CHAPTER 1

TO
ORGANIZATIONAL
BEHAVIOR
 LEARNING OBJECTIVES

 Define organizational behavior.

 Trace the historical roots of
organizational behavior.
 Discuss emergence of
contemporary organizational
behavior, including its precursors,
the Hawthorne studies, and the
human relations movement.
 Describe contemporary
organizational behavior – its
characteristics, concepts, and
importance.
 Identify and discuss contextual
perspectives on organizational
behavior
 MEANING of
ORGANIZATIONAL BEHAVIOR

What is an organization?
A collection of people who
work together to achieve a wide
variety of goals.
 ORGANIZATIONAL BEHAVIOR
 It is defined as a the actions and
attitudes of people in
organizations.
 It is the study of human behavior
in organizational settings, how
human behavior interacts with the
organization, and the organization
itself.
 EXHIBIT 1
THE NATURE OF ORGANIZATIONAL BEHAVIOR

Environment

INDIVIDUAL
HUMAN BEHAVIOR THE INDIVIDUAL –
IN ORGANIZATIONAL
ORGANIZATIONAL INTERFACE
SETTINGS

THE
ORGANIZATION
Exhibit 1 illustrates this view of
organizational behavior. It shows the
linkages among human behavior in
organizational settings, the individual-
organizational interface, the
organization, and the environment
surrounding the organization.
• Each individual brings to an organization
a unique set of personal characteristics,
experiences from other organizations,
and personal background. Therefore,
organizational behavior must look at the
unique perspective that each individual
brings to the work setting.
• Organizational Behavior must look at the
unique perspective that each individual
brings the work settings.
• Points of contact include managers, the
formal policies and procedures of the
organization, and various changes
implemented by the organization.
• The organization is affected by
individual’s presence and absence.
• The organizational itself represents a
crucial perspective from which to view
organizational behavior.
• Understanding factors such as:
- performance evaluation and reward
systems
- decision-making and communication
patterns
o can complicate a manager’s ability to
understand and manage others
o can also provide unique opportunities to
enhance personal and organizational
The field of organizational behavior can
both existing and complex. Myriad
variables and concepts impact the
interactions described, and together these
factors can greatly complicate a manager’s
ability to understand, appreciate, and
manage others in an organization.
However, they can also provide unique
opportunities to enhance personal and
organizational effectiveness. They key is
understanding.
 HISTORICAL ROOTS of
ORGANIZATIONAL BEHAVIOR
1. Very few large business organizations
existed until around a hundred years
ago.
2. Many of the initial players interested
in studying organizations were
economists.
 SCIENTIFIC MANAGEMENT
One of the first approaches to the study of
management, popularized during the early
1990’s.

HARRINGTON FRANK and LILLIAN

HENRY GANT
EMERSON GILBRETH
FREDRIC W. TAYLOR

• Commonly associated
with scientific
management.
• He noticed a
phenomenon, which
he named
“soldiering” .
TWO INNOVATIVE TECHNIQUES DEVELOPED BY
TAYLOR
1. He scientifically studied all jobs at the
Midvale plant and developed a standardized
method for performing each one.
2. installed a piece-rate pay system in which
each worker we paid for the amount of work
he completed during the workday

(Taylor believed that money was the only

significant motivational factor in the
workplace.)
CRITICS OF TAYLOR’S SCIENTIFIC MANAGEMENT

• Laborers opposed scientific management because

of its explicit goal of getting more output from
workers.
• Congress investigated his methods and ideas
because some argued his incentives system would
dehumanize the workplace and reduce workers to
little more than drones.
• Later theorists recognized that his views on
employee motivation were inadequate and
narrow
• There have been allegations that he falsified
some of his research findings and paid someone
to do his writing for him.
In every case, Taylor claimed his ideas and
methods greatly improved worker output.

His book, Principles of Scientific

Management, published in 1911, was
greeted with enthusiasm by
practicing managers and
quickly became a standard
reference.
 CLASSICAL ORGANIZATIONAL
THEORY
 This perspective is concerned with
structuring organizations effectively.
 Focused on how a large number of
workers and managers could be most
effectively organized into an overall
structure.
Major Contributors to Classical
Organization Theory

Henri Fayol Max Weber Lyndall Urwick

BUREAUCRACY
It is an organizational structure in
which tasks are specialized under a given
set of rules and a hierarchy of authority.

DIVISION OF LABOR
It is the separation of work loads
into small segments to be performed by
one or more people.
• In contrast to Weber’s views,
contemporary organization theorists
recognize that different organizational
structures may be appropriate in
different situations.
 THE EMERGENCE OF ORGANIZATIONAL
BEHAVIOR

A few early writers and managers,

however, recognized the importance of
individual and social processes in
organizations.
 PRECURSORS OF ORGANIZATIONAL
BEHAVIOR

ROBERT OWEN
• Early 19th century; British
industrialist
• He improved working
conditions, raised
minimum ages for hiring children,
introduced meals for employees, and
shortened working hours.
HUGO MUNSTERBERG
• Early 20th century; German
Psychologist
• He argued that the field of
psychology could provide important
insights into areas such as
motivation and the hiring new
employees.
MARY PARKER FOLLETT
• writer in the early 1900’s
• believed that management should
become more democratic in its
dealings with employees.
• argued that organizations should
strive harder to accommodate their
employees’ needs
1930s – A notable change occur in
management’s perceptions on the
relationship between individual and the
workplace.
 THE HAWTHORNE STUDIES
 Studies were conducted between 1927 and 1932
at Western Electric’s Hawthorne plant near
Chicago.

 Several researchers were involved, the best

known being Elton Mayo and Fritz
Roethlisberger, Harvard faculty members and
consultants, and William Dickson, chief of
Hawthorne’s Employee Relations Research
Development.
 The first major experiment at
Hawthorne: studied the effects of different
levels of lighting on productivity.

 The groups productivity was measured and

compared with that of group whose lighting
was left unchanged.
 The productivity of both groups continued
to increase as lighting increased.
 The productivity start to decline when the
lighting had become almost as dim as
moonlight.
 Second major experiment at
Hawthorne: a piecework incentive system
was established for a nine-man group that
assembled terminal banks for telephone
exchanges.
• Researchers found instead that the group
as a whole established an acceptable
level of its members.
• Individuals who failed to meet this level
were dubbed “chiselers” and those
exceeded it by too much were branded
“rate busters”.
Hawthorne Researchers Conclusions
 Human element in the workplace was
considerably more important than previously
believed.
 Lighting experiment suggested productivity
might increased simply because workers given
special treatment and felt more valued or
more pressured to perform well.
 Incentive system experiment showed that
being accepted as part of the group evidently
meant more to the workers than earning extra
money.
 HUMAN RELATIONS MOVEMENT
• Foundation for the entirely new school of
management thought that came to be
known as the human relations movement.
• The basic premises of it are that people
respond primarily to their social
environment, that motivation depends
more on social needs than on economic
needs, and that satisfied employees work
harder than unsatisfied employees.
BEHAVIORAL THEORY OF MANAGEMENT

All people have complex needs, desires

and attitudes. The fulfillment of needs is
the goal toward which employees are
motivated.
 DOUGLAS McGREGOR
Human relationist; known for his classic
book The Human side of Enterprise
He identified two opposing perspectives

Theory X: a pessimistic view of human

nature and employee behavior
Theory Y: optimistic and positive view of
employees; representative of the human
relations perspective
 Exhibit 2
THEORY X AND THEORY Y
Theory X Assumptions Theory Y Assumptions

1. People do not like work and try 1. People do not naturally dislike
to avoid it. work; work is a natural part of
their lives.

2. People do not like work, so 2. People are internally

managers have to control, direct, motivated to reach objectives to
coerce, and threaten employees which they are committed.
to get them to work toward
organizational goals.
3. People prefer to be directed, People are committed to goals to
to avoid responsibility, to want the degree that they receive
security; they have little personal rewards when they
ambition. reach their objectives.
4. People will seek and
accept responsibility under
favorable conditions.

5. People have the capacity to

be innovative in solving
organizational problems.

6. People are bright, but under

most organizational conditions
their potential are
underutilized.
Maslow’s theory assumes that motivation arises
from hierarchical series of needs. As the needs
of each level are satisfied, the individual
advances to the next level.
Although the Hawthorne studies and the
human relations movement played major
roles in developing the foundation for
the field of organizational behavior,
some of the early theorists’ basic
premises and assumptions were found to
be incorrect.
 TOWARD ORGANIZATIONAL BEHAVIOR

• Began to emerge as a mature field or

study in the late 1950s and early
1960s.
• Saw the field’s of evolution from the
simple assumptions and behavioral
models of the human relationists to
the concepts of methodologies of a
scientific discipline.
 CONTEMPORARY ORGANIZATIONAL
BEHAVIOR
AN INTERDISCIPLINARY FOCUS
Organizational psychology, is perhaps
the greatest contributor to the field of
organizational behavior. Psychologists study
human behavior, whereas organizational
psychologists specifically address the behavior
of people in organizational settings. Many of
the concepts that interest psychologists, such
as individual differences and motivation, are
also central to studying of organizational
behavior.
 Sociology also has had a major impact
on the field of organizational behavior.
Sociologists study social systems such
families, occupational classes, and
organizations. Because a major concern of
organizational behavior is the study of
organizational structures, the field clearly
overlaps with areas of sociology that focus
on the organization as a social system.
 Anthropology is concerned with the
interactions between people and their
environments, especially their cultural
environment. Culture is a major
influence on the structure of
organizations as well as on the behavior
of individual people within organizations.
 Political science also interests
organizational behaviorists. We usually
think of political science as the study of
political systems such as governments. But
themes of interest to political scientists
include how and why people acquire
power, political behavior, decision-making,
conflict, the behavior of interest groups,
and coalition formation. These are also
major areas of interest in organizational
behavior.
 Economists study the production,
distribution, and consumption of goods and
services. Organizational behaviorists share the
economist’s interest of topics such as labor
market dynamics, productivity, human resource
planning and forecasting, and cost-benefit
analysis.

Engineering has also influenced the field

of organizational behavior. Industrial engineering
in particular has long been concerned with work
measurement, productivity measurement, work
flow analysis and design, job design, labor
relations.
 Medicine has influenced
organizational behavior in connection with
study of human behavior at work, specially
in the area of stress. Increasing research is
showing that controlling the causes and
consequences of stress in and out of
organizational settings is important for the
well-being of the individual as well as that
of the organization.
A DESCRIPTIVE NATURE
A primary goal of organizational
behavior is to describe relations
between two or more behavior variables.

Organizational behavior is
descriptive for several reasons: the
immaturity of the filed, the complexities
inherit in studying human behavior, and
the lack of valid, reliable, and accepted
definitions and measures.
 THE IMPORTANCE of ORGANIZATIONAL
BEHAVIOR
People are born and educated in
organizations, acquire most of their material
possessions from organizations, and die as
members of organizations. Many of our
activities are regulated by organizations called
governments. Most adults spend the better
part of their lives working in organizations. It is
because organizations influence our lives so
powerfully, we have every reason to be
concerned about how and why those
organizations functions.
 Organizational behavior can greatly
clarify the factors that affect how
managers manage. It is the field’s job to
describe the complex in which managers
work and to define the problems associated
with the realm. The value of organizational
behavior is that it isolates important
aspects of the manager’s job and offers
specific perspectives on the human side of
management: people as organizations,
people as resources, and people as people.
 CONTEXTUAL PERSPECTIVES on
ORGANIZATIONAL BEHAVIOR

1. THE SYSTEMS PERSPECTIVE

The system perspective, or the theory
of systems, was first developed in the
physical sciences, but it has been extended
to other areas, such as management. A
system is an interrelated set of elements
that function as a whole.
An organizational system receives four
kinds of inputs from its environment:
material, human, financial, and
informational. The organization then
combines and transforms the inputs and
returns them to the environment in the
form of products or services, profits or
losses, employee behaviors, and
additional information. Finally, the system
receives feedback from the environment
regarding these inputs.
 INFORMATION
• pipelines, crude INPUT
oil and
machinery to
• forecasts about
refine petroleum
future oil supplies,
geological surveys,
FINANCIAL sale productions,
MATERIAL INPUT analyses
INPUT
• money
received from
oil and gas • Effort put by oil
sales, field workers,
stockholders refinery workers,
investment office staff and
company’s
employee

HUMAN INPUT
2. THE CONTINGENCY PERSPECTIVE
Another useful viewpoint for
understanding behavior in organizations
comes from the contingency perspective.
In the early days of management studies
managers searched for universal answers
to organizational questions.
 EXHIBIT 3
UNIVERSAL VERSUS CONTINGENCY APPROACHES

Universal Approach The one best

way of
Organizational responding.
problems or situations
determine…

Contingency Approach
Organizational Elements of the Contingent
problems or situations situation, which ways of
must be evaluated in then suggest… responding.
terms of…
INTERACTIONALISM
It is a relatively new approach to
understanding behavior in organizational
settings. First, presented in terms of
interactional psychology, this view
assumes that individual behavior results
from a continuous and multidirectional
interaction between the characteristics
of a situation. Interactionalism attempts
to explain how people select, interpret,
and change various situations.
 EXHIBIT 4
THE INTERACTIONIST PERSPECTIVE IN
ORGANIZATIONS

Individual

Behavior

Situation