Introduction

Are interpersonal skills important?

 IMPORTANCE OF INTERPERSONAL SKILLS

• A survey of 2,100 CFOs across 20 industries indicated that a

lack of interpersonal skills is the top reason why some
employees fail to advance.
• Incorporating OB principles into the workplace can yield
many important outcomes
– Good workplace generate superior financial performance
– Attract and keep high performing employees
– Reduces job dissatisfaction, stress and turnover
• Studies have shown that positive social relationships help
employees to flourish, lead to improvements in Job and life
satisfaction, positive emotions at work, and perception that
one’s work has meaning.
• What are the functions of Management?
 Management- Concept

The aspects of management are:

• Managers carry out the major
functions of management
• Management is essential to any
kind of organization
• Management is essential at all
hierarchical levels
• The goal of all managers is to
create and generate surplus
• The aim of all managers is to
improve productivity
(Output/Input), efficiency and
effectiveness
• What kind of resources & capabilities are
required to run an organization?
 Management- Process

• Management process:
➢ Organization Resources: Labor, Capital, Materials, Machinery
and Information
➢ Functions of Management
➢ Attainment of organizational goals

• Manager: An individual who achieves goals through other

people
• What are the levels of management?
 Levels of Management
• Top Level: They are responsible for taking major decisions
for the organization as a whole, overall activities of the
business and accountable for its impact on the society at
large
Ex- CEO, President, VP, SVP and ED

• Middle Level Managers: They deal with the actual operation

of various departments in an organization and are directly
responsible for the performance of lower level managers
Ex- Manager, Director, Chief Manager and Department head

• First Level Managers: They are directly responsible for the

performance of employees in operations
Ex- Supervisors, Clerk, Shop floor workers and technicians
Levels of Management
• What are managerial roles?
Managerial Roles
• What are managerial skills?
 Managerial Skills

• Technical Skills: Applying specialized knowledge or

expertise

• Human Skills: Work with a good understanding of

people( individually and in groups) and motivating
them

• Conceptual Skills: Analyze, diagnose and interpret

complex business situations
• How do we define Organization Behavior?
 Definition of OB
• Organization: It is a consciously coordinated social unit,
composed of two or more people, that functions on a relatively
continuous basis to achieve a common goal or a set of goals

• Behavior: It is the way in which one acts or conducts oneself,

especially towards others

• OB: It is defined as the field of study that investigates the

impact that individuals, groups and structure have on behavior
within organization for the purpose of applying such
knowledge towards improving an organization’s effectiveness

• Human Resource: It is the sum of the inherent abilities,

acquired knowledge and skills as exemplified in the talents and
aptitudes of employees
 Significance of OB
• Development of skills: Talent and skill of employees can be
honed by training, motivation and provision of opportunities
for education and personal development

• Organizational Performance: The influence of various factors

on the performance of productive organizations is indicated in
the following equations:
➢ Knowledge * Skill = Ability

➢ Attitude * Situation = Motivation

➢ Ability * Motivation = Potential Performance

➢ Human Performance * Resources = Organizational

Performance
 Assumptions of OB
• Organizations are social systems
• People are motivated by many needs
• People may not always behave in a logical or rational manner
• People depend on each other for work
• Attitudes and performance of workers are determined by
informal work group
• Job roles are more complex than job descriptions
• Communication channels should consider both economic
aspects of an organization and feelings of people working in it
• Teamwork is essential for employees to make sound technical
decisions
• Job satisfaction gives rise to higher productivity
• For managing people effectively, managers also need good
social skills
 Interdisciplinary Approach
• Psychology: It explains, measures and remodels human behavior

• Social Psychology: It focuses on the influence of people on one

another

• Sociology: It is the scientific study of nature and development of

society and social behavior

• Anthropology: It is the study of mankind, especially of its origin,

development, customs and beliefs

• Economics: It is a science of production, distribution and

consumption of goods and services

• Political Science: It is the study of individual and group behavior

within particular political environment
Towards OB Discipline
• What is basic OB model?
 S-O-B Model
• S-O-B model is a behavioral perspective that attempts to
explain human behavior in which all the variables interact with
and influence one another

• Situation: It refers to the stimulus and various physical, socio-

cultural and technological aspects of the environment

• Organism: It includes aspects like heredity, nervous system,

sense organs, muscles, Cognitive and Psychological processes
and personality of an individual

• Behavior: It stands for behavior embracing both overt and

covert responses and patterns
SOB Model for Understanding Individual
Behavior in Organizations
 Challenges and Opportunity in OB
1. Economic pressure

2. Continuing Globalization

a. Increased foreign assignments

b. Working with people from different cultures

c. Overseeing Movement of jobs to countries with low-cost labor

d. Adapting to differing Cultural and Regulatory Norms

3. Workforce demographics

4. Workforce diversity

5. Customer service
 Biographical Characteristics
Biographical Characteristics affect the performance of
employees at work , can be easily obtained from the personnel
file of an employee and impact productivity, satisfaction,
absenteeism and turnover rates of the employees. They are:
• Age

• Gender

• Marital status

• Tenure
 Biographical Foundations of Behavior

• Heredity: It is the process by which characteristics are given

from a parent to the child through the genes

• Biological development of the individual: Physiological

aspects and level of maturity

• The nervous system: It is responsible for transmitting data in

the form of stimuli from the sense organs to the brain and
responses back from the brain to the target sites such as
muscles, organs and glands

• Cognitive processes :Thinking and Problem solving

 Diversity
• Diversity is the presence of members of different ages,
genders, ethnic groups and/or educational backgrounds in an
organization

• Composition of the workforce has been changing over the past

few years

• Managing diversity has become a challenge to organizations

• The situation today has undergone a radical change with

people from diverse backgrounds occupying managerial
positions
Reasons for Diversity
 Diversity Management

• Creation of Family-friendly workplaces

• Providing Diversity training to employees
• Developing Mentoring programs for employees
• Learning
• Empathy
• Testing- Selecting and Evaluating
• Mentoring
• Alternative work schedules
Scientific Management
is that kind of
management which
conducts a business or
affairs by standards
established by facts or
truths gained through
systematic observation,
experiment or
reasoning of work
methods to improve
the efficiency of
workers.
Administrative Theory-Fayol’s 14 Principles
Elements of Bureaucratic Organizations
Thus an organization has 3 elements-
1.Communication 2.Willingness
3.Common Purpose
Systems Theory components-Chester Bernard
An organizational system has four major components namely:
• Input: Money, Materials, Men, Machines and informational
sources are required to produce goods and services

• Transformation processes: Managerial and technical abilities

are used to convert inputs into outputs

• Output: Products, services, profits and other results produced

by the organization

• Feedback: Information about the outcomes and the position of

the organization relative to the environment it operates in
 Contingency Theory-JW Lorsch
• There is no one best way to manage all situations
• The response “ It depends” holds good for several
management situations
• The task of managers is to identify which technique
will, in particular situation, under particular
circumstances and at a particular time, best contribute
to the attainment of management goals
Contingency Theory
 Hawthorne Studies
• The Hawthorne effect is a term referring to the tendency of
some people to work harder and perform better when they
are participants in an experiment.

• The term is often used to suggest that individuals may

change their behavior due to the attention they are receiving
from researchers rather than because of any manipulation of
independent variables.

• The Hawthorne effect was first described in the 1950s by

researcher Henry A. Landsberger during his analysis of
experiments conducted during the 1920s and 1930s.

• The phenomenon is named after the location where the

experiments took place, Western Electric’s Hawthorne Works
electric company just outside of Hawthorne, Illinois.
 Hawthorne Studies
• Hawthorne effect is a type of reactivity in which individuals
modify or improve an aspect of their behavior in response to
their awareness of being observed. The experiments were
conducted in four phases
a. Illumination experiments
b. Relay assembly test room experiments
c. Interview Phase
d. Bank wiring observation room experiments
• The findings are:
➢ The group is the key factor in job performance
➢ Perceived meaning and importance of the work determine
output
➢ Workplace culture sets its own standards
 Conclusions derived - Hawthorne Studies

1. The social and psychological factors are responsible for workers'

productivity and job satisfaction. Only good physical working conditions
are not enough to increase productivity.
2. The informal relations among workers influence the workers' behaviour
and performance more than the formal relations in the organisation.
3. Employees will perform better if they are allowed to participate in
decision-making affecting their interests.
4. Employees will also work more efficiently, when they believe that the
management is interested in their welfare.
5. When employees are treated with respect and dignity, their performance
will improve.
6. Financial incentives alone cannot increase the performance. Social and
Psychological needs must also be satisfied in order to increase
productivity.
7. Good communication between the superiors and subordinates can
improve the relations and the productivity of the subordinates.
8. Special attention and freedom to express their views will improve the
performance of the workers.
 Criticism of Hawthorne Studies / Experiments

1. Lacks Validity : The Hawthorne experiments were conducted under

controlled situations. These findings will not work in real setting. The
workers under observation knew about the experiments. Therefore,
they may have improved their performance only for the experiments.
2. More Importance to Human Aspects : The Hawthorne experiments
gives too much importance to human aspects. Human aspects alone
cannot improve production. Production also depends on technological
and other factors.
3. More Emphasis on Group Decision-making : The Hawthorne
experiments placed too much emphasis on group decision-making. In
real situation, individual decision-making cannot be totally neglected
especially when quick decisions are required and there is no time to
consult others.
4. Over Importance to Freedom of Workers : The Hawthorne
experiments gives a lot of importance to freedom of the workers. It does
not give importance to the constructive role of the supervisors. In reality
too much of freedom to the workers can lower down their performance
or productivity.
Douglas Murray McGregor (September 1906 – 1 October 1964) was
an American management professor at the MIT Sloan School of
Management and president of Antioch College from 1948 to 1954.
He also taught at the Indian Institute of Management Calcutta.
 LIMITATIONS
Theory X Theory Y

Only fulfils lower needs Some workers need the

(money and job) and higher structure and instruction of
needs (job satisfaction) Theory X manager
Workers may not be able to Impossible to create an
develop and apply their full environment that benefits
capabilities and pleases everybody
 Theory X assumptions

• The average person dislikes work and tries to avoid it if he/she

can

• Employees have to be either coerced by punishment or guided

by means of financial rewards to make them work effectively

• The average employee prefers to be given directions about

his/her work and shies away from taking greater
responsibilities

• Employees are not too ambitious, seldom take risks and give
high importance to their security needs
 Theory Y assumptions
• People can put in physical and mental efforts in work as
naturally as they do while playing
• Tight controls and punishments cannot make people deliver
the goods
• An average person would not only accept responsibility but
also seek it if proper conditions exist in the organization
• If people find the job satisfying, they would be more happy
• People can solve their work related problems by using
creativity and imagination
• Generally intellectual capabilities of an average person are not
properly utilized in modern industrial condition
 Theory Z(Japanese Management Style)
• Theory Z emphasizes on building close and trusting
relationships among workers, managers and others
• The central idea is to create an industrial team within a stable
work environment which fulfills employees’ needs for
affiliation, independence and control as well as organization’s
need for high quality work
• Theory Z principles are:
➢ Increasing employee loyalty to the company
➢ Providing a job for life
➢ Strong focus on well-being of the employee both ON and OFF
the job