Managing People and Organization

What is OB

The study of individuals and groups in an organization

A field of study that investigates the impact that individuals,
groups, and structure have on behavior within organizations,
for the purpose of applying such knowledge toward improving
an organizations
effectiveness.
Managing People: What Managers do?

Scientific management developed by Frederick Taylor in the

1880s and 1890s is based on the paradigm that the
productivity and efficiency of labor can be increased by
exercising mechanical/engineering procedure.

Managing People and Organization

However, after second world war, Taylors principle
of managing people got serious criticism. Present
managers integrate both engineering and emotional
view to manage people.
Managers get things done through other people in
organizational environment
They plan, design the job, organize the people,
lead them to perform, and measure their
performance, and finally control and motivate
them.

Managing People and Organization

A good manager is he/she who can organize all the
members under him/her to meet organizational goal, and
members are satisfied, loyal, and committed
So, two things to notice
Performance as an individual and as a group
Job satisfaction
For example Deming (1986) reported the PDCA cycle for
TQM in organization for continuous improvement. His
recommendation for managers include

Managing People and Organization

Robert Katz (1974) identified three basic and also
essential skill for a good manager. These are:
Technical skill: ability to apply expertise and
specialized knowledge
Human skill: The ability to work with, understand,
and motivate other people, both individually and in
groups.
Conceptual skill: The mental ability to analyze and
diagnose complex situations and decision making

Managerial Functions
Skill Type Needed by
Manager Level
Top
Managers
Middle
Managers
Line
Managers
Conceptual

Human

Technical

Managing People and Organization

In the early part of 20th century, a French
industrialist, Henri Fayol observed 5 important
functions of a manager. These are:
Plan
Organize
Command
Coordinate
Control

Managing People and Organization

Now, present organizational manager
condensed these into four categories.

Resources

Management Functions

Human
Financial
Physical
Informational

Goal
Planning

Organizing

Directing

Controlling

Achievements

Managing People and Organization

Planning
A process that
includes defining
goals, establishing
strategy, and
developing plans to
coordinate activities.

Managing People and Organization

Organizing
Determining what
tasks are to be done,
who is to do them,
how the tasks are to
be grouped, who
reports to whom, and
where decisions are
to be made.

Managing People and Organization

Directing
A function that
includes motivating
employees, directing
others, selecting the
most effective
communication
channels, and
resolving conflicts.

Managing People and Organization

Controlling
Monitoring activities
to ensure they are
being accomplished
as planned and
correcting any
significant deviations.

Managing People and Organization

For managing people, process, and organization, a
manager should consider
Individual behavior in organizations, including
diversity and demographic characteristics,
decision making and the effects of personal
networks.
Organizational process, interpersonal behavior,
including teamwork, norms, and managing
through others.
Organizational factors that affect behavior, such
as reward systems, culture, and organizational
design.

Managing People and Organization

There is no unique way or best way to manage.
A manager has to take into account the
environmental conditions that apply to a
specific situation or a specific time when
formulating strategy.
The contingency approach to management
expects that a manager must consider each
facet of environment and the interrelationships
between these facets while decision making,
problem solving, job designing.

Managing People and Organization

Why Organizations Need
Managers
To ensure that the technical
tasks of an organization are
performed to convert its
mission to reality.
To make people capable of
joint performance by:
giving them common goals
and values,
the right environment in
which to operate,
and the ongoing training so
that they can perform and
respond to change. (Peter
Drucker)

Managing People and Organization

Challenges of Managers
Increasing number of global organizations.
Building competitive advantage through superior
efficiency, quality, innovation, and responsiveness.
Increasing performance while remaining ethical
managers.
Managing an increasingly diverse work force.
Using new technologies.

Managing People and Organization

Managerial Role
Mintzberg identified three Managerial Roles: The
Interrelationship
A role is a set of specific tasks a person
performs because of the position they hold.

Roles are directed inside as well as

outside the organization.
Interpersonal Roles
Informational Roles
Decisional Roles

Managing People and Organization

Interpersonal Roles
Roles managers assume to coordinate and
interact with employees and provide direction
to the organization.
Organizational roles that involve serving as a
figurehead, leader, and liaison for an
organization.

Managing People and Organization

Interpersonal Roles

Figurehead role: symbolizes the organization

and what it is trying to achieve.

Leader role: train, counsel, mentor and

encourage high employee performance.

Liaison role: link and coordinate people

inside and outside the organization to
help achieve goals.

Managing People and Organization

Informational Roles
Associated with the tasks needed to obtain
and transmit information for management of
the organization.
Organizational roles that involve monitoring,
disseminating, and serving as a organizational
spokesperson.

Managing People and Organization

Informational Roles

Monitor role: analyzes information from

both the internal and external
environment.
Disseminator role: manager transmits
information to influence attitudes and
behavior of employees.
Spokesperson role: use of information
to positively influence the way people in
and out of the organization respond to it.

Managing People and Organization

Decisional Roles
Associated with the methods managers use to
plan strategy and utilize resources to achieve
goals.
Organizational roles that involve serving as an
entrepreneur, disturbance handler, resource
allocator, and negotiator

Managing People and Organization

Decisional Roles

Entrepreneur role: deciding upon new projects or

programs to initiate and invest.
Disturbance handler role: assume responsibility
for handling an unexpected event or crisis.
Resource allocator role: assign resources
between functions and divisions, set budgets of
lower managers.
Negotiator role: seeks to negotiate solutions
between other managers, unions, customers, or
shareholders.

Managing People and Organization

Managerial Activities

Traditional management

Communication

Exchanging routine information and processing

paperwork

Human resource management

Decision making, planning, and controlling

Motivating, disciplining, managing conflict,

staffing, and training

Networking

Socializing, politicking, and interacting with others

Managing People and Organization

Allocation of Activities
by Time

Background of Organizational Theory

Taylors Principles: Scientific Management

1. Study the way workers perform tasks and
experiment with ways of improving them

Gather detailed, time and motion information.

Try different methods to see which is best.

2. Determine rules that govern task performance

Teach to all workers.

3. Select (according to the rules) the worker for the

task according to the rules set in Step 2.
4. Establish a performance standard, and develop a
pay system that rewards above-standard
performance

Workers should benefit from higher output.

Background of Organizational Theory

Problems of Scientific Management

Managers often implemented only the

increased output side of Taylors plan.

They did not allow workers to share in increased

output.
Specialized jobs became very boring, dull.
Workers ended up distrusting Scientific Management.

Workers could purposely under-perform

Management responded with increased use
of machines.

Background of Organizational Theory

Seeks to create an organization that leads to

both efficiency and effectiveness.
Max Weber developed the concept of
bureaucracy.

A formal system of organization and

administration to ensure effectiveness and
efficiency.

Weber developed the Five principles of

bureaucracy

Background of Organizational Theory

:
Managers formal authority derives from his
position
People should occupy positions because of
performance, not social standing
Each persons formal authority and
responsibilities should be clearly specified
Positions should be arranged with well
defined hierarchically
Managers should create a well-defined
system of rules and norms

Max Weber Principles of Bureaucracy

1.
2.
3.
4.
5.

Background of Organizational Theory

Authority is the power to hold people accountable
for their actions.
Positions in the firm should be held based on
performance not social contacts.
Position duties are clearly identified. People
should know what is expected of them.
Lines of authority should be clearly identified.
Workers know who reports to who.
Rules, Standard Operating Procedures (SOPs), &
Norms used to determine how the firm operates.
Sometimes, these lead to red-tape and other
problems.

Background of Organizational Theory

Henri Fayol, developed a set of 14 principles:

1. Division of Labor: allows for job specialization.
This is the specialization that economists consider necessary for
efficiency in the use of labor.
Fayol applies the principle to all kinds of work, managerial as well as
technical.
Fayol noted firms can have too much specialization leading to poor
quality and worker involvement.
2. Authority and Responsibility: Fayol included both formal and
informal authority resulting from special expertise.
Here Fayol finds authority and responsibility to be related, with the
latter arising from the former. He sees authority as a combination of
official factors, deriving from the manager position and personal
factors.
3. Unity of Command: Employees should have only one boss.
This means that employees should receive orders from one superior
only.

Background of Organizational Theory

Henri Fayol, developed a set of 14 principles:
4. Line of Authority: a clear chain from top to bottom of the firm.
Fayol thinks of this as a chain of superiors from the highest to the
lowest ranks, which, while not to be departed from needlessly, should
be short circuited when to follow it scrupulously would be detrimental.
5. Centralization: the degree to which authority rests at the very top.
Without using the term Centralization of authority. Fayol refers to the
extent to which authority is concentrated or dispersed. Individual
circumstances will determine the degree that will give the best overall
yield.
6. Unity of Direction: One plan of action to guide the organization.
According to this principle, each group of actives with the same
objective must have one head and one plan.

Background of Organizational Theory

Henri Fayol, developed a set of 14 principles:

7. Equity: Treat all employees fairly in justice and
respect.

Loyalty and devotion should be elicited from personnel by a

combination of kindliness and justice on the part of
managers when dealing with subordinators.

8. Order: Each employee is put where they have the

most value.

Breaking this into material and social order, Fayol follows

the simple adage of a place for everything and everything
in its place.

9. Initiative: Encourage innovation.

Initiative is conceived of as the thinking out and execution of a plan.

Since it is one of the keenest satisfactions for an intelligent man to
experience.

Background of Organizational Theory

Henri Fayol, developed a set of 14 principles:
10. Discipline: obedient, applied, respectful employees needed.
Seeing discipline as respect for agreements which are directed at
achieving obedience, application, energy, and the outward marks of
respect. Fayol declares that discipline requires good superiors at all
levels.
11. Remuneration of Personnel: The payment system contributes to
success.
Methods of payment should be fair and afford the maximum possible
satisfaction to employees and employer.

12. Stability of Tenure: Long-term employment is important.

Finding unnecessary turnover to be both the cause and the effect of

bad management, Fayol points out its dangers and costs.

Background of Organizational Theory

Henri Fayol, developed a set of 14 principles:

13. General interest over individual interest: The
organization takes precedence over the individual.
This is self explanatory when the two are found to differ,
management must reconcile them.
14. Team Spirit (Esprit de corps): Share enthusiasm or
devotion to the organization.
This is principle that in union there is strength as well as
an extension of the principle of unity of command,
emphasizing the need for teamwork and the importance of
communication in obtaining it.

Background of Organizational Theory

Now organizations are not viewed only

from the efficiency and opportunistic aspect
While analyzing organizations, the present
organizational theorists synchronize different
social, behavioral, cultural, and attitudinal
aspects in organizational relations.
Therefore, we need to analyze personal
and social traits of organizational members.

Theory of Planned Behavior and Theory of Reasoned Action

To learn human beings attitudinal and

behavioral traits, organizational behavior
study borrows theoretical paradigms from
sociology and psychology.
In psychology, the theory of reasoned
action (TRA) and planned behavior (TPB)
are designed to link between attitudes and
behavior.

Theory of Planned Behavior and Theory of Reasoned Action

Basically Theory of planned behavior (TPB) is

an extension of Theory of reasoned action
(TRA).
However, TPB also encompasses the concept
of perceived behavioral control, which
originates from Self Efficacy Theory.

Theory of Reasoned Action (TRA)

Why different people behave differently in the

same organizational context!!!
Researcher reveals that individual characteristics,
mediated by beliefs, affect attitudes and subjective
norms, which affect intentions and behaviors.
Behavioral attitude is dependent on some external
and internal factors including experience, personality,
and social values (Engel et al., 1993).
Subjective norms depends on influence of
associated persons
To conceptualize behavioral attitude, TRA was
proposed by Martin Fishbein together with Icek Ajzen
in 1975

Theory of Reasoned Action (TRA)

TRA has the following

constructs:
Subjective norm
Attitude, and
Behavioral intention
TRA suggests that a
person's behavioral
intention depends on
the person's attitude
about the behavior and
subjective norms (BI =
A + SN).

Ajzen and Fishbein

(1980) proposed that a
persons behavior is
determined by the
person's intention to
perform the behavior
and that this intention
is, in turn, a function of
the person's attitude
toward the behavior.

Theory of Reasoned Action (TRA)

Theory of Reasoned Action (TRA)

For different contexts, the magnitude of beliefs,
which in turn affect attitude, differs. So, these
constructs will be evaluated by a person's valuation of
the weight of these consequences.
One might have the belief that adopting modern ICT
is good for one's professional career. It enhances
efficiency and also effectiveness. However, it is time
consuming to learn and resources are also not always
available. Each of these beliefs can be weighted
based on ones perception of the merits of those
beliefs.

Theory of Reasoned Action (TRA)

Subjective norm is regarded as a

combination of perceived expectations from
relevant individuals or groups along with the
intention to comply with these expectations.
It is considered as the persons belief that
individuals or groups associated with that
person expect that the person should or should
not perform the behavior and the person's
expectation to comply with the specific
references (Fishbein and Ajzen, 1975).

Theory of Reasoned Action (TRA)

Associates of one individual might have

engaged in ICT-based projects.
They have enough skill and are advancing
their professional career by adopting ICT.
These associates have explicit and implied
influence on that individual's intention to learn
ICT.

Theory of Reasoned Action (TRA)

However, at the same time that individuals

brother might have had adverse
consequences in trying to adopt ICT in
professional life.
That brother may have devoted much time,
money, and efforts to learn IT and, ultimately,
could not pay back these investments.
So, he might discourage that person from
learning ICT.
This circumstance might have a negative
impression on that individuals decision
making about learning ICT.

Theory of Reasoned Action (TRA)

The beliefs of these people, weighted by

the importance of the individual attitude to
each circumstance/opinion, might
influence the persons behavioral intention
to use ICT, which in turn will affect that
persons behavior to learn or not learn ICT
in a professional career.

Theory of Reasoned Action (TRA)

So, a person's intention toward a specific

behavior is affected by the person's attitude
toward that behavioral outcome and the
attitude a person perceives other people
would have towards the performance of
that behavior.
A persons attitude, combined with
subjective norms, forms the person's
behavioral intention.

Theory of Reasoned Action (TRA)

From the review of TRA, we get the essence

that behavioral intention, a function of both
attitudes toward a behavior and subjective norms
toward that behavior can predict actual behavior.
A persons attitudes about learning ICT in
professional life combined with the subjective
norms about learning ICT in professional life,
each with their own weight, will determine
intention of learning ICT in professional life (or
not), which will then lead to the actual behavior.

Theory of Reasoned Action (TRA)

The validity of the TRA is
extensive within some
conditions
However, under
circumstances where
internal and external
factors might control or
affect the motivation of
the outcome of behavior,
TRA is a relatively poor or
partial predictor of those
types of behaviors.

For actual behavioral

outcome, it appears
not to be completely
voluntary and under
control; this resulted
in the addition of
certain external or
internal factors,
termed as perceived
behavioral control.

Theory of Planned Behavior (TPB)

With this addition, the theory was called the

TPB.
TPB is a theory that predicts intended and
rational behavior, because behavior can be
deliberative, organized, and planned.
Thus, TPB, which is an extension of TRA, was
developed to incorporate behavioral control
factors in predicting behavior.
This theory extends the incomplete concept of
TRA in predicting an actual behavior under the
influence of certain stimuli that intended
behaviors are also controlled by some
uncertainty.

Theory of Planned Behavior (TPB)

Therefore, performing a behavior depends

not only on intention but also on some external
or internal factors that may interfere with the
motivational behavior. These factors are called
as Behavioral control.
Behavioral control is conceptualized as one's
perception of the context of performing a
behavior.
This construct reflects a persons perception
of the presence or absence of external
favoring or non-favoring resources and
opportunities to perform a behavior of interest
(Barnett and Presley, 2004).

Theory of Planned Behavior (TPB)

TPB is sketched in the following diagram