Organizational Behavior Case Study

Case -1 Surepleasure Airlines

(a) What are the dysfunctions of informal organization in the

Surepleasure Airlines?

Answer a)

Organisation interests are like to suffer in case of conflicts between formal

and informal organization roles. According to the case study of Ramesh
Ambani, operations planning manager in Surepleasure airlines, the
following dysfunctions of an informal organization can occur: -

Conflicting Roles : - The members of formal and informal Organisation faces

role conflict. If informal goals are different from formal goals, members
stick to informal goals only. E.g. If the organization of Airport Authority
required to maintain a strict control of parts having limited life. Ramesh
noticed that there were numerous instances of inaccurate records.

Group conformity: - informal organization leads to unacceptable standards.

Employees who do not participate and socialize according to informal norms
are ignored and made to feel uncomfortable to the point where they might
quit the job.

Reduce the degree of productivity: - Due to the influence of informal groups

the organization loses many efficient and hardworking employees.

In informal organization the managers are unable to control the members

and predict the outcomes.

(b) Could there be any benefits of informal organization in this

company?

Answer b)
Informal organization affect company culture and when well managed they
can improve overall communication and morale. Primary benefit of the
informal organization is that it provides an opportunity for employees to
develop bonds with coworkers. There is Cohesion of employees from various
functional areas and provides a better communication, willingness to work
together.
Informal groups are beneficial for managers, as in informal group feedback of
employee often takes place quickly with full loyalty as compared to when
employees are formally asked to provide feedback or share opinions.

(c) What suggestions would you give to the management of this

company to cope with the informal organization?

Answer c)

Adaptability /compatibility: - The goals of the organization should be

adaptable to the members of the informal group.

According to Mr. Davis “Beneath the cloak of a formal relationship in every

organization there exists a more complex system of social relationships
called informal organization” As man is social animal and he can’t live in
isolation. There is some suggestion to follow to cope with informal
organization: -

The existence of an informal group should be given a recognition in the

operating organization.

Management should try to maintain an equilibrium between the formal and

informal.

An enlightened manager can use the informal channel for proofing the
working of his formal group.

The targets and interest should be tried to integrate between formal and
informal. If this happens much of the role conflict could be avoided.

The informal group should always be taken as an integral part whenever

there is change in working methods.

The acceptable patterns of the informal group may be incorporated into

formal group to make the organization strong.
HR Case Study
Case -2 XYZ Limited
(a) Identify and discuss the core issue in the case.

Answer a) Core issue is the labor laws and its implementation by the HR.

Labor laws are backbone for the human resource management, without the
involvement of labor law there is no human resource management. There is
no validity for the human resource management without following the labor
laws.

Every HR manager must be aware of the labor laws of that country where he
is working, because most of the core HR functions are linked and according to
the labor laws. Managing human resources without following labor laws may
be illegal and may be a serious offence which may lead to close of
organization. HR Manager performs various functions and roles in an
organization. The core functions under HRM are recruitment, selection,
induction training, performance, appraisal, compensation. The above said core
functions of human resource management is having in case with the labor
laws of that country or state.

HR managers is the key role in the organizations and are directly related to
the employees. Hence, he should possess the knowledge of the labor laws.
There exists many problems between the management and the employees
which needs to be resolved by the HR manager. If they are not resolved in
time, employee many approaches the labor courts, which is very time-
consuming procedure in fact and leads to more cost to the organization. When
there is proper knowledge on the labor laws by HR manger he can resolve the
conflicts according to laws and can save time.

Any rights, obligations, disputes arising out of the employment agreement

must be kept in mind by the HR. They are the ones managing the employees.
HR need to know the terms and conditions assured to the employees.
The HR must ensure that the work environment is safe for all employees. For
female employees working overtime, there should be suitable transportation
provided to them after work hours. The HR also investigates providing things
like clean premises, hygienic restrooms, etc.

The first person we go to for a problem at work is our HR personnel. They are
the ones who keep an eye on the retention failures, nepotism, corruption, etc.
HR personnel need to know the laws to address the employees’ grievances.

(b) Was management of the company justified in implementing

the recommendations of Mr. Rog, in the absence of proper
report?

Answer b)

The management of XYZ limited done a big mistake by implementing the

recommendations of Mr Rog without checking the proper facts and figures and
there was not a proper performance report prepared for the 11 workers whose
increment was stopped.

Before any implementation of any severe actions against any employee,

management should take decisions based on valid facts, figures and reports.

HR must indulge in investigation of the recommendations made by Mr Rog

and should have check his recommendations authencity. They should have
cross question Mr Rog about his decisions.

By implementing Mr Rog decisions the company had violated the Labor laws
of the industry.

Due to lack of union in the paper company the decision taken by Mr Rog was
implemented without knowing the facts from the employees themselves or
their representative.

As Mr Rog decision was based on poor performance and efficiency of 11

employees, there was lack of information in his report like what were the
actual cause of poor performance, in what terms their efficiency was lagging,
what they were doing during their work time, Did Mr Rog given any prior
warnings to employees, Was there any personal conflict between Mr Rog and
employees. Like this there were lot of questions that were unanswered in Mr
Rog’s report, by agreeing to Mr Rog decisions the management showed that
they lacked trust on their employees, the HR didn’t put an effort to resolve
the employee’s grievances.

The HR management should have handled the 11 employees grievances by

following the below steps which they didn’t follow: -

a) Investigate and handle each case as though it may eventually result in

arbitration
b) Talk with the employee about his or her grievance; give the person a
full hearing.
c) Require the union to identify contractual provisions and laws.
d) Comply with the contractual timeline.
e) Visit the work area of the grievance.
f) Determine whether there were any witnesses.
g) Examine the grievance personnel record.
h) Fully examine prior grievance records.
i) Treat the union representative as your equal.
j) Hold your grievance discussions privately.
k) Fully inform your own supervisor of grievance matters.

(c) How would you view the action of Mr. Rog, if you were the
M.D. of the company?

Answer c)

As MD of the company I should have utilized my Leadership skills and traits.

I should have viewed the issue by knowing the concerns of both the parties in
dispute, here referring to Mr Rog and the representation of 11 employees. The
action taken by Mr rog was too harsh for the employees considering the fact
there was lack of any incentive wage system for any class of its employees.
The decision taken was the first time in the history of the company so being
the MD of the company I should be more cautious about the long-term effects
and repercussions of the decision. If I stick with the management decision
without any evidence that would cause discomfort among the other workers
of the company as well as the situation could escalate to strikes and shutdown
of the work, revolt from other workers as well.

On the other hand if I support the 11 employees, it might not go down well
with Mr Rog and being a competent man who knows his job would feel
demotivated and offended. Resulting he might resign the company, which
would be bad for company as they might lose a potential good employee.
I view action of Mr Rog was his own perspective of looking things, he didn’t
provide justification towards his view that 11 workers were lazy and inefficient.
He should have provided the evidence of his findings. The style of leadership
shown by Mr Rog is Authoritarian in nature, it shows directive behaviors,
decided alone without involving the HR or employees representation and
focused only on tasks not shown emotions towards the workers.

Mr Rog didn’t follow or shown the conflict management or resolution

techniques which says the manager should show compromising, collaborating,
assertive and accommodating behavior with his workers.

(d) Do you think the reward system instituted by the company

needs to be reviewed? Substantiate your answer with logic.

Answer d)

For every company it is mandatory to obey with the Labor Laws and
Labor Acts of the country. Here in XYZ limited company their rewards
system was very poor and unattractive for the workers as mentioned
company did not have any incentive wage system for any class of its
employees. They were all given salaries with normal annual increments.
The annual increments sanctioned each year in a routine way was very
minimal. It was the policy of the company that the increments could be
stopped if the department head concerned recommended such an
action.

The company didn’t follow the The Payment of Bonus Act i, which is an
act to provide for the payment of bonus to persons employed in certain
establishments based on profits or based on production or productivity
and for matters connected therewith. The payment of Bonus in India is
determined by the payment of bonus act, 1965.

The rewards and recognition system needs to be reviewed and changed

from the existing system as being a big paper industry with so many
different departments, action of not paying increment to 11 workers will
be seen as negative step from management by other workers which
already working on weak reward system in the company from so many
years. It is very necessary to change the rewards system as workers
working from more than 10 years were working at same straight salary
with minimum benefits. There was no incentives or motivation factor for
the workers. As the 11 workers were from the paper machine
department, was the heart of the factory where processed pulp was fed
into the paper machines. The workers job was much more tiring and
involve much of the physical activity of doing things. So workers can be
tired of doing physical work. For such workers management should bring
in new laws and rewards system to keep them motivated and healthy
in the company. When workers of the company are healthy they can
contribute more to the production and benefit for the company. Rewards
can be monetary or non-monetary like some free health schemes and
benefits for the workers and their family and children or providing free
meals during the work hours. Rewards such as these would attract good
efficiency, increase productivity and would bring in sense of attraction
and attachment to the company from the workers.
PART B
Answer any Five Questions. Answer to the point and briefly with examples (5Qx4M=20)
1. Define, what is Organizational Behavior and state why it is importance to
study Organizational Behavior?

Answer 1)
Organizational Behavior called as OB is defined as the study and
application of knowledge about how people act within an organization. It is a
human tool for human benefit. OB is directly concerned with the production
and control of human behavior (HB) in organization effective working. Three
levels of analysis must be used to fully understand the complex dynamics of
OB that are: -
a) Individual Level of Analysis
b) Group level of Analysis
c) Organisation level of Analysis
It is very important to study OB because it provides an understanding of why
people behave as they do work in organization. Some specific important
features are: -
a) OB helps in understanding organization and employees in better way. It
helps to develop friendly and cordial relationship between organization
and employee creating a healthy work environment.
b) OB helps in effective utilization of human resources. It enables manager
to inspire & motivate employees towards higher productivity & better
results as the manager can analyses and understand the nature and
behavior of his employees.
c) OB helps in developing good work-related environment in an
organization.
d) OB helps in reducing dysfunctional behavior in workplace like
absenteeism and dissatisfaction.

2. Define HRM Function in Business Organization? What are the various

challenges faced by H R Managers in managing employees in today’s
Industrial Organization
 Answer 2)

HRM is defined as a managerial function concerned with developing and

maintaining a qualified workforce. HRM deals with issues related to
employees such as hiring, training development, compensation,
motivation, compensations & administrations. Effective HRM is
becoming a vital strategic concern for most organization today.

HRM can be classified in following 3 categories: -

Managerial Function
Operative function
Advisory Function
Managerial function are as follows: -
Human Resource Planning is essential to handle future uncertainties. In this
function HR manager needs to plan activities. For e.g. number & type of
employees needed to accomplish organizational goal.
Organizing tasks are allocated among the members of organization,
relationship are identified & activities are integrated towards common
objectives.
Directing taking the max potentialities of the employee is possible through
proper direction and motivation.
Controlling the actual performance of employees is checked verified and
compared with plans. If it is deviated from plan control measures are needed.

Operative function of HRM are

Recruitment & Selection Hr professionals must think how to attract potential
employees, design reliable section tests, ensure new employee orientation.
Performance Appraisal & management goal settings for employee, appraising
& giving feedback are the activities through which employee performance gets
measured.
Training & development Employee knowledge skills, attitude, are enhanced by
various training & development activities by HR deptt.
Compensation Benefits: - HR manager decides what is to be paid for different
type of jobs. HR decides employee compensation which includes salary,
incentives, bonuses, fringe benefits, perks etc.
Labor Relations refers to the interaction of HRM with employee who are
represented by a union. HR need to be acquainted with the laws of land,
handles employee grievances etc.
Managing diversity at work place employee differs in many ways like age,
race, gender, ability, orientation, which needs to be taken care by HR.
Advisory Function can offer advice to top management in formation and
evolution of personal policies and procedures.
Advice to deptt heads on matter such as manpower, planning, job design,
placement, training performance and appraisal.

Challenges of HR Managers are: -

Changing Employee expectations.
Rapidly changing technology
Emphasis on increased productivity
New modalities of employment – outsourcing
Flatter organization
Fall of the command and control manager

3. Explain the Process of Communication and its significance in an

organization.

Answer 3)

No organization can accomplish without effective communication.

Communication refers to transfer of information. It is a key function of
management. For success of an organization ideas, goals, plans etc must be
communicated well to the staff for good and effective coordination.
Communication process in an organization is as follows: -
Sender: - must have the idea information which he wants to convey.
Formulates the message that needs to be conveyed. Sender decides whom to
send the message.
Message may consist of information, acts. It is the subject matter of
communication which sender creates in his mind and conveys to the receiver.
Encoding when the sender translates the message into words, symbols or
some other form he is using encoding skills. Effectiveness of encoding depends
on the skills and knowledge of sender and receiver.
Channel of communication includes speaking, writing, memos, letters, emails,
faxes and even non-verbal communication such as body language kinesics.
Receiver is a person who receives the message and understand the same and
uses for the necessary action.
Decoding: - the receiver must have the enough knowledge to understand and
decode the message. For e.g. if message is in foreign language not known by
the receiver it would be decoding failure.
Feedback: - After understanding the message receiver replies to the sender
which is known as feedback. Effectiveness of the message is measured by
feedback.
Communication is central to the entire management process for the following
reasons: -
Communication is the linking process of management by which people can
obtain and exchange information. If information on which a decision is based
is poor the decision will often be incorrect.
The most time-consuming activity a manger engages in is communication. He
communicates with employees and other internal and external customers.
Represents power in organization the staff members who have complete
information becomes the centre of power.
No manager can handle conflict, negotiate successfully and succeed leadership
without being a good communicator both orally and in writing.

4. Define motivation? Explain motivation with either Maslow’s Need Hierarchy

theory or Herzberg’s Two Factor Theory?

Answer 4): -

Motivation is the process that account for an individual’s intensity, direction

and persistence of an effort towards attaining a goal or an objective. The
three-key element of motivation are Intensity: - How hard a person tries
Direction: - Towards beneficial goal
Persistence: - How long person tries
Motivation is a key part of HR function. There are different workplace
motivators such as; -
Internal factors, Boss Attitude, Salary & Benefits, Work Style Compatibility,
Schedule & flexibility, Co worker friendliness, Potential for Advancement,
Extrinsic Factors (Money, prestige, honor and power.)
Motivation have been explained by different theories such as Maslow’s Need
Hierarchy and Herzberg 2 factor theory.

The 2-factor theory known as Herzberg’s motivation-hygiene theory

states that there are certain factors in the workplace that cause job
satisfaction while there are separate set of factors that cause dissatisfaction.

These factors are: -

Motivation Factors & Hygiene Factors

Hygiene factors are needed to ensure that an employee is not dissatisfied with
the environment and work culture made available to him.
Motivation factors are needed to motivate an employee to higher performance
and attaining his goals and reach to a position.

Intrinsic Motivators: - Content of the job- what you ask me to do at work

Extrinsic Hygiene factors is the job environment conditions in which you
expect me to work.
Some needs are not motivators, but only de-motivate if not fulfilled (hygiene
factors) – e.g. Pay, working conditions, relationship with boss. Other needs
can motivate (motivating factors) – e.g. intrinsic motivation of doing a good
job, reward, recognition and growth.

Examples of Hygiene Factors are :-

• Social Security, status, relationship with colleagues, personal life,
salary, work conditions, relationship with supervisor, company policy
and administration.
• Examples of Motivational factors are:
• Growth prospectus, career enhancement, moving up the organization
ladder, responsibility, challenges, recognition and achievements.

5. Define group and work team. Explain the benefits organization and
individuals derive from working in team

Answer 5)

A group and work team can be defined in terms of size, selection,

Leadership, perception, style and spirit.
Group is a medium or large, selection is immaterial, leadership is solo,
perception is focus on leader, style is convergence and spirit is of
togetherness. In a group information is shared, decisions taken, helps
each group member perform within his or her area of responsibility,
individual accountability with random skills sets.

Team is limited in size, selection is crucial, leadership keeps on rotating

or shared, perception is mutual knowledge understanding, role spread
coordination style and dynamic interaction spirit. In a team individual
effort result in performance that is greater than the sum of the individual
inputs, here accountability is on individual and mutual with
complementary skills.
 Teams can be classified according to their objective. The most common
forms of teams that are likely available in an organization are:
1. Problem-solving teams
2. Self-managed teams
3. Cross-functional teams
4.Virtual teams

Benefits derived from working in a team for an organization and

individuals are: -

1. Maximizes Involvement
2. Shared Information
3. Problem Solving
4. Shared Goals
5. Wisdom of Crowds
6. Improved Outcomes
7. Sense of Ownership
8. Sense of Security
9. Greater Risk Taking
10. Decisions Understood
11. Greater Aptitude for Complex Problems
12. Faster Resolutions
13. More Involvement with New Ideas
14. More Inputs Mean More Creativity
15. Greater Motivation and Morale

Benefits an organization achieves from the team are: -

Organizations decisions are effective and result oriented.
Pushed by the group dynamically
Mutual support within team results in strong bonding
Meeting Goals through Collective efforts
Celebrate diversity in team
Utilizes individual strengths