FUNDAMENTALS OF

Organizational Behaviour(O.B)

Sathyanarayana S Rao

Management Consultant

Chapter 1 Outline
Defining Organizational Behaviour
OB: Making Sense of Behaviour in
Organizations
How Will Knowing OB Make a Difference?
Todays Challenges in the Workplace

Sathyanarayana S Rao

Management Consultant

What Is Organizational Behaviour?

1. What is organizational behaviour?
2. Isnt organizational behaviour common sense? Or
just like psychology?
3. How does knowing about organizational behaviour
make work and life more understandable?
4. What challenges do managers and employees face
in the workplace of the twenty-first century?

Sathyanarayana S Rao

Management Consultant

Organizational Behaviour
A field of study that investigates the impact of
individuals, groups, and structure on behaviour
within organizations; the aim is to apply such
knowledge toward improving organizational
effectiveness.

Sathyanarayana S Rao

Management Consultant

Why Do We Study OB?

To learn about yourself and others
To understand how the many organizations you
encounter work.
To become familiar with team work
To help you think about the people issues faced by
managers and entrepreneurs

Sathyanarayana S Rao

Management Consultant

What Is an Organization?
A consciously coordinated social unit:
composed of a group of people
functioning on a relatively continuous basis
to achieve a common goal or set of goals.

Sathyanarayana S Rao

Management Consultant

The Building Blocks of OB

Psychology
Sociology
Social Psychology
Anthropology
Political Science

Sathyanarayana S Rao

Management Consultant

Exhibit 1-1
Toward an OB Discipline

Sathyanarayana S Rao

Management Consultant

The Rigour of OB
OB Looks at Consistencies
What is common about behaviour, and helps
predictability?

OB Looks Beyond Common Sense

Systematic study, based on scientific evidence

OB Has Few Absolutes

OB Takes a Contingency Approach
Considers behaviour in context
Sathyanarayana S Rao

Management Consultant

Exhibit 1-2
Research Methods in OB

Source: J. R. Schermerhorn, J.G. Hunt, and R. N. Osborn, Organizational Behaviour, 9th Edition, 2005, p. 4. Copyright 2005 John Wiley & Sons, Inc. Reprinted
with the permission of John Wiley & Sons, Inc.

Sathyanarayana S Rao

Management Consultant

How Will Knowing OB Make a

Difference?
For Managers
Knowing organizational behaviour can help you
manage well and makes for better corporations.
Managing people well leads to greater
organizational commitment.
Finally, managing well may improve
organizational citizenship.

Sathyanarayana S Rao

Management Consultant

How Will Knowing OB Make a

Difference?
For Individuals
What if Im not going to work in a large organization?
The theories generally apply to organizations of any
size.
What if I dont want to be a manager?
To some extent, the roles of managers and employees
are becoming blurred in many organizations.
While self-employed individuals often do not act as
managers, they certainly interact with other
individuals and organizations as part of their work.
Sathyanarayana S Rao

Management Consultant

Bottom Line: OB Is For Everyone

Organizational behaviour is not just for managers.
The roles of managers and employees are becoming
blurred in many organizations.
Managers are increasingly asking employees to share in
their decision-making processes rather than simply follow
orders.

OB applies equally well to all situations in which you

interact with others: on the basketball court, at the
grocery store, in school, or in church.

Sathyanarayana S Rao

Management Consultant

Exhibit 1-4
Basic OB Model
Organization systems level
Group level

Individual level

Sathyanarayana S Rao

Management Consultant

Todays Challenges
in our Workplace
Challenges at the Individual Level

Individual Differences
Job Satisfaction
Motivation
Empowerment
Behaving Ethically

Sathyanarayana S Rao

Management Consultant

Todays Challenges
in our Workplace
Challenges at the Group Level
Working With Others
Workforce Diversity

Sathyanarayana S Rao

Management Consultant

Todays Challenges
in the our Workplace
Challenges at the Organizational Level

Productivity
Developing Effective Employees
Putting People First
Global Competition
Managing and Working in a Multicultural World

Sathyanarayana S Rao

Management Consultant

Todays Challenges
in the our Workplace
Challenges at the Organizational Level
Productivity
A performance measure including
effectiveness and efficiency.
Effectiveness
The achievement of goals.
Efficiency
The ratio of effective work output to the input
required to produce the work.
Sathyanarayana S Rao

Management Consultant

Developing Effective Employees

Organizational Citizenship Behaviour (OCB)
Discretionary behaviour that is not part of an
employees formal job requirements, but that
nevertheless promotes the effective functioning
of the organization.

Sathyanarayana S Rao

Management Consultant

Putting People First

Putting people first generates a committed

workforce and positively affects the bottom
line.
People will work harder when they feel they
have more control and say in their work.

Sathyanarayana S Rao

Management Consultant

How to Put People First

Provide employment security.

Hire well.
Create self-managed teams.
Pay well.
Provide extensive training.
Reduce status differences.
Share information about organizational
performance.

Sathyanarayana S Rao

Management Consultant

Global Competition

In recent years, Indian businesses have faced

tough competition from the United States,
Europe, Japan, and even China, as well as
from other companies within our borders.
To survive, they have had to reduce costs,
increase productivity, and improve quality.

Sathyanarayana S Rao

Management Consultant

Managing and Working in a

Multicultural World
Managers and employees must become
capable of working with people from different
cultures:
Multinational corporations are developing
operations worldwide.
Companies are developing joint ventures with
foreign partners.
Workers are pursuing job opportunities across
national borders.
Sathyanarayana S Rao

Management Consultant

Summary and Implications

1. What is organizational behaviour?
OB is a field of study that investigates the impact
that individuals, groups, and structure have on
behaviour within an organization.
2. Isnt organizational behaviour common sense? Or
just like psychology?

Sathyanarayana S Rao

OB is built on contributions from a number of

behavioural disciplines, including psychology,
sociology, social psychology, anthropology, and
political science. It goes beyond common sense.
Management Consultant

Summary and Implications

3. How does knowing about organizational behaviour
make work and life more understandable?
OB helps people manage well, and managing well
can lead to greater organizational commitment by
employees.
4. What challenges do managers and employees face in
todays workplace?
Each level of analysisthe individual, the group,
and the organizationpresents challenges.
Sathyanarayana S Rao

Management Consultant

OB at Work

Sathyanarayana S Rao

Management Consultant

For Review
1.
2.
3.
4.

5.
6.
7.
8.

Define organizational behaviour.

What is an organization? Is the family unit an organization? Explain.
Behaviour is generally predictable, so there is no need to formally
study OB. Do you agree or disagree with this statement? Why?
What does it mean to say that OB takes a contingency approach in its
analysis of behaviour?
What are the three levels of analysis in our OB model? Are they
related? If so, how?
What are some of the challenges and opportunities that managers face
in todays workplace?
Why is job satisfaction an important consideration for OB?
What are effectiveness and efficiency, and how are they related to
OB?

Sathyanarayana S Rao

Management Consultant

For Critical Thinking

1.
2.

3.

4.

OB is for everyone. Build an argument to support this

statement.
Why do you think the subject of OB might be criticized as
being only common sense, when we would rarely hear such
a criticism of a course in physics or statistics? Do you think
this criticism of OB is fair?
On a scale of 1 to 10 measuring the sophistication of a
scientific discipline in predicting phenomena, mathematical
physics would probably be a 10. Where do you think OB
would fall on the scale? Why?
Can empowerment lead to greater job satisfaction?

Sathyanarayana S Rao

Management Consultant

Learning About Yourself Exercise

1.
2.
3.
4.

Taking initiative
Goal setting
Delegating effectively
Personal productivity and
motivation
5. Motivating others
6. Time and stress management
7. Planning
8. Organizing
9. Controlling
10. Receiving and organizing
information
11. Evaluating routine information
12. Responding to routine information

Sathyanarayana S Rao

Management Consultant

13. Understanding yourself and others

14. Interpersonal communication
15. Developing subordinates
16. Team building
17. Participative decision making
18. Conflict management
19. Living with change
20. Creative thinking
21. Managing change
22. Building and maintaining a power
base
23. Negotiating agreement and
commitment
24. Negotiating and selling ideas

Learning About Yourself

Scoring Key

Director: 1, 2, 3
Producer: 4, 5, 6
Coordinator: 7, 8, 9
Monitor: 10, 11, 12

Mentor: 13, 14, 15

Facilitator: 16, 17, 18
Innovator: 19, 20, 21
Broker: 22, 23, 24

Source: Created based on material from R. E. Quinn, S. R. Faerman, M. P. Thompson, and M. R. McGrath, Becoming A Master Manager: A Competency
Framework (New York: John Wiley & Sons, Inc. 1990), Chapter 1.

Sathyanarayana S Rao

Management Consultant

Breakout Group Exercises

Form small groups to discuss the following topics:
1.

Consider a group situation in which you have worked. To what extent

did the group rely on the technical skills of the group members vs. their
interpersonal skills? Which skills seemed most important in helping the
group function well?

2.

Identify some examples of worst jobs. What conditions of these jobs

made them unpleasant? To what extent were these conditions related to
behaviours of individuals?

3.

Develop a list of organizational puzzles, that is, behaviour youve

observed in organizations that seemed to make little sense. As the term
progresses, see if you can begin to explain these puzzles, using your
knowledge of OB.

Sathyanarayana S Rao

Management Consultant

Working With Others Exercise

This exercise asks you to consider the skills outlined in the
Competing Values Framework to develop an understanding of
managerial expertise. Steps 14 can be completed in 1520
minutes.
1. Using the skills listed in Learning About Yourself, identify the 4
skills that you think all managers should have.
2. Identify the 4 skills that you think are least important for managers
to have.
3. In groups of 57, reach a consensus on the most-needed and leastneeded skills identified in Steps 1 and 2.
4. Using Exhibit 1-6, determine whether your ideal managers would
have trouble managing in some dimensions of organizational
demands.
Sathyanarayana S Rao

Management Consultant

Exhibit 1-5
Competing Values Framework

External Focus

Internal Focus

Flexibility

Source: Adapted from K. Cameron and R.

E. Quinn, Diagnosing and Changing
Organizational Culture: Based on the
Competing Values Framework (Reading,
MA: Addison Wesley Longman, 1999).

Control
Sathyanarayana S Rao

Management Consultant

Competing Values Framework

Internal-External Dimension
Inwardly, toward employee needs and concerns and/or production
processes and internal systems
or
Outwardly, toward such factors as the marketplace, government
regulations, and the changing social, environmental, and technological
conditions of the future

Flexibility-Control Dimension
Flexible and dynamic, allowing more teamwork and participation; seeking
new opportunities for products and services
or
Controlling or stable, maintaining the status quo and exhibiting less
change

Sathyanarayana S Rao

Management Consultant

Exhibit 1-6 Skills for Mastery in the

New Workplace
Flexibility

1. Understanding
yourself and others
2. Interpersonal
communication
3. Developing
subordinates
1. Team building
2. Participative
decision making
3. Conflict
management

1. Living with change

2. Creative thinking
3. Managing change

Mentor Innovator

Facilitator

Broker

Monitor

Producer

1. Building and maintaining

a power base
2. Negotiating agreement
and commitment
3. Negotiating and
selling ideas

Internal

External

1. Receiving and
organizing information
2. Evaluating
routine information
3. Responding to
routine information

Coordinator Director

1. Planning
2. Organizing
3. Controlling

1. Taking initiative
2. Goal setting
3. Delegating effectively

Control
Source: R.E. Quinn. Beyond Rational Management. San Francisco: Jossey-Bass Inc., 1988, p. 86.

Sathyanarayana S Rao

Management Consultant

1. Personal productivity
and motivation
2. Motivating others
3. Time and stress
management

Supplemental Material

Slides for activities I do in my own

classroom

Sathyanarayana S Rao

Management Consultant

Exercise
In groups of 6
Introduce yourselves.
Pick an interviewer.
Decide on questions or topics you want interviewer to ask
me.

The interview
Introduce interviewer to me and the class.
Ask one question from your list (we will go around the
groups with one question at a time).
Sathyanarayana S Rao

Management Consultant