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ORGANIZATIONAL BEHAVIOR
INTRODUCTION
Three features should be emphasized Study of human behavior
 About behavior in organizations (org)
 Useful in improving an organization’s effectiveness
Definition- “OB is directly concerned with the understanding, prediction & control of human
behavior in orgs.”
By Fred Luthans
The managers (mgr) ability to understand, appreciate & manage people in orgs. They also provide
unique opportunities to enhance personal n organizational effectiveness
Scope of OB
 Intra-personal behavior covers such aspects as personality, attitudes, perception, learning,
opinion, motivation & job satisfaction.
 Inter-personal behavior includes group dynamics, inter-group conflict, leadership,
communication & the like.
 Orgs, the study covers such aspects as their formation, structures & formal n informal orgs.
Why study OB
1.
2.
3.
4.
It helps an individual 2 understand himself n others better
Managers can motivate his subordinates to work 4 better results
Useful 2 maintain cordial industrial relations.
Understand the cause of problem, predict its course of action in control its
consequences.
5. Useful 4 marketing flow of goods n services 4m producers 2 consumers.
6. Predict behavior n apply to make org more effective.
Approaches to the study of OB
1. Human Resource (HR) Approach- people r the central resource in any org. n developed
towards higher competency, creativity n fulfillment.
2. Contingency Approach- or situational approach, methods (methods) or behaviors which
works effectively in 1 situation
3. Productivity Approach- ratio of output 2 input, organization’s effectiveness, optimizing
resources utilization.
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4. Systems Approach-view org as united, purposeful, gives mgrs a way of looking org as a
whole.
Organizational Behavior Model
Personality
Perception
Learning
Attitudes
Motivation
Group dynamics
Leadership
Power n politics
Communication
Conflict
Organizational
culture
Work stress
Organizational
change n
development
Individual
Behavior
Group
behavior
Organizational
effectiveness
Organization
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Personality
It may be understood as the characteristic patterns of behavior and modes of thinking that determine a
person’s adjustment to the environment.
Theories of Personality
1. Type Theory
One basis for classifying personality is body build by Kretschmer & Sheldon
Endomorph- plumbs person- sociable, relaxed, & even tempered, comfort, love fine food, jovial,
affectionate.
Ectomorph- tall, thin person- restrained self conscious & fond of solitude, absent minded, shy but
brilliant.
Mesomorph- strong, athletic- noisy, callous, highly aggressive, self-confident
Second basis to type personalities is psychological factors by Carl Jung
Introverts- greater sensitivity and concern for feeling and are more comfortable dealing with abstract
things, they are less sociable & absorbed in inner life. Avoid social contacts rarely speaks to others.
Extroverts- more oriented towards other people, events & objects crave excitement and dislike
solitude
Mixture of these two determines the kind of overall personality on an individual.
2. Trait Theory
In this theory we could rate an individual on a scale of intelligence, emotional stability, and
aggressiveness.
Psychologists working the basic Trait Theory are concerned with
1. Determining the basic traits that provide a meaningful description of personality.
2. Finding some way to measure them.
Factor Analysis- a complex statistical technique, it helps to reduce a large no. of measures to a
smaller no. of independent dimensions
Two ways of assessing Personality Traits
1. The person describes himself by answering about his attitudes, feelings & behavior.
2. Someone else evaluates the person’s trait from what he knows about the individual. Two mtds
of personality rating inventory & rating scale.
3. Psychoanalytic Theory
It is based in in-depth study of individual personalities. Created by Sigmund Fred.
Free Association method requires that the person talks about everything that comes into conscious
mind. By analyzing free association Fred sought to puzzle out basic determinants of personality.
Structure Model- personality composed of 3 structures- id, ego & superego
Id- is the mental agency containing everything inherited.
Ego- mental image do not satisfy needs, reality must be considered. Ego develops out of id.
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Superego- it judges whether an action is right or wrong according to the standards of the society.
4. Social Learning Theory
Through learning one acquires knowledge, language, attitudes, values, manual skills, fears
personality traits & self insight.
2 ways of learning- learning through reinforcement (direct experience) & learn by observing others
watching the behavior of other people, draw conclusion from it.
Perception
It is a process through which the information from outside environment is received, selected,
organized & interpreted to make it meaningful.
“Perception is the process of becoming aware of situations of adding meaningful associations to
sensations”
Perception Process
1. Process of Receiving Stimuli- sensory organs (vision, smell, hearing, touch & tasting)
receives not only physical objects; they receive events or objects that have been repressed.
2. Process of Selecting StimuliExternal Factors Influencing Selection
a) Nature- whether the object is visual or auditory & whether it involves picture, people
or animal
b) Location- the best location of the visual stimulus for attracting attention is directly in
the front of eyes in the centre of a page.
c) Intensity- stimuli of higher intensity are perceived more than the object with low
intensity. For example, loud noise, strong odour.
d) Size- larger size attract more attention than the smaller ones
e) Contrast- the background what people are expecting will receive their attention.
f) Movement- moving object receives more attention
g) Repetition- repeated stimuli is more attention drawing than single one.
h) Novelty & familiarity- novel & familiar situation can serve as an attention greater
Internal Factors
a) Learning- creates expectancy in people and expectancy makes him to see what he wants to
see.
b) Psychological Needs- unreal things often look real because of deprived needs
c) Age Difference- the generation gap contributes to different perception
d) Interest- perception is influenced by the interest of the perceiver
e) Ambivalence- mixed feeling about situation
3. The Organizing Process- the stimuli received must be organized so as to assign some
meaning to them
4. The Process of Interpreting- the perceiver interprets or assigns meaning to the information
5. The Process of Checking- perceiver tends to check whether his interpretation is right or
wrong
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6. The Process of Reacting- the perceiver shall indulge in some action in relation to his
perception. The action is positive when the perception is favorable & vice-versa.
Factors Influencing Perception
1. Characteristics of Perceiver- the person needs past experience needs, habits, personality,
values, attitudes may all influence the perception process
2. Characteristics of the Perceived- the physical attributes, appearance, & behavior of other
person in the situation also influence how that situation is perceived.
3. Characteristics of the Situation- the physical, social & organizational settings of the
situation or events in question can also influence perceptions
Managing Perception Process
1. Have a high level of self awareness
2. Seek information from various sources to conform or disconfirm personal impressions of a
decision situation
3. Be able to see a situation as it is perceived by other people
4. Influence Perception of other people when they are drawing incorrect or incomplete
impressions of events in the work settings
5. Avoid common perceptual distortion that bias our views of people and situations
6. Avoid inappropriate attributions
Learning
It is a relatively permanent change in behavior that occurs as a result of prior experience
Learning is reflected in behavior. The change in behavior should occur as a result of experience
practice & training.
Theories of Learning
Classical Conditioning- by I.P. Pavlov established a Stimulus-Response (S-R) connection. It
introduces a simple cause & effect relationship b/n one stimulus & one response.
Operant Conditioning- by B.F. Skinner, it induces a voluntary change in behavior and learning
occurs as a consequence of such change. Behavior is repeated if the consequences are favourable &
vice versa
Cognitive Learning- it refers to the individual’s thoughts, knowledge, interpretations, understanding,
or ideas about himself and his environment. It was done by Tolman.
Social Learning- ability of an individual to learn by observing models- parents, teachers, peers,
motion, pictures, TV artists, bosses & others.
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MOTIVATION
“Motivation means a process of stimulating people in action to accomplish desired goals.”
By Scott
Nature of motivation








Unending process
Psychological concept (generated with in an individual
It is a behavioral concept
Cannot be partially motivated-self certained n inseparable unit
Cannot be either positive or negative
Complex process
System oriented
Drive n effort to satisfy a want or goal.
Importance









Willingness on the part of workers to do the work in a better way.
Improves the efficiency of operation
Proper utilization of HR
Leads 2 job satisfaction
Helps 2 solve labors problems
Cooperation 2 get best results
Reduce resistance 2 change
Try 2 be efficient as possible
Closer relationship b/n enterprise n workers.
Types of motivation
1. Positive Motivation- proper recognition of employees’ efforts n appreciation
of employees contribution 2wards goal achievement.
2. Negative Motivation- based on force, fear, threats, fear of punishment,
threatened with demotion, dismissal, lay-off, pay cut etc
3. Extrinsic Motivation- external factors, financial in nature like higher pay,
retirement benefits, profit sharing, health n medical insurance etc.
4. Intrinsic Motivation- performance of work, provide satisfaction, praise,
status, participation, esteem, power.
Theories of Motivation
Maslow Need Hierarchy theory
American psychologist Dr. Abraham H. Maslow.
Salient Features
Human likings r innumerable n never ending
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No single motive determine behavior
Lower level need must atleast partly be satisfied b4 higher level needs emerge
Only unsatisfied wants induce the man 2 work hard
All levels needs r inter-dependent n over-lapping
People seek growth
Self
actuali
Esteem needs
Social needs
Safety needs
Physiological needs
1. Physiological Needs- it includes needs 4 food, clothing n shelter
2. Safety Needs- protection 4 physiological dangers (fire accidents), economic security ( health,
insurance),desire 4 an orderly, predictable environment.
3. Social Needs- need 4 love, friendship, and exchange of feelings, grievances, conversation,
and companionship.
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4. Esteem Needs- self confidence, achievement, competence, self respect.
5. Self Actualization Needs- desire 2 become everything tat one is capable of becoming
Critical appraisal of Maslow Theory







May not apply at all times, place n circumstances
Some people do not need social needs
Theory may not have universal validity
Behavior of a man is not a result of his needs only
Single need cannot motivate any individual
People differ in their expectation significantly
No evidence tat once a need is satisfied it looses its motivating force.
Herzberg’s Theory- Hygiene Approach
Late 1950’s, Frederick Herzberg,
A person’s relation to his work is basic one n that his attitude 2wards work would determine his org
related behavior.
It seems that people who r satisfied with their job will be more dedicated 2 their job n perform
it well.
Two Factors taken into consideration
1. Hygiene Factors- maintains a reasonable level of satisfaction among employees.
Some hygiene factors
o Company policy n administration (admin)
o Technical supervision
o Interpersonal relation with subordinates
o Salary
o Job security
o Personal life
o Working condition
o Status
o Interpersonal relation with superiors
o Interpersonal relation with peers
2. Motivational Factors- satisfaction 2 the worker at the time of presence
Some motivational factors
o Achievement
o Recognition
o Advancement
o Opportunity 4 growth
o Responsibility
o Work itself
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Critical Appraisal of Herzberg Theory





It has no universal application
2 factors theory of motivation- satisfiers n dissatisfier 2 different qualitative factors
The theory limits its applicability 4 general use
The distinction b/n motivation factors n hygiene factors is not fixed
Too much attention on satisfaction rather than the performance level
Difference between Maslow & Herrzberg’s Theory
Issue
1. type of theory
2. work level
Maslow
Descriptive
Relevant 4 all workers
3. view of
motivation
4. effect of needs
5. effect of pay
6. need of order
Macro view-deals with all aspects of
existence
All needs r motivated at various times
Pay is a motivator if it satisfies needs
Hierarchy needs
Herzberg
Prescriptive
Probably more relevant 4 white
collar n professional workers
Micro view-deals primarily with
work related motivation
Only some needs r motivated
Pay is not a motivator
No hierarchy
Vroom’s Expectancy Theory
Victor Vroom. It represents a comprehensive valid n useful approach to understand motivation. It is
based on self interest.
I. Valance- it refers to the importance or personal value that an individual places on the rewards
that can be achieved on the job,
for example (example) one can be motivated 2 work hard
not 4 pay raise but to get status or job security.
II. Expectancy- it implies that the extension which a person believes that his effort will lead 2
high performance. For example worker will be motivated that his performance will lead to
increase productivity so it will result 4 better pay off
III. Instrumentality- relationship b/n performance n reward. If higher performance with higher
reward than the instrumentality is positive. N vice-versa.
Motivational Force=Valance X Expectancy X Instrumentality
Critical Appraisal of Vroom’s Theory
 Has not fully tested empirically
 Overly rational as it is based on a rational economic view of people
 The predictive accuracy of the theory is doubtful
 Difficult to research n apply in practice
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McGregor’s Theory X and Theory Y
Douglas McGregor.
Theory-X emphasizes managerial action. It is autocratic
Assumptions
 Management (mgt) is responsible 4 organizing elements of production- men, material, money
etc.
 Mgt should direct n motivate people n control their action
 In the absence of intervention of mgt people will be inactive n idle
 The av. Individual has dislike 4 doing work n try 2 avoid it
 Individual prefers 2 be guided by others
 People by nature resist change.
Theory-Y is decentralization of authority n creating opportunities 4 workers 2 do their best.
Assumption
 Work is not a burden or load, but it is a play
 Individual readily takes to work
 Autocratic methods of mgt will lead to unproductive results
 Av. Individual readily take responsibility if there is incentive
 Intellectual capabilities of workers are not fully utilized by mgt
LEADERSHIP
Leadership is the process of encouraging n helping others to work enthusiastically towards
objectives.
Keith Davis & J. W. Newstrom
L= F (f,g,w,s)
Where leadership (L) is the Function (F) of
f= followers
g= goals
w= a measure of willingness on the part of subordinates
s= a given situation
Leadership Characteristics
A leader has some inherent qualities n traits which assist him in playing a directing role.
1. energy drive
2. appearance, presentability
3. a sense of cooperativeness
4. enthusiasm
5. personality- height n weight
6. initiative
7. intelligence
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8. judgment
9. self confidence
10. sociability
11. tact n diplomacy
12. moral courage n integrity
13. will power n flexibility
14. emotional stability
15. Knowledge of human relations.
Formal and Informal Leadership
A formal leadership occurs when a person is appointed or elected as an authority figure.
The informal leadership emerges when a person uses interpersonal influence in a group without
designated authority or power.
Difference between Leaders and Managers
Sl.No.
1
2
3
Leaders
It has followers
Follower wont obey their leader
Leader has emotional appeal
4
5
6
7
8
9
10
11
12
13
Leader fulfill followers need
Leaders r doing right things
Innovates
Is an original
Develops
Focus on people
Inspires trust
Has long range perspective
Asks what n why
Originates
Managers
It has subordinates
Subordinates may obey their mgrs
Mgrs r expected 2 b rational decision
maker n problem solver
Main aim of mgr is to meet org.al goal
Mgrs r doing things right
Administers
It is a copy
Maintains
Focus on system n structure
Relies on control
Has short range perspective
Ask how n when
Initiates
Leadership Styles
I. Style based on Authority Retained
1. Authoritarian Style-autocratic style leader decides, decision is passed on to
subordinates & the subordinate’s r expected to do what the leader has told them to
do.
2. Participative style-there r 3 related types of participative style
a) Consultative- leader solicit opinion from group before making a
decision.
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b) Consensual- leader encourages group discussion on an issue n than make
a decision tat reflects the general agreement of the group members.
c) Democratic- leader confer final authority on the group. They take vote
b4 making a decision.
3. Free-rein Style- complete freedom is given to the subordinates so tat they plan,
motivate, control & otherwise be responsible 4 their own actions.
II. Style based on Task
People emphasis
high
High Relationship
low
High task
Low task
High Relationship
(Supportive Style)
(Participative Style)
Low Task
High Task
Low relationship
Low relationship
(Free-rein Style)
(Autocratic Style)
Low
high
Task emphasis
High task n low relationship- this style may b effective where the employees r un experienced
High task n high relationship-the leader spend considerable time showing people how to get the
work accomplished
Low task n high relationship-leader gives employees much encouragement n support but a min. of
guidance.
Low task n low relationship-leader is neither here nor there, like free-rein.
Theories of Leadership
Trait Theory
Leaders pocesses a set a traits which make them distinct from followers.
Successful leaders has following qualities
1. a strong desire 4 accomplishment
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2.
3.
4.
5.
6.
7.
achieve the goals
creativity n intelligence used 4 problem solving
initiative applied 2 social situations
self assumed personality
high tolerance
ability 2 influence others
Evaluation of trait theory
It is criticized by many
 personality trait of successful leaders is too long
 this theory says leaders is born not trained but this is not accepted by contemporary thinkers
 how much of which trait a successful leader must have is not clear
 it is wrong tat a effective leaders depends only on the personality, there r other variables like
his task, characteristics of followers
 Some people who fails as leaders has possess some of the traits as successful leaders.
Behavioral Theories
It studies how a leader behaves n the followers performs well and have job satisfaction
It was started after World War II.
It can be summarized as follows
1. consideration was positively related 2 low absenteeism but was negatively related 2
performance
2. initiating structure was positively related to performance but was negatively consequence as
absenteeism
3. when both consideration n structure were is high, performance n satisfaction tended to be high
Criticism of theory
 it could mot successfully identify a consistent relationship b/n leadership behavior n
group performance.
 General statement could not be made because results would vary over different range
of circumstances
Contingency Theory or Situational Approach
No leadership style is the best for all times & in all situations. Situation helps the people to develop
their leadership qualities n emerge as leaders. The extent to which the leader has control over the
situations.
The effectiveness of a leader depends upon –
1. his motivational style
2. the favorableness of the situation
Demerits
1. the meaning of some variables is not clear
2. Lack a theoretical orientation.
3. no attention is given to the actual technical competence of the leader or subordinates
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Communication
Communication is the transmission, facts, feelings & ideas b/n 2 or more people.
The person who sends the message is the sender or communicator and who receives it is the receiver
or communicatee.
Need for communication
1. to establish n spread goals of an org widely
2. to develop plans for future achievement
3. to organize human n resource in most efficient n effective way
4. to select n appraise members of the org
5. to lead, direct, motivate n create good working environment
6. to control n maintain uniform performance
Process of communication
1. Sender- person who starts the communication process 4 passing information to others
2. Communicating channels- medium through which the encoding information is passed from
sender to receiver. For example Fax, e-mail, etc
3. Symbols- the basis for transfer of information it may be in the form of words, sketch,
diagrams etc
4. Receiver- person who receives the final information n understand it
5. Noise & feed back communication- checking the information whether it is correctly reached
or not
METHODS OF COMMUNICATION
Written, oral and non-verbal forms of communication
An organization mainly uses oral communication for day today activities.
Advantages
 Doubt is clarified immediately
 Feedback is known
 Provide team spirit
 Quick n effective method
Disadvantages
 No permanent record
 Likely to be forgotten
 Likely to be misunderstood n noisy
 Not suitable 4 lengthy messages
Written communication refers to personal letters, memoranda, policy, procedure, manuals, notices,
appointment orders, purchase orders and associated communications etc.
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Advantages
o Permanent record
o Very suitable 4 lengthy messages
o Tangible n verifiable
o Can be send 2 far of places
Disadvantages
o Slow process
o Feedback is not immediately known
o Doubt cannot be clarified
o Skill n education is needed 4 understanding
Formal Communication
Flow through prefer channel
Informal Communication or grapevine
Talk together informally. 2 persons talking about the happenings in the org it may be work related or
people related. Like rumors.
FORMAL COMMUNICATION NETWORK
Chain
Wheel
Circular
Free flow
Inverted V
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Single chain: Here the flow is from superior to the immediate subordinate down wards through
each successive level and similarly upwards.
Wheel: Here the superior is the hub and all subordinates communicate through him only.
Circular: Here each person communicates with his adjoining two persons and the flow is circular
and slow.
Free flow; Here each person communicates with all the others freely but lacks coordination.
Task force is an example.
Inverted V: Here the subordinate can communicate with his superior and superior’s superior.
This makes flow faster more effectively.
Communication Flow in the Organization
Downward Communication- information is send from the higher levels to the lower levels i.e. from
superior to subordinates
Top Mgt
Mgr 1
S1
11
S2
Mgr 2
S3
S1
S2
Mgr 3
S3
S1
S2
S3
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Upward Communication- Flow from subordinates to superior
Top Mgt
Mgr 1
S1
S2
Mgr 2
S3
S1
S2
Mgr 3
S3
S1
S2
S3
Horizontal or Lateral Communication- information passed b/n same level of org
Top Mgt
Mgr 1
Mgt 2
Mgr 3
Barrier to Effective Communication- some problems may arise in its encoding n decoding or
communication channel.
1. Physical Barriers- these barriers r environment factors, it includes physical distance,
distracting noises n other interferences.
2. Personal or Socio-psychological Barriers- arises from motives, attitudes, judgment n
emotions. Messages r subjected 2 several mental n social barriers
3. Organizational Barriers- information flows through hierarchical structure in org downward
communication, chances of information being filtered.
4. Semantic Barriers- relationship of signs to their reference. Arises due to limitations of the
symbolic system
5. Mechanical Barriers- inadequate arrangement for transmission of new, facts n figure, poor
office layout.
EFFECTIVE COMMUNICATION

Use simple language without any ambiguity

Encourage face to face communication

Listen first and understand before responding
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
Exchange of information should be in a peaceful atmosphere

Redesign the organizational structure for reduction in filtering of messages

Ensure that feedback is received for corrective action.
Group
A collection of 2 or more interacting individual with a stable pattern of relationships b/n them, who
shares common goals, n perceives themselves as being a group
Types of Groups
1. Formal Groups- deliberately created 2 perform a specific task
2. Informal Groups- natural formation in the work environment appear in response the need for
social contact
Types of informal group
1. Interest group- they come for the purpose of achieving some common goals
2. Friendship group- based on age, similar views or similar interest
3. Membership group- person consciously belong but which he has no more than minimal
relationship. For example. All students n teachers belongs 2 a college
4. Reference group- 1 may belong n allow oneself 2 be influenced by its members behavior.
For example. Jain Samaj, Student Unions
Why do people join Group?
 Security- group reduce insecurity
 Esteem- increase his self esteem through group membership
 Affiliation- people enjoy the regular company of others
 Power- members enjoy greater power collectively
 Identity- group contributes to the individual’s external quest 4 an answer 2 the
question
 Huddling- they like group mass
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 Functions (fn) of groups- fulfills wide range of fns both 4 their members n 4 the
larger org.
Group Cohesiveness
The attractiveness which a group holds 4 its members i.e. each group involves participation by
members through loyalty n solidarity.
Cohesiveness- the resultant power of a group to think n act as a single unit in pursuit of a common
objectives. The extend of liking each member has 2wards others n how far everyone wants 2 remain
as a member of the group.
Factors determining group cohesiveness
1. Broad agreement concerning the goals n objectives
2. The size of the group is sufficient 4 interaction but not too large to stump personal attention
3. Satisfactory level of homogeneity in social status
4. Individual characteristics- cooperativeness, maturity, n being an accepting person tend 2
develop friendliness
5. communication n interaction among participative members
6. capable n effective leader is needed
Group Behavior
Groups are mechanism through which people learn relevant job skills n knowledge.
Determinants of Group Behavior
1. Org Strategy- what business it is in or wants to be in n the kind of org it or want to be
2. Authority Structure- who reports to whom, who makes decisions, n what decisions individuals
n groups r empowered 2 make
3. Formal Regulations- org create rules, procedures, policies n other forms of regulations 2 std
employee behavior
4. Organizational Resources- includes tools, equipments, facilities n work methods n procedures
5. Procurement Of Personnel- the method adopted by the org 2 hire employees will determine
the type of people constitute the group
6. Performance Appraisal n Reward System- group is influenced by this
7. Organizational Culture- standard of acceptable n unacceptable behavior 4 employees
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8. Group Work Settings- physical n spatial arrangement of work settings
Group Member Resources- it comprise of abilities of members n personality characteristics
Group Structure- groups has a structure tat shapes the behaviors of the members n possible 2
predict individual behavior
Group Process- communication pattern used by the members 4 information exchanges.
Group Development
Groups r formed n developed through several forms
Stages
1. Forming- great deal of uncertainty about the groups purpose, structure n leadership
2. Storming- conflict arises because of interpersonal behavior
3. Norming- single leader emerges n this results in group cohesive
4. Performing- marked by team work, role clarity n task accomplishment
5. Adjourning- groups prepares 4 its discharge.
Group Norms
Are asset of beliefs, feelings, and attitudes commonly shared by group members. These are also
referred to as rules or standards of behavior that apply to group members.
Characteristics
 Norms represents characteristics of a group.
 They are related to behaviors considered imp by most group members.
 They are basis for predicting & controlling behavior of group members.
 They are applied to all members though not uniformly
How do Norms Develop?
 It develops because members bring their past experiences from other group in org
 Primacy is another way of forming group norms. Primacy refers the first behavior
pattern that emerges in the group.
 A critical incident in the life of an org often sets a precedent.
 Explicit statement made by supervisor or co-workers themselves may become norms.
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Why Are Norms Strongly Enforced
 Norms is to be strongly enforced if they ensure group success or survival
 The norms reflect the preferences of supervisor or other powerful group
members.
 The norms predict what behavior is expected of them
 Norms is to be strongly enforced if they help the group avoid embarrassing
interpersonal problems.
Decision Making
Decision making is the process of choosing the best from among the alternatives 2 achieve a desired
goal.
Features of Decision Making
1. it is a selection process
2. it is goal oriented process
3. it is a end process
4. it is a human n rational process
5. it is a dynamic process
6. it is situational
7. it is a continuous n on going process
8. implies freedom to the decision maker regarding the final choice
9. it may be positive or negative
Types of decision making
Programmed decision- decision making in routine situation by limiting or excluding alternatives.
Also called as structured decision.
Non programmed decision- deals with unusual or exceptional problems also called as unstructured
decision.
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Decision Making Process
1. Identification of problems- recognition or finding problems that is to be solved
2. Diagnosis and Analysis of the problems- identify the problem 4m its symptoms. The mgr
must obtain all relevant facts n analyze them correctly
3. Search for Alternatives- search 4 several possible alternatives, problems can be solved in
many ways
4. Evaluation of Alternatives- process of measuring the positive n negative consequences of
each alternative.
5. Selecting the Alternatives- select the best alternative.
6. Implementation and fellow-up- once alternative is selected, it is put into action in a
systematic way. After this the decision has 2 be closely monitored.
Group Decision Making
When decision r made in groups
How do Group Make Decision?
1. Decision by lack of Response- when the group finally accepted an idea, all other accepts it
simply due to lack of response.
2. Decision by Authority Rule- the chairperson, mgr or some authority makes a decision 4 the
group.
3. Decision by Minority- 2-3 group members dominates n force the group to make a decision
they agree with.
4. Decision by Majority Rule- by voting or polling members to find majority viewpoint.
5. Decision by Consensus- with the support of most members n even those who oppose it feels
that they have been heard n had a fair chance to influence the decision outcome
6. Decision by Unammity- all members agrees on the cause of the action to be taken.
Advantages of Group Decision Making
 Greater knowledge so that they can brought 2 bear on the prob.
 Greater no. of approaches available to the prob.
 Increase participation by a variety of individuals
 Better understanding of final decision.
Disadvantages of Group Decision Making
 Take more time in decision making
 There is social pressure to conform it.
 A dominant person may emerge n control the group’s decision
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 Make decision that r simply a compromise b/n the various views held by individual members.
Intergroup Relations
A success of the org as a whole depends upon the harmonial relations among all interdependent
groups, even though some inter-group conflict in orgs is inevitable.
Inter-dependence of Group- a dept depends upon other department 4 resources, work or
information n vice-versa
Inter-dependence takes the following primary forms
a) Pooled inter-dependence- various groups within an org do not depend upon each other but
make separate contribution to the total organizational goals
Org
Group A
Group B
b) Sequential inter-dependence- output of one group becomes the input of the other so that one
group must act b4 the other can
Org
Group A
Group B
c) Reciprocal inter-dependence- two way interaction in intergroup relations. Output of 1 group
is the input of the other, n vice versa
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Org
Group A
Group B
d) Team inter-dependence- extension of reciprocal n involves more than 2 groups
Org
Group A
Group B
Group C
Group D
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Organizational Conflict
Conflict can be defined as an expression of hostility negative attitudes, antagonism, aggression,
rivalry and misunderstanding.
Difference b/n Competition and Conflict
Competition – directed towards obtaining a goal. One group does not interfere with the effort of
others.
Conflict- it is directed against other group & action are taken to frustrate other group’s actions
towards goal achievement.
Positive Consequences of conflict
 Helps in analytical thinking
 Conflict b/n different org develops loyalty n unity
 It promotes competition
 Serves as a foundation for organizational development
 Conflict when expressed can clear the air n reduce tension
Types of Conflict
1. Conflict within the individual- it is usually value related a person may have role conflict.
For example. Telephone operator is advised 2 be polite 2 the customers by the boss n may be
complained that she is spending too much time with the customers
2. Inter-personal Conflict- when conflict b/n 2 or more persons
3. Group b/n individuals & the group- the individual may want 2 remain in the group but may
disagree with the group methods.
4. Inter-group conflict- conflict b/n the network of groups, departments (dept), sections or
work teams.
5. Inter-organizational conflict- conflict also occurs b/n orgs which is in some way is
dependent on each other. Conflict b/n buyer org n supplier org.
Causes of conflict
1. Communicational aspect of conflict- poor communication can have a powerful effect in
causing conflict
2. Behavioral aspect of conflict- conflict due to difference in human thoughts, feelings,
emotions, attitudes, values n perception. It may also be due to religion, race, sex etc
3. Structural aspect of conflictSize of the org- larger size more conflict.
Line & Staff Distinction- there may be conflict among line and staff
Participation- if subordinates r not allowed to participate in decision making than
there may be conflict
Role Ambiguity- if role of each individual is not clearly defined than conflict may
arise.
Design of work flow- due to poor design of work flow structure n poor plan of
coordination where the task is interdependent conflict may arise
Scarcity of resources- when resources r shared and it is scarce conflict may arise.
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Management Conflict- preventing conflict
Goal structure- goal should be clearly defined n the role n contribution of each unit
towards the organizational goal must be clearly identified.
Reward System- reward system should be such that it does not create individual
competition or conflict
Trust n Communication- communicate openly
Coordination-coordinated activity reduces conflict
Resolving Behavioral Conflict
Ignoring the conflict
Covering up the conflict by appealing for unity
Compromising- balancing the demand of the conflicting parties
Forcing- power of forcing his own views on the situations
Problem solving
Resolving Structural based Conflict- it can be prevented by redesigning organizational structure &
work flow.
Work Stress
Stress refers to an individual’s reaction to disturbing factor in the environment. Stress is a state of
mind which reflects certain biochemical reactions in the human body n is projected by a sense of
anxiety, tension n depression.
Stress is said to be positive when the situation offers an opportunity for one to gain something.
It is negative when stress is associated with heart disease, alcoholic, drug abuse, marital breakdowns,
and absenteeism n emotional problems.
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Sources of Stress
Work stress
Individual
stressors
Group
stressors
Organizational
stressors
Organizational Stressors1. Task Demand- they include the design of the individuals job, working conditions n the
physical work layout. Working in an overcrowded room or in a visible location where
interruption is constant stress may arise. Job security is another task demand that can cause
stress
2. Role Demand- it includes the following
 Role conflict- individuals receives competing in conflicting expectations 4m others
 Role ambiguity- results 4m having unclear expectation.
 Role erosion- when the fn of once duty is performed by someone else
 Role overload- when there is too many expectations than one is able 2 fulfill
3. Interpersonal Demand- conflicting personality n behavior may cause stress. It arises when 2
or more people work together n their personality, attitudes, behavior differs.
4. Organizational Structure- excessive rules n lack of participation in decision making affect
an employee and arises stress
5. Organizational Leadership- unrealistic pressures 2 perform in the short run, tight controls, n
routinely fire employee who fails to measure up
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6. Organizational Life Cycle- the early stages of a new org are exciting, n the end stage create
anxiety n tension
Group Stressors
1. Lack of Group Cohesiveness- if an employee is denied the opportunity because of the task
design, because the supervisor does things to prohibit or limit it, or because other group shut
the person out, this can be very stress producing.
2. Lack of Social Support- if sharing their problems n joy with others, is lacking for an
individual, it can very stressful
3. Interpersonal n Intergroup Conflict
Individual Stressors
Among individual factors contributing to stress are personality, life n career changes and life trauma.
PersonalityType A- bring stress on themselves
 Always moves, walks n eats rapidly
 Feels impatient with the pace of things, hurries others, and dislikes waiting.
 Does several things at once
 Feels guilty when relaxing
 Try to schedule more n more work n keep less n less time
 Does not have time to enjoy life.
 Uses nervous gesture such as banging hand on table.
Type B- is less stress prone
 Is not concerned about time
 Is patient
 Does not boast
 Play to fun, not 2 win
 Relaxes without guilty
 Has no pressing deadlines
 Is mild-mannered
 Is never in hurry
Life Change- sudden changes r highly stressful
Life Trauma- individual’s life that alters his or her attitudes emotions or behaviors
Career Change- under promotion or over promotion can also be very stressful, new responsibility
can also be very stressful
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Power and Politics
Power
The ability to influence other people and events. Power refers to the capacity to influence others.
Bases of power- power is derived 4m 5 sources
1. Reward Power- leaders ability n resources to reward others. It is the easiest n enjoyable
power base 4 both leaders n subordinates.
2. Coercive Power- the capacity of the leader to inflict punishment or avert consequences on the
other person. Most difficult n unpleasant power to administer.
3. Legitimate Power- it is the organizational power assigned to the leader to influence others.
For example. A manager position in the org gives him the power over his subordinates in his
specific area of responsibility.
4. Referent Power- the attractive qualities of the leader which makes followers desire to follow
the leader.
5. Expert Power- it is a personal power, is the ability to control other person’s behavior through
the procession of knowledge. For example. A subordinate will obey the superior simply
because superior knows what is to be done.
Achievement of Power
1. Doing the right things
2. Extraordinary Activities- individual need to perform unusual n unroutine work that
commonly involve an element of risk
3. Visible Activities- it must be visible to others in the org
4. Relevant activities- it need to be seen relevant to the mission of the org. n should be the
solution to the organizational problems
5. Cultivating the right people- the interpersonal relationship should be properly managed
6. Superiors- superiors should show special interest n willingness to support subordinates
7. Peers- should have a favorable relationship with peers
8. Combining- individual’s n groups frequently combine their resources to pursue common
goals n objectives.
9. Appointing- absorbing or accomplishing people or group whose support is needed.
Politics
It relates to the way people gain and use power in org.
Functions of Organizational Politics
1. Overcome Personal Inadequacies- organizational politics provides a mechanism 4 avoiding
those inadequacies n getting the job done.
2. Cope with change- organizational politics can help to identify environmental or
technological changing problems n more ambitious, problem solving mgrs into the crisis.
3. Channel Personal Contacts- in longer orgs, it is well high impossible to know the persons in
every imp position. The political network can provide the necessary access.
4. Substitute for Formal Authority- when person’s formal authority breaks down or fails to
apply, political actions can be used to prevent a loss of influence.
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Organizational Structure
It involves arrangement of activities n assignment of personnel to these activities in order to achieve
the organizational goal.
Steps of Organizational Structure
1. Determination, identification and details of activities- the activities required to achieve
these objectives are identified.
2. Grouping and assigning of activities- all similar activities are grouped together and assigned
on the basis of divisions and depts.
3. Delegation of Authority- authority and responsibilities is assigned to all the individuals
Benefits of a good Organization
 A good org facilitates attainment of objectives through proper coordination of all
activities
 The conflict b/n individuals over control are kept to a minimum
 It eliminates overlapping and duplication of work
 It decreases likelihood of “run-around” (run-around- we don’t know who is
responsible 4 what)
 It facilitates promotions
 It aids in wage and salary administration
 Communication is easier at all levels of organizational hierarchy
 Well-structured org provides a sound basis 4 effective planning
 It results in increased cooperation and sense of pride among members of the org
 It encourages creativity.
Types of Organizational Structure
1. Line Organization- it is the simplest form of org n most common under small companies. It
flows in the direct line from the top of the managerial hierarchy down to different levels of
mgrs n subordinates n further down to operative level of workers
President
Vice President
Plant Mgr
Foreman A
Workers
Foreman B
Workers
Foreman C
Workers
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2. Line & Staff Organization- Line units are involved in operations that are directly related to
the core activities of the org. example production dept
Staff units are generally in an advisory capacity and support the line fn. Example. Public
Relation, R & D
President
Legal Council
(staff)
Public Relation
Advisor (staff)
Vice President
(Line)
Personnel
(staff)
Engineering
(staff)
Plant Mgr
(Line)
Supervisor M/c
Shop (line)
Supervisor
Assembly (line)
Workers
workers
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3. Functional Organization- it is the basis of grouping together jobs that relates to a single
organizational fns or specialized skills such as marketing, finance, production and so on
President
Dean, School of
Education
Dean, School of
Business
Dept. of Business
Admin
Dean, School of
Sciences
Dept. of
Economics
Dept. of
Computers
4. The Divisional Organizationa. Dept by Product
General Mgr
Heavy Engineering
Division
Automobiles
Power product
Division
b. Departmentation by Customers
Vice President
Priority
Customer
Regular
Customer
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c. Departmentation by Area
President
VC
Domestic
Division
VC
Far East
Division
VC
European
Division
VC
South American
Division
VC
Middle East
Division
d. Departmentation by Time
Manager
Supervisor
Day Shift
Supervisor
Evening Shift
Supervisor
Night Shift
5. Project Organization- temporary organizational structure formed from specific project for a
specific period of time and for the goal is achieved, these are dismanttaled
6. Matrix Organization- a combination and interaction of project and functional structures and
is suggested to overcome the problems.
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Organizational Change
When an organizational system is disturbed by some internal or external force, change frequently
occurs. Change as a process, is simply modification of the structure or process of a system. It may
good or bad, the concept is descriptive.
Levels of Change
a) Individual Level Change- it reflects as changes in job assignments, physical move to a
different location, or change in the maturity of a person which occurs overtime.
b) Group Level Change- it can affect work flows, job design, social org influence and status
system and communication patterns
c) Organization Level Change- this level affects both individuals & groups. These are made by
sr. mgt & implemented by only single mgr
Reasons for Change
External causes
 Govt policies
 Change in the economy
 Competition
 Raw Material Cost
 Pressure Groups
 Technology Push
 Scarcity of Labor
Internal causes
 Changes in Leadership
 Implementation of new Technology
 Decline in Profitability
 Changes in Employee Profile
 Union Actions
 Low Morale & Motivation
Resistance to Change
Rational Resistance- when people don’t have proper knowledge or information to evaluate change
Emotional Resistance- involves the psychological problems of fear, anxiety, suspicion, insecurity
and the like.
Reasons why People Resist Change
1. Logical, Rational Factors
 Time required to adjust
 Extra effort to relearn
 Possibility of less desirable conditions
 Economic costs of change
 Questioned technical feasibility of change
2. Psychological, emotional causes
 Fear of the unknown
 Low tolerance of change
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 Dislike of mgt or other agent of change
 Need for security, desire for status quo
 Lack of trust on others
3. Sociological factors, group interests
 Political coalitions
 Opposing group values
 Narrow outlook
 Vested interests
 Group inertia
Implementing Change Successfully
1. Unfreezing the Situation- it makes the individuals or org aware n prepares them
for change
2. Changing or Moving to the new Condition- the members of the org recognizes
the need for change and fully prepared to accept such change
3. Refreezing- changes become permanent. The new behavior is replaced
Methods of Introducing Change
1. Use of Group Forces- the behavior, attitudes, beliefs and values of the individuals
are all firmly grounded in the group to which he belongs
2. Change in Agents- the change agents must change himself, than only he will be
able to reinforce a psychological climate of support 4 change
3. Shared rewards- people must derive benefit out of the change.
4. Cooperation of Unions- change without unions support may not stay for long
5. Concern for Employees- changes need to be introduced only when necessary and
it must be by evolution.
Organizational Development (OD)
OD is a long term, more encompassing change approach meant to move the entire org to higher
levels of functioning while improving greatly the performance & satisfaction of org members.
Objectives
 To build and enhance interpersonal trust, communication, cooperation and support among all
individuals and group
 To encourage all analytical approach to problem solving in team spirit and open manner
 To increase a sense of belongingness to the org
 To assign decision making and problem solving responsibilities to skilled and knowledgeable
persons who are closer to the scene of operations
 To increase personal responsibility for planning, implementing the plans & to be aware for the
consequences
 To help mgrs to manage according to the relevant objectives rather than depending on past
practices.
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Organizational Culture
It is defined as the philosophies, ideologies, values, assumptions, beliefs, expectations, attitudes, and
norms that knit an org together and are shared by its employees.
Characteristics
 Individual Initiative- responsibility, freedom, & interdependence
 Risk tolerance- aggressive, innovative & risk seeking
 Direction- clear objectives & performance expectations
 Integration- encourage to operate in a coordinated manner
 Management support- clear communication, assistance and support to their subordinates
 Controls- rules & regulations
 Identity- members identity
 Reward system- rewards based on employees performance
 Conflict tolerance- air conflict and criticism openly
 Communication pattern- communication restriction to the formal hierarchy of authority
Cultural Dimensions
1. Mechanistic & Organic Culture- Mechanistic Culture exhibits the value of bureaucracy &
feudalism. Organic Culture includes departmental boundaries, formal rules and regulations &
prescribed channel of communications
2. Authoritarian & Participative Culture- Authoritarian Culture power is concentrated on
leaders n obedience to orders n disciplines are stressed. Participative Culture people are more
committed to the decisions that are participative made not imposed on them
3. Subculture & Dominant Culture- Subculture each dept of an org has its own culture.
Dominant Culture it emerges when there is an integration of all the depts. Into a unified whole
4. Strong & Weak Culture- Strong Culture the core values are both intensely held & shared by
its members. Weak Culture the opposite will happen when the culture is weak.
5. National & Organizational Culture
How is Culture Created
1. culture formation around Critical Incidents
2. identification with leaders
How is Culture Sustained
a. Selection- right people for the right job. Candidates are selected on the basis of who
can culturally match the organizational culture
b. Top Management
c. Socialization- the org will help the new employees adapt to its new culture
Changing Organizational Culture
1. Change Reward System- it establishes and reinforce specific cultural behaviors
2. Add new members- adding new members is a powerful strategy to change the culture,
provided new member bring in new culture.
3. Implement Cultural Shock- it is an event that causes an org to seriously examine its culture.
The event could be cut in profits, dismissal of company’s top boss
4. Change in Chief Executive Officer (CEO)
5. Involve members
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Organizational Climate
Organizational climate reflects a person’s perception of the org to which he belongs, it serves major
force in influencing their behavior
Organizational climate can be classified into 2 major categories
Overt Factors- it is quantifiable and visible
 Financial resources
 Goals of org
 Skills & abilities of personnel
 Technological State
 Performance Standards
 Efficiency Measurement
Covert Factors- it is not quantifiable and not visible
 Attitudes
 Feelings
 Values
 Norms
 Interactions
 Supportiveness
 Satisfaction
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