Unit 2 Organizational Behavior

Unit 2 Organizational Behavior Smita Choudhary Faculty HR/OB

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Organizational Behavior

Contents Introduction Definitions of OB Historical evolution

of OB as a discipline Contributing disciplines to the OB field

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Organizational Behavior

Introduction  Organizations need to develop their interpersonal

or people skills for being effective.  Organizational behavior is a field of study that investigates the impact that individuals, groups, and structure have on behavior within an organization, then applies that knowledge to make organizations work more effectively. Robbins (2003)  OB concentrates on how to  Improve productivity  Reduce absenteeism and turnover  Increase employee citizenship  Increase employee job satisfaction

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Organizational Behavior

 The field of organizational behavior takes extracts

from the behavioral science disciplines like psychology, social psychology, and cultural anthropology.  Some basic ideas included in OB are personality theory, attitudes and values, motivation and learning, interpersonal behavior, group dynamics, leadership and teamwork, organizational structure and design, decision-making, power, conflict and negotiation.

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Learning Objectives After this unit, you will be able to understand----Historical evolution of OB as a discipline Contributing disciplines to the OB field

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Definitions of OB  Organizations

are defined as social arrangements, constructed by people, who can also change them. ----Buchanan and Huczynski (1997)  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

OB is about---1. “the study of human behavior, attitudes and performance within an

organizational setting; 2. drawing on theory, methods and principles from such disciplines--3. as psychology, sociology, and cultural anthropology to learn about individual perception, values, learning capabilities, and actions 4. while working with groups and within the total organization; 5. analyzing the external environment’s effect on the organization 6. and its human resources, missions, objectives and strategies.”

 Organizational behavior is defines as “The understanding, prediction and

management of human behavior in organizations.” Fred Luthans

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Contd.  From the above definitions, OB can be seen

as---A way of thinking An interdisciplinary field Having a distinctly humanistic outlook Performance oriented Seeing the external environment as critical Using scientific method Having an application orientation

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Organizational Behavior

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

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Historical Evolution of OB as a Discipline  Many people have contributed to the growth of

OB. Some important contributions are-

A) Early Theorists  1. Adam Smith’s contribution  In the Wealth of Nations published in 1776,

Adam Smith stated that organizations and society would benefit if they practice division of labor.  Division of labor increased productivity by improving workers’ skills and expertise and by saving time. 10

Organizational Behavior

2. Work of Charles Babbage  He added some more advantages to the list of

advantages of division of labor proposed by Adam Smith:  It decreases the time needed to learn a job.  It reduces wastage of material during the learning process.  Improves skill levels.  It matches people’s skills and physical abilities with specific tasks. 11

Organizational Behavior

B) The Classical Era Classical era covers the period from

1900 to mid 1930s. The main contributors during this period were Frederick Taylor Henri Fayol Max Weber Mary Parker Follet Chester Barnard 12

Organizational Behavior

1.Frederick Taylor  His main focus was on finding one best way of doing a job.  He gave importance on selecting the right people for the right job

and train them to do the job in one best way.  His scientific principles of management highlighted the following principles  Shift all responsibility for the organizational work from worker to manager.  Use scientific methods to find the most efficient way of doing work.  Select the best person to do the job.  Train the worker to do the work effectively.  Observe the performance of workers to make sure that proper work methods

are used and correct results are obtained.

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2.Henri Fayol  He was a mining engineer and a manager by profession.  He defined the nature and working patterns of twentieth century

organizations in his book, General and Industrial Management, published in 1916.  In this book 14 principles of management are defined. They are---1. Division of work – Tasks should be divided among employees. 2. Authority and responsibility – Authority is the right to give orders. It should match with responsibility. 3. Discipline – It is necessary for proper functioning of business. 4. Unity of command – An employee should receive orders from one superior only. 5. Unity of direction – Activities related to a single objective should be coordinated by a single plan.

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Subordinates of individual interest to general interest – Individual or group goals must not take priority over business goals. 7. Remuneration of personnel – It should be fair, encourage effort and there should be no overpayment. 8. Centralization – The extent of centralization of power of issuing orders at the top depends on size of the organization and the skills of its personnel. 9. Scalar chain (line of authority) – Flow of communication should be up and down the line of authority. 10. Order – Material and personnel should be at proper place. 11. Equity – People should be treated with kindness and justice. 12. Stability of tenure of personnel – Quick turnover of people should be avoided because it takes time to develop expertise. 13. Initiative – Employees should be encouraged to take initiatives. 14. Esprit de corps – All efforts should be made to maintain peace and harmony within the organization. 6.

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3.Max Weber  His

theory is also known as bureaucratic theory in management.  He described an ideal kind of organization and called it bureaucracy. The features of Weber’s bureaucratic structure are------ Areas of authority should be clearly specified.  Organizations follow principle of hierarchy where subordinates follow instructions of superiors but have a right to appeal.  Abstract rules guide decisions and actions.  Officials are selected on the basis of technical qualifications.  Employment by the organization is a career.

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C) The Human Relations Movement 1. Mary Parker Follet----- The view that people are important to the world of business was given by Mary Parker Follet. With this the concept of human relations movement started.  Follet believed that organizations should be based on collectivism (group ethics) rather than individualism.  The manager’s task was to coordinate group efforts.  Managers and workers should be like partners.

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2. Chester Barnard  Barnard believed that organizations consist of

people who have interacting social relationships.  He believed that organizations can be successful if they cooperate with various stakeholders such as employees, customers, investors, suppliers, etc.  He emphasized on the need for development of skills and motivation of employees for the success of organization.

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3. Elton Mayo  He is known as the founder of human relations movement.  He is also known for his research including the Hawthorne

Studies and his book ‘The Social Problems of an Industrialized Civilization (1933)’.  The research conducted under the Hawthorne Studies showed the importance of groups in affecting the behavior of individuals at work.  He found that work satisfaction depended on the social relationship of the workgroup.  Physical conditions and financial incentives have very low motivational value.  He concluded that performance depends on both social issues and job content. 19

Organizational Behavior

4. Dale Carnegie  His book How to Win Friends and Influence

People is used by management experts even today.  He believed that to succeed, an organization should win the cooperation of its people.  He advised----- Make

others feel important by appreciating their efforts.  Try to make a good impression.  Win people by being sympathetic and never telling that they are wrong.  Change people by praising their good qualities. 20

Organizational Behavior

5. Abraham Maslow  He proposed the need hierarchy theory (physiological,

safety, social, esteem and self actualization needs).  Each step in the hierarchy must be satisfied before moving on to the next step.  After a need is satisfied, it does not motivate an individual.  The final goal of human existence is self actualization.  Managers who accepted this theory tried to change organization and management practices to reduce hurdles that prevent employees from reaching self actualization. 21

Organizational Behavior

Maslow’s Hierarchy of Needs

Self

Esteem

Social

Safety

Physiological

Be where you want to be

Need for respect from others

Need to be in a group, be loved

Need for stability and consistency

Basic needs like food, water

6. Douglas McGregor  He gave two statements about human nature – Theory X and

Theory Y.  Theory X put forward a negative view of people stating that this category has  Little ambition  Dislike work  Want to avoid responsibility  Need close supervision at work

 Theory Y put forward a positive view of people stating that

this category has

 Self direction  Take responsibility  Consider work as a natural activity

 McGregor believed that managers should give freedom to

their subordinates to utilize their creativity and potential.

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D) Behavioral Science Theorists 1. B.F. Skinner His research on classical and operant conditioning and behavior modification affected the design of organization’s training programs and reward systems.  According to Skinner, behavior depends on results.  He stated that people show a desired behavior only if they are rewarded for it.  A behavior is not repeated if an individual is not rewarded or punished for it. 24

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2.David McClelland  His work has helped organizations to match

people with jobs and in redesigning jobs for high achievers to motivate them.  For

example, people who have received achievement training in India, work for longer hours, initiate more new business ventures, make greater investments in productive assets as compared to people who did not receive such training.

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3.Fred Fiedler  His work in the field of leadership has a big

contribution to the growth of OB as a discipline.  He

highlighted the situational aspects of leadership and tried to develop a complete theory of leadership behavior.

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4.Frederick Herzberg  He tried to find answer to the

question: What individuals want from their jobs?  By his study, he reached a conclusion that people preferred jobs that provided recognition, achievement, responsibility and growth.  Only hygiene factors were not sufficient to motivate people at workplace.  This work is important in OB because it helped in enriching jobs and the quality of work life in modern organizations.

Hygiene Factors

•Company policies

• Achievement

• Quality of supervision

• Career advancement

• Relations with others

• Personal growth

• Personal life

• Job interest

• Rate of pay

• Recognition

• Job security

• Responsibility

• Working conditions

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Motivational Factors

E) OB in Present Times Only a single theory cannot improve

organizational functioning and effectiveness. Therefore a contingency approach is suggested. Today, the focus is on understanding the situational factors and how they affect a behavior pattern of individuals.

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Organizational Behavior

Contributing Disciplines to the OB Field Organizational behavior is a behavioral science that takes contributions from various behavioral disciplines like---Psychology Sociology Social psychology Anthropology Political science

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Psychology  It is the science that tries to measure, explain and change the behavior of humans and other animals.  Early industrial or organizational psychologists were concerned with problems of tiredness, boredom and other factors that affect performance.  But now, they are concerned with learning, perception, personality, training, leadership effectiveness, etc. Sociology  It is the study of the social system in which the individual lives.  It studies people with respect to their colleagues.  Sociologists make an important contribution to OB through their study of group behavior in organizations.

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Social Psychology  It mixes the concepts of psychology and sociology.  It focuses on influence of people on one another. Anthropology  It is the study of societies to learn about human beings and their activities.  Anthropologists work on culture and environments.  They help in understanding differences in fundamental values, attitudes and behavior of people in different countries and different organizations. Political Science  It studies behavior of individuals and groups within a political environment.  It focuses on areas like conflict, intra-organizational politics and power. 31

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