Chapter 1: What Is an Organization?

An organization is a collection of people who work together and coordinate their actions to achieve a wide variety of goals

What Is Organizational Behavior?

Organizational behavior (OB) is the study of factors that have an impact on how people and groups act, think, feel, and respond to work and organizations, and how organizations respond to their environments

What Is Management?

Management is the process of planning, organizing, leading, and controlling an organization’s human, financial, material, and other resources to increase its effectiveness

Four Functions of Management

Decision Making

• Considerable risks are involved when managers make decisions MOST LIKELY because the decisions are made under uncertain conditions.

Organizing Management

• In organizing, managers establish the rules and reporting relationships that allow people to achieve organizational goals.

Diversity

• Diversity is defined as the differences resulting from age, gender, race, ethnicity, religion, sexual orientation, and socioeconomic background, and capabilities or disabilities. The increasing diversity of the workforce presents three challenges for organizations and their managers: fairness and justice challenge, decision-making and performance challenge, and flexibility challenge.

Challenges to Diversity

• Fairness and Justice Challenge: Jobs in organizations are a scarce resource, and obtaining jobs and being promoted to a higher-level job is a competitive process. Managers are challenged to allocate jobs, promotions, and rewards in a fair and equitable manner.

Challenges to Diversity

• Decision-Making and Performance Challenge: Another important challenge posed by a diverse workforce is how to take advantage of differences in the attitudes and perspectives of people of different ages, genders, or races, in order to improve decision making and raise organizational performance.

Challenges to Diversity

• Flexibility Challenge: A third diversity challenge is to be sensitive to the needs of different kinds of employees and to try to develop flexible employment approaches that increase employee well-being.

Determination of a Leader

• What does it take to lead one of the largest global companies in the snack, food, and beverage company?

• The conscientiousness, determination, self-discipline, sociability, and affectionate behavior of Indrawn Nooyi, CEO of PepsiCo.

The Big Five Model of Personality

 

Conscientiousness

• Personality trait that describes the extent to which an individual is careful, scrupulous, and persevering

A Measure of Conscientiousness

Exhibit 2.7

• How accurately does each statement describe you?

• I am always prepared.

• I leave my belongings around.*

• I pay attention to details.

• I make a mess of things.*

• I get chores done right away.

• I often forget to put things back in their proper place.*

Agreeableness

• Personality trait that captures the distinction between individuals who get along well with other people and those who do not

 

A Measure of Agreeableness

Exhibit 2.7

• How accurately does each statement describe you?

• I am interested in people.

• I am not really interested in others.*

• I sympathize with others’ feelings.

• I insult people.*

• I have a soft heart.

• I am not interested in other people’s problems.*

• A low level of agreeableness would MOST LIKELY be an asset for a drill sergeant.

Openness to Experience

• Personality trait that captures the extent to which an individual is

– original,

– open to a wide variety of stimuli,

– has broad interests, and is

– willing to take risks as opposed to being narrow-minded and cautious

• Being open to experience will most likely provide an advantage to an individual performing a job that requires innovation.

A Measure of Openness to Experience

Exhibit 2.7

• How accurately does each statement describe you?

• I have a rich vocabulary.

• I have difficulty understanding abstract ideas.*

• I have a vivid imagination.

• I am not interested in abstract ideas.*

• I have excellent ideas.

• I do not have a good imagination.*

Code of Ethics

A code of ethics is a set of formal rules and standards, based on ethical values and beliefs about what is right and wrong, that employees can use to make appropriate decisions when the interests of other individuals or groups are at stake

– Whistleblowers

Work Attitudes

Work attitudes are collections of feelings, beliefs, and thoughts about how to behave that people currently hold about their jobs and organizations.

Mood greatly influences employees in the workplace.

The Sarbanes-Oxley Act

• The Sarbanes-Oxley Act of 2002 has dramatically increased the reporting and accountability obligations of public companies and requires independence on the part of a company’s audit committees. Moreover, the act requires that an organization must enact a code of ethics and mandates strict adherence to it. The act also requires that organizations have ethics programs in place.

Workplace incivility

• Workplace incivility is rude interpersonal behavior that reflects a lack of respect for others.

• Beautifying the office is the best way a manager can combat a high amount of workplace incivility in the office.

Perception

Perception is the process by which individuals select, organize, and interpret the input from their senses to give meaning and order to the world around them People try to make sense of their environment and the objects, events, and other people in it

Characteristics of the Perceiver That Affect Perception

• Exhibit 4-2

Factors That Influence Perception

Schemas

Schemas are abstract knowledge structures that are stored in memory and allow people to organize and interpret information about a given target of perception

• Based on past experiences and knowledge

• Resistant to change

The Functionality of Schemas

• Functional

– Help to make sense of sensory input, choose what information to pay attention to and what to ignore, and guide perceptions of ambiguous information

• Dysfunctional

– People tend to notice information that is inconsistent with their schemas

– Can result in inaccurate perceptions

Positive Reinforcement

• Increases the probability that a behavior will occur by administering positive consequences to employees who perform the behavior

– Pay

– Bonuses

– Promotions

– Job titles

– Verbal praise

– Awards

Negative Reinforcement vs. Punishment

• Punishment reduces the probability of an undesired behavior

• Negative reinforcement increases the probability of a desired behavior

• Punishment involves administering a negative consequence when an undesired behavior occurs

• Negative reinforcement entails removing a negative consequence when a desired behavior occurs

Operant Conditioning

Operant conditioning describes how learning takes place when the learner recognizes the connection between a behavior and its consequences. Operant conditioning is based on individuals’ learning to engage in specific behaviors in order to receive certain consequences. The learning occurs when the learner recognizes the relationship between a behavior and its consequence.

Social learning theory

• Social learning theory is based on the idea that thoughts and feelings influence learning. Social learning theory stresses the importance of cognitive processes and suggests that learning can occur vicariously, that workers can engage in self-control to learn and manage their own behavior, and that individuals’ beliefs about whether they can perform a desired behavior (self-efficacy) is important.

Operant Conditioning vs. Social Learning Theory

• Social learning theory takes into account the role of the learner’s thoughts and feelings. In contrast, the theory of operant conditioning asserts that people simply respond to the giving or removing of consequences for desired and undesired behaviors, with no recognition of thoughts or feelings.

Operant Conditioning

 

Negative Consequences of Operant Conditioning

• By trying to encourage safety by offering bonuses to departments that go 90 days without an on-the-job accidents being reported, a company may unintentionally reinforce employees not to report on-the-job accidents.

The Motivation Equation

Need Theory

• What outcomes is an individual motivated to obtain from a job and an organization?

• Employees have needs that they are motivated to satisfy in the workplace

• According to need theory, a manager first must determine the needs an employee is trying to satisfy on the job in order to determine what will motivate an employee the most.

Universal Needs

• Physiological and Safety are the most basic needs according to the hierarchy of needs.

What Is Job Design?

• Linking specific tasks to specific jobs

• Deciding what techniques, equipment, and procedures should be used to perform those tasks

• Job design may increase motivation and encourage good performance

Job Design: Early Approaches

• Scientific management

• Job enlargement

• Job enrichment

Job Enrichment

• Designing jobs to provide opportunities for employee growth by giving employees more responsibility and control over their work

• Also known as Vertical job loading

• Based on Herzberg’s motivator-hygiene theory

Advantages of Job Enrichment

• Job enrichment is aimed at increasing intrinsic motivation so that employees enjoy their jobs more. When employees are given more responsibility, they are more likely to feel competent and that they have control over their own work behaviors. Job enrichment can also lead to efficiency gains.

Disadvantages of Job Enrichment

• Not all employees, however, want the additional responsibility that job enrichment brings, and it can sometimes have disadvantages for the organization as a whole. Enriching some jobs can be expensive for an organization and may be impossible to do. Enriching other jobs may result in less efficiency.

Job Enrichment

• Research evidence on the effects of job enrichment has been mixed. Although employees seem to be more satisfied with enriched jobs, it is not clear whether employees with enriched jobs are actually more motivated and perform at a higher level.

Performance Appraisal

• Encourage high levels of employee motivation and performance

• Provide accurate information to be used in managerial decision making

Performance Appraisal

• Performance appraisals allow managers to

• help a worker formulate appropriate career goals

• evaluate whom to promote

• determine who should receive a pay increase

Formal Performance Appraisal

• In a formal performance appraisal , the performance dimensions and the way employees are evaluated on them are determined in advance.

Evaluative Performance Appraisal

• Evaluative performance appraisals are valuable in:

– deciding whom to promote

– deciding how to set pay levels

– deciding how tasks should be assigned

Evaluative Performance Appraisal

• when developing an effective performance appraisal managers need to decide:

– what to evaluate

– whether to use formal or informal appraisals

– which methods of appraisal to use

What Is Stress?

• Stress is the experience of opportunities or threats that people perceive as important and also perceive they might not be able to handle or deal with effectively.

• It is only appropriate to define something as a stress if it could harm a person

Key Aspects of Stress

• Stress can originate from opportunities and threats

• The opportunities or threats that cause stress are important to the person in question

• The person who is experiencing the threat or opportunity is uncertain as to whether he or she can effectively handle the situation

• Stress is rooted in perception

Key Aspects of Stress

• 26) The major factors of stress that affect everyone are:

• Threat

• Opportunity

• Importance,

• Uncertainty

Coping with Stress (Problem focused)

• Problem-focused coping involves all of the measures taken to deal with and act on the source of stress. Individual problem-focused strategies include
(1) using time management techniques to help his/her make better use of time;
(2) getting help from a mentor who can provide advice and guidance; and
(3) employing role negotiation, the process of actively trying to change roles in order to reduce levels of role conflict, role ambiguity, overload, or underload.

Coping with Stress (Emotion focused)

• Emotion-focused coping involves all of the measures taken to deal with and control stressful feelings and emotions. Individual emotion-coping strategies include
(1) exercise to increase cardiovascular strength and reduce stress levels;
(2) meditation, a mental process;
(3) social support, a system of friends, coworkers, and relatives who care about the worker, give advice, and are available to talk to; and clinical counseling, professional psychological and psychiatric advice to help cope with stress.

Violence in the workplace

• If an organization wanted to minimize the danger of workplace violence it should:

– ensure that employees are aware of the workplace violence policy

– provide employees with cell phones

– install security systems in the workplace

When Is a Group a Group?

 

Types of Work Groups

 

Informal Work Groups emerge naturally in organizations because members believe that working together in a group will help them achieve their goals or meet their needs.

Performance, Process Losses, and Gains

 

Problems in Group Motivation and Performance

 

Causes of Social Loafing

• The potential for social loafing exists when individuals work in groups in which their individual performances are not readily observable.

• Tendency for individuals to exert less effort when they work in groups as opposed to when they work by themselves

• Perception that individual efforts are unnecessary or unimportant

The Five Stages of Tuckman’s Model of Group Development

• Forming: Group members try to get to know each other and establish a common understanding.

• Storming: Groups are in conflict, members resist being controlled by the group, and disagreements arise concerning leadership in the group.

• Norming: Group members develop close ties, feelings of friendship abound, and group members share a common purpose.

• Performing: Group members work toward achieving their goals.

• Adjourning: The group disbands once its goals have been achieved.

What Is Leadership?

Leadership is the exercise of influence by one member of a group or organization over other members to help the group or organization achieve its goals

Leadership

• Leaders are individuals who exert influence to help meet group goals

– Formal

– Informal

• Leader effectiveness is the extent to which a leader actually does help

The Leader Behavior Approach

Consideration

• Consideration involves behaviors indicating that a leader trusts, respects, and values good relationships with his or her followers.

Initiating structure

• Initiating structure involves behaviors that a leader engages in to make sure the work gets done and subordinates perform their jobs acceptably.

– setting goals

– planning ahead

– assigning individual tasks

Leader-member Exchange Theory

• Leader-member exchange theory describes the different kinds of relationships that may develop between a leader and a follower, and describes what the leader and the follower bring to and get back from the relationship. The theory focuses on the leader-follower dyad. Each dyad develops a unique relationship that stems from the unfolding interactions between the leader and the follower.

Leader-follower Dyad

• In some dyads, the leader develops a special relationship with the subordinate, characterized by mutual trust, commitment, and involvement. The subordinate helps the leader, the leader helps the subordinate, and each has substantial influence over the other. The leader spends a lot of time with the subordinate, who is given freedom to use his or her own judgment on the job. The subordinate tends to be satisfied and to perform at a high level. This relationship is defined as the in-group.

Leader-follower Dyad

• In a more traditional relationship, the leader relies on his or her formal authority and position in the organization to influence the subordinate, and the subordinate is expected to perform his or her job in an acceptable manner and to follow rules and the directives of the leader. The subordinate has considerably less influence over the leader, and the leader gives the subordinate less freedom to use his or her own judgment.

Leader-follower Dyad

• These dyads are characterized by an impersonal, distant, or cold relationship between the leader and the subordinate. This defines the out-group. They are less satisfied and perform at a lower level than in-group subordinates.

The Nature of Power and Politics

• Power

• Principal means of directing and controlling organizational goals and activities

• Ability to get others to do something they might not otherwise do

Power

• a division or function becomes powerful when the tasks that it performs give it the ability to

– control the behavior of other divisions or functions

– make other divisions or functions depend on it

– increase its share of organizational resources

What Is Communication?

• Sharing of information with other people

• Reaching of a common understanding

• Accuracy, not agreement

Four Functions of Communication

• Providing knowledge

• Motivating organizational members

• Controlling and coordinating individual efforts

• Expressing feelings and emotions.

Providing knowledge

• Providing knowledge is important for helping organizational members understand the performance requirements of a job, the decisions made on organizational issues, the socialization process for new organizational members, and the changes made to jobs.

Motivating organizational members

• Motivating organizational members is important for an organization to achieve its goals. Managers need to understand the outcomes that their employees desire and how the employees are doing on meeting goals. Employees need to understand what the manager believes they are capable of doing and what the organizational goals are.

Controlling and coordinating individual efforts

• Controlling and coordinating individual efforts is important to ensure workers perform their jobs in an acceptable manner. Groups and organizations regularly communicate information to workers about roles, rules, and norms. Communication also helps identify inadequately performing organizational members and avoids duplication of efforts.

Expressing feelings and emotions

• Expressing feelings and emotions is important for helping organizational members understand each other and be better able to work together to achieve organizational goals.

Chain Network

• A Chain Network is characterized by communication between members flowing in a predetermined sequence, and is most common when tasks are sequentially interdependent.

Circle Network

• In a circle network, members communicate with those who are similar to them on some dimension, such as expertise, interests, or location.

• The circle network occurs in groups whose members communicate with others who are similar to them on some dimension ranging from experience, interests, or area of expertise to the location of their offices or even who they sit next to when the group meets.

All-Channel Network

• In an all-channel network, every group member communicates with every other group member.

• An all-channel is MOST OFTEN used in groups whose task involves reciprocal task interdependence.

Decision Making

Decision making is the process by which members of an organization choose a specific course of action to respond to the opportunities and problems that confront them Opportunities Problems

Heuristics and Resulting Biases

Heuristics

• Heuristics are the rules of thumb that help people simplify decision making.

• Heuristics can lead to biases, or systematic errors in decision making.

• The availability heuristic reflects the tendency to determine the frequency of an event and its causes by how easy these events and causes are to remember.

Designing Organizational Structure

• Organizational structure the formal system of task and job reporting relationships that determine how employees use resources to achieve the organization’s goals.

• Organizational design is the process of making the specific choices about how to arrange the tasks and job relationships that comprise the organizational structure.

Organization change

• Organization change is the movement of an organization away from its present state and toward some desired future state to increase its effectiveness. The most important forces for change are as follows: competitive, economic and political, global, ethical, and demographic and social.

Allocation of Authority

• Authority is the power vested in a manager to make decisions and use resources to achieve organizational goals by virtue of his or her position in an organization.

– Span of control

– Tall and flat hierarchies

– Chain of command

– Centralization versus decentralization

Authority

• The hierarchy of authority is an organization’s chain of command, extending from the CEO down through the middle managers and first- line managers, to the nonmanagerial employees who actually make the goods or provide the services.

• The span of control refers to the number of subordinates who report directly to a manager.

A Wide Span of Control

A Narrow Span of Control

Organizational Culture

• Organizational culture is a set of shared values, beliefs, and norms that influence the way employees think, feel, and behave toward one another and toward people outside the organization.

Value sets

• Value sets for a successful organization with a strong culture include:

– Its values promote a bias for action.

– Its values stem from the nature of its organizational mission.

– Its organizational design motivates employees to do their best.

Corporate Culture

• Companies with strong, adaptive corporate cultures tend to have:

– bias for action

– adherence to organizational mission

– commitment to making work motivating

Terminal and Instrumental Values Instrumental

Hofstede’s Model of National Culture

• Individualism

– freedom

– achievement

– competition

• Collectivism

– cooperation

• Power Distance

• Achievement vs. Nurturing Orientation

• Uncertainty Avoidance

•  Long-term vs. Short-term Orientation

Power Distance

Culture

• In a country with low power distance, the government would MOST LIKELY view programs to equalize wealth amongst all citizens in a positive manner.

• In countries where collectivism prevails, the value of developing individual wealth is very weak.

Organizational Change

• Organizational change is the movement of an organization away from its present state and toward some desired future state to increase its effectiveness

– Reengineering

– TQM

– Innovation

– Restructuring

Innovation

• Innovation is the successful use of skills and resources to create new technologies or goods and services that respond to customer needs.

Lewin’s Force-Field Theory of Change

• Forces resist change

• Forces push change

• Performance levels

– P1 = Balance

– P2 = Increase forces for change, reduce forces for change, or both

Lewin’s Force-Field Theory of Change

• According to Kurt Lewin’s force-field theory, there are the three steps of organizational change.

– Unfreeze

– Change

– refreeze

Lewin’s Force-Field Theory of Change

• Refreezing:

– According to Lewin’s model, refreezing the organization in the new desired state is required so that its members do not revert to previous work attitudes and role behaviors.

Action research

• Action research is a strategy for generating and acquiring knowledge that managers can use to define an organization’s desired future state and to plan a change program enabling it to reach that state.

Categories of Change

• Evolutionary change is change that is gradual, incremental, and narrowly focused

• Revolutionary change is change that is rapid, dramatic, and broadly focused.

– A product champion is an expert manager appointed to head a new product team and see a new product from its inception to sale.