Chapter # 1

Introduction & Background of

Organizational Behavior

What is Management?
A

set of activities (planning, organizing, leading, and controlling) directed at an organizations resources (human, financial, physical, and information) with the aim of achieving organizational goals in an efficient and effective manner. Managers- Individuals who achieve goals through other people using management functions (also called
administrators, especially in non profit organizations).

Managerial Skills

Technical Skills: Job-specific knowledge and techniques. Human Skills: The ability to understand, work with, lead, and control the behavior of other people and groups. Conceptual Skills: The ability to analyze and diagnose a situation and distinguish between cause and effect.

What is an organization?

A group of people working together in a structured and coordinated fashion to achieve a set of goals.

Management in Organizations
Planning and decision making Inputs from the environment Human resources Financial resources Physical resources Information resources Controlling Leading Organizing

Goals attained Efficiently Effectively

Figure 1.1

Management Functions

Organizational Performance

Efficiency: A measure of how well

resources are used to achieve a goal

Doing Things Right

Effectiveness: A measure of the

appropriateness of the goals chosen (are these the right goals?), and the degree to which they are achieved

Doing the Right Things Right

What is Behavior?

Behavior refers to the actions or reactions of an object or organism, usually in relation to the environment. Behavior can be conscious or unconscious, overt or covert, and voluntary or involuntary. Attitude- An attitude is a view of an individual that
represents his degree of like or dislike for a object.

What is Organizational Behavior?

Organizational Behavior (OB) is the study and application of knowledge about how people, individuals, and groups act in organizations and how organizations can manage, predict & improve performances of its employees.

Insert Figure 1.1 here

Enter Organizational Behavior

Intuition: Intuition can be defined as direct perception of truth, fact, etc., independent of any reasoning process. Intellect: capacity for thinking and acquiring knowledge, esp. of a high or complex order; mental capacity.

Contributing Disciplines to the OB Field

Psychology is an academic and applied discipline involving the scientific study of human mental functions and behavior

Formal organization is a fixed set of rules of organization procedures and structures, which are usually set out in writing. Group dynamics is the study of groups, and also a general term for group processes.

EXHIBIT

1-3d

Why is OB Important?
Companies whose managers accurately appraise the work of their subordinates enjoy lower costs and higher productivity. People who are satisfied with the way they are treated on their jobs are more pleasant to work with and less likely to quit. People who are trained to work together tend to be happier and more productive. Employees who believe they have been treated unfairly are more likely to steal and reject the policies of their organizations. People who are mistreated by their supervisors have more mental and physical illnesses than those who are treated with kindness, dignity, and respect. Organizations that offer good employee benefits and have friendly conditions are more profitable than those that are less people oriented.

Challenges and Opportunity for OB

Responding to Globalization Changing Social/ Cultural Environment Managing Workforce Diversity Improving Quality and Productivity Improving Customer Service Empowering People Coping with contingent/downsizing/outsourcing Stimulation Innovation and Change Improving Ethical Behavior Advancing Information Technology

Basic OB Model

Historical Perspective of OB
Scientific management (Taylorism/Taylor system)

Taylor was one of the first to attempt to systematically analyze human behavior at work. Scientific management: the systematic study of relationships between people and tasks for the purpose of redesigning the work process to increase efficiency The amount of and effort each employee expends to produce a unit of output can be reduced by increasing specialization and the division of labor

General approach Develop a standard method for performing each job Select workers with appropriate abilities for each job Train workers in the standard method previously developed Support workers by planning their work and eliminating interruptions. Provide wage incentives to workers for increased output

Which included severe labor/management conflict, apathy, boredom, and wasted human resources

Problems with Scientific Management

Managers
Workers

frequently implemented only the increased output side of Taylors plan.

did not share in the increased output.

Specialized
Workers

jobs became very boring, dull.

ended up distrusting the Scientific Management

method.
Workers

could purposely under-perform.

The Human Relations Movement

The Hawthorne Studies
Hawthorne Works of the Western Electric Company; 1924-1932 Initiated as an attempt to investigate how characteristics of the work setting affect employee fatigue and performance (i.e., lighting) Found that productivity increased regardless of whether illumination was raised or lowered The Hawthorne Effect

The Human Relations Movement

organizations are social systems, not just technical economic systems we are motivated by many needs we are not always logical we are interdependent; our behavior is often shaped by the social context informal work group is a major factor in determining attitudes and performance of individual workers management is only one factor affecting behavior; the informal group often has a stronger impact job roles are more complex than job descriptions would suggest; people act in many ways not covered by job descriptions there is no automatic correlation between individual and organizational needs communication channels cover both logical/economic aspects of an organization and feelings of people teamwork is essential for cooperation and sound technical decisions leadership should be modified to include concepts of human relations job satisfaction will lead to higher job productivity management requires effective social skills, not just technical skills

The Human Relations Movement

Douglas McGregor's Theory X and Theory Y

Douglas McGregor proposed the two different sets of assumptions about workers.
Theory

X assumes the average worker is lazy, dislikes work and will do as little as possible.
Managers must closely supervise and control through reward and punishment.

Theory

Y assumes workers are not lazy, want to do a good job and the job itself will determine if the worker likes the work.

Managers should allow workers greater latitude, and create an organization to stimulate the workers.

TQM MOVEMENT

Originated in the 1950's and has steadily become more popular since the early 1980's

"TQM is a management approach for an organization, centered on quality, based on the participation of all its members and aiming at long-term success through customer satisfaction, and benefits to all members of the organization and to society

TQM: Creating an Organization Dedicated to Continuous Improvement Total Quality Management is a comprehensive
approachled by top managers and supported throughout the organizationdedicated to continuous quality improvement, training and customer satisfaction
Four Components of TQM:
1. 2.

3.
4.

Make Continuous Improvement a Priority Get Every Employee Involved Listen to and Learn from Customers and Employees Use Accurate Standards to Identify and Eliminate Problems

The Contingency Approach

The idea that the organizational structures and control systems manager choose depend on are contingent oncharacteristics of the external environment in which the organization operates.
Assumes

there is no one best way to manage.

The environment impacts the firm and managers must be flexible to react to environmental changes.

In

rapidly changing organizational environments, managers must find ways to coordinate different departments to respond quickly and effectively.