Organisational Behaviour – Unit 1

Complete Detailed Notes

Meaning of Organisation
An organisation is a structured group of people who work together in a coordinated manner
to achieve common goals.

According to Stephen P. Robbins and Timothy A. Judge, an organisation is a consciously

coordinated social unit composed of two or more people that functions continuously to
achieve a common goal or set of goals.

Organisations exist in every field such as businesses, schools, hospitals, banks and
government institutions. In an organisation different individuals perform different tasks but
work together to achieve a common objective.

Characteristics of Organisation
1. Deliberate Creation – Organisations are created intentionally to achieve certain goals.

2. Two or More People – An organisation requires at least two people working together.

3. Common Goals – Members work together to achieve shared objectives.

4. Coordination – Activities of employees are coordinated for efficiency.

5. Hierarchy of Authority – Every organisation has a chain of command from top

management to lower levels.

6. Continuous Existence – Organisations operate continuously over time.

7. Division of Work – Work is divided among employees according to their skills.

Meaning of Behaviour
Behaviour refers to the actions or reactions of individuals in response to situations or
stimuli.

Human behaviour is influenced by both personal characteristics and environmental factors.

The relationship is often expressed as:

B = f (P × E)

Where B = Behaviour, P = Person and E = Environment.

Person factors include education, skills, personality, age and experience. Environmental
factors include working conditions, leadership style, motivation and organizational culture.

Meaning of Organisational Behaviour

Organisational Behaviour (OB) is the study of how individuals and groups behave within
organisations.

It examines the interaction between people, structure and environment in the workplace.
OB helps managers understand employee behaviour and improve organisational
effectiveness.

It studies behaviour at three levels:

• Individual level
• Group level
• Organizational level

Definitions of Organisational Behaviour

Stephen P. Robbins defined organisational behaviour as a field of study that investigates the
impact individuals, groups and structure have on behaviour within organisations.

Fred Luthans defined organisational behaviour as the understanding, prediction and

management of human behaviour in organisations.

Goals of Organisational Behaviour

1. Description – Observing and describing how employees behave in different situations.

2. Understanding – Identifying the reasons behind employee behaviour.

3. Prediction – Predicting future behaviour of employees.

4. Control – Influencing and directing behaviour to achieve organisational objectives.

Nature of Organisational Behaviour

• Behavioural Approach – Focuses on understanding human behaviour in organisations.

• Humanistic Approach – Considers employees as valuable human beings.

• Interdisciplinary – Combines knowledge from psychology, sociology, anthropology and

economics.

• Applied Science – Uses theories to solve real workplace problems.

• System Approach – Views the organisation as an integrated system.

• Goal Oriented – Focuses on achieving organisational objectives.

Limitations of Organisational Behaviour

1. Lack of Unified Theory – Human behaviour is complex and cannot be explained by one
theory.

2. Behavioural Bias – Managers may focus too much on behaviour rather than performance.

3. Law of Diminishing Returns – Excessive focus on behavioural techniques may reduce

effectiveness.

4. Ethical Issues – Behavioural knowledge may be misused to manipulate employees.

Basic OB Model
The OB model explains behaviour through three components:

Inputs – Individual characteristics, group structure and organisational culture.

Processes – Motivation, communication, leadership, decision making and conflict

management.

Outcomes – Employee performance, job satisfaction, teamwork, productivity and

organisational survival.

Organisational Structure
Organisational structure defines how job tasks are formally divided, grouped and
coordinated.

Elements include:

Work Specialization – Division of work into smaller tasks.

Departmentalisation – Grouping similar activities into departments.

Chain of Command – Authority relationship between superior and subordinate.

Span of Control – Number of employees managed by a supervisor.

Centralisation – Decision making concentrated at top management.

Decentralisation – Decision making shared with lower level managers.

Formalisation – Degree to which rules and procedures guide employee behaviour.

Role of Organisational Behaviour
Understanding Human Behaviour – Helps managers understand employee actions and
motivations.

Controlling Behaviour – Behaviour can be influenced through leadership, communication

and motivation.

Organisational Adaptation – Helps organisations adapt to changes in technology,

environment and competition.

Factors Causing Individual Differences

Individual differences occur due to two major factors.

Individual Variables:
• Physiological factors such as intelligence, age, gender and physical ability.
• Socio-psychological factors such as personality, perception, attitude, motivation and
emotional intelligence.

Situational Variables:
• Organisational factors such as culture, leadership and structure.
• Job factors such as nature of work and working conditions.

Models of Organisational Behaviour

Autocratic Model – Based on authority and power. Employees follow orders from managers.

Custodial Model – Based on economic benefits and job security.

Supportive Model – Based on leadership and motivation.

Collegial Model – Based on teamwork and partnership.

System Model – Focuses on trust, participation and organisational culture.

Personality
Personality refers to the unique pattern of thinking, feeling and behaviour of an individual.

The word personality comes from the Latin word “persona”, meaning mask.

Personality helps explain why individuals behave differently in similar situations.

Understanding personality helps managers improve teamwork, job placement and
communication.
Determinants of Personality
Biological Factors – heredity, brain and physical features.

Family and Social Factors – family environment, social groups and upbringing.

Cultural Factors – traditions, customs and social values.

Situational Factors – circumstances and experiences that influence behaviour.

MBTI Personality Indicator

The Myers-Briggs Type Indicator is a personality test based on four dimensions:

Extraversion vs Introversion
Sensing vs Intuition
Thinking vs Feeling
Judging vs Perceiving

It helps understand personality differences and improve teamwork.

Big Five Personality Model

Five major personality traits:

Conscientiousness – responsibility and discipline.

Emotional Stability – ability to remain calm under stress.

Extraversion – sociability and energy.

Openness to Experience – creativity and curiosity.

Agreeableness – friendliness and cooperation.

Values
Values are strong beliefs that guide behaviour and decision making. They determine what
individuals consider important and desirable.

Values influence attitudes, motivation and organisational culture.

Types of Values
Terminal Values – long-term life goals such as success and happiness.

Instrumental Values – preferred ways of behaving such as honesty and responsibility.

Generational Values – values influenced by generation.

Cultural Values – values shaped by society and traditions.

Perception
Perception is the process by which individuals interpret sensory information and give
meaning to their environment.

People often behave according to their perception rather than reality.

Perceptual Process
Stimulus – information received from environment.

Selection – choosing which information to notice.

Organization – arranging information into meaningful patterns.

Interpretation – giving meaning to the information.

Perceptual Errors
Selective Perception – focusing on certain information.

Halo Effect – judging someone based on one positive trait.

Horn Effect – judging someone negatively due to one trait.

Contrast Effect – comparing people with others.

Stereotyping – judging based on group characteristics.

Attitude
Attitude is a learned tendency to respond positively or negatively towards people, objects
or situations.

Components of Attitude:
Cognitive – beliefs
Affective – feelings
Behavioural – actions

Learning
Learning is a relatively permanent change in behaviour resulting from experience.

It helps individuals acquire knowledge, skills and new behaviour patterns.

Learning Theories
Classical Conditioning – learning through association.

Operant Conditioning – learning through rewards and punishment.

Social Learning – learning by observing others.

Cognitive Learning – learning through thinking and understanding.

History of Organisational Behaviour

Adam Smith introduced division of labour in 1776.

Classical Management Era included theories by Frederick Taylor, Henry Fayol and Max
Weber.

Human Relations Movement led by Elton Mayo emphasized employee satisfaction and
social relationships.

Later theorists such as Maslow, McGregor and Herzberg focused on motivation and
employee performance.