TABLE OF CONTENTS

1. HUMAN BEHAVIOUR IN ORGANIZATION.............................................2

2. PERSONALITY...........................................................................................4

3. PERCEPTION.............................................................................................6

4. MOTIVATION..............................................................................................7

5. TRANSACTIONAL ANALYSIS................................................................10

6. TEAMS AND GROUP DYNAMICS.........................................................12

7. CONFLICT AND NEGOTIATIONS.........................................................14

8. POWER AND POLITICS..........................................................................16

9. LEADERSHIP THEORY / STYLES........................................................17

10. ORGANIZATIONAL STRUCTURE.......................................................18

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 HUMAN BEHAVIOUR IN ORGANIZATION

INTRODUCTION

Material, Manpower, Money and Machinery are the 4Ms of Management.

On 1 st May 1886, workers from Chicago protested for their rights.

In 1912, the International Labor Organization was formed.

In 1924, Hawthorne experiment was conducted

Organization
Org. Culture,
Org. Development,
Org. Change

Group
Leadership, Teams,
Group Dynamics

Individual
Perception
Personality
Motivation

ORGANIZATIONAL BEHAVIOUR:
Organizational Behaviour is a systematic study of the actions and attitudes
that people exhibit within organization.

SALIENT FEATURES OF ORGANIZATIONAL BEHAVOUR:

A. DYNAMIC:
It is very difficult to predict what employees will think and how they will
react.

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B. COMPOSITE BEHAVIOUR:
Several people with their own attitudes, perceptions and personality make
up the organization.

C. Closely related to the structure of the organization.

D. Organizational Behaviour is affected by the standard of living and by

technology.
ONE – EIGHTH PRINCIPLE – JEFF PFEFFER:
It suggests that half of the managers in an organization believe that people are
their competitive advantage. Only half of those actually will do something.
E.g.: 360 0 appraisals, incentive plans, employee welfare etc & only half of
those will continue doing that.
½ * ½ * ½ = 1/8.

Our attitudes reflect how we feel about something. These statements can be
favorable or unfavorable concerning people, objects or events.

Job satisfaction refers to individual’s general attitude towards his / her job.

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 PERSONALITY

An individual’s personality is the combination of psychological traits which

we use to classify that person.

The Myers – Briggs Type Indicator (MBTI) is used to classify personalities.

It is a 100 question test that asks people, how they feel or act in particular
situation. On the basis of their answers, they are classified as:

A. E xtroverted or I ntroverted (EorI)

B. S ensing or iN tuitive (SorN)
C. T hinking or F eeling (TorF)
D. P erceiving or J udging (PorJ)

These classifications are then combined into 16 personality types. E.g.:

A. INTJ is visionary:
They have original ideas & a great drive for their own ideas. These people
are therefore sometime seen as critical, independent, determined and often
stubborn.

B. ESTJ:
These people are organizers. They are practical, realistic and have natural
head for business. They like to organize and run activities.

C. ENTP:
This is a conceptualizer. The person is quick, creative and good at many
things. They are very resourceful in solving complex challenges but
neglect routine work.

However MBTI is not used across the world, because of the cost and need for
trained interpreters.

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Instead we use Big Five model. The factors here are:
A. EXTROVERSION:
One’s ability to form comfort level in relationships. Extroverts tend to be
sociable, assertive and gregarious.
Introverts however tend to be reserved, timid and quiet.

B. AGREABLENESS:
One’s ability to work with others. Highly agreeable people are warm, co –
operative and trusting. Low agreeableness is seen in people, who are cold,
disagreeable and antagonistic.

C. CONSCIENTIOUSNESS:
A measure of reliability. A highly conscientious person is responsible,
focussed, dependable and persistent. Those who are low on
conscientiousness are unreliable, easily distracted and irresponsible.

D. EMOTIONAL STABILITY:
A person’s ability to cope with stress. Highly stable people are calm,
confident and secure. Those with negative scores are nervous, anxious and
insecure.

E. OPENNESS TO EXPERIENCE:
A person’s willingness to try new things. Extremely open people are
creative, curious and artistically sensitive. Whereas those who score low
on this point are conventional and find comfort in the familiar.

Type ‘A’ people have a constant urge to achieve more in less time. They are
impatient, create a life of deadlines and cannot cope with leisure time. They
emphasize quantity over quality. As managers, they will work long hours and
often make poor decisions, as they make them too fast. They are not willing to
spend time finding new solutions for new problems. Type ‘A’ people may
have high performance in sales jobs, as compared to senior executive

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positions. You are likely to have higher performing, more satisfied
employees, if you match their personality types with compatible jobs.

PERCEPTION

Perception is a process by which individuals organize and interpret their

sensory impressions in order to give meaning to their environment.

Research consistently demonstrates that different individuals may look at the

same thing, yet perceive it differently. The fact is that none of us sees reality.
We interpret what we see and call it reality.

FACTORS INFLUENCING PERCEPTION:

A number of factors operate to shape and sometimes distort perception. These
factors can be in the perceiver, in the object being perceived or in the context
of the situation being perceived.

When an individual looks at the target and attempts to interpret what he / she
sees, that interpretation is heavily influenced by the personal characteristics
of the individual perceiver, including attitudes, personality, motives, interests,
past experiences and expectations.

The characteristics of the target being perceived affect what is perceived.

The context in which we see objects or events is also important. The time,
location, light and any other environmental factor affect our perception.

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Our perceptions of people differ from our perceptions of inanimate objects.
e.g.: buildings, offices etc.
When we make judgments about the behaviour of other people, we tend to
underestimate the influence of an external factors while overestimating the
influence of internal or personal factors. This is called the Fundamental
Attribution Error. It explains why a sales manager will link the poor
performance of his sales force to their laziness, rather than to the innovative
products of the competitors. On the other hand, individuals tend to attribute
their own success to their internal factors, such as ability or effort, but
blaming external factors like luck for failure.

MOTIVATION

Motivation is willingness to do something and is conditioned by the need that

will be satisfied by that action.

MASLOW’S THEORY OF HIERARCHY OF NEEDS:

Maslow said that every individual has a hierarchy of needs.

Salary
Physiological
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 Self
Actualization

Esteem Promotion

Social
Belonging

Insurance /
Security / Safety Pension /
Gratuity

A. Physiological Needs:
These include food, clothing, shelter, recreation and other bodily needs.
Companies will try to meet this need by giving a salary and offering
subsidized housing, canteen facilities, uniforms, transportation etc.

B. Safety Or Security Needs:

These needs ensure the continuation of the fulfilment of the basic needs.
Companies offer group insurance, family mediclaim, pension, gratuity etc.

C. Social Needs:
These include affection, friendship, acceptance and sense of belonging.
Companies try to fulfil this through parties, picnics, social gatherings etc.

D. Esteem Needs:
Esteem Needs include self respect, status, recognition, attention and
power. Companies meet this need by giving promotions, offering foreign
trips, sending employees as official representatives to events and
conferences.

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E. Self Actualization:
The drive to become what one is capable of becoming. i.e.: Achieving
one’s potential and self fulfillment.

According to Maslow, the needs are satisfied one level at a time. We move
from lower order needs i.e. physiological and safety to the higher order needs
i.e. social, esteem and self actualization.

ALDERFER’S ERG THEORY:

It was a modification of Maslow’s Theory. According to him, Existence
corresponds to Physiological and safety needs, Relatedness corresponds to
esteem and social needs, and Growth needs corresponds to Self Actualization.
According to Alderfer, more than one need can be active at the same time.

Relatedness
Existence .
.

Growth

McGREGOR’s THEORY X & THORY Y:

Under Theory X according to McGregor, Manager would view people:
A. People are basically lazy and they dislike work.
B. The only thing that motivates them is money.
C. Employees will avoid responsibility as much as possible.
D. People have very little ambition and value job security the most.

Under Theory Y managers will assume following:

A. Employees see their work as natural as play.

B. They need to be directed to achieve their goals.

C. They are not just motivated by money, but also look for recognition.

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D. They are able to take responsibility and find creative ways to perform their
tasks.

The Theory X assumes that the lower order needs motivate individuals, while
Theory Y assumes that people are motivated by the higher order needs. The
Theory Y manager will introduce participation and decision making, offer
responsible and challenging jobs, and good group relations will motivate
employees.

McCLELLAND’s NEED ACHIEVEMENT THEORY:

It proposed 3 major needs in the workplace:

A. The need for achievement i.e. Drive to excel, to strive to succeed and to
achieve, relative to a set of standards.

B. The need for power i.e. to make others behave as you want them.
C. The need for affiliation. i.e.: The need for close and friendly interpersonal
relationships.

High achievers will try to do things better than others. They will take
responsibility for finding solutions to problems and look for challenging
situations, irrespective of success or failure.

People who enjoy having an impact and controlling others have a high need
for power. They prefer status oriented situations and will look at ways of
influencing others, rather than performing effectively.

Individuals with a high need of affiliation will prefer cooperative situations,

rather than competitive ones, and work for relationships involving a high
degree of mutual understanding.

Motivation = Desire * Belief.

TRANSACTIONAL ANALYSIS

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A stroke is a unit of recognition of another person. Strokes can be physical
and psychological. They can be either positive or negative. Physical positive
strokes include a pat on a back; worm handshake etc. physical negative
strokes include a slap, a push. Psychological positive strokes include
appreciation; praise etc. psychological negative strokes include criticism,
back – biting etc.

There are 3 ego states. The Parent, the Adult and the Child. These 3 ego states
determined our behaviour in any situation.

The parent ego state is primarily behaviour copied from our parents, teachers
and elders. It can be of 2 types:

A. Critical Parent: Finding fault, demanding explanations etc.

B. The Nurturing Parent: State is seen in behaviour that shows concern for
the other.

The adult ego state is seen in behaviour that is rational and based on logic and
fact.

The child ego state is usually impulsive, fun living and includes behaviour
that is picked up in our childhood.

A transaction occurs when there is a response to a stimulus (stroke).

Complementary Transactions occur when I get desired response. E.g.: My

boss allows me to take leave before exam.

Crossed Transactions occur when I do not get the expected response. E.g.: I
ask for directions on the road.

Ulterior Transactions imply that something is hidden behind the word used.

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A Game is a situation that involves 2 or more persons in which there are
several complementary transactions, some crossed transactions and some
ulterior transactions.

HOW TO CONTROL A GAME

The first step is to become aware of the game and that it has negative impact
(Pay Off) on the persons involved. E.g.: The family game creates feelings of
anger, distrusts and even hatred for one another. While, NIGYSOB is about
looking for opportunities to get revenge. Games played from ego state become
Parent Games, Adult Games and Child Games.

However games prevent healthy relationships in organization. It leads to

organizational politics and interpersonal conflicts. We need to control the
game in order to have healthy workplace.

We must train people in the area of Transactional Analysis so that they can
find a suitable work environment. There needs to be give and take policy in
addition to free flow of communication.

Read: Games People Play by Dr Eric Berne

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 TEAMS AND GROUP DYNAMICS

TYPES OF TEAMS:
The work team is a group that interacts primarily to share information and to
make decisions to help increase performance within each member’s area of
responsibility. It generates positive synergy through coordinated team effort.
The individual efforts result in a level of performance that is greater than the
sum of the individual inputs.

The types of teams classify on the basis of their objectives:

A. Problem Solving Teams:
These teams were composed of 5 to 12 persons who met weekly to discuss
ways to improve quality, efficiency and work environment. They secured
ideas or offered suggestions to improve work environment. They shared
ideas or offered suggestions to improve work processes. However, they
were not given the authority to implement their suggestions. Management
retains control over the final implementation. Today, organizations used
problem solving teams as a way to improve quality, speed up delivery,
eliminate scrap, reduce accident rates and generally cut costs.

B. Cross - Functional Teams:

They are mode of people from the same level of the organization but from
different work areas, who come together to accomplish the task. E.g.:
Toyota, Ford, GM, BMW used cross – functional teams to coordinate
complex projects. Cross functional teams allow people from diverse areas
within the organization or even across organization to exchange
information, develop new ideas, solve problems and coordinate complex
projects. The early stages of development are often time consuming as
people have to learn to work with diversity, to build up trust and teamwork
especially among people from different backgrounds within different
experience and perspectives.

C. Self Managed Work Teams:

Generally composed of 10 – 15 people, their responsibilities include
determining work assignments, controlling pace of work, organizing their

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 breaks and collective choice of inspection procedures. As a result,
supervisory positions decrease in importance and may even be eliminated.
Employees in self managed work teams, usually have higher level of job
satisfaction, but also show higher absenteeism and higher turnover.

D. Virtual Work Teams:

People in different locations use computer technology to share
information, make decisions and work on complete projects. However,
team members have less direct social interaction and so hey tend to be
more tasks oriented and less on social rapport.

CREATING EFFECTIVE WORK TEAMS:

Effective teams have certain common characteristics. The members should
have freedom and autonomy, the ability to complete a task, the opportunity to
utilize different skills and talents and to do work that has substantial impact
on others. Teams require people with technical expertise as well as problem
solving, decision making and interpersonal skills and high scores on
extroverted, agreeableness, conscientiousness and emotional stability.
Effective teams are neither too larger nor too small (5 – 12 people). The
members must be committed to a common purpose, specific team goals, have
adequate resources, believe in team’s capability, a manageable level of
conflict and minimal degree of social loafing.

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 CONFLICT AND NEGOTIATION

WHAT IS CONFLICT? :
When a person A deliberately and consistently makes efforts to block the
efforts of person B, we have a conflict situation. Person B experiences
frustration and anger.

Responses to conflict:
A. Avoiding:
It is the response that we use when the issues are not very important. It is
also done to maintain the peace. However, too much of this response can
cause buildup of anger and frustration.

B. Accommodating:
This is supposed to be a 50 – 50 response where both sides look for ways
to adjust. However, most accommodation is usually one sided. e.g.: Going
on a holiday, completing an office report etc.

C. Confrontation:
It is the usual human response in which one person wins at the cost of the
other. In an office environment, this may be seen in withholding
information that others require, using delaying tactics, playing games etc.

D. Collaborating:
This is the ideal response. We look for win – win solutions, so that both
the parties feel satisfied.

Conflict is inevitable and sometimes it can lead to better relationships and

improved functioning.

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NEGOTIATION:
Negotiation is a process in which two or more parties exchange goods or
services and attempt to agree on the exchange rate. To improve our
effectiveness at negotiating, we use following steps:

A. Research your opponent:

Acquire as much information as possible about his / her interests, goals
and strategy. This will help you to understand his behaviour, predict his /
her responses and frame solutions in terms of his interests.

B. Begin with a positive gesture:

Give a small concession which will lead to an agreement.

C. Address the problem. Not the individual.

D. Pay little attention to initial offers.

E. Emphasize win – win solutions.

F. Create an open and trusting climate.

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 POWER AND POLITICS

POWER:
Power refers to the capacity that person ‘A’ has to influence the behaviour of
‘B’ so that ‘B’ does something that he or she would otherwise not do.

Legitimate Power:
In an organization, legitimate power is the result of one’s designation within
the organization.
It will include reward and coercive power.
Coercive Power is dependent on fear, especially of negative results that
might occur. e.g.: pain, force, unpleasant risks, dismissal, suspension,
demotion etc.

Reward Power:
When I do something that produces positive benefits and the other person has
the power to reward me. e.g.: money, promotion, interesting work
assignments, important information, preferred work locations / shifts,
favorable performance appraisals, then your ability to give that reward gives
power over that individual.

Expert Power:
It is the influence that comes as result of expertise, special skills or
knowledge. Expertise has become one of the world’s most influential sources
of power. As jobs become more specialized, we are increasingly dependent on
experts. e.g.: Doctors, computer specialists, lawyers etc.

Referent Power:

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Develops out of admiration of another person and a desire to be like him / her.
In organizations, people want to be like the charismatic leader. It is also about
using the influence of the manager to achieve one’s purposes.

POLITICS IS POWER IN ACTION:

Politics is defined as those activities that are not required as part of one’s
formal job role, but which attain to influence the distribution of advantages
and disadvantages within the organization.

LEADERSHIP THEORY / STYLES

TRAIT THEORY:
It was presumed that a leader has certain traits and qualities, and therefore a
person who wanted to be a leader, must possess those traits. Six traits
commonly associated with leadership:

A. Drive And Ambition.

B. Desire To Lead.
C. Honesty And Integrity.
D. Intelligence.
E. Self Confidence.
F. In-depth Technical Knowledge in the Area Of Responsibility.

GREAT MAN THEORY:

This refers to the idea that a king is a good leader and therefore his children
will be good leaders. This theory has not held up, as seen in history and in
modern democracies.

LEADERSHIP STYLES RANGE FROM -

AUTOCRATIC: i.e.: one who is always right and does not allow others to
express their opinions. The autocratic leader gets things done without
considering the impact on people. He / she is responsible for higher employee
turnover and may encourage politics in the workplace.

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DEMOCRATIC:
Democratic leaders encourage all subordinates to take part in discussions.
They are seen as fair and just. Sometimes, they may take more time to arrive
at decisions.

LAISSEZ – FAIRE:
This type of leadership is actually no leadership at all. The leader here does
not interact with the team and allows them to do as they like.

SITUATIONAL LEADERSHIP:
Situational leadership is based on the fact that we must adapt ourselves to the
situation. This type is also dependent on level of the followers. I.e.: On their
competence, experience etc.
ORGANIZATIONAL STRUCTURE

An organizational structure defines how jobs are formally divided, on the

basis of 6 key elements that we need to address when we design
organizational structure.

The degree to which tasks are subdivided in separate Work Specialization

jobs
The basis on which jobs will be grouped together Departmentalization
The reporting structures for individuals and groups. Chain of command
The number of individuals that a manager can Span of control
efficiently and effectively direct.
The degree to which rules and regulations exist to direct Formalizations
employees and mangers
Who makes the decision? Centralization vs.
Decentralization

WORK SPECIALIZATION:

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Division of labour increases efficiency and productivity because it is easier
and less costly to find and train workers to do specific and repetitive tasks
than to do many jobs. E.g.: McDonalds

DEPARTMENTALIZATION:
It can be on different basis:

A. By Function:
E.g.: Production, accounts, HR, IT etc.
B. By Product:
E.g.: Proctor & Gamble has skin care, home care, personal care etc.
C. By Geography:
E.g.: East, west, north, south, Asia Pacific, Middle East etc.
D. By Process:
Based on type of work. I.e.: Different types of processes.
E. By Customer:
E.g.: Insurance, corporate retail.

CHAIN OF COMMAND:
Who am I responsible to? Authority refers to the right of a manger to give
orders and expect those orders to be obeyed. The unity of command principle
says that a person should have one and only one reporting manager to whom
he is directly responsible.

SPAN of CONTROL:
It determines the number of levels and managers in organization. The trend
today is towards larger spans of control. In order to reduce cost, cut
overheads, increase flexibility and speed up decision meeting. A small span of
control i.e.: 5 to 6 employees allows the manager to maintain close control.

FORMALIZATION:

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The greater the standardization, less freedom that employees have to make
decision. Everything has a clearly defined procedure. There are clear job
descriptions and lots of rules.

CENTRALIZATION:
In a decentralized organization, action can be taken more quickly to solve
problems. More people can give inputs and feel less alienated from decisions.

TYPES OF STRUCTURES:
A. Simple Structure:
There is a low degree of departmentalization, wide span of control and
very little formalization. It is usually a flat organization with 2 – 3 levels
and one individual who makes the decisions. E.g.: Family business. As the
size increases to more than 50 people, decision making becomes slower.

B. The Bureaucracy:
Highly routine tasks are carried out through specialization, much
formalized rules and regulations, functional departments, centralized
authority, narrow spans of control and decision making that follows chain
of command. However, there will be some unit conflicts and excessive
focus on rules. E.g.: Govt. organizations.

C. The Matrix Structure:

It combines 2 forms of departmentalization. I.e.: Functional and product.
Grouping the specialists allows us to solve problems and share the
resources across products. However, it is difficult to coordinate their work
in order to ensure they meet budget constraints and product deadlines.
Employees have two bosses: the functional department manager and
product manager. This structure creates confusion, increases power
struggle and stress for individual.

D. Team Structure:
It breaks down departmental barriers, achieving efficiency of bureaucracy,
but maintaining flexibility of team.

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E. Virtual Organization:
Outsourcing major business functions. Nike designs shoes and
manufactures them elsewhere. Major advantage is flexibility as managers
here spend most of their time coordinating external relations, usually on
computer.

IMPLICATION:
An organization structure clarifies relationships and reduces ambiguity.
However, organizations having high level of formalization and specialization,
limited delegation of authority and narrow span of control give very little
autonomy to employees. The organization’s internal structure will explain and
predict the human behaviour.

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