Organizational Behavior

What is an Organization?
A structured social system consisting of groups and individuals working together to meet some agreed-upon objectives.

Definition of OB

Organizations are a system of cooperative activities - and their coordination requires something intangible and personal that is largely a matter of personal relationships. ---- Barnard (1938) OB is concerned with the study of the structure, functioning and performance of organizations, and the behavior of groups and individuals within
them.

---- Pugh (1971)

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Organizational Behavior
The field that seeks increased knowledge of all aspects of behavior in organizational settings through the use of the scientific method. Characteristics of the field:
OB applies the scientific method to practical managerial problems. OB focuses on three levels of analysis. OB is multidisciplinary in nature. OB seeks to improve organizational effectiveness and the quality of life at work.
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Scope of OB
Field of study and not a discipline Interdisciplinary approach An applied science oriented towards human behaviour Contingency orientation Levels of performance Behavioural approach

Practical Managerial Problems

How can goals be set to enhance peoples job performance? How may jobs be designed so as to enhance employees feelings of satisfaction? Under what conditions do individuals make better decisions than groups? What can be done to improve the quality of organizational communication? What steps can be taken to alleviate work-related stress? How can leaders enhance the effectiveness of their teams?
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Levels of Analysis

Wood (1997) suggested that different levels of analysis can be applied when judging the importance of an organizational issue. He proposed eight levels-- Individual Team Inter-group Organizational Inter-organizational Societal International Global

Basic Models of OB

Autocratic - The basis of this model is power with a managerial orientation of authority. The employees in turn are oriented towards obedience and dependence on the boss. The employee need that is met is subsistence. The performance result is minimal.
Custodial - The basis of this model is economic resources with a managerial orientation of money. The employees in turn are oriented towards security and benefits and dependence on the organization. The employee need that is met is security. The performance result is passive cooperation

Basic Models of OB

Supportive - The basis of this model is leadership with a managerial orientation of support. The employees in turn are oriented towards job performance and participation. The employee need that is met is status and recognition. The performance result is awakened drives.
Collegial - The basis of this model is partnership with a managerial orientation of teamwork. The employees in turn are oriented towards responsible behavior and selfdiscipline. The employee need that is met is selfactualization. The performance result is moderate enthusiasm.

Basic OB Model

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Multidisciplinary Roots

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Towards an OB Discipline

OB Matters

Satisfied Employees
More Pleasant at Work Lower Costs Higher Productivity Less Likely to Quit

Unsatisfied Employees
Reject Organization Policies More Likely to Steal Increased Mental and Physical Illnesses
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Why is OB Important?
Companies whose managers accurately appraise the work of their subordinates enjoy lower costs and higher productivity. People who are satisfied with the way they are treated on their jobs are more pleasant to work with and less likely to quit. People who are trained to work together tend to be happier and more productive. Employees who believe they have been treated unfairly are more likely to steal and reject the policies of their organizations. People who are mistreated by their supervisors have more mental and physical illnesses than those who are treated with kindness, dignity, and respect. Organizations that offer good employee benefits and have friendly conditions are more profitable than those that are less people oriented.
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Fundamental Assumptions
OB recognizes the dynamic nature of organizations.
Open Systems: Self-sustaining systems that transform input from the external environment into output, which the system then returns to the environment.

OB assumes there is no one best approach

Contingency Approach: A perspective suggesting that organizational behavior is affected by a large number of interacting factors. How someone will behave is said to be contingent upon many different variables at once.
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The Open Systems Model

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The History of OB

The Early Days: Scientific Management and the Hawthorne Studies Classical Organizational Theory Late Twentieth Century: Organizational Behavior as a Social Science OB Today: The Infotech Age
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The Early Days

Scientific Management: An early approach to management and organizational behavior emphasizing the importance of designing jobs as efficiently as possible. Human Relations Movement: A perspective on organizational behavior that rejects the primarily economic orientation of scientific management and recognizes, instead, the importance of social processes and work settings.
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Classical Organizational Theory

An early approach to the study of management that focused on the most efficient way of structuring organizations. Division of Labor: The practice of dividing work into specialized tasks that enable people to specialize in what they do best. Bureaucracy: An organizational design developed by Max Weber that attempts to make organizations operate efficiently by having a clear hierarchy of authority in which people are required to perform well-defined jobs.
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Challenges and Opportunities in OB

The rise of global businesses with culturally diverse workforces. Rapid advances in technology. The rising expectations of people in general.
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Globalization

The process of interconnecting the worlds people with respect to the cultural, economic, political, technological, and environmental aspects of their lives. Multinational Enterprises: Organizations that have significant operations spread throughout various nations but are headquartered in a single country.
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Working Abroad

Expatriates: People who are citizens of one country but who are living and working in another country. Culture: The set of values, customs, and beliefs that people have in common with other members of a social unit (e.g., a nation). Culture shock: The tendency for people to become confused and disoriented as they attempt to adjust to a new culture. Repatriation: The process of readjusting to ones own culture after spending time away from it.
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Working Abroad

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Management Perspectives

Convergence Hypothesis: A biased approach to the study of management, which assumes that principles of good management are universal, and that ones that work well in the United States will apply equally well in other nations. Divergence Hypothesis: The approach to the study of management that recognizes that knowing how to manage most effectively requires clear understanding of the culture in which people work.
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Shifting Demographics

More women are in the workforce than ever before. Racial and ethnic diversity is reality. People are living and working longer than ever before.
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Responding to Changes in Technology

Creating Leaner Organizations
Downsizing/Rightsizing: The process of adjusting the number of employees needed to work in newly designed organizations. Outsourcing: The process of eliminating those parts of organizations that focus on noncore sectors of the business and hiring outside firms to perform these functions instead.

Creating Virtual Organizations

Highly flexible, temporary organizations formed by a group of companies that join forces to exploit a specific opportunity.

Increasing the Use of Telecommuting

The practice of using communications technology so as to enable work to be performed from remote locations.
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Responding to Changes in Expectations

Increasing Flexibility in Response to Employees Needs The Quality Revolution Corporate Social Responsibility
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Increasing Flexibility
Flextime Programs: Policies that give employees some discretion over when they can arrive and leave work, thereby making it easier to adapt their work schedules to the demands of their personal lives. The Contingent Workforce: People hired by organizations temporarily to work as needed for finite periods of time. Compressed Workweeks: The practice of working fewer days each week but longer hours each day. Job Sharing: A form of regular part-time work in which pairs of employees assume the duties of a single job, splitting its responsibilities, salary, and benefits in proportion to the time worked. Voluntary Reduced Work Time Programs: Programs that allow employees to reduce the amount of time they work by a certain amount, with a proportional reduction in pay.
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The Quality Revolution

Total Quality Management: An organizational strategy of commitment to improving customer satisfaction by developing techniques to carefully manage output quality. Benchmarking: The process of comparing ones own products or services with the best from others. Malcolm Baldridge Quality Award: An award given annually to American companies that practice effective quality management and make significant improvements in the quality of their goods and services.
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Corporate Social Responsibility

Business decision making linked to ethical values, compliance with legal requirements, and respect for individuals, the community at large, and the environment. It involves operating a business in a manner that meets or exceeds the ethical, legal, and public expectations that society has of business
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Ethics in Organizations
Good ethics is good business
Improved financial performance Reduced operating costs Enhanced corporate reputation Increased ability to attract and retain employees

Code of Ethics: A document describing what an organization stands for and the general rules of conduct it expects of its employees. Ethics Officers: Individuals (usually at the vice presidential level) who oversee the ethics of a companys operations. Ethics Audit: The process of actively investigating and documenting incidents of dubious ethical value within a company.
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Ethical Guidelines
1.

2. 3. 4. 5. 6.

Does the behavior violate the obvious shall nots? Will anyone get hurt? What if you did it 100 times? How would you feel if someone did it to you? Whats your gut feeling? Would the behavior pass the front page test?
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