ORGANIZATIONAL BEHAVIOR AND

LEADERSHIP
 1. Introduction
 We are born in organizations, educated by organizations
in organizations and most of us spend much of our lives
working in organizations.
 The family, where we spend most of our time, is also an
organization.
 Hence, an organization is a group of individuals who
agree to share their effort in the relation of common
goals.
Criteria to qualify organization
1) when there are persons who are able to communicate
with each other,
2) when there are people who are willing to contribute
collectively and individually,
3) when there are people who are desirous of satisfying
personal and social needs.
1. Introduction…
 The goals of an organization are derived from individual
goals, and hence, individuals in order to realize their goals
join an organization.
 Thus, the nature, size and purpose of organizations
influence individuals and their behavior.
 Organizations may be small, large, formal, informal,
political, social, economical, cultural or religious.
 Interaction of individuals in organizations is within the
scope of the structure and the structure itself defines the
authority, responsibility and communication relationship
among the people.
1. Introduction…..
• Man is a social being. Our family, which is a basic unit of
our existence, consists of father, mother, sisters and
brothers.
• Thus, family is a social organization set up together to
achieve a common goal.
• When we go to school, we spend time with other children
and teachers, and hence, school is also an organization.
• Even as employees, we spend much of our time in
organization contributing to it so that it could achieve its
goals.
• Of course, most of us spend much of our lives
associated with one or another organization.
1.1 DEFINITIONS
 “Organizational behavior is a field of study that investigates the impact
that individuals, groups and organizational structure have on behavior
within the organization, for the purpose of applying such knowledge
towards improving an organizational effectiveness’’.
 The above definition has three main elements;
 1ST organizational behavior is an investigative study of individuals and
groups,
 2nd , the impact of organizational structure on human behavior
 3rd,the application of knowledge to achieve organizational effectiveness.
 These factors are interactive in nature and the impact of such behavior
is applied to various systems so that the goals are achieved.
 The nature of study of organizational behavior is investigative to
establish cause and effect relationship.
Organizational Behavior…
 . . . a field of study that investigates how :-
 Individuals,
Groups and
 Structure affect and are affected by behavior within
organizations, for the purpose of applying such
knowledge toward improving an organization’s
effectiveness.
 Three Levels of Analysis in OB

The Three Main Levels of

Analysis

7
 Individuals are the foundation of organizations; the
way they work and behave results in business success
or failure.
 The role of managers is to integrate individuals into
the organization, nurture their skills and attributes,
and balance their needs and expectations accordingly.
 When managers do this successfully, individuals will
achieve high levels of job satisfaction, motivating
them to work towards attaining organizational goals.

8
 Teams or groups exist in all organizations, large or small, and
their effective functioning is essential to the success of any
organization.
 Groups are different from teams in that groups are collections of
people who don’t necessarily collaborate on the same project,
while teams do.
 Teams are complex because they consist of many different
personalities and attitudes.
 Managers who understand the dynamics of a team and the way
it is structured also better understand the underlying behaviors
of individuals within the group.
 A good example is the British football team “Manchester United”
whose players continually cooperate with each other in pursuit
of a common goal, in spite of well-documented personality
differences and the odd feud.
9
 Organizations provide individuals and groups with the
tools and systems to achieve objectives and goals.
 The attitudes and behaviors of employees are influenced
by the way organizations are structured.
 For instance, Google’s organizational structure is
centered around employees from all disciplines working
together to meet goals and generate innovative ideas.
 Google employees derive job satisfaction from a flexible
working structure that provides them the freedom to set
their own goals and standards.

10
 Organizational Components That Need To Be Managed
PEOPLE

STRUCTURE

TECHNOLOGY

JOBS

PROCESSES

EXTERNAL ENVIRONMENT

1. People
 People are the main component of any organization that has to be
managed.
 Every individual has a personal goal to be achieved.
 Organizations must identify the need spectrum of individuals and
take suitable steps for its fulfillment to enable them to perform
effectively so that they complete their allotted task in time
Organizational Components That Need To Be Managed ….
1. People …
 Relationship between the workers, with subordinates and
superiors should be established based on full understanding
and complete faith based on mutual trust
 So that it is easy to communicate and understand each other’s
views.
 B/se Work teams and Groups play a vital role in the
organization.
 Individual may have to keep his personal interest aside if it
conflicts with team or group goals.
 Organizational Components That Need To Be Managed ….

2. Structure
 There are two types of organizations, formal and informal.
 Informal organizations do not have a specified structure.
 Formal organizations are building based upon the objective set for it.
 Organizational structure in such organization is hierarchical in
nature, with people at each level having their own objectives, which
contributes towards fulfillment of overall organizational objectives.
 In such organization, people at lower levels report to higher level
managers.
 The tier system has the principle of unity of command inbuilt in it.
Organizational Components That Need To Be Managed ….
2. Structure …
 The organization structure may depend upon the size,
number of products/services produced, skill and experience
of the employees, managerial staff and geographical
location of the organization.
 An organization may have several levels and pyramid like
organizational structure or flat structure.
 The efficiency of the organization will depend upon the
free flow of the information, efficient communication
system prevailing in the organization, well-defined
authority and responsibility supported by detailed policies,
rules and regulations
Organizational Components That Need To Be Managed ….
 2. Structure
 The organization must have well laid out systems, which are
understood by workers, supervisors and managers.
 The leader must keep open mind while dealing with
subordinates and exercise full control over various systems,
levels and ensure planned productivity and achieve high level of
job satisfaction.
3. Technology
 Managing technology is an important job of any management.
 It is an important element of any unit.
 Selection of technology, procurement, installation, operation and
maintenance is important and no compromise should be made in
procuring latest or advanced technology.
Organizational Components That Need To Be Managed ….
3. Technology
 Various systems and sub- systems should support technology that

exists in an organization.
 Based on the technology, an organization should formulate job

structure and resultant procurement of human resource so that

they are complimentary to each other.
 Adequate attention is also be paid to service industry.
 For example an appropriate drill, procedures are installed in

hospital industry to ensure that the patients’ record is maintained

properly.
 In minimum number of days, maximum numbers of patients

should be treated.
 Various processes required to regulate these functions form the

important part of service industry.

Organizational Components That Need To Be Managed ….

4. Jobs
 Job is an assignment assigned to an individual.
 It encompasses various tasks within it.
 This may form a part of managerial functions.
 Adequate delegation, supervision, application of various
control techniques makes the job simpler for the manager
 Job will have various tasks inbuilt in it like designing
of job specification, selection of media, advertising
vacancies, scheduling of selection and recruiting
process.
 Manager, therefore have to manage various tasks to
accomplish a particular job.
 Organizational Components That Need To Be Managed ….
4. 5. Processes
 Management of processes and its inter-dependence is very
crucial to high productivity and higher job satisfaction.
 What is important for a manager is to ensure high morale of
the work force.
 Select appropriate subordinates to carry out a job based on
aptitude, personality traits, mental build up and attitude.
 Various role models assist leaders in identifying as to which
process, method or approach would be suitable to mould
subordinates in suitable frame that may be required by any
organization
 To ensure this, he must identify various managerial dictums
 .
Organizational Components That Need To Be Managed ….

6. External Environment
 What we have so far discussed is various components of an
organization that should be managed properly.
 External environment also plays an important role in managing
the points discussed above.
 When we talk about managing people in the organization, what
we have to study and manage is the influence of culture and its
impact on the individual.
 A manager should examine as to how he is going to cope - up
with the changes
 Study of external environment is very wide and encompasses
economic, cultural, social, government rules and regulations,
legal aspects, political climate, demographics and its impact.
Organizational Components That Need To Be Managed ….
6. External Environment
 It is therefore important to evaluate market situation,
competitors, and availability of raw material, technology,
availability of skilled, semi skilled and non-skilled personnel.
 In addition, evaluate prevailing culture and how individuals
are likely to respond to the call of the organization.
 Some factors like government rules, and political stability
keep changing, the organizations must cater for such
contingencies.
 Manager must therefore keep in mind the internal and
external factors and make the best amalgam and work to
achieve organizational effectiveness.
 If the above factors are evaluated appropriately, a manager
will be able to examine and predict human behavior in the
organization
Major Characteristics of OB
1. Interdisciplinary.
 Organizational behavior is interdisciplinary orientation that
integrates behavioral sciences in understanding behavior and
performance.
 It draws heavily on knowledge about behavior generated in the
social sciences of psychology, sociology, and anthropology.
2. Behavioral Science Foundation.
 The behavioral sciences—psychology, sociology and
anthropology have provided the basic philosophy, characteristics
of science, and principles that are so freely borrowed by the field
of organizational behavior.
 The social sciences of economics, political science, and history
have had a secondary impact on the field
 Major Characteristics of OB…
3. Scientific Method Foundation.
 OB had inherited the tradition of scientific method in its

investigations from its parent disciplines.

 The scientific methods emphasize the use of logic and theory in

formulating research questions and the systematic use of

objective data in answering such questions.
1. Three Levels of Analysis.
 The OB is unique in its approach to behavior because it

encompasses three levels of analysis, individual, group, and

formal organization.
 In addition, all three levels are treated with equal importance and

needs to be scientifically studied.

Major Characteristics of OB…
5. Contingency Orientation.
 The term contingency orientation reflects the need to consider
the situation and individuals involved before drawing
conclusions about behavior.
 The OB field has no universally applicable set of prescriptions
for managers.
6. Concern for Application.
 The OB researcher must always be concerned with
understanding real events in actual organizations and with
communicating results in a meaningful fashion to practicing
managers.
 THE DEVELOPMENT OF ORGANIZATIONAL BEHAVIOR
Management is a relatively new field of study, having emerged
only within the last 100 years.
Key contributors to scientific management included Frederick W.
Taylor, Frank and Lillian Gilbert, Henry Gantt, and Harrington
Emerson.
 Taylor identified a phenomenon he called “soldiering” – the
practice of working considerably slower than one can.
Classical organization theory focused on how organizations can
be structured most effectively to meet their goals.
 Key contributors to classical organization theory included Henri
Fayol, Lyndall Urwick, and Max Weber.
The bureaucracy model, as described by Weber, was an early
universal approach to organization structure.
 In ideal form, a bureaucracy is logical, rational, and efficient
 The Development of Organizational Behavior ….

• Robert Owen, Hugo Munsterberg, and Mary Parker Follett were

among the first to recognize the importance of individual
behavior to organizations.
• The Hawthorne studies, conducted between 1927 and 1932, led
to some of the first discoveries of the importance of human
behavior in organizations. the human relations movement
emerged.
• Human religionists believed that employee satisfaction is a key
determinant of performance.
• A prominent human relations writer, Douglas McGregor,
developed the concepts of Theory x and Theory y.
• Theory x takes a negative and pessimistic view of workers,
Theory y a more positive perspective.
• McGregor advocated the adoption of Theory y.
 The Development of Organizational Behavior ….
• For managers universal principles provide ready guides to action in
all situations.
• Some of the early writing predating the field of OB is of this universal
type.
• For example, Max Weber prescribed the use of a highly structured
bureaucracy for all organizations.
• His prescriptions were succeeded in the 1950s and 1960s by an
equally prescriptive set of guides that argued the opposite.
• Rennis Likert and McGregor, for example, advocated it from fearless
formality.
• Unfortunately, as most practicing managers soon learn the real world
is not so simple and refuses to lend itself to universal theories and
principles.
• Abraham Maslow, another pioneer in the human relations movement,
developed the well-known hierarchy of human needs.
 The Development of Organizational Behavior ….
• Organizational behavior began to emerge as a mature field of study
in the late 1950s and early 1960s.
• Contemporary organizational behavior has an interdisciplinary
focus, drawing from fields such as psychology, sociology, and other
related areas.
• Organizational behavior attempts to describe relationships between
two or more behavioral variables.
• Basic concepts of organizational behavior can be divided into three
basic categories: individual processes, interpersonal processes, and
organizational processes and characteristics.
 The Development of Organizational Behavior ….

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. Scientific .Bureaucrac .Group Decision Socio- Contingenc .Global

& y Human Dynamic making technical y Manageme
classical Relations approaches; Systems theory nt
manageme leadership theory • Internet
nt technologie
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•Quality,
speed,
customer
focus
• Diversity
• Ethics
1910 – 1920s 1940s 1950s 1960– 1980s 1990 –
1920s 1970s 2000s
 The Development of Organizational Behavior ….
• Modern theory is a sophisticated and scientific way of
describing a complex organization.
• This theory has developed two major dimensions-systems
dimension and contingency dimension.
• Based on these orientations, modern organization theory can
be classified into two categories:
(1) Systems theory/approach and
(2) Contingency theory/approach
 The systems theory visualizes organization as a system
consisting of interacting parts.
 Specifically, the open-systems concept, which stresses the input-
output analysis, has a marked impact on modern theory.
 System analysis has its own peculiar points under which
organization is considered as a system of mutually dependent
variables.
 The Development of Organizational Behavior ….
• Social scientists, management thinkers, operation researchers,
psychologists and others, all unanimously agree that
organizations are systems.
• Charles Perrow concludes, “On one thing all the varied school of
organization analysis now seemed to be agreed; organizations
are system-indeed, they are systems.”
• Modern organization theory has its origin from the general
systems theory, which is associated with the name of Kenneth
Boulding.
• Boulding worked on various systems from simple to complex.
• He classified various systems as below:
1. The Static Structure. It also refers to the level of framework.
The anatomy of the universe is good example to this system.
2. The Simple Dynamic System. It incorporates necessary
predetermined motions.
 various systems cont….
3. The Cybernetic System. It is like a thermostat where there is
automatic feedback control mechanism.
4. The Open System. It is a self-maintaining structure.
5. The Genetic Social System. It is generally typified by the
plant and pre-occupies the empirical work of the botanist.
6. Animal System. It is characterized by the increased mobility,
technological behaviors, self unawareness, and goal-oriented
approach.
7. Social System. Here social organizations are formed and
individuals assume organizational goals.
• The general system theory of Boulding has been criticized by
Von Bertalanffy on the ground that it is descriptive rather
than a strictly logical and prescriptive
 various systems cont….
• Von Bertalanffy is credited with coining the “general systems
theory”.
• However, the recent social scientist Scott contends that
modern organization theory and the general systems theory
are close together.
Contingency approach
• It is based on the modern theory of organization.
• It is an attempt to provide something more useful to the
practicing managers in the present day complex organizations.
• It seeks to understand the inter-relationship within and
among organizational subsystems, as well as between the
organized systems.
• Contingent approach strongly believes that there is no
prescribed organizational design, which is appropriate to all
situations
Scientist theories and concepts …..
 Such results contribute to the organization’s progress toward
its goals.
 Dysfunctional consequences are results of behavior that have
a negative effect on the organization.
 These results restrict the organization adjustment and
adaptation, impeding it from reaching its goals.
1.7 CONTRIBUTING FIELDS TO ORGANIZATIONAL
BEHAVIOR

• PSYCHOLOGY
• SOCIOLOGY
• POLITICAL SCIENCE
• SOCIAL PSYCHOLOGY:
• ANTHROPOLOGY
• ECONOMICS STUDY
• MEDICINE
• ENGINEERING
 Contributing Disciplines
Psychology seeks to
measure,explain,
and change
behavior
Sociology studies
people in relation to their
fellow human beings

Social psychology
focuses on the
influence of people
on one another

Political science is the

Anthropology is the
study of the
study of societies
behavior of individuals
to learn about human
and groups within
beings and their activities
a political environment35
 Contributing Fields to Organizational Behavior….
1. Psychology:
 Psychology is an applied science, which attempts to explain
human behavior in a particular situation and predicts actions
of individuals.
 Psychologists have been able to modify individual behavior
largely with the help of various studies.
 It has contributed towards various theories on learning,
motivation, personality, training and development, theories on
individual decision making, leadership, job satisfaction,
performance appraisal, attitude, ego state, job design, work
stress and conflict management.
 Studies of these theories can improve personal skills, bring
change in attitude and develop positive approach to
organizational systems.
 Psychology……
• Various psychological tests are conducted in the organizations
for selection of employees, measuring personality attributes
and aptitude.
• Various other dimensions of human personality are also
measured.
• These instruments are scientific in nature and have been
finalized after a great deal of research.
• Field of psychology continues to explore new areas applicable
to the field of organizational behavior.
• Contribution of psychology has enriched the organizational
behavior field.
 Contributing Fields to Organizational Behavior….
2. Sociology:
 Science of Sociology studies the impact of culture on group
behavior and has contributed to a large extent to the field of group-
dynamics, roles that individual plays in the organization,
communication, norms, status, power, conflict management, formal
organization theory, group processes and group decision-making.
3. Political science:
 Political science has contributed to the field of Organizational
behavior.
 Stability of government at national level is one major factor for
promotion of international business, financial investments,
expansion and employment
• Various government rules and regulations play a very decisive
role in growth of the organization. All organizations have to
abide by the rules of the government of the day.
 Contributing Fields to Organizational Behavior….
4. Social psychology:
 Working organizations are formal assembly of people who are
assigned specific jobs and play a vital role in formulating human
behavior.
 It is a subject where concept of psychology and sociology are
blend to achieve better human behavior in organization.
 The field has contributed to manage change, group decision-
making, communication and ability of people in the
organization, to maintain social norms.
5. Anthropology:
 It is a field of study relating to human activities in various
cultural and environmental frameworks.
 It understands difference in behavior based on value system of
different cultures of various countries
 Anthropology…
• The study is more relevant to organizational behavior today due
to globalization, mergers and acquisitions of various industries.
• The advent of the 21st century has created a situation wherein
cross-cultural people will have to work in one particular industry.
• Managers will have to deal with individuals and groups belonging
to different ethnic cultures and exercise adequate control or even
channelize behavior in the desired direction by appropriately
manipulating various cultural factors.
• Organization behavior has used the studies on comparative
attitudes and cross-cultural transactions.
• Environment studies conducted by the field of anthropology aims
to understand organizational human behavior so that acquisitions
and mergers are smooth.
• Organizations are bound by its culture that is formed by human
beings
 Contributing Fields to Organizational Behavior….
6. Economics
• Study the production, distribution, and consumption of goods
and services.
• Students of organizational behavior share the economist's
interest in areas such as labor market dynamics, productivity,
human resource planning and forecast­ing, and cost-benefit
analysis.
7. Engineering
 It has also influenced the field of organizational behavior.
 Industrial en­gineering in particular has long been concerned
with work measurement, productiv­ity measurement, work
flow analysis and design, job design, and labor relations.
 Contributing Fields to Organizational Behavior….
8. Medicine
• Most recently, medicine has come into play in connection
with the study of human behavior at work, specifically in the
area of stress.
• Increasingly, research is showing that controlling the causes
and consequences of stress in and out of organizational set­
tings is important for the well-being of both the individual and
the organization
 Organizational Behavior in the 21st Century

• Information technology is a major force driving change.

• We are experiencing the rapid integration of information across
all industries everywhere, yet it is still people who invent, direct,
guide, and manage change in their own careers and in the
boundary less organization.
• This text relates organizational behavior topics to managing
dynamic body of knowledge that can be used to understand
and manage a wide technological change as a driver of
performance and integration’
• Business @ the speed of thought” is a major factor of
competitive advantage.
• Another set of success factors that lead to competitive
advantage are developing and sustaining world-class products
and services with Internet speed and meeting and exceeding
customer demand.
 Organizational Behavior in the 21st Century….

• Organizations are adapting by reengineering, reinventing,

restructuring, and rethinking their strategies, structures, and
expertise around web-based, Internet integrated business
processes.
• Not all organizations are changing at the same pace or on the
same scale.
• However, Internet-driven networks and software applications
have produced a type of “digital Darwinism”.
• The information-based organization has knowledge workers
who are specialists and who resist command-and-control
procedures based on the military model.
• Everyone takes responsibility in these workplaces.
• Structures become flatter. Clear, simple, common objectives
that lead to action are required
 Organizational Behavior in the 21st Century….
• Changing managerial unified vision in the organization;
devising a management structure for task forces; and
ensuring the supply, preparation, and testing of top
management people.
• Finally, because of the internationalization of business and
continuous merger, acquisition, and divestiture activities, yet
another aspect of managerial work is being revised.
• Rosabeth Moss Kanter calls the new managerial work and
practices “post-entrepreneurial” because “they involve the
application of entrepreneurial creativity and flexibility to
established businesses”.
• Post-entrepreneurial practices include managers involving
themselves in networks outside individual empires and
thinking cross-functionally and strategically to contribute to
other faces of the business.
 Organizational Behavior in the 21st Century….
• The era of the boundary less or seamless corporation has
arrived.
• Emphasis is placed on developing co-operative relationships
among internal, external, and virtual teams who are part of an
expanding economic (or what may become a “Webonomic”,
i.e., Internet integrated) enterprise.
• High-performance teams are organized with empowered
individuals who work creatively to add value to their company
as well as to their units.
• Knowledge of organizational behavior and a repertoire of
people skills are essential in building and sustaining face-to-
face and virtual relationships.
 Organization as a System
• The systems approach to organizations provides a useful
framework for understanding how the elements of an organization
interact among themselves and with their environment.
• Various inputs are transformed into different outputs, with
important feedback from the environment.
• If managers do not understand these interrelations, they may tend
to ignore their environment or to overlook important
interrelationships within their organization.
• This is consistent with our earlier description of management
functions).
• The organi­zation's managers then combine and transform these
inputs and return them to the environment in the form of products
or services, employee behaviors, profits or losses, and additional
information.
• Then the system receives feedback from the environment
regarding these outputs.
 Organization as a System….
• Through complex refining and other processes, these inputs are
combined and transformed to create products such as gasoline
and motor oil.
• As outputs, Shell sells these products to the consuming public.
• Profits from operations are fed back into the environment
through taxes, investments, and dividends; losses, when they
occur, hit the environment by reducing stockholders' incomes.
• In addition to having on-the-job contacts with customers and
suppliers, employees live in the community and partici­pate in a
variety of activities away from the workplace, and their behavior
is influenced in part by their experiences as Shell workers.
• Finally, information about the company and its operations is also
released into the environment.
 Organization as a System….
• The environment, in turn, re­sponds to these outputs and influences
future inputs.
• For example, consumers may buy more or less gasoline depending
on the quality and price of Shell's product, and banks may be more
or less willing to lend Shell money based on financial information
released about the company.
• The systems perspective is valuable to managers for a variety of
reasons.
• First, it underscores the importance of an organization's
environment.
• Failing to acquire the appropriate resources and to heed feedback
from the environment, for instance, can be disastrous
• The systems perspective also helps managers conceptualize the now
and interaction of various elements of the organization as they enter
the system, is trans­formed by it, and then re-enter the environment .
•Thanks!!!