produce better work outcomes.
Temperature, air quality, lighting and noise conditions in the office affect the work
concentration and productivity. Numerous studies have consistently demonstrated that
characteristics of the physical office environment can have a significant effect on
behavior, perceptions and productivity of employees. Most of the previous researchers
in their studies are more focused on a single factor that could give an effect on
employee‗s performance at work. However, no study was done to examine the
relationships between the whole factors of physical office environment and employees
‗performance. Therefore this term paper of mine presents a literature review of several
environmental factors which directly or indirectly affect employees work performance.
Several factors of environments such as the effects of workplace design, indoor
temperature, colour, noise and also interior plants towards employees‘ well-being and
performance have been discussed.
6|Page

Chapter 1: Physical Environment

A business exists, just like you and I, in a world that is filled with countless things that
form its physical environment. On Earth, many different types of physical
environments, natural and synthetic, have existed throughout its history. Furthermore,
as scientific knowledge of the universe increases, scientists begin to search for true
physical environments on other worlds. The physical environment includes
components of the tangible workplace environment that comprise
employee’s working conditions such as clean indoor air, safe drinking
water, ergonomic workstation designs, violence and aggression-free work
environment, available technologies, disability management practices,
workplace policies and procedures, design and construction of the
workplace. As a whole, the physical environment is an important determinant of
health influencing the prospects of health in many ways An important thing to
remember is that both the natural and man-made variables are part of the physical
environment. Any successful business must consider both in its planning
processes.

1.1 Natural physical environments

A total of 190,000 years before present, the first modern human was born. When
compared to prehistoric environments, the Earth has not changed drastically in the past
190,000 years. Today, anything that supports life, such as the atmosphere,
the oceans and climate zones such as deserts, tundra and tropical
rainforests, which exist worldwide, is considered a physical environment.

1.2 Human-made physical environment variables

As humans have progressed through history, manmade environments have been
created. Anything from palaces made for ancient rulers to modern cities are considered
man-made physical environments because they sustain human life. Today, a complex
man-made physical environment exists. Humans live in, interact in, and are
influenced by a highly technological and developed society. Homes,
businesses, and streets make up the man-made physical environments of the world.
7|Page

Chapter 2: Organizational Behavior

Organizational behavior is a field of study that investigates the impact that
individuals can have on behavior within organizations, for the purpose of
applying such knowledge toward improving an organization’s effectiveness.
Simply speaking, Organizational behavior studies the impact individuals, groups, and
structures have on human behavior within organizations. It is
an interdisciplinary field that includes sociology, psychology, social
psychology, and anthropology
Organizational behavior complements organizational theory, which focuses on
organizational and intra-organizational topics, and complements human-resource
studies, which is more focused on everyday business practices. To elaborate,
organizational behavior is a field of study, meaning that it is a distinct area of expertise
with a common body of knowledge. Basically it studies three determinants of
behavior in organization, which includes:
 Individuals
 Groups
 Structure
Apart from that. Organizational Behaviour applies the knowledge gained about
individuals, groups and the effect of structure on behavior in order to make
organizations work more effectively. Combining the aforesaid interpretations,
Organizational Behaviour can be put in such a way, ―It‘s the study of what people do in
an organization and how their behavior affects the organization‘s performance as a
whole. Since Organizational Behaviour is concerned specifically with
employment-related situations, it is not surprising that it emphasizes
behavior as related to concerns such as jobs, work, absenteeism,
employment turnover, productivity, human performance and management.

2.1 Different types of organizational behavior

Organizational studies encompass the study of organizations from multiple
perspectives, methods, and levels of analysis. "Micro" organizational behavior
refers to individual and group dynamics in organizations.
8|Page

"Macro" strategic management and organizational theory studies whole

organizations and industries, especially how they adapt, and the strategies,
structures, and contingencies that guide them. Some scholars also include the
categories of "meso"-scale structures, involving power, culture, and
the networks of individuals in organizations, and "field"-level analysis, which
studies how entire populations of organizations interact.
Many factors come into play whenever people interact in organizations. Modern
organizational studies attempt to understand and model these factors. Organizational
behavior can play a major role in organizational development, enhancing overall
organizational performance, as well as also enhancing individual and group
performance, satisfaction, and commitment.

2.2 Range of Organizational Behaviour

Organizational behavior is particularly relevant in the field of management due to
the fact that it encompasses many of the issues managers face on a daily basis. Although
debate exists about the relative importance of each, concepts such as motivation,
leader behavior, and power, interpersonal communication, group structure
and processes, learning, attitude development, and perception, change
processes, conflict, work design and work stress are all facets of
organizational behavior and responsibilities of management.
Organizational behavior also deals heavily in culture. Company or corporate culture
is difficult to define but is extremely relevant to how organizations behave. A Wall Street
stock-trading company, for example, will have a dramatically different work culture
than an academic department at a university. Understanding and defining these
work cultures and the behavioral implications they embed organizationally
is also a central topic in organizational behavior.
9|Page

Chapter 3: Physical Design

It has been proved time and again that an open workplace environment that has
few walls, partitions and features workstations for allow employees to see
and interact with one another can create a cohesive feeling, understanding
and facilitate communication to great extent. There is a drawback in maintaining
so called privacy for all employees. Cubicles and offices, while providing more privacy,
in some cases, enhanced productivity, may leave colleagues feeling physically
disconnected from one another. Workplace should be designed in such a way that
collaboration is encouraged without harming individual‘s need for space and privacy.
Progressive work environments often incorporate open workspaces with minimal
physical barriers that both balance freedom from distraction and encourage interaction
among staffers.

3.1 Isolation
People have affiliation needs. He wants an environment where he can interact with
people surrounding him to get rid of boredom, loneliness and thereby sustaining
energetic vibe. Employees who continually work behind closed doors may develop a
feeling of isolation. This can happen in office environments where confidentiality and
privacy are vital to conducting business, such as banking, counseling or health-care
records. While workers may have more focus in this type of setting, limited interaction
also can affect the emotions and mood of the people who work there. Such isolated
environment often acts a barrier to achieve desired organizational behavior.

3.2 Office Layout

There are offices which are designed in a way to give a proper platform for
co-operation among the employees. Offices that have centrally located
shared machinery and group together department members in close
proximity to one another increase productivity because interaction is easy.
Employees who are spread out through an office and have to make lengthy trips to get to
resources or to talk to department colleagues can decrease productivity and lead to
frustration. Therefore, this aspect is a major concern to be dealt with.
10 | P a g e

3.3 Colour
Colour is a visual phenomenon triggered by the response to the stimulation
of light. It pervades every aspect of our lives, embellishes the ordinary and gives beauty
and drama to everyday objects .Colours in the office workplaces are very
important to ensure efficiency in the working environment. Each colour has
different effects on the human body. Everyone experiences colour in their own personal
way. Peoples are reactions to different colour schemes depend on their
culture, education, genetics and socio-economic level. As a result, behavior and
productivity in the workplace are heavily influenced by space, structure, colour, lighting
and activity. Garris and Monroe (2005) state that colour influences not only mood but
also wellness and productivity. As mentioned by Syahrul Nizam & Emma Marinie
(2010), colours also affect psychological aspects of the building‗s occupants. Some
colours provide calmness, some provide comfort, some are stimulating and
many others have an impact in different ways. This means that colour will affect
the mood of the occupant of the space. So, appropriate colour should be chosen to
ensure the mood of the employees is good in order to encourage productivity.
Productivity is rarely correlated with colour. However, the colour scheme does play an
important role in the working environment. According to Farshchi and Fisher (1997),
the character of space affects human emotions and behaviour. In space configuration or
arrangement, colour also plays an important role in influencing either large or small
areas. For instance, a long, narrow room can be made to seem more normal if the end
walls are painted in warm, deep and intense colours, while the side walls are painted in
lighter, less saturated colours. A low ceiling will seem less oppressive if its colour is light
while a high ceiling can be made to seem lower by a dark blue, grey or black.
Comparison of the same size of two room‗s results that room with the darker colour
scheme will appear to be smaller than the other room with a lighter colour scheme.
Jobs that require great concentration require a neutral colour scheme, jobs like those of
accountants and attorneys require a stronger a colour scheme, while journalists would
perform best in exciting and energetic colours with great contrast value. Meanwhile,
O‗Brien (2007), suggest that a blue office is ideal for someone who must focus
and concentrate on numbers, green is a great choice for a management
11 | P a g e

office as it has a balancing effect, and yellow is suitable for sales offices.
Therefore, the colour scheme chosen for a workplace or an office must be made with
proper consideration to produce better quality of work. If unsuitable colours were
chosen, employees might be subject to negative psychological impacts such as stress,
depression, dullness or boredom. As a conclusion, it is clear that colour assists in
creating attention. This is crucial for workers especially in work performance. Without
concentration and attention, the work done will be low in quality and productivity.
Therefore, consideration of colour to improve productivity should be made with proper
guidance.

3.4 Distractions
Organizations must ensure minimal space for every employee where he can live his own
world without any interference. Such privacy boost up focus and attention among the
employees leading in productivity. On the contrary, asking employees to work in an ―on
display‖ environment can lead to a lack of privacy. For example, business offices that are
open to a retail environment or feature glass partitions can give the people who use
them the feeling of being in a fish bowl. Employees may find it hard to focus and tune
out visual and audio distractions. Likewise, work stations that have walk-through traffic
can also pose problems, as staffers must deal with continual interruptions.

3.5 Noise
Sound or noise problem in an office is something that could not be avoided. Studies
have shown that when sound is turned off, errors in work are reduced and
productivity increases. Sundstrom, Town, Rice, Osborn, and Brill (1994) identified
noise as an ambient stressor relating to job satisfaction in the work environment.
According to Loewen and Suedfeld in their 1992 paper, mentioned that noise not only
containing speech, but sound produced by phone, copier, and keyboard. The disruption
in performance cannot be attributed to the presence of speech alone . Smith (1989)
reviewed the effects of noise on performance. Despite an extensive review, Smith
concluded that noise effects are still unclear, and that beyond intensity issues,
researchers need to analyze the questions of what type of noise at what intensity affects
12 | P a g e

which type of task performance. Other studies have found that open office noise can
be stressful and demotivating. As jobs become more technologically complex, the
frequency of stress-related disorders in work environments increases. Office workers, in
particular, consistently report ‗‗the ability to concentrate without noise and other
distractions‖ to be one of the most important aspects of the work environment.
According to Denyer J.C (1969) there are several steps that can be implemented by
management to reduce noise levels in an office such as:

 Install a sound absorbent material on the ceiling, walls and floors of the office.
Sound absorbent screens' can also be installed for office space that uses
landscape concept. In addition, the use of thick curtains on the windows can also
reduce unwanted noise.

 Install 'felt pads' on typewriters and other machines that produce sound to
reduce noise.

 Changing the ringing phone to the 'buzzers' system, 'light indicators' or 'bleeps'
to reduce noise.

 If necessary, a small room in an office can be provided for the purpose of

discussion or an appointment of personnel to avoid interference from outside.

 Noise impacts can be reduced by installing a floor covering such as carpet and so
on.

 The facility manager or management must ensure that employees who interact
with a tone so as not to disturb the focus of the work of others. Although this is
somewhat trivial, but it is practical to reduce noise in the office.
13 | P a g e

3.6 Indoor temperature

Numerous studies have shown that indoor climate impacts both health and
performance, which in turn affect productivity. Discomfort factors can decrease
employees‘ focus on their works. However, employees can focus more when high
temperature is reduced by the use of air conditioning equipment. Several
studies conducted by Lorsch and Abdou (1994), "shows that when the air-conditioning
system was introduced, employees feel that their work space becomes more comfortable
and the productivity tends to increase by 5-15 percent because they can concentrate on
their work. This statement explains that when an employee feels comfortable with the
workplace environment, things that can distract their work can be reduced and they can
perform better. Hence, from the literature review by other researchers indicate that
productivity decreases by 2% per each degree over 25o C and presented the
link between a decrement in productivity and high indoor N. Kamarulzaman et
al. / Procedia Engineering 20 (2011) 262 – 268 265 N. Kamarulzaman, A. A. Saleh, S. Z.
Hashim, H. Hashim, A. A. Abdul-Ghani/ Procedia Engineering 00 (2011) 000–000
temperature. Heat can cause lethargy which not only increases the rate of accidents but
can also seriously affect productivity. Therefore as a conclusion it is indirectly explained
that the office environment would influence the actions of an employee. Cramped,
disorganized, dirty and dusty work space could also give pressure to
employees and this could affect their work.

3.7 Light and Air

Research has revealed that offices that use natural lighting and facilitate fresh air flow
often have more productive employees than office environments that don‘t. Employees
who can look out or open windows feel less claustrophobic than those who are situated
in windowless environments with heavy fluorescent lighting. Seeing the sky and feeling
a breeze now and then can reduce stress and anxiety. Eventually, it impacts on their
performance in a positive way.
14 | P a g e

3.8 Interior plant

Interior plants are common in many homes, work places, and commercial settings.
According to Sundstrom, E. (1986), in the 1960s, the open-plan 'office landscape,'
characterized by the abundant use of large potted plants to separate work spaces, was
popular. Sethi, A. Set. all, (1987) agreed that although the office environment has
changed over time, interior plants continue to be used in work spaces. Relf. D. (1990)
reports that interaction with plants, both passive and active can change
human attitudes, behaviors, and physiological responses. The stress-
reducing benefits of passively viewing plants in natural settings are well
documented. Therefore as mentioned by Relf D (1990), the need for a thorough
understanding of the relationship between plants and human well-being is increasingly
important. A few studies done by researchers indicates that office workers are
reported to be less tired when they have access to plants or window views,
and prefer work environments with living plants and window views .
Furthermore, he also reported that natural environments can have a restorative
effect on attention.
15 | P a g e

Conclusion
The Influence of different physical variables on organizational behavior has been
phenomenon over the years since the industrial revolution. While one might think an
office is just an office, a workspace has its own personality, just like a home. An open
and inviting environment that is well-designed can positively influence the way one feels
and behave in the workplace, while a cold, sterile, closed environment can bring
him/her down on a regular basis. Likewise, the way an office is designed can improve or
impede communication among him and his counterparts, and that has a direct impact
on productivity.

References
1. Source: Boundless. ―What is Organizational Behavior?‖ Boundless Management.
Boundless, 31 May. 2016. Retrieved
from https://www.boundless.com/management/textbooks/boundless-
management-textbook/organizational-theory-3/why-study-organizational-
theory-28/what-is-organizational-behavior-162-3925/
2. http://www.sciencedirect.com/science/article/pii/S1877705811029730
3. http://woman.thenest.com/physical-environment-workplace-affects-work-14967.html