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UNIT I
INTRODUCTION TO ORGANISATIONAL BEHAVIOUR

LESSON – 1
IMPORTANCE OF ORGANISATIONAL BEHAVIOUR

Contents
1.0 Aims and Objectives
1.1 Introduction
1.2 Organization behaviour – concepts
1.2.1 Organisation
1.2.2 Management
1.3 Key elements of organisational behaviour
1.3.1 People
1.3.2 Structure
1.3.3 Mechanics form of organization
1.3.4 Organic form of organization
1.3.5 Jobs and tasks
1.3.6 Technology
1.3.7 Environment
1.4 Basic approaches to organisational behaviour
1.5 Let us Sum up
1.6 Lesson-end Activities
1.7 References

1.0 AIMS AND OBJECTIVES

After studying this lesson, the students are able to :

i) Understand the concepts of organizational behavior and its application in
managing people
ii) Apply the different approaches to organizational behavior and enhance the
human relationships within the organization.
iii) Explore the relationships among the various components of organizational
behavior and their effectiveness.

1.1 INTRODUCTION

Organizations are social systems. If one wishes to work in them or to manage them, it is
necessary to understand how they operate. Organizations combine science and people –
technology and humanity. Unless we have qualified people to design and implement,
techniques alone will not produce desirable results. Human behavior in organizations is
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rather unpredictable. It is unpredictable because it arises from people’s deep-seated needs

and value systems. However, it can be partially understood in terms of the framework of
behavioral science, management and other disciplines. There is no idealistic solution to
organizational problems. All that can be done is to increase our understanding and skills
so that human relations at work can be enhanced

1.2 ORGNISATION BEHAVIOUR - CONCEPTS

Organizational Behavior is field of study that investigates the impact that individuals,
groups and structure have on behavior within organization. It is the study and application
of knowledge about how people act within organizations. It is a human tool for human
benefit. It applies broadly to the behavior of people in all types of organizations, such as
business, government, schools and services organizations. It covers three determinants of
behavior in organizations: individuals, groups, and structure. OB is an applied field. It
applies the knowledge gained about individuals, and the effect of structure on behavior,
in order to make organizations work more effectively. OB covers the core topics of
motivation, leadership behavior and power, interpersonal communication, group structure
and process, learning, attitude development and perception, change process, conflict, job
design and work stress.
Before studying organizational behavior, it is desirable to know the meanings of
organization and management.

1.2.1 Organization
Organization as a purposeful system with several subsystems where individuals and
activities are organized to achieve certain predetermined goals through division of labor
and coordination of activities. Division of labor refers to how the work is divided among
the employees and coordination refers to how all the various activities performed by the
individuals are integrated or brought together to accomplish the goals of the organization.
The term organizing is used to denote one aspect of the managerial activities when he or
she is preparing and scheduling the different tasks that need to be completed for the job to
be done.

1.2.2 Management
It refers to the functional process of accomplishing the goals of the organization through
the help of others. A manager is an individual who is given the responsibility for
achieving the goals assigned to him or her as part of the overall goals of the organization
and who is expected to get the job done. The terms o f top management, lower
management are frequently used to indicate the hierarchical levels of those who are
engaged in the process of getting the goals of the organization accomplished.

1.3 Key Elements of Organisational Behavior

The key elements in organizational behavior are people, structure, technology and the
external elements in which the organization operates. When people join together in an
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organization to accomplish an objective, some kind of infrastructure is required. People

also use technology to help get the job done, so there is an interaction of people, structure
and technology. In addition, these elements are influenced by the external environment,
and they influence it. Each o f the four elements o f organizational behavior will be
considered briefly.

1.3.1 People
People make up the internal social system of the organization. They consist of individuals
and groups, and large groups as well as small ones. People are the living, thinking,
feelings beings who created the organizations. It exists to achieve their objectives.
Organizations exist to serve people. People do not exist to serve organizations. The work
force is one of t h e critical resources t hat need to be managed. In managing human
resources, managers have to deal with:
i) Individual employee who are expected to perform the tasks allotted to them
ii) Dyadic relationships such as superior-subordinate interactions
iii) Groups who work as teams and have the responsibility for getting the job
done,
iv) People out side the organization system such as customers and government
officials

1.3.2 Structure
Structure defines the official relationships of people in organizations. Different jobs are
required to accomplish all of an organization’s activities. There are managers and
employees, accountants and assemblers. These people have to be related in some
structural way so that their work can be effective. 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.

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 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
d) Specialization: This refers to the number of specialities performed within the
organization.
e) Standardization: It refers to the existence of procedures for regularly recurring
events or activities
f) Formalization: This refers to the extent to which rules, procedures, and
communications are written down
g) Centralization: This refers to the concentration of authority to make decision.
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h) Complexity: This refers to both vertical differentiation and horizontal

differentiation. Vertical differentiation: outlines number of hierarchical levels;
horizontal differentiation highlights the number of units within the organization
(e.g departments, divisions)

Organizations can be structured as relatively rigid, formalized systems or as relatively

loose, flexible systems. Thus the structure of the organizations can range on a continuum
of high rigidity to high flexibility. There are two broad categories of organization: i)
Mechanistic form of organization ii) Organic form of Organization

1.3.3 Mechanistic form of Organisation

It is characterized by high levels of complexity, formalization and centralization. A

highly mechanistic system is characterized by centralized decision making at the top, a
rigid hierarchy of authority, well but narrowly defined job responsibilities especially at
lower levels, and extensive rules and regulations which are explicitly make known to
employees through written documents. In mechanistic organization, labor is divided and
subdivided into many highly specialized tasks (high complexity), workers are granted
limited discretion in performing theirs t a sks and rules and procedures are carefully
defined (high formalization); and there is limited participation in decision making which
tends to be conducted at the highest levels of management high centralization.

1.3.4 Organic form of Organisation

A highly organic system is characterized by decentralized decision- making which allows
people directly involved with the job to make their own decisions, very few levels in the
hierarchy with flexible authority and reporting patters, loosely defined job responsibilities
for members, and very few written rules and regulations. It is relatively simple, informal
and decentralized. Compared with mechanistic organizations, employees in organic
organizations, such as design firms or research labs, tend to be more generalist in their
orientation.

1.3.5 Jobs and Tasks

Job refers to the sum total of an individual’s assignment at the workplace. Tasks refer to
the various activities that need to be performed to get the job done. The nature of tasks,
it’s executives by various individuals, nature of interdependence and inter-relatedness,
group activities etc have implication for organizational effectiveness. Thus the jobs and
tasks have to be designed and managed properly.

Core Job Characteristics: There are five job characteristics which are central to
providing potential motivation to workers. They are: Skill variety, Task identity, Task
significance, Autonomy, and Feedback from the job itself.
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i) Task Variety: This denotes the extent to which any particularly job utilizes a
range of skills, abilities and talents of the employees. If number of different skills
is used by the employee on the job, the job is going to provide challenge and
growth experience to the workers.

ii) Task Identity: This indicates the extent to which the job involves a ‘whole’
and identifiable piece of work. If the job involves the whole components (eg
– painting a portrait), then the individual can identify with the ultimate
creation turned out by him and derive pride and satisfaction from having done
a good job.
iii) Task significance: This refers to the meaningfulness or significance of the
impact that a job has on the lives of others – both inside and outsider of the
organization. If what one does has an impact on the well being of others, the
job becomes psychologically rewarding to he person who performs it.
iv) Autonomy: This refers to the extent to which the job provides an
employee the freedom, independent and discretion to schedule work and make
decision and formulate the procedures to get the job done without interference
from others. The greater the degree of autonomy, the more the person doing
the job feels in control.
v) Feedback from the Job itself: This indicates the extent to which the
person who is working on the job can assess whether they are doing things
right or wrong even as they are performing the job. That is, the job itself is
stimulating one and enjoyable.

Job Design: Jobs can be designed to range from highly simple to highly complex tasks in
terms of the use of the workers skill. Some of the job design options are as follows:

i) Job Simplification: The jobs are broken down into very small parts as in
the assembly line operations where a fragmented task is repeatedly done
over and over again by the same individual.
ii) Job Rotation: This involves moving employees among different tasks
over a period of time. Management does not have to bother with
combining tasks, but at the same time, the workers do not get bored with
doing one simple task over several years. The employee is periodically
rotated from one job to another within the work setting
iii) Job Enlargement: This involves simply adding more tasks to the job so
that the workers have a variety of simple tasks to perform rather than
doing just one task repetitively. Two or more tasks are combined and the
individual does the combined tasks altogether.
iv) Job Enrichment: This offers a greater challenge to the workers because it
requires the use of variety of skills possessed by them. This involves
building in motivating factors into the job, giving the workers more
responsibility and control over work, and offering learning opportunities
for the individual on the job.
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1.3.6 Technology
Organizations have technologies for transforming inputs and outputs. These technologies
consist of physical objects, activities and process, knowledge, all of which are brought to
bear on raw materials labor and capital inputs during a transformation process. The core
technology is that set of productive components most directly associated with the
transformation process, for example, production or assembly line in manufacturing firm.

Technology provides the physical and economic resources with which people work. They
cannot accomplish much with their bare hands, so they build buildings, design machines,
create work processes and assemble resources. The technology that results has a
significant influence on working relationships. An assembly line is not the same as a
research laboratory, and a steel mill does not h ave the same working conditions as a
hospital. The great benefit of technology is that it allows people to do more and better
work, but it also restricts people in various ways. It has costs as well as benefits.

Classification of Technology:
Thomson classified technology into three categories: Long-linked technology, Mediating
Technology and Intensive Technology.

i) Long linked Technology: In this, tasks are broken into a number of

sequential and interdependent steps, where the outputs of one unit become the
input of the next. (eg. Assembly line) this facilitates to have high volume of
output and efficiency. This technology calls for mechanistic structures with
high levels of specialization, standardization and formalization.

ii) Mediating Technology: This links different parties who need to be brought
together in a direct or indirect way (eg. Banks – use mediating technology to
lend money to borrowers by taking money from depositors)

iii) Intensive Technology: It is used when a group of specialists are brought

together to solve complex problems using a variety of technologies (eg.
Hospital – parties are treated with the help of experts drawn from different
fields of specialization). Coordination of the different activities is achieved in
the system primarily through mutual adjustment among those engaged in
solving the problem in the different units. Organic structures would fit in this
system using intensive technology.

1.3.7 Environment

All organizations operate within an external environment. A single organization does not
exist alone. It is part of a larger system that contains thousand of other elements. All these
mutually influence each other in a complex system that becomes the life style of the
people. Individual organization, such as a factory or school cannot escape from being
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influenced by this external environment. It influences the attitudes of people, affects

working conditions, and provides competition for resources and power.

Every organization interacts with other members of its environment. The interactions
allow the organization t o acquire r a w material, hire employees, secure capital, obtain
knowledge, and build, lease or buy facilities and equipment. Since the organization
process a product or service for consumption by the environment, it will also interact
with its customers. Other environmental action s , w h o regulate or over see these
exchanges, interact with the organization as well (distributors, advertising agencies, trade
associations, government of the countries in which business is conducted)

Two Distinct Sets of Environment:

i) Specific Environment: This includes the suppliers, customers, competitors,
governments’ agencies, employees, unions, political parties etc.

ii) General Environment: It includes the economic, political, cultural,

technological and social factors in which the organization embedded.

Organizations are embedded in an environment within which they operate. Some of the
external factors may be completely beyond the control of the organization to change,
such as the cultural, social or economic, or governmental aspects. However, many of the
other factors such as sizing up the market, being in tune with the technological changes
takes place, being a step ahead of competition, or stocking up and buffering supplies
when certain materials are likely to be in short supply, are all within the control of the
organization. Effectively managing these situations, however, requires constant and close
vigilance, adaptability to changes, and being able to manage problematical situations
through good decisions making. Those organizations which are proactive (that is,
watchful and take action before crisis situations occur) and can manage their external
environment are more effective than those that are reactive (that is, caught off guard and
wake up after facing the crises situation) and are unable to cope effectively.

Fit between Environment and Structure: Firms facing a fast changing or turbulent
external environment were very effective when they had more organic structures which
provided flexibility for quick changes to be make within the internal environment of the
system. Similarly, firms which operated in a relatively stable external environment were
very effective when they had more mechanistic structures. This mechanistic structure
allowed the system to operate in a predictable manner since authority, responsibility,
procedures, and rules were clearly specified.

1.4 Basic Approaches of Organisational Behavior

i) An Interdisciplinary Approach: It is integrating many disciplines. It integrates

social sciences and other disciplines that can contribute to the Organizational
Behavior. It draws from these disciplines any ideas that will improve the
relationships between people and organization. Its interdisciplinary nature is
similar to that of medicine, which applies physical, biological and social science
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into a workable medical practice. Organizations must have people, and people
working toward goals must have organizations, so it is desirable to treat the two
as a working unit.

ii) Scientific Management Approach: The fundamental concern of the scientific

management school was to increase the efficiency of the worker basically through
good job design and appropriate training of the workers. Taylor is the father of the
scientific management movement and he developed many ides to increase
organizational efficiency. Taylor showed that through proper job design, worker
selection, employee training and incentives, productivity can be increased. The
scientific management school advocated that efficiency can be attainted by
finding the right methods to get the job done, through specialization on the job, by
planning and scheduling, by using standard operating mechanisms, establishing
standard times to do the job, by proper selection and training of personnel and
through wage incentives.

iii) A Human Resources (Supportive) Approach: It is developmental approach

concerned with the growth and development of people toward higher levels of
competency creativity and fulfillment, because people are the central resource in
any organizations and any society. It helps people grow in self-control and
responsibility and then it tries to create a climate in which all employees may
contribute to the limits of their improved abilities. It is assumed that expanded
capabilities and opportunities for people will lead directly to improvements in
operating effectiveness. Work satisfaction will be a direct result when employees
make fuller use of their capabilities. Essentially, the human resources approach
means that better people achieve better results.

iv) A Contingency Approach: Traditional management relies on one basic principle

– there is one best way of managing things and these things can be applied across
the board in all the instances. The situational effect will be totally ignored in this
traditional management. Situations are much more complex than first perceived
and the different variables may require different behavior which means that
different environments required different behavior for effectiveness. Each
situation much be analyzed carefully to determine the significant variables that
exist in order to establish the kinds of practices that will be more effective.

Contingency theorist argues that the external environment and several aspects of
the internal environment govern the structure of the organization and the process
of management. Effective management will vary in different situations depending
on the individual and groups in the organization, the nature of jobs, technology,
the type of environment facing the organization and its structure. For example, if
the employees are highly matured and willing to take more responsibility, the
managers can follow delegating style and give full freedom to their employees. If
the employees are not so matured and avoid taking any responsibility, the
managers must follow directing style. Depends upon the situation, that is,
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employees level of maturity, managers will adopt different style of leadership to

ensure more successful results.

v) A Systems Approach: This implies that organization consists of many inter

related and inter dependent elements affecting one another in order to achieve the
overall results. Conceptually a system implies that there are a multitude of
variables in organization and that each of them affects all the others in complex
relationships. An event that appears to affect one individual or one department
actually may have significant influences elsewhere in the organization.
Systems theorists describe the organization as “open to its external environment”,
receiving certain inputs from the environment such as human resources, raw
materials etc, and engaging in various operations to transform those raw materials
into a finished products and finally turning out the “outputs” in its final form to be
sent to the environment. The organization, since it is open to the environment,
also receives feedback from the environment and takes corrective action as
necessary. This input-transformation process-output model with the feedback
mechanism can be illustrated through a simple example.

1.5 Let Us Sum Up

In this unit, we have briefly discussed about the concepts and key elements of
organizational behaviour. The key elements in organizational behavior are people,
structure, technology and the external elements, in which the organization operators,
various approaches have been developed for managerial analysis. We have also discussed
the five major approaches to organizational behaviour.

1.6 Lesson-End Activities

1. What are the key elements of organization and its dynamics?

2. Describe the two types of environment and its relations with other structural
components.
3. Explain the various types of job design options and its relevance for motivation.
4. Discuss the effect of technology on other key components organization particular, its
structure, people and nature of tasks.
5. What are the basic approaches to study organization behavior?

1.7 References