Unit-1

Organizational Behavior - Introduction

Organizational Behavior (OB) can be defined as the understanding, prediction and management
of human behavior both individually or
o r in a group that occur within an organization.

Internal and external perspectives are the two theories of how organizational behavior can be
viewed from an organizations point of view. In this tutorial, we will be learning in detail about
both the theories.

Importance of OB
!hile wor"ing in an organization, it is very important to understand others behavior as well as
ma"e others understand
understand ours. In order to maintain
maintain a healthy
healthy wor"ing
wor"ing environment,
environment, we need to
adapt to the environment and understand the goals we need to achieve. #his can be done easily
if we understand the importance of OB.

$ollowing points bring out the importance of OB %

 It helps in explaining the interpersonal relationships employees share with each other as
well as with their higher and lower subordinates.

 #he prediction of individual behavior can be explained.

 It bala
balanc
nces
es the
the cord
cordia
iall rela
relati
tion
onsh
ship
ip in an ente
enterp
rpri
rise
se by main
mainta
tain
inin
ing
g effe
effect
ctiv
ivee
communication.

 It assists in mar"eting.

 It helps managers to encourage their sub&ordinates.

 'ny change within the organization can be made easier.

 It helps in predicting human behavior  their application to achieve organizational goals.

 It helps in ma"ing the organization more effective.

#hus studying organizational behavior helps in recognizing the patterns of human behavior and
in turn throw light on how these patterns profoundly influence the performance of an
organization.

Organizational Behavior - Determinants

#here are three maor factors that affect OB. #he wor"ing environment being the base for all
three factors, they are also "nown as the determinants of OB. #he three determinants are %

 *eople

 +tructure

 #echnology

*eople

'n organization consists of people with different traits, personality, s"ills, ualities, interests,
bac"ground, beliefs, values and intelligence. In order to maintain a healthy environment, all the
employees should be treated eually and be udged according to their wor" and other aspects
that affects the firm.

Example % ' company offers campus placement to trainees from different states li"e Orissa,
-aryana, 'runachal *radesh and many more. -owever, during and after training, all trainees are
examined only on the basis of their performance in the tas"s assigned.
Organizational +tructure

+tructure is the layout design of an organization. It is the construction and arrangement of

relationships, strategies according to the organizational goal.

Example % Organizational structure defines the relation of a manager with employees and co&
wor"ers.

#echnology

#echnology can be defined as the implementation of scientific "nowledge for practical usage. It
also provides the resources reuired by the peo ple that affect their wor" and tas" performance in
the right direction.

Example % Introduction of +'*, big data and other software in the mar"et determines
individual and organizational performance.

nvironment

'll companies function within a given internal and external environment. Internal environment
can be defined as the conditions, factors, and elements within an enterprise that influences the
activities, choices made by the firm, and especially the behavior of the employees. !hile
external environment can be defined as outside factors that affect the company/s ability to
operate. +ome of them can be manipulated by the companys mar"eting, while others reuire
the company to ma"e adustments.

+ome examples of internal environment include employee morale, culture changes, financial
changes or issues, and some examples of external environment include political factors,
changes to the economy and the company itself.

Organizational Behavior - Concepts

#he concept of OB is based on two "ey elements namely %

 0ature of people

 0ature of the organization

0ature of *eople

In simple words, nature of people is the basic ualities of a person, or the character that
personifies an individual they can be similar or uniue. #al"ing at the organizational level, some
maor factors affecting the nature of people have been highlighted. #hey are %

 Individual Difference % It is the managerial approach towards each employee

individually, that is one&on&one approach and not the statistical approach, that is,
avoidance of single rule. Example % 1anager should not be biased towards any
particular employee rather should treat them eually and try not to udge anyone on any
other factor apart from their wor".

 Perception % It is a uniue ability to observe, listen and conclude something. It is

believing in our senses. In short, the way we interpret things and have our point of view
is our perception. Example % 'man thin"s late night parties spoil youth while 'nami"a
thin"s late night parties are a way of ma"ing new friends. -ere we see both 'man and
'nami"a have different perception about the same thing.

  !hole person % 's we all "now that a persons s"ill or brain cannot be employed we
have to employee a whole person. +"ill comes from bac"ground and "nowledge. Our
personal life cannot be totally separated from our wor" life, ust li"e emotional
conditions are not separable from physical conditions. +o, people function is the
functioning of a total human being not a specific feature of human being.

 "otivated #ehavior % It is the behavior implanted or caused by some motivation from

some person, group or even a situation. In an organization, we can see two different
types of motivated employees %

o Positive motivation % ncouraging others to change their behavior or say

complete a tas" by luring them with promotions or any other profits. xample %
2If you complete this, you will gain this.3

o $egative motivation % $orcing or warning others to change their behavior else

there can be serious conseuences. xample % 2If you dont complete this, you
will be deprived from the office.3
  %alue of person % mployees want to be valued and appreciated for their s"ills and
abilities followed by opportunities which help them develop themselves.

0ature of Organization

0ature of organization states the motive of the firm. It is the opportunities it provides in the
global mar"et. It also defines the employees standard4 in short, it defines the character of the
company by acting as a mirror reflection of the company. !e can understand the nature of any
firm with its social system, the mutual interest it shares and the wor" ethics.

5et us ta"e a uic" loo" at all these factors %

 &ocial s'stem % very organization socializes with other firms, their customers, or
simply the outer world, and all of its employees & their own social roles and status. #heir
behavior is mainly influenced by their group as well as individual drives. +ocial system
are of two types namely %

o (ormal % 6roups formed by people wor"ing together in a firm or people that

belong to the same club is considered as formal social s'stem . Example % '
success party after getting a proect.

o Informal % ' group of friends, people socializing with others freely, enoying,
partying or chilling. Example % Birthday party.

 "utual interest % very organization needs people and people need organizations to
survive and prosper. Basically its a mutual understanding between the organization and
the employees that helps both reach their respective obectives. Example % !e deposit
our money in the ban", in return the ban" gives us loan, interest, etc.

 Ethics % #hey are the moral principles of an individual, group, and organization. In order
to attract and "eep valuable employees, ethical treatment is necessary and some moral
standards need to be set. In fact, companies are now establishing code of ethics training
reward for notable ethical behavior.

Organizational Behavior - &cope

In a very broad sense, the scope of OB is the extent to which it can govern or influence the
operations of an organization. #he scope of OB integrates 7 concepts respectively %

Individual Behavior

It is the study of individuals personality, learning, attitudes, motivation, and ob satisfaction. In
this study, we interact with others in order to study about them and ma"e our perception about
them.

Example % #he personal interview round is conducted to interact with candidates to chec" their
s"ills, apart from those mentioned in the resume.

Inter&individual Behavior

It is the study conducted through communication between the employees among themselves as
well as their subordinates, understanding peoples leadership ualities, group dynamics, group
conflicts, power and politics.

Example % ' meeting to decide list of new board members.

6roup Behavior

6roup behavior studies the formation of organization, structure of organization and

effectiveness of organization. #he group efforts made towards the achievement of organizations
goal is group behavior. In short, it is the way how a group behaves.

Example % +tri"e, rally etc.

Organizational Behavior - "odels

Organizational behavior reflects the behavior of the people and management all together, it is
considered as field study not ust a discipline. ' discipline is an accepted science that is based
upon theoretical foundation, whereas OB is an inter&disciplinary approach where "nowledge
from different disciplines li"e psychology, sociology, anthropology, etc. are included. It is used
to solve organizational problems, especially those related to human beings.

#here are four different types of models in OB. !e will throw some light on each of these four
models.
utocratic "odel

#he root level of this model is power with a managerial orientation of authority. #he employees
in this model are oriented towards obedience and discipline. #hey are dependent on their boss.
#he employee reuirement that is met is subsistence. #he performance result is less.

#he maor drawbac"s of this model are people are easily frustrated, insecurity, dependency on
the superiors, minimum performance because of minimum wage.

Custodial "odel

#he root level of this model is economic resources with a managerial orientation of money. #he
employees in this model are oriented towards security and benefits provided to them. #hey are
dependent on the organization. #he employee reuirement that is met is security.

#his model is adapted by firms having high resources as the name suggest. It is dependent on
economic resources. #his approach directs to depend on firm rather than on manager or boss.
#hey give passive cooperation as they are satisfied but not strongly encouraged.

&upportive "odel

#he root level of this model is leadership with a managerial orientation of support. #he
employees in this model are oriented towards their ob performance and participation. #he
employee reuirement that is met is status and recognition. #he performance result is awa"ened
drives.

#his model is dependent on leadership strive. It gives a climate to help employees grow and
accomplish the ob in the interest of the organization. 1anagement ob is to assist the
employees ob performance. mployees feel a sense of participation.

Collegial "odel

#he root level of this model is partnership with a managerial orientation of teamwor". #he
employees in this model are oriented towards responsible behavior and self&discipline. #he
employee reuirement that is met is self&actualization. #he performance result is moderate zeal.

#his is an extension of supportive model. #he team wor" approach is adapted for this model.
+elf&discipline is maintained. !or"ers feel an obligation to uphold uality standard for the
better image of the company. ' sense of 2accept3 and 2respect3 is seen.
E"E)*I$* +)E$D& I$ O)*$I,+IO$ BE.%IO)/

#here are several trends in Organizational Behavior. One trend is globalization.

6lobalization reuires corporate decision ma"ers to be more sensitive to cultural differences as
they venture towards a wider variety of employees and clients. 'nother trend in organizations is
the increasingly diverse wor"force. 8iversity potentially improves decision&ma"ing, team
performance, and customer service, but it also presents new challenges for the company. #he
values and ethics of the employees, enable organizations to apply certain principles in a global
environment, and are under pressure to abide by the ethical values and higher standards of
corporate social responsibility.

*eriodically throughout an organization/s life, leaders refine the purpose and direction of
their organization/s trends according to9based on what the current needs are. In considering their
organization/s mission and vision, managers usually use information about the organization/s
performance and trends in the business environment (mar"et shifts, changes in customer needs,
advances in technology, demographic patterns, new government regulations) to guide their way
of thin"ing that is more in line with current trends.

"$*I$* CU+U) DI%E)&I+0

:ultural diversity is a form of appreciating the differences in individuals. #he differences can be
based on gender, age, sex, ethnicity, sexual orientation, and social status. :ompanies have
realized the value in acuiring a diverse wor"force.

:ultural 8iversity 8efinition

:&#ransport is an aviation company that manufactures airplanes. #he reason for the company/s
success has to do with their employees. :&#ransport depends on wor"er diversity to bring the
aircraft to fruition. Diversit' consists of all the different factors that ma"e up an individual,
including age, gender, culture, religion, personality, social status and sexual orientation.

Cultural diversit' (also "nown as multiculturalism ) is a group of diverse individuals from

different cultures or societies. ;sually, cultural diversity ta"es into account language, religion,
race, sexual orientation, gender, age and ethnicity. :ompanies started to embrace corporate
diversity in the early <===s. #his was due to many trends in demographics and a changing
wor"force.
Cultural Diversit' +rends

>. The growth of a minority workforce.

#oday/s wor"force is made up of a very diverse population of individuals from every part of the
world, which creates dynamic multiracial and multicultural organizations. +uch diversity brings
with it many differences in s"ills, abilities and experiences

<. The second trend is a growth of stereotyping and prejudices.

#his can be hard to avoid when so many different cultures come together in a wor" environment.

7. Another trend companies are embracing is the addition of sensitivity or diversity training.

#his type of training educates all employees abo ut cultural differences so that they can
understand and appreciate each other. #he purpose of sensitivit' training is to teach employees
how to properly act and communicate in a corporate environment. #opics covered in a sensitivity
training session will include learning proper etiuette, appropriate terminology, improvement of
communication s"ills, anti&bullying management styles and how to eliminate sexual harassment
within a company..

?. The fourth trend is a large increase of females in the workforce.

In fact, over the past few decades, women/s participation in the wor"force has grown
dramatically to account for almost half of the labor force

"$*I$* +.E PE)CEP+IO$ P)OCE&&

Perceptual Process
Perceptual process are the different stages of perception we go through.
The different stages are −

 Receiving

 Selecting

 Organizing

 Interpreting
Receiving
Receiving is the first and most important stage in the process of perception.
It is the initial stage in which a person collects all information and receives
the information through the sense organs.

Selecting
Selecting is the second stage in the process. Here a person doesn’t receive
the data randoml !ut selectivel. " person selects some information out of
all in accordance with his interest or needs. The selection of data is
dominated ! various e#ternal and internal factors.

 External factors − The factors that influence the perception of an

individual e#ternall are intensit$ size$ contrast$ movement$
repetition$ familiarit$ and novelt.

 Internal factors − The factors that influence the perception of an

individual internall are pschological re%uirements$ learning$
!ac&ground$ e#perience$ self'acceptance$ and interest.

Organizing
(eeping things in order or sa in a snchronized wa is organizing. In order
to ma&e sense of the data received$ it is important to organize them.

)e can organize the data ! −

 *rouping them on the !asis of their similarit$ pro#imit$ closure$

continuit.

 +sta!lishing a figure ground is the !asic process in perception. Here

! figure we mean what is &ept as main focus and ! ground we
mean !ac&ground stimuli$ which are not given attention.

 Perceptual constanc that is the tendenc to sta!ilize perception so

that conte#tual changes don’t affect them.
Interpreting
,inall$ we have the process of interpreting which means forming an idea
a!out a particular o!-ect depending upon the need or interest.
Interpretation means that the information we have sensed and organized$ is
finall given a meaning ! turning it into something that can !e
categorized. It includes stereotping$ halo effect etc.