MCOB Notes Final

UNIT-1
INTRODUCTION TO MANAGEMENT
Management is a universal phenomenon. It is a very popular and widely used term. All organizations,
business, political, cultural or social are involved in management because it is the management that
helps and directs the various efforts towards a definite purpose.
Definition: “Management is known exactly what you want men to do and then seeing that they do it the
best and cheapest ways”.
-F.W.Taylor
“Management is an art of getting things done through and with the people in formally organized groups.
It is an art of creating an environment in which people can perform and individuals and can cooperate
towards attainment of group goals”.
Koontz and O’Donell
Nature of Management: The study and application of management techniques in managing the affairs
of the organization have changed its nature over the time.
1. Multidisciplinary: Combines knowledge from various fields like economics, sociology,
psychology, and mathematics.
2. Dynamic: Adapts to changes in the environment, technology, and societal values.
3. Universal: Applicable to all types of organizations, regardless of their size or nature.
4. Goal-oriented: Focuses on achieving organizational objectives efficiently and effectively.
Characteristics of Management:
Management is an activity concerned with guiding human and physical resources such that
organizational goals can be achieved. Nature of management can be highlighted as: -
1. Management is Goal-Oriented.
2. Management integrates Human, Physical and Financial Resources.
3. Management is Continuous Process.
4. Management is all Pervasive.
5. Management is a Group Activity.
FUNCTIONS OF MANAGEMENT
According Luther Gullick a keyword ’POSDCORB’ where P stands for Planning, O for Organizing, S
for Staffing, D for Directing, Co for Co-ordination, R for reporting & B for Budgeting explain the
functions of management. But the most widely accepted are functions of management given by Koontz
and O’Donnel i.e. Planning, Organizing, Staffing, Directing and Controlling.
MCOB (MBA 1st Semester)

1 Planning:-
Planning is the foundational function of management, involving the formulation of future
actions and deciding in advance the best course to achieve pre-determined objectives.
According to Koontz, "Planning is deciding in advance - what to do, when to do & how to
do. It bridges the gap from where we are & where we want to be." A plan outlines future
actions and serves as a guide for problem-solving and decision-making. It entails
systematic thinking about methods and means to accomplish set goals, ensuring the
efficient use of resources.
2 Organizing:-
Organizing involves assembling physical, financial, and human resources and establishing
productive relationships among them to achieve organizational goals. Henry Fayol defined
organizing as providing everything necessary for the business's functioning, such as raw
materials, tools, capital, and personnel. The organizing process includes identifying
activities, classifying and grouping activities, assigning duties, delegating authority,
creating responsibilities, and coordinating relationships between authority and
responsibility.
3 Staffing
Staffing is the function of filling and keeping the organization structure manned.
According to Koontz & O'Donnell, "Managerial function of staffing involves manning the
organization structure through proper and effective selection, appraisal & development of
personnel to fill the roles designed in the structure." Staffing encompasses manpower
planning, recruitment, selection, placement, training, development, remuneration,
performance appraisal, and promotions and transfers.
4 Directing:-
Directing is the managerial function that activates the organizational methods to achieve
goals. It is the driving force that initiates action, turning planning, organizing, and staffing
into productive efforts. Directing involves influencing, guiding, supervising, and
motivating subordinates.
5 Controlling:-
Controlling involves measuring actual performance against established standards and
correcting deviations to ensure organizational goals are met. Its purpose is to ensure that
everything occurs in alignment with plans and standards. An effective control system can
predict deviations before they happen. According to Koontz & O'Donnell, "Controlling is
the measurement & correction of performance activities of subordinates in order to make
sure that the enterprise objectives and plans desired to obtain them are being
accomplished."
Levels of Management

The term "Levels of Management" refers to the distinct layers of managerial positions within an
organization. The number of management levels tends to increase with the growth in the size of the
business and its workforce, and decrease accordingly. These levels establish a chain of command and
define the authority and status associated with each managerial role. Management levels are generally
classified into three broad categories:
Theories of Management
A. Classical Theory of Management
1. Scientific Management
Scientific management theory, pioneered by Frederick Winslow Taylor in the late 19th century,
transformed work efficiency. It emphasizes the scientific analysis of tasks to boost productivity,
efficiency, and organizational workflow. By standardizing methods and incorporating both workers and
managers in the decision-making process, it seeks to eliminate inefficiencies. Taylor's principles, which
have significantly shaped modern management theories, still impact industries today.

Replace the “rule of
thumb” with science and
Principles of Scientific
standardization
Management
The Right Person for the
Job
Proper Division of Work

Between Workers and
Managers
Collaboration Between
Workers and Managers
2. Administrative Theory
In the last century, organizations have always had to manage their operations effectively. By the early
1900s, large entities like production factories required structured management. At that time, there were
few external tools, models, or methods available. These early concepts, known as principles, were
fundamental to successful management. Henri Fayol explored these extensively, leading to his
formulation of the 14 principles of management. His research and principles were published in the book
"General and Industrial Management" in 1916.
14 Principles of management
Henri Fayol was able to synthesize 14 principles of management after years of study, namely:
1. Division of Work: Specialization enhances workforce efficiency, productivity, accuracy, and speed
in both technical and managerial tasks.
2. Authority and Responsibility: Management holds the authority to give orders and the
responsibility for performance, ensuring accountability and efficiency.
3. Discipline: Essential for smooth operations, discipline involves obedience, good conduct, and
respectful interactions as part of core organizational values.
4. Unity of Command: Each employee should receive orders from one manager to avoid confusion
and conflict, ensuring clear responsibility.
5. Unity of Direction: All employees should work toward common objectives with coordinated
efforts, guided by a unified plan of action.
6. Subordination of Individual Interest: Organizational objectives take precedence over personal

interests at all levels, promoting overall effectiveness.

7. Remuneration: Adequate compensation, both monetary and non-monetary, is crucial to keep
employees motivated and productive.
8. Degree of Centralization: Decision-making authority should be balanced between top

management and lower levels, depending on the organization's size and hierarchy.
9. Scalar Chain: A clear hierarchical line of authority from top to bottom should be maintained,
allowing emergency communication without bypassing the hierarchy.
10. Order: Employees should have the necessary resources and a safe, clean work environment to
function properly.
11. Equity: Employees must be treated fairly, kindly, and impartially, ensuring they are in the right
roles for optimal performance.
12. Stability of Tenure of Personnel: Minimizing employee turnover and ensuring the right staff are
in the right positions is crucial for organizational stability.
13. Initiative: Encouraging employees to express new ideas fosters engagement, involvement, and
added value for the company.
14. Esprit de Corps: Fostering unity and morale among employees enhances communication, trust,
and overall organizational culture.
3. Max Weber bureaucratic theory
Principles of Bureaucratic Theory
 Job Specialization: Tasks are divided into simple, routine, and fixed categories based on skills and
specialization.
 Authority Hierarchy: A structured hierarchy where higher-ranking officers control subordinates,

ensuring oversight and performance management.
 Formal Selection: Organizational members are chosen based on technical qualifications and
demonstrated competency through training, education, or examinations.
 Formal Rules and Regulations: Managers rely on formal rules and regulations to ensure uniformity
and regulate employee actions, fostering impersonality in relationships.
 Impersonality: Uniform application of rules avoids favoritism, nepotism, and personal preferences in
managerial decisions.
Limitations of Bureaucratic Theory
 Neglect of Informal Relationships: Does not consider informal interactions among employees.
 Outdated Control System: The rigid control and authority system is outdated and unsuitable for
dynamic environments.
 Inadequate Conflict Resolution: Lacks effective mechanisms to resolve conflicts between

functional groups.
Hawthorne Experiments and Elton Mayo's Contributions
In 1927, Elton Mayo and Fritz Roethlisberger led studies at the Hawthorne Works of Western Electric
Company to understand productivity beyond physical conditions and wages.
 Illumination Experiment: Examined the relationship between lighting and output, concluding that
factors other than illumination affect productivity.
 Relay Assembly Test Room Experiment: Investigated the effects of working conditions, finding
that socio-psychological factors like recognition and group dynamics significantly boost
productivity.
 Mass Interview Programme: Studied employee attitudes, revealing that social factors in the work
environment are crucial.
 Bank Wiring Test Room Experiment: Explored social groups and production norms, discovering
that workers set their own production standards, often lower than management's, to maintain group
cohesion.
B. MODERN APPROACH
Systems Approach to Management: Key Features

 Interacting Elements: A system is composed of interrelated and interdependent parts arranged to
form a cohesive whole.
 Interrelationships: The sub-systems within a system should be examined in relation to each
other, rather than in isolation.
 Boundaries: An organizational system has defined boundaries that distinguish internal parts
from external elements.
 Inputs and Outputs: A system interacts with its environment by receiving inputs of information,
materials, and energy, transforming them internally, and producing outputs for other systems.
 Dynamic Nature: Organizations are dynamic systems, responsive to environmental changes and
susceptible to external influences.
Contingency Approach to Management: Key Features
 Situational Management: Management techniques vary based on the complexity of the situation;
effectiveness depends on the specific context.
 Non-Universal Principles: Management principles are not universally applicable; there is no
single best management style, as effective management is situational.
 Multivariate Focus: Emphasizes understanding the complex, multivariate nature of
organizations, enabling them to operate effectively under different environmental conditions.
Solutions are tailored to specific circumstances, with the same problem potentially having
different solutions at different times, and different problems possibly having the same solution
at a given time.
 Environmental Adaptability: Highlights the organization's ability to adapt to both internal and
external environments, fitting its internal environment to external conditions.
UNIT-2
PLANNING AND ORGANIZING
PLANNING
Planning is the process managers use to identify and select organizational goals and the actions needed
to achieve them. It involves deciding in advance what to do, how to do it, when to do it, and who will do
it. Planning serves as a bridge from the present to the desired future state, requiring forward-thinking and
visualization of future actions organized logically.
Principles of Planning
Effective planning is crucial for the success and longevity of any organization. Failures often occur not
due to a lack of planning, but due to ineffective planning. Understanding the following principles
enhances planning effectiveness and helps avoid common managerial mistakes:
 Systematic Planning: Structured and systematic planning is essential for organizational success.
 Forward-Looking: Planning must be forward-looking, bridging the gap between the current
state and future goals.
 Logical Organization: Planning involves logically visualizing and organizing future courses of
action.
STEPS IN PLANNING
Though there may be a few variations in the exact procedure adopted by different organizations in
planning, the following are the broad steps:
1. Setting Objectives
Planning begins with defining the organization's goals clearly. Major objectives are first specified and
then broken down into departmental and individual targets. Objectives guide decision-making, resource
allocation, and work schedules, anticipating potential problems and opportunities. For instance, if ABC
Ltd. aims to sell 3,000 laptops this year, doubling last year's sales, this goal must be distributed across
production, marketing, sales, and finance departments for better management.
2. Developing Planning Premises
The next step is to establish the environment in which plans will operate, known as planning premises.
These include assumptions and forecasts about future conditions that will affect the plan's execution.
Premises are categorized into internal and external, controllable and uncontrollable, tangible and
intangible. For example, ABC Ltd. might forecast increased laptop demand due to the work-from-home
trend, gathering accurate information to set realistic objectives.
3. Identifying Alternative Courses of Action
After setting objectives and assumptions, the organization identifies alternative ways to achieve its goals.
This requires collecting accurate and relevant information from various sources. For every objective,
multiple alternatives should be considered. ABC Ltd., for instance, might explore options like price
reductions, increased advertising, or enhanced after-sale services, involving employees and customers in
idea generation.

4. Evaluating Alternative Courses
Once alternatives are identified, each one must be evaluated based on expected costs, benefits, risks, and
alignment with goals. Both positive and negative aspects of each alternative are thoroughly examined.
For instance, ABC Ltd. should compare the potential impact of different marketing strategies on sales
and profitability, weighing the pros and cons of each option.
5. Selecting an Alternative
After evaluating options, the most suitable course of action is chosen. This involves formulating detailed
and derivative plans, such as policies and budgets, to support the primary plan. Sometimes, a
combination of alternatives is selected. For example, ABC Ltd. might decide to use TV advertisements,
online marketing, and direct contact with MNCs to boost sales, leveraging multiple strategies to
maximize impact.
6. Implementing the Plan
The chosen plan is then put into action, requiring detailed communication and coordination among
employees. Suggestions from staff are considered, and they are motivated to execute the plan effectively.
Implementation involves organizing labor and acquiring necessary resources. For instance, ABC Ltd.
Maybe hire more salespeople, create engaging online ads, and establish service workshops in various
cities to support the sales plan.
7. Follow-up Action
Finally, the plan's effectiveness is periodically reviewed through continuous monitoring and adjustments
as needed. Feedback mechanisms are developed to gather input from customers and employees, ensuring
the plan remains relevant and effective. For example, ABC Ltd. might collect consumer reviews and
revenue data to fine-tune their strategies and improve service delivery, ensuring they meet their sales
targets.
Importance of Planning:
 Planning Provides Direction: Planning involves deciding the future course of action by setting
clear goals and objectives. It ensures unity of direction and reduces aimless activities, making
actions more purposeful.
 Planning Reduces the Risk of Uncertainty: By anticipating future events and preparing for
potential risks, planning helps businesses navigate uncertain environments and eliminate
unnecessary actions.
 Planning Reduces Overlapping and Wasteful Activity: Effective planning integrates activities
across departments, minimizing overlapping efforts and wasteful activities by aligning them with
the organization's objectives.

 Planning Promotes Creativity and Innovation: Planning encourages managers to develop and
implement new ideas, leading to the creation of innovative products and services, and
contributing to the overall growth and expansion of the business.
 Planning Facilitates Decision-Making: By providing a framework for evaluating various

alternatives, planning aids managers in making informed decisions that align with future goals
and objectives.
 Planning Establishes a Standard for Controlling: Planning sets benchmarks for performance
evaluation. By comparing actual performance against these standards, managers can identify
deviations and take corrective actions to ensure alignment with plans.
Characteristics of Plans
1. Planning is goal-oriented
2. Planning is looking ahead
3. Planning is an intellectual process
4. Planning involves choice and decision making.
5. Planning is the primary function of management/Primacy of Planning
6. Planning is a continuous process.
7. Planning is all-pervasive
8. Planning is designed for efficiency
9. Planning is flexible
Types of Plans

To guide managers in decision-making and problem-solving, various plans are used to manage day-to-
day activities and regulate work behavior. These plans are categorized into two main types: standing
plans and single-use plans.
I. Standing Plans
Standing plans are designed for repeated use whenever a particular situation arises, ensuring smooth
internal operations. Developed once but used over years, these plans are modifiable and typically
prepared by top-level managers. They include objectives and goals, strategy, policy, procedure, rules,
and methods.
a. Objectives and Goals: Objectives are specific targets that support the broader goals of the
organization. Goals indicate what the organization aims to achieve, while objectives break these
goals into actionable steps, guiding decision-making and resource allocation.
b. Strategy: A comprehensive plan to achieve long-term objectives and respond to external

challenges. Strategies guide organizations in adapting to changes in the economic, political, social,
legal, and technological environment.
c. Policy: General statements that guide thinking and actions within the organization. Policies define
boundaries for decision-making and ensure consistency in actions across various levels and
departments.
d. Procedures: Detailed, chronological steps to achieve a desired result, providing uniformity in

actions and simplifying tasks by eliminating unnecessary steps. Procedures need regular review to
stay relevant.
e. Rules: Directives that specify what is and isn't allowed within the organization. Rules are rigid and
enforceable, aiming to maintain discipline and improve efficiency. Violations usually result in
penalties.
f. Method: Standard techniques for performing repetitive tasks. Methods provide clear instructions
for day-to-day activities, ensuring tasks are completed efficiently and effectively.

II. Single-use Plans
Single-use plans are created for specific objectives and are discarded once these objectives are achieved.
They are short-lived and must be reformulated after each use. These plans include programs and
budgets.
a. Program: Comprehensive plans that combine goals, task assignments, policies, and resources to
achieve objectives. Programs provide a step-by-step guide to complete tasks within a specified
period and include both major and minor programs.
b. Budget: A financial plan estimating future needs and allocating resources for a specific period,
usually one year. Budgets are expressed in numerical terms and serve as tools for planning and
control, helping evaluate performance against set standards.
Organizing
Organizing in management involves a series of steps to identify and group activities, assemble resources,
and establish authority relationships within job positions. It involves arranging people and resources
efficiently to achieve the organization's goals. The process includes defining activities, grouping them
into work units, and establishing clear roles and responsibilities.
“Organizing is a function by which the concern is able to define the role positions, the jobs related and
the coordination between authority and responsibility.” – Chester I. Barnard
“Organizing is the process of defining and grouping the activities of the enterprise and establishing the
authority relationships among them.” – Luther Gulick
Importance of Organizing
1. Benefits of Specialization: Organizing divides work into units and departments, leading to
specialization. This systematic allocation of tasks enhances productivity and reduces workload,
resulting in efficient and speedy job performance.
2. Clarity in Working Relationships: Organizing clarifies the authority and responsibility of

individuals within departments. This coordination creates clear responsibility and authority
relationships, ensuring cooperation and avoiding confusion.
3. Optimum Utilization of Resources: Organizing ensures the optimal use of human and material
resources by assigning tasks based on skills and knowledge. This clarity in job roles motivates
employees and prevents confusion.
4. Adaptation to Change: Organizing allows an organization to accommodate changes in the

business environment by modifying structures and revising job positions. This flexibility and
stability help the organization adapt to new technologies and methods.
5. Effective Administration: Organizing provides clear job descriptions and relationships, reducing
confusion and duplication of work. Delegating authority also relieves top management from
routine tasks, allowing them to focus on strategic issues.
6. Development of Personnel: Organizing trains managers through delegation, reducing their

workload and allowing them to concentrate on important tasks. Delegation fosters responsibility
and motivates subordinates to tackle more challenging work.
7. Expansion and Growth: Effective organizing creates favorable conditions for expansion and
diversification. It enables the organization to add new job positions and departments, supporting
business growth and taking on new challenges.
Authority
“Authority is the special rights granted to position holder in the organization. Such rights enable him to
decide, to command and to allocate resources, to get the decision executed”
Power
“Power is potential ability to influence behavior, to change the course of events, to overcome resistance,
and to get people do things that they would not otherwise do”
Jeffrey Pfeiffer
“The ability to influence others behavior”
Types of Organization Structure
The term "structure" refers to the management of parts and the interrelationships among activities and
people within an organization. Therefore, organizational structure is an element that provides the
foundation for managers and non-managerial employees to perform their assigned jobs. It defines roles,
responsibilities, and the authority relationships between various positions, creating a framework within
which managerial and operational tasks are carried out.
Benefits of Organizational Structure
 An effective organizational structure brings numerous advantages to the efficient functioning of an
organization:
 Allocation of Authority and Responsibility: It clearly defines who is responsible for what tasks and
who has the authority to make decisions.
 Pattern of Communication and Coordination: It establishes a clear communication and
coordination pattern among different departments and levels of the organization.
 Facilitation of Proper Control: It enables effective control over the operations of the business
enterprise.
 Support for Growth and Development: It facilitates the growth and development of the enterprise
by providing a clear framework for expansion.
 Adaptability to Changes: It makes the organization adaptable to changes in the environment,
helping it to respond effectively to new challenges.
Types of Organizational Structure
1. Functional Structure
2. Divisional Structure

1. Functional Structure
A functional organizational structure is a system where various activities are classified into distinct
functions, each managed by a functional expert. In this structure, each major function is organized as a
separate department, and major functions may be further divided into sub-functions. This type of structure
is the most widely used because it allows expanded businesses to appoint experts with specialized
knowledge.
For example, in a manufacturing enterprise, basic functions include production, sales, and finance. These
functions can be divided into sub-functions such as repair and maintenance, and quality control. This
concept originated from F.W. Taylor's functional foremanship, which recommended appointing specialists
at different positions so subordinates could serve and receive orders from multiple specialists and
managers.
Suitability
A functional structure is suitable when:
The organization needs to carry out diversified activities.
The organization is large in size.
The tasks require a high degree of specialization.

2. Divisional Structure:
When jobs related to a specific product are grouped under one department, it is called a divisional
structure. This type of structure is ideal for large organizations with multiple products. In this
method, a separate department is created for each major product, and each department is led by a
divisional manager responsible for all functional activities related to that department. Every
department functions as a multifunctional unit, performing all necessary tasks. Each division
operates as a profit center, with the divisional head accountable for its profit and loss.
Suitability
 The organization manufactures a large variety of products using different resources.
 The organization is growing and needs to add more employees.
 It is important to determine the profit and loss for each product line.
 The enterprise creates more departments and introduces new levels of management.

Types of Organization
Organizations are networks of relationships among people working together to achieve the best output in
an enterprise. Based on these relationships, organizations can be classified into two types: formal and
informal.
Formal Organization
A formal organization refers to an official structure of well-defined jobs, each with specific authority and
responsibility. This structure is deliberately designed by management to achieve specific tasks and goals.
In a formal organization, positions and authority levels are clearly defined, enabling people to work
together effectively. Each person is accountable for their performance, and there is a clear superior-
subordinate relationship. The structure of a formal organization can be either functional or divisional.

Informal Organization
An informal organization is a network of social relationships that emerge naturally due to interactions
among people within a formal organization. Unlike formal organizations, informal ones are not pre-
planned; they develop spontaneously from frequent contact and social needs that cannot be met through
formal structures. Informal organizations lack prescribed rules and policies, arising instead from social
interactions and personal connections.
UNIT-3
LEADERSHIP AND MOTIVATION
Meaning of Leadership
A leader is a person who can influence others and holds managerial authority. Leadership involves:
 Influencing and supporting others to work enthusiastically towards achieving goals.
 Guiding a group to achieve objectives.
Leader vs. manager
 Leaders focus on doing the right thing, while managers focus on doing things right.
 Leaders ask, "What should we be doing?" while managers ask, "How can we do what we're
already doing better?"
 Leaders focus on vision, mission, goals, and objectives, while managers focus on productivity and
efficiency.
 Leaders have a long-term perspective, while managers have a short-term perspective.

Characteristics of Leadership
 Empathy
 Consistency
 Honesty
 Direction
 Communication
 Support from all
 Assuming obligation
 Importance of Leadership
 Initiates action
 Motivates
 Provides guidance
 Create confidence
 Ensure coordination
 Enables effective planning
 Inspires and motivates

Theories of Leadership
1. Great Man Theory

The Great Man Theory, a 19th-century idea, posits that history is largely shaped by the impact of great
men or heroes. These highly influential individuals, due to their charisma, intelligence, wisdom, or
political skill, used their power to create decisive historical impacts. According to this theory:
 Leaders are born, not made. This approach suggests that a person either possesses the necessary
traits of leadership at birth or does not.
 It believes that only certain individuals are born with the unique traits required for leadership.
 The Great Man Theory emphasizes "charismatic" leadership.
 Regardless of the group, a natural leader will always be recognized for their inherent leadership
qualities.
 Leadership requires specific qualities such as commanding presence, charm, courage, intelligence,
persuasiveness, and aggressiveness.
2. Leader–member exchange theory
According to the Great Man Theory, leadership is centered on the interactions between a leader and a
subordinate. However, the Leader-Member Exchange (LMX) theory focuses on the dynamic, interactive
relationships rather than just the leader-follower relationship. LMX theory suggests that a leader should
not have the same association with every group member because people have different needs and require
different interactions. The theory posits that leaders form strong, trust-based, emotional, and respect-
driven relationships with some team members but not with others. LMX theory asserts that leaders do
not treat each subordinate equally, acknowledging the variability in their interactions.
a k
3. Fiedler’s Contingency Model
Fiedler's model posits that a leader’s effectiveness is contingent on the favorability of the leadership
situation, determined by three factors:
 Leader-Member Relations: The degree of trust and likability between the leader and group
members, and their willingness to follow the leader.
 Task Structure: The clarity and structure of the group's task, including how well-defined and
detailed it is.
 Position Power: The authority and power the leader holds within the organization to influence
group members.
These variables create eight combinations of group-task situations to identify the most effective
leadership style for each.
Leader’s trait
In order to assess the attitudes of the leader, Fiedler developed the ‘least preferred co-worker’ (LPC)
scale in which the leaders are asked about the person with whom they least like to work. The scale is a
questionnaire consisting of 16 items
c used to reflect a leader’s underlying disposition toward others. The
items in the LPC scale are
 Pleasant / Unpleasant,
 Friendly / Unfriendly,
 Rejecting / Accepting,
 Unenthusiastic / Enthusiastic,
 Tense / Relaxed,
 Cold / Warm,
 Helpful / Frustrating,
 Cooperative / Uncooperative,
 Supportive / Hostile,
 Quarrelsome / Harmonious,
 Efficient / Inefficient,
 Gloomy / Cheerful,
 Distant / Close,
 Boring / Interesting,
 Self-Assured / Hesitant,
 Open / Guarded.

Each item in the scale is given a single ranking of between one and eight points, with eight points
indicating the most favorable rating.
Friendly
Unfriendly
8 7 6 5 4 3 2 1
Fiedler states that leaders with high LPC scores are relationship-oriented and the ones with low scores
are task-oriented. The high LPC score leaders derived most satisfaction from interpersonal relationships
and therefore evaluate their least preferred co-workers in fairly favorable terms. These leaders think
about the task accomplishment only after the relationship need is well satisfied. On the other hand, the
low LPC score leaders derived satisfaction from performance of the task and attainment of objectives
and only after tasks have been accomplished, these leaders work on establishing good social and
interpersonal relationships.
Figure 1: Correlation between leader’s LPC scores and group effectiveness Leadership
4. House’s Path Goal Theory

Developed by Robert House, this theory, rooted in the expectancy theory of motivation, emphasizes the leader's
role in clarifying paths to goals and removing obstacles for employees. Leaders act as coaches and facilitators,
providing necessary information, support, and resources.
5. Managerial Grid
Developed by R.R. Blake and J.S. Mouton, the Managerial Grid Theory helps managers identify their
leadership style based on two dimensions: Concern for People and Concern for Production. It outlines
five basic leadership styles:
I. Country Club Management (1, 9): Leaders prioritize social needs over productivity, creating a
friendly but potentially unproductive environment with disorganized schedules and low
productivity.
II. Authority-Compliance Management (9, 1): Leaders focus on productivity over employee
needs, enforcing strict rules and schedules. This autocratic style emphasizes obedience and high
productivity.
III. Impoverished Management (1, 1): Leaders show low concern for both employees and
productivity. They avoid involvement, leading to disorganized and uncoordinated teams.
IV. Middle-of-the-road Management (5, 5): Leaders balance employee needs and productivity
without excelling in either. Communication is good, but this style often results in moderate
success and frequent conflicts.
V. Team Management (9, 9): Leaders equally value employee needs and productivity, fostering
high team spirit and commitment. This ideal style ensures organized tasks, high motivation, and
effective problem-solving, leading to high productivity.

MOTIVATION
Meaning Of Motivation:
Motivation is the process of stimulating people to action to accomplish desired goals. Motivation is a
managerial function which has been defined by different scholars. Some of the important definitions are
as follows:
According to Edwin B.Flippo, “Motivation is the process of attempting to influence others to do your
will through the possibility of gain or reward.”
According to Dalton E. McFarland, “Motivation refers to the way in which urges, drives, desires,
aspirations, and strivings or needs direct, control or explain the behavior of human beings.”
Nature of Motivation:
 Internal Influence: Motivation is an internal feeling that drives behavior.
 Individual Variation: The effectiveness of motivation varies by individual.
 Goal Achievement: Motivation leads to positive goal attainment in organizations.
 Relation to Satisfaction: Motivation is closely linked to satisfaction.
 Positive and Negative: Motivation can be both positive and negative.
 Complex Process: Motivation is complex due to individuals' diverse expectations, perceptions,
and reactions.
 Needs and Values: Stronger motivation arises from needs aligned with personal values.

Importance of Motivation:
 Stimulates Work: Helps managers inspire employees to work.

 Enhances Abilities: Improves employees' skills and capabilities.
 Reveals Talents: Discovers hidden talents and potential.
 Increases Satisfaction: Leads to job and personal satisfaction.
 Reduces Conflict: Lowers chances of industrial unrest and labor issues.
 Positive Attitudes: Transforms negative attitudes into positive ones, aiding organizational goals.
 Lowers Turnover: Decreases employee turnover, saving recruitment and training costs.
MOTIVATIONAL THEORIES
1. Maslow’s hierarchy of needs: According to Maslow’s theory of needs, individual needs are arranged
in a hierarchy. There are five categories of needs
I. Physiological needs
II. Safety needs
III. Love and belonging
IV. Esteem
V. Self-actualization
2. Herzberg Two-factor theory
● Motivators (e.g. challenging work, recognition for one's achievement, responsibility,

opportunity to do something meaningful, involvement in decision making, sense of importance to

an organization) that give positive satisfaction, arising from intrinsic conditions of the job itself,
such as recognition, achievement, or personal growth, and
● Hygiene factors (e.g. status, job security, salary, fringe benefits, work conditions, good pay, paid
insurance, vacations) that do not give positive satisfaction or lead to higher motivation, though
dissatisfaction results from their absence.
3. Theory X and Theory Y
4. Herzberg's Two-Factor Theory:

Proposed by Frederick Herzberg in 1959, this theory distinguishes between two types of job factors:
 Hygiene Factors: Extrinsic factors like compensation, job security, working conditions, and
relationships. These prevent dissatisfaction but don't increase satisfaction.
 Motivational Factors: Intrinsic factors such as achievement, recognition, and responsibility. These
lead to satisfaction and motivate employees to perform better.
5. McClelland's Theory of Needs:
Developed by David McClelland, this theory identifies three key needs:
Need for Achievement (nAch): The drive to excel and achieve set standards.
Need for Power (nPow): The desire to control and influence others.
Need for Affiliation (nAff): The desire for friendly and cooperative interactions.
6. Alderfer's ERG Theory:

Clayton Alderfer expanded Maslow's hierarchy into three categories:
 Existence Needs: Basic physical and safety needs.

 Relatedness Needs: Social and external esteem needs.

 Growth Needs: Self-actualization and internal esteem needs.
The theory also introduces the frustration-regression principle, where unmet higher-level needs cause
regression to lower-level needs.
7. Vroom's Expectancy Theory:

Victor Vroom's theory posits that motivation is based on:
 Expectancy (E): Belief that effort will lead to good performance.

 Instrumentality (P): Belief that performance will lead to rewards.
 Valence (O): Value placed on the rewards. Motivation depends on the clarity and alignment of these
elements, as well as ability and role clarity.
8. Equity Theory:
This theory suggests that motivation is influenced by an individual's perception of fairness. Employees
compare their input-output ratios with others and feel motivated when they perceive fairness and
demotivated when they perceive inequity.

UNIT-4 ORGANIZATIONAL BEHAVIOR
Definition:
Organizational Behavior (OB) is a field of study that explores how individuals, groups, and organizational
structures influence and are influenced by behavior within organizations. Behavior encompasses what
people do in the organization, their performance, and their attitudes. OB is often applied to business
organizations to address workplace issues such as absenteeism, turnover, productivity, motivation,
teamwork, and job satisfaction. Managers use insights from OB research to manage their organizations
more effectively.
In essence, OB involves understanding, predicting, and managing human behavior both individually and
in groups within an organizational context.
Nature and Importance of OB:

Organizational behaviour has emerged as a separate field of study. The nature it has acquired is
identified as follows:
1. A Separate Field of Study and not a Discipline Only

2. An Interdisciplinary Approach
3. An Applied Science
4. A Normative Science
5. A Humanistic and Optimistic Approach
6. A Total System Approach
Importance of OB:
 It builds better relationship by achieving people, organizational, and social objectives.

 It covers a wide array of human resource like behavior, training and development, change
management, leadership, teams etc.
 It brings coordination which is the essence of management.
 It improves goodwill of the organization.
 It helps to achieve objectives quickly.
 It makes optimum utilization of resources.
 It facilitates motivation.
 It leads to higher efficiency.
 It improves relations in the organization.
 It is multidisciplinary, in the sense that applies different techniques, methods, and theories to
evaluate the performances.
Contributing Disciplines to OB
Organizational behaviour is an applied behavioral science that is built upon contributions from a number
of behavioral disciplines. The predominant areas are psychology, sociology, social psychology,
anthropology, and political science
1. Psychology
2. Sociology
3. Social psychology
4. Anthropology
5. Political science

Foundations of OB
The subject of ob is based on few fundamental concepts which revolve around the nature of people and
organizations. The basic assumptions in OB are:
Elements of OB:
A conceptual model is a representation of a system, made of the composition of concepts which are used
to help people know, understand, or simulate a subject the model represents.
Individual Processes: The behavior of an individual employee is influenced by factors such as mental
makeup, family background, cultural background, and social background. These factors are studied
through perception, personality, values, attitudes, job satisfaction, motivation, and learning.
 Perception: A complex cognitive process that creates a unique view of the world, influencing
behavior based on this perceptual world.
 Personality: The sum of ways an individual reacts and interacts with others, shaped by heredity,
environment, and situations.
 Values: Basic convictions that certain behaviors or end states are preferable.
 Attitudes: Evaluative statements about objects, people, or events.
 Job Satisfaction: A person's feeling of satisfaction at work, which motivates them to perform.
 Motivation: The process that determines an individual's intensity, direction, and persistence of
effort toward a goal.
 Learning: A relatively permanent change in behavior resulting from experience.
Interpersonal and Team Processes: The integrated behavior of people in a group, studied through
communication, leadership, group dynamics, and teamwork.
 Interpersonal Communication: The transfer and understanding of information, which can be formal
or informal, and occur in various directions (downward, upward, horizontal, crosswise).
 Leadership: The ability to influence a group toward goal achievement, encompassing styles like
autocratic, benevolent, participatory, and democratic.
 Teamwork: When individual efforts result in performance greater than the sum of individual
inputs. Types of teams include self-managed, problem-solving, cross-functional, and virtual teams.
 Group Dynamics: The study of both formal and informal groups that exist until their purpose is
achieved.
Organizational Processes: The division, grouping, and coordination of job tasks, structured based on
departments, functions, products, and services.

 Organizational Culture: The pattern of basic assumptions developed by a group to cope with
external adaptation and internal integration, considered valuable enough to be taught to new
members.
 Power and Politics: Universal phenomena that employees and managers need to understand,
with success in using power depending on understanding and appropriate application.
 Job and Organizational Design: Understanding job design and coordinating job tasks, with
organizational design shaping the structure.
 Decision Making: An important managerial activity involving choosing the best solution from
alternatives under given circumstances.
Change Processes: Managing change involves adapting to environmental demands and modifying
employee behavior, considering pressures, resistance, and who should implement change.
Challenges and Opportunities for OB: OB considers organizations as being composed of levels, from
individuals to groups to the entire organizational structure. Each level contributes to workplace activities,
with group concepts building on individual behavior and structural constraints overlaying both to form
OB.
When we look at the different levels in the organization, we recognize that each has challenges that can
affect how the levels above and/or below might operate. We consider the challenges at the individual,
group, and organizational levels.
• Individual Differences
• Job Satisfaction
• Motivation
• Empowerment
• Behaving Ethically
• Working with others
• Workforce diversity
• Productivity
• Developing effective employees
• Putting people first
• Global competition
• Managing and working in a multicultural world.

PERCEPTION
Perception can be defined as the process through which individuals receive, select, organize, and
interpret sensory information from their environment to give it meaning. It involves using sensory inputs
like sight, hearing, touch, taste, and smell to make sense of surroundings and make decisions. Joseph
Reitz describes perception as encompassing all processes by which individuals receive information
about their environment, influenced by the objects or events being perceived, the environment itself, and
the individual doing the perceiving.
Nature and Importance of Perception

Perception is crucial in understanding individual behavior variations because it is influenced by both
physiological factors (such as sensory organs) and psychological factors (like beliefs and values). This
subjective process leads different people to interpret the same environment differently. Understanding
perception helps predict how individuals will behave in different situations and assess their needs based
on their perceptions.
Perceptual Process
The perceptual process comprises several stages:
 Receiving: Sensory organs like eyes, ears, and skin receive stimuli from the environment, such
as sounds, smells, and physical sensations.
 Selecting: Individuals filter and focus on relevant stimuli based on factors like size, intensity,
repetition, contrast, movement, novelty, familiarity, and personal interests.
 Organizing: Organizing involves arranging selected stimuli into a meaningful whole using
principles like figure-ground relationships, perceptual grouping (based on similarity, proximity,
closure, and continuity), and perceptual constancy (maintaining stable perceptions despite
changes in stimuli).
 Interpreting: This stage involves assigning meaning to organized stimuli, influenced by factors
such as perceptual set (pre-existing beliefs shaping interpretations), stereotyping (judging based
on group membership), the halo effect (bias from a single trait), projection (attributing own
attributes to others), and selective perception (focusing on stimuli that align with personal
interests and beliefs).
 Checking and Reacting: After interpreting information, individuals verify their interpretations
against reality and then react accordingly, forming attitudes, opinions, beliefs, and emotions
about the perceived objects or events.
Factors Influencing Perception

Perception is influenced by:
 Characteristics of the Perceiver: Past experiences, needs, personality traits, values, and
attitudes shape how individuals perceive their environment.
 Characteristics of the Perceived: Physical attributes, behavior, and appearance of the target
influence how they are perceived.
 Characteristics of the Situation: The physical, social, and organizational context in which
perception occurs affects how individuals interpret stimuli.

Perception and Organizational Behavior
In organizational settings, perception influences various aspects such as employment interviews (where
initial impressions shape hiring decisions), performance appraisals (where subjective evaluations are
influenced by perceptions), and overall organizational dynamics. Recognizing the subjective nature of
perception helps mitigate biases and improve decision-making processes in organizations.
In summary, perception is a dynamic process crucial for understanding human behavior and decision-
making, shaped by both external stimuli and internal cognitive processes.
ATTITUDE
Attitudes are defined as mental states of readiness, shaped and organized through experiences,
influencing how individuals respond to people, objects, and situations they encounter. These learned
predispositions can be either positive or negative towards specific aspects of our environment.
Components of Attitudes
 Affective Component: This refers to the emotional or feeling aspect linked to an attitude object.
For example, a fear of spiders might lead to a negative affective response towards them.
 Cognitive Component: This involves the beliefs, thoughts, and attributes associated with an
attitude object. Attitudes can be based on positive or negative attributes perceived about
something.
 Behavioral Component: This component reflects past behaviors or experiences related to the
attitude object. People often infer their attitudes from their past actions or interactions with the
object.
Functions of Attitudes
 Adjustment Function: Directs individuals toward pleasant or rewarding objects and away from
unpleasant or undesirable ones.
 Ego-Defensive Function: Helps protect the ego or self-image from threats, with outward
expressions often reflecting the opposite of perceived threats.
 Value-Expression Function: Allows individuals to express their central values through their
attitudes, translating abstract values into tangible expressions.
 Knowledge Function: Aids in creating a structured and understandable world, fulfilling the
human need for consistency, stability, definition, and understanding.
Factors Affecting Attitudes
 Experience: Personal encounters and interactions shape attitudes significantly.

 Association and Reference Groups: Attitudes can be influenced by the groups individuals
associate with or aspire to belong to.
 Family, Society, and Culture: Upbringing, societal norms, and cultural values play pivotal roles
in forming attitudes.
 Personality: Individual traits and characteristics contribute to the formation and expression of
attitudes.
 Job-Related Attitudes
 In the context of work environments, specific job-related attitudes include:
 Job Involvement: The extent to which individuals identify with their job, actively engage in it,
and perceive its importance to their self-worth.
 Job Satisfaction: Refers to an individual's overall attitude toward their job, reflecting their level
of contentment or dissatisfaction.
 Organizational Commitment: Indicators the degree to which employees identify with an
organization's goals and values, and their desire to remain part of the organization.

PERSONALITY
Personality is defined as the collective sum of an individual's reactions and interactions with others, often
characterized by measurable traits they exhibit.
Determinants of Personality
1. Heredity: This refers to genetic factors determined at conception. It encompasses the molecular
structure of genes within chromosomes, influencing physical traits such as facial attractiveness and
muscle composition inherited from parents.
2. Environment: This broad term includes the cultural context in which individuals are raised,
cultural norms, early conditioning, and social groups they belong to.
3. Family: Families exert significant influence on personality development, particularly during

childhood when parents play pivotal roles in an individual's early identification processes.
4. Socialization Process: This process involves acquiring behavioral tendencies initially from family
and later from broader social groups and organizational environments.
These factors collectively shape how individuals perceive, interact with, and respond to their
surroundings, contributing to the formation of their unique personality traits and behaviors.
Personality Traits
Personality traits are the enduring qualities or characteristics that describes an individual behavior.
1. The Myers-Briggs Type Indicator(MBIT)

2. The Big 5 Model
3. Type A and Type B personality
The Myers-Briggs Type Indicator (MBIT)

The Myers-Briggs Type Indicator (MBTI) is globally recognized as a prominent personality assessment
tool. It consists of 100 questions that prompt individuals to describe their typical feelings or behaviors in
various situations. Based on their responses, participants are categorized into four dichotomies:
Extraverted (E) vs. Introverted (I): Extraverted individuals are characterized as outgoing, sociable, and
assertive, while introverts tend to be quieter and more reserved.
Sensing (S) vs. Intuitive (N): Sensing types are pragmatic, preferring routine and structure while
focusing on details. Intuitive types rely on unconscious processes and emphasize the broader perspective
or big picture.
Thinking (T) vs. Feeling (F): Thinking types use logic and reason to approach problems, whereas feeling
types prioritize personal values and emotions in decision-making.
Judging (J) vs. Perceiving (P): Judging types seek control and prefer structured environments. Perceiving
types are adaptable and spontaneous, often embracing flexibility.

The MBTI provides insights into how individuals perceive and engage with their surroundings, offering a
framework for understanding their distinctive personality preferences and behaviors.

These classifications together describe 16 personality types, identifying every person by one trait from
each of the four pairs.
The Big 5 Model

The MBTI may lack strong supporting evidence, but an impressive body of research supports the thesis
of the Big Five Model—that five basic dimensions underlie all others and encompass most of the
significant variation in human personality. Moreover, test scores of these traits do a very good job of
predicting how people behave in a variety of real-life situations.

The following are the Big Five factors:
● Extraversion.
● Agreeableness.
● Conscientiousness.
● Emotional stability.
● Openness to experience.
Type A and Type B Personality

Type A and Type B are two types of trait classification.
Type A individuals are aggressive, ambitious, controlling, highly competitive, preoccupied with status,
workaholics, hostile, and lack patience.
They are-
⮚ Always moving, walking and eating rapidly;
⮚ Feel impatient with the rate at which most events take place;
⮚ Strive to think or do two or more things simultaneously;
⮚ Cannot cope with leisure time; and
⮚ Are obsessed with numbers, measuring their success in terms of how much of everything they
acquire.
Type B people are relaxed, less stressed, flexible, emotional and expressive, and have a laid- back
attitude.
They –
⮚ Never suffer from sense of time urgency with its accompanying impatience;
⮚ Feel no need to display or discuss either their achievements or accomplishments unless it is

demanded;
⮚ Play for fun and relaxation, rather than to exhibit their superiority at any cost; and
⮚ Can relax without guilt.
Group Dynamics
A group is defined as two or more individuals, interacting and interdependent, who have come together
to achieve particular objectives
Classification of groups
Groups can be either formal or informal.
1. Formal Groups: These are designated work groups defined by the organization’s structure. They
are established to carry out work in support of the organization's goals, with behaviors directed toward
achieving these goals. Examples include a bookkeeping department, an executive committee, and a
product development team. Formal groups can be command groups, task groups, or committees.
 Command Group: Consists of a manager and the employees who report to them, defined by
the organizational hierarchy. Membership is determined by each employee's position on the
organizational chart.
 Task Group: Comprises employees who work together to complete a specific task or project.
Membership is based on the responsibilities delegated to each employee, and these groups can
cross command relationships. Task groups can be temporary with a set lifespan or open-ended.
 Committee: A group officially delegated to perform functions such as investigating,
considering, reporting, or acting on matters. Committees investigate, analyze, and debate
problems and make recommendations, which are sent to the authority responsible for
implementation. Committees typically have members with specific roles such as advisory
authority and secretary.
Characteristics of Formal Groups:
 Explicitly stated structure, procedural rules, and membership
 Created to carry out specific tasks or meet required goals
 Can be relatively permanent or temporary (e.g., steering groups or problem-solving groups)
 Defined roles and designated work assignments
 Well-defined norms
 Specified goals and deadlines

2. Informal Groups: These evolve to meet social or affiliation needs, bringing people together based
on shared interests or friendships. Informal groups are natural formations in the work environment that
arise in response to the need for social contact. People are often attracted to one another due to
proximity, as working near each other daily increases the likelihood of forming friendships. This
likelihood is even greater when people share similar attitudes, personalities, or economic status.
i) Friendship Groups:
ii) Interest Groups:
iii) Reference Groups:
iv) Membership Groups:
Stages of group development

Bruce Tuckman (1965) developed a 4-stage model of group development. He labeled the stages, Dr
Suess-style:
1. Forming: The group comes together and gets to initially know one other and form as a group.
2. Storming: A chaotic vying for leadership and trialing of group processes
3. Norming: Eventually agreement is reached on how the group operates (norming)
4. Performing: The group practices its craft and becomes effective in meeting its objectives.
Tuckman added a 5th stage 10 years later:
5. Adjourning: The process of "unforming" the group, that is, letting go of the group structure and
moving on.
Fig. Stages of Group Development
Group Decision Making
Because the performance of a group involves taking into account the needs and opinions of every group
member, being able to come to an equitable decision as efficiently as possible is important for the
functioning of the group. There are a variety of ways to make decisions as a group; the seven-step
decision-making model presented below offers an effective structure for choosing an appropriate course
of action for a particular task or project. It can also be an effective method for dealing with a problem or
interpersonal conflict that arises within the group.

Group Norms
All groups have norms—“acceptable standards of behavior that are shared by the group’s members.”
Norms tell members what they ought and ought not to do under certain circumstances
Status: Status is a socially defined position or rank given to groups or group members by others. We
live in a class-structured society despite all attempts to make it more egalitarian
Group Size: The size of a group affects the group’s overall behavior, but the effect depends on the
dependent variables
Social loafing: It is the tendency for individuals to expend less effort when working collectively than
when working individually.
Group Cohesiveness: The degree to which members are attracted to each other and are motivated to
stay in the group
Team
A team is a work group that must rely on collaboration if each member is to experience the optimum
success and achievement.
"A team is a small number of people with complementary skills .who are committed to a common
purpose, performance goals, and approach for which they are mutually accountable”.
Team leaders place considerable emphasis on team building and then evaluate their own performance on
the basis.
Role of Team Leader
⮚ Give feedback & resolve conflict
⮚ Help to keep team focused on the mission despite personality conflict, work style difference and
blockages by interpersonal conflict
⮚ Build trust and inspire teamwork

⮚ Coach team members and group members toward higher levels of performance
⮚ Facilitate and support the team decisions
⮚ Expand the teams capabilities
⮚ Create a team identity Anticipate & influence change
⮚ Inspire the team toward higher levels of performance
⮚ Enable & empower group members to accomplish their work
⮚ Encourage team members to eliminate low-value work.
Types of Teams
1. Process Team: These teams operate without a specific departmental affiliation, focusing on
broad organizational process improvements.
2. Self-Managed Team: A self-managed team is a mature group of employees who work without
supervisory oversight and are responsible for an entire work package. These teams select their
own members and evaluate performance, often necessitating significant organizational
restructuring.
3. Cross-Departmental or Functional Team: Cross-functional teams study, analyze, and implement

solutions to specific problems, ensuring accountability. These small groups consist of
interdependent employees from various organizational functions and are essential when:
 An issue affects multiple sections of the organization.
 Operational or process improvements require close coordination across departments.
 Multiskilled individuals cannot handle the work alone.
 Achieving goals requires the simultaneous application of diverse skills and expertise from
different sections.
4. Problem-Solving Team: Also known as quality improvement teams, quality circles, or work
teams, these groups typically consist of eight to ten members from a common work area. They
focus on process improvements within a single unit and can be established without major
organizational changes.
5. Virtual Team: Virtual teams allow members to collaborate without concern for physical location,
linking the workforce in ways previously impossible. These teams leverage advanced technology
to achieve business goals, solve problems, provide feedback, maintain awareness, share
successes, and encourage achievement. Geographic dispersion is not a barrier to their
effectiveness.
Effective Team:
An effective team possesses certain characteristics that enhance the efficiency and productivity of its
members. They share leadership roles and accountability, focusing on collective performance rather than
individual efforts. Building and maintaining such teams requires time and attention to detail, a process
often overlooked by managers and staff. However, successful teamwork significantly boosts productivity
and reduces costs.
Characteristics of an Effective Team:
1. Two-Way Trust and Open Communication: Effective teams thrive in environments where trust is
mutual, and communication is open and honest. This fosters a sense of security and transparency
among team members.
2. Constant Two-Way Feedback: Continuous feedback loops provide team members with
information on how their work contributes to the team’s goals. This helps align individual efforts
with the team's overall objectives.
3. Active Listening: Effective communication within a team includes active listening. Members listen
to each other's ideas and concerns, ensuring that everyone's voice is heard and valued.
4. Shared Responsibility: Team members take collective responsibility for mistakes, avoiding blame
and focusing on solutions. This approach prevents a blame culture and promotes accountability.
5. Celebration of Success: Teams celebrate their achievements together and recognize individual
contributions. This builds morale and reinforces a sense of accomplishment.
6. Pride and Humility: Good teamwork is built on pride in the team’s outcomes and humility in
recognizing and valuing the expertise of others. This balance fosters respect and collaboration.
7. Learning from Mistakes: Mistakes are seen as learning opportunities rather than occasions for
criticism and punishment. However, repeated errors are addressed seriously, while appropriate
risks and innovations are encouraged.
8. Honoring Contributions: Effective teams acknowledge and honor each member’s contributions to
the team’s success, ensuring that everyone feels valued and integral to the team’s achievements.

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UNIT-1

MCOB (MBA 1st Semester)

MCOB (MBA 1st Semester)

MCOB (MBA 1st Semester)

Proper Division of Work

6. Subordination of Individual Interest: Organizational objectives take precedence over personal

MCOB (MBA 1st Semester)

8. Degree of Centralization: Decision-making authority should be balanced between top

3. Max Weber bureaucratic theory

Principles of Bureaucratic Theory

 Authority Hierarchy: A structured hierarchy where higher-ranking officers control subordinates,

Limitations of Bureaucratic Theory

 Inadequate Conflict Resolution: Lacks effective mechanisms to resolve conflicts between

Hawthorne Experiments and Elton Mayo's Contributions

Systems Approach to Management: Key Features

PLANNING AND ORGANIZING

2. Developing Planning Premises

3. Identifying Alternative Courses of Action

MCOB (MBA 1st Semester)

6. Implementing the Plan

MCOB (MBA 1st Semester)

 Planning Facilitates Decision-Making: By providing a framework for evaluating various

MCOB (MBA 1st Semester)

b. Strategy: A comprehensive plan to achieve long-term objectives and respond to external

d. Procedures: Detailed, chronological steps to achieve a desired result, providing uniformity in

MCOB (MBA 1st Semester)

2. Clarity in Working Relationships: Organizing clarifies the authority and responsibility of

4. Adaptation to Change: Organizing allows an organization to accommodate changes in the

6. Development of Personnel: Organizing trains managers through delegation, reducing their

“The ability to influence others behavior”

Types of Organization Structure

which managerial and operational tasks are carried out.

Benefits of Organizational Structure

 An effective organizational structure brings numerous advantages to the efficient functioning of an

who has the authority to make decisions.

 Pattern of Communication and Coordination: It establishes a clear communication and

coordination pattern among different departments and levels of the organization.

by providing a clear framework for expansion.

 Adaptability to Changes: It makes the organization adaptable to changes in the environment,

helping it to respond effectively to new challenges.

Types of Organizational Structure

MCOB (MBA 1st Semester)

A functional structure is suitable when:

The organization needs to carry out diversified activities.

The organization is large in size.

The tasks require a high degree of specialization.

MCOB (MBA 1st Semester)

 The organization manufactures a large variety of products using different resources.

 The organization is growing and needs to add more employees.

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interactions and personal connections.

LEADERSHIP AND MOTIVATION

 Leaders have a long-term perspective, while managers have a short-term perspective.

 Support from all

 Enables effective planning

 Inspires and motivates

MCOB (MBA 1st Semester)

1. Great Man Theory

MCOB (MBA 1st Semester)

4. House’s Path Goal Theory

MCOB (MBA 1st Semester)

MCOB (MBA 1st Semester)

MCOB (MBA 1st Semester)