Organisational
Behaviour
Chapter 1
What is Organisational
Behaviour?
How we study organisations and the
people who make them work
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
In this chapter we want to:
•
•
•
•
Introduce the discipline of OB
Trace its intellectual roots
Discuss its value as a field of academic study
Outline the main threads of interest to
students of OB to date
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The four dimensions of OB
1. The individual dimension: the relationship of the
individual to the organisation they work in
2. The group dimension: how people interact and work
together in organisations
3. The dimension of the whole organisation: how
individuals and groups combine and co-ordinate their efforts
to deliver the goals of the organisation
4. The dimension of the organisational context:
the contextual variables which have an effect on how an
organisations operates
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
How we study OB
• Research methods from the social sciences
• Two broad approaches:
1. Quantitive research which tests a hypothesis by
observation and statistical analysis.
2. Quantitive research which tries to understand a
phenomenon through the experiences and
feelings of the people involved in it
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
What we have learned from OB so far
• We can identify four main approaches:
1. The classical approach: the theories we put into
this category tend to emphasise productive
efficiency. As an approach it seeks to find a set of
principles which are generally applicable across
all organisations at all times. The theories in this
category are among the oldest in the field.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
2. The Human Relations approach. Theories in this
category tend to focus on the well-being of workers
in the organisation. It is premised on the idea that
work is important to the well-being of people. So
happy, well-motivated and well-led staff will
perform better than those who are not.
Consequently, management should pay attention to
making work meaningful and satisfying,
emotionally, psychologically and socially.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
3. The systems approach.
This is an approach which
specifically examines the organisation in a context. A simple
system has three components:
Inputs
Things which are
taken from the
organisation’s
environment to be
used in its
activities
Transformation
Inputs are used to
produce goods or
services
Outputs
The goods and
services which the
organisation was
designed to create
Needless to say, the reality is much more complex than this
but a three stage simple system is a useful starting point.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
4. The contingency approach. This is an approach
which says that the environment in which an
individual organisation exists is unique to it. Even
though there will be similarities between
organisations which are in the same sector, its
history, labour force location, management, etc. will
be unique. So when we study an organisation, we
have to be aware that we need to look at its
differences as well as its similarities with other
organisations.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The Classical approach
Examining these approaches in a bit more detail we can see
that the classical approach concerned itself with three
things:
1. Productive efficiency – by organising workers and job
tasks to create the most productive environment
2. Theories on the job of management, trying to find a set
of general principles applicable to all managers in all
contexts.
3. The best way to design an effective organisational
structure to facilitate the aims of the organisation
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The classical approach
Productive efficiency
• Adam Smith –. In the 18th century Smith
identified the notion of division of labour. This
means that if you organise work so that each
worker carries out small, simple tasks in a
predetermined order, then you will increase
productivity many times over. Work design,
work planning and division of labour are key
OB concepts.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The classical approach
Productive efficiency
Scientific management was developed in the
early 20th century. Many people were trying to
exploit the productive gains from division of
labour by using mechanised technologies.
Perhaps the best known in F W Taylor in the US.
He developed the notion of scientific
management.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The classical approach
Productive efficiency
Taylor claimed that there was a ‘science’ for
every job. He developed a number of key
principles:
• It is the job of managers to analyse jobs and determine the most effective
sequence of events to achieve a satisfactory outcome
• Each task should be simple enough to learn quickly and carry out
effectively using the method identified by managers.
• Workers should be chosen according to their ability to carry out the
designated task
• They should be paid according to their output
• There was to be strict demarcation between the role of manager and the
role of worker
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The classical approach: Theories on management
One of the earliest people to develop ideas on this was Frenchman Henri
Fayol (although his work was not translated into English until the late 1940s).
Fayol suggested that management had five elements:
1.
2.
3.
4.
5.
Planning – deciding what tasks have to be carried out, by when and to
what standard
Organising – arranging and co-ordinating human beings, material and
financial resources to carry out the planned tasks
Command – giving direction to the workers by applying and delegating
power and authority
Co-ordination – ensuring that all activities contribute to the effective
achievement of all tasks
Control – developing systems which monitor progress and ensure
successful completion of tasks
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The classical approach: Theories on management
In addition, Fayol also developed 14 principles of management:
1.
2.
3.
4.
5.
6.
7.
Division of work – to optimise productivity
Authority – the leadership of the organisation delegates power and
authority to different levels of management in the organisation
Discipline – expectations of performance and behaviour should be clear
and adhered to by everyone
Unity of command – each employee should have only one direct
supervisor to whom they report
Unity of direction – Management should be consistent and in agreement
about ends and means
Subordination of individual interests to the general interest – this
includes managers as well as workers
Remuneration – should be fair and reflect the skill and effort of the
worker
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The classical approach: Theories on management
In addition, Fayol also developed 14 principles of management: (continued)
8. Centralisation – Important decision-making is made at the centre rather
than locally
9. Scalar chain – the number of levels in the hierarchy of the organisation
10. Consistency of process and access to resources so everyone knows where
they stand
11. Equity – employees should be treated consistently and fairly
12. Stability of tenure of personnel – staffing levels should fluctuate as little
as possible as long as the work can be effectively carried out
13. Initiative – the staff should have the ability to make decisions regarding
their day to day working
14. Esprit de corps – Management needs to create feelings of belonging and
shared purpose
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The classical approach: Structuring the
organisation
The German sociologist and philosopher Max Weber looked for organisations
that were designed and managed rationally.
He saw the increasing rationality in the running of contemporary states and
believed this needed to be translated into the running of businesses and
other organisations too.
His view of the bureaucratic organisation was that it represented a more
reasoned and effective use of power and authority.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The classical approach:
Structuring the organisation
Main characteristics of a bureaucracy are:
• Clearly delineated roles and responsibilities
• Job specialisation
• Centralised decision-making
• Clear levels of authority
• Rationalised and transparent pay and conditions
• Open selection of staff
• Selection and promotion by ability
• Work and conduct prescribed by rules and regulations
• Clear line management responsibilities
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The human relations approach
• Developed in the first half of the twentieth century as a
reaction to scientific management
• Obvious that work organised according to scientific
management principles was boring and alienating for the
workers
• What we usually regard as the seminal study which led us to
consider the human relations aspect of work are the
Hawthorne Studies (which ironically began as a study in
scientific management).
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The human relations approach
The Hawthorne Studies
• Began as a study to find the optimum working conditions to maximise
output
• Researchers were surprised to find that, generally, whatever changes
were made to working conditions, output rose
• This led them to try to understand the psychological processes behind this
• This has come to be known as the ‘Hawthortne Effect’ in which workers
perform better if they believe that management are interested in their
workers’ contribution and responses to their work environment
• Researchers have since been attempting to look at work from the
perspective of the psychological, social and emotional needs of the worker
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The human relations approach
Those who want to explore this approach have tended to focus on:
• The psychological and social needs of workers and the degree to which
work can satisfy these needs
• Organisations in which there is a tension between the formal and informal
social system, where the latter gives opportunities for friendship, selfexpression, a sense of belonging, status and personal development
• Organisations are designed rationally, bur human beings are also
emotional beings with strong sense od morality and values. This can often
put the means and ends of the organisation’ management at odds with its
workforce.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The human relations approach
The human relations approach is based on two general
principles:
1. The assumption that people are more productive if work
meets their social and psychological needs
2. People, rather than technology, should be at the heart of
work design
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The systems approach
The Classical and Human Relations approaches were
both trying to find the the most effective way to run
work organisations.
The systems approach in contrast is concerned with
examining the organisation in its wider context.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The systems approach
• In the study of OB, the term system has a more precise
meaning than it has in general conversation.
• A system is something that takes inputs from its immediate
environment, transforms those inputs into something else
and then outputs those transformations back into the
environment.
• Precisely what those inputs, transformations and outputs are
will vary from organisation to organisation.
• A system like this is called an open system.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The systems approach
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The systems approach
A systems approach helps organisations:
• Monitor their activities
• Spot potential threats or opportunities from outside
• Evaluate the success or otherwise of their activities
• Identify and solve problems
• Analyse the component parts of the organisation as
an interconnecting set of sub-systems with their own
inputs, transformations and outputs
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The systems approach
Problem solving from a systems perspective:
This has a set of logical steps:
1. Identify the problem
2. Identify the cause(s)
3. Select a solution
4. Manage the solution to effective implementation
On the face of it this looks like a useful problem-solving model. However at
each stage there may be differences of opinion about what the problem is,
what the cause is or how to remedy the problem.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The systems approach
Complex systems – we soon find that the open system model
is not sophisticated enough. People see things from differing
perspectives and in the light of different interests.
A complex system recognises that organisations are made up of
many different systems, with their own goals, relationships,
interests and norms. All of these interact all the time with other
systems at all levels of the organisation.
These myriad, small interactions give a system its dynamism and
its variability.
The downside is that it is difficult to agree on cause, effect and
resolution
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
The systems approach
Complex systems – have certain properties:
1.
2.
3.
4.
Emergence – all the systemic interactions will lead to the emergence of
various forms of structure and norms of behaviour in addition to (even in
spite of) the formally designed ones
Self-organisation – all the many interactions will eventually lead to a
form of organisation emerging in the overall system
Adaptability – complex systems adapt quickly to changes in the
environment at the micro level. The aggregate of thee changes
eventually leads to changes in the relationship of elements of the system
at all levels. Over time this will be observed to have changes the whole
system.
Homeostasis – this means balance, or equilibrium. Too much change can
lead to the destabilisation of the system, where no part of it can function
properly. So all parts of a system need to find stability in order to
function.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
Contingency
In OB we use the term contingency to mean those things in an
organisation’s environment which influence its members to act in a
particular way. These contingencies can be either internal or external
to the organisation, hence contingency theories are a kind of systems
approach.
Woodward tried to identify the main variables which impacted on the
structure and management of organisations. She identified 3 types of
industrial organisation:
1. Unit based for small scale production
2. Mass based for large scale production
3. Continuous process for things like gas, electricity, etc.
These technologies influenced the structures of organisations.
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)
Contingency
The structural features she identified were:
• The number of management levels
• The supervisory span of control (i.e. how many people a
manager had reporting to him/her)
• The ratio of managers to total workforce
• The skills needed for the technology involved
• Whether the structure was mechanistic (i.e. its actions are
determined by and prescribed by rules and regulations – like a
machine) or organismic – or organic (i.e. the organisation
responds to external stimuli and tries to adapt to
accommodate new situations).
© Mike Maughan, Organisational
Behaviour, Palgrave (2014)