UNIT - I Organizational Behaviour

Definition, need and importance of organizational

behaviour – Nature and scope – Frame work –
Organizational behaviour models.
1.1 DEFINITION

“OB is the study of human behaviour in organisational setting, of the interface between
human behaviour and organisation and of the organisation itself.”- K Aswathappa
“OB is a field of study that investigates the impact that individuals, groups and structures
have on behaviour within organisations for the purpose of applying such knowledge towards
improving an organisation’s effectiveness.”- Stephen P. Robbins
“Organisational behaviour can be defined as the study and application of knowledge about
human behaviour related to other elements of an organisation such as structure, technology
and social systems.”- L. M. Prasad
“Organisational behaviour is the study and application of knowledge about how people act
within organisations.”- Davis and Newstram
“Behaviour is directly concerned with the understanding, prediction and control of human
behaviour in organisations.”- Fred Luthans
“Organisational behaviour is the study and application of knowledge about how people as
individuals and as groups act within organisations. It strives to identify ways in which people
can act more effectively.”- John Newstram and Keith Devis
OB is the study of individual behaviour in isolation, when in group and as a part of an
organisation. The study of individual behaviour only, would be incomplete because behaviour
is affected by the people surrounding us as well as by the organisation, in which we work.
Studying only individuals or only organisations would be of no use. It is essential to study
both simultaneously.
Personality, perception, learning, attitude, family background, training, motivation, job
satisfaction, performance appraisal, leadership effectiveness, norms, values and ethics are the
factors which affect the individual behaviour. Group dynamics, communication,
organisational environment, individual and organisational culture affect group behaviour.
Organisational structure, power & politics, status, relation with juniors & seniors, conflicts
and culture affect the individual behaviour in the organisation.
These various factors relate to different disciplines including psychology, sociology, social
psychology, political science, anthropology, etc.
Study about individual behaviour, group behaviour and organisations give the inferences
about how different people react to different situations. It guides regarding the motivation
styles and the leadership styles to be adopted for different persons. Due to the individual
differences, diverse leadership styles, incentive schemes, motivators, communication styles
should be applied.

1.2 NEED AND IMPORTANCE OF ORGANIZATIONAL BEHAVIOUR

Organizational Behaviour is an applied behavioural science that is built on contribution from a

number of other behavioural discipline like psychology, sociology, social psychology,
anthropology and political science. Understanding Organizational Behaviour is becoming very
important for managers. Due to global competition, it is becoming necessary for the employees to
become more flexible and to cope with rapid changes. It is becoming challenging for the managers
to use Organizational Behaviour concepts. Organizations are no longer constrained by national
borders. Burger King is owned by a British firm, and McDonald’s sell hamburgers in Moscow.
Exaction Mobile, an American company receives 75% of its revenue from sales outside US. All
the major automobile manufactures build their cars out side their border, for example, Honda
builds cars in Ohio, USA, Ford in Brazil and Mercedes and BMW in South Africa. This shows
that the world has become a global village. Hence, managers have to diversify work force . Work
force diversity means the organizations are becoming more heterogeneous in terms of gender, race
and ethnicity. Diversity if managed positively, can increase creativity and innovation in
organizations as well as improve decision making by providing different perspective on preplans.
Quality management is driven by the constant attainment of customer satisfaction through
continuous improvement of all organizational processes (productivity, absenteeism, turnover, job
satisfaction and recently added fifth dependent variable is organizational citizenship).

NEED OF ORGANIZATIONAL BEHAVIOR

The significance of organisational behaviour is evident in its ability to enhance employee

engagement and productivity. While structures and processes are important, it's the human element
that drives performance, innovation, and overall success. The significance of organisational is as
follows:
• Understanding Human Behavior: It helps organizations understand why employees behave
the way they do, their motivations, and their reactions to different situations.
• Improving Employee Performance: By understanding employee needs and motivations,
organizations can create a more conducive work environment that fosters higher performance and
job satisfaction.
• Effective Leadership: OB provides insights into effective leadership styles and their impact
on employee morale and productivity.
• Enhanced Communication: It helps organizations improve communication channels and
address potential barriers to effective communication.
• Stronger Organizational Culture: OB assists in creating and maintaining a positive and
supportive organizational culture that fosters employee engagement and loyalty.
• Conflict Resolution: It offers strategies for managing and resolving conflicts, preventing
negative consequences and maintaining a harmonious work environment.
• Adaptability: OB helps organizations adapt to changing circumstances, such as
technological advancements or economic shifts.

IMPORTANCE OF ORGANIZATION BEHAVIOR:

1. It builds better relationship by achieving, people, organizational, and social objectives.
 2. It covers a wide array of human resource like Behavior, training and development, change
management, leadership, teams etc.
3. It brings coordination which is the essence of management.
4. It improves goodwill of the organization.
5. It helps to achieve objectives quickly.
6. It makes optimum utilization of resources.
7. It facilitates motivation.
8. It leads to higher efficiency.
9. It improves relations in the organization.
10. It is multidisciplinary in the sense that applies different techniques, methods, and theories to
evaluate the performances.

1.3 NATURE AND SCOPE OF ORGANIZATIONAL BEHAVIOUR

Nature of Organizational Behaviour

1. A Separate Field of Study and Not a Discipline Only:
By definition, a discipline is an accepted science that is based on a theoretical foundation.
But, O.B. has a multi- interdisciplinary orientation and is, thus, not based on a specific
theoretical background. Therefore, it is better reasonable to call O.B. a separate field of study
rather than a discipline only.
2. An Interdisciplinary Approach:
Organizational behaviour is essentially an interdisci¬plinary approach to study human
behaviour at work. It tries to integrate the relevant knowledge drawn from re¬lated disciplines
like psychology, sociology and anthro¬pology to make them applicable for studying and
analysing organizational behaviour.
3. An Applied Science:
The very nature of O.B. is applied. What O.B. basically does is the application of various
researches to solve the organizational problems related to human behaviour. The basic line of
difference between pure science and O.B. is that while the former concentrates of fundamental
researches, the latter concentrates on applied researches. O.B. involves both applied research
and its application in organizational analysis. Hence, O.B. can be called both science as well
as art.
4. A Normative Science:
Organizational Behaviour is a normative science also. While the positive science discusses
only cause effect relationship, O.B. prescribes how the findings of applied researches can be
applied to socially accepted organizational goals. Thus, O.B. deals with what is accepted by
individuals and society engaged in an organization. Yes, it is not that O.B. is not normative
at all. In fact, O.B. is normative as well that is well underscored by the proliferation of
management theories.
5. A Humanistic and Optimistic Approach:
Organizational Behaviour applies humanistic approach towards people working in the
organization. It, deals with the thinking and feeling of human beings. O.B. is based on the
belief that people have an innate desire to be independent, creative and productive. It als o
realizes that people working in the organization can and will actualise these potentials if they
are given proper conditions and environment. Environment affects performance or workers
working in an organization.
6 A Total System Approach:
The system approach is one that integrates all the variables, affecting organizational
functioning. The systems approach has been developed by the behavioural scientists to
analyse human behaviour in view of his/her socio-psychological framework. Man’s socio-
psychological framework makes man a complex one and the systems approach tries to study
his/her complexity and find solution to it.
SCOPE OF THE ORGANIZATIONAL BEHAVIOR
 Impact of personality on performance
 Employee motivation
 Leadership
 How to create effective teams and groups
 Study of different organizational structures
 Individual behavior, attitude and learning
 Perception
 Design and development of effective organization
 Job design
 Impact of culture on organizational behavior
 Management of change
 Management of conflict and stress
 Organizational development
 Organizational culture
 Transactional analysis
 Group behavior, power and politics
 Job design
 Study of emotions

The field of the organizational behavior does not depend upon deductions based on gut
feelings but attempts to gather information regarding an issue in a scientific manner under
controlled conditions. It uses information and interprets the findings so that the behavior of
an individual and group can be canalized as desired.
Large number of psychologists, social scientists and academicians has carried out research on
various issues related to organization behavior. Employee performance and job satisfaction
are determinants of accomplishment of individual and organizational goals.
Organizations have been set up to fulfill needs of the people. In today’s competitive world,
the organizations have to be growth-oriented. This is possible when productivity is ensured
with respect to quantity of product to be produced with zero error quality. Emp loyee
absenteeism and turnover has a negative impact on productivity.
Employee who absents frequently cannot contribute towards productivity and growth of the
organization. In the same manner, employee turnover causes increased cost of production. Job
satisfaction is a major factor to analyze performance of an individual towards his work.
Satisfied workers are productive workers who contribute towards building an appropriate
work culture in an organization.
Organizations are composed of number of individuals working independently or collectively
in teams, and number of such teams makes a department and number of such departments
makes an organization. It is a formal structure and all departments have to function in a
coordinated manner to achieve the organizational objective.
It is therefore important for all employees to possess a positive attitude towards work. They
need to function in congenial atmosphere and accomplish assigned goals. It is also important
for managers to develop an appropriate work culture. Use of authority, delegation of certain
powers to subordinates, division of labor, efficient communication.
Benchmarking, re-engineering, job re-design and empowerment are some of the important
factors so that an organization can function as well-oiled machine. This is not only applicable
to manufacturing organizations but also to service and social organizations.

1.4 FRAME WORKS

OB is the study of behavior which are not visible. Hence some theories and concepts are developed
related to thinking and using the concepts to explain human behavior and to give a framework to
understand predict and manage the behavior of people at organization.
There are three conceptual framework :
1. Cognitive Framework
2. Behavioristic Framework
3. Social Cognitive Framework

Cognitive Framework Cognitive approach emphasizes the positive and freewill aspects of human
behavior and uses concepts such as expectancy, demand, and intention. Cognition can be simply
defined as the act of knowing an item of information. In cognitive framework, cognitions precede
behavior and constitute input into the person’s thinking, perception, problem solving, and
information processing. The work of Edward Tolman can be used to represent the cognitive
theoretical approach. According to Tolman, learning consists of the expectancy that a particular
event will lead to a 12 particular consequence. This cognitive concept of expectancy implies that
organism is thinking about, or is conscious or aware of the goal and result of a behavior exhibited
by it. It means that a person desires a goal and also knows the behavior that will lead to
achievement of the goals. In the subject of organizational behavior, cognitive approach dominates
the units of analysis such as perception, personality and attitudes, motivation, behavioral decision
making and goal setting.

Behavioristic Framework Pioneer behaviorists Ivan Pavlov and Jon B. Watson stressed the
importance of studying observable behaviors instead of the elusive mind. They advocated that
behavior could be best understood in terms of stimulus and response (S-R). They examined the
impact of stimulus and felt that learning occurred when the S-R connection was made. Modern
behaviorism, that marks its beginning with B.F. Skinner, advocates that behavior in response to a
stimulus is contingent on environmental consequences. Thus, it is important to note that
behaviortistic approach is based on observable behavior and environmental variables (which are
also observable).

Social Cognitive Framework Social learning theory takes the position that behavior can best be
explained in terms of a continuous reciprocal interaction among cognitive, behavioral, and
environmental determinants. The person and the environmental situation do not function as
independent units but, in conjunction with behavior itself, reciprocally interact to determine
behavior. It means that cognitive variables and environmental variables are relevant, but the
experiences generated by previous behavior also partly determine what a person becomes and can
do, which, in turn, affects subsequently behavior. A persons cognition or understanding changes
according to the experience of consequences of past behavior.

Bandura developed social learning theory into the more comprehensive social cognitive theory
(SCT). Stajkovic and Luthans have translated this SCT into the theoretical framework for
organizational behavior. Social cognitive theory recognizes the 13 importance of behaviorism‘s
contingent environmental consequences, but also includes cognitive processes of self regulation.
The social part acknowledges the social origins of much of human thought and action (what
individual learns from society), whereas the cognitive portion recognizes the influential
contribution of thought processes to human motivation, attitudes, and action. In social cognitive
theoretical framework, organizational participants are at the same time both products and
producers of their personality, respective environments, and behaviors. The participants as a group
of produce the environment, every individual is a product of the enironment and through his
behavior changes the environment for others as well as for himself, every individual is a product
of his personality, but also influences his personality as consequence of results of his behavior.

1.5 ORGANIZATIONAL BEHAVIOUR MODELS

Every organization develops a particular model in which behaviour of the people takes place.
This model is developed on the basis of management’s assumptions about people and the
vision of the management. Since these assumptions vary to a great extent, these result into
the development of different organizational behaviour models (OB models).
1. Autocratic
2. Custodial
3. Supportive
4. Collegial.

1. Autocratic Model

In this model, it is believed that those who are part of the management have the expertise,
knowledge and skills required to run the business and the day to day activities. It is also
assumed that that those at the floor level lack skills to do the work on their own. Hence, it is
presumed that they need to be micro-managed by those in power. They do not usually have
any say in the functioning of the organisation. Even their opinions and suggestions are not
sought by the management, since it is believed that they are not capable of making any
worthwhile suggestion. The owners exercise absolute command over their employees, and
likewise, the employees obey their seniors. Autocratic model is one of the oldest models of
OB and was successful to a great extent during the period of Industrial Revolution. However,
it is not without its drawbacks.

Employees are unlikely to experience job satisfaction, as they lack involvement in the
business process. They do not have any control on what they do at the workplace. Such an
arrangement is not suitable for a modern day organisation in which many job roles are donned
by specialists who have considerable expertise in the field. In certain present day industries,
it will not be an exaggeration to say that those at the top, although will be having an idea
about the bigger picture, won’t have the requisite skills to direct the activities of the lower
level employees.

2. Custodial Model

This model came into existence as a result of the limitations of the Autocratic model. In the
autocratic model, the employees are afraid of the management and hence they do not rebel or
oppose their commands. However, they might harbor feelings of antipathy within themselves
if they are not treated fairly, and might vent out their hatred at some future point in time. To
address this issue, the custodial model of OB was introduced. As per this model, the welfare
of the employees is looked after by the management, by offering economic security to them.
Other welfare measures like crèche for the kids of the employees, medical benefits etc., are
also introduced as part of the Custodial model. The employee becomes dependent on these
welfare measures and irrespective of whether they are satisfied with the job per se or not, they
think twice before quitting the organisation.

3. Supportive Model
In the Autocratic model, power and authority are the main aspects that keep the model
running. In the case of Custodial model, however, it is the incentives that are the driving force.
In contrast, neither power nor incentives are key elements in a supportive model. Harmonious
relationship between the management and the employees motivate employees working in an
organisation in which supportive model is employed. The leadership style in the supportive
model is such that the employees are allowed to grow and flourish.

4. Collegial Model

In the Collegial model everybody works as colleagues. Thus, team-work is the key factor in
this model. Everybody participates in the growth of the organisation. The manager acts like a
coach to develop team spirit among the employees. The coach is less concerned about his own
performance, but more about the performance of the team. This model is effective in industries
that by their very nature have to innovate. The team work as envisaged in the model produces
new ideas and path-breaking discoveries.

5. Systems Model

This is the most recent of the five models. In the Systems model, an organization
acknowledges that individuals have different goals, talents and potential. The aim of the
Systems model is to strike a balance between the goals of the employees with the goals of the
organisation. Individuals obviously want good remuneration, job security, etc. The
organisation should find out ways to reach win-win situations, where the needs of the
employees are fulfilled even while they add value to the organization.