ORGANIZATIONAL BEHAVIOR

(MBA-711)

Major Ref: Stephen P. Robbins & Timothy A. Judge Organizational Behaviour,

Fifteenth Eds., 2013
Brain Storming Questions
Why do some people do well in organizational
settings while others have difficulty?
Do you know what a “typical” organization looks
like?
Does job satisfaction really make a difference?
Are you ready to assume more responsibility at
work?
What people-related challenges have you noticed in
the workplace?
Why should you care about understanding other
people?
SOME INSPIRING CLICKS ABOUT ORGANIZATIONAL
BEHAVIOUR
 Chapter One
Nature of Organizational Behavior
An organization is a consciously coordinated social
system or collection of people working together to
achieve a common goal or set of goals.

Human behavior is the way in which a person

behaves in response to a particular situation.
Definition of OB
 Robbins and Judge define “Organizational behavior
as a systematic study of the actions and attitudes
that people exhibit within organizations.”

Organizational behavior (OB) is the study of how

people behave in organizations as individuals and as
teams and, how organizations structure human
resources (their employees and managers) to achieve
their goals. (Nahavandi and Melekzadeh)
 .

 What does it study? It studies three determinants

of behavior in organizations:

Groups Structure
Individuals

 Generally, OB is concerned with the study of what

people do in an organization and how that
behavior affects the performance of the
organization.
There are two broad categories of organization:
 i) Mechanistic form of organization
ii) Organic form of Organization
Mechanistic form of Organization
It is characterized by high levels of complexity,
formalization and centralization.
It has a rigid hierarchy of authority and narrowly
defined job responsibilities especially at lower
levels,
It has extensive rules and regulations which are
explicitly made known to employees through
written documents.
Organic form of Organization

A highly organic system is characterized by

decentralized decision-making which allows people
directly involved with the job to make their own
decisions.
Flexible authority and reporting patterns,
Loosely defined job responsibilities for members, and
Very few written rules and regulations.
 Importance of Organizational Behaviour

It helps to understand people in the organizations

 It provides practitioners and managers with the tools
to manage people more effectively, and help
organizations achieve their goals.
It helps to manage individual differences to achieve
performance
It helps to motivate employees and manage teams
Major characteristics of Organization behavior
Interdisciplinary. Organizational behavior is
interdisciplinary orientation that integrates behavioral
sciences in understanding behavior and performance.
It draws heavily on knowledge about behavior
generated in the social sciences of psychology, sociology,
political science and anthropology.

Scientific Method Foundation. OB uses scientific

methods to develop and empirically test generalizations
about behavior in organizations.
Contingency Orientation/ Contingency
Thinking: OB recognizes that management
practices must be tailored to fit the exact nature of
each situation. Accordingly, it dictates that there is
no “best” or “ universal ” way to manage people
OB has three levels of performance analyses
The first level of analysis, called micro OB, studies the
individual. It is the smallest possible level of analysis in
organizations and includes topics such as perception,
personality, motivation, and learning.

The second and middle level of analysis in OB is the

small group level that is made up of individual
employees within an organization.
 The study of small groups in OB includes issues of group
size and composition, cohesion, trust, conflict management,
team building, group decision making, and leadership.

The third level of analysis in OB, called macro OB, is

concerned with larger groups, such as departments, and
organizational processes.

Macro OB topics include issues such as the design and

structure of organizations, organizational culture and
strategy, organizational power, change and organizational
effectiveness.
.

 Managers must understand their organization at

all three levels of analysis to meet the daily
challenges they face.
The three levels of analysis are not mutually
exclusive.
Why Study Organizational Behavior?
 To provide valuable information for organizations
today.
 To manage human resources, improve quality,
and maintain high performance work systems.
 To create and shape successful organizations.
 To understand how other competent
organizations are working.
Disciplines that contributed to OB Theory
OB is a blended discipline that has grown out of
contributions from numerous earlier fields of study.
The predominant areas are:
1. Psychology
2. Sociology
3. Political science
4. Anthropology
Psychology
• It attempts to explain human behavior in a
particular situation and predicts actions of
individuals.
• Psychology is the science that seeks to measure,
explain and sometimes change the behavior of
humans.
• Psychologists have been able to modify individual
behaviour largely with the help of various studies.
Sociology
While psychologists use to focus on the individual,
sociologists study the social system in which
individuals fill their roles.

Specifically, sociologists have made their greatest

contribution to OB through their study of group
behavior in organizations, particularly in formal and
complex organizations.
Some of the areas within OB that have received
valuable input from sociologists are:

Group Design of work Organizational

dynamics teams culture

Formal
Communications organization
theory and
structure
Political Science
 Various government rules and regulations play a very
decisive role in the growth of the organization.

Stability of government at national level is one major

factor for promotion of international business,
financial investments, expansion and employment.
• Political science studies the behavior of individuals
and groups within a political environment.

• Specific topics of concern include

structuring of conflict, allocation of
power, and how people manipulate
power for individual self-interest.
 Anthropology
It is a field of study relating to human activities
in various cultural and environmental
frameworks.
It helps understand difference in behavior based
on value system of different cultures of various
countries.
The study is more pertinent to organizational
behavior today due to globalization, mergers and
acquisitions of various industries.
Opportunities and Challenges for OB
Responding to Globalization:-
 Two or three decades ago, national borders acted
to insulate/isolate most firms from foreign
competitive pressures.

This time organizations are no longer constrained

by national borders.
Example: Chinese global market and multinational
corporations
o E.g. Burger King is owned by a British firm, and
McDonald’s sells burgers in Moscow.
o Exxon, an American company, receives almost 75
percent of its revenues from sales outside the
United States.

In turn, managers have to become capable of

working with people from different cultures.
.

One of the most important and broad-based

challenges currently facing organizations is
adapting to people who are different.
• The term we use for describing this challenge is
workforce diversity.

Workforce diversity means that

organizations are becoming
more heterogeneous in terms of
gender, race, and ethnicity.
 Implications of Workforce Diversity for
Management Practice
Managers will need to shift their philosophy from
treating everyone alike to recognizing differences.

Responding to those differences in ways that will

ensure employee retention and greater
productivity
An important watchword in the twenty-first century is
workforce diversity, the presence of differences
based on gender, race and ethnicity, age, and able
bodiedness.

Success in the new workplace requires a set of skills for

working successfully with a broad mix of people from
different racial and ethnic backgrounds, of different
ages and genders, and of different domestic and
national cultures.
A glass ceiling effect acts as a hidden barrier
limiting the career advancement of minorities and
women in some situations.
For example, the percentage of African-American,
Hispanic, Asian, and female employees has
steadily increased through the 2000s as the U.S.
labor force has also increased in size.
However, they are still underrepresented and paid
less than comparable white male employees who
still comprise the largest group of U.S. employees
Therefore, valuing diversity is an OB theme.
Diversity, if positively managed, can increase
creativity and innovation in organizations

When diversity is not managed properly, there is

communication problem, and more interpersonal
conflict.
Ex. Current scenario at home
Key Elements of Organizational Behavior

The key elements in organizational behavior are

people, structure, technology and the environment
in which the organization operates.

Hence, the interaction of people, structure ,

technology and the external context help the job
get done.
 1. PEOPLE
• People make up the internal social system of the
organization.
They consist of individuals and groups
People are the living, thinking and feeling beings who
create the organizations.
Organizations exist to serve people. People do not
exist to serve organizations.
Today, OB emphasizes on intellectual capital as
represented by the sum total of knowledge,
expertise and dedication of an organization’s
workforce.

It recognizes that even in the age of high

technology, people are the most indispensable
resources whose knowledge and performance
advance the organization’s purpose, mission, and
strategies.
2. STRUCTURE
Structure defines the official relationships of
people in organizations.
The main structure relates to power and to duties.
For example, one person has authority to make
decisions that affect the work of other people.
An organization may have several levels and
pyramid like organizational structure or flat
structure.
 Examples: USA and Japan
Some of the key concepts of organization
structure are listed as below:

a) Hierarchy of Authority: This refers to the

distribution of authority among organizational
positions and authority grants the position holder
certain rights including right to give direction to
others and the right to punish and reward.
b) Division of Labor: This refers to the
distribution of responsibilities and the way in
which activities are divided up and assigned to
different members of the organization, and it is
considered to be an element of the social
structure.

c) Span of Control: This refers to the total

number of subordinates over whom a manager has
authority
3. TECHNOLOGY
Organizations have technologies for transforming
inputs and outputs.
The great benefit of technology is that it allows people
to do more and better work, but it also restricts people
in various ways.
4. ENVIRONMENT
A single organization does not exist alone. It is part of
a larger system that contains thousands of other
elements.
All these mutually influence each other in a complex
system that becomes the life style of the people.
Organizational Changes
These days, change is an ongoing activity
everywhere.
Managers need to introduce major change
programs.

• The concept of continuous improvement, for

instance, implies constant change.

• Employees have to learn to live with flexibility,

spontaneity, and unpredictability.
Stimulating Innovation and Change
• Today’s successful organizations must foster
innovation and master the art of change, otherwise
they will become candidates for extinction.

Victory will go to those organizations that

maintain their flexibility, continually improve their
quality and beat competitions in the market place
with a constant stream of innovative products and
services.
.

Thank You
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