Organizational

Behaviour
What is an Organization?
 A consciously coordinated social unit, composed
of two or more people, that functions on a
relatively continuous basis to achieve a common
goal or set of goals.
People, in real sense, are a lasting competitive advantage
of any organization. Everything else – almost everything
can be replicated – products, brands, services, assets and
infrastructure, but not your people resources. What you
indeed require is developing a strong employer brand – a
brand that describes how exciting it is to work in an
organization, how satisfying it is to stay on in the
organization for the sake of consistently satisfying and a
mutually happy association.
 A Provincial Sport Governing Body
 The Board of Directors, The Office Staff
 Your Project Team
 The team “Lagan”
Common Elements in Organisations
 A reason for existing
 People
 Tasks are to be performed if the reason for existing
is to be realised
 Structure or framework clarifying responsibility for
what, and for whom
Management
 Manage men tactfully
Organizational Behaviour
 . . . a field of study that investigates the impact
that individuals, groups and structure have on
behaviour within organizations, for the purpose
of applying such knowledge toward improving an
organization’s effectiveness.
OB
 OB is concerned with what people do in the
organization & how their behaviour affects
the organizational performance.
Why Do We Study OB?
 To learn about yourself and how to deal with others
(knowing how you work will help you understand how others
work; help you work with…)
 You are part of an organization now, and will
continue to be a part of various organizations
(this class is an organization, your team will be an
organization)
 Organizations are increasingly expecting
individuals to be able to work in teams,
at least some of the time
(committees, groups)
 Some of you may want to be managers or
entrepreneurs
(have to supervise or deal with other people)
GOALS OF ORGANIZATIONAL BEHAVIOUR

 Predicting organizational behaviour

 Explaining organizational behaviour

 Managing organizational behaviour

Formal vs. Informal Organization
Formal Organization - the official, legitimate,
and most visible part of the system
Informal Organization - the unofficial and less
visible part of the system

Hawthorne Studies: studies conducted during the 1920s

and 1930s that discovered the existence of the informal
organization
 Formal & Formal organization
(overt)
Informal Goals & objectives
Policies & procedures
Elements of Job descriptions
Financial resources
Organizations Authority structure
Communication channels
Products & services
Social
Informal organization Surface
(covert)
Beliefs & assumptions
Perceptions & attitudes
Values
Feelings, such as fear, joy
anger, trust, & hope
Group norms
Informal leaders
 Multidisciplinary anchor
• Psychology---Perception, Attitudes, Personality, Job
stress, Emotions, Leadership Patterns , Learning,
Motivation

• Sociology--- Team dynamics, Roles, Socialization ,

Power, Organizational structure.

• Anthropology---Corporate culture, Cross cultural

dynamics.
•Political Science---Intergroup conflict, Politics and
Power struggles, Decision making, Organizational
environments.

•Social Psychology--- Job design, Productivity

Emerging Disciplines

•Communications--- Knowledge management,

e-mail, Socialization

•Information systems--- Team dynamics, Decision

making

•Women’s studies---Power-relations, Perceptual

biases.
Systematic Research anchor
• Scientific method
• Research propositions
• Collection of data
• Statistical analysis
• Personal bias discarded

• Grounded theory
• Cyclical data collection and theory development
• More observation, participation, realistic
Contingency anchor

• Solutions-situations-results

• Leadership styles
Multiple levels of analysis anchor
 Hewlett Packard may have lots of buildings &
equipments, but its CEO Carly Florina says
that her job is to nurture something that is
alive. “I think that the company is a living
system”. “It is an organism, it is operating in
other living system, and a leader has to think
about the company as a living , breathing
system”.
 The Organization as an Open
System

System

Transformation
Inputs Process Outputs

Raw Materials Employees ’ Work Products and Services

Human Resources Activities Financial Results
Capital Management Activities Information
Technology Technology and Employee Behaviour
Information Operations Methods

Feedback
Basic OB Model, Stage I

Organization systems
level
Group
level

Individual
level
Developing an OB Model
 Dependent Variables
 Productivity
 Absenteeism
 Turnover
 Job Satisfaction
 Organizational Commitment

 Independent Variables
 Individual-Level Variables
 Group-Level Variables
 Organizational Systems-Level Variables
Dependent Variables
 A Dependent Variable is the key factor that you
want to explain or predict & that is effected by some
other factor.
 In OB the Dependent Variables are:
 Productivity
 Absenteeism
 Turnover
 Job Satisfaction
 Organizational Commitment
Productivity
 An organization is productive if it achieves its
goals & does so by transferring its inputs to
outputs at the lowest cost.
 Productivity implies its concern for both
efficiency & effectiveness.
Absenteeism
 Absenteeism is defined as the failure to report
to work.
Turnover
 Turnover is the voluntary or involuntary
permanent withdrawal from an organization.
Job Satisfaction
 A positive feeling about ones job resulting
from the evaluation of its characteristics
Organizational Citizenship Behaviour
 OCB is discretionary behaviour that is not
part of employees formal job requirement but
that nevertheless promotes the effective
functioning of the organization.
Independent Variables
 An Independent Variable is the presumed cause of
some change in the dependent variable.
 In OB Independent Variables lies at three different
levels:
 Individual-Level Variables
 Group-Level Variables
 Organizational Systems-Level Variables
Challenges and Opportunities
for OB:
A Managerial Perspective
Some Contemporary Management
Concerns
 A Focus on Quality & Productivity
 Workforce Diversity
 Globalization
 Responding to Outsourcing
 Employee-Organization Relationships
 Empowerment
 Stimulating Innovation & Change
 Working in Networked Organizations
 Work-Life Balance
 Improving Ethical Behaviour
Total Quality Management-
 To improve quality and productivity, many
companies are implementing Total Quality
Management--a philosophy of management driven
by the constant attainment of customer satisfaction
through the continuous improvement of all
organizational processes.
 Total quality management has implications for OB
since it requires employees to rethink what they do
and become involved in workplace decision making.
TQM
The following are the main elements of TQM:
 Intense focus on the customer includes not only outsiders
who buy the services or products of the organization but
also internal customers (such as shipping or accounts
receivable) who interact with and serve the organization.
 Concern for continual improvement means “very good is
not good enough” and quality can always be improved.
TQM
 Improvement in the quality of everything the organization does
applies not only to the final product but also to how the
organization handles deliveries, complaints, and public contact,
for example.
 TQM requires accurate measurement of every critical
performance variable in the organization’s operation. These
variables are compared against standards to identify problems,
trace them to their roots, and eradicate them.
 TQM involves the empowerment of employees and teams as a
means of finding and solving problems in the workplace.
 Improving Quality
and Productivity
Customer
Focus

Continuous Organizational
Improvement Improvement

Accurate Employee
Measurement Empowerment
Workforce Diversity

 Workforce diversity means that organizations are

more heterogeneous in terms of race, gender, and
ethnicity.
 The challenge for organizations is to be more
accommodating to the lifestyles, family needs,
and work styles of diverse groups of people.
Example:
 Founded in 1939 and headquartered in Palo Alto, California
USA, Hewlett-Packard is a leading technology solutions
provider for consumers and businesses in Unix Servers,
Linux Servers, Windows Servers, Printers, PCs among
other things. Hewlett-Packard is having more than 540 sales
and support offices worldwide in more than 162 countries.
It employed 70,000 people worldwide and brings together
incomparable experiences and global insights to provide its
customers with the right solutions for their businesses and
home computing needs.
Implications for managers
 Managers will need to shift their philosophy from treating everyone
alike to recognizing and responding to individual differences in
ways that will ensure employee retention and productivity. At the
same time, they must guard against discrimination.
 When managed well, diversity can increase creativity and improve
decision making. When managed poorly, diversity can lead to
higher turnover, communication problems, and interpersonal
conflicts.
Globalization
 Globalization can be
described as a process by
which the people of the
world are unified into a
single society and function
together. This process is a
combination of economic,
technological, sociocultural
and political forces.
 Ranbaxy, India's first multinational company,
today has a whooping 70% of its revenues
coming from abroad, some of its label being
market leaders in their segment. It has six
manufacturing plant outside India and their
activity is supported by close to 2000
overseas employees.
 At one point of time, IBM had people working
from 44 nations in one of its project.
The Challenge of Globalization

Working in Working with

Foreign Multicultural
Countries Diversity
Implications for Managers
 First, managers are more likely to find themselves in foreign
assignments. So they will be managing workers who will
probably be very different in needs, aspirations, and attitudes
from the workers they managed in the United States.
 Second, even if managers stay at home, they will be working
with bosses, peers, and subordinates who were raised in
different cultures. To work effectively in such situations,
managers will need to understand the cultures with which they
must interact and adapt their management styles as needed.
 Implications of globalization:
 New organizational structures
 Different forms of communication
 More competition, change, mergers,
downsizing, stress
 Need more sensitivity to cultural
differences
Responding to Outsourcing
 On shore
 Off shore
Call Centres
 Call Centres are one of the capital intensive
BPO’s.
KPO’s
 Knowledge Process Outsourcing
 It involves software solutions, financial
services, biotechnology research, legal
services.
Virtual teams
 “Virtual work teams", which consist of people
who are geographically separated and who
work across boundaries of space and time
using computer-driven communication
technologies.
 Verifone, maker of computerized swipe
machines that read credit card details, prides
itself with the fact that its 3,000 employees
are in different locations. The use of virtual
teams has been a strategy of the company
since 1981.
The Employment Relationship
The Employment Relationship
 Employability

 Contingent work
Employability
 “New deal” employment relationship
1. Flexibility
2. Compressed Worksheets
3. Job Sharing
4. Telecommunicating
 Continuously learn new skills
Contingent work
 No contract for long-term employment
 Minimum hours of work vary
Empowerment
 In Marriott W.L.Gore & National West
Minister Bank employees are now called as
associates .Decision making is being pushed
down to the operating level, where workers
are being given the freedom to make choices
about schedules & procedures to solve work
related problems.
Empowering the Workforce

Managers Workers Are

Are Giving Accepting
Up Controls Responsibility
Stimulating Innovation & Change
Nokia has continually adapted to its changing
environment. The Finnish company began as a pulp
and paper mill in 1865, then moved into rubber,
cable wiring, and computer monitors. In the 1980s,
Nokia executives sensed an emerging market for
wireless communication. Today, Nokia is a world
leader in cellular telephones
Work-Life Balance
Ethical Behaviour

Ethics: used to describe the kinds of

values and morals an individual society
finds desirable or appropriate.
Improving Ethics in Workplace
 Compliance with the Law
 Provide in-house advisers
 Create protection mechanisms
 Write and distribute codes of ethics
 Offer seminars, workshops, and training
Ethical Dilemmas
1. Sam works for you .He is technically
capable & a good worker ,but he does not get
well along with others in the work group.
When Sam has an opportunity to get a
transfer you encourage him to take it .What
would you say to potential supervisor.
2. Your boss has told you that you must reduce
your work group by 30% .Which criteria
would you use to layoff workers & why?
3. Imagine that you are CEO of a company in a
highly competitive industry. You learn that a
competitor has made an important scientific
discovery that is not patentable & will give
that company an upper edge. What would be
your stand than & why.
Thank You