Chapter 1: Dynamics of People and Organizations

Organizational Behavior - is the systematic study and careful application of knowledge

about how people as individuals and as groups act within the organization.
Goals of organizational behavior:
a. Describe – how people behave under variety of conditions
b. Understand – why people behave as they do
c. Predict – future behavior
d. Control –

Key forces that affect OB

a. People – make up the internal social system of the organization. It consists of

individuals and groups.
b. Structure – defines the formal relationship and use of people in the organization.
c. Technology – provides the resources with which people work, its has significant
influence on working relationships
d. Environment – all organizations operate with internal and external environment
organizations does not exist alone, its part of a larger system that contains many
other elements such as:
a. Government
b. Family
c. Community.. etc

Fundamental concepts of OB
Nature of People
a. Individual Differences – each person is different
b. Perception – we look at the world and see things differently
c. A whole person concept – although organizations may wish they could employ only a
person’s skills or brain, they actually amply the whole person rather than certain
characteristics
d. Motivated behavior – people are motivated not by what we think they ought to have
but by what they themselves want.
e. Desire for involvement – people seek opportunities at work and become involved in
relevant decisions, thereby contributing their talents and ideas to the organizations’
success.
f. Value of a person – people deserve to be treated better because they are of higher
order in the universe, they are not economic tools.
The nature of organizations
a. Social systems – organizations are social systems, they are formed on the basis of
mutual interest and must be treated ethically. Organizations are governed by social
laws as well as psychological laws. People behavior is influenced by their group as
well as individual drives.
b. Mutual interest – organizations need people and people need organizations
c. Ethics – is the use of moral principles and values to affect the behavior of individuals
and organizations with regard to choices between who is right and wrong.
Limitations of Organizational Behavior
a. Bahavioral bias – concern for employees can be so greatly overdone that the original
purpose of bringing people together – productive organizational outputs for society is
lost
b. The law of diminishing returns – at some point, increases in desirable practice
produce declining results
c. Un ethical manipulation of people – lack of respect for basic human dignity for use of
selfish ends

Management reading:
Two management consultants, Dough Lennick and Fred Keil define moral intelligence
as “the ability to differentiate right from wrong as defined by universal principles”. A combination
of behavior and smarts, moral intelligence builds on universal virtues to help leaders achieve
personal and business goals. The authors argue that behaving morally is no only right, but also
good for business.
With a premise that people are “born to be moral”, Lennick and Kiel suggest that four
key elements underline moral intelligence:
Integrity – acting consistently with one’s values
Responsibility – willingness to accept accountability for the consequences of our actions
and admit mistakes and failures
Compassion – caring about others
Forgiveness – recognizing that others will make mistakes and accepting them
These four elements can become competencies if managers proceed through a three-
step process encompassing self-awareness, self-disclosure and discovery of strengths and
weakness in others.