PRINCIPLES AND PRACTICES OF MANAGEMENT

UNIT 5 ORGANIZATIONAL BEHAVIOR

Objectives
After going through this unit, you will be able to:

• Define the basic concept of Organizational Behavior.

• Explain how this concept developed and is useful to managing organizations.
• Enumerate different concepts and tools used to analyze individual behavior for the
organizational culture and its benefits.

Structure

5.1 Introduction
5.2 Definition of Organizational Behavior
5.3 Historical Review
5.4 The Hawthorne Studies
5.5 Personality
5.6 Attitude
5.7 Power and Political behavior within the organization
5.8 Organizational Culture
5.9 Team works and groups
5.10 Job Design
5.11 Interdisciplinary application to organizational behavior
5.12 Keywords
5.13 Summary

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5.1 INTRODUCTION

Industry of any type, organized and unorganized sector are always concerned with people,
human being. Therefore human behavior is considered as a key stone element, for working
efficiency. This factor is related to individuals, group of people, working together in teams. This
study is more challenging and interacts as per the situational factors. The study of organizational
behavior relates to the expected behavior of an individual, within the organization. No two
individuals are likely to behave in the same manner, in a particular work situation. It is the
predictability of a manager about the expected behavior of an individual.

Organizational behavior is involved with the study and application of the human side of
management and organization. Nirmal Singh has put up words of Sam Walton, the richest
businessman and founder of Wal-Mart stores, “People are the key to successful organization
and management”. The traditional resource based organization of the past is rapidly changing to
the emerging trend into knowledge based organization. He has identified, golden triangle that
will dominate this global economy, in this decade. Countries those comes as golden triangle are:

1. The trade regions of North America, i.e. United States, Canada and Mexico;
2. The Pacific Rim – Japan, South Korea, Hong Kong, Singapore, Taiwan;
3. The European Union – Western, Central and Eastern European countries.

Due to this paradigm shift organization need to face new aspects like downsizing, knowledge
and information explosion, global competition and quality management that makes necessary
to look for fundamental shift in management philosophy and practice. In this situation human
factor has received vital importance, as it is a contributor to the productivity hence study of
human behavior has become necessary.

In an organization manager need to handle a group of individual working with or under him.
Therefore he should be able to explain, predict, evaluate and modify human behavior, will
largely depend upon knowledge, skill and experience of the manager to handle large group of
people in diverse situations. Emotional intelligence, organizational culture, job design and the
work environment are the determining factors of human behavior. For today’s and tomorrow’s
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organizations and management there are new rules with different boundaries requiring new
and different behavior. Always there is considerable resistance to change and therefore it is
very difficult to move from the old management paradigm to the new.

5.2 ORGANIZATIONAL BEHAVIOR DEFINITION

Keith Davis defined this concept as -

“Organizational behavior is the study and application at knowledge about the how people - as
individuals and a groups - act within organization. It strives to identify ways in which people can
act more effectively."
Fred Luthans explained it as -

"Organizational behavior can be defined as the understanding; prediction and management of

the human behavior affect the performance of the organizations”.

In the words of Stephen Robbins -

"Organizational behavior is a field of study that, investigates the impact that individuals, groups
and structure have on behavior within organization for the purpose of applying such knowledge
toward improving an organization's effectiveness."

These definitions have three main elements:

First, organizational behavior is an investigative study of individuals and groups.

Second, the impact of organizational structure on human behavior

Third, the application of knowledge to achieve organizational effectiveness

5.3 HISTORICAL REVIEW OF ORGANIZATIONAL BEHAVIOR

Industrial revolution – Industrial revolution has brought materialism, discipline, job

displacement, impersonality, work interdependence and related Behavioral phenomena. Thus it
is a base of all potential improvement. This knowledge up gradation gave workers increased

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wages, shorter hours and more work satisfaction. This evolution starts in 1800, with Welsh
factory owner, Robert Owen, who is treated as Father of Personnel management and some
Behavioral aspects within the organization. He was the first to emphasis the human needs of
employees and therefore refused to employ young children.

Then in 1935, Andrew Ure published a book, “The Philosophy of Manufacturer”, in which he
stated that human factors are one of the factors of production, besides the mechanical and
commercial parts. Ure provided workers with hot tea, medical treatment and sickness payment.
Then the era of scientific management was started with F. W. Taylor converted general theory
and ideas into practical tools. He advocated the selection of right people for right jobs, train
them adequately, placing them for to be specialized with fair remuneration. This work was
criticized by other management thinkers and an employee due to it’s over-emphasized on task
accomplishment and monetary incentives than respect for human efforts.

A depression and recession period of 1930 has lower down the market and living standard of
people. During this factory owners could realize that only production could not be major
element of any business but marketing, finance, and of course human resource are important
functions of any organization. Even exploited workers could realize about their protection and
unions of workers were formed.

5.4 THE HAWTHORNE STUDIES

The Hawthorne Studies were conducted at the Hawthorne plant of western Electric Co. in
Chicago from 1927 to 1932. Pilot study was carried out from 1924 to 1927 on experimental
basis. This study was carried out by Elton Mayo, a professor of Harvard Business School. The
Mayo wanted to find out the effect of fatigue and monotony on job productivity and usage of
different variables like rest breaks, working hours, working conditions like humidity and
temperature. This would lead to human motivation that would help to revolutionize the theory
and practice of management. This study is regarded as mile stone for behavioral studies. Elton
Mayo is been coined as “father of human relations movement”.

Experiment - For study he chose six girls from assembly line and separated them from the rest
of the workers and put them under the eye of friendly supervisor. Mayo made frequent
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changes in their working conditions and discussed about changes with them. Actual
experiment carried out with different steps, as –

Normal condition i.e. routine work

• 2400 relays a week

put on piece work • Output increased

Two 5 minutes rest pauses • Output increased

Rest pauses increased by 10 minutes • Output increased

Six 5 minutes pauses • Output decreased

Two rest pauses with free hot meals • Output increased

Finish work 1/2 an hour before regular • Output increased

Finish work 1 hour before as regular • Output remained same

All the facilities taken away and backed

with normal condition
• Drastic change occured with 3000 relays per week per girl.

Table 5.1

1. Under normal conditions, with a 48-hour week, including Saturdays, and no breaks, the
girls produced 2,400 relays a week each.
2. They were then put on piece-work for 8 weeks. Output went up.
3. Two 5-minute rest pauses, morning and afternoon, were introduced for a period of 5
weeks. Output went up once more.
4. The rest pauses were lengthened to 10 minutes each. Output went up sharply.
5. Six 5-minute pauses were introduced, and the girls complained that their work rhythm
was broken by the frequent pauses. Output fell slightly.
6. The 2 rest pauses were re-instated, the first with a hot meal supplied by the Company
free of charge. Output went up.
7. The girls finished at 4.30 pm instead of 5.00 pm. Output went up.
8. The girls finished at 4.00 pm. Output remained the same.
9. Finally, all the improvements were taken away, and the girls went back to the same
conditions that they had at the beginning of the experiment: work on Saturday, 48-hour
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week, no rest pauses, no piece work and no free meal. These conditions lasted for a
period of 12 weeks. Output was the highest ever recorded with the girls averaging 3000
relays a week each.

The combination of results during and after the experiment led Mayo to conclude that workers
were motivated by psychological conditions more than physical working condition. He also
concluded that workers were motivated by more than self interest. Even this study is evident
that the informal associations to be found in almost every organization profound effect on an
individual’s motivation to work, Level of output and quality of performance.

Activity 1

Find out name of other management scientist, those have contributed in the development
of Organizational Behavior.

5.5 PERSONALITY

Personality refers to individual differences in characteristic patterns of thinking, feeling and

behaving. Personality arises from within the individual and remains fairly consistent through life
surrounding situation play an important role in determining how different aspects of your
personality are expressed. There are four fundamental characteristics of personality.

1. It is constant and people tend to behave in the same way when they encounter similar
situations.
2. Personality not only influences actions, but it also actually causes people to behave in
specific ways.
3. Personality is influenced by both psychological and biological factors.

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4. Personality is expressed not only in behaviors, but through emotions, thoughts, social
behavior, and close relationships.

Personality is a psychological construct, but research suggests that it is also influenced, by

biological processes and needs. Personality does not just influence how we move and respond
in our environment; it also causes us to act in certain ways. Personality is displayed in more
than just behavior. It can also be seen in our thoughts, feelings, close relationships and other
social interactions. Behavior is how you react to social and physical aspects of your environment
based on your personality. Where one person may never show emotions of anger, joy, grief, or
anxiety, another person's responses may be dramatically colored with facial expressions, voice
inflections, and hand gestures. Behavior is examined in two ways: internally controlled and
externally controlled. Internal theorists believe the individual characteristics of a person dictate
the behavioral pattern, while external advocates hold that the behavior is a result of the
situation at hand.

Fred Luthans has stated that personality will mean how people affect others and how they
understand and view themselves, as well as their pattern of inner and outer measurable traits
and their person-situation interaction behavior. He has defined two variable concepts of
personality –

a. Self-Variables
The self of a person is a unique product of many interacting parts and may be thought of
as the personality viewed by a person within. People's understanding regarding
themselves is called self-concept in personality theory. Self-esteem, multiple
intelligences, emotion, optimism and efficacy are important self-variables and have
application in organizational behavior.

b. Self-Esteem
Self-esteem includes people's self perceived competence and self-image. Is high self
esteem good for organization's performance. Kreitner and Kinicki concluded that
high self esteem can be good thing only when it is nurtured and channeled in
constructive and ethical ways. Otherwise, it can become antisocial and destructive.
So behavior managers have a role to play in getting the appropriate performance
from high self-esteem individuals.
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An elaboration of self esteem in organizational context has emerged. It is called organization-

based self esteem (OBSE). It is defined as the self-perceived value that individuals have of
themselves as organization members acting within an organization context.

Self esteem is a global trait, meaning it is present interactions of an individual in a similar way.

5.6 ATTITUDE

An attitude is a learned predisposition to respond in a consistently favorable or unfavorable

manner with respect to a given object. Attitudes influence with their actions and decisions.
Attitude do sometimes relate to behavior. Sense of ‘Why’ various factors exercise their influence.
‘Why’ is a certain kind of attitude or certain kind of situations promote attitude-behavior
consistency?

• Hogg & Vaughan defines, an attitude as "a relatively enduring organization of beliefs,
feelings, and behavioral tendencies towards socially significant objects, groups, events
or symbols”
• Eagly & Chaiken, psychologist, “a psychological tendency that is expressed by
evaluating a particular entity with some degree of favor or disfavor"

ABC model of attitudes describes three components of attitudes structure. These three
components are linked to each other. Sometimes it is also observed that cognitive and affective
components of behavior do not always match with behavior.

1. Affective component: - In this feelings or emotions are involved in the object. E.g. I do
not like dark coffee.
2. Behavioral: - This is a way the attitude we have influences how we act or behave. E.g. If
anyone offers me a dark coffee, generally I avoids to have it.
3. Cognitive: This shows person’s belief or knowledge about an object. E.g. Dark coffee is
dangerous for health.

Workplace attitudes have an effect on every person in the organization, from the employees
to the company owner. Attitudes help to develop the prevailing workplace environment that

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determines employee morale, productivity and team-building abilities. Understanding how

positive and negative attitudes affect the workplace is an important tool in creating a
harmonious workplace. There are some type of attitudes that generally practices at the
workplace.

5.7 POWER AND POLITICAL BEHAVIOR WITHIN THE ORGANIZATION

It is an ability to get something done the way a person wants it to be done. It includes the
ability to gather physical and human resource and put them to work to reach a goal. In an
organization power is used to get things done than just to dominate people and the employees
and colleagues working with. It is an unavoidable presence in an organization. Power and
authority are two different concepts while both are integrated with each other. Authority flows
from a person’s position in an organization, while power can build up at any level.

Power is essential for leadership and management. Powerful leaders delegate decision
authority, it regards people’s talent as a resource. It can change people’s working conditions
and receives resources and information to get work done. Leader with full of power accept the
challenges and risk, whenever necessary that in benefit of the organization. Power allotted to
leaders and managers develops creativity and innovation. It promotes the opportunities to
work into groups.

Types of power
A. Organizational Power –
All management level positions do posses organizational powers. These powers remain
to all those positions within the organization though a person leaves that post.
1. Legitimate power – These derives from position they are allotted and it provides
decision authority.
2. Reward power – this power allows appreciating employees with positive results and
person’s behavior and providing organizational reward systems and policies.
3. Information power – It allows holding, collecting, and controlling and distributing
information to a relevant person.
B. Personal power –

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Personal powers are affected by attributions processes. It flows from the attributes and
qualities of the person.
1. Referent power – Positive feelings about the leader.
2. Expert power – a person who is posses with technical knowledge and expertise does
hold power with the authority.

5.8 ORGANIZATIONAL CULTURE

Culture refers to the underlying values, beliefs and codes of practices that make a community
what it is. Success and failure of any organization depends upon culture it holds. Organizational
culture is unifying and refers to the processes that bind the organization together.
Organizational culture reinforces the underlying strengths of central goals and creates a sense of
common responsibility. Culture therefore gives an organization a sense of identity - 'who we
are', 'what we stand for', 'what we do'. Culture refers to the reality of the organization about
nature of work, how people deal with each other and what behaviors are expected.

The ability of organization to be culturally innovative is related to leadership and top

management must be responsible for building strong cultures. Leaders construct the social
reality of the organization; they shape values and vision of the organization. Culture helps to
resolve the dilemma of bureaucracy, formal procedures which are necessary for business
integrity. Organizational culture is been defined by Edgar Schein as –

“A pattern of shared basic assumptions that the group learned as it solved its
problems of external adaptation and internal integration that has worked well
enough to be considered valid and, therefore, to be taught to new members as the
correct way to perceive, think, and feel in relation to those problems”.

Strong culture based organization integrates values those are intensely held and widely
shared. It has great influence on the behavior of its employees –

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Philosophy of Foundar Directors

Top Management + Social Atmosphere

Organisational culture

Fig 5.1

Types of organizational culture

A number of organizational culture types have been identified by researchers are –

1. A Power culture – this is based on the dominance of one or a small number of

individuals within an organization. They make the key decisions for the organization.
This sort of power culture may exist in a small business or part of a larger business.
2. A role culture – this exists in large hierarchical organizations in which individuals
have jobs to perform which are closely specified. Individuals tend to work closely to
their job descriptions and tend to follow the rules rather than to operate in a
creative way.
3. Task cultures – it exist when teams are formed to complete particular tasks. A
distinct team culture develops, and because the team is empowered to make
decisions, task cultures can be creative.
4. A person culture – It is the most individualistic form of culture and exists when
individuals are fully allowed to express themselves and make decisions for them. A
person culture can only exist in a very loose form.

Cultural change is most likely to take when following conditions exist –

1. Dramatic crisis exist and created

2. Turnover into leadership
3. Young and small organization
4. Weak culture.

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5.9 TEAM WORKS AND GROUPS

We are all bound to be a part of a cooperative group to accomplish our daily tasks at the
workplace, and this is what we call ‘teamwork’. Teamwork is defined as an activity or a set of
inter-related activities undertaken by a number of people, in order to achieve a common
objective. organizational leaders have recognized the added value that comes from having
employees work in formal or informal teams. However, over the last two decades, even greater
emphasis has been placed on working together in a team. Team-building and team-work skills
are essential in the workplace and highly desirable skills to possess when seeking a new job or
promotion. Teams working at their potential generate more productivity and offer better
solutions than if all of them work independently.

Types of Groups

Group formation is of the social and emotional needs of any individual. He needs to receive
social affirmation, recognition, security and status in the community. Group could be
homogenous or heterogeneous, small or large groups. The type of group formed various as
the goal that they have to achieve. Meaningful interaction between two or more people
forms a group.

Mainly there are two types of groups –

1. Formal groups – These groups are created and maintained to fulfill specific needs
related to the overall organizational goals. Those are designed by top management and
concentrates more on the performance of the job. In this generally hierarchy is
maintained and individuals status is determined according the position. Co-ordination
of members are controlled through process and procedures. Formal groups could be
identified as -
a. Command group is composed of subordinates who report directly to a common
supervisor e.g. a production manager & his subordinates in his department.
b. A task group is usually formed to solve a problem. It is comprised of the employees
who work together to complete a particular task.

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2. Informal groups – These are created in the organization because of social and
psychological forces operating at the workplace. These groups are not designed and
planned just because of workplace requirements.

Importance of team work

Teamwork in a company has a great significance as this concept proved to increased

performance and production within the organization. The benefits of teamwork can make a
positive effect on the company that incorporates this type of teamwork approach.

1. Sharing Workload – When jobs are properly distributed among the employees, all
dealing with their own particular task, no member of the team can feel over-burdened
or extra pressurized in the overall project.
2. Unity among group - Continuous interaction among the team members and working in
a group, helps in building a mutual association or bond of friendship and unity among
the employees.
3. Speed up the work - It is a fact that when people or professionals work in teams with
mutual cooperation, the tasks get accomplished at a faster pace. Teamwork is one of
the best ways to ensure the timely completion of any work, with the maximum possible
efficiency.
4. Learning opportunity - The exposure to a team of diverse members and the knowledge
of the older team members help you to grasp the new concepts quickly. At the same
time, being working in a team enables the team-members to avoid mistakes and proves
to be a bonus for the overall image of the team.
5. Provides goodwill and brand - The goodwill created by mutual cooperation of
professionals in an organization, in fact, plays a highly instrumental role in bringing in
more business and public trust.

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Activity 2

Write down at least two situations where you and your group have worked for benefit of
others, and you have gained opportunity to learn something new, increase sense of unity
among you all etc.

5.10 JOB DESIGN

Job design means to decide the contents of a job. It fixes the duties and responsibilities of the
job, the methods of doing the job and the relationships between the job holder and his
superiors, subordinates and colleagues. Job design also gives information about the
qualifications required for doing the job and the financial or non-financial reward for doing the
job.

Job design has been defined by Business Dictionary as –

“Work arrangement aimed at reducing or overcoming job dissatisfaction and employee

alienation arising from repetitive and mechanistic tasks. Through job design, organizations
try to raise productivity levels by offering non-monetary rewrds such as greater satisfaction
from a sense of personal achievement in meeting the increased challenges and
responsibility of one’s work”.

Features of good job design are -

1. Allows for employee input. Employees should have the option to vary activities

according to personal needs, work habits, and the circumstances in the workplace.

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2. Gives employees a sense of accomplishment.

3. Includes training so employees know what tasks to do and how to do them properly.

4. Provides good work/rest schedules.

5. Allows for an adjustment period for physically demanding jobs.

6. Provides feedback to the employees about their performance.

7. Minimizes energy expenditure and force requirements.

8. Balances static and dynamic work.

Various techniques used in job designing are –

1. Job Enlargement: Job enlargement changes the jobs to include more and/or different
tasks. Job enlargement should add interest to the work but may or may not give
employees more responsibility.
2. Job Rotation: Job rotation moves employees from one task to another. It distributes the
group tasks among a number of employees.
3. Job Enrichment: Job enrichment allows employees to assume more responsibility,
accountability, and independence when learning new tasks or to allow for greater
participation and new opportunities.

Job
Enlarge
ment

Job Job Job

Simplifica Rotation
tion Design

Job
Enrich
ment

Fig 5.2

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4. Job Simplification – This is a statement where employee characteristics and

qualification required for the post are defined along with duties and tasks for
satisfactory performance. It includes evaluating the work processes, methods and
procedures for multiple workers performing the same task.

5.11 INTERDISCIPLINARY APPROACH TO ORGANIZATIONAL BEHAVIOR

We need to study organizational behavior to learn about ourselves and how to deal with others.
When we are working for an organization, we contribute to be a part of various organizational
departments. Organizations are increasingly expecting individuals to work in teams. Behavior
is concerned for the way people behave in an organizational context. Organizational Behavior is
a multidisciplinary activity. Along with psychology it also integrated with sociology and also look
to other scientific fields of study of insights. Organizations multiple levels of structure, has
become necessary to understand human behavior, because people work in teams, no human
being can act in isolation.

• Learning • Group dynamics

• Motivation •Work teams
• Emotions •Conflicts
•Organisational culture
• Job satisfaction
• Attitude
Psychology Sociology

Anthropolo Social
gy Psychology

•Organisational • Behavioural change

Environment • communication
•Cross-cultural • Group decision
aspect making

Fig 5.3

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1. Psychology :
This is a line of study of human behavior that tries to identify the characterizes of
individuals and provides an understanding why an individual behaves in a particular way.
This includes Behavioral patterns such as learning, motivation, personality, emotions,
perceptions, training, job satisfaction, decision making, work design and stress, attitudes
measurement. It is a science that seeks to measure, explain and change the behavior of
human.
2. Sociology :
This is study towards Behavioral pattern of co-workers and their social behavior along
with relationship with them to maintain social groups as per social order. This mainly
focuses on social systems. It appreciates the functioning of individuals within the
organization that could be treated as sociotechnical entity. Here group dynamics,
communication within work teams, power and conflicts, organizational change,
organizational culture etc. are considered for studies.
3. Social Psychology :
Social psychology is the study of human behavior in the context of social situations. This
essentially addresses the problem of understanding the typical behavior patterns to be
expected from an individual when he takes part in a group. This focuses on the
influence of people on one another, with Behavioral change, attitude change,
communication, group process, group decision making.
4. Anthropology :
Anthropology is the study of mankind and their activities. It mainly focuses on cultural
systems, beliefs, customs, ideas and values within a society and the comparison of with
aspects like values, attitudes and even cross-cultural analysis, organizational culture,
organizational environment.

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Activity 3

Try to analyze yourself, your personality pattern. Categories and write down about yourself
in line with points mentioned in behavioral aspects, at least in one or two pages.

5.12 KEYWORDS

1. Downsizing – Reduce personnel or other resources in number or size.

2. Resistance – a force that tends to oppose or retard motion.

3. Bureaucracy – An administrative system in which the need or inclination to follow rigid or

complex procedures impedes effective action.

5.13 SUMMARY

Organizational Behavior provides set of tools that allow understanding, analyzing and describing
employee behavior in the organization. It allows managers to improve, enhance or change work
behavior so that individual, group and the whole organization can achieve their goal. It is to
understand individual in organization, group and team processes. Organizational processes
changing social and cultural environment, globalization advance information technology and
employee relationships challenges do affects behavioral patterns. Global competition is
requiring employees to become more flexible.

Managers have to shift their philosophy from treating everyone alike to recognizing differences
and responding to those differences in ways that ensure employees retention and greater
productivity while not discriminating. Organizational Behavior creates positive work
environment.

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