What Is Organization Behaviour

Content of the chapter…

1) Meaning
2) Definition
3) Nature
4) Characteristics
5) Relative contribution of disciplines on OB
6) Significance of OB
7) Approaches of OB
8) Challenges
9) Do Successful Organizations Put People First?
 Meaning
OB is nothing more than developing our understanding and development of people skill. A
multidisciplinary field devoted to understanding individual and group behavior, interpersonal
processes, and organizational dynamics.
OB is Study of human behavior in organizations. There are two words-
1- Organization 2- Behaviour

An organization is a collection of people working together in a division of labor to achieve a

common purpose.

The study of Organizational Behaviour (OB) is very interesting and challenging too. It is related
to individuals, group of people working together in teams. The study of organizational behaviour
relates to the expected behaviour of an individual in 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 behaviour of an individual.

OB is concerned with the study of what people do in an organization (social system) and how
that behavior affects the performance of the organization
• Individual Behavior
• Individual and group behavior
• Organizational structure

DEFINITIONS

According to Luthans
“OB is directly concerned with the understanding, predicting and controlling of human behavior
in organizations.”

According to LM Prasad
The study and application of knowledge about human behaviour related to other elements of an
organization such as structure, technology and social systems

Stephen P Robins
Organizational behaviour as a systematic study of the actions and attitudes that people exhibit
within organizations.

Roman J. Alday
“O.B as a branch of the social science that seeks to build theories that can be applied to
predicting understanding and controlling behavior in work organizations”

“Organizational behaviour is a field of study that investigates the impact that individuals, groups
and organizational structure have on behaviour within the organization, for the purpose of
applying such knowledge towards improving an organizational effectiveness”.
 Nature of OB

1) A separate field of study and not a discipline only

It has assumed the status of a distinct field of study. It is a part of general management.
It represents behavioral approach to management.

2) An inter-disciplinary approach
The OB is heavily influenced by several other behavioral sciences and social sciences
like psychology, Sociology and anthropology. O.B. has psychological foundations. The
concept like learning, perception, attitude, motivation etc is borrowed from psychology,
sociology and anthropology.

3) A Normative Science
Organizational behaviour is a normative science. A normative science prescribes how
the various findings of researches can be applied to get organizational results, which are
acceptable to the society. Thus, what is acceptable by the society or individuals engaged
in an organization is a matter of values of the society and people concerned.

4) A Science and Art

Organization behavior is both art and science. It is considered as art because it contains
knowledge about behavior of individuals. It is considered as science because it involves
application of science.

5) Humanistic and Optimistic Approach

Organizational behaviour focuses the attention on people from humanistic point of view.
It is based on the belief that needs and motivation of people are of high' concern.
Further, there is optimism about the innate potential of man to be independent, creative,
predictive and capable of contributing positively to the objectives of the organization.

6) Oriented towards Organizational Objectives

Organizational behaviour is oriented towards organizational objectives. In fact,
organizational behaviour tries to integrate both individual and organizational objectives
so that both are achieved simultaneously.

7) A Total System Approach

An individual's behaviour can be analyzed keeping in view his psychological framework,
interpersonal-orientation, group influence and social and cultural factors; Thus,
individual's nature is quite complex and organizational behaviour by applying systems
approach tries to find solutions for this complexity..
 Characteristics of OB

1. Large Size
It employ Hundreds and thousands of employees.

2. Human Resources
3. Complexity
It involves huge investment and complicated technology, their management and
operation is a complex affair.
4. Co-ordination
5. Pattern Behavior
There is a system of working in all organization like hierarchical levels, a chain of
command, rules and procedures.
6. Discipline
7. Dynamic
Organization behavior is dynamic rather than static. It essence is reflected in change in
behavior of individuals in organization

Contributing Fields to Organizational Behaviour

Psychology:
Psychology is an applied science, which attempts to explain human behaviour in a
particular situation and predicts actions of individuals. Psychologists have been able to
modify individual behaviour largely with the help of various studies. It has contributed
towards various theories on learning, motivation, personality, training and development,
theories on individual decision making, leadership, job satisfaction, performance
appraisal, attitude, ego state, job design, work stress and conflict management. Studies
of these theories can improve personal skills, bring change in attitude and develop
positive approach to organizational systems. Various psychological tests are conducted
in the organizations for selection of employees, measuring personality attributes and
aptitude. Various other dimensions of human personality are also measured. These
instruments are scientific in nature and have been finalized after a great deal of
research.

Sociology:
Science of Sociology studies the impact of culture on group behaviour and has
contributed to a large extent to the field of group-dynamics, roles that individual plays in
the organization, communication, norms, status, power, conflict management, formal
organization theory, group processes and group decision-making .

Political science:
Political science has contributed to the field of Organizational behaviour. Stability of
government at national level is one major factor for promotion of international business,
financial investments, expansion and employment. Various government rules and
regulations play a very decisive role in growth of the organization. All organizations
have to abide by the rules of the government of the day .

Social psychology:
Working organizations are formal assembly of people who are assigned specific jobs
and play a vital role in formulating human behaviour. It is a subject where concept of
psychology and sociology are blend to achieve better human behaviour in organization.
The field has contributed to manage change, group decision-making, communication
and ability of people in the organization, to maintain social norms.

Anthropology:
It is a field of study relating to human activities in various cultural and environmental
frameworks. It understands difference in behaviour based on value system of different
cultures of various countries. The study is more relevant to organizational behaviour
today due to globalization, mergers and acquisitions of various industries. The advent of
the 21st century has created a situation wherein cross-cultural people will have to work
in one particular industry. Managers will have to deal with individuals and groups
belonging to different ethnic cultures and exercise adequate control or even channelize
behaviour in the desired direction by appropriately manipulating various cultural factors.
Organization behaviour has used the studies on comparative attitudes and cross-
cultural transactions. Environment studies conducted by the field of anthropology aims
to understand organizational human behaviour so that acquisitions and mergers are
smooth.

Significance of OB

• Managing Workplace Diversity-

Work force diversity means that organizations are becoming more heterogeneous in
terms of gender, which varies from the so-called norm. It includes women, south Indians,
Benalies, Punjabies , physically disabled, elderly etc.

• Improving ethical behavior

After understanding the mechanism of human behaviour, managers are required to
control and direct the behaviour so that it conforms to the standards required for
achieving the organisational objectives. Thus, managers are required to control and
direct the behaviour at all levels of individual interaction. Therefore, organisational
behaviour helps managers in controlling and directing in different areas such as use of
power and sanction, leadership, communication and building organisational climate
favourable for better interaction.

• In define authority, power and status of an employee -

The behaviors can be controlled and directed by the use of power and sanction, which
are formally defined by the organization. Power is referred to as the capacity of an
individual to take certain action and may be utilized in many ways. Organizational
 behaviour explains how various means of power and sanction can ,be utilized so that
both organizational and individual objectives are achieved simultaneously.

• In making communication-
Communication helps people to come in contact with each other. To achieve
organisational objectives, the communication must be effective. The communication
process and its work in inter-personal dynamics have been evaluated by organisational
behaviour.

• Essential to effectively strategy implementation-

Organizations, as dynamic entities are characterized by pervasive changes.
Organizations have to adapt themselves to the environmental changes by making
suitable, internal arrangements such as convincing employees who normally have the
tendency of resisting any changes.

• It contains a body of theory, research, application associated when a growing

concern for in work place. Its study helps in understanding human behavior. The study of
theories and research experiences of organization facilitates manager for creative
thinking to solve human problems in organizations

• Information Technology gives power and information to the one who can
use it best.

• The environment is changing rapidly making adaptation and change crucial

to survival- organizations as closed systems isn’t a valid model.

• Improving Quality and Productivity

• In making effective organizational structure

• In making group

• In motivation

• In organizational development

Approaches of OB

1. Classical Approach
Scientific Management Approach

Scientific management approach was developed by F.W. Taylor at the beginning of the 20th century. This
theory supported the use of certain steps in scientifically studying each element of a job, selecting and
training the best workers for the job arid making sure that the workers follow the prescribed method of
doing the job. It provided a scientific rationale for job specialization and mass production. His assumption
was that employees are motivated largely by money. To increase the output, Taylor advised managers to
pay monetary incentives to efficient workers.

Yet, his theory was criticized by many employers and workers. Workers objected to the pressure
of work as being harder and faster. Critics worried that the methods took the humanity out of labor,
reducing workers to machines responding to management incentives. Therefore, Taylor's view is now
considered inadequate and narrow due to the points given by the critics.

Administrative Approach

a) Bureaucratic Approach

While scientific management was focusing on the interaction between workers and the task, me
researchers were studying how to structure the organization more effectively. Instead of trying to make
each worker more efficient, classical organization theory sought the most effective overall organizational
structure for workers and managers.

The theory's most prominent advocate, Max Weber, proposed a 'bureaucratic form' of structure, which he
thought would work for all organizations. Weber's idea! bureaucracy was , logical, rational and efficient.
He made the naive assumption that one structure would work best for all organizations.

b) Henri Fayol, developed a set of 14 principles:

1. Division of Labor

2. Authority and Responsibility

3. Unity of Command

4. Line of Authority

5. Centralization

6. Unity of Direction

7. Equity

8. Order

9. Initiative

10. Discipline

11. Remuneration of Personnel

12. Stability of Tenure

13. General interest over individual interest

14. Esprit de corps

Henry Ford, Henry Fayol and Frederick W. Taylor, the early management pioneers, recognized
the behavioral side of management. However, they did not emphasize the human dimensions.
Although there were varied and complex reasons for the emerging importance of behavioral
approach to management, it is generally recognized that the Hawthorne studies mark the
historical roots for the field of organizational behaviour.

Neo – classical Approach

Hawthorne Studies

Even, as Taylor and Weber brought attention with their rational, logical approaches to more
efficient productivity, their views were criticized on the ground that both approaches ignored
worker's humanity.

The real beginning of applied research in the area of organizational behaviour started with
Hawthorne Experiments. In 1924, a group of professors began an enquiry into the human
aspects of work and working conditions at the Hawthorne plant of Western Electric Company,
Chicago. The findings of these studies were given a new name 'human relations' the studies
brought out a number of findings relevant to understanding human behaviour at work. The
Human element in the workplace was considerably more important. The workers are influenced
by social factors and the behaviour of the individual worker is determined by the group.

Hawthorne studies have been criticized for their research methods and conclusions drawn. But
their impact on the emerging field of organizational behaviour was dramatic. They helped usher
in a more humanity centered approach to work.

MODERN APPROACH TO ORGANIZATIONAL BEHAVIOUR

Human Resources Approach

The human resources approach is concerned with the growth and development of people
towards higher levels of competency, creativity and fulfillment, because people are the central
resource in any organization. This approach help employees become better in terms of work
and responsibility and then it tries to create a climate in which they can contribute to the best of
their improved abilities. This approach is also known as 'supportive approach' because the
manager's primary role changes from control of employees to providing an active support for
their growth and performance.

Contingency Approach

A contingency approach to organizational behaviour implies that different situations require

different behavioral practices for effectiveness instead of following a traditional approach for all
situations. Each situation must be analyzed carefully to determine the significant variables that
exist in order to establish the more effective practices. The strength of this approach is that it
encourages analysis of each situation prior to action. Thus, it helps to use all the current
knowledge about people in the organization in the most appropriate manner.
Productivity Approach

Productivity is a ratio that compares units of output with units of input. It is often measured in
terms of economic inputs and outputs. Productivity is considered to be improved, if more
outputs can be produced from the same amount of inputs. But besides economic inputs and
outputs, human and social inputs and outputs also arc important.

Systems Approach

A system is an interrelated part of an organization or a society that interacts with everyone

related to that organization or society and functions as a whole. Within the organization 'people'
employ 'technology' in performing the 'task' that they are responsible for, while the 'structure' of
the organization serves as a basis for co-ordinating all their different activities. The systems
view emphasizes the interdependence of each of these elements within the organization, if the
organization as a whole is to function effectively. The other key aspect of the systems view of
organization is its emphasis on the interaction between the organization and its broader
environment,, which consists of social, economic, cultural and political environment within which
they operate.

Organizations arc dependent upon their surrounding environment in two main ways:

First, the organization requires 'inputs' from the environment in the form of raw material, people,
money, ideas and so on. The organization itself can be thought of as performing certain
'transformation' processes, on its inputs in order to create outputs in the form of products or
services.

Secondly, the organization depends on environment such as, public to accept its output. The
systems view of organization thus emphasizes on the key interdependencies that organizations
must manage. Within themselves the organizations must trade off the interdependencies among
people, tasks, technology and structure in order to perform their transformation processes
effectively and efficiently. Organizations must also recognize their interdependence with the
broader environments within which they exist.

Challenges
• Challenges at the Individual Level
– Job Satisfaction
– Empowerment
– Behaving Ethically
• Challenges at the Group Level
– Working With Others
– Workforce Diversity
Workforce Diversity
An important watchword in the twenty-first century is workforce diversity—
The presence of differences based on gender, race and ethnicity, age, and able bodied ness.
Success in the new workplace requires a set of skills for working successfully with a broad
mix of People from different racial and ethnic backgrounds, of different ages and
genders, and of different domestic and national cultures. Valuing diversity is an OB theme.
It refers to managing and working with others in full respect for their individual differences.
Interpersonal sensitivity and cultural respect are indispensable to valuing diversity. Even
though valuing diversity is emphasized in books and classrooms, much remains to be
accomplished. A glass ceiling effect acts as a hidden barrier limiting the career advancement
of minorities and women in some situations. In a complex organizational environment,
different individuals with different educational backgrounds, races & different
professional/working skills work together. This leads to workforce diversity and OB needs to
manage it so that the above diversity does not offer obstacles towards growth of organization.

Challenges at the Organizational Level

1- Productivity- A performance measure including effectiveness and efficiency
2- Developing Effective Employees
 Absenteeism- Failure to report to work
 Turnover - Voluntary and involuntary permanent withdrawal from the organization
 Organizational Citizenship- Discretionary behaviour that is not part of an
employee’s formal job requirements, but is helpful to the organization
3-Competition From the Global Environment
4- Managing and Working in a Global Village

Do Successful Organizations Put People First?

Pro side-

Yes they do because organizations are social systems and the care and feeding of people and
their relationships is crucial to the organizations being able to be effective

Con side

No, most organizations are social systems secondarily. Their first need is to be efficient and to
make money. Managers need to be plugged into the outside environment but minimizing
resources such as people is crucial to the success of the enterprise.

Text Questions

Q. 1. Define organizational bevaiour. What are various fields that have contributed to the field of
organizational behaviour? Explain their contributions.
Q. 2. Explain the field of organizational behaviour. Why the study is challenging?
Q.3 Define organizational behaviour. What are the approaches of OB?
Q.4 Define OB. Describe the nature and characteristics of OB. Why the study of OB is
necessary in the field of Management?
Q.5 Explain the field of OB. Why study is challenging? Do Successful Organization put people
first?