Organisational behavior

Organisational Behaviour is the study of human behavior.

The study is about behavior in organizations.

Knowledge about human behavior would be useful in improving an organisation’s effectiveness.

Definitions “Organisational Behaviour” is the study and application of knowledge about

how people – as individual and as groups – act within organizations.

It is a field of study that investigates the impact that individuals, groups and structure have on behavior within organizations for the purpose of applying such knowledge towards improving an organisation’s effectiveness.

Organisational Behaviour means the study of behavior of individuals, and groups in organizations and organizations themselves, as they act and interact to attain desired outcomes.

Goals of OB To describe – The first objective is to describe – how people behave

under a variety of conditions.

To understand – as to why people behave as they do.

To predict – Predicting future employee behavior is another goal of OB. Managers would have the capacity to predict which employees may be dedicated and productive or which ones might be absent or disruptive on a certain day so that the manager could take preventive actions.

To control – The final goal of OB is to control and develop some human activity at work. Managers also want to make an impact on employee behavior, skill development, team effort and productivity.

Managers should be able to improve the results through their own and their employee’s actions.

Features of Organisational Behaviour

The essential characteristics of organisational behaviour are as follows:(i) An Integral Part of Management. OB is a part of general management

and not the whole of management. It represents behaviour approach to management. It is significant to note that because of the importance of human behaviour in organisations, OB has assumed the status of a distinct field of study.

(ii) A Field of Study. OB is a field of study backed by a body of theory, research and application associated with a growing concern for people at the workplace. Its study helps in understanding the human behaviour in work organizations. It includes creative thinking among the managers to solve human problems in organisations.

(iii) Inter-disciplinary Approach. The field of organisational behaviour is heavily influenced by several other behavioural sciences and social sciences. The prominent among these are psychology, sociology and anthropology. Organisational behaviour draws a rich array of research from these disciplines. What makes it a field in its own right is the attempt to integrate various aspects and levels of behaviour.

(iv) Levels of Analysis. OB involves three levels of analysis of behaviour – individual behaviour, group behaviour and behaviour of the organisation itself. It helps in demolishing ‘incorrect’ assumptions one may hold about behaviour. It provides a rational thinking about people.

(v) Goal-Oriented. OB is an action – oriented and goal-directed discipline. The major goals of organisational behaviour are to understand, explain and predict human behaviour in the organisational context so that it may be moulded into result-yielding situations. It provides a rational thinking about people and their behaviour.

(vi) Human Tool. OB is a human tool for human benefit. It helps in understanding and predicting the behaviour of individuals. It provides generalisations that managers can use to anticipate the effects of certain actions on human behaviour.

(vii) Science and Art. OB is both a science as well as an art. The systematic knowledge about human behaviour is a science. The application of behaviour knowledge and skills clearly leans towards being an art. However, organisation behaviour is not an exact science like physics or chemistry. It cannot provide specific answers to all organisational problems. The exact prediction of behavior of people in organisations is also not possible. It is possible to predict relationships between variables on a broad scale, but it is difficult to apply predictive models in all situations.

(viii) Satisfaction of Employees’ Needs.People may get need satisfaction and the organisation may attain its objectives. Thus, both organisation and individuals can be benefited by each other.

Levels of Analysis of OB

Organisational Behaviour focuses on three levels of analysis, viz.,(i) Individual (ii) Group, and (iii) Organisation.

The performance of individuals, groups (say class or section) and the institute as a whole – are all important and outstanding performance of each individual and group is recognized and highlighted. Behaviour at all three levels is interdependent and interrelated.

PSYCHOLOGY

Individual Level:Personality, PerceptionAttitudes and ValuesIndividual Decision-makingLearningMotivation, Job-satisfaction Social, Cultural and Other FactorsWork Stress

SOCIOLOGY

Group Level :Groups and TeamsLeadershipCommunication Conflict, Dynamics of ChangeFormal and Informal OrganisationStatus and Roles

SOCIAL PSYCHOLOGY

Change in Attitude and BehaviourGroup Processes : NormsCommunicationGroup Decision-making

ANTHROPOLOGY

Organisation System Level :Organisational CultureStress ManagementOrganisational Change and DevelopmentMorale and Productivity Cross-cultural Analysis

INDIVIDUAL

GROUP

ORGANISATION

OrganisationalBehaviour

1.) Behaviour at the Individual Level - Organisations are made up of their individual members. The individual is a central feature of organisational behaviour, whether acting in isolation or as part of a group, in response to expectations of the organisation, or as a result of influence of the external environment.

The behaviour of individuals is a complex phenomenon and is affected by a large number of factors such as personality, attitudes, perception, learning, motivation, social, cultural and other factors. The study of behaviour of an individual working in the organisation is also known as micro-organisational behaviour.

2.) Behaviour at the Group Level - Behaviour pattern of individuals is also influenced by the groups to which they belong. Research studies have shown people behave differently in groups than as individuals. Several factors influence the behaviour of groups such as group goals, norms, communication, leadership, cohesiveness, etc. Understanding of group dynamics is essential to reduce conflicts and improve morale and productivity. Understanding the effect of group relationships is important for managers in today’s organisations. Inter group relationships may be in the form of cooperations or competition. The co-operative relationships help the organisation in achieving its objectives.

3.) Behaviour at the Organisation Level - An organisation is a system composed of several interdependent individuals and groups. Individuals and groups operate within the structure of formal organisation. They particapte in shaping the culture of the organisation and also in organisation development. At times, they may resist change, while they may fight for change in certain situations. Stress caused by the activities of individuals and groups has to be managed at the organisational , group and individual levels. The study of behaviour from the perspective of the whole organisation is also referred to as macro organisational behaviour.

IMPORTANCE OF OB

1) OB helps an individual to understand himself and others better. This will improve interpersonal relations considerably. Attitudes, perception, leaderships, communication, transactional analysis and conflicts can also be understood better with the study of OB.

2) A manager in a business establishment is concerned with getting things done through others. He will be successful in his job when he can motivate his subordinates to work for better results. OB will help the manager understand the basis of motivation and what he should do to motivate his subordinates.

3) The field of OB will be successful in maintaining cordial industrial relations. If an employee is slow in his work, or if his productivity is readily declining, the basic issue may not be demand for more wages, higher bonus, a better canteen etc. This can be due to any other reasons like the indifferent attitude of the boss towards the worker which in turn can lead to the worker loosing interest in his work gradually. Similarly, reluctance of the management to talk to union leaders may provoke them to give a strike. Hence the relations between the management and the employees are often strained for reasons which are personal but not technical.

4) OB helps in the field of marketing. In the dynamic mechanism of the flow of goods and services from producer to consumer, the awareness of the nature of individual and social process has an immediate or long term contribution to the success or the failure of the enterprise.

5) OB helps in predicting the behaviour of individual and thus help the organization to be effective having good ‘people skills’ which includes the ability to understand one’s employees and to use this knowledge to make them work efficiently is a vital requirement if a person has to succeed as a manager.

6) Effective management means competent utilization of technical and financial resources. OB is a discipline which enables a manager to motivate his subordinates towards higher productivity and better results.

Forces Affecting Organizational Behaviour

The four key forces that affects Organization Behaviour

1. People2. Structure3. Technology 4. Environment

1. People- People make up the internal social system of the organization. That system consists of individuals & group & large groups as well as small ones. There are unofficial informal groups & official formal groups. Groups are dynamic in the sense that they form, change & disband.

People work in the organization to achieve their objectives. The workforce of an organization, however is very diverse in terms of their educational backgrounds, talents & perspectives to their jobs. The managements’ leadership practices have to be tuned to the diverse workforce. Some companies have developed a sense of caring, really listening to the employees, developing the competence level of the employees, building pride without devaluing others, empowering some without exploiting others, demonstrating openness, confidence, authentic compassion and vulnerability.

2. Structure - Structure defines the formal relationship and use of people in organization. It defines the roles & relationship of people in an organization. Different jobs are performed by different people in an organization & these people are related to each other in some structural way so as to coordinate their work effectively. The structure defines the authority-responsibility relationship. One has the authority & the others have a duty to obey him. Some organization have resorted to a flatter structure (containing fewer levels, a goal attained by cutting middle management position), other have a complex structure as a result of mergers, acquisitions & new ventures. Some organizations have hired contingent workforces (tempory, part-time or contract employees), some firms have developed a team-based structure.

3. Technology- Technology provides the resources with which people work & affects e task that they perform. The people are given the assistance of machines, methods & resources. Technology allows people to do more & better work but it adds to the cost for examples- Increasing use of robots & automated control systems in assembly lines, the dramatic shift from a manufacturing to a service economy, advances in computer hardware & software capabilities, use of internet & improved quality of goods & services at acceptable prices.

All these technical advancements exerts an increased pressure on OB to maintain a delicate balance b/w technical & social systems.

4. Environment- Organisations are influenced by external environment which include socio-cultural, economic, politico-legal, geographical forces. All organisations operate within an internal & external environment. An organisation is always a part of a larger system with elements like government, the family & other organizations. Any change in the environment creates demands on organizations. Citizens expect organisations to be socially responsible; there are new products & competition for customers. Any organization is influenced by its external environment. It influences the attitudes of people, affects working conditions & provides competition for resources & power.

People

Environment Environment

Structure Technology

Environment

Disciplines contributing to OB

OB is not a discipline in itself but it uses knowledge concepts & principles from the other relevant disciplines. It draws concepts & principles from behavioural. It draws concepts & principles from behavioural sciences & the core disciplines of behavioural sciences are-

1. Psychology 2. Sociology3. Anthropology

OB draws concepts from social sciences also-1. Economics2. History3. Political Science

ORGANISATION

Contributions of core disciplines of behavioural sciences to OB

1. Psychology- The term “psychology comes from the Greek word “psyche” meaning soul or spirit. Psychology is a science of behaviour, the term behaviour. Psychology studies behaviour in various conditions- normal, abnormal, social, industrial, legal, childhood, adolescence, old age etc. It also studies process of human behaviour like learning, thinking, memory, sensation, perception, emotion, feeling & personality.

Its contributions to behavioural science are in the field of learning, perception, motivation, individual & group decision making, pattern of influence, and change in organization group process, vocational choice and satisfaction, communication, personnel selection & training.

There is also a separate branch of industrial psychology which deals with the application of psychological facts & principles to the problem concerning human relations in organization.

2. Sociology – It uses the scientific method in accumulating knowledge about man’s social behaviour. It studies the shared human behaviour, the way in which people act towards one another. It studies social groups, social behaviour, society, customs, institutions, social class, status, social mobility and prestige. Its subfields are-1. Political sociology 2. Industrial sociology3. Family sociology 4. Sociology lf Law5. Educational sociology 6. Sociology of religion

To the managerial practice, its contribution is in the field of bureaucracy, role structures social system theory, grp dynamics effect of industrialsation on the social behaviour etc.

3. Anthropology- “Anthropology” combines the Greek stem ‘anthropo” meaning man & “Logy” meaning science. Hence, Anthropology is the sciences of man. It studies civilization, forms of cultures & their impact on individual & grps, biological factures of man and evolutionary pattern, speech and relationship among languages. Anthropology contributes in understanding the cultural effects on organization behaviour, effects of value systems, norms, sentiments, cohesion and interaction.

OTHER DISCIPLINES

1) ECONOMICS: Economics contributes in understanding the decision process, and methods of allocating scarce resources in organizations and the impact of economic policy on organizations.

2) POLITICAL SCIENCE: It provides the basis for the conflicts in organisation, power and authority structure and overall administrative process.

UNDERSTANDING HUMAN BEHAVIOUR

OB helps to understand human behavior in the organisation – at the individual level, interpersonal level, group level and inter group level.

i) Individual Level: OB helps to understand why and how an individual behaves in a particular way. Human behaviour is a complex phenomenon and is affected by a number of factors like psychological, social, cultural etc. OB integrates these factors in order to understand human behaviour.

ii) Interpersonal Level : Human behaviour has to be understood in terms interpersonal interactions because human beings have a natural tendency to socialize. OB helps to understand relationships in terms of superior subordinates relationships, peer relationships, role analysis, transactional analysis etc.

iii) Group Level: Individuals are times modified by group pressures. Hence it becomes important to study groups and group dynamics with special reference to norms, cohesion, goals, communication pattern, leadership and membership. An understanding of group behaviour is important organizational moral and productivity.

iv) Inter Group Level: Inter group relationships may be in the form cooperation or competition. OB helps to understand and achevie cooperative group relationships through interaction, rotation of members among groups, avoidance of win-loose situation and focuses on total group objectives.

MODELS OF OB

AUTOCRATIC MODEL- In an autocratic model, managerial orientation is towards power. Managers see authority as the only means to get the things done, & employees are expected to follow orders. So there is a high dependence on boss. This dependence is possible: employees live on the subsistence level. The organizational process is formal. The Management decides what is the best

action for the people. The model is largely based on the theory x assumptions of McGregor wherein the human beings are distasteful to work & try to avoid respeonsiblity. A strict supervision is read to obtain a desirable performance from them.

Likert’s Management system can be compared with a model of OB. His system (exploitative authoritative) in which motivation depends on physical security & some use of desire for status & better performance is ensured through jear, threats punishment & occasional rewards; communic” is mostly one. Way. i.e downward. There is little interaction s/w mangers & employees.

The autocratic model represents traditional thinking which is based on the economic concept of the man. However, with changing times, its acceptability is to a limited extent. But t is still a useful way to accomplish performance. Particularly where the employees can be motivated by physiological needs.

This usually happens at lower strata of the organization.

CUSTODIAL MODEL - In this model, the managerial orientation is towards the use of money to pay for employee benefits. The model depends on the economic resources of the organization & its ability to pay for the benefits. The employees are highly dependent on the organization. An organizational dependence reduces personal dependence on boss. The employees are able to satisfy their security needs (Maintenance factors in case of herzberg’s theory). These maintenance factor provide security but do not provide strong motivation the employees working under custodial model feel happy get adequate rewards & organization security but their performance level is not high as are not given any authority to decide what benefits / rewards they should get.

This approach is quite similar to patrimonial approach where the Management decides what benefits are best suited for the employees. Hence not a suitable model for matured employees.

SUPPORTIVE MODEL – This model depends on managerial leadership rather than on the use of power or money. The aim of managers is to support employees in their achievement of results. The focus is on employee participation in managerial decision making process.

The model is based on “Principles of Supportive relationships” of Likert, which is the basic ingredient of his system 4(participative).

It is similar to the assumptions of Mc Gregor’s Theory Y. The supportyive model is based on the assumptions that human beings move to the maturity level and they expect the organizational climate which supports this expectation.

The organizational processes like communication, leacdership, decision making, interaction, control and influence help employees to fulfill their higher order needs like self-actualisation and esteem.

The supportive model is best suited when employees are self motivated. Hence, the focus is not on the economic resources of the organization but its human aspect.

Manager’s role is to help employees achieve their work rather than supervising them closely. This model is specially effective with nations with affluence and complex technology because it caters to higher-order needs and provides intrinsic motivational factors.

It is more suitable for employees at managerial levels rather than on operative levels.

COLLEGIAL MODEL – This model is an extension of supportive model. The term “Collegial” refers to a body of people having a common purpose. It is based on the team concept in which employee develops a high degree of understanding towards others and shares common goals.

“Responsibility” is expected out of the employees. Employees need a little direction and control from the management. Control is through self disciple from the team members.

The collegial model is conducive to self fulfillment & self-actualisation. It can be more beneficial with unprogrammed work requiring behavioural flexibility and intellectual environment and job freedom.

SYSTEM MODEL – It is one of the emerging models of OB. Herein, there is a strong search for a higher meaning at work by the employees; they want more than a pay check & job security from their jobs. They look for a work that is ethical, enfused with integrity & trust and provides an opportunity to experience a growing sense of community among co-workers. To accomplish this, the managers demonstrate caring and a compassionate attitude and are sensitive to the needs of a diverse workforce. The role of a manager is to facilitate employee accomplishments through a variety of actions.

In turn, the employees realize and recognize the mutuality of company-employee obligations in a system model. There is a sense of psychological ownership for the organization and its products / services. The employees take a responsibility for their own goals and actions, hence are self motivated. Hence, the employees needs are higher-order needs (social, status, esteem, autonomy, self-actualisation).

The various models (Autocratic, Custodial, Supportive, Collegial and System Model) of OB are based on the assumption of the human characteristics and how they can work best. They are basically constructed around need hierarchy. As the need hierarchy differs for different people, the same model cannot be used for all of them.

The need hierarchy changes with the level of a person, level of his education, maturity level, personality factors and the type of work environment.

Challenges and Opportunities for OB Responding to Globalisation – Organisations are no longer limited by

national borders. Managers have to be capable enough to work with people across cultures. Being a manager, one needs to manage a workforce which is different in needs, aspirations and attitudes. To work effectively with these people, one needs to understand their culture, how it has shaped them and how can the management style be adapted to suit their differences.

Managing workforce diversity – While globalization focuses on differences between people from different countries, workforce diversity focuses on differences among people with given countries. Workforce diversity means that organizations are heterogenous in terms of gender, race and ethnicity. The challenge for organizations, thus, is to make themselves more accommodating to diverse groups of people by focusing on their different lifestyles, family needs and workstyles, while at the same time not discriminating. This involves providing diversity training, and revamping benefit programs to accommodate the different needs of different employees. Diversity, if properly managed, can increase creativity and innovation in organizations as well as improve decision making by providing different perspectives on problems. If diversity is not properly managed, it leads to a higher turnover, more difficult communication and more interpersonal conflicts.

Improving Quality and Productivity – The managers often confront challenges to improve their organization’s productivity and the quality of products and services they offer. For this, they often have to implement programs of Quality management and Process Reengineering.

Quality Management – (i) Constant attainment of customer satisfaction through the continuous improvement of all organizational processes.

(ii) Improvement in the quality of everything that the organization does – how the organization handles deliveries, how rapidly it responds to complaints etc.(iii) Accurate measurement – Quality Management uses statistical techniques to measure the performance variables and then compare them with the standards / benchmarks.(iv) Empowerment of employees – Quality management involves the people in the improvement process. Teams are used in QM programs as empowerment vehicles for finding and solving problems.Process Reengineering – helps managers to reconsider how work would be done and the organization restructured if they were starting over from the scratch.

Responding to the labour shortage – Economic ups and downs are difficult to predict. In 1990s, the labour markets were tight as the world economy was robust. It was difficult to fill vacancies with skilled workers. In 2001, there was an economic recession – lot of layoffs took place and hence the skilled workers were in plenty.

It is also predicted that there will be a labour shortage for atleast 10-15 years. In the latter part of the 20th century, there was a huge increase in the number of women entering the workforce which was a new supply of talented and skilled workforce. Also, the older workforce seem to be less interested to work which can be attributed to improved pension plans, expanded social security benefits and a healthy stock market.During labour shortage, good wages and benefits are not the only means to get and keep skilled employees. Newer recruitment and retention strategies have to be developed with the help of OB. Improving customer service – OB can contribute to improving an organisation’s by showing managers how employee attitudes and behavior are associated with customer satisfaction.

The management should focus on creating a customer – responsive culture – a culture in which employees are friendly and courteous, accessible, knowledgeable, prompt in responding to customer needs and willing to do what’s necessary to please the customer. Improving people skills – Techniques should be developed to design

motivating jobs, to improve upon the listening skills and to create effective teams.

Empowering people – There has been a complete change in the relationship between managers and the employees. Decision making now happens at the operating level. Employees have started having a full control of their work. There is also a concept of self-managed teams wherein workers operate largely without bosses. By empowering employees, managers are learning how to give up control, and employees

know how to take responsibility for their work and make appropriate decisions.

Coping with “Temporariness” – Unlike yesteryears, “managing” today includes long periods of ongoing change, interrupted occasionally by short periods of stability. The workers need to update their knowledge and skills continually to perform new job requirements. Work groups are also in a state of flux. Earlier, employees were assigned to a specific work group which was permanent. So there was security in working with the same people. But now, work groups are temporary wherein members are from different departments and members keep changing and employee rotation is practiced to fill constantly changing work assignments.

Organisations also continuously reorganize their divisions, sell-off poor performing businesses, subcontract non-critical services and operations to other organisations and replace permanent employees with temporary workers.The managers and employees should know to cope with temporariness, to live with flexibility, spontaneity and unpredictability.

Stimulating Innovation and Change – The organizations should foster innovation, continuously improve their quality in order to beat competition. Example, The services of Dominos has brought an end to a number of pizza parlours in the city. The challenge for managers is to stimulate the employees’ creativity.

Helping employees balance work / life conflicts – The line between the work and non work time of employees has become blurred, creating personal conflicts and stress. This can be due to the following reasons –

Creation of global organizations – Employees are required to work 24*7.

Communication technology – People do their work from any place at any time.

Longer hours put in by the employees.

Dual-career couples – as a result married couples have lesser time to fulfill commitments back home.

So, managers should help in making their workplace and jobs such that it helps the employee deal with work / life conflicts.

Improving ethical behavior – Employees at times, face ethical dilemmas i.e. situations in which individuals are required to define right and wrong conduct. For example, Should they follow orders with which they don’t

personally agree? Should they uncover illegal activities taking place in the company?

Managers and organizations are trying to tackle this problem by – o Writing and distributing codes of ethics to guide the employees.

o Seminars, workshops, similar training programs to try and improve ethical behavior.

o Provision for an in-house advisor who can be contacted (anonymously) for assistance in dealing with an ethical issue. Also, they provide with protection mechanisms for employees who reveal internal unethical practices.

Limitations of OB

Behavioural bias – Behavioral bias gives a narrow viewpoint to the employees that emphasizes satisfying employee experiences while overlooking the broader system of the organization. It is more like a tunnel vision in which people have narrow viewpoints as if they were looking through a tunnel. The concern for employees can be so greatly overdone that the original purpose of bringing people together- productive organizational outputs is lost. It is wrong to assume that the objective of OB is simply to create a satisfied workforce without worrying about customer service and productivity. Equally, if a person is continuously concerned with production outputs without regard for employee needs is misapplying OB.

Behavioural bias can harm the employees as well as the organizations.Too much of care can make the employees dependent and unproductive. They may find excuses for failure and avoid taking responsibility for progress. They lack self discipline and self respect.

The Law of Diminshing Returns – The Law of diminishing Returns is a limiting factor in OB as in Economics which produces negative results. In OB, this law states that at some point, increases of a desirable practice produce declining returns, eventually zero returns, and then negative returns asmore increases are added. For any situation, there is an optimum amount of a desirable practice, such as recognition or participation. When that point is exceeded, there is a decline in returns. For example, too much security may lead to less employee initiate and growth.

Hence, organizational effectiveness is achieved not by maximizing one human variable but by working all system variables together in a balanced way.

Unethical manipulation of people – The knowledge and techniques of OB are at times used to manipulate people unethically as well as to help them develop their potential. People who lack respect for the basic dignity of the human being could use OB for selfish ends and use people in unethical ways.