FUNDAMENTALS OF

ORGANIZATIONAL BEHAVIOR

What is an Organisation?

Distinct
Purpose

Deliberate
Structure

People

It is a deliberate arrangement of people to accomplish some specific purpose

PURPOSE

The purpose id typically expressed through goals that the organisation hopes to
accomplish

HOW TO ACCOMPLISH
THE PURPOSE?

Through the performance of the people

WHY DO YOU
NEED
STRUCTURE?
Structure is needed to make people to work. Structure may be FLEXIBLE or
TRADITIONAL.

Why Study MBA?

1. UNIVERSALITY OF MANAGEMENT

All Organisational Areas

All Sizes of Organisation

Management is
needed in

All Organisational Levels

All Types of Organisation

2. THE REALITY OF
WORK

You will Either Manage or Be Managed

3. REWARDS AND CHALLENGES OF BEING A MANAGER

REWARDS
1. Create Conducive work
environment
2. Opportunity to think
creatively
3. Help others
4. Coach and nurture
subordinates
5. Work with variety of
people
6. Recognition & status in
the community
7. Influencing
organisational outcomes
8. Salary+Bonus+Stock
Options
9. Good Mangers are
needed

CHALLENGES
1. Do Hard Work
2. More of Clerical than
Managerial
3. Have to Deal with Variety
of Personalities
4. Deal with Limited
Resources
5. Motivate Workers in
Chaotic & Uncertain
situations
6. Success Depends on
Others

Definition Management:

Management is the process of designing and

maintaining
an environment in which individuals working together in groups,
efficiently accomplish selected item

Management is the process of getting things done, through &

with people in organization

Management functions (or) Process of Management:

There are five types of functions in management. They are,
Planning-Defines the goal & establishing strategy.
Organizing-includes determining what task has to be done,

who is to do them.
Staffing-Includes recruitment of people and training them
towards the project.
Leading-Includes the motivating the employees and
directing the activities.
Controlling-It is the process of monitoring the performance.

Managerial Skills

There are three types of skills required by a manager.

They are:
Conceptual Skills-These skills are required by the
employee who are in top level management.
Technical skills- These skills are required by the
employee who are in middle level Management.
Human Relations Skills-These skills are required by the
employee in the supervisory level.

Different Managerial Levels

Top Management

Conceptu
al Skills

Middle Management

Human Relations Skills

Supervisory Level

Technical Skills

Order of Management
Top
Mana
geme
nt

Middle
Manager
s
First-Line Managers
Operatives
(or)
Executive

The Dynamics of people and organizations

A primary goal of management education is to

develop students into managers who can think
ahead, exercise good judgment, make ethical
decisions, and take into consideration the
implications of their proposed actions
Jane Schmidt-Wilk

Jack (John) Welch

Features of Organisation
An Organisation is a powerful tool created by

Human Beings
Organisations live longer
Organisations are not open for everybody
Organisations are systems designed for stability and
control
Organisational relationships are interdependent

What is Johari Window???

The Johari window is a technique used to help people

better understand their relationship with themselves and

others, which was created by psychologists Joseph Luft
(19162014) and Harrington Ingham (19161995) in 1955.

Key Forces of an Organisation

People

Make up the internal social system of an organization

Melting pot of diversity talents, background and perspectives to their jobs
Managers need to be tuned in to these diverse patterns and trends.
Changes in the labor force
Decline in work ethic and rise in emphasis on leisure, self expression, fulfillment and
personal growth
Decreased automatic acceptance of authority and increase in the desire for
participation, autonomy and control.
Skills become obsolete due to rapid technological advances retrain or be displaced
Security needs are prime concern and loyalty diminishes because of downsizing and
outsourcing
Absence of meaningful salary growth has placed renewed emphasis on money as a
motivator

Companies address diversity by becoming compassionate and caring, building

pride without de-valuing others, empowering some without exploiting,
demonstrating openness, confidence, authentic compassion and vulnerability.

Structure

Technology

Defines the formal relationship and use of people in organizations.

Effective coordination of work
Create complex problems of cooperation, negotiation and decision making
Provides he resources with which people work and affects the tasks they
perform
Benefit of technology does more and better work however it restricts
people in various ways
OBs challenge is to maintain the delicate balance between technical and
social systems.

Environment

Internal or external
Organizations are part of a larger system and factors influence them like:
Citizens expect organizations to be socially responsible
New products and competition for customers come from around the globe
(globalization)
The direct impact of unions diminishes
Dramatic pace of change in society.
The external environment influences the attitudes of people, affects working
conditions, and provides competitions for resources and power.

Understanding human behavior and Understanding OB

Definition
OB

systematic study and careful application of knowledge about

how people as individuals and as groups act within
organizations.
Strive to identify ways in which people can act more efficiently
A large number of research studies and conceptual
developments constantly adds up to its knowledge base.
An applied science
Provides useful set of tools at many levels of analysis from
individual, interpersonal relations, intergroups, and whole
system

Goals of OB

Describe

Understand

Why people behave as they do.

Probe for underlying explanations

Predict

how people behave under a variety of conditions.

Predict future employee behavior (tardiness, productive &

unproductive etc.)
Provide preventive actions

Control

At least partially and develop some human activity at work.

Managers need to remember that organizational

behavior is a tool for human benefit

Replacing Intuition with Systematic Study

Intuition
A feeling not necessarily supported by research.

Systematic study
Looking at relationships, attempting to
attribute causes and effects, and drawing
conclusions based on scientific evidence.
Provides a means to predict behaviors.
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Replacing Intuition with Systematic Study

Preconceived
Notions*

The
Facts

*Notion: a general understanding; vague or imperfect conception or

idea of something. Examples: a notion of how something should be
done; his notion of democracy; She had a notion to swim in the
winter.
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Challenges and Opportunities for OB (contd)

Improving Quality and Productivity

Quality management (QM)

Process reengineering

Responding to the Labor Shortage

Changing work force demographics

Fewer skilled laborers
Early retirements and older workers

Improving Customer Service

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Increased expectation of service quality

Customer-responsive cultures

2005 Prentice Hall Inc. All rights reserved.

Challenges and Opportunity for OB (contd)

Improving People Skills
Empowering People
Stimulating Innovation and Change
Coping with Temporariness
Working in Networked Organizations
Helping Employees Balance Work/Life

Conflicts
Improving Ethical Behavior

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Positive Characteristics of OB

Interdisciplinary in nature integrates behavioral sciences,

social sciences and other disciplines
Emerging knowledge, theories, models and conceptual
frameworks.
Increasing acceptance of theory and research by practicing
managers.

Willingness of managers to explore new ideas

More receptive to new models
Support related research
Hungrily experiment with new ideas

Contributing Disciplines to the OB Field

Psychology
Sociology
Social Psychology
Anthropology
Political Science

Contributing Disciplines to the OB Field

Study of the
mental
characteristics or
attitude of a
person or group.

IQ/achievement tests
Attitude tests
Personality tests
Aptitude tests
-verbal reasoning, numerical ability, abstract Reasoning,
clerical speed and accuracy, mechanical reasoning, space
relations, spelling and language usage

These aptitudes are believed to

be related to specific occupations
and are used for career guidance
as well as selection and
recruitment

Contributing Disciplines to the OB Field (contd)

Contributing Disciplines to the OB Field (contd)

Contributing Disciplines to the OB Field (contd)

Maximus Vs. Commodus

Contributing Disciplines to the OB Field (contd)

Toward an OB Discipline

EEXXHHI IBBI ITT

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What is behaviour??
A socially driven purposeful action.
When I am alone there is only communication.
When other person comes there is SENSITISATION.
That is Getting AWARE of other persons presence.
You find yourself putting up an appearance.
Reactive and Proactive.

Stimuli leads Responses

OB Model

A model is abstraction of reality

A simplified version of real world phenomenon

Basic OB Model, Stage I

Model
An abstraction of reality.
A simplified
representation of some
real-world phenomenon.

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The Dependent Variables

Dependent variable
A response that is affected by an independent
variable.

x
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The Dependent Variables (contd)

Productivity
A performance measure that
includes effectiveness and
efficiency.
Effectiveness
Achievement of goals.
Efficiency
The ratio of effective
output to the input
required to achieve it.
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The Dependent Variables (contd)

Absenteeism
The failure to report to
work.

Employees Turnover
The voluntary and
involuntary permanent
withdrawal from an
organization.
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The Dependent Variables (contd)

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

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The Dependent Variables (contd)

Job satisfaction
A general attitude toward ones job, the
difference between the amount of reward
workers receive and the amount they believe
they should receive.

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Basic OB
Model,
Stage II

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Model or Various Approaches of OB

Social Systems and Organizational Culture

A social system is a complex set of human relationships

interacting in many ways.

Within an organization, the social system includes all the
people in it and their relationships to each other and to the
outside world.
The behavior of one member can have an impact, either
directly or indirectly, on the behavior of others.
Also, the social system does not have boundaries...it
exchanges goods, ideas, culture, etc. with the environment
around it.

Culture is the conventional behavior of an organization

that encompasses beliefs, customs, knowledge, and

practices.
It influences human behavior, even though it seldom
enters into their conscious thought.
People depend on culture as it gives them stability,
security, understanding, and the ability to respond to a
given situation.
This is why people fear change.
They fear the system will become unstable, their security
will be lost, they will not understand the new process, and
they will not know how to respond to the new situations.

HOW AN ORGANIZATION's CULTURE CAN BE

KNOWN ?
Organization culture can be a set of key values , assumptions,
understandings and norms that is shared by members of an
organization.
Organization values are fundamental beliefs that an organization
considers to be important , that are relatively stable over time,
and they have an impact on employees behaviors and attitudes.
Organization Norms are shared standards that define what
behaviors are acceptable and desirable within organization.
Shared assumptions are about how things are done
in an organization.
Understandings are coping with internal / external problems
uniformly.

LEVELS OF ORGANIZATION CULTURE

LEVEL 1---VISIBLE, that can be seen at the surface

level
-dress codes
-office layout [ open office]
-symbols
-slogans
-ceremonies[ monthly / annual awards/long
service/birthdays etc.
etc

LEVEL 2- INVISIBLE , that can be cannot be

seen but only felt.

-stories about people performance
-symbols [ flag, trademark, logos, etc]
-corporate mission statements
-recruitment/selection [ methods used]
-fairness in treatment
-social equality
-risk taking in business deals
-formality in approach
-discipline
-autonomy for departments
-responsiveness to communication
-empowerment of staff.

Elements in an OB Model

Limitations of OB
People who lack system understanding and become

superficially infatuated with OB may develop Behavioral

bias narrow viewpoint that emphasized satisfying
employee experiences while overlooking the broader system
of the organization in relation to all its publics.
The law of diminishing return

the tendency for a continuing application of effort or skill toward a

particular project or goal to decline in effectiveness after a certain level
of result has been achieved.
Overemphasis on as valid organizational behavior practice may produce
negative results
At some point increase of a desirable practice produce declining
returns, eventually negative returns

Unethical manipulation of people

Knowledge and techniques can be used to manipulate people

unethically
People who lack ethical values could use people in unethical
ways.
The philosophy of OB is supportive and oriented toward
human resources. Seeks to improve human environment and
help people grow toward their potential.
Ethical leadership principles such as: social responsibility,
open communication, cost-benefit analysis.

Continuing Challenges
Seeking Quick Fixes

Are we tempted when pressured to seed rapid solutions?

Varying Environments

Can the ideas that have been developed and tested endure with
equal success under new conditions?

Definition Confusion

Considered as relatively new discipline, can OB in clearly

define its field of student and application?

The organization is above all social. It is

people.
Peter Drucker