Contents

Introduction
Definitions of OB
Historical evolution of

OB as a discipline
Contributing disciplines
to the OB field

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

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, decisionmaking, power, conflict and negotiation.

Organizational Behavior

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

Organizational Behavior

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)
5

Organizational Behavior

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

2.
3.
4.
5.
6.

organizational setting;
drawing on theory, methods and principles from such
disciplines--as psychology, sociology, and cultural anthropology to learn about
individual perception, values, learning capabilities, and actions
while working with groups and within the total organization;
analyzing the external environments effect on the organization
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

Organizational Behavior

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

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

Organizational Behavior

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 Smiths 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.

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 peoples skills and physical abilities with
specific tasks.

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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

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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.
12

Organizational Behavior

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.

13

Organizational Behavior

6.
7.
8.

9.
10.
11.
12.
13.
14.

14

Subordinates of individual interest to general interest Individual

or group goals must not take priority over business goals.
Remuneration of personnel It should be fair, encourage effort
and there should be no overpayment.
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.
Scalar chain (line of authority) Flow of communication should
be up and down the line of authority.
Order Material and personnel should be at proper place.
Equity People should be treated with kindness and justice.
Stability of tenure of personnel Quick turnover of people should
be avoided because it takes time to develop expertise.
Initiative Employees should be encouraged to take initiatives.
Esprit de corps All efforts should be made to maintain peace
and harmony within the organization.

Organizational Behavior

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 Webers 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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Organizational Behavior

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 managers task was to coordinate group efforts.
Managers and workers should be like partners.

16

Organizational Behavior

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.

17

Organizational Behavior

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.
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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.

19

Organizational Behavior

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

20

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.

Organizational Behavior

Maslows
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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Organizational Behavior

D) Behavioral Science
Theorists
1. B.F. Skinner His research on classical and operant conditioning
and behavior modification affected the design of
organizations 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.

23

Organizational Behavior

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.

24

Organizational Behavior

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.

25

Organizational Behavior

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.
26

Organizational Behavior

Hygiene Factors

Motivational 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

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.

27

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

28

Organizational Behavior

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.
29

Organizational Behavior

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.
30

Organizational Behavior

Motivation and Job

Satisfaction
Why is this important?

Are you tired of unmotivated, uninterested,

and inept workers?

One-third to one-half your life is spent at
work!!

Theories of Motivation
Content Theories: Focus on the importance

of the work (e.g., challenges and

responsibilities)
Specific needs that motivate human behavior

Process Theories: Deal with the cognitive

processes used in making decisions about

our work

Content Theories
Achievement Motivation Theory: David

McClelland. Emphasizes need to accomplish

something. Linked to successful managers
Favor environment where they can assume

responsibility
Take calculated risks and set attainable goals
Need continuing recognition and feedback
Managers high in achievement motivation

show more respect for subordinates and use

more participatory systems

Need Hierarchy Theory

Abraham Maslow: proposed that we have a

hierarchy of needs. Once one is fulfilled we

can move on to the next
Physiological
Safety
Belonging and Love
Esteem
Self-Actualization

ERG Theory
Alderfer
Similar to Maslow. We have needs, but in

this case they are not hierarchically

arranged
Satisfying a need may increase its strength
Existence Needs
Relatedness Needs
Growth Needs

Motivator-Hygiene (Two
Factor) Theory

Motivator Needs: internal to work itself. If

conditions are met, job satisfaction occurs

Job enrichment: expand a job to give

employee a greater role in planning,

performing, and evaluating their work
Hygiene Needs: Features of work

environment. If not met, job dissatisfaction

occurs

Job Characteristics Theory

If employees have a high need for growth,

specific job characteristics lead to

psychological conditions that lead to
increased motivation, performance, and
satisfaction.
Skill variety
Unity of a job
Task significance
Autonomy
Feedback

Process Theories
Valence-Instrumentality-Expectancy (VIE)

Theory: people will work hard if they

expect their effort to lead to reward
Importance of outcome determines its
strength as a motivator supported by
research

Equity Theory
Motivation is influenced by how fairly we

feel we are treated at work

Benevolent Workers: martyrs. Feel guilt

when rewarded
Equity Workers: Sensitive to fairness. Normal
Entitled Workers

Goal-Setting Theory
Idea that our primary motivation on the job

is defined in terms of our desire to achieve

a particular goal
Research shows that having goals leads to

better performance than not having goals

Specific goals are more motivating than
general
Moderately difficult goals are most
motivating

High Performance Cycle

Expands on Goal Setting Theory
Specific, attainable goals influenced by
Moderators (commitment to goal, self-

efficacy, task difficulty, feedback) and

Mediating Mechanisms (universal task
strategies such as direction of attention,
effort and persistence)

Job Satisfaction
Overall measures of satisfaction may be too

broad: current measures address different

facets of job satisfaction
Overall job satisfaction rate has remained the
same for over 50 years
Rates are much lower for government
workers
When people say they are satisfied, they
often mean they are not dissatisfied!!

Personal Characteristics and

Job Satisfaction
Age: in general, increases with age
Malcontents have stopped working
Older workers have greater chance of

fulfillment
Gender: inconclusive results
Race: whites are happier
Cognitive Ability: slight negative relationship

between level of education and satisfaction

Personal Characteristics,
Cont.
Use of Skills

Job Congruence
Personality: less alienation and internal

locus of control lead to higher satisfaction

Occupational Level: the higher the status
level the greater the satisfaction

Low Satisfaction and Job

Behavior
Absenteeism: any given day 16-20% of

workers miss work. Costs businesses $30

billion dollars a year
Younger have higher absence rates
Rates are influenced by economic conditions

Turnover: Not always a bad thing!

Functional Turnover: when bad workers leave
Dysfunctional Turnover

LEADERSHIP & SUPERVISION

LEADERSHIP
Leadership
Leadership involves qualities related to a person's
character and behaviors, as well as roles within a
group or organization. It requires that a person have
the ability to guide and influence another person,
group, or both to think in a certain way, achieve
common goals, or provide inspiration for change.
Marquis and Huston (2003) state that leaders:
Often do not have delegated authority, but

obtain their power through other means, such

as influence.
Have a wider variety of roles than do managers.
May not be part of the formal organization.

Leadership Styles
Autocratic
Democratic
Laissez-faire
Situational

Autocratic Leadership
A leadership style characterized by
specific instructions to employees
regarding what, how, and when work
should be done.

Micro-management style
The leader plans, organizes, controls, and
coordinates.
Emphasis is on getting the job done without
regard for input from others.

Autocratic Leadership

(cont.)

Advantages
Efficiency
Employees know the managers

expectations.
Disadvantages
Discourages employees from thinking

about process improvements

Employee dissatisfaction
Decline in worker performance
Does not prepare employees for promotion
or possible advancement

Autocratic Leadership
When to use the

autocratic style
During an

emergency
Managing
temporary
employees
Managing new
employees

(cont.)

Democratic Leadership
A leadership style characterized by
encouragement for employees to
share in the decision-making and
problem-solving processes.

General management style

Considers everyones viewpoint in
decision making
Utilizes team concept in goal setting

Democratic Leadership

(cont.)

Advantages
Employees actively involved in

decision making
Higher employee morale
Stronger employee commitment to
established goals
Disadvantages
Time consuming
Not everyone likes to participate in

decision making.

Democratic Leadership
When to use the

democratic style
Managing employees

who are committed to

their jobs
Managing employees
who are interested in
more responsibility
Managing experienced
and well-trained
employees

(cont.)

Laissez-faire Leadership
A leadership style in which minimal
direction and supervision is given
to workers.

Open management style

Management shares information
Team (or individual employee) is
completely responsible for the
workload.

Laissez-faire Leadership

(cont.)

Advantages
Easy management style to administer
Complete empowerment for employees

Disadvantages
Poor decision making may result.
Some employees do not perform well

without direction and supervision.

Laissez-faire Leadership
(cont.)
When to use

laissez-faire
Managing

experienced, welltrained, and

highly- motivated
workers
Managing homebased employees,
outside
salespersons

Situational Leadership
Leadership characterized by shifts in
management style as appropriate for
individual employees.

The management
style applied
depends on the
needs of each
employee.

Situational Leadership

(cont.)

Advantages
Management style personalized for

each employee
Improved communication
High employee morale
Improved production
Disadvantages
Time consuming
Difficult to manage

Situational Leadership
When to use situational

management
Highly experienced

manager
Manager highly skilled in
human relations
Employees with range of
needs for supervision

(cont.)

Supervision

The Art & Craft of

Supervision
The Art
Interpersonal
and Conceptual
Skills

The Craft

Technical
Skills

Making the Transition

Find out what management expects of you.
Establish your authority.
Get to know your operation.
Get to know your people.
Communicate your expectations.

DON'T DO IT!
Playing favorites.
Doing the work. Let your employees be the technical

workers.
Being emotional.
Lying your way out of things.
Trying to be "One of the Gang."
Taking credit for your employee's successes.
Blaming management for problems.
Selling out your employees.
Refusing to make a proper commitment to the job.
Neglecting to grow into the job.

Qualities of Supervisors
Goal oriented
Bottom line oriented
Communicates and enforces standards
Initiative seeks opportunities to solve

problems
Skillful use of influence
Communicates confidence
in people

Qualities of Supervisors (continued)

Interpersonal sensitivity
Develops and coaches others
Gives performance feedback
Collaboration and team building
Conceptual skills and systematic

problem solving
Concern for image and
reputation

Supervisor Definition
Supervisor has its roots in Latin, where it

means Looks Over

Super which means Very Good and Vision

which means Detailed Focus.

What Is Supervision?
Supervision is the first level of

management in an organization
Supervisors do not do operative work, but

see that it is accomplished through the

effort of others

Who are Supervisors?

A supervisor is the manager who serves as

the link between operative employees and

all other managers

Five Attitudes for Successful

Supervision
I'm
A member of management
Responsible for the performance of my entire

team
Easy to work for
Easy to get along with
Able to forgive myself for mistakes

The Functions of Supervision

Determining how well the work is being
done compared to what was planned
Controlling

Directing & channeling

employee behavior
Obtaining & developing
good people
Distributing the work & arranging
it so that it flows smoothly

Leading
Staffing
Organizing
Planning

Determining the most effective

means for achieving the work

The Functions of Supervision

3 types of skills required of supervisors:
Technical:
Knowledge about machines, processes, and
methods of production
Human relations:
Knowledge about human behavior and the ability to
work well with people
Administrative:
Knowledge about the organization and how it works

Skills & Levels of

Management

What Factors Affect Behavior?

Policies
Peer group
Media
Difference of ethics taught and ethics observed
External influences
Family
Religious
Cultural
Political

Supervisors Responsibility
Know and understand values of the

department, subordinates, self.

Demonstrate integrity.
Instruct, monitor, correct behaviors in

subordinates.

Ethics In The Workplace

Employees ideas of what is acceptable and

not acceptable are based on the

supervisors actions
The supervisors failure to take corrective
action in certain situations can also affect
the behavior of the employees

Areas Requiring Ethical Conduct

Loyalty

Supervisors who are viewed as being interested only

in themselves and their future will have difficulty in

getting the full cooperation of employees

Human relations

This category centers on the supervisors concept of

fairness, particularly in the treatment of subordinates

Overt personal actions

This category includes the supervisors behavior within

the company and how they handle themselves in the

community

Dealing with Dishonest

Employees
A.

B.

C.

Dealing with dishonest subordinates

1.

Recognize the problem, get the facts, and document the

case

2.

Confront the employee

3.

Follow the established disciplinary system

Dealing with dishonest peers or other managers

1.

You may not be able to deal directly with the problem

2.

In most cases, report your suspicions and findings to

your boss and let them confront those involved

Whistle blowing
1.

Whistle blower places himself or herself at risk