Organizational Behavior

MBA Summer Semester 2013

Nasreen Wadud Course Instructor

Organizational Behavior

Organizational behavior (OB) is the study and application of knowledge about how people as individual and as groups - acts within organization.

It studies three determinants of behavior in organizations

Individuals

Groups

Structure
In order to make organization work more effectively.

Organizational behavior
It is concerned with the study of what people do in an organization AND how that behavior affects the performance of the organization. It is concerned with employee related situations as;
Behavior related to job Work Absenteeism Employment Turnover Productivity Human performance Management

Organizational behavior
To identify ways in which people can act more effectively

It helps the managers to understand:

The behavior of individuals, Their interpersonal relationship, Group dynamics and The system as a WHOLE

Goals
Four goals of OB are to:

Describe

Control

Predict

Understand

Describe: how people behave under a variety of conditions.

Understand: Why people behave as they do, the underlying explanations of human behavior in organizational settings.

Predict: predicting future employee behavior: capacity to predict which employee might be absent, tardy, or disruptive so the managers could take preventive actions.

Control: control human activity at work.

Forces of OB
A complex set of forces affects the nature of organization They are:

People

Structure

Technology

Environment

People: people make up the internal social system of organization as individuals and groups. People have their own unique way of behaving. Individuals form a group. Groups are dynamicthey form, change and disband. Structure: the relationship of the people in the organization. There are manages, employees, accountants and assemblers. They are related in some structural way to work effectively. Technology: it provides the resources, which people work, and affects the task they perform. It has a significant influence on working relationship. Environment: organizations operate within an internal and external environment. Government, family, society, other organizations, unions etc, are part of environment.

The Nature of People

There are six basic concepts of PEOPLE

1. Individual difference 2. Perception 3. A whole person 4. Motivated behavior 5. Desire for involvement 6. Value of the person

Individual difference: each person is different from all othersthey are unique. Billions of brain cells make billions of combinations. This is known as Law of Individual Difference. Perception: People see things differently. Two people may view the same object in different ways. People tend to pay attention to those features of their work environment that fulfil their expectations. This process is known as selective perception. A whole person: organizations hire a whole person not only a persons skill. Skill doesnt exist apart from background, knowledge, home life, and emotional conditions. People function as a total human being. Motivated behavior: people work to satisfy their motives. Every action of human is goal directed. Desire for involvement: people wish to feel good about themselves. They have self-efficacy the belief that one has the necessary capabilities to perform task, fulfil role of expectations, and make a meaningful contributions or to meet a challenging situation successfully. Value of the person: they deserve to be treated differently from other factors of production e.g. land, capital, technology.

The Nature of Organizations

The three key concepts of organizations are: -

Social system

Mutual interest

Ethics

Social system: formal (official) social system and informal social system. Social system is dynamic.

Mutual interest: organizations need people, People need organizations. They are formed and maintained on the basis of some Mutuality of Interest.

Ethics: Social system needs ethical treatment to succeed.

Triple Reward System

When the organizations goals and actions are ethical, mutually creates a triple reward system in which individual, organizational and social objectives are all met.

Employee goals

Ethics Employee

Organization Super ordinate goal of mutual interest Mutual accomplishment of goals Society Organizational goals

Behind the success or failure of a company its the people.

What do managers do?

They make decision Allocate resources Direct the activities Do their work in the organization

What do Organizations do?

Coordinated social units of two or more people They work in a relatively continuous basis in order to accomplish common goal or a set of goals.

Functions of Management 1.Planning 2.Organizing 3.Leading 4.Controlling

Planning

Organizing

Controlling

Leading

Planning: defining organizations goal, establishing strategy to achieve these goals, developing a comprehensive hierarchy of plans to integrate AND coordinate activities.

Organizing: determination of what tasks are to be done, who is to do them, how the tasks are to be grouped, who reports to whom, where decisions are to be made.

Leading: motivates employees, direct the activities of others, select the most effective communication channels, and resolve conflicts among members.

Controlling: monitoring performance, comparing and potential correcting.

Interpersonal roles

Informational Role

Management Role by Henry Mintzberg

Decisional Role

Interpersonal roles
Figurehead: symbolic head: require performing duties of a legal or social nature. Example- handles ceremonies, status request, and solicitations.

Leadership: includes hiring, training, motivating, and disciplining employees. Examples performs virtually all-managerial activities involving subordinates.
Liaison: contracting others who provide the manager with information. Examples - Acknowledges mail, external board work.

Informational Role
Monitor role: information from organizations and institutes outside their own. Examples; handles all mails and contacts categorized as concerned primarily with receiving information. Disseminator role: channel to transmit external and internal information to organizational members. Example: Fworards mail into organization for informational purpose: makes verbal contacts involving information flow to subordinates such as review sessions.

Spokesperson: represents organizations to outsiders on organizations plans, policies, and actions and results: serves as an expert. Example: Attends board meetings: handles contacts involving transmission of information to outsiders.

Decisional Role
Entrepreneur role: initiate and oversee new projects that will improve their organizations performance. Example: Holds review sessions involving initiation or design of improvement projects. Disturbance handler: is responsible for corrective action when organization faces important, unexpected disturbances. Example: Holds strategy and review sessions involving disturbances and crisis. Resource allocator: Make or approves significant organizational decisions. Example: Handles scheduling: requests for authorization: budgeting: the programming of subordinates work. Negotiator: is responsible for representing the organization at major negotiations. Example: handles contract negotiation.

Technical skills

Human skills

Management Skills

Conceptual skills

Technical skills: The ability to apply specialized knowledge or expertise

Human skills: To communicate, motivate and delegate The ability to work with people, to understand them both individually and in group Conceptual skills : Mental ability to analyze and diagnose complex problems Its a result of managers good experiences

Effective Managers vs. Successful Managers

Four functions of both these category as proposed by Fred Luthans
Traditional management Communication Human resource management Networking

Traditional management: decision making, planning and controlling Communication: Exchanging routine information and processing network

Human resource management: motivating, disciplining, managing conflict, staffing, and training
Networking: Socializing, politicking, and interacting with outsiders.

Findings of effective vs. successful managers

Successful managers Defined in terms of promotions High networking Low HRM Effective managers: Defined in terms of the quality of their performance and employees satisfaction and commitment. High communication Low networking Average managers: 32% time in traditional management activities 29% time in communicating 20% time in HRM 19% time in networking

Managing Work Force Diversity

Workforce diversity: among people within given countries, the increasing heterogeneity of organization with the inclusion of different groups e.g. focuses on differences among people from different countries, differences among people within given countries.

Improving Quality and Productivity

What is Total Quality Management (TQM) ?

Intense focus on the customers Concern for continuous improvement Improvement in the quality of everything the organization does Accurate measurement Empowerment of employees

Total Quality Management (TQM): Customers satisfaction through the continuous improvement of all organizational processes.

Re-engineering: it reconsiders how work would be done and the organization structure if they were being created from scratch.

Efficient- using resources wisely and in a cost effective way

Effective- making the right decision and successfully implementing them