ORGANISATIONAL BEHAVIOR

UNIT –I
Before impending the nature and scope of Organizational Behavior, it is useful to understand
the nature of related concepts, viz., Management, Managers, And Organization.
Management is, as is too well-known, the art of getting things done through others. Stated
differently, management is social and technical process that utilizes resources, influences human
action and facilities changes in order to accomplish an organization’s goals.
Undoubtedly, what is not too well know is the fact that management is a bubbly factor in the life
of an organization. The journey of ups and downs of the firm largely depends on the quality of
management. Proficient management will contribute to the success of the organization, whatever
the constraints. Incompetent management will sure bankrupt the organization, abundance of
other resources notwithstanding. It is fact, whether the organization is a profit business unit or an
entity whose mission is mere service to society.
Managers, are the individuals who practice the art of management. In other words, it is those
people who master the needed resources of the organization, put them, to proper use and strive to
reach organization’s goals. In a typical business enterprise, managers include such motely crowd
of individuals as directors, managing directors, general managers and high-level, middle-level,
and low level managers. These managers are also called the executives. Administration is other
term generally used in this context, but its usage is more in government departments and not in
profit organizations.
Why OB is to be studied?
Following are the reasons to study organizational behavior:
• To learn about yourself and how to deal with others
• You are part of an organization now, and will continue to be a part of various
organizations
• Organizations are increasingly expecting individuals to be able to work in teams, at least
some of the time
• Some of you may want to be managers or entrepreneurs
The importance of studying organizational behavior (OB)
OB applies the knowledge gained about individuals, groups, and the effect of structure on
behavior in order to make organizations work more effectively. It is concerned with the study of
what people do in an organization and how that behavior affects the performance of the
organization. There is increasing agreement as to the components of OB, but there is still
considerable debate as to the relative importance of each: motivation, leader behavior and power,
interpersonal communication, group structure and processes, learning, attitude development and
perception, change processes, conflict, work design, and work stress. It is also important because
it focus on the following areas.

• OB is a way of thinking.
• OB is multidisciplinary.
• There is a distinctly humanistic orientation with OB.
• The field of OB is performance oriented.
• The external environment is seen as having significant impact on OB.
INTRODUCTION:
Each of us is a student of behaviour. We are aware that certain types of behaviour are linked to
certain types of responsibilities. As we mature, we expand our observations to include the
behaviour of others. We develop generalizations that help us to predict and explain what people
do and will do. How accurate are these generalizations? Some may represent extremely
sophisticated appraisals of behaviour and prove highly effective in explaining and predicting the
behaviour of others. Most of us also carry about with us a number of beliefs that frequently fail
to explain why people do what they do. As a result, a systematic approach to the study of
behaviour can improve an individual’s explanatory and predictive abilities.
Organizational Behaviour (OB) is a study involving the impact of individuals, group and
structure or behaviour within the organization. This study is useful for the effective working of
an organization. It is a study of what people do within an organization and how their behaviour
affects the performance of an organization. Organizational Behaviour is concerned mainly with
employment related matters such as job, work, leaves, turnover, productivity, human
performance and management. Organizational Behaviour also includes the core topics like
motivation, leader behaviour and power, interpersonal communication, group structure and
process, learning attitude, perception, conflicts, work design and work stress.
Organizational Behaviour introduces you to a comprehensive set of concepts and theories, it has
to deal with a lot of commonly accepted ‘facts’ about human behaviour and organizations that
have been acquired over the years, like “you can teach an old dog new tricks”. “Two heads are
better than one”. These facts are not necessarily true. Then one off-line objective of
Organizational Behaviour is to replace popularly held notions.
Organization Behaviour does offer challenges and opportunities for managers since it focuses on
ways and means to improve productivity, minimize absenteeism, increase employee job
satisfaction, etc. Organization Behaviour can offer managers guidance in creating an ethical
work climate. This is because organizational behaviour can improve prediction of behavior.
Organizational Behaviour is an applied behavioural science that is built on contribution from a
number of other behavioural discipline like psychology, sociology, social psychology,
anthropology and political science. Understanding Organizational Behaviour is becoming very
important for managers. Due to global competition, it is becoming necessary for the employees
to become more flexible and to cope with rapid changes. It is becoming challenging for the
managers to use Organizational Behaviour concepts. Organizations are no longer constrained by
national borders. Burger King is owned by a British firm, and McDonald’s sell hamburgers in
Moscow. Exaction Mobile, an American company receives 75% of its revenue from sales
outside US. All the major automobile manufactures build their cars out side their border, for
example, Honda builds cars in Ohio, USA, Ford in Brazil and Mercedes and BMW in South
Africa. This shows that the world has become a global village. Hence, managers have to
diversify work force . Work force diversity means the organizations are becoming more
heterogeneous in terms of gender, race and ethnicity.
Diversity if managed positively, can increase creativity and innovation in organizations as well
as improve decision making by providing different perspective on preplans. Quality management
is driven by the constant attainment of customer satisfaction through continuous improvement of
all organizational processes (productivity, absenteeism, turnover, job satisfaction and recently
added fifth dependent variable is organizational citizenship).
Behaviour is generally predictable if we know how the person perceives the situation and what is
important to him or her. An observer sees the behaviour as non-rational because he does not have
the knowledge of the entire situation in the same way. However, predictability can be improved
by replacing your intuition power by a more systematic approach.
The systematic approach consists of important suits and relationships and will provide a base for
more accurate predictions of the behaviour. Systematic approach beholds a basic concept that
behaviour is not random. It projects the individual’s belief, concept and then interest, etc. there
are differences in every individual and placed in similar situations they do not react alike.
However, there are some fundamental consistencies in each individual’s behaviour, which can be
identified and modified to find out the individual differences. Systematic study means looking at
relationships, attempting to attribute causes and effects and base our conclusions on scientific
evidence. That is data gathered under controlled conditions and interpreted in a rigourous
manner. Systematic study replaces intuition. Systematic approach does not mean that things that
are believed in an unsystematic way are necessarily incorrect. Sometimes, research findings may
also run counter to what you thought was common sense. The objective of systematic approach
is to move away from intuitive views of behaviour towards a systematic analysis.
DEFINATION’s:
According to Keith Davis “organizational behavior is the study and application of knowledge
about how people act within organizations. It is human tool for the human benefit. It applies
broadly to behavior of people in all type of organization such as business, government, schools,
etc. it helps people, structure, technology, and the external environment blend together in to an
effective operative system”.
Stephen Robins defines as a “field of study that investigates the impact that individuals, groups,
and structure have an organization for the purpose of applying such knowledge improving an
organization’s effectiveness”.

There are many definitions about organizational behavior; every definition must include three
important features, (1) organizational behaviour is the study of human behaviour, (2) study about
behaviour in organisations and (3) knowledge about human behaviour would be useful in
improving an organisation’s effectiveness.
Organisational behaviour is the study of what an individual thinks feels or does in and around an
organisation, both individual and in group. It investigates people’s emotions and behaviour,
behaviour & performances in a team, systems & structures of organisations. It helps to explore
and provide an understanding of all the factors that are necessary to create an effective
organisation.
GOALS OF OB:
This description specifies the goals of organizational behavior:
"The goals of OB [organizational behavior] are to explain, predict, and influence behavior.
Managers need to be able to explain why employees engage in some behaviors rather than
others, predict how employees will respond to various actions and decisions, and influence how
employees behave."
Practices to Influence and Sustain Desired Behaviors in Organizations…
There is a vast array of different types of practices that leaders and managers use to influence
their employees toward achieving the organization's goals. More recently, they use a variety of
practices to help employees to achieve their own goals, as well. Thus, it can be a challenge to
efficiently categorize and explain the practices in a manner that is comprehensive and yet well
organized.
Cultivating the Right Organizational Culture
Organizational culture can be explained as a combination of the members' values, beliefs,
assumptions and ways that they interact with each other. Basically, an organization's culture is its
personality. A person's personality influences every aspect of their life.
The same is true of an organization's culture. That is why experts on strategic planning often
assert that "culture eats strategy for breakfast" -- that is, culture often determines whether
strategies are successful or not. That is why so much of what happens in an organization starts
from its culture, especially the behaviors that occur in it. The following topics refer to practices
that might influence an organization's culture, and thus the overall behaviors in it.
Applying the Right Leadership
The culture of the organization, its current life cycle and the nature of its strategic goals all help
to suggest the types of leadership needed in an organization.
For example, a start-up organization might want leaders who are visionary and charismatic in
attracting more employees to join it. It might also want leaders who have strong expertise in the
types of products and services that it delivers. However, as the organization evolves, it might
want leaders with expertise in developing internal systems and practices to form a firm
foundation for further growth. A complicating factor about leadership is that different leadership
skills are required for leading oneself versus leading another individual versus leading a group
versus leading an organization. If the organization's culture is quite traditional, then it might
prefer a rather autocratic style of leadership; whereas, a more progressive organization might
prefer a more participatory style. Also, it is important to remember that leaders cannot
successfully lead others unless they first can successfully lead themselves.
Understanding How to Develop Great Leaders
The leaders in an organization are the "engines" that drive the activities in organizational
performance. Thus, the expertise of the leaders is a critical component in the success of the
organization itself. As discussed above, the nature of the leaders must match the models and
styles preferred by the organization. That often requires further development of the leaders,
including its executives, managers and supervisors.
Finding the Right People
The most important asset in an organization is its people. As important as having the right kind
of leaders and managers is having the right kind of employees -- employees who can do a great
job in doing the necessary work to best achieve the goals of the organization. This is where
expertise in human resource management is vital to the success of the organization. However,
small- to medium-sized organizations can still do that 20% of effort that generates 80% of the
success in finding and equipping the right people.
Understanding Nature and Needs of Employees
Historical approaches to management treated employees like machines. The top priority was on
efficiency -- on producing more results in less time. However, today's approaches have changed
dramatically. Today's leaders are realizing that they will get better performance if they treat their
employees as individuals, each of whom is unique in their own interests and capabilities -- and
also in what motivates them. For the new generations in today's workforce, it is often far more
important to find meaning and fulfillment in their work than to make more money.
Sustaining Strong Job Satisfaction
Research shows that the cost of hiring and re-training employees is one of the highest of labor
costs in organizations. Research also shows a strong correlation between job satisfaction and
employee retention. Fortunately, there are a variety of approaches to support strong job
satisfaction for employees.
Developing High-Performing Teams
Most of the significant accomplishments in organizations is done in teams. However, a team is
often comprised of a wide diversity of values, perspectives and opinions among its members. So
teams must be carefully planned, organized and supported. Also, a team is an organization -- just
a small one. Thus, team performance management is also critical to the success of a team.

FOUNDATIONS OF OB:
The subject OB is based on a few fundamental concepts which revolve around the nature of
people and organizations. Such fundamental concepts are not peculiar to the field of OB. Every
discipline, be it social sciences or physical sciences, will flourish on definite assumptions. For
example, the famous principle which runs through financial accounting is that for every debit
there shall be a corresponding credit. Similarly, the law of gravity is common whether it is in
Bombay or Bangalore.
1. There are differences between individuals.
2. A whole person.
3. Behavior of an individual is caused.
4. An individual has dignity.
5. Organizations are social systems
6. Mutuality of interest among organizational members.
7. Holistic Organizational behavior.
INDIVIDUAL DIFFERENCES…people have much in common (they become excited or they
are grieved by the loss of a loved one), but each person in the world is also individually different.
Each individual is different from others in several ways. Whether it is intelligence, physique,
personality or any such trait, one can find striking differences.
The idea of individual differences comes originally from psychology. From the day of birth, each
person is unique and individual experiences after birth make people even more different.
Individual differences mean that management can get the greatest motivation among employees
by treating them differently. If it were not for individual differences, some standard, across the
board way of dealing with employees could be adopted and minimum judgement would be
required thereafter.
Because of individual differences, OB begins with the individual. Only a person can take
responsibility and make decisions; a group by nature cannot do so. A group is powerless until
individual acts therein.
A WHOLE PERSON…when an individual is appointed, his/her skill alone is not hired, his/her
social background – likes and dislikes, pride and prejudices is also hired. A person’s family life
cannot be separated from factory life. It is for this reason that managers shall endeavor to
develop a better employee out of a worker, but also a better person in terms of growth and
fulfillment.
CAUSED BEHAVIOR…Behaviour of an employee is caused and not random. The behavior is
directed towards some end that the employee believes rightly or wrongly, is in his/her best
interest. Thus when a worker come late to his work, pelts stones at a running bus, or abuses the
supervisor, there is a cause behind. The manager must realize this basic principle and to solve the
problem of late coming or stone pelting, he/she must discover the cause behind the behavior and
tackle the issue at its root.
HUMAN DIGNITY…this concept is of a different order from the other three because it is more
an ethical philosophy than a scientific conclusion. It confirms that people are to be treated
differently from other factors of production because they are of higher order in the universe. It
recognizes human dignity because people are of a higher order, they want to be treated with
respect and dignity and should be treated this way. Every job, however simple, entitles the
people who do it to proper respect and recognition of their unique aspirations and abilities. the
concept and human dignity rejects the old idea of using employees are economic tools.
Ethical philosophy is reflected in the conscience of human kind confirmed by the experience of
people in all ages. It has to do with the consequences of our acts to ourselves and to others. It
recognizes that life has an overall purpose and accepts the inner integrity of each individual.
Since organizational behavior always involves people, ethical philosophy is involved in one way
or another in each action. Human decision cannot and should not be made apart from values.
ORGANIZATIONAL AND SOCIAL SYSTEMS…..From sociology we learn that organizations
are social systems; consequently activities therein are governed by social laws as well as
psychological laws. Just as people have psychological needs, they also have social roles and
status. Their behavior is influenced by their group as well as by their individual drives. In fact,
two types of social systems exist side by side in organizations. One is the formal system and the
other is the informal social system.
The existence of a social system implies that the organizational environment is one of the
dynamic change, rather than a static set of relations as revealed in an organizational chart. All
parts of the system are interdependent and are subject to influence by any other part. Everything
is related to everything else.
MUTUALITY OF INTEREST…..Mutual interest is represented by the statement that
organizations need people and people also need organizations. Organizations have a human
purpose. They are formed and maintained on the basis of some mutuality of interest among their
participants. People see organizations as means to help them reach their goals, while at the same
time organizations need people to help reach organizational objectives. If mutuality is lacking, it
makes no sense to try to assemble a group and develop co-operation, because there is no
common base on which to build. Mutual interest provides a superordinate goal that unites the
variety of needs that people bring to organizations. The result is that people are encouraged to
attack organizational problems rather than each other.
HOLISTIC CONCEPT….when the six fundamental concepts of OB are placed together, a
holistic concept emerges. This concept interprets people-organizations relationships in terms of
the whole person, whole group, whole organization and whole social system. It takes an across
the broad view of people in organization in an effort to understand as many as possible of the
factors that influence their behavior. Issues are analyzed in terms of the total situation affecting
them rather than in terms of an isolated event or problem.
HISTORY OF OB OR PREDECESSOR’S OF OB:
By looking back at the history of organizational behavioural, you gain a great deal of insight into
how the field got to where it is today. Three individuals are important who promoted ideas which
had major influence in shaping the direction and boundaries of Organizational Behaviour (OB).
They are: Adam Smith, Charles Babbage and Robert Owen.
Adam Simth, in his discussion made in “The Wealth of Nations” in 1776, brilliantly argued on
the economic advantage that organization and society would reap from the division of labor —
called work application in an industry. He illustrated it with the help of an application in an
industry. He concluded that division of labour raises the productivity by increasing each
worker’s skill and dexterity by saving time that is commonly lost in changing tasks and by
encouraging the creation of labour saving inventions and machinery. The result of his theory was
seen in 20th century in the form of extensive development of assembly — line production
process.
Charles Babbage, a British mathematics professor, in his book, “On the Economy of machinery
and manufacturer” published in 1832 added to Smith’s list of the advantage that accrued from
division of labor, the following:
i. It reduces the time needed for learning a job.
ii. It reduces the waste of material during the learning stage.
iii. It allows for the attainment of high skill levels.
iv. It allows a more careful matching of people’s skills and physical abilities with specific
tasks.
Babbage also proposed that the economics from specialization should be as relevant to doing
mental work as physical labour. This is reflected in industry in the form of specialization in
accounting, taxation, marketing and organizational behaviour.
Robert Owen, a Welsh entrepreneur, was one of the first industrialists to recognize how the
growing factory system was demeaning workers. He argued that money spent on improving
labour was one of the best investments that business executives can make. He argued for
regulating hours of work for all, child labour too, public education, company furnished meals at
work and business involvement in community projects.
Classical Era
It covered the period from 1900 to 1930 approximately when the first general theory of
management began to evolve. The major contributors were Fredric Taylor, Henry Fayol, Max
Weber, Mary Parker Follett and Chester Barnard.
Scientific Management
It was Fredric Taylor who noticed that employees use vastly different techniques to do the same
job — which he improved. At his time, there were no clear responsibilities laid for workers and
management. The work done by workers was very slow. Worker’s output never matched their
abilities and attitudes. No effective work standards existed. Taylor made a mental revolution
among both the workers and management by defining clear guidelines for improving production
efficiency. The four principles of management that he defined are as follows:
a. Develop a science for each element of an individual.
b. Scientifically select, train, teach and develop the worker.
c. Co-operate with the workers heartily so as to ensure that all work to be done is in accordance
with the principles of the science that has been developed.
d. Divide work and responsibility almost equally between management and workers.
Administrative Theory
The administrative theory describes efforts to define the universal functions that managers
perform and principles that constitutes good management practices. The major contribution to
this theory was that of a French industrialist. Henry Fayol
Fayol proposed that all managers perform five management functions: Planning, Organizing,
Commanding, Co-ordinating and Controlling. In addition, he described the practice of
management as something distinct from accounting, finance, production, distribution and so on.
He proposed 14 principles of management as below:
i. Division of labour : Specialization increases output by making employees more efficient.
ii. Authority: Authority gives management the right to order. Authority goes with responsibility.
iii. Discipline: Employee must obey and respect the rules. Good discipline is the result of
effective leadership.
iv. Unity of command: Every employee should receive communication from only one person.
v. Unity of direction: Each group of organizational activities that have the same objective should
be divided by one manager using one plan.
vi. Remuneration: Wages paid to workers should be fair.
vii. Subordination of individual interest: The interest of any one employee or group should not
take precedence over the interests of the organization as a whole.
viii. Centralisation: The optimum degree of centralization should be maintained for each
situation.
ix. Scalar chain: The Scalar chain measures the line of authority from top management to the
lowest ranks. Communication should follow this chain.
x. Order: Material and people should be in the right place at the right time.
xi. Equity: Managers should be kind and fair to their subordinates.
xii. Stability: High employee turnover is inefficient. Management should provide personnel
planning and ensure replacements.
xiii. Initiative: Employee allowed to originate and carry out plans will exert high levels of effort.
xiv. Esprit-de-corps: Promoting team spirit will build harmony and unity within the organization.
Structural theory
Simultaneously, the German sociologist Max Weber developed a theory of authority structures
and described organizational activity as based on authority relation. He was one who looked at
management and organizational behaviour from a structural perspective. Weber described an
ideal type of organization that he called a bureaucracy. The detail features of his ideal
bureaucratic structure are as follows:
i. Job — specialization: Jobs are broken into simple, routine and well defined tasks.
ii. Authority hierarchy: Positions are organized in a hierarchy, each lower one controlled by
and supervised by a higher one.
iii. Formal selection: All organization members be selected on the basis of technical
qualifications demonstrated by training, education or exams.
iv. Rules and regulations.- To ensure uniformity and to regulate the actions of employees,
managers must depend upon company’s rules.
v. Impersonality.- Rules and controls are applied uniformly. Avoiding involvement of
personalities and personnel preferences.
vi. Career orientation: Managers are professionals and not owners of units they manage.
They work for fixed salaries and pursue their careers within their organizations.
‘Social Man’ Theory
Taylor, Fayol and Weber could be faulted for forgetting that, human beings who are the core for
every organization and humans are social animals. Mary Parker Follett and Chester Barnard
saw the importance of the social aspect of organizations. Their ideas, though born in scientific
management, did not achieve any large degree of recognition until 1930’s. Mary first
recognized that, organization could be viewed from the perspective of individual and group
behaviour. Her humanistic ideas have influenced the way we look at motivation, leadership,
power and authority today. The Japanese put a lot of stress on group togetherness. On the other
hand, Barnard saw organizations as social systems that require human co-operation.
Barnard maintained that success depends on maintaining good relations with people and
introduced the idea that managers had to examine the environment and then adjust the
organization to maintain the state of equilibrium.
Behavioural Era
“The people side” of organization came into its own during the period known as behavioural
era’. This era was marked by human relations movement and widespread application of
behavioural research. The era saw two events. It is during this time Elton Mayo, Federick
Roethlisberger (Harvarb business school) conducted number of experiments between 1924-33.
It was these experiments paved to development of OB and throwing light that importance of
influencing factors on human productivity The birth of Personnel officer and the Creation of
industrial Psychology’. The Wages act of 1935 — known to be Magna Carta of labour was
passed in the U.S.A. It legitimized the role of trade unions and encouraged rapid growth in union
membership which opened new avenues to improve handling labor. This saw that the essence of
human relations movement is the belief that the key to higher productivity is in increasing labor
satisfaction. Three persons are important who conveyed the message that human relations are
most important. They were: Dale Carnegie, Abraham Maslow and Douglas McGregor.
Dale Carnegie through his book ‘How to Win Friends And Influence People’ conveyed the
theme that the way to success was through winning co-operation of others. His main advice was:
i. To make others feel important through sincere appreciation of their efforts.
ii. To strive to make good first impression.
iii. Win people to their way of thinking by letting others do the talking and never telling a
man he is wrong.
iv. Change people by praising their good traits and giving the leader the opportunity to seek
face.
Maslow proposed a theoretical hierarchy of five Needs: Physiological, Safety, Social, esteem and
self-actualisation. He advocated the need of satisfaction of each before turning to the next one.
He believed that self- actualization — that is, achieving one’s full potential — was the summit of
a human beings existence. Managers who accepted his theory, altered their organizations and
management practices.
McGregor is best known for his formulation of two sets of assumptions — known as Theory X
and Theory Y. The former assumes that people have little ambition, dislike work, want to avoid
responsibility and need to be closely directed to work effectively. The latter assumes that people
can exercise self-direction, accept responsibility and consider work to be as natural as rest or
play. McGregor believed that theory Y assumptions better captured the true nature of workers
and guided management better.
Jacob Moreno created analytical technique called goniometry for studying group interactions. He
constructed Sociogram that identified attraction, repulsion and indifference patterns among
group members.
BF Skinner: His research had a significant effect on the design of organizational training
programs and reward system. He found that people will most likely engage in desired behaviour
if they are rewarded for doing so, These rewards are more effective if they immediately follow
the desired response, and behaviour that is not rewarded, or is punished, is less likely to he
repeated.
David McMillan: Research has been instrumental in helping organization better to match people
with jobs and in redesigning jobs for higher achievers to reanimate their motivation potential. He
was able to differentiate people with a high need to achieve -— individuals who had a strong
desire to succeed or achieve in relation to a set of Standard — from people with a low needs to
achieve.
Fred Fiedler developed a comprehensive theory of Leadership. he developed a questionnaire to
measure individuals inherent leadership characters and identified what type of leadership
behaviour is most effective.
Fredrick Herzberg work had a lion’s contribution. His work sought an answer to a question of
what individuals want from their job? He concluded that people want the job. Creation of jobs
might not motivate people. If managers want to motivate workers, they should redesign jobs to
allow workers to perform more and varied tasks. The current interest in enriching jobs and
improving the quality of work- life can be traced to Herzberg’s research.
J. Richard Hackman and Greg Oldham in 1970 explained how job factors influenced employee
motivation and satisfaction. Their research also uncovered the core job dimensions-skill variety,
task identity, task significance, authority and feedback.
APPROACHES TO OB:
Four approaches to the study of organizational behavior have been discussed in the literature on
the subject. The four approaches are – Human Resource Approach, Contingency Approach,
Productivity Approach and Systems Approach.
Human Resource Approach….this approach recognizes the fact that people are the central
resource in any organization and that they should be developed towards higher levels of
competency, creativity and fulfillment. People thus developed will contribute to the success of
the organization.
The human resource approach is also called as the supportive approach in the sense that the
manager’s role changes from control of employees to active support of their growth and
performance.
The supportive approach contrasts with the traditional management approach of 1990’s. In the
traditional approach managers decided what employees should do and closely monitored their
performance to ensure task accomplishment. In the human resources approach, role of managers
change, as was stated above, from structuring and controlling to supporting.
Contingency Approach is otherwise called as “Situational Approach”. This approach is based
on the premise that methods or behaviors which work effectively in one situation fail in another.
OD programmes, for example, may work brilliantly in one situation but fail miserably in another
situation. Results differ because situations differ. The manager’s task, therefore, is to identify
which method will, in a particular situation, under particular circumstances, and at a particular
time, best contribute to the attainment of organization’s goals.
The strength of the contingency approach lies in the fact it encourages analysis of each situation
prior to action while at the same time discourages habitual practice of universal assumptions
about methods and people. The Contingency approach is also more interdisciplinary, more
system – oriented and more research – oriented than in any other approach.
Productivity Approach……Here in this approach Productivity which is the ratio of output to
input, is a measure of an organization’s effectiveness. It also reveals manager’s efficiency in
optimizing resource utilization. The higher the numerical value of the ratio, the greater the
efficiency.
Productivity is generally measured in terms of economic inputs and outputs, but human and
social inputs and outputs also are important. For example, if better organizational behavior can
improve job satisfaction, a human output or benefit occurs. In the same manner, when employee
development programs lead to a by-product of better citizens in a community, a valuable social
output occurs. Organizational behavior decisions typically involve human, social, and / or
economic issues, and so productivity usually a significant part of these decisions is recognized
and discussed extensively in the literature on OB.
Systems Approach…..systems approach to OB views the organization as a united, purposeful
system composed of interrelated parts. This approach gives managers a way of looking at the
organization as a whole, whole person, whole group and the whole social system. In so doing,
systems approach tells us that the activity of any segment of an organization affects, in varying
degrees, the activity of every other segment.
A Systems view should be the concern of every person in an organization. The Clerk at a service
counter, the machinist, and the manager-all work with the people and thereby influence the
behavioral quality of life in an organization and its outputs. Managers, however, tend to have
larger responsibility, because they are the ones who make majority of the decisions affecting
human issues, and most of their daily activities are people- oriented. The role of the managers,
then, is to use organizational behavior to help achieve individual, organization and social goals.
Managers help build an organizational culture in which talents are utilized and further developed,
people are motivated, teams become productive, organizations achieve their goals and society
reaps the reward.
EMERGING TRENDS IN ORGANISATIONAL BEHAVIOUR:
Organizations have entered a new era characterized by rapid, dramatic and turbulent changes.
The accelerated pace of change has transformed how work is performed by employees in diverse
organizations. Change has truly become an inherent and integral part of organizational life.
Several emerging trends are impacting organizational life. Of these emerging trends, five will be
examined: Globalization, Diversity, Flexibility, Flat, And Networks. These five emerging
trends create tensions for organizational leaders and employees as they go through waves of
changes in their organizations. These tensions present opportunities as well as threats, and if
these tensions are not managed well, they will result in dysfunctional and dire organizational
outcomes at the end of any change process.
Organizations have witnessed a great development from the olden times particularly in respect of
structure, operations and people. There is a considerable change in the cross culture environment,
influence of MNCs, growth in the technical know-how and quality management which has
provided different environment in the modern organizations.
GLOBALIZATION ->>> Organizations operate in a global economy that is characterized by
greater and more intense competition, and at the same time, greater economic interdependence
and collaboration. More products and services are being consumed outside of their country of
origin than ever before as globalization brings about greater convergence in terms of consumer
tastes and preferences. Yet at the same time, in the midst of greater convergence, there is the
opposite force of divergence at work where companies have to adapt corporate and business
strategies, marketing plans, and production efforts to local domestic markets.
To stay competitive, more organizations are embracing offshore outsourcing. Many functions are
being shifted to India, the Philippines, Malaysia, and other countries for their low labor costs,
high levels of workforce education, and technological advantages. According to the 2002-2003
Society for Human Resource Management (SHRM) Workplace Forecast, companies such as
Ford, General Motors, and Nestle employ more people outside of their headquarters countries
than within those countries. Almost any company, whether in manufacturing or services, can find
some part of its work that can be done off site. Forrester Research projects that 3.3 million U.S.
service- and knowledge-based jobs will be shipped overseas by the year 2015, 70 percent of
which will move to India. Communication and information sharing are occurring across the
globe in multiple languages and multiple cultures. Global competition and global cooperation
coexist in the new world economy.
One major consequence of globalization is greater mobility in international capital and labor
markets. This creates a global marketplace where there is more opportunity, because there are
more potential customers. However, there is also more competition, as local companies have to
compete with foreign companies for customers. According to Dani Rodrik, professor of
international political economy at Harvard's Kennedy School of Government, the processes
associated with the global integration of markets for goods, services, and capital have created
two sources of tensions. First, reduced barriers to trade and investment accentuate the
asymmetries between groups that can cross international borders, and those that cannot. In the
first category are owners of capital, highly skilled workers, and many professionals. Unskilled
and semiskilled workers and most middle managers belong in the second category.
Second, globalization engenders conflicts within and between nations over domestic norms and
the social institutions that embody them. As the technology for manufactured goods becomes
standardized and diffused internationally, nations with very different sets of values, norms,
institutions, and collective preferences begin to compete head on in markets for similar goods.
Trade becomes contentious when it unleashes forces that undermine the norms implicit in local
or domestic workplace practices.
Trends Tensions
1. Globalization ---à Global versus Local
2. Diversity ---à Heterogeneity versus Homogeneity
3. Flexibility --à Flexibility versus Stability
4. Flat ---à Centralization versus Decentralization
5. Networks --à Interdependence versus Independence
Professor Rodrik concluded that "the most serious challenge for the world economy in the
years ahead lies in making globalization compatible with domestic social and political
stability". This implies ensuring that international economic integration does not lead to
domestic social disintegration. Organizations that are confronted with this challenge will have to
manage the tension created by the global integration versus local disintegration dilemma.
The overall picture as a consequence of globalization is one of turbulence and uncertainty, in
which a variety of contradictory processes present a wide range of both opportunities and threats
that defy established ways of doing business and working in organizations. Integration and
exclusion coexist uneasily side-by-side in organizations.
For example, many apparent dichotomies or paradoxes—competition versus collaboration,
market forces versus state intervention, global actions versus local solutions—are losing their
sharp edges as contradictory forces appear to converge and reinforce each other in organizations
across the globe. Companies that compete fiercely in some markets form strategic alliances in
others; government guidance and regulation are required to make markets work effectively; and
"think globally, act locally" has been adopted as business strategy (or as a mantra) to deal with
the challenges of doing business in the globalized economy. As organizations transform
themselves to stay competitive, they will need to confront and resolve some, if not all, of these
dichotomies or paradoxes.
On another level, because of globalization, the fates of people living and working in different
parts of the world are becoming intertwined. Global events may have significant local impact.
September 11, 2001 has been called the "day that changed the world". Heightened security
concerns are changing expectations for people in organizations, and the role of organizations
themselves. The threat of terrorism continues to be an ongoing concern worldwide. It has created
a renewed focus on workplace security as employees experience a heightened sense of
vulnerability in the workplace. Employee monitoring and screening are occurring more
frequently. Concern over travel for business purposes is resulting in the increased use of alternate
forms of communication such as teleconferencing and videoconferencing.
DIVERSITY
Globalization is impacting how organizations compete with each other. In combination with
changing demographics, globalization is causing a rapid increase in diversity in organizations.
Never before have people been required to work together with colleagues and customers from so
many different cultures and countries.
Diversity is moving American society away from "mass society" to "mosaic society".
Organizations reflect this "mosaic society" in their more diverse workforce (in terms of not only
race, ethnic or culture but also in terms of age, sexual orientation, and other demographic
variables). More than ever, people have to interact and communicate with others who come from
diverse backgrounds. This in turn has meant that employees need new relational skills to
succeed. An emerging stream of research in international management has called these new
relational skills "cultural intelligence". Cultural intelligence is defined as the capability to adapt
effectively across different national, organizational and professional cultures (Earley, Ang and
Tan, 2005). More managers take up global work assignments in industries around the world.
They learn how to work with people who not only think and communicate differently but also do
things differently. Managers will need to develop their cultural intelligence to manage greater
diversity in organizations.
Diversity in organizations will continue to increase. As indicated by the U.S Census Bureau
National Population Projections, the Hispanic population will increase by 11.2 percent between
2000 and 2025 to become the largest minority group in the United States. All other minority
groups will increase by about 9 percent, while the number of Caucasians will decrease by
approximately 19 percent. The world population is growing at a high rate in developing
countries, while remaining stable or decreasing in the developed world. The result will be
income inequities and economic opportunity leading to increased immigration and migration
within and between nations. More temporary workers will be used for specific tasks, and there
will be a greater demand for highly skilled workers.
The aging American workforce population means more retirees and potential gaps in availability
of experienced workers. According to American Association of Retired Persons (AARP), by
2015 nearly one in five U.S. workers will be age 55 or older. Retirees often want to keep a foot
in the workplace. AARP's research shows that nearly 8 of 10 baby boomers envision working
part time after retirement; 5 percent anticipate working full time at a new job or career; only 16
percent foresee not working at all.
People of different ethnic and cultural backgrounds possess different attitudes, values, and
norms. Increasing cultural diversity in both public and private sector organizations focuses
attention on the distinctions between ethnic and cultural groups in their attitudes and
performance at work. This greater focus can result in the tension between finding similarities and
accentuating differences in the face of greater diversity in organizations.
There is an on-going debate between the heterogenists and the homogenists concerning the
impact of greater diversity in organizations. The heterogenists contend that diverse or
heterogeneous groups in organizations have performance advantages over homogeneous groups
while the homogenists take the opposing view—that homogeneous groups are more
advantageous than heterogeneous or diverse groups in organizations.
According to the heterogenists, organizations with greater diversity have an advantage in
attracting and retaining the best available human talent. The exceptional capabilities of women
and minorities offer a rich labor pool for organizations to tap. When organizations attract, retain,
and promote maximum utilization of people from diverse cultural backgrounds, they gain
competitive advantage and sustain the highest quality of human resources.
Organizations with greater diversity can understand and penetrate wider and enhanced markets.
Not only do these organizations embrace a diverse workforce internally, they are better suited to
serve a diverse external clientele. Organizations with greater diversity also display higher
creativity and innovation. Especially in research-oriented and high technology organizations, the
array of talents provided by a gender- and ethnic-diverse organization becomes invaluable.
Heterogeneous or diverse groups display better problem solving ability as they are more capable
of avoiding the consequences of groupthink, compared to highly cohesive and homogeneous
groups that are more susceptible to conformity.
On the other hand, greater organizational diversity has its drawbacks. With the benefits of
diversity come organizational costs. Too much diversity can lead to dysfunctional outcomes.
Diversity increases ambiguity, complexity, and confusion. Organizations with greater diversity
may have difficulty reaching consensus and implementing solutions. In many organizations,
diversity can produce negative dynamics such as ethnocentrism, stereotyping and cultural
clashes.
The homogenizes argue that homogeneous groups often outperform culturally diverse groups,
especially where there is a serious communication problem. Cross-cultural training is necessary
to enable culturally diverse groups to live up to their potential and overcome communication
difficulties. The diversity movement, according to the homogenizes, has the potential to polarize
different social groups and harm productivity while breeding cynicism and resentment,
heightening intergroup frictions and tensions, and lowering productivity, just the opposite of
what managing diversity is intended to accomplish.
The challenge therefore is for management to manage the tension produced by heterogeneity
versus homogeneity. If properly managed, organizations can reap the benefits of greater
diversity. Aside from proper management, organizations need to learn to appreciate and value
diversity before the benefits of diversity can be fully realized. To achieve this, diversity training
programs may help people in organizations understand and value diversity.
FLEXIBILITY
Globalization and diversity trends are forcing organizations to become more flexible and
adaptable. To be able to function globally and to embrace diversity, leaders and employees in
organizations have to become more flexible and develop a wider repertoire of skills and
strategies in working with diverse groups of people in the workplace as well as in the
marketplace.
The response to increased diversity has, in many cases, been increased organizational flexibility.
Some organizations allow workers to have very different work arrangements (e.g. flex-time) and
payment schedules. Some organizations (and workers) have found it convenient to treat some
workers as independent consultants rather than employees. In certain occupations, advances in
communication and information technologies have enabled telecommuting —working at home
via computer. One consequence of this is the blurring of boundaries between work and home,
and where and when work occurs. The benefits of greater flexibility may be countered by the
negative consequences of working 24/7 including higher stress and burnout.
The response to increased competition, however, has resulted in a tension generated by the
demands to be flexible and yet maintain some stability as changes are implemented in
organizations. To stay competitive, organizations are constantly changing and restructuring to
increase flexibility and decrease costs. Business process reengineering, business process out-
sourcing, job redesign, and other approaches to optimize business processes have been
implemented to increase operational and process efficiency while reducing the costs of doing
business.
Changes in business and operational processes need time to stabilize for employees to learn the
new processes, become familiar with them, and be able to operate effectively and efficiently.
Yet, competitive pressures can cause organizations to go through a series of changes without
giving employees adequate time for learning and training, and for the benefits of the change to
be fully realized in the organization. This tension is well-captured by Columbia Business School
professor Eric Abrahamson in his book, Change Without Pain (2004) in which he discussed how
organizations can go through change overload and how employees can experience change fatigue
and burnout. Professor Abrahamson proposes "creative recombination" as an alternative
approach to the highly destructive, destabilizing and painful changes caused by "creative
destruction".
FLAT
In a greater competitive marketplace, speed or response time is critical. How organizations
response to customers and other stakeholders or be the first to market may make a significant
difference as time is at a premium. Organizations that can develop new technologies faster or can
adapt to changes in the market faster are the ones that will survive the competition. To maximize
response time, organizations have been flattening their hierarchies and structures, in addition to
other initiatives such as downsizing and networking. Flat organizations make decisions more
quickly because each person is closer to the ultimate decision-makers. There are fewer levels of
management, and workers are empowered to make decisions. Decision-making becomes
decentralized.
However, flat organizations create a new tension between decentralization and centralization.
Among the drivers of decentralization are communications technologies that allow companies to
push decision-making away from the core. Proponents of decentralization emphasize the idea
that less hierarchical organizations mirror the efficiencies of the networks that enable them: they
are faster, more resilient, more responsive, more flexible and more innovative. Also, they argue,
people who work within decentralized organizations feel empowered and energized. They do not
need to focus on the chain of command and they do not feel constrained by it. Organizations are
caught between the opposing forces of centralization and decentralization. They want to leverage
the opportunities offered by decentralization and create nimbler and forceful organizations, but
they cannot always do so because the forces of centralization come into play. There are obvious
benefits to centralization as control is comparatively tighter and accountability is clearer
compared to a flatter, more decentralized organizational structure.
Take the example of IT operations. The key to a centralized organization's success is its
responsiveness. If the centralized operation can be responsive to the needs of the business, then
that approach can make sense. Several companies, such as DaimlerChrysler and PepsiCo, have
migrated back to centralizing IT operations after attempts at decentralization. The debate over
the centralization versus decentralization of operations in organizations is an enduring one. It is
an age-old battle of standardization versus autonomy, corporate efficiency versus local
effectiveness and pressure on costs and resources versus accommodation of specific local needs.
Vacillation between centralization and decentralization is both non-productive and unnecessary.
Organizations, as they desire to become flatter, will need to be clear about how they need to
respond to the tension between centralization and decentralization.
NETWORKS Organizations that flatten tend to encourage horizontal communication among
workers. Rather than working through the organizational hierarchy, it is often faster for workers
who need to coordinate with each other simply to communicate directly. Such organizations are
highly networked.
Another meaning of networked organizations refers to their relations to other organizations.
Organizations that have downsized to just their core competencies must then outsource all the
functions that used to be done inhouse. To avoid losing time and effort managing contracts with
suppliers, organizations have learned to develop close ties to their suppliers so that social
mechanisms of coordination replace legal mechanisms, which are slow and costly. In many
industries, such as the garment industry in Italy, strong relationships have developed between
manufacturers and suppliers (and other manufacturers), so that considerable work is done
without a contract and without even working out a firm price. For these networked organizations
to work, high trust and social capital between organizations are key elements.
Networked organizations are particularly important in industries with complex products where
technologies and customer needs change rapidly, such as in high technology industries. Close
ties among a set of companies enables them to work with each other in ways that are faster than
arms-length contracts would permit, and yet retains the flexibility of being able to drop the
relationship if needed (as opposed to performing the function in-house). The trend towards
networked organizations and structures create a new tension between interdependence and
independence. The forces of aggregation and disaggregation throw up new challenges for
organizations, for example, the use of independent contractors, joint ventures, strategic
partnerships and alliances even with competitors. One advantage of networks is that
organizations have greater flexibility and thus they can become more competitive in the global
marketplace. Another advantage is that organizations do not require that many resources such as
employee benefits, office space, and financing for new business ventures. On the other hand,
networks have distinct disadvantages. Organizations may find it more difficult to control quality
of goods or services as they now have to depend on their partners in the networks to deliver the
quality that is desired. Legal and contracting expertise as well as negotiation expertise will also
be important for networks. Alternative forms of control may need to be developed to control
quality. Alternative mechanisms for coordination may also need to be developed to manage the
growing constellation and sometimes tenuous nature of other partner organizations in the
network.
All the five trends and the tensions they produce result in greater organizational or system
complexity for both leaders and employees in organizations. The tensions produced by these
trends cannot be solved. They have to be managed. Effective approaches in organizational
change will involve not one strategy but many alternatives and will require leaders and
employees to develop greater resilience in confronting these tensions.

CONTRIBUTION OF VARIOUS DISCIPLINES TO OB:

Psychology
Psychology has perhaps the first influence on the field of organizational behavior because it is a
science of behavior. A psychologist studies almost all aspects of behavior. Psychology deals with
studying human behavior that seeks to explain and sometimes change the behavior of humans
and other animals. Psychologists are primarily interested in predicting the behavior of
individuals to a great extent by observing the dynamics of personal factors.
Those who have contributed and continued to add to the knowledge of OB are teaching theorists,
personality theorists, counseling psychologists and primary, industrial and organizational
psychologists.
Some of the numerous areas of interest within the disciplines of psychology are:
 General Psychology
 Experimental Psychology
 Clinical Psychology
 Consumer Psychology
 Personality and Social Psychology
 Industrial Psychology
 Counseling Psychology
 Educational Psychology
 Consulting Psychology
Understanding Psychological principles and its models help significantly in gaining the
knowledge of determinants of individual behavior such as
o the learning process,
o motivation techniques,
o personality determinants and development,
o perceptual process and its implications,
o training process,
o leadership effectiveness,
o job satisfaction,
o individual decision making,
o performance appraisal,
o attitude measurement,
o employee selection,
o job design and work stress.
Sociology The major focus of sociologists is on studying the social systems in which individuals
fill their roles. The focus is on group dynamics. They have made their greatest contribution to
OB through their study of group behavior in organizations, particularly formal and sophisticated
organizations. Sociological concepts, theories, models, and techniques help significantly to
understand better the group dynamics, organizational culture, formal organization theory and
structure, corporate technology, bureaucracy, communications, power, conflict, and intergroup
behavior. Psychologists are primarily interested in focusing their attention on individual
behavior.
Key concepts of Sociology are;
Most sociologists today identify the discipline by using one of the three statements:
Sociology deals with human interaction arid this communication are the key influencing factor
among people in social settings.
Sociology is a study of plural behavior. Two or more interacting individuals constitute a plurality
pattern of behavior
Sociology is the systematic study of social systems:
A social system is an operational social unit that is structured to serve a purpose.
It consists of two or more persons of different status with various roles playing a part in a pattern
that is sustained by a physical and cultural base.
When analyzing organizing as a social system, the following elements exist:
o People or actors
o Acts or Behavior
o Ends or Goals
o Norms, rules, or regulation controlling conduct or behavior
o Beliefs held by people as actors
o Status and status relationships
o Authority or power to influence other actors
o Role expectations, role performances, and role relationships.
Therefore, organizations are viewed by sociologies as consists of a variety of people with
different roles, status, and degrees of authority.
The organization attempts to achieve certain generalized and specific objectives.
To attain some of the abstract ends such as the development of company loyalty, the
organization’s leaders appeal to the shared cultural base.
Social Psychology It has been defined as the scientific investigation of how the thoughts,
feelings, and behavior of individuals are influenced by the actual, imagined or implied the
presence of others. It deals with how people are affected by other individuals who are physically
present or who are imagined to be present or even whose presence is implied.
In general, sociology focuses on how groups, organizations, social categories, and societies are
organized, how they function, how they change. The unit of analysis is the group as a whole
rather than the individuals who compose the group.
Social Psychology deals with many of the same phenomena but seeks to explain whole
individual human interaction and human cognition influences culture and is influenced by
culture.
The unit of analysis is the individual within the group. In reality, some forms of sociology are
closely related to social psychology. Social Psychologists study an enormous range of topics
including conformity, persuasion, power, influence, obedience, prejudice, discrimination,
stereotyping, sexism and racism, small groups, social categories, inter-group behavior, crowd
behavior, social conflict, social change, decision making, etc. Among them, the most important
topics relevant to the organizational behavior field are behavioral change, attitude change,
communication, group process, and group decision making.
Social psychologists making significant contributions. Social psychologists making significant
contributions to measuring, understanding and improving attitudes, communication patterns in
how groups can satisfy individual needs and group decision-making processes.
Anthropology The main aim of anthropology is to acquire a better understanding of the
relationship between the human being and the environment. Adaptations to surroundings
constitute culture. The manner in which people view their surroundings is a part of the culture.
Culture includes those ideas shared by groups of individuals and languages by which these ideas
are communicated. In essence, culture is a system of learned behavior.
Their work on culture and environment has helped us to understand differences in fundamental
values, attitudes, and behavior among people in different countries and within different
organizations. Much of our current understandings of organizational culture, environments, and
differences between national cultures are the results of the work of anthropologists or those using
their methodologies. The world is the laboratory of anthropologists, and human beings must be
studied in the natural habitat. Understanding the importance of studying man in natural settings
over time enables one to grasp the range of anthropology.
Familiarity within some of the cultural differences of employees can lead to greater managerial
objectivity and depth in the interpretation of behavior and performance. Anthropologists
contribute to study some aspects of organizational settings – similar values, comparative
attitudes, cross-cultural analysis between or among the employees.
Political Sciences Contributions of political scientists are significant to the understanding of
behavior in organizations. Political scientists study the behavior of individuals and groups within
a political environment. They contribute to understanding the dynamics of power centers,
structuring of conflict and conflict resolution tactics, allocation of power and how people
manipulate power for individual self-interest. n a business field, organizations wanted to attain
supremacy in their field and indulge in politicking activities to gain maximum advantages by
following certain tasks like Machiavellianism, coalition formation, malpractices, etc.
The knowledge of political science can be utilized in the study the behavior of employees,
executives at micro as well as macro level.
CHALLENGES AND OPPORTUNITIES TO OB:
Challenges and opportunities for organizational behavior are massive and rapidly changing for
improving productivity and meeting business goals. Although the problems with organizations
and the solutions over the ages have not changed, the emphasis and surrounding environmental
context certainly have changed. Although the resulting lean and mean organizations offered
some short-run benefits in terms of lowered costs and improved productivity, if they continued to
do business, as usual, they would not be able to meet current or future challenges.
As a Harvard Business Review article argues, “These are scary times for managers”. The
singular reason given for these frightening times – the increasing danger of disruptive change.
The nature of work is changing so rapidly that rigid job structures impede the work to be done
now, and that may drastically change the following year, month, or even week.
Main challenges and opportunities of organizational behavior are;
1. Improving Peoples’ Skills.
2. Improving Quality and Productivity.
3. Total Quality Management (TQM).
4. Managing Workforce Diversity.
5. Responding to Globalization.
6. Empowering People.
7. Coping with Temporariness.
8. Stimulating Innovation and Change.
9. Emergence of E-Organisation and E-Commerce.
10. Improving Ethical Behavior.
11. Improving Customer Service.
12. Helping Employees Balance Work-Life Conflicts.
13. Flattening World.

IMPROVING PEOPLE’S SKILLS: Technological changes, structural changes,

Environmental changes are accelerated at a faster rate in the business field. Unless employees
and executives are equipped to possess the required skills to adapt to those changes, the targeted
goals cannot be achieved in time. These two different categories of skills – managerial skills and
technical skills.
Some of the managerial skills include listening skills, motivating skills, planning and organizing
skills, leading skills, problem-solving skills, decision-making skills. These skills can be
enhanced by organizing a series of training and development programs, career development
programs, induction, and socialization.
IMPROVING QUALITY AND PRODUCTIVITY. Quality is the extent to which the
customers or users believe the product or service surpasses their needs and expectations. For
example, a customer who purchases an automobile has a certain expectation, one of which is that
the automobile engine will start when it is turned on. If the engine fails to start, the customer’s
expectations will not have been met and the customer will perceive the quality of the car as poor.
The key dimensions of quality as follows.
Performance: Primary rating characteristics of a product such as signal coverage, audio quality,
display quality, etc.
Features: Secondary characteristics, added features, such as calculators, and alarm clock
features in hand phone.
Conformance: meeting specifications or industry standards, the workmanship of the degree to
which a product’s design or operating characteristics match pre-established standards
Reliability: The probability of a product’s falling within a specified period
Durability: It is a measure of a product’s life having both economic and technical dimension
Services: Resolution of problem and complaints, ease of repair
Response: Human to human interfaces, such as the courtesy of the dealer « Aesthetics: Sensory
characteristics such exterior finish
Reputations: Past performance and other intangibles, such as being ranked first.
More and more managers are confronting to meet the challenges to fulfill the specific
requirements of customers. To improve quality and productivity, they are implementing
programs like total quality management and reengineering programs that require extensive
employee involvement.
Total Quality Management (TQM) Total Quality Management (TQM) is a philosophy of
management that is driven by the constant attainment of customer satisfaction through the
continuous improvement of all organizational processes.
The components of TQM are:
(a) An intense focus on the customer,
(b) Concern for continual improvement,
(c) Improvement in the quality of everything the organization does,
(d) Accurate measurement and,
(e) Empowerment of employees.
Managing Workforce Diversity This refers to employing different categories of employees
who are heterogeneous in terms of gender, race, ethnicity, relation, community, physically
disadvantaged, elderly people, etc. The primary reason to employ the heterogeneous category of
employees is to tap the talents and potentialities, harnessing the innovativeness, obtaining
synergetic effect among the divorce workforce. In general, employees wanted to retain their
individual and cultural identity, values and lifestyles even though they are working in the same
organization with common rules and regulations.
The major challenge for organizations is to become more accommodating to diverse groups of
people by addressing their different lifestyles, family needs, and work styles.
RESPONDING TO GLOBALIZATION: Today’s business is mostly market-driven;
wherever the demands exist irrespective of distance, locations, climatic conditions, the business
operations are expanded to gain their market share and to remain in the top rank, etc. Business
operations are no longer restricted to a particular locality or region. The company’s products or
services are spreading across nations using mass communication, the internet, faster
transportation, etc.
More than 95% of Nokia (Now Microsoft) hand phones are being sold outside of their home
country Finland. Japanese cars are being sold in different parts of the globe. Sri Lankan tea is
exported to many cities around the globe. Garment products of Bangladesh are exporting in the
USA and EU countries. Executives of Multinational corporations are very mobile and move from
one subsidiary to another more frequently.
Empowering People The main issue is delegating more power and responsibility to the lower
level cadre of employees and assigning more freedom to make choices about their schedules,
operations, procedures and the method of solving their work-related problems. Encouraging the
employees to participate in the work-related decision will sizable enhance their commitment to
work. Empowerment is defined as putting employees in charge of what they do by eliciting some
sort of ownership in them.
Managers are doing considerably further by allowing employees full control of their work.
Movement implies constant change an increasing number of organizations are using self-
managed teams, where workers operate largely without a boss. Due to the implementation of
empowerment concepts across all the levels, the relationship between managers and the
employees is reshaped. Managers will act as coaches, advisors, sponsors, facilitators and help
their subordinates to do their tasks with minimal guidance.
Coping with Temporariness In recent times, the product life cycles are slimming, the methods
of operations are improving, and fashions are changing very fast. In those days, the managers
needed to introduce major change programs once or twice a decade. Today, change is an ongoing
activity for most managers. The concept of continuous improvement implies constant change. In
yesteryears, there used to be a long period of stability and occasionally interrupted by a short
period of change, but at present, the change process is an ongoing activity due to competitiveness
in developing new products and services with better features. Everyone in the organization faces
today is one of permanent temporariness. The actual jobs that workers perform are in a
permanent state of flux. So, workers need to continually update their knowledge and skills to
perform new job requirements.
Stimulating Innovation and Change Today’s successful organizations must foster innovation
and be proficient in the art of change; otherwise, they will become candidates for extinction in
due course of time and vanished from their field of business. Victory will go to those
organizations that maintain flexibility, continually improve their quality, and beat the
competition to the market place with a constant stream of innovative products and services.
For example, Compaq succeeded by creating more powerful personal computers for the same or
less money than EBNM or Apple, and by putting their products to market quicker than the bigger
competitors.
The emergence of E-Organisation and E-Commerce It refers to the business operations
involving the electronic mode of transactions. It encompasses presenting products on websites
and filling the order. The vast majority of articles and media attention given to using the Internet
in business are directed at online shopping. In this process, the marketing and selling of goods
and services are being carried out over the Internet. In e-commerce, the following activities are
being taken place quite often – the tremendous numbers of people who are shopping on the
Internet, business houses are setting up websites where they can sell goods, conducting the
following transactions such as getting paid and fulfilling orders.
It is a dramatic change in the way a company relates to its customers. At present e-commerce is
exploding. Globally, e-commerce spending was increasing at a tremendous rate.
Improving Ethical Behavior The complexity in business operations is forcing the workforce to
face ethical dilemmas, where they are required to define right and wrong conduct to complete
their assigned activities. For example, Should the employees of a chemical company blow the
whistle if they uncover the discharging its untreated effluents into the river are polluting its water
resources? Do managers give an inflated performance evaluation to an employee they like,
knowing that such an evaluation could save that employee’s job?. The ground rules governing
the constituents of good ethical behavior has not been clearly defined, differentiating right things
from wrong behavior has become more blurred.
Following unethical practices have become a common practice such as successful executives
who use insider information for personal financial gain, employees in competitor businesses
participating in massive cover-ups of defective products, etc.
Improving Customer Service OB can contribute to improving organizational performance by
showing drat how employees’ attitudes and behavior are associated with customer satisfaction.
In that case, service should be the first production-oriented by using technological opportunities
like a computer, the internet, etc. To improve customer service we need to provide sales service
and also the after-sales service.
Helping Employees Balance Work-Life Conflicts The typical employee in the 1960s or
1970s showed up at the workplace Monday through Friday and did his or her job 8 or 9-hour
chunk of time. The workplace and hours were specified. That’s no longer true for a large
segment of today’s workforce. Employees are increasingly complaining that the line between
work and non-work time has become blurred, creating personal conflict and stress.
Many forces have contributed to blurring the lines between employees’ work life and personal
life. First, the creation of global organizations means their world never sleeps. At any time and
on any day, for instance, thousands of General Electric employees are working somewhere.
Secondly, communication technology allows employees to do their work at home, in their cars,
or on the beach in Cox’s Bazar. This lets many people in technical and professional jobs do their
work anytime and from any place. Thirdly, organizations are asking employees to put in longer
hours.
Finally, fewer families have only a single breadwinner. Today’s married employee is typically
part of a dual-career couple. This makes it increasingly difficult for married employees to find
the time to fulfill commitments to home, spouse, children, parents, and friends.
Today’s married employee is typically part of a dual-career couple. This makes it increasingly
difficult for married employees to find the time to fulfill commitments to home, spouse, children,
parents, and friends. Employees are increasingly recognizing that work is squeezing out personal
lives and they’re not happy about it. For example, recent studies suggest that employees want
jobs that give them flexibility in their work schedules so they can better manage work/life
conflicts. Also, the next generation of employees is likely to show similar concerns. A majority
of college and university students say that attaining a balance between personal life and work is a
primary career goal. They want a life as well as a job.
Flattening World Thomas Friedman’s book The World Is Flat: A Brief History of the Twenty-
First Century makes the point that the Internet has “flattened” the world and created an
environment in which there is a more level playing field in terms of access to information. This
access to information has led to an increase in innovation, as knowledge can be shared instantly
across time zones and cultures.
It has also created intense competition, as the speed of business is growing faster and faster all
the time. In his book Wikinomics, Don Tapscott notes that mass collaboration has changed the
way work gets done, how products are created, and the ability of people to work together without
ever meeting.

*****THE END*****