MBA management

Introduction to Organizational Behaviour

Historicism


The traditional outlook viewed the employee as just a ‘spoke’ in the organizational ‘wheel’. In fact till the end of eighteenth century, an employ working in an organization was considered to be one among the five ingredients of it: men, machine, material, money and management. It was highly a materialistic outlook.

It was the beginning of the nineteenth century that brought in some changes in this view. Thanks to the paternal attitude of some of the entrepreneurs and factory Owners like Robert Owen, social scientists started showing interest in studying the behavior of people and groups (formal & informal) in the organizations.

Organizational behaviour is a scientific and systematic study of the behavior of the people and the groups (both formal and informal) in organizations. According to Kelly, it is the study of the behavior and attitudes of man in an organizational setting; an organization’s effect on his perceptions, feelings and actions, and his effects on the organization, particularly how his behavior affects the achievement of organization’s purposes. Otherwise speaking, there is a constant interaction among the organizational structure, people and the technology.

Of all the inputs that make the organization working, humans are the most important ones. In India the study of organizational behavior has a tremendous scope to offer. The history of human and organizational behavior in industries, organizations, companies and factories in India has an interesting evolution. From a rigid, colonial, hierarchical set-up of formal top- down approach, it has now come to shoulder- rubbing informal approach.

The modern history of organizational behavior dates back to the World War I. Most of the psychological tests applied in recruiting the army personnel were later applied to industrial recruitment. Hence the instruments used in testing and rating had their origins in the psychologists” activities in the World War I.

In the post – war scenario, Proctor & gamble, Philadelphia Company and hawthorn plant of western Electric plant had their own research groups studying the industrial psychology. The great Depression.

American association of Applied Psychology, and the World War II had a great impact in shaping the industrial psychology. This got enhanced by the development of various training programs, job analysis and performance appraisal techniques.

Frederick W Taylor’s Scientific Management’ looked into the relationship link between the worker, supervisor and the management. He created an awareness on parity of wages, supervisory training and financial incentives.

The Nobel Prize winning French engineer- turned- executive Henrry Fayol, heading the largest coal-mining firm in Europe, wrote the first book on management. His book did not consider an organization made up of people.

Organizational behavior is built on the empirical studies of human behavior in formal and informal work- settings or organizations.

Fred Luthans observes that the Great Depression, the Hawthorne illumination studies and the emergence of trade unionism brought in the concept of ‘human relations movement.’

The ‘great Depression’ made the managers to shift their focus from production to personnel. The offshoots of the Great depression like unemployment, poverty and insecurity drew the attention of the manager to address them first.

Though the workers union were existing in U>S>A> since 1792, it was the Wagner Act of 1935, which recognized the role of organized labour movement.

The Hawthorne--- Harvard research findings (The name came from prof. Elton Mayo and his associates ‘guidance in the research findings from the Hawthrone works Department of Western electric co., which was earlier studied by the National council of the National academy of Sciences, called ‘Illumination studies) recognized the human factor in industry, taking into account the employee attitudes, his social situation on the job and his personal history and background.

In 1924, the Hawthorne Works of the western electric Co. Chicago, having 30,000 workers, manufactured the equipment for the bell telephone system. Inspite of numerous schemes beneficial to the employees, there was a growing discontent among them. After having failed in its investigation, the company approached the National academy of sciences. It studied the relationship between the illumination in the shop floor and the worker efficiency. Hence it came to be known an ‘Illumination to observe its effects on the dependent variable, i.e., productivity. The studies highlighted that there was something much more important than wages, work-hours, working conditions, etc. which influenced productivity.

This was followed by ‘relay Room experiments’ in 1927, in which Elton Mayo and his Harvard colleagues found that there was no cause and effect factor between the independent variables like rest and the dependent variable, viz productivity.

Followed by this were the ‘second Relay room Experiment’ and ‘mica splitting study’. Both these experiments revealed that the wage incentive was not the sole factor affecting the worker.

Between 1928 and 1930 the Hawthorne researchers conducted a mass interviewing programme in which 21,000 interviews were held with a view to improve the supervisory training.

In 1931 and 1932, ‘bank wiring Room study’ was conducted to drive home the fact attempts should be made to see that the interest of the management and workers are one and the same so that the informal groups help achieve organization’s objectives.

As this was the case with USA>, in India it was a sea change that engulfed the shores of the industries, factories and organizations. 19th and the first half of the 20th centuries witnessed a very rigid, colonial set-up, along with a Hindu undivided family management control of the organization. It was the Trade Union Act 1936 which made the laborers feel a little relieved. In 1929, the govt. appointed officers to solve labour and welfare problems. In 1948, the section 49 of the factories Act ensured the appointment of welfare officers in companies having more than 500 workers.

The organizational behavior as a field of study came into existence during the second half of the 20th century.

Current scenario

The last few decades of the 20th century ushered in two tremendous transformations in India and also at the global level: IT revolution and LPG (Liberalization, Privatization and Globalization). Thy had serious and far – reaching impact on Organizational Behaviour, thanks to the MNC ‘s bringing in a flexi- office 9 transnational, beyond boundary / border corporations), and also flexi-time, making inroads into individual behavior, aims, life-style, expectations, etc., As borders, boundaries, cultures transfuse, defining or writing about Organizational behavior becomes more complex. These divergences pose problems in defining power, politics, role, value, task, culture, etc. hence organizations are under continuous pressure to learn more and more about restructuring , reengineering , organizational learning, change, development, etc. advancement in technology reduces the size of the organizations. Thanks to increased automation in offices, the focus shifts from groups to individuals. The centralized authority gets decentralized. Leadership gets spread to groups in decision making.

SHIFT -> PRINCIPLE
i) Fat to lean -> In staffing
ii) Vertical to horizontal -> In organization
iii) Homogeneity to diversity -> In work force
iv) Status and rights to expertise and relationship -> In power source
v) Company to project -> In loyalty
vi) Organization to reputation -> In career asset


Kanter anticipated six important paradigm shifts in the 21th century organizations:


Definition
Organizational Behaviour focuses on understanding, forecasting and controlling behavior at work-place to ensure effective performance. Organizational behavior considers organizations as social systems.

Primarily a person’s behaviour is based on his goals. Otherwise speaking, a person’s behavior is based on his personality. Personality is in the subconscious mind of a person.

People behave depending on their motives. Motives are goal—directed. Psychologists call ‘goals’ as ‘incentives’. They are ‘extrinsic’ and intrinsic’, ‘Extrinsic incentives are salary, perks, promotions, allowances, etc. ‘Intrinsic incentives ‘ are appreciations, recognitions, autonomy, facilities etc. thus organizational behavior is the humanistic and behavioral approach to management. It pays attention to people in the organization.

Organizational behavior is dependent partly on the requirements of the formal organizational structure and hierarchy, and partly by the personal attitudes and behavior of the individuals forming the organization. The behavior that emanates from this interaction denotes the field of Organizational behavior.

1.2 Some definitions on Organizational Behaviour

1. “Organizational behavior can be defined as the understanding, prediction, and management of human behavior in organizations.”
_ Fred Luthans, Organizational behavior. New Delhi; Mc Graw—Hill; 2002.p. 23.

2. “Organizational behavior represents the human side of management, not the whole of management.”
_ Fred Luthans, Organizational Behavior. P-24.

3. “Organizational Behavior is the study and application of knowledge about how people act within organizations. It is a human tool for the human benefit. It applies broadly to the behavior of people in all types of organizations such as business, government, schools, etc. It helps people, structure, technology, and the external environment blend together into an effective operative system.”
_ Keith Davis in Human Behavior at Work

4. “Organizational behavior can be regarded as a systematic attempt to understand the behavior of people in organizations of which they are an integral part.”
_ R.A. Sharma, Organizational Theory and behavior. New Delhi: Tata Mc Graw -- Hill. P.9.

Organizational Behaviour System & its Theories

Another view of organization could be seen as a system. An organization is a social system. Understanding, forecasting, controlling and monitoring behavior at work is necessary, so as to ensure effective performance of this system. Organizational Behaviour is concerned with these activities.

All the people working in an organization are also the members of the society/ community from which they come. Hence organization becomes a social system, where the value systems, practice and custom confirm to those of the society/ community that those members belong to, Any organization that has inconsistent value system with the outside world or external community does not static. All the subsystems of the organizational system are interdependent and they are interacting with and influenced by the other subsystems of the organization, as well as the outer world / community/ society.

Let us consider some of the sets of theories that have theories that have affected the study of organizational behavior. At least, three sets of theories have wielded their influence on the study of Organizational behavior.

Cognitive School
This school believed that the human behavior is controlled by the through process. Edward Tolman pioneered the cognitive school of thought, claiming all behaviour is goal directed. He believed that a person was well aware of this goals and ways of acquiring them. H was of conviction that behavior could be taught to an individual. This means that learning teaches ‘expectancy’. ‘Expectancy’ is a kind of knowledge that a particular action or event will lead to a particular outcome. If a human being knows the outcomes in advance, he will take initiatives to achieve these outcomes.

Behavioural School
a) Stimulus – response; This school of thought emphasized the need to act on the basis of observing a particular behavior. Ivan Pavlov and John B. Watson, as this behavioral framework of thought suggested that behavior can be best understood on the basis of stimulus and response. A stimulus evokes a particular response.

b) Response_ stimulus: B.F Skinner, father of modern behaviorism believed that response led to stimulus. He opined that the organism has to operate on the environment to receive the desired consequences. For this school of thought, behavior is a function of its contingent environmental consequences. Otherwise speaking, behavior is a result of the consequence it is likely to produce.

Social Learning/Social cognitive School
Albert Bandura, Davis, Fred Luthans and Kreitner provided the conceptual frame work for this approach. Social learning, as Fred Luthans observes, takes the position that behavior can best be explained in terms of a continuous reciprocal interaction among cognitive, behavioral and environmental determinants. The theoretical foundation of the Organizational behaviour is based on this social cognitive theory approach. The social learning approach integrates the earlier discussed approaches in it. Hence bandura claimed that behavior emanates out of interaction between cognitive, behavioural and environmental variables. It is a more comprehensive framework.

Organizational Behavior Model


As the social cognitive school incorporated the cognitive, behavioristic and social approaches, Fred Luthans mad use of this as the basis for creating an organizational behavior model.

It is known as SOBC (S- Stimulus/ Situation; O- Organizational participants/ organism; B- Behaviour; c- consequences) model.

This model identifies and deals with major variables and their interrelationships.

This is considered to be more comprehensive than cognitive & behavioral models because it incorporates all the four sides--- environment ©, Organizational Behaviour (B), Organizational participants’ organic elements, viz. elements, viz. cognition(O), besides the situation which stimulates (S).

Industrial Behavior

Industrial behavior is dependent on various integrated and interactive subsystems viz. the industrial acts, norms, industries infrastructure, industrial security, industry’s hierarchy, laborer’s education, HR personnel’s training and development, social security system, social comforts, trade union, group behavior, work groups, societal norms, outside environment, and environmental forces 7 norms. The only purpose of studying the industrial behavior is to ensure the industries or organizational effectiveness.

An industry is a planned, well organized, co – ordinated system, made up of several interacting and interdependent subsystems that ensure production of goods and services. In order to set those goods and services in a cost- effective, time- efficient manner we need a regulated, well- oiled industrial behavior.

Understanding the industrial psychology and behavior helps the HR department to work more efficiently and effectively. Industrial behavior is affected by the environmental changes which include politics, societal demands and unionizations. Industries look more into the industrial behaviour to make them more productive. This is quite essential because the work behavior in shop floor is found to influence, tremendously, on the job performance.

Keith Davis’ systems/ Models

Keith Davis identified 4 different systems/ models of industrial behavior in Organizational behavior. These systems reveal the evolution of the managerial thinking & managerial behavior. These systems also denote the workers’ and employees’ reaction to the managerial orientations. They also tell us the general climate of the industrial behavior and the employer- employee relational aspects.

These models / systems are Autocratic, Custodial, supportive & collegial. The following tabular representation tells us how these systems look at a glance.

Name of The model   Source   Managerial Back-up   Employees Back-up   Employee Psychology   Employee Needs Satisfaction   Employee Performance
Autocratic   Power   Authority   Obedience   Dependence on Manager   Maintenance   Minimum
Custodial   Monetary   Vitamin ’M’   Security   Dependence on industry   Subsistence   Passively cooperative
Supportive   Leadership(inspire)   Supportive   Job Performance   Participation   To a great extent(Higher esteem)   Goal driven & operative
Collegial   Partnering   Team spirit   Responsibility   Self-Discipline   Self-actualization   Enthusiastic


Historical Evolution

(i) The industrial revolution & the immediate post- industrial revolution era faced the autocratic model, where the employees & workers were seen part of the machinery. The employer was autocratic.

(ii) Thanks to the Scottish Mill owner Robert Owen, the paternalistic tendency crept into the arena. Hence concessions were given in working hours, age limit, etc. This gave rise to custodial system of thinking. The employer was a benevolent autocrat.

(iii) The third evolution, viz. the supportive model was the offshoot of human- relationship tendency which gained currency during this period. In this paradigm, the manager is seen as a team- head / leader than an autocrat or a boss.

(iv) The fourth dimension of the history of the evolution of industrial behavioural climate is labeled ‘collegial’ because of the collegium of scientific and professionally trained employers. The manager takes part in the realization of the objectives of the organization, along with other workers, and the aspects of behavior in an organization, from dress code to skillset is learned by involving every employee in the learning process, his/her behavior can be observed, analyzed, maintained and monitored so as to improve their performance.

A learning theory, when it is paradigmed, becomes handy for any developmental academic to teach or for giving training or orientation. The widely accepted theoretical frameworks of learning include the behaviouristic, cognitive and social learning theories.

Behaviouristic or Connectionistic Theories
Classical behaviourists like Ivan Pavlov from Russia and john B Watson from America consider learning as an association or connection between stimulus and response (S-R). ‘Operant behaviorists’ like B.F> Skinner from the USA pay “more attention to the role that consequence play in learning” (Fred Luthans, p. 538), i.e., the response—stimulus (R-S) of the employees.

Learning & Motivation


Learning in Organizational Behaviour is characterized as a change in behavior as a result of an experience. It is not easy to measure learning directly. It can be seen by observing the changes it brings about in the behavior of a person after an experience. A change is an attitude/ approach unaccompanied by a behavioural change is not considered as a learning ( experience).The change in behavior, learning is defined as an outcome of an experience which is got i) directly from one’s own observations, experiences, practices or customs, or ii) indirectly by other’s reporting their experiences.

Practically speaking, all the aspects of “Organizational behavior is directly or indirectly affected by learning” says Fred Luthans in his book Organizational behavior (p. 537). As these theories emphasize the connection between stimulus ---response and response – stimulus, they are known as ‘Connectionist Theories ‘S-R- relationship is seen as ‘Classical or respondent conditioning’ R-S is “instrumental or operant conditioning.’

Classical Conditioning Theory

Pavlov, through his famous study on dog’s behavior, brought/ out this theory. When he gave a piece of meat to dog 9 an unconditioned stimulus), he found an increase in saliva (unconditioned response). When he rang the bell (a neutral stimulus), the dog did not salivate. In the next part of his experiment, he linked the meat to the ringing of the bell> After repeating this several times (i.e., hearing the bell before getting the met), the dog began to salivate on hearing the sound of the bell itself. Hence Pavlov proved to the world that the dog got “classically conditioned’ to salivate. Otherwise speaking, a ‘conditioned stimulus’ of the bell- sound evoked a ‘ conditioned response’ of dog salivating.

Examples of Classical Conditioning

Stimulus(S)   Response(R)
A shoe is thrown at a person   He shies away
A person is picked with a nail   He reflexively flinches
A bombarding sound is heard by a person   He shudders


Though the classical conditioning has wide spread application in marketing and buyer behavior, skinner believed that classical conditioning explains only respondent or reflexive behavior. Hence he rejected the S_R psychology, saying common human behaviors are far more complex than classical conditioning. Accounting to Skinner, ‘behaviour was a function of consequences’, and it can be learnt only through ‘operant conditioning’.

Operant Conditioning

Skinner said behavior is voluntary in nature. Repetition of a specific behavior is influenced by ‘reinforcement’. Reinforcement is a method to strengthen a particular behavior by rewards. Reward like pay rise, greater autonomy or appreciation would improve productivity (i.e., desired behavior).

The theory underlying this is that behavior is a function of its consequences. The tendency to repeat a particular behavior is influenced by reinforcements. When a behavior is punished (negative reinforcement) it is not repeated. Hence skinner proved the world that ‘Operant conditioning can be used to induce ‘desired behaviour’ in the industries and organization.

Reinforcements are either continuous or intermitted in their schedule. In ‘continuous schedule’ the desired behavior is reinforced each time it is repeated, In ‘intermittent schedule’, reinforcement in applied only at intervals.

‘Intermittent reinforcement’ may take either take either a ‘ratio’ or an ‘interval’ type. ‘Ratio’ means a specific no of times. ‘Interval ‘means after a specific time span. Interval could be ‘fixed’ or ‘variable’. In ‘fixed intervals’ the reinforcement cannot be predicted. For example, the surprise check by higher authorities is of this type. Variable types are viewed to be better than continuous types.

Cognitive Theories

Edward Tolman viewed cognitive learning to have a relationship between cognitive environmental cues and expectation. He believed that a stimulus usually leads to another stimulus. This was in sharp contrast to the earlier view that a stimulus leads to a response (S-R), and a response leads to a stimulus (R-S). Tolman’s view was, stimulus leads to another stimulus (S-S).

Wolfgang Kohler’s experiment with chimpanzee and suspended banana from above, proved that chimpanzee could use its ‘insight’ to drag a box under the suspended banana and climb on it to take the fruit. This Kohler called ‘insight’. Hence Bertrand Russell opined that “there are two ways of learning, one by experience, and the other by what Kohler calls ‘insight”(Bertrand Russell, An Outline of Philosophy, meridian, New York, 1960).

Post –war industrial training programmes were designed to strengthen the relationship between ‘cognitive payments for good performance. In Organizational Behaviour, the cognitive theories are applied to ‘motivation.’

Social learning and social Cognitive Theory

Social Learning Approach
It combined behaviorist and cognitive concepts and emphasized the reciprocity of cognitive, behavioural and environmental determinants. This theory is based on classical & operant conditioning. It believes that learning takes place by modeling and self- control processes.

Social Cognitive Theory
It believes in self- regulatory mechanisms. It identifies 5 capabilities that develop in their behavior: “(1) symbolizing, (2) forethought, (3) modeling, (4) self-regulation, and (5) self – regulation. These human capabilities recognize cognitive processes, social learning, and self- efficacy.” (Fred Luthans, p.541)

Modeling
It involves observational learning. Bandura believed that behavior is learnt “through the influence of example.”(Behavioural Approaches to Therapy, 1976, p.5) bandura’s hypothesis is “people can learn from others”. Modeling, according to Bandura, involves attention, retention, motor reproduction and reinforcement.

Self- Efficiency
Bandura defined ‘self- efficacy’ as the belief in one’s capabilities to organize and execute the course of action necessary to produce results. This means people of h ‘high efficacy’ can do better than people of ‘low- efficacy’. Efficacy can be trained and developed.

Motivation
Motivation is derived from the Latin root ‘movere‘ which means ‘to move’. Motivation process starts with a physiological or psychological deficiency or need that activates a behavior aiming at an incentive. Motivation involves need, drive and incentive. Motivational process includes needs, which drive a person to realize incentives.

The motives or drives are classified as primary, general and secondary. Hunger, thirst, sleep and sex are some common primary motives. They are physiological and unlearned. Curiosity, affection and manipulation are some general motives. Secondary motives are the need for power, achievement, affiliation, security, status etc. They are the most important motivating forces in organizational behavior. They are learnt.

Motivation can be seen as extrinsic or intrinsic. Extrinsic motivators are external to the individual viz salary, perks, incentives, allowance and concessions. Intrinsic incentives are internal to the individuals and are self- induced.

Work-Motivation
Approaches:
In order to understand Organizational Behaviour better, motive must be learnt & studied. There are 3 categories of “Work- motivation theories ‘viz: i) Content Theories, ii) Process theories, and iii) Contemporary theories

Work Motivation Theories include

i) Maslow’s Needs- Hierarchy Theory
ii) Herzberg’s two Factor Theory
iii) Alderfer’s ERG Theory
iV) Vroom,s Expectancy Theory
v) Porter – Lawler Model
vi) Equity Theory
vii) Control and Agency Theory

i) Maslow’s Theory: Hierarchy of Needs:
Abraham Maslow in his paper ‘A Theory of Human Motivation’ in the July 1943 Psychological Review arranged the human needs in a hierarchical order. He believed that after getting satisfied of one need, an individual moves up to work towards the next motivator in the upper echelons of his need hierarchy.

SELF- ACTUALIZATION
ESTEEM NEEDS
RECOGNITION
SAFETY NEEDS
PHYSIOLOGICAL NEEDS


ii) Herzberg’s two Factor Theory:
By using the critical incident method (both positive and negative), analyzing the responses for the questions on good and bad performances of 200 professionals in Pittsburgh, Fredrick herzberg developed this two Factors (viz. ‘Hygiene factors’ ‘Motivators’) Theory.

The two factors are:

Hygiene factors   Motivators
• Company policy
• Administration
• Technical Supervision
• Salary
• Interpersonal relations
• Supervisor
• Working conditions
  • Achievement
• Recognition
• Work itself
• Responsibility
• Advancement
(Extrinsic to the Job)   (Intrinsic to the Job)


‘Hygiene factors’ are necessary for the performance. They are extrinsic to the job. They may cause dissatisfaction, hence they are dissatisfiers.

‘Motivators’, if increased add efficiency. These are intrinsic to the job. They are job content factors. Hence they are known as satisfiers.

iii) Alderfer’s ERG Theory:

Clayton Alderfer identified 3 groups of core needs:

NEEDS   NECESSARY
a) Existence needs(E)   For Survival
b) Related needs(R)   For Social Relationship
c) Growth needs(G)   For Personal Development


Differing from Maslow and Herzbrg, Alderfer believed more of a continuum of needs than prioritizing them into a hierarchy. Maslow’s approach was known as ‘satisfaction—progression’, whereas Alderfer’s theory believed in ‘frustration --- regression’.

Fred Luthans brings out a comparison of the 3 theories ‘on content’

Alderfer’s ERG Needs Maslow’s Hierarchy of Needs Herzberg’s Two Factors


Thus content theories of work motivation try to identify what motivates people at work and relate them to their motivated behavior.

Process Theories of Work Motivation
These theories identify the cognitive antecedents that go into motivation and tell us how they relate to one another. The theories by Vroom, Porter and Lawler from this category.

iv) Vroom’s Expectancy theory of motivation:
Victor Vroom floated his expectancy theory as an alternative to content theories. Vroom focused on what leads to effort. His theory lies following formula:

MOTIVATIONAL FORCE = Valence Expectancy

F = < V X E

Formula 1: Motivational Force

‘Valence’ is an individual‘s preference for a particular outcome. When he desires a specific outcome, ‘V’ is positive, whereas when he does not desire an exact outcome, V is negative.

Expectancy ranges from 0 to 1. When an event is certain to happen E is ‘1’. When it does not occur, E is ‘O’.

The message for the manager is that he should attach positive rewards to the job and prescribe an objective criteria to attain them.

Vroom model clarifies the relationship between an individual and his organization goals, but does not relate satisfaction performance.

v) Porter-Lawler Model:
Porter and Lawler defined and extended Vroom’s model so as to include the relationship between satisfaction & performance by bringing in a motivation model. Porter and Lawler claimed that motivation, satisfaction, and performance are all separate variables and relate in ways different from what was traditionally assumed. The performance and satisfaction will be more strongly related when rewards are made a significant contribution to the better understanding of work motivation but enjoys least application of it.

Contemporary Theories of Work Motivation

Equity and procedural justice theories, of late, have gained the attention of the researchers.

vi) Equity theory of Work Motivation:
J. Stacy Adam’s equity theory propounds that a major input into job performance and satisfaction is the degree of equity (or inequity) that people perceive in work places and situations.

Formula 2: Motivation Equity
Both the inputs and outputs of a person and the other are seen through the person’s perceptions which are affected by age, sex, education, social status, position etc. Outcomes are made up of rewards like pay, status promotion and job interest.

The Theory of Procedural Justice:

Equity theory is based on a perception of distributive justice, purely department on an individual’s maturity of cognitive evaluation. ‘Procedural justice’ involves a fairness of the procedure used to make a decision. Procedural justice may give to issues of equality in term of promotion, pay, etc.

vii) Control & Agency theories:
‘Control theory’ is a cognitive phenomenon relating to the degree of control over one’s own life and jobs. Those who have such control are able to tolerate unpleasant events and experience less stress on the job than those who do not such control.

‘Agency theory‘ is a cognitive phenomenon relating to the degree of control over one’s own life and jobs. Those who have such control are able to tolerate unpleasant events and experience less stress on the job than those who do not have such control.

‘Agency theory’ is based on the financial economic concept. An agency relationship involves one or more individuals (principal) engaging another person (agent) to perform a service on their behalf. The basic assumption of the ‘agency theory’ is that interests of principal and agent diverge or be different.

IV. Other Theories Of Work Motivation
i) Attribution Theory: Harold Kelley’s attribution theory is based on cognitive behavior, caused by certain aspects of the pertinent environment . Heider’s attribution theory claimed that both the internal (personal) attributes and the external (environmental) attributes determine the work behavior.

ii) Theory X and Theory Y: Douglas Mc Gregor’s Theory X and Theory Y, published in 1957, claimed that Theory X is autocratic approach to management, coercing and controlling employees, whereas theory Y implies a humanistic & supportive approach to management.

iii) Pygmalion Effect in management: As the reek mythical figure Pygmalion, the sculptor who was able to make one of his status to come to life, an efficient manager can motive even an inefficient employee to develop into a skillful one.

iv) Mc Clelland’s Achievement Motivation Theory: D.C. Mc Clelland and his team from Harvard University in 1960’s claimed that humans get motivated by 4 main arousal – based motives;
a) The achievement motive(n-Ach)
b) The affiliation motive(n-Aff)
c) The power motive(n-Pow)
d) The avoidance motive(n-Avo)

According to Mc Clelland ‘n-Ach’ stands foremost. Hence it is called the ‘Achievement Motivation Theory’. This theory postulates that people with a high ‘n-Ach’ factor show:
a) Constant need for achievement.
b) An eagerness to accept positions of responsibility.
c) A willingness to set a goal for themselves.
d) A quality that achievement is more important than affiliation needs. Mc Clelland claimed that such people will make ideal managers.

V. Edwin Lock’s goal Theory
According to Edwin Locke ‘goal’ itself is the driving force/ motivator. The highlights of this theory are:

i) Aim at a specific target to be more effective.

ii) ‘goal-commitment’ of individual and their perception of ability to realize the goals are important; and

iii) Feedback of performance is a key element to individual motivation in achieving specific goals.

To conclude, managing people (HR) is concerned with maximizing the ROI in its HR. It is achieved through motivating the workforce. In order to motivate them appropriately an HR Manager is supposed to be in knowledge of all these theories of learning on motivation.

Behaviour in Groups

Organizations are seen as group or groups of people working together to realize common objectives. Kossen’s definition of organization corroborates this idea: “An organization is a group of individuals coordinates into different levels of authority and segments of specialization for the purpose of achieving the goals and objectives of the organization.”

There is no clear cut definition for ‘group’. One is single; two is a pair; three and above form a group. In terms of organizational Behaviour, group is a collection of 3 or more people, who know and understand one another, coming together to achieve a common goal.

Groups influence an individual’s behavior and also leave an impact on organizational behavior. Groups can be good for both organization and its members. Effective managers make efficient use of groups to the benefit of their organization.

According to Harold J. Leawitt groups

• Are good for individuals and organizations;
• Can help to be creative and innovative;
• Can make better decisions;
• Can have commitment to realize decisions;
• Can exercise control on the members of their group;
• Can negate the negative effects of the growing size of the organization

Groups can effectively perform their tasks, by capitalizing on group potential, known as ‘synergy’. Synergy refers to the accumulative power of a whole that is greater than the sum of its individual parts. When synergy happens groups are able to achieve more than the total of their members’ individual capabilities. Progressive HR managers try to capitalize on the synergy of the groups as effective human resources of their organizations.

To be antithetical, groups can also cause problem to the organization and their members. Though we claim “Two heads are better than one”, there is also a famous proverb in English “Too many cooks spoil the broth.”

‘Social Loafing ‘or ‘Ringleman Effect’ has to be avoided in group performance. Ringleman, a german psychologist proved the world how grouping could into ‘social loafing’. He asked people to pull a rope individually and then in a group. He showed the world how the average productivity dropped when more people joined to pull the rope. Hence Ringleman postulated a theory on group work culture: groups may not work hard as they would individually because
a) Their contribution is not conspicuous, and
b) They prefer to see others work.

In fact, it is because of reducing this “ Social Loafing ‘ or ‘Ringleman Effect’ an HR manager is expected to study Organizational Behaviour.

Based on their functions, groups can be classified as
1. Friendship groups
2. Task groups/temporary work groups
3. Formal groups/official groups
4. Informal groups
5. Effective groups
6. Interest groups, and
7. Psychological groups

1. Friendship groups evolve informally to cater to the members’ personal security interest, esteem and belonging needs.

2. Task Groups are created for accomplishing certain goals, to solve a specific problem, or to perform a specific task. It is created by the management/ organization. It is disbanded once the goal is achieved. STF, flying Squads at the time of lection are of this nature. They are also known as ‘temporary work groups.’

3. Formal groups are created by formal authorities of the organizations to serve a specific purpose. Every department in an organization is a formal work group. There are many such ‘permanent work—groups’ in every big organization. Some examples for these groups are: Customer- Relations Department, billing section, Products Division and Assembly—Group.

4. Informal groups emerge spontaneously out of day-to-day activities, interactions, etc without any formal endorsement.

5. Effective groups The members of these groups
a) Know why their groups exist;
b) Support the common goals, decisions etc;
c) Communicate well;
d) Help one another;
e) Deal with the conflict well;
f) Have learnt to dissect, analyse, discuss & improve their functioning.

6. Interest groups consist of people who share common interest; it could be job—related or outside job- interest, like sports, music or service to society.

7. Psychological groups: Edgar schein, a social psychological and management consultant identifies the following parameters of the psychological groups:
a) They interact soulfully with each other;
b) They see themselves part of the group;
c) They share a common purpose;
d) They are psychologically well aware of one another.

An ‘effective group’ achieves high level of a) task performance and b) human resource maintenance. High level of task performance includes time efficiency and quality work. Human resource maintenance subsumes job—satisfaction, interpersonal- relations, and co-ordination.

Groups are open systems. Groups in an organization, in general, are inter dependent. Each group has its own goals. Sometimes groups emphasize their own goals and lose sight of the organization’s common goal. Then sub-goal optimization occurs. Efficient managers should try to avoid, deter and steer clear of this sub-goal optimization.

Groups, as open systems, can be effective if the following principle is used; “Better the group inputs, better the chance for group effectiveness’. Organizational setting, nature of the task, member character, group size are some of the group input factors which may influence the group operations & outcomes.

Group Process / group dynamics are the forces operating within the groups. They affect both the task performance and HR maintenance. As we consider ‘group’ as an open system that transforms resource inputs into product outputs, group dynamics are the “processes” through which this transformation is achieved.

George Homan’s classical model of group dynamics postulates the required and the ‘emergent’ behaviors of the members of the groups. As a basis of continued affiliation and support, organization may request formally from the members of the group to be punctual, cordial, helpful and cooperative. These are instances of ‘required behaviour’. ‘Emergent behaviours’ extend from the ‘required behaviours’. It comes out of personal choice or predilection. For example, calling an absent an absent member on his cell to inquire if he will be coming or not, is an instance of emergent behavior.

Stages of Group Development

Any group evolves over a period of time and then gets dissolved. There are five stages of group development;

i) Forming
ii) Storming
iii) Norming
iv) Performing, and
v) Adjourning

Stage   HR Maintenance Norms   TASK Performance
1. Forming   Ice breaking & familiarizing   What is the task & how to do it?
2. Storming   Tension between group members & leaders   Resistance to task & method
3. Norming   Initial integration, harmony development & Establishment of norms   Coordination & Cooperation
4. Performing   Total integration—stable relationship   Continuous improvement in performance & quality work
5. Adjourning   Ceasing of contacts--- disbanding   Task completion


a) TASK Activities in a group:

TASK   ACTIVITIES
Encouraging   Appreciating & adding value to others ideas
Harmonizing   Compromising , mediating & reconciling
Setting Standards   For realization & achievement
Following   Smooth sailing & agreeing to try others’ ideas
Gate keeping   Encouraging equal participation of Group members


Avoiding disruptive Behaviour in groups

Disruptive behaviours harm the group processes. A group member avoids

i) being aggressive; ii) withdrawal & refusal to cooperate; iii) goofing off or fooling about; iv) avowal; v) beating about the bush; vi) doing anything only for recognition.

Decision Making in groups

According to Edgar Sachein, the decision in groups are made by

i) lack of response (by default);
ii) authority rule (one person dominates);
iii) minority rule (sub group dominates);
iv) majority rule (by vote);
v) consensus (mutual agreement ); and
vi) unanimity (everyone wants the same)

Groupthink: Social psychologist Irving Janis identifies this group cohesive process as ‘groupthink ‘.The members of the group avoid being critical or evaluate of members ‘ideas. When they become too much concurrent with a member’s idea, there arises a lack of realistic appraisal. This can be disadvantageous to group’s decision- making process. To deal with this, Janis gives the following advice:

• Invite objections/evaluations by making very member a critical evaluator;
• The leader can avoid being partial;
• Create sub group working under different leaders for the same problem;
• Discuss issues & report;
• Invite ‘outside’ expert to observe 7 comment on group activities;
• Assign one member of the group to act ‘devil’s advocate’ role; and
• Hold second change meetings.

The general formula to bear in mind for effective opinion making process is:

Group Decision effectiveness = individual Contribution + group process gains—group process losses.

Formula 3: effective group decision making process

When groups compete, creativity is more. When properly harnessed and tapped they can be strong assets to an organization.

Leadership


There is a very famous saying in English. “Be a leader, not a boss”. It is easy to be a leader but it is very difficult to be a manager. A leader inspires, innovates, motivates, develops people, She/He is original and a visionary, whereas a manager has to work according to time schedules: he has to extract work; supervise, monitor, control, administer and evaluate. According to Mintzberg, “Leadership is one among the ten roles that managers play.”

Leadership is an act of influencing people to achieve a common goal. According to bennis, ‘Leaders conquer the context, manager’s surrender to it.”

Leadership according to Paul Hersey and Kenneth Blanchard is “the process of influencing the activities of an individual or a group in efforts toward goal achievement in a given situation.”

Leadership Vs Managership

Both are different. All managers are leaders but all leaders are not manages. Management is a special kind of leadership.

Who is a leader?

A true leader
i) develops team spirit.
ii) is a true representative of his subordinates.
iii) is a counselor.
iv) uses power properly.
v) manages time efficiently; and
vi) communicates effectively.

The importance of leadership: By sensing the importance of leadership, Keith Davis opines: “Without leadership, an organization is but a muddle of men and machines”.

There are a host of theories available to navigate us through the idea of leadership. There are 4 different kinds of approaches; viz:

1. Trait approach; 2. Group approach; 3. Contingency approach; 4. Path-goal approach.

These 4 broad divisions can further be divided into 16 different theories:

I. Trait Approach


1. Trait Leadership Theory believes in the leader’s personal attributes. Some attributes are fairness, intelligence, understanding, technical competence and communicative ability. Originally it was believed that leaders are born; but now we have different views.

2. Great Person Theory says leadership traits can be learnt and developed. According to Katz, ‘effective manager requires technical, conceptual and interpersonal skills’.

The most important shortcoming of this theory is that it ignores the wants of the followers and situational demands and factors.

II. Behavioural Approach Theories


Inability to fix common traits for the leaders drove the social scientists to search for the behaviours that specific leaders show.

These theories on behavioural approach propagate that leadership is shaped by effective role behavior of both manager and subordinates. They make an impact on one another. The two important leadership behavior are; i) initiating structure ( task- orientation), and ii) consideration ( rapport). These were rigorously practiced and experimented in 1950s and 1960s.

Group and Exchange theories Of Leadership
These theories implied that the leader gives more rewards than expenses to his follows. They also postulate that there must be a positive exchange between the leaders and followers, as this social exchange is mutually rewarding.

4. Follower’s impact on leader
Research has proved subordinates too affect leaders and their behavior as leaders do affect their subordinates ‘behavior. The study proved that when subordinates were not performing well, the leaders emphasized initiating structure. When they were performing well, the leaders were considerate to them.

5. VDL Approach
Vertical Dyad Linkage (VDL) model or Leader Member Exchange (LMX) approach propounded that leader and members develop dyadic relationship which affect the behavior of both leader and subordinates. Subordinates who are committed are treated as ‘in-group’ by the leaders. Those who do not display this commitment are treated as ‘out-group’. The ‘in-group members’ perception of their leader is positive and they are rated as high performers.

III. Contingency Approach


This approach is turned towards the situational variables of leadership that affect the leadership roles, skills, behaviour and follower’s performance satisfaction.

6. Fred Fiedler’s model
This model propounded a relationship between leadership style and the favorableness of a situation. His model etched situational favorableness in terms of three dimensions; viz:

i) Leader --- member relationship;
ii) Degree of task—structure; and
iii) Leader’s position--- power.

If the 3 dimensions are high, the situation can be said to be favourable. If it is other way round it is seen unfavourable. Favorableness of the situation in combination with the leadership style determines effectiveness. Fiedler also proved that under very favourable and very unfavourable situations ‘go-getting “(authoritarian) style was effective. Democratic style of leadership is effective in the moderate range of favourable/ unfavourablness.

The theory was criticized for its narrow focus on only one trait at a time, ambiguous parameters of terms of the model, and lack of explanatory process.

The theory was criticized for its narrow focus on only one trait one at a time, ambiguous parameters of terms of the model, and lack of explanatory process.

Favourableness of the situation
After enough empirical research, Fiedler proposed Cognitive Resonance Theory which identified the situations under which a leader’s cognitive resource like intelligence, experience & technical expertise correspond with group and organizational performance.

iv. Goal Leadership Theory


Attributed to Martin Evans and Robert House and related to contingency approach, this theory is derived from expectancy theory of motivation. It illustrates the impact of leader behavior on subordinates’ motivation, satisfaction and performance. By making use of 4 different styles of leadership, viz,

i) Directive leadership,
ii) Supportive leadership,
iii) Participation leadership, and
iv) Achievement-oriented leadership, in different situations, effective leader’s clarity the path or means by which subordinates can attain both job satisfaction and high performance. The leader specifies task, reduces road blocks, increases opportunity, motivates and helps subordinates reach goals, by using employee- centered and task-centered leadership styles.
V. Recent Theories of Leadership

7. Characteristic leadership Theories
According to Robert House charismatic leaders possess superior debating and persuasive skills and technical expertise. They exude self- confidence, social sensitivity and empathy. Ethical charismatic leaders transform their organizations to betterment, whereas the unethical charismatic leaders use their charisma for personal gains.

8. Transformational Leadership Theory
According to J.M.Burns, in meeting the challenge of change, the transformational leaders make use of inspiration, charisma, intellectual stimulation, and personal consideration. The traditional, transactional leaders use only contingent reward, active and passive management by exception, and have a laissez faire style.

vi. Social Cognitive Approach


In this approach cognitive processes like symbolizing, forethought and self- efficacy are given due importance. The followers are actively involved in the process, and they concentrate on their and others’ behavior along with their leader’s. In such approach, ‘the leader and the subordinate have a negotiable, reciprocal interactive relationship’, says Fred Luthans.

vii. Substitutes for Leadership


Steven kerr and John M. Jermier found that the characteristics of subordinate, task and organization, substitute for leadership. This means that certain things are beyond leader’s control; leaders do not have magical powers. Situation at times play a part.

viii. Other approaches in Leadership


Paul Hersey & Kenneth Blanchard Theory
The successful leadership style is contingent on the followers’ maturity, ability and willingness. As the employee matures in the ability and willingness to accept responsibility, the leadership style would change on these lines.

i) Telling (Unable & unwilling)
ii) Selling (Unable but willing)
iii) Participating (Able but unwilling); and
iv) Delegating (willing & able).

IX. Post Globalization Studies & Theories


Culture-Based Leadership approach
In the global economy culture takes a centre-stage in getting things done. While examining the styles and successes of managers across cultures, researchers found that the degree of participation used by managers and leaders differed from country to country based on the dependent culture.

Value Based Leadership
There is a mutual impact of leader and followers based on their personal values.

Social status of the Leaders
Educational, class, social and economic backgrounds of managers do really matter much in their leadership styles.

Globe Studies Global Leadership and organizational Behaviour Effective (GLOBE), a project under Robert House identified these dimensions:

i) Power distance
ii) Uncertainty avoidance
iii) Human orientation
iv) Collective actions
v) Belongingness
vi) Assertiveness
vii) Gender egalitarianism
viii) Future orientation
ix) Performance orientation

Leadership Style


i) Distinction between X & Y Leadership Styles

ii) Managerial Grid

Robert Blake and Jane Mountain developed the ‘Managerial Grid’ , a graphic model of alternative combinations of managerial styles on two dimensions – viz, i) Concern for people, ii) Concern for production, shown on vertical and horizontal dimensions of the grid on 1 to 9 scale. This results in 5 combinations – viz:

i) Country – Club style; 1-9: Extreme concern for people;
ii) Task Leadership style: 9-1: extreme concern for productions:
iii) Team Leadership style: 9-9: High concern for production & people
iv) Impoverished leadership style: 1—1: Low concern for production & people
v) Middle of the Road style: 5-5: Concerned to be the best: moderate concern for both production & people.

iii) Situational Approach

Paul Hersey and Kenneth Blanchard gave this to the world. This has already been dealt with. Success of leadership is contingent on follower’s is maturity.

Situational forces that determine the use of leadership & authority

1. Forces in the Manager (his/ her value system, confidence in subordinates, secure/ insecure feelings, skills, orientations, personality, etc.)

2. Forces in the Subordinates (independent/ dependent nature; responsible behavior, tolerance; ability; knowledge ; experience ; participation in decision making ; group size , structure and unity; etc.)

3. Forces in- the situation (type of organization, time--- duress, kind of problem, structure & size of the organization, authority- responsibility relations, groups’ dynamism. Etc).

iv) Rinses Likert’s Management Systems & Leadership

Rinses Likert & his associates from Michigan University, U.S.A., gave this to the world
i) System 1 - Exploitative Authoritative
ii) System 2 - Benevolent - authoritative
iii) System 3 - Consultative
iv) System 4 - Democratic

System 1: Leadership style is highly autocratic (owner-save relationship);
System 2: Through autocratic, at times considerate (master-servant relationship);
System 3: Recognizes the employees & consults them (considerate); and
System 4: Ideal managerial style. (Relationship between manager & employee is cordial).

v) Leadership Continuum

In 1958 Robrt Tannenbaum & Warren Schmidt developed this contingency model. Placing the leadership style on a continuum, they gave a range of styles.

Leadership, Roles, Activities and Skills


Based on the experience, research and studies, the following are identified as the roles, activities and skills need for a leader- manager of an organization:

1. Leader Roles: The three important roles any leader/ manager does in his organization are:

i) Interpersonal Role: Maintaining relationship, meeting people, motivating & encouraging the workers, etc.

ii) Information Role: 85% of a manager’s job is in receiving, distributing, disseminating, providing & channelizing the communication/ information. Information flows in & out of his office.

iii) Decision Making Role: From the input to output, from idea generation till accomplishment of the project, at every point, a leader is supposed to be involved in making or arriving at decisions.

2. Leader’s Activities
i) Communication Activities: Managing the information.
ii) Managerial Activities: Planning, decision making, controlling, monitoring.
iii) PR/HR Networking Activities: Interaction inside & outside the organization.
iv) HRM: Staffing, training, development. Motivation, reinforcement, discipline, punishment, etc.

3. Skill set:
i) Social Skills: ABLE to participate, relate with humans.
ii) Monitoring skills; Setting standards, quality supervision & control.
iii) Entrepreneurship skills: Facing crises, challenge, change, maintaining order, balance equilibrium.

Summary

Organizational behavior is an important study in management as it studies the human element, which is the most important on in any organization.

From a materialistic outlook during 18th century, organizations started looking at the employee as a human during the 19th century, to ultimately focus on his behavior during the 20th century. World War I, Hawthorne studies, the Great depression, Henry Fayol, Elton Mayo and his Harvard colleagues’ research findings, and the continued research till Fred Luthans have enriched the study or Organizational Behaviour culture. Organizational Behaviour studies the goal--- directed activities of the individuals and groups in organizations. Organizational Behaviour is the understanding, prediction and management of human behavior in organizations.

3 approaches to Organizational Behaviour are cognitive, behavioural & social learning school of thought. Combining all these, Fred Luthans created SOBC model.

Organizational Behaviour can be seen as a social system, consisting of various interacting interdependent subsystems. Keith Davis identified i) autocratic, ii) custodial, iii) supportive & iv) collegial models of industrial behavior in Organizational Behaviour.

Organizational Behaviour was preceded by i) Industrial psychology, ii) Scientific management movement, iii) Supportive & iv) collegial models of industrial behavior in Organizational Behaviour.

Organizational Behaviour was preceded by i) Industrial psychology, ii) scientific management movement, iii) Human relations movement. HR movement included the Great Depression, the rise of trade unionism and the Hawthorne experiments, Elton Mayo & Harvard studies.

Learning in Organizational behavior means change in behaviour as a result of a particular experience. Connectionist behavior theories of learning include classical conditioning (stimulus—response) by Pavlov and operant conditioning (response—stimulus) by Skinner. Operant conditioning is applicable in reinforcement schedules of industries. Tolman’s cognitive school believed in stimulus leading to another stimulus, motor reproduction & reinforcement. Training programmes are designed, based on this theory of reinforcement.

Motivation is an urge that causes an individual to move in a goal directed pattern to satisfy a need. P (performance) = F ( Ability X Motivation).

Theories of motivation include Abraham Maslow’s need Hierarchy theory, Herzberg’s two factor theory, Vroom’s expectancy theory, Alderfer’s ERG theory, porter Lawler model, attribution theory, McGregor’s XY concept, Pygmalion Effect, etc.

Organizational Behaviour is dependent on group performance. Groups are good for the organization. The kinds of groups include—friendship group, task group, formal & informal groups, temporary group, permanent group, interest group & psychological groups.

Groups have an evolution and development: forming, storming, norming, performing & behavior have been much researched. Trait theories, behavioural theories, contingency theories and a host of other theories have been propagated. Styles include managerial grid, situational approach, Likert’s 4s management. Recent studies focus on leadership roles such as interpersonal- roles, informational roles and decisions making roles. They also focus on Leader’s activities on communication, management, networking & HRM. They also show the effective leader’s skill set: HR, control, entrepreneurship & fire- fighting skills.
Copyright © 2015 Mbaexamnotes.com         Home | Contact | Projects | Jobs

Review Questions
  • 1. Define Organizational Behaviour in your own words.
  • 2. Trace the historical development of Organizational Behaviour.
  • 3. Discuss the three theoretical frameworks of Organizational Behaviour.
  • 4. Consider the relevance of SOBC model.
  • 5. Write a note on connectionist behaviorist theories.
  • 6. Define motivation.
  • 7. Discuss the content theories of work motivation.
  • 8. Write a note on process theories of motivation.
  • 9. Briefly describe equity theory.
  • 10. Review control & agency theories.
  • 11. Consider some of the recent theories on work motivation.
  • 12. How does learning help in organizational Behaviour?
  • 13. Define ‘group’.
  • 14. What are the various types of group?
  • 15. Write a note on the stages of group development?
  • 16. What is groupthink? How can we avoid it?
  • 17. Explain maintenance and task activities in a group.
  • 18. Define leadership.
  • 19. Write a long note on leadership theories.
  • 20. Mention various leadership styles and explain them.
  • 21. Write a note on leadership role, activities and skills.
Copyright © 2015 Mbaexamnotes.com         Home | Contact | Projects | Jobs

Related Topics
Introduction to Organizational Behaviour Keywords
  • Introduction to Organizational Behaviour Notes

  • Introduction to Organizational Behaviour Study Material

  • Introduction to Organizational Behaviour Subject

  • Introduction to Organizational Behaviour Formula

  • Introduction to Organizational Behaviour Questions

  • Introduction to Organizational Behaviour topics