ORGANISATIONAL BEHAVIOUR

Complete Study Notes

Simple & Easy Language | All Topics Covered

Unit 1 Organisation & OB Basics

Unit 2 Individual Behaviour – Personality, Perception, Attitude, Values, Learning
Unit 3 Motivation – Theories & Application
Unit 4 Leadership – Theories & Styles
Unit 5 Group Dynamics, Team Building, Conflict & Negotiation
Unit 6 Organisational Structure, Culture & Change
Unit 7 Organisation Development (OD)
Unit 8 Organisational Citizenship Behaviour (OCB)
UNIT 1: ORGANISATION & ORGANISATIONAL BEHAVIOUR
1.1 What is an Organisation?
An organisation is a group of people who work together to achieve a common goal. The word comes from
'Organism' — meaning a body with connected, interdependent parts. When people work together,
questions arise like: Who makes decisions? Who does what work? These questions are answered by the
organisation's structure.

Definition: "An identified group of people contributing their efforts towards the attainment of goals."

Features of Organisation
• Identifiable group of human beings
• Deliberately and consciously created
• Created for a specific purpose (purposive)
• Activities are coordinated
• Has a structure
• Based on rationality

1.2 Organisational Behaviour (OB)

OB studies how people behave in organisations. It covers individuals, groups, and structures — and
how they all affect organisational performance.

Robbins: "OB investigates the impact of individuals, groups and structures on behaviour within
organisations, for the purpose of applying such knowledge toward improving an organisation's
effectiveness."

Nature/Characteristics of OB
• Separate field of study (not a traditional discipline)
• Interdisciplinary — draws from psychology, sociology, anthropology
• Humanistic and optimistic approach
• Goal-oriented
• Both a science and an art
• Studies cause-and-effect relationships
• Three levels of analysis: Individual, Group, Organisation

Importance of OB
• Helps understand ourselves and others
• Improves interpersonal relations
• Helps managers motivate employees
• Predicts human behaviour
• Manages human problems effectively
• Aids in decision-making

Contributing Disciplines to OB
 Discipline Contribution to OB
Psychology Individual behaviour, motivation, personality, learning, attitude
Sociology Group dynamics, team behaviour, organisational culture
Anthropology Culture, values, cross-cultural behaviour
Political Science Power, politics, conflict
Economics Decision-making, resource allocation
History Evolution of management practices

Models of OB
• Autocratic Model: Manager gives orders, employees obey. Based on authority and power. Employees
are dependent on the boss.
• Custodial Model: Organisation provides economic security (salary, benefits). Employees are
dependent on the organisation.
• Supportive Model: Manager leads and supports employees. Based on leadership, not authority.
Employees are performance-oriented.
• Collegial Model: Extension of supportive model. Managers and employees are partners. Based on
teamwork and mutual trust.

Evolution of OB
• Industrial Revolution – mass production, factory systems
• Scientific Management (Taylor) – efficiency, time-motion studies
• Human Relations Movement – focus on people, not just tasks
• Hawthorne Studies – showed that social factors affect productivity

Approaches to Study OB
• Human Resource Approach: People are the central resource; manager supports employees
• Contingency Approach: No single best way; approach depends on the situation
• Productivity Approach: Focuses on output/input ratio to improve performance
• System Approach: Organisation is an interrelated system; looks at the whole picture
• Interactionalism: Behaviour = Person's characteristics × Situation
UNIT 2: INDIVIDUAL BEHAVIOUR – PERSONALITY,
PERCEPTION, ATTITUDE, VALUES & LEARNING
2.1 Individual Behaviour
Every person in an organisation behaves differently based on their personal and environmental
characteristics. Individual behaviour has three main causes:

• Personal Factors: Age, gender, education, abilities, personality, perception, attitude, values, learning
• Organisational Factors: Physical facilities, structure, leadership style, reward system
• Environmental Factors: Economic conditions, political situations, cultural values

2.2 Personality
Definition (Robbins): "The sum total of ways in which an individual reacts and interacts with others."

Personality is a relatively stable pattern of behaviour that makes each person unique. It is both inherited
and shaped by environment.

Big Five Personality Traits

• Extroversion: Comfort with relationships. Extroverts are sociable, assertive, talkative. Introverts are
quiet and reserved.
• Emotional Stability: Ability to handle stress. High stability = calm, confident. Low stability = nervous,
anxious, insecure.
• Agreeableness: Ability to get along with others. High = cooperative, trusting. Low = uncooperative,
self-centred.
• Conscientiousness: Reliability and focus. High = organised, responsible, disciplined. Low = careless,
disorganised.
• Openness: Creativity and curiosity. High = innovative, open to new ideas. Low = rigid, resistant to
change.

Other Important Personality Traits

• Locus of Control – Internal (I control my fate) vs External (fate controls me)
• Machiavellianism – Using any means to get what you want
• Self-Esteem – How much you value yourself
• Self-Monitoring – Adjusting behaviour to fit the situation
• Risk Taking – Willingness to take chances
• Type A Personality – Competitive, impatient, always in a hurry
• Type B Personality – Relaxed, less competitive, patient

Determinants of Personality
• Heredity – genes, biological factors
• Environment – family, school, friends
• Culture – social norms and values
• Situational factors – different situations bring out different traits

Theories/Models of Personality
 • 1. Type Theory: Classifies people into identifiable body-type categories (Kretschmer, Sheldon). Also
Carl Jung's classification into introvert/extrovert.
• 2. Trait Theory: Personality is a set of enduring traits. Allport found 17,953 traits; Cattell reduced to
171; Big Five is the modern approach.
• 3. Psychoanalytical Theory (Freud): Behaviour is driven by unconscious forces. Three elements:
– Id – primitive instincts and desires (pleasure principle)
– Ego – rational, conscious self (reality principle)
– Super Ego – moral conscience, values from society
• 4. Social Learning Theory: Personality is learned through reinforcement and observing others.
Situation determines behaviour.
• 5. Self Theory (Carl Rogers): Focuses on subjective experience and self-concept. Includes
Self-Image, Ideal-Self, Looking Glass-Self, Real-Self.

How Personality Develops (Freud's 4 Stages)

• Oral Stage
• Anal Stage
• Phallic Stage
• Genital Stage

2.3 Perception
Definition: Perception is the process by which individuals organise and interpret sensory information to
give meaning to their environment. It is more than just sensation — it involves filtering, modifying, and
making sense of data.

Perceptual Process (5 Steps)

• 1. Receiving Stimuli – senses pick up information from environment
• 2. Selection of Stimuli – we don't notice everything; we filter using Figure-Ground principle & Relevancy
• 3. Organisation of Stimuli – grouping (Gestalt), closure (filling gaps), simplification
• 4. Interpretation – giving meaning using Halo Effect, Attribution, Stereotyping, Personality, Situation
• 5. Action – behaviour based on perception

Factors Affecting Perception

• Internal: Needs/desires, personality, past experience
• External: Size of stimulus, intensity, frequency, contrast, status, movement

Perceptual Errors/Distortions
• Halo Effect: Judging a person on one trait and applying it to all other traits
• Stereotyping: Judging based on group membership (gender, race, etc.)
• Attribution Error: Misinterpreting reasons for someone's behaviour
• Selective Perception: Seeing only what we want to see
• Projection: Attributing our own traits to others

2.4 Attitude
Definition: "A persistent tendency to feel and behave in a particular way towards some objects, persons
or events."

Attitudes are learned predispositions — they affect how we think, feel, and act.

Components of Attitude (ABC Model)

• A – Affective: Feelings/emotions about something ("I feel anxious about presentations")
• B – Behavioural: Tendency to act in a certain way ("I avoid presentations")
• C – Cognitive: Beliefs/thoughts about something ("Presentations are difficult")

Types of Attitudes (Job-Related)

• Job Satisfaction: How content an employee is with their job
• Job Involvement: How much a person identifies with their job
• Organisational Commitment: How attached an employee is to the organisation

Functions of Attitude
• Adjustment Function: Helps us adapt to the environment (like/dislike what helps/hurts us)
• Ego-Defence Function: Protects self-image from uncomfortable truths
• Expressive Function: Lets us express our values and beliefs
• Knowledge Function: Helps organise and make sense of the world

Formation of Attitude
Attitudes are formed through: Direct experience, Classical/Operant Conditioning, Social Learning, Family
and peers, Culture, Mass communication, Role models.

2.5 Values
Definition: A value is an internalised standard/criterion that guides an individual's evaluations and
behaviour. Values are relatively stable and affect both attitude and behaviour.

Types of Values (Rokeach)

• Terminal Values: Desirable end-goals in life (e.g., World Peace, Happiness, Freedom, Wisdom,
Equality)
• Instrumental Values: Ways/means to achieve terminal values (e.g., Honesty, Courage, Ambition,
Responsibility)

Allport's Six Types of Values

• Theoretical: Pursuit of truth through rational thinking
• Economic: Practicality and usefulness
• Aesthetic: Form, beauty, and harmony
• Social: Love and concern for people
• Political: Power and influence
• Religious: Unity and cosmic meaning

2.6 Learning
Definition: "A relatively permanent change in behaviour that occurs as a result of experience."
Learning is NOT just about schooling — it happens throughout life through experience, practice, and
observation.

Theories of Learning
• 1. Classical Conditioning (Ivan Pavlov): A neutral stimulus becomes associated with a response
through repeated pairing. Example: Pavlov's dog salivating at a bell. Key terms: Unconditioned
Stimulus (US), Conditioned Stimulus (CS), Unconditioned Response (UR), Conditioned Response
(CR).
• 2. Operant Conditioning (B.F. Skinner): Behaviour is shaped by its consequences. Pleasant
consequences = repeat behaviour. Unpleasant consequences = avoid behaviour. Also called
instrumental conditioning.
• 3. Cognitive Learning Theory: People are active, conscious learners. They draw on past experiences,
make choices, recognise consequences, and update their knowledge. Based on understanding, not
just stimulus-response.
• 4. Social Learning Theory (Bandura): People learn by observing others (vicarious learning). Steps:
Attention → Retention → Practice → Motivation. Models include parents, teachers, peers, superiors.

Classical vs Operant Conditioning

Classical Conditioning Operant Conditioning
Reactive – response is elicited Proactive – response is emitted voluntarily
Response is fixed to stimulus Response is variable (person has choice)
Stimulus = sound, object, person Stimulus = situation, social setting
Reinforcement not by choice Person earns reinforcement by their action

Principles of Learning
• Motivation – learner must want to learn
• Reinforcement – reward desired behaviour
• Punishment – discourages undesired behaviour
• Extinction – removing reinforcement reduces behaviour
UNIT 3: MOTIVATION
Definition: Motivation is the willingness to expand energy to achieve a goal. The word comes from the
Latin 'Movere' — meaning to move. It is the inner force that drives people to act.

3.1 Nature of Motivation

• It is an inner feeling that energises action
• Based on unsatisfied needs
• Dynamic and continuous process
• Goal-directed behaviour
• Both positive (reward) and negative (punishment) motivation exist

3.2 Importance of Motivation

• Leads to high performance
• Improves quality of work
• Reduces absenteeism and turnover
• Better organisational image
• Promotes goal-directed behaviour
• Ensures organisational stability

3.3 Content Theories of Motivation

■ Content theories explain WHAT motivates people — the needs inside a person.

1. Maslow's Need Hierarchy Theory

Abraham Maslow proposed that human needs are arranged in a pyramid from lowest to highest. Once
a lower need is satisfied, the person moves to the next level.

• 5. Self-Actualisation: Reaching one's full potential; doing something meaningful and challenging
• 4. Esteem Needs: Self-respect, recognition, prestige, status, confidence
• 3. Social Needs: Belonging, friendship, love, group membership
• 2. Safety Needs: Job security, safe working conditions, pension, insurance
• 1. Physiological Needs: Basic survival: pay, food, shelter, water, rest
Criticism: Hierarchy doesn't always hold; people satisfy higher needs before lower ones are fully met;
needs are subjective.

2. Herzberg's Two-Factor Theory

Fredrick Herzberg identified two sets of factors affecting job satisfaction:

• Hygiene Factors (Maintenance): If absent, cause dissatisfaction. But their presence does NOT
motivate. Examples: Salary, job security, working conditions, company policy, supervision,
interpersonal relations.
• Motivational Factors (Satisfiers): These actually motivate employees. Examples: Achievement,
recognition, the work itself, responsibility, advancement, personal growth.
■ Simple memory tip: Hygiene factors = STOP dissatisfaction. Motivators = START motivation.
3. McGregor's Theory X and Theory Y
Theory X Assumptions Theory Y Assumptions
People dislike work and avoid it People naturally enjoy working
Need to be coerced and threatened Are self-directed and self-controlled
Avoid responsibility Willingly accept responsibility
Are not ambitious Are creative and innovative
Are self-centred Are committed to organisational goals

4. Theory Z
Proposed by Urwick, Rangnekar, and Ouchi. Combines best of Japanese and American management.
Key features: Strong organisation-employee bonding, employee involvement, human resource
development, no rigid hierarchy.

5. Alderfer's ERG Theory

Simplified Maslow's theory into 3 needs:

• E – Existence: Basic material/survival needs (similar to Maslow's physiological + safety)

• R – Relatedness: Social relationships (similar to Maslow's social needs)
• G – Growth: Personal development and fulfilment (similar to esteem + self-actualisation)
■ Key difference from Maslow: ERG allows REGRESSION — if a higher need is frustrated, the person
refocuses on a lower need.

6. McClelland's Three Need Theory

• Need for Achievement (nAch): Desire to do something better/efficiently. High achievers set
challenging but realistic goals, want feedback, take personal responsibility.
• Need for Power (nPow): Desire to influence and control others. High nPow people want leadership
roles.
• Need for Affiliation (nAff): Desire for warm, friendly relationships. High nAff people seek approval and
confirmation.

3.4 Process Theories of Motivation

■ Process theories explain HOW motivation works — the mental process a person goes through.

1. Vroom's Expectancy Theory

Victor Vroom said motivation depends on three beliefs:

• Expectancy (E): "If I try hard, will I perform well?" (effort → performance link)
• Instrumentality (I): "If I perform well, will I get a reward?" (performance → reward link)
• Valence (V): "Is this reward valuable to me?" (value of reward)
Formula: Motivation = E × I × V

■ If ANY one of these is zero, motivation becomes zero. All three must be high for strong motivation.

2. Porter & Lawler's Expectancy Theory

A more complex version. Motivation → Effort → Performance → Rewards → Satisfaction. Performance
depends on ability and role perception, not just effort. Intrinsic rewards (satisfaction, growth) and extrinsic
rewards (pay, promotion) both matter.

3. Adam's Equity Theory

People compare their Input/Outcome ratio with others. If they feel the ratio is unfair (inequity), they get
de-motivated.

• Inputs: Education, skills, effort, experience

• Outcomes: Pay, promotion, recognition, benefits
When inequity is felt, people may: reduce effort, demand more pay, change their comparison person, or
quit the job.

Content vs Process Theories – Difference

Basis Content Theories Process Theories
Focus WHAT motivates (needs) HOW motivation works (process)
Examples Maslow, Herzberg, McClelland Vroom, Adams, Porter & Lawler
Approach Internal needs and drives Cognitive processes, expectations
Application Identify employee needs Design reward and work systems
UNIT 4: LEADERSHIP
Definition: Leadership is the ability of a manager to induce subordinates to work with confidence and zeal
towards a common goal. It is the human factor that binds a group together and motivates towards a goal.

4.1 Difference: Leader vs Manager

Leader Manager
Innovator Administrator
Challenges the status quo Accepts the status quo
Does the right things Does things right
Copes with change Copes with complexity
Creates vision and strategy Plans and budgets
Influences voluntarily Exercises formal authority
Motivates through values and involvement Controls and solves problems

4.2 Theories of Leadership

1. Trait Theory
A leader is born with certain qualities that separate them from non-leaders. Key traits include: Intelligence,
physical appearance, emotional stability, inner motivation, empathy, vision, fairness, communication skills,
self-confidence, and technical skills.

Criticism: Traits alone don't predict leadership success; psychological traits can't be measured; ignores
situational factors.

2. Behavioural Theories
• Michigan Studies: Two styles — (a) Production-centred (task focus, strict supervision) vs (b)
Employee-centred (participative, builds trust). Conclusion: Employee-centred leads to higher
productivity and satisfaction.
• Ohio State Studies: Two dimensions — (a) Initiating Structure (organising work and roles) and (b)
Consideration (trust, respect, care for employees). Best leaders are HIGH on both.

3. Contingency Theory (Fiedler)

Leadership effectiveness depends on the situation. Three situational factors:

• Leader-Follower Relations: How much followers trust and respect the leader
• Task Structure: How clearly defined and structured the task is
• Position Power: How much authority/power the leader's position carries
Favourable situation = trusted leader + structured task + strong position power.

4. Path-Goal Leadership Theory (Robert House)

Leaders motivate by making the path to goals clear and removing obstacles. Four leadership styles:

• Directive: Give clear instructions and directions

• Supportive: Be friendly and approachable
• Participative: Ask subordinates for suggestions before deciding
 • Achievement-Oriented: Set challenging goals; expect high performance

5. Situational Leadership Theory (Hersey & Blanchard)

Leadership style should match the maturity level of followers. Maturity = ability + willingness.

Maturity Level Recommended Style

1. Low ability, low willingness Telling – give clear instructions, close supervision
2. Low ability, high willingness Selling/Coaching – explain and persuade
3. High ability, low willingness Participating/Supporting – share decision-making
4. High ability, high willingness Delegating – hand over responsibility

6. Managerial Grid (Blake & Mouton)

A 9×9 grid based on two dimensions: Concern for Production (horizontal) and Concern for People
(vertical). Five key styles:

Style Grid Position Description

Impoverished (1,1) Low concern for both – minimal effort, avoids responsibility
Country Club (1,9) High concern for people, low for production – cosy workplace but low outp
Authority-Obedience (9,1) High production focus, low people concern – autocratic, task-driven
Team Manager (9,9) High on both – best style; achieves results through motivated team
Organisation Man (5,5) Moderate on both – compromise; adequate but not excellent

4.3 Leadership Styles

• Autocratic/Authoritative: Leader makes all decisions alone. Subordinates follow orders. Suitable for
inexperienced staff/urgent decisions. Disadvantage: low morale, creativity suppressed.
• Democratic/Participative: Leader consults subordinates before deciding. Increases morale and
commitment. Disadvantage: slow decisions, dominant members may influence unfairly.
• Laissez-Faire/Free-Rein: Leader gives full freedom to subordinates. Best when team is highly skilled
and self-motivated. Disadvantage: can lead to chaos, lack of direction.

4.4 Transactional vs Transformational Leadership

• Transactional Leadership: Based on exchange — reward for performance. Leaders set goals,
employees meet them. Relies on authority and rewards/punishments. More managerial in nature.
• Transformational Leadership: Inspires people to go beyond self-interest for a higher purpose. Builds
commitment, elevates followers' values and capabilities. Examples: Gandhi, Narayana Murthy. Based
on vision, passion, and energy.
UNIT 5: GROUP DYNAMICS, TEAM BUILDING, CONFLICT &
NEGOTIATION
5.1 Group Dynamics
Definition: A group is a collection of two or more interacting individuals with a stable relationship, sharing
common goals and perceiving themselves as a group.

Types of Groups
• Formal Groups: Created by the organisation with designated work. Types: Command Groups, Task
Forces, Committees, Project Groups
• Informal Groups: Arise naturally based on social interaction. Types: Interest Groups, Friendship
Groups, Reference Groups
• Open Groups: Membership constantly changes
• Closed Groups: Stable membership
• In-Groups: Groups we belong to | Out-Groups: Groups we don't belong to

Why Do People Join Groups?

• Security – protection from threats
• Esteem – feel valued and recognised
• Affiliation – social interaction and belonging
• Power – greater influence together
• Identity – sense of who you are
• Proximity – working near others naturally creates groups

Tuckman's Stages of Group Development

• Forming: Uncertainty; group just formed; people are polite and cautious
• Storming: Conflict begins; people assert opinions; roles are disputed
• Norming: Group settles; norms established; cooperation improves
• Performing: Group is fully functional; focused on achieving goals
• Adjourning: Task complete; group dissolves; members may feel sadness

5.2 Group Behaviour

Group Norms
Group norms are unwritten rules about how members should behave. They are developed gradually,
apply to behaviour (not private thoughts), and help predict/control group behaviour.

Group Cohesion
Cohesion means how strongly members are attracted to the group and want to stay. High cohesion =
strong loyalty, frequent interaction, united against external threats. Ways to increase cohesion:

• Create agreement on group goals

• Increase homogeneity of members
• Encourage frequent interaction
 • Reduce group size
• Create competition with rival groups
• Give group rewards, not just individual ones

Group Decision Making

Groups make decisions through: Diagnosing the problem → Developing alternatives → Evaluating and
selecting → Implementing and monitoring.

Advantages: More knowledge/expertise, multiple perspectives, higher participation and commitment.

Disadvantages: Time-consuming, dominant members may influence, decisions may be compromises.

Techniques to Improve Group Decision Making

• Brainstorming (Alex Osborn): Generate as many ideas as possible without criticism
• Nominal Group Technique: Ideas written individually, then discussed/voted
• Delphi Technique: Anonymous questionnaires used to reach consensus
• Consensus Mapping: Clustering and mapping ideas to reach agreement

5.3 Team Building

Definition: "A team is a group whose members have complementary skills and are committed to a
common purpose for which they hold themselves mutually accountable."

Group vs Team
Group Team
Individual work; members independently complete Interdependent
tasks work; members depend on each other
Individual accountability only Both individual AND mutual accountability
Management sets goals and approach Team sets its own goals, timing, and approach
May share a common interest Share a strong common commitment to purpose

Types of Teams
• Lead Teams
• Problem-Solving Teams
• Self-Managed Teams
• Cross-Functional Teams
• Virtual Teams

5.4 Conflict
Definition: Conflict is the struggle between incompatible needs, wishes, ideas, interests or people. It
arises when two parties cannot both obtain what they want satisfactorily.

Sources of Conflict
• Structural Factors: Task specialisation, interdependence (pooled/sequential/reciprocal), resource
competition, goal differences, authority relationships, status inconsistencies
• Personal Factors: Different skills, personalities, perceptions, values, emotions, communication
barriers, cultural differences
Types of Conflict
• Intra-individual (within oneself)
• Inter-individual (between two people)
• Intra-group (within a group)
• Inter-group (between groups)
• Intra-organisational (within the organisation)
• Inter-organisational (between organisations)

Stages of Conflict Process

• 1. Latent Conflict: Conditions for conflict exist but not yet visible
• 2. Perceived Conflict: Parties become aware of the conflict
• 3. Felt Conflict: Emotional response — tension, anxiety, hostility
• 4. Manifest Conflict: Open conflict — arguments, reduced cooperation, aggression
• 5. Conflict Outcome: Resolution: either Functional (constructive) or Dysfunctional (destructive)

Conflict Management Strategies (Thomas)

Thomas classified 5 styles based on Assertiveness (concern for self) and Cooperativeness (concern for
others):

• Competing: High assertive, low cooperative – win at others' expense

• Collaborating: High assertive, high cooperative – best solution for both (win-win)
• Compromising: Moderate on both – give and take; partially satisfies both
• Avoiding: Low assertive, low cooperative – ignore the conflict
• Accommodating: Low assertive, high cooperative – give in to the other party

5.5 Negotiations
Negotiation Strategies
• Distributive Bargaining (Win-Lose): Fixed pie — one side gains what the other loses. Competitive.
Each party tries to maximise their share. Used when interests are directly opposed.
• Integrative Bargaining (Win-Win): Expand the pie — both parties benefit. Collaborative. Focuses on
interests, not positions. Creates value for both sides. Preferred for long-term relationships.

Negotiation Process
• Preparation and Goal Setting
• Clarify Ground Rules
• Communicate Effectively
• Make Concessions for Bargaining
• Implementation

Guidelines for Effective Negotiation

• Do thorough preparation before negotiating
• Enter with a positive attitude
• Use a win-win approach
• Show empathy for the other party
 • Address the problem, not the person
• Use objective criteria
• Be aware of cultural and gender differences

Third Party Negotiation

• Mediation: A neutral third party facilitates discussion and helps parties reach an agreement
• Arbitration: Third party hears both sides and makes a binding decision
• Inquisition: Third party controls the entire process and imposes a resolution
UNIT 6: ORGANISATIONAL STRUCTURE, CULTURE & CHANGE
6.1 Organisational Structure
Definition: "The formal allocation of work roles and administrative mechanisms to control and integrate
work activities. Job tasks are formally divided, grouped and coordinated."

Key Elements of Organisational Structure

• Work Specialisation: Dividing work into specific tasks for efficiency
• Departmentalisation: Grouping jobs by function, product, geography, etc.
• Chain of Command: Line of authority from top to bottom
• Span of Control: Number of employees a manager supervises
• Centralisation: Decision-making concentrated at the top
• Decentralisation: Decision-making distributed to lower levels
• Formalization: Degree to which jobs are standardised by rules
• Standardisation: Uniform procedures throughout the organisation

Types of Organisational Structure

• Functional Structure: Grouped by department (HR, Finance, Marketing). Simple, clear roles. Can
create silos.
• Product-Based Structure: Grouped by product line. Each product group has its own functions
(Production, Sales, R&D;).
• Divisional Structure: Grouped by geography, product, or customer segment. Each division is
semi-autonomous.
• Matrix Structure: Combination of functional and project structures. Dual reporting (to functional
manager AND project manager). Flexible but can cause confusion.
• Hybrid Structure: Combination of functional and divisional. Some departments are shared; others are
product-specific.
• Network Structure: Organisation outsources most functions. A small core coordinates external
partners and contractors.

Mintzberg's Five Structural Configurations

• Simple Structure: Small, flat; centralised; owner/manager controls directly
• Machine Bureaucracy: Highly formalised; standardised processes; large mid-level management
• Professional Bureaucracy: Power with skilled professionals (hospitals, universities)
• Divisionalized Form: Multiple semi-autonomous divisions under a HQ
• Adhocracy: Flexible, innovative; project teams; no permanent structure

6.2 Organisational Culture

Definition: Culture is "a pattern of basic assumptions invented or developed by a group as it learns to
cope with problems of external adaptation and internal integration — taught to new members as the
correct way to perceive, think and feel."

Characteristics of Organisational Culture

• Observed behavioural regularities – how people typically interact
 • Norms – standards of behaviour
• Dominant values – what the organisation stands for
• Philosophy – policies and people management
• Rules – explicit and implicit guidelines
• Organisational climate – overall 'feel' of the organisation

Functions of Culture
• Provides shared patterns of thinking and behaving
• Distinguishes one organisation from another
• Builds commitment beyond individual self-interest
• Enhances social stability and unity
• Serves as a control mechanism for behaviour
• Ensures everyone moves in the same direction

Types of Culture
• Dominant Culture: Core values shared by most members
• Subculture: Values specific to a department or unit within the org
• Strong Culture: Widely shared and deeply held values
• Weak Culture: Limited sharing of values; easier to change

Creating, Sustaining & Changing Culture

• Creating: Founders set the original values and vision, which get embedded through socialisation.
• Sustaining: Through Selection (hiring compatible people), Top Management behaviour, and
Socialisation (onboarding/training).
• Changing: Deal and Kennedy identify 5 situations favouring culture change: rapid environment change,
highly competitive industry, company is mediocre, becoming a large corporation, rapid growth.

How Is Culture Learnt?

• Stories: Narratives about key events and people in the organisation's history
• Rituals: Repeated activities that reinforce values (award ceremonies, team meetings)
• Symbols: Physical artefacts, logos, dress codes
• Language: Unique terms, acronyms, jargon used within the organisation

6.3 Organisational Change

Definition: Change refers to any alteration in the overall work environment of an organisation. It is
inevitable — organisations must change or die.

Factors Affecting Organisational Change

• External Factors: Technological changes, market conditions, social pressures, political/legal
requirements, workforce diversity, globalisation
• Internal Factors: Change in managerial personnel, organisational deficiencies, new technology, crisis
management, employee pressure

The Change Process (6 Stages)

• 1. Becoming aware of pressure for change
 • 2. Recognising the need for change
• 3. Diagnosing the problem
• 4. Planning the change
• 5. Implementing the change
• 6. Following up on the change

Resistance to Change
Resistance is the most baffling problem managers face. It occurs at three levels:

• Organisational Resistance: Structural inertia, cultural barriers, resource constraints, threat to power
• Group Resistance: Group norms, cohesiveness, groupthink, vested interests
• Individual Resistance: Cognitive biases, fear of the unknown, habit, distrust of management, fear of
loss, new learning required

Overcoming Resistance to Change

• Education & Communication: Explain why change is needed; clear information reduces fear
• Participation: Involve employees in planning the change
• Facilitation & Support: Provide training and counselling for those affected
• Negotiation: Offer trade-offs to resistant groups
• Manipulation & Co-optation: Selectively use information; bring influential resisters into change team
• Coercion: Force as a last resort (threats, transfers)

Kurt Lewin's Change Model (3 Steps)

Lewin's model is the most widely used model for managing organisational change:

• 1. Unfreezing: Shake up the status quo. Create awareness that current behaviour is inadequate.
Motivate employees to accept the need for change. Communication is critical at this stage.
• 2. Changing (Transitioning): Implement the change. Employees learn new behaviours, processes,
and ways of thinking. Requires education, support, and time.
• 3. Refreezing: Reinforce and stabilise the new behaviour. Make the new way of doing things the norm.
Prevents reverting to old ways. Reward adoption of new behaviours.
■ Memory trick: UNFREEZE (shake it up) → CHANGE (do it) → REFREEZE (lock it in)
UNIT 7: ORGANISATION DEVELOPMENT (OD)
Definition: OD is "a systematic, integrated and planned approach to improve the effectiveness of the
enterprise. It is designed to solve problems that adversely affect the operational efficiency at all levels."

OD uses behavioural science knowledge to help organisations adapt to change. It focuses on the whole
culture — beliefs, attitudes, values and structures.

7.1 Characteristics of OD
• Long-range effort – takes time to produce lasting results
• Broad base – covers the whole organisation
• Dynamic process – continuously adapts
• System view – looks at the whole organisation
• Research-based – backed by data
• Goal-setting and re-educative strategy

7.2 Objectives of OD
• Increase trust and mutual support among all members
• Minimise interpersonal conflict
• Create a healthy, positive work environment
• Increase personal satisfaction and enthusiasm
• Identify and solve organisational problems

7.3 Process of OD
• 1. Problem Identification – recognise gaps between actual and desired performance
• 2. Diagnosis – collect and analyse data to understand root causes
• 3. Planning Strategy for Change – develop action plans; consulting plays a key role
• 4. Intervening in the System – implement planned activities through training, team building, etc.
• 5. Evaluation – measure outcomes; gather feedback; make modifications

7.4 OD Models
• 1. Kurt Lewin's Model: Unfreezing → Changing → Refreezing. Prepare people for change, make the
change, then stabilise.
• 2. Greiner's Model: Change occurs in sequential stages triggered by external stimulus. Phases:
Pressure on management → Intervention → Diagnosis → Invention of solutions → Experimentation →
Reinforcement from positive results.
• 3. Leavitt's Model: Four interacting subsystems — Task, Structure, Technology, and People. Change
in any one affects all others. Diamond-shaped model.
• 4. Action Research Model: Change begins with problem awareness/diagnosis → data collection →
feedback → action planning → implementation → re-evaluation. Cyclical process.

7.5 OD Interventions
OD interventions are structured activities designed to improve organisational effectiveness.

A. Individual-Focused Interventions
• Sensitivity Training / T-Groups – self-awareness and interpersonal skills
• Skill Training – job-specific competency development
• Job Redesign – modify tasks to improve motivation and fit
• Role Negotiation – clarify expectations between roles
• Career Planning – help individuals map career paths
• Management Development Training – leadership and managerial skills

B. Group/Organisation-Focused Interventions
• Survey Feedback: Collect data through surveys, give feedback to employees, create action plans
• Management by Objectives (MBO): Set goals → implement → evaluate performance against goals
• Quality of Work Life (QWL): Improve work conditions, autonomy, and employee wellbeing
• Team Building: Improve team dynamics, trust, communication, and collaboration
• Process Consultation: External consultant helps diagnose and solve group process issues
• Grid Training: Based on Managerial Grid; develop Team Manager (9,9) style across the organisation

Factors Influencing Choice of OD Intervention

• Applicability: Is it relevant to the problem?
• Feasibility: Can it be implemented with available resources?
• Acceptability: Will people accept and participate in it?
UNIT 8: ORGANISATIONAL CITIZENSHIP BEHAVIOUR (OCB)
Definition: "Individual behaviour that is discretionary, not directly or explicitly recognised by the formal
reward system, and that in the aggregate promotes the effective functioning of the organisation."

In short: OCB = going beyond your job description voluntarily for the good of the organisation.

8.1 Theoretical Perspective of OCB

Employees play two roles: In-role (formal job responsibilities) and Extra-role (going beyond). OCB is a
type of extra-role behaviour. Employees who are satisfied and committed to the organisation tend to show
higher OCB. It promotes teamwork, better communication, reduces attrition, and improves employee
retention.

8.2 Determinants of OCB

• Courtesy: Preventing work-related problems for others; being considerate
• Altruism: Voluntary help to others with work-related tasks
• Sportsmanship: Tolerating inconveniences without complaining
• Conscientiousness: Going beyond minimum role requirements
• Loyalty: Standing up for and promoting the organisation
• Civic Virtue: Active participation in organisational governance
• Extra-role Behaviour: Going above and beyond normal job requirements
• Commitment: Dedicated to organisational goals and values

8.3 Predictors of OCB

• Personality variables
• Job satisfaction
• Duration of employee relationship with organisation
• Psychological contracts
• Leadership ability
• Organisational culture

End of Study Notes | All the best for your exams!