Organizational Behavior

Organizational Behavior Bridging Science and Practice Version 4.0 Talya Bauer and Berrin Erdogan 978-1-4533-3766-0 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Organizational Behavior: Bridging Science and Practice Version 4.0 Talya Bauer and Berrin Erdogan Published by: FlatWorld 292 Newbury Street Suite #282 Boston, MA 02115-2832 © 2021 by Boston Academic Publishing, Inc. d.b.a. FlatWorld All rights reserved. Your use of this work is subject to the License Agreement available at https://catalog.flatworldknowledge.com/legal. No part of this work may be used, modified, or reproduced in any form or by any means except as expressly permitted under the License Agreement. Gen: 202109161642 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Brief Contents About the Authors Acknowledgments Preface Chapter 1 Organizational Behavior at Work Chapter 2 Diversity and Inclusion at Work Chapter 3 Individual Differences and Perception at Work Chapter 4 Attitudes and Behaviors at Work Chapter 5 Theories of Motivation at Work Chapter 6 Designing a Motivating Work Environment Chapter 7 Stress and Emotions at Work Chapter 8 Communication at Work Chapter 9 Groups and Teams at Work Chapter 10 Conflict and Negotiation at Work Chapter 11 Decision Making and Creativity at Work Chapter 12 Leading at Work Chapter 13 Power, Influence, and Politics at Work Chapter 14 Organizational Structure and Change at Work Chapter 15 Organizational Culture at Work Index © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Contents About the Authors 1 Acknowledgments 3 Preface 5 Chapter 1 Organizational Behavior at Work 1.1 The Power of People: The Case of Cayuga Collection 10 1.2 Understanding Organizational Behavior 12 About This Book 12 What Is Organizational Behavior? 13 Why Organizational Behavior Matters 13 Adding to Your OB Toolbox 14 Isn’t OB Just Common Sense? 16 Learning and Retention 18 Learning and Retaining Information 18 Memory 18 Learning Style Preferences 20 Learning Techniques for Students 20 Organizational Behavior Research Methods 22 Research Concepts, Tools, and Approaches 22 1.3 1.4 Measurement Issues in OB 24 Trends Influencing Organizational Behavior 26 Challenges and Opportunities 27 1.6 Employee Engagement in Organizational Change Toward B Corp Status: The Case of Brew Dr. Kombucha and Tea 33 1.7 Conclusion 35 1.8 Exercises 35 1.9 Endnotes 36 1.5 Chapter 2 9 Diversity and Inclusion at Work 39 2.1 Open to All and Color Proud: The Case of Gap Inc. 40 2.2 Demographic Diversity and Inclusion 42 Benefits of Diversity and Inclusion 42 Challenges to Achieving Diversity and Inclusion 45 Specific Diversity Issues 48 Tools for Creating an Inclusive Workplace 55 Cultural Diversity 59 Individualism-Collectivism 61 Power Distance 62 2.3 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 64 Aggressive-Nurturing (Masculinity–Femininity) 64 Strength of Norms: Tightness-Looseness of Culture 65 Suggestions for Managing Cultural Diversity 66 Focus on Diversity, Ethics, Technology, and National Culture 68 Diversity and Ethics 69 Diversity and Technology 70 Diversity Around the Globe 70 2.5 Equality as a Core Value: The Case of Salesforce.com 72 2.6 Conclusion 73 2.7 Exercises 74 2.8 Endnotes 75 2.4 Chapter 3 Uncertainty Avoidance Individual Differences and Perception at Work 3.1 Individuals Bringing Their Full Selves to Work: The Case of Fully 80 3.2 The Interactionist Perspective: The Role of Fit 81 3.3 Individual Differences: Values and Personality 83 Values 83 Personality 85 Personality Testing in Employee Selection 92 Perception 94 Visual Perception 95 Self-Perception 95 Social Perception 96 3.4 Attributions 3.5 Chapter 4 79 98 Focus on Individual Differences, Ethics, Technology, and National Culture 100 Individual Differences and Ethics 100 Individual Differences and Technology 101 Individual Differences Around the Globe 101 3.6 Hiring for Match: The Case of Netflix 103 3.7 Conclusion 105 3.8 Exercises 105 3.9 Endnotes 106 Attitudes and Behaviors at Work 111 4.1 Delivering Happiness: The Case of Zoom Video Communications 112 4.2 Work Attitudes 113 What Causes Positive Work Attitudes? 115 Consequences of Positive Work Attitudes 118 4.3 Assessing Work Attitudes in the Workplace 119 Work Behaviors 120 Job Performance 121 Organizational Citizenship Behaviors 122 Counterproductive Work Behaviors 123 Absenteeism 123 Turnover 125 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Focus on Attitudes and Behaviors, Ethics, Technology, and National Culture 128 Job Attitudes, Behaviors, and Ethics 128 Job Attitudes, Behaviors, and Technology 129 Job Attitudes Around the Globe 129 4.5 People Come First: The Case of SAS 131 4.6 Conclusion 132 4.7 Exercises 133 4.8 Endnotes 134 4.4 Chapter 5 Theories of Motivation at Work 5.1 Motivated Employees: The Case of Patagonia 138 5.2 Understanding Motivation 139 Intrinsic and Extrinsic Motivation 140 Need-Based Theories of Motivation 141 Maslow’s Hierarchy of Needs 142 ERG Theory 143 Two-Factor Theory 144 Acquired-Needs Theory 145 Process-Based Theories 147 Equity Theory 147 Expectancy Theory 151 Reinforcement Theory 154 Focus on Motivation, Ethics, Technology, and National Culture 159 Motivation and Ethics 159 Motivation and Technology 160 Motivation Around the Globe 160 5.6 Creating Happiness via Motivation: The Case of The Walt Disney Company 161 5.7 Conclusion 163 5.8 Exercises 163 5.9 Endnotes 165 5.3 5.4 5.5 Chapter 6 137 Designing a Motivating Work Environment 167 6.1 Performance with Purpose: The Case of PepsiCo 168 6.2 Motivating Employees Through Job Design 169 Importance of Job Design 170 Scientific Management and Job Specialization 170 Alternatives to Job Specialization: Rotation, Enlargement, Enrichment, and Job Crafting 171 Job Characteristics Model 172 Empowerment 175 Motivating Employees Through Goal Setting 178 Goal-Setting Theory 178 Setting SMART Goals 178 Why Do SMART Goals Motivate? 180 When Are Goals More Effective? 181 6.3 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 6.4 182 Ensuring Goal Alignment Through Management by Objectives (MBO) 182 Motivating Employees Through Performance Reviews 183 What Is Performance Management? 184 What Is the Purpose of a Performance Review? 184 Who Is the Rater? 185 What Makes an Effective Review System? 186 Absolute Ratings versus Relative Rankings 186 One-on-One and Performance Review Meetings 187 Managing Potential Bias in Performance Reviews 188 Motivating Employees Through Performance Incentives 190 Performance Incentives 191 Focus on Motivating Work Environments, Ethics, Technology, and National Culture 194 Designing a Motivating Work Environment and Ethics 195 Motivating Work Environments and Technology 195 Designing a Motivating Work Environment Around the Globe 196 6.7 Retail with a Purpose: The Case of REI 197 6.8 Conclusion 199 6.9 Exercises 199 6.10 Endnotes 200 6.5 6.6 Chapter 7 Are There Downsides to Goal Setting? Stress and Emotions at Work 205 7.1 Mitigating Stress with Mission: The Case of SpaceX 206 7.2 What Is Stress? 207 Models of Stress 208 Causes of Stress at Work 210 Outcomes of Stress 216 7.3 7.4 7.5 7.6 Individual Differences in Experienced Stress 218 Managing Stress 219 Individual Approaches to Managing Stress 219 Organizational Approaches to Managing Stress 223 What Are Emotions? 228 Types of Emotions 228 Emotional Contagion 229 Emotions at Work 230 Emotions Affect Attitudes and Behaviors at Work 231 Emotional Labor 232 Emotional Intelligence 233 Focus on Stress, Emotions, and Ethics 236 Stress and Emotions and Ethics 236 Stress, Emotions, and Technology 237 Stress and Emotions Around the Globe 237 7.7 Managing Stress and Emotions: The Case of NASA’s Mission to Mars 239 7.8 Conclusion 240 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Exercises 241 7.10 Endnotes 243 7.9 Chapter 8 Communication at Work 8.1 Communication That Transcends Cultures: The Case of IKEA 248 8.2 Understanding Communication 249 The Communication Process 250 8.3 Communication Barriers 253 Barriers to Effective Communication 253 8.4 Different Types of Communication 260 Types of Communication 260 Communication Channels 265 Direction of Communication Within Organizations 268 External Communications 269 Focus on Communication, Ethics, Technology, and National Culture 271 Ethics and Communication 271 Technology and Communication 272 Cross-Cultural Communication 272 8.6 Instant Messaging in the Workplace: The Case of Slack 274 8.7 Conclusion 275 8.8 Exercises 276 8.9 Endnotes 278 8.5 Chapter 9 247 Groups and Teams at Work 281 9.1 Building Teams with Kindness: The Case of Kind 282 9.2 Group Dynamics 283 Types of Groups: Formal and Informal 284 Stages of Group Development 284 The Punctuated-Equilibrium Model 287 Cohesion 288 Social Loafing 290 9.3 9.4 9.5 Collective Efficacy 291 Understanding Team Design Characteristics 292 Differences Between Groups and Teams 293 Team Tasks 294 Team Roles 295 Types of Teams 297 Team Leadership and Autonomy 298 Designing Effective Teams: Team Composition 300 Managing Effective Teams 302 Team Processes for Effective Teams 303 Engage in Team Performance After-Action Reviews 304 Managing Effective Teams: Workplace Meetings 305 Managing Effective Teams: Putting It All Together 307 Barriers to Effective Teams 309 Common Problems Faced by Teams 309 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Focus on Managing Groups and Teams, Ethics, Technology, and National Culture 311 Ethics and Teams 311 Technology and Teams 311 Teams Around the Globe 312 9.7 Four Generations of Teamwork: The Case of the LEGO Group 313 9.8 Conclusion 315 9.9 Exercises 315 9.10 Endnotes 318 9.6 Chapter 10 Conflict and Negotiation at Work 10.1 Addressing Conflict with Employee Activism: The Case of Google 322 10.2 Understanding Conflict 323 Types of Conflict 324 Is Conflict Always Bad? 326 10.3 Causes and Outcomes of Conflict 328 Causes of Conflict 328 Outcomes of Conflict 330 10.4 Conflict Management 332 Ways to Manage Conflict 332 Conflict-Handling Styles 333 What If You Don’t Have Enough Conflict Over Ideas? 336 10.5 Negotiations 337 The Five Phases of Negotiation 338 Negotiation Strategies 342 When All Else Fails: Third-Party Negotiations 344 10.6 Focus on Conflict and Negotiations, Ethics, Technology, and National Culture Chapter 11 321 346 Ethics and Negotiations 346 Technology, Conflict, and Negotiations 347 Conflict and Negotiation Around the Globe 347 10.7 When Conflict Is Productive: The Case of Amazon 349 10.8 Conclusion 351 10.9 Exercises 352 10.10 Endnotes 354 Decision Making and Creativity at Work 357 11.1 Making the Decision to Invest in Detroit: The Case of Detroit Bikes and Shinola 358 11.2 Understanding Decision Making 360 Decision Making Defined 360 Types of Decisions 361 Making Rational Decisions 362 Making “Good Enough” Decisions 364 Making Intuitive Decisions 365 Making Creative Decisions 365 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 11.3 Faulty Decision Making Avoiding Decision-Making Traps 11.4 Decision Making in Groups 371 375 When It Comes to Decision Making, Are Two Heads Better Than One? 375 Groupthink 376 Tools and Techniques for Making Better Decisions 377 11.5 Focus on Making Decisions, Ethics, Technology, and National Culture Chapter 12 371 380 Ethics and Decision Making 381 Technology and Decision Making 382 Decision Making Around the Globe 383 11.6 Trusting Employees to Make Decisions: The Case of Microsoft 384 11.7 Conclusion 385 11.8 Exercises 386 11.9 Endnotes 389 Leading at Work 391 12.1 An Inclusive Leadership Approach: The Case of Stitch Fix 392 12.2 Who Is Considered a Leader? Trait Approaches to Leadership 394 Intelligence 395 Big Five Personality Traits 395 Self-Esteem 396 Integrity 396 12.3 What Do Leaders Do? Behavioral Approaches to Leadership 398 Leader Behaviors 398 Leader Decision Making 399 Limitations of Behavioral Approaches 400 12.4 What Is the Role of the Context? Contingency Approaches to Leadership 401 Fiedler’s Contingency Theory 401 Situational Leadership 402 Path-Goal Theory of Leadership 403 Vroom and Yetton’s Normative Decision Model 405 12.5 What’s New? Contemporary Approaches to Leadership 408 Transformational Leadership 408 Leader-Member Exchange (LMX) Theory 411 Servant Leadership 414 Authentic Leadership 416 When Leadership Goes Wrong: Abusive Leadership 416 Leader Humility 418 Women and Leadership 418 12.6 Focus on Leading People, Ethics, Technology, and National Culture 419 Leadership and Ethics 420 Leadership and Technology 420 Leadership Around the Globe 421 12.7 A Different Approach to Leadership at Apple: The Case of Tim Cook 423 12.8 Conclusion 424 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 13 12.9 Exercises 425 12.10 Endnotes 426 Power, Influence, and Politics at Work 13.1 The Power of Heart: The Case of Southwest Airlines 432 13.2 The Basics of Power 433 What Is Power? 434 Positive and Negative Consequences of Power 434 The Relationship Between Dependency and Power 436 13.3 The Power to Influence 438 Bases of Power 438 What Is Influence? 441 Commonly Used Influence Tactics 444 Impression Management 446 Direction of Influence 447 13.4 Organizational Politics 450 Organizational Politics 450 Antecedents of Political Behavior 451 13.5 Understanding Social Networks Social Networks 13.6 Focus on Power and Politics, Ethics, Technology, and National Culture Chapter 14 431 453 454 456 Power, Politics, and Ethics 457 Power, Influence, and Technology 457 Power Around the Globe 458 13.7 English Teacher to Billionaire: The Case of Jack Ma 459 13.8 Conclusion 461 13.9 Exercises 461 13.10 Endnotes 465 Organizational Structure and Change at Work 469 14.1 Evolving through Acquisition: The Case of Campbell Soup Company 470 14.2 Understanding Organizational Structure 471 Building Blocks of Structure 471 Contemporary Forms of Organizational Structures 476 14.3 Understanding Organizational Change 480 Why Do Organizations Change? 480 Resistance to Change 484 Why Do People Resist Change? 486 14.4 Planning and Executing Change Effectively 489 The Three Stages of Change 490 Unfreezing Prior to Change 490 Executing Change 492 Refreezing 493 14.5 Focus on Organizational Structure and Change, Ethics, Technology, and National Culture Organizational Structure, Change, and Ethics © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 495 495 Chapter 15 Organizational Structure, Change, and Technology 496 Organizational Structure and Change Around the Globe 497 14.6 Changes in Latitudes, Changes in Attitudes: The Case of Kronos 498 14.7 Conclusion 499 14.8 Exercises 500 14.9 Endnotes 501 Organizational Culture at Work 503 15.1 Strong Culture Leads to Strong Performance: The Case of Costco 504 15.2 Understanding Organizational Culture 505 What Is Organizational Culture? 506 Why Does Organizational Culture Matter? 506 Levels of Organizational Culture 507 15.3 Characteristics of Organizational Culture 508 Dimensions of Culture 508 Strength of Culture 512 Do Organizations Have a Single Culture? 513 15.4 Creating and Maintaining Organizational Culture 514 How Are Cultures Created? 514 How Are Cultures Maintained? 516 Visible Elements of Organizational Culture 522 15.5 Creating Culture Change 527 How Do Cultures Change? 527 15.6 Focus on Organizational Culture, Ethics, Technology, and National Culture 530 Organizational Culture and Ethics 531 Organizational Culture and Technology 531 Organizational Culture Around the Globe 532 15.7 When It Comes to Culture, Strong Signals Matter: The Case of General Motors 533 15.8 Conclusion 534 15.9 Exercises 535 15.10 Endnotes 536 Index © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 539 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. About the Authors Talya Bauer Talya Bauer (Ph.D., Purdue University) is the Cameron Professor of Management and Affiliated Professor of Psychology at Portland State University. She is an award-winning teacher and researcher and recipient of the Academy of Management Human Resource division’s Innovations in Teaching Award as well as the Society for Industrial and Organizational Psychology (SIOP) Distinguished Teaching Contributions Award. She conducts research about relationships at work throughout the employee lifecycle, including leadership, organizational justice, HR analytics, recruitment, applicant and candidate experiences during selection, and new employee onboarding. Her work has been supported by grants from the National Science Foundation (NSF) and the National Institutes of Health (NIH) as well as the Society for Human Resource Management (SHRM) and SIOP foundations and has been published in research outlets such as the Academy of Management Journal, Academy of Management Learning and Education Journal, Academy of Management Perspectives, Journal of Applied Psychology, Journal of Management, Journal of Organizational Behavior, and Personnel Psychology. She has worked with dozens of government, Fortune 1000, and startup organizations and has been a Visiting Scholar in France, Italy, Singapore, Spain, the UK, and at Google Headquarters, and she has delivered keynote addresses in Australia, France, Greece, Norway, Spain, the UK, and the United States. She has served in elected positions, including the HRM Executive Committee of the Academy of Management and Member-at-Large for SIOP as well as SIOP President. She is currently an Associate Editor for the Journal of Applied Psychology (and the former Editor-in-Chief of Journal of Management). Her work has been discussed in Bloomberg Businessweek, Harvard Business Review, the New York Times, USA Today, Wall Street Journal, and NPR’s All Things Considered, and her work has been referenced 16,000+ times by scholars in their own work. She is a Fellow of SIOP, the American Psychological Association, the Association for Psychological Science, and the International Association of Applied Psychology. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 2 Organizational Behavior Berrin Erdogan Berrin Erdogan (Ph.D., University of Illinois at Chicago) is the Express Employment Professionals Professor of Management and Affiliated Professor of Psychology at Portland State University where she was recognized with the Innovative Teaching Award. Berrin’s research focuses on two themes. First, she examines how leaders lead through the relationships they build with their employees; and the implications of manager-employee relationships for employee effectiveness, retention, and well-being. Second, she is interested in understanding person-job fit and misfit, with a focus on why and how employees find themselves overqualified for their jobs and the consequences of being overqualified. She conducted studies and shared results with organizations in manufacturing, retail, health care, education, information technology, construction, and banking among others, in the USA, the UK, China, Turkey, Vietnam, France, and India. To date, she has published over 70 journal articles and book chapters. She has also coauthored Essentials of Organizational Behavior and Principles of Management published by FlatWorld, Psychology and Work published by Routledge, and Human Resource Management: People, Data, and Analytics by Sage Press. She co-edited the Oxford Handbook of Leader-Member Exchange, published by Oxford University Press. Her work has been discussed in media outlets, including the New York Times, Harvard Business Review, CNBC, BBC Capital, and Wall Street Journal, among others. She was elected a Fellow of the Society for Industrial and Organizational Psychology (SIOP) and the Association for Psychological Science (APS) for unique and unusual contributions to the field of applied psychology. She is the Editor-in-Chief of Personnel Psychology. Previously, she served as an associate editor for European Journal of Work and Organizational Psychology and Personnel Psychology. Berrin is a frequent speaker at national and international conferences and has served as a visiting scholar and given invited talks in Australia, Canada, Greece, Iceland, Singapore, Spain, Turkey, the UK, and the US. An Award-Winning Text We are proud to announce that Organizational Behavior by Talya Bauer and Berrin Erdogan has been awarded the prestigious TAA (Text and Academic Authors Association) Texty Award. This award is given based on four key criteria, including how the book is rated in terms of being interesting and informative, well organized and well prepared, up to date and appealing, and containing teachable material. Congratulations on this incredible honor! © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Acknowledgments While our names are on the cover of this book as authors, our experience is that creating a high quality textbook requires a team of dedicated individuals. We would be remiss not to thank our team who has helped us every step of the way. Special thanks to Sean Wakely for being a champion of our book from the first day we met. We also want to thank KB Mello for wonderful editing, supporting, and general project management of our revisions over the years. FlatWorld has been through a lot of changes since we first signed up with them to help bring the price of textbooks down to earth. Special thanks to Alastair Adam and John Eielson at Boston Academic who have done a great job supporting our work and improving on affordable, digital-first textbooks since they took over in 2016. Finally, we would like to thank Timothy Oxendahl, Brittany Bradford, and Rachel Mattenberger for their help in our work to keep Organizational Behavior up to date. We would also like to thank the following colleagues for their invaluable feedback and suggestions for improving the material in each of our editions. Each of you has helped to make this a better and better text over time: Cheryl Adkins, Longwood University Luanne Amato, Holy Family University Smriti Anand, Illinois Institute of Technology Sid Barsuk, Governors State University James W. Berry, University College, London Carrie Blair, College of Charleston Colleen Bryan, Mount Vernon Nazarene University Pamela Buckle Henning, Adelphi University Dave Cadiz, Portland State University Shari Carpenter, Eastern Oregon University Elizabeth Chapman, Mercer University Claudia Cogliser, Texas Tech Leslie Connell, University of Central Florida Donald Dahlin, The University of South Dakota Jeanne Enders, Portland State University Gideon Falk, Purdue University, Calumet Tammy Foster-Knight, Southern New Hampshire University David Futrell, Butler University Bruce Gillies, California Lutheran University Deborah Good, University of Pittsburgh Jennifer Griffith, University of New Hampshire Laura Guerrero, University of Houston Michael Hadani, Long Island University, CW Post Campus Jeff Haldeman, Webster University Kathy Harris, Northwestern Oklahoma State University Catherine A. Honig, National Luis Universty © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 4 Organizational Behavior Kelly Kilcrease, University of New Hampshire, Manchester Eugene Kim, Georgia Tech Eden King, Rice University Antoinette S. Knechtges, Eastern Michigan University Michael Komos, Benedictine University John Lanzoni, Dean College Jennifer Loney, Portland State University Damian Lonsdale, University of South Dakota Layla Mansfield, Oregon Health & Science University Jean Marrapodi, New England College of Business Don McCormick, California State University, Northridge Barbara Minsky, Troy University Janet Moen, The University of North Dakota Caroline Mourits, Wentworth Institute of Technology Lorrie Mowry, McCook Community College Cynthia Busin Nicola, Carlow University Troy Nielson, Brigham Young University Peter Nowak, Boston College, Boston University, Suffolk University Pamela A. Peralta, University of Guam Samuel Rabinowitz, Rutgers University Gary Renz, Webster University Brenda Riddick, California State University, Dominguez Hills Laura Riolli, California State University, Sacramento Larry Rudiger, The University of Vermont Joy Schneer, Rider University Mark Schwiesow, Marquette University Shung Jae Shin, Portland State University Leslie Shore, Metropolitan State University Ann B. Smith, North Dakota State College of Science Valarie Spiser-Albert, University of Texas at San Antonio Karen Stewart, North Central Texas College Christy Weer, Salisbury University Marilyn Wesner, George Washington University Jim Woodrum, University of Wisconsin-Madison Doyle W. Young, California State University, San Marcos Beverly Younger, University of Southern California Guozhen Zhao, Delaware State University Please let us know if you have any feedback on Organizational Behavior 4.0 at OBbyBauerErdogan@gmail.com. If you are referring to a specific page, section, or feature, please put that in your note as well. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Preface To love what you do and feel that it matters—how could anything be more fun? — Katharine Graham This quote sums up how we feel about teaching. What could be better than teaching? It is fun, at times exciting, and it really matters. And one of the best courses in the world to teach is Organizational Behavior. Together we have been teaching for over 50 years and have taught thousands of students at the undergraduate, master’s, and doctoral levels. Our teaching styles are different, but we share some common values when it comes to teaching, including the beliefs that: • Organizational behavior matters. • Evidence-based research is the foundation of organizational behavior. • Students learn in different ways. • There is no substitute for hands-on learning. • Learning the language of OB helps you be more effective in the workplace. • Technology can greatly enhance learning. • Flexibility in teaching delivery allows for student success. Not “Just Another” Textbook As we approached the first edition of this book, we knew we didn’t want to write “just another” OB book. Enter FlatWorld. Their model solves many of the common challenges faculty and students face when it comes to textbooks. Here are a few that have always bothered us and that FlatWorld has solved: • “I had to buy the whole book, but my teacher didn’t use the XYZ chapter.” This isn’t a problem with our book because faculty can rearrange chapters as well as add and delete them. • “Textbooks are too expensive!” Textbooks have traditionally been very expensive and the business model of traditional publishing firms has been a huge part of those costs. With our book, students get to choose how to read the material in a number of inexpensive formats ranging from online viewing, color books, audio chapters, or printable PDFs. • “New editions come out too quickly and don’t really change.” The reason that new editions come out is that used books don’t make money for the publishers, but new ones do. With our book, you can change editions when you want and when you think enough is different to warrant the change. Our journey in creating this book has been a long one. After we wrote the first draft of this book, each chapter went through multiple reviews and revisions, as well as beta tests with real students before this textbook made its way to you. A truly virtual team of authors, copy editors, managing editors, graphic designers, technology gurus, and publishing experts worked together to create something that had never been done before. As we approached the 3rd edition and now the 4th edition, we kept in mind our original goals and vision for this book. We hope you enjoy it! © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 6 Organizational Behavior What’s New in Version 4.0? This version of the book has a whole new look and feel. For example, the following changes have been made: Shutterstock.com • We have updated the content to ensure that our text reflects the most current developments in the field of organizational behavior and includes findings from recent cutting-edge trends, developments, and research. For example, we now include information on Big Data, Analytics, and Ethical and Legal Online Privacy Concerns and General Data Protection Regulation (GDPR) compliance issues. In fact, we have added a section on the technology implications for every chapter. • This revision includes 15 new opening chapter cases. New cases include companies and leaders at Cayuga Collection, Gap, Inc., Fully, Zoom, PepsiCo, Patagonia, SpaceX, IKEA, Kind, Google, Detroit Bikes, StitchFix, Southwest Airlines, Campbell Soup Company, and Costco. • All closing cases were updated to include the latest content. They include companies and leaders at Brew Dr. Kombucha, Salesforce.com, Netflix, SAS, Walt Disney Company, REI, NASA, Slack, The Lego Group, Amazon, Microsoft, Apple, Alibaba, Kronos, and General Motors. • Those who loved any of the previous 15 cases that were replaced in this edition (or any of the dozens of cases written to accompany Organizational Behavior versions 1.0, 2.0, and 3.0) need not fear. We have updated these cases as well, and they can now be found within the all-new Instructor’s Manual and/or the Organizational Behavior Case Book. • This edition is streamlined to make key points more quickly and powerfully than ever before. Chapters have been updated to include the most relevant information while removing distractions. In fact, we made all of our changes while reducing the overall length of the book. • All facts and figures have been updated so that the most current information is included. • New small, medium, large, and not-for-profit businesses and NGOs and associated examples are featured throughout the book. • What hasn’t changed is our commitment to writing in a concise, accessible, and engaging manner to communicate the latest findings and best practices related to mastering Organizational Behavior. We hope you and your students enjoy this edition as much as we enjoyed writing it! What Will You See? Our book emphasizes active learning, meaningful examples, and tools you can use today or put into your OB Toolbox for the years to come. How do we do this? • We wrote opening and closing cases that bring the topics to life. • We included learning objectives, key takeaways, and discussion questions for every section of each chapter. • We created OB Toolboxes with information you can use today and save for the future. • We wrote a section on cross-cultural implications for every chapter. Shutterstock.com • We wrote a new section on technology implications for every chapter. • We also wrote a section on ethical implications for every chapter. • We included original ethical dilemmas, individual exercises, and group exercises for every chapter. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Preface 7 How Are Instructors Supported? • For faculty, we have a comprehensive homework platform, PowerPoint slides, a rich test bank, and an extensive author-written Instructor’s Manual to enrich teaching. • The Instructor’s Manual contains many features, including: • A summary of relevant online TED Talks and videos to go with each chapter • A summary of IdeaCasts listed at the beginning of the manual • Discussion questions for the opening cases • Answers to the discussion questions throughout the book • The comprehensive Organizational Behavior Case Book with all of our cases across the current and previous editions of this book • End-of-chapter materials consist of the following: • Ethical dilemmas • Individual exercises • Group exercises • Solutions to the end-of-chapter materials • Bonus material • Further reading suggestions Given that Organizational Behavior (OB) is an important management course, our objective in developing this material was to provide students and instructors with a solid and comprehensive foundation on OB that is accessible and fun. Each of the 15 chapters is comprehensive but succinct and action oriented, whether you are just starting out in the world of work or if you are an experienced manager. Moreover, the book and supplements have been written in a direct and active style that we hope students and instructors find both readily accessible and relevant. Thank You for Joining Us We hope you find Organizational Behavior: Bridging Science and Practice, 4.0 to be informative, accessible, and fun! © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 8 Organizational Behavior © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. CHAPTER 1 Organizational Behavior at Work Shutterstock.com Learning Objectives After reading this chapter, you should be able to understand and articulate answers to the following questions: 1. What is organizational behavior (OB)? 2. Why does organizational behavior matter? 3. How can I maximize my learning and retention? 4. What research methods are used to study organizational behavior? 5. What are the emerging trends that will influence OB? Adults spend a majority of their awake time at work. Organizational behavior is all about understanding factors at the individual, group, and/or organizational level that help or hinder individual and organizational interactions and effectiveness. You will see that the textbook is organized around these three levels, but please also keep in mind that individual differences influence group interactions as well as perceptions of organizations, so the distinction among the three levels is not purely distinct. In this chapter, you will learn about the ways in which OB can help you understand how research and best practices can make you more effective in organizational life. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 10 Organizational Behavior 1.1 The Power of People: The Case of Cayuga Collection Andrea Bonilla, Co-founder and Vice President, Cayuga Collection Source: Photographed in Costa Rica by Mike Dell. Used by permission from Cayuga Collection. The Cayuga Collection is an excellent example of how an organization can exert power and influence to positively impact its employees, customers, and the community at large. While the name Cayuga comes from Cayuga Lake in Ithaca, New York where its two founders went to school at Cornell University, The Cayuga Way means “travel done differently” and also “travel done inclusively.” Founded in 1999 by Hans Pfister and Andrea Bonilla, the Cayuga Collection offers luxury vacation properties while supporting sustainable practices. Since that time, the company has opened up multiple new markets and has grown to include over 400 staff members across three countries, including Costa Rica, Nicaragua, and Panama. They specialize in properties with no more than 50 rooms, focus on the luxury segment of the market, and have a strong commitment to sustainability, evidenced by the 1,500+ acres of rainforest that they protect. What is the key to the company’s success? According to the founders, it’s not simply an innovative approach to sustainable luxury vacations. More importantly, it’s “all about the people.” The Cayuga Collection is a pioneer in the area of eco-tourism, largely due to their ingenious solutions grounded in the power of people who know the area best—the locals who live there and make up the community. When they began, they focused more on the efficient use of resources and conserving the natural environment. However, as the tourism industry shifted toward sustainability, the Cayuga Collection began to realize that, without “buy in” from staff and the local communities where their properties reside, their sustainability efforts were not going to be effective. From design solutions, building and infrastructure, to the day-to-day operations, the Cayuga Collection leads and learns from the people around them. They are continually asking, “How can we make this even better?” and have learned that good ideas come from within. In fact, they created the Cayuga Innovation Contest to tap into the collective knowledge of their 400+ staff members and to date have come up with 65 actionable innovative ideas to help blend luxury and sustainability. It is clear that the team of passionate men and women dedicated to The Cayuga Way have greatly contributed to the success of the company. Due to their innovation and success, the Cayuga Collection has garnered worldwide acclaim. Their hotels have seen famous guests such as Nobel prize winners, CEOs, politicians, and celebrities like Charlize Theron. In 2010 they won the World Saver Award from Condé Nast Traveler and Travel + Leisure’s Global Vision Award in the Environmental Leadership category. They were also honored with the 2017 National Geographic World Legacy Award in the category of Earth Changers, recognizing their cutting-edge leadership in environmentally friendly business practices and green technology. In 2018, The World Travel & Tourism Council awarded Cayuga the Tourism for Tomorrow Award in the People category. By creating authentic and truly meaningful experiences for their guests, the Cayuga Collection persuades people to think differently about what “luxury” means. As co-founder and Vice President Andrea Bonilla says, “It’s about creating awareness. When guests come to our properties, © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work for example, our staff needs to be able to show them that the luxury they are receiving there is not about things. It’s about people. Connecting with the land, learning new ways to connect with the environment around you, and connecting with each other creates a unique vision and everyone wants to work towards the same goal.” Beyond empowering their employees and persuading their guests to think differently about eco-tourism, the Cayuga Collection seeks to positively influence the local communities and surrounding ecosystems. For example, they buy local, toiletries come in refillable glass containers and include products produced in Costa Rica, and they’ve banned all single-use plastics from their properties. They’ve also created smart solutions for irrigating their verdant hotel grounds. Finally, they run programs to help local schools and communities. Part of the power of the Cayuga approach is one of persuading people to think differently than they normally do about what luxury means. Cayuga also attempts to get people to think differently about what eco-tourism means since their properties are all located in remote destinations that mainly require flights to reach them. By buying local, employing local, and establishing programs that benefit local communities and ecosystems, the Cayuga Collection has built a successful enterprise. More importantly, however, they have demonstrated how power and influence can be used for good.[1] Multimedia Extension—The Cayuga Way: Our Sustainable Philosophy View in the online reader Case Discussion Questions 1. The Cayuga Collection places great value on feedback and insight from employees. What unique perspective can employees provide that might not necessarily be available from an outside party? 2. The Cayuga Collection has won numerous awards while also attracting high-profile guests. What are some other metrics that could be used to quantify this organization’s success? 3. The Cayuga Collection has become successful by simultaneously prioritizing people, profit, and the planet, also known as the “triple bottom line” approach. In your opinion, what are some of the barriers organizations may face when attempting to adopt this approach? 4. If you were the CEO of the Cayuga Collection, would you, in any way, try to redefine what it means to do business “The Cayuga Way”? If so, please describe the changes you would make. 5. The Cayuga Collection focuses on the luxury segment of the market. Do you think their model could be implemented in non-luxury vacation markets? Please explain. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 11 12 Organizational Behavior 1.2 Understanding Organizational Behavior Learning Objectives 1. Learn about the layout of this book. 2. Understand what organizational behavior is. 3. Understand why organizational behavior matters. 4. Learn about OB Toolboxes in this book. About This Book The people make the place. —Benjamin Schneider, Fellow of the Academy of Management In 2020, Fortune magazine’s #1 Best Place to Work recognition went to Hilton. One employee noted, “I love how I don’t feel like just a number here. I am a strong believer that Hilton cares about their employees just like they care about their family.” Alex Segre/Shutterstock.com This book is all about people. It is especially about people at work. As evidenced in the opening case, we will share many examples of people trying out new things, developing, growing, and making their workplaces work. People can make work an exciting, fun, and productive place to be, or they can make it a routine, boring, and ineffective place everyone dreads. The late Steve Jobs, cofounder and former chairman and CEO of Apple Inc., attributed the innovations at Apple, which include the iPod, MacBook, iPhone, and iPad, to people, noting, “Innovation has nothing to do with how many R&D dollars you have. It’s not about money. It’s about the people you have, how you’re led, and how much you get it.”[2] Current Apple CEO, Tim Cook, continues this philosophy, regularly acknowledging his employees. For example, he recently tweeted, “Thank you to our outstanding retail teams around the world. Your contagious energy and passion represent the best of Apple. It’s a privilege to work with all of you.”[3] Mary Kay Ash, founder of Mary Kay Inc., a billion-dollar cosmetics company, makes a similar point, saying, “People are definitely a company’s greatest asset. It doesn’t make any difference whether the product is cars or cosmetics. A company is only as good as the people it keeps.” Just like people, organizations come in many shapes and sizes. We understand that the career path you take may include a variety of different organizations. In addition, we know that each student reading this book has a unique set of personal and work-related experiences, capabilities, and career goals. On average, a person working in the United States will change jobs nearly twelve times in their career.[4] In order to succeed in this type of career situation, individuals need to be armed with the tools necessary to be lifelong learners. So, this book is not about giving you all the answers to every situation you may encounter when you start your first job or as you continue up the career ladder. Instead, this book gives you the vocabulary, frameworks, and critical-thinking skills necessary for you to diagnose situations, ask tough questions, evaluate the answers you receive, and act in an effective and ethical manner in a variety of different contexts. Throughout this book, when we refer to organizations, we will include examples that may apply to diverse organizations, such as publicly held, for-profit organizations like General Motors, © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work 13 StitchFix, and Netflix; privately owned businesses such as SpaceX and Detroit Bikes; governmentfunded organizations such as NASA; co-op owned organizations such as REI; and B Corporations (B Corps) such as Brew Dr. Kombucha and Tea. We will also refer to both small and large corporations. You will see examples from Fortune 500 organizations, such as Costco, Walt Disney, or PepsiCo; nonUS-based organizations such as IKEA and Alibaba; as well as small start-up organizations. Keep in mind that some of the small organizations of today may become large organizations in the future. For example, in 1998, eBay Inc. had only 29 employees and $47.4 million in income,[5] but over 20 years later in 2020 eBay had 13,000+ employees and more than $10 billion in revenue.[6] Regardless of the size or type of organization you may work for, people are the common denominator of how work is accomplished within organizations. Together, we will examine people at work both as individuals and within work groups and how they impact and are impacted by the organizations where they work. Before we can understand these three levels of organizational behavior, we need to agree on a definition of organizational behavior. What Is Organizational Behavior? Organizational behavior (OB) is defined as the systematic study and application of knowledge about how individuals and groups act within the organizations where they work. As you will see throughout this book, definitions are important. They are important because they tell us what something is as well as what it is not. For example, we will not be addressing childhood development in this course—that concept is often covered in psychology—but we might draw on psychology research to understand the basics of perception, or the nature of power. organizational behavior (OB) The systematic study and application of knowledge about how individuals and groups act within the organizations where they work. OB draws from other disciplines to create a unique field. As you read this book, you will most likely recognize OB’s roots in other disciplines. For example, when we review topics such as personality and motivation, we will again review studies from the field of psychology. The topic of team processes relies heavily on the field of sociology. In the chapter relating to decision making, you will come across the influence of economics. When we study power and influence in organizations, we borrow heavily from political sciences. Even medical science contributes to the field of organizational behavior, particularly to the study of stress and its effects on individuals. Those who study organizational behavior—which now includes you—are FIGURE 1.1 Levels of Organizational interested in several outcomes, such as work attitudes (e.g., job satisfaction and Behavior organizational commitment) and workplace behaviors (e.g., customer service and OB spans topics ranging from the individual to counterproductive work behaviors). A distinction is made in OB regarding which the organization. level of the organization is being studied at any given time. There are three key levels of analysis in OB: the individual, the group, and the organization. For example, if we want to understand our boss’ personality, we would be using the individual level of analysis. If we want to know about how our manager’s personality affects our team, we are examining things at the team, or group, level. But if we want to understand how our organization’s culture affects organizational performance, we would be interested in the organizational level of analysis. Why Organizational Behavior Matters OB matters at three critical levels. It matters because it is all about things you care about. OB can help you become a more engaged organizational member. Getting along with others, getting a great job, lowering your stress level, making more effective decisions, and working effectively within a team; these are all great things, and OB addresses them! © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. levels of analysis In organizational behavior, this includes examining the individual, the group, and the organization. 14 Organizational Behavior It matters because employers care about topics that are covered in OB. A recent survey by the National Association of Colleges and Employers (NACE) determined which skills are the most important for employers when evaluating college graduate job candidates, and OB topics topped the list as you can see below.[7] The top five personal qualities/skills: 1. Problem-solving skills 2. Ability to work in a team 3. Strong work ethic 4. Analytical/quantitative skills 5. Communication skills (written) Finally, it matters because organizations care about understanding people. The best companies in the world understand that the people make the place. How do we know this? We know that organizations that value their employees are more profitable than those that do not.[8] Research shows that successful organizations have a number of things in common, such as providing employment security, engaging in selective hiring, utilizing self-managed teams, being decentralized, paying well, training employees, reducing status differences, and sharing information.[9] Glassdoor.com, a popular review website of corporations, highlights the best companies, such as Boston Consulting Group, In-N-Out Burger, and Lululemon, where employees give kudos to management for providing learning opportunities, giving employees challenging and interesting work and not micromanaging the process, and treating employees with respect. Research shows that organizations that are considered healthier and more effective focus on how they relate to their employees by being deliberate and mindful about providing role clarity, information sharing, and performance feedback. Unfortunately, research shows that many organizations do not have employees reporting that they have healthy work cultures. For example, only 20% of employees strongly agree that their organization’s performance management approach motivates them to do their best work.[10] Clearly, there’s room for better organizational behavior in many organizations. In the rest of this chapter, we will build on how you can use this book by adding tools to your OB Toolbox in each section of the book as well as assessing your own learning style preferences. In addition, it is important to understand the research methods used to define OB, so we will also review those. Finally, you will see what challenges and opportunities businesses are facing and how OB can help overcome these challenges. Adding to Your OB Toolbox Throughout the book, you will see many OB Toolbox features. Our goal in writing this book is to create something useful for you to use now and as you progress through your career. Sometimes we will focus on tools you can use today. Other times we will focus on things you may want to think about that may help you later. As you progress, you may discover some OB tools that are particularly relevant to you while others are not as appropriate at the moment. That’s great—keep those that have value to you. You can always go back and pick up tools later on if they don’t seem applicable right now. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work OB Toolbox: Skill Survival Kit Tom Peters is a management expert who talks about the concept of individuals thinking of themselves as a brand to be managed. Further, he recommends that individuals manage themselves in ways that allow them to continue to develop. Here are several ideas for being effective in keeping up your skill set. Shutterstock.com • Know yourself. Take a personal inventory and see where you are. What are your talents? Where are you weak and could use additional practice? • Keep your skills fresh. Consider revolutionizing your portfolio of skills at least every six years. • Master something. Competence in many skills is important, but excelling at something specific will set you apart. • Embrace ambiguity. Many people fear the unknown. They like things to be predictable. Unfortunately, the only certainty in life is that things will change. Instead of running from this truth, embrace the situation as a great opportunity. • Be authentic. Don’t force yourself to be something you are not. You won’t be comfortable and others won't get to know the “real you.” • Network. The term has been overused to the point of sounding like a cliché, but networking works. This doesn’t mean that having 200 connections on LinkedIn or Facebook makes you more effective than someone who has 50, but it does mean that getting to know people is a good thing in ways you can’t imagine. • Don’t over- (or under-) sell yourself. Underpromising and overdelivering can be a wise strategy, but don’t sell yourself short. Be sure to share your successes with others; just don’t overdo it. • Appreciate new technology. This doesn’t mean you should get and use every new gadget that comes out on the market, but it does mean you need to keep up with what the new technologies are and how they may affect you and the business you are in.[11] The important thing to keep in mind is that the more tools and skills you have, the higher the quality of your interactions with others will be and the more valuable you will become to organizations that compete for top talent.[12] It is not surprising that, on average, the greater the level of education you have, the more money you will make. Those with a bachelor’s degree make over 67% more money than those who have a high school degree, and the differences in pay continue to grow with those earning a master's degree making more than double the income of a high school graduate.[13] Organizations value and pay for skills, as the next figure shows. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 15 16 Organizational Behavior FIGURE 1.2 Unemployment Rates and Earnings by Educational Attainment, 2019 Education and training have financial payoffs as illustrated by these unemployment rates and earnings for workers age 25 and older in 2019. Earnings are for full-time wage and salary workers. Source: U.S. Bureau of Labor Statistics. (2019). Unemployment rates and earnings by educational attainment, 2019. Retrieved from https://www.bls.gov/emp/chart-unemployment-earnings-education.htm Isn’t OB Just Common Sense? As instructors we have heard this question many times. The answer, as you might have guessed, is no—OB is not just common sense. As we noted earlier, OB is the systematic study and application of knowledge about how individuals and groups act within the organizations where they work. Systematic is an important word in this definition. It is easy to think we understand something if it makes sense, but research on decision making shows that this can easily lead to faulty conclusions because our memories fail us. We tend to notice certain things and ignore others, and the specific manner in which information is framed can affect the choices we make. Therefore, it is important to rule out alternative explanations one by one rather than to assume we know about human behavior just because we are humans! Go ahead and take the following quiz and see how many of the 10 questions you get right. If you miss a few, you will see that OB isn’t just common sense. If you get them all right, you are way ahead of the game! © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work Putting Common Sense to the Test Please answer the following 10 questions by noting whether you believe the sentence is true or false. 1. Brainstorming in a group is more effective than brainstorming alone. _____ 2. The first five minutes of a negotiation are just a warm-up to the actual negotiation and don’t matter much. _____ 3. The best way to help someone reach their goals is to tell them to do their best. _____ 4. If you pay someone to do a task they routinely enjoy, they’ll do it even more often in the future. _____ 5. Pay is a major determinant of how hard someone will work. _____ 6. If a person fails the first time, they try harder the next time. _____ 7. People perform better if goals are easier. _____ 8. Most people within organizations make effective decisions. _____ 9. Negative people are more likely to quit their jobs when they are unhappy at work. _____ 10. Teams with one smart person outperform teams in which everyone is average in intelligence. ______ You may check your answers with your instructor. Key Takeaway This book is about people at work. Organizations come in many shapes and sizes. Organizational behavior is the systematic study and application of knowledge about how individuals and groups act within the organizations where they work. OB matters for your career, and successful companies tend to employ effective OB practices. The OB Toolboxes throughout this book are useful in increasing your OB skills now and in the future. What do you think? 1. Which type of organizations have you had the most experience with? How did that affect your understanding of the issues in this chapter? 2. Which skills do you think are the most important ones for being an effective employee? 3. What are the three key levels of analysis for OB? 4. What is the problem with the idea that OB is common sense? 5. How do you plan on using the OB Toolboxes in this book? Creating a plan now can help to make you more effective throughout the term. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 17 18 Organizational Behavior 1.3 Learning and Retention Learning Objectives 1. Understand what learning means. 2. Summarize key factors related to learning and retention success. 3. Understand different learning style preferences. 4. Explore strategies for effective learning and retention. Learning and Retaining Information learning A relatively permanent change in knowledge or skill produced by experience. retention The ability to recall or recognize what has been learned over time. Have you ever wondered how humans learn? Learning is defined as a relatively permanent change in knowledge or skill produced by experience.[14] Let’s break down this definition to emphasize the key pieces needed to establish that learning has taken place. First, no learning has occurred if it is not lasting. Second, if a person already knew the content and then took a test and scored 100%, that doesn’t indicate learning happened recently; of course, at some point, this person learned the material on the exam. Finally, experience can occur in many ways. Hearing about another person's experience, reading a book, or practicing a new skill are all types of experiences. However, as simple as the definition of learning is, we know that learning is a complex process. Factors affecting whether learning takes place include learner characteristics such as ability, readiness, and motivation to learn. The learning environment and context also matter, such as the location where learning takes place, what needs to be learned, and how similar or dissimilar the new knowledge or skill is to previous learning. Another key aspect to consider when thinking about learning is how much is retained over time and how we can enhance retention. We do know that the retention of information three days after a meeting or other event is six times more effective when information is presented using a combination of visual and oral modes when compared to only speaking. In the end, based on meta-analytic summaries of the training literature, we know that learning outcomes are most strongly related to both motivation and mental ability.[15] Memory memory The ability to recall information. Human memory is foundational in all we do. Memory refers to our ability to retain and recall information. We retain memories for different periods of time. There are memories that we retain for only a few seconds or hours, which are called short-term memories. Memories that last months and years are called long-term memories. When taking university classes, the goal is to have you both learn and retain information over time so that you have access to it when you encounter relevant situations. Yes, you could search for a definition of authentic leadership if someone asked you what it is. But, it is much more useful if you understand what it is, understand when it is normally helpful or not, and recognize if it makes sense to employ in a given leadership context. But, you may not be a manager of others when you are taking this course. This means that if you only retain the information in this book for a few weeks, you won’t have access to it when you may need it to help you be effective later in school or at work. To understand more about how you can use what we know about memory and how to acquire and retain information in this course and in your life in © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work 19 general, we cover chunking, repetition, the importance of meaning and motivation, and techniques for learning. Chunking Chunking refers to the process of taking single pieces of information and grouping them into larger units. For example, consider this course. You are reading this book about organizational behavior. There is a lot of information to cover. At first, each definition, concept, or research finding may seem like a unique piece of information. Mastering all of it can feel pretty overwhelming. But, if you start to learn more and more about organizational behavior, you start being able to chunk this information into larger pieces such as information about individuals, groups, and organizations. Or, you may think about each chapter as a chunk of information. And, you may begin to think about factors related to important outcomes such as job satisfaction, job performance, and turnover. Doing so allows you to be more efficient and to encode, retain, and recall more and more information over time. As you advance in your studies, you will become more and more efficient at doing this. One way you probably do this every day is when recalling your school ID. You rarely consider each of the numbers separately but instead think of them as one ID number. chunking The process of taking single pieces of information and grouping them into larger units. Repetition Repetition is a great way to learn a new skill or to master information on a topic. Learning and reviewing information over and over again over time is more effective when it comes to retaining information. While focusing on learning over a short period of time can be helpful for acquiring information, we’ve all seen how “cramming” for an exam is not conducive for long-term retention. Thus, studying over time is more effective than doing so all at once, especially when there is a lot of information to be covered.[16] Another factor that matters for learning and retention is how often a learner will use the newly acquired knowledge or skill. For example, bank employees often overlearn procedures to be followed during a bank robbery. Overlearning refers to continued studying and practice after initial proficiency has been achieved. In other words, they practice repeatedly even after acquiring the basic skills because while an actual robbery is relatively rare, and hostages being taken is even more rare, the stakes are high to perform well during this type of situation.[17] Meaning and Motivation When it comes to learning and retention, we know that learners expend more effort and are more effective when they find what they are learning to be meaningful.[18] The more motivated that you are, the better your learning will probably be. That is because when something is seen as meaningful, we are willing to invest more time and attention to it. As a student, you may have noticed that classes in your major tend to be more interesting to you and that you spend more time and effort on those classes. The key is understanding these points and being willing to invest time to master material even when you are not naturally as interested in the content. If you can come up with ways to make different material meaningful to you, perhaps by considering that it may be useful to you later on in your career, it can help you maintain interest and effort over time. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. overlearning Continued studying and practice after initial proficiency has been achieved. 20 Organizational Behavior Learning Style Preferences visual learner One who processes information by looking at words and diagrams. auditory learner One who processes information by listening or talking about it. kinesthetic (tactile) learner One who processes information by actively engaging with the material. You might be wondering about different ways to learn and your own learning preferences. It turns out that individuals do have preferences in terms of how they learn. Some people prefer to learn by seeing information. For example, those who prefer to obtain information by reading and looking at diagrams and flow charts, have a preference aligned with visual learners. If you prefer to learn by listening to others such as in lectures, conversations, and videos, you have a preference aligned with auditory learners. Finally, if you have a preference for actually doing things and learning from trial and error, your preferences align with kinesthetic (tactile) learners. These really are just preferences, not recommendations for how you actually learn best. So, if you find yourself in a situation where you need to teach someone to do or know something new, using a variety of approaches is helpful. Because, while individuals tend to have preferred learning styles, being able to adapt to different learning situations is a big plus. So anytime you get a chance to learn in a new way, grab it. The more you practice, the better you will become at learning to process information in different ways. It is important to understand and engage in different learning opportunities because research shows that while individuals tend to have different preferences for different learning styles, learning in their preferred mode does not actually lead to higher levels of learning or retention.[19] Learning Techniques for Students There are a variety of techniques available to students that help maximize their learning success. In this section, we will cover effective notetaking, quizzing, and internships and practicums as a set of effective techniques that you can use. Effective Notetaking Taking notes during lectures and on assigned readings is a common way for students to learn and retain information. Taking notes allows one to review the information, which is important for encoding information and is related to higher performance in college classes.[20] Thus, it is clear that notetaking is important. What is less clear is whether the manner of taking notes matters. In a study comparing notes taken using a laptop versus writing them out in longhand found some interesting differences. Those taking notes on a laptop produced more notes than those writing them out longhand. However, those who wrote them out in longhand had better retention. The researchers posited that this is because typing allows for more verbatim (exact) quoting of lectures while writing things out longhand forces notetakers to actually process the information and reframe it in their own, more meaningful to them, words.[21] In another study, they found that it depends on the type of information that needs to be learned. If verbatim retention is needed, laptop notetaking may be better. But, if the goal is to encode and retain information, taking notes in longhand may be preferred.[22] One way to consider the best of both of these approaches is to take notes in longhand using a computer stylus on a laptop that accepts screen input. This allows you to obtain the benefits of both approaches. Another popular study technique is to highlight key words, concepts, and phrases. However, doing so is even more passive than typing out notes and should be supplemented with other more active learning strategies. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work Quizzing We know that taking notes in longhand helps with learning and retention. We also know that repetition can be helpful in encoding new information. However, it is really easy to read about new concepts and think that they “make sense.” Until you actually test the assumption that you have effectively integrated the new information into your memory, it is tough to know if you can recall that information. Thus, quizzing yourself and taking prepared quizzes are great ways to see if you really know as much as you think you do. And, if you find areas where your knowledge is not solid, you can focus more time and attention on studying those areas and less on areas where you’ve already mastered the knowledge. Consider making flashcards (writing them out by hand will actually help you learn the information) and asking someone to quiz you, as these are great ways to encode, retain, and test yourself all at one time.[23] Keep going over the cards that you miss and remove the cards that you can answer correctly from the deck so that you are spending the most time on the items you need work on. This can be an efficient way to learn about organizational behavior. Internships and Practicums There is no substitute for hands-on experience as a way to learn. In addition, students who have more work experience are more successful in securing employment. We hear from undergraduate students all the time that a reason given when rejected for jobs they have applied for is their “lack of experience” either generally or in their area of study. This is unfortunate because many job opportunities exist for students that become unavailable after they graduate. Both internships and practicums are ways for students to gain experience, and we encourage students to complete as many as possible while earning their degrees. As a college student, internships are often available that can serve to help students gain valuable experience and personal growth, land better jobs, and do better on those jobs once gained. Internships are also a great way to try out a job, industry, or career before fully committing to it. Research shows that of the 2019 graduating college seniors who received at least one job offer, approximately 57% had taken part in an internship while 43% had not. In the same year, students who participated in internships received more full-time job offers compared with those who had no internship experience. Interestingly, 66.4% of the 2019 graduates who had paid internships received job offers while only 43.7% of graduates who had unpaid internships were offered jobs.[24] You can also reinforce your learning by teaching others what you have learned. Key Takeaway Learning and retention are dependent on memory. A number of factors are related to memories being encoded. Most people tend to have a preferred learning style. Visual learners prefer to see things to learn them. Auditory learners prefer to hear things to learn them. Kinesthetic learners prefer to do things to learn them. Learning techniques for students include effective notetaking, quizzing, and internships and practicums. What do you think? 1. What strategies do you normally use to help you learn new information? In what ways are they effective or ineffective? 2. What new ideas did you get from this section? How might you try them out? 3. Reflect on a time when you learned in a non-preferred learning style. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 21 22 Organizational Behavior 4. What are some challenges for learning remotely/online? 5. What are some opportunities for learning remotely/online? 1.4 Organizational Behavior Research Methods Learning Objectives 1. Learn the terminology of research. 2. Understand the different types of OB research methods used. 3. Understand different types of data. Research Concepts, Tools, and Approaches hypotheses Tentative guesses or hunches for an expected observation, phenomenon, or scientific problem that can be tested. variables Entities that can take on different values. OB researchers have many tools they use to discover how individuals, groups, and organizations behave. Researchers have working hypotheses based on their own observations, readings on the subject, and information from individuals within organizations. Based on these ideas, they set out to understand the relationships among different variables. There are a number of different research methods that researchers use, and we will discuss a few of these below. Imagine that your manager has asked you to find out if setting goals will help to make the employees at your company more productive. We will cover the different ways you could approach getting answers to your questions. Case Studies case studies In-depth descriptions of a single industry or company. Case studies are in-depth descriptions of a single industry or company. Case writers typically employ a systematic approach to gathering data and explaining an event or situation in great detail. The benefits of case studies are that they provide rich information for drawing conclusions about the circumstances and people involved in the topics studied. The downside is that it is sometimes difficult to generalize what worked in a single situation at a single organization with what might work in other situations and organizations. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work 23 Field Studies Field studies are those conducted in actual organizational settings with a population of workers. Most field studies involve surveying employees and managers working in organizations. At the same time, compelling evidence comes from field studies that employ an experimental design. Here you would assign half the employees at your company to the goal-setting condition and the other half to the control group condition. The control group wouldn’t get any information about goal setting, but the treatment group would. If you found that the treatment group was more effective than the control group, you could tell your boss that goal setting works. Laboratory Studies OB researchers are often interested in basic research questions such as “Can we show that goal setting increases performance on a simple task?” This is how research on goal setting started, and it is also how we can establish the conditions under which it works more or less effectively. Again, to address this, researchers may conduct a lab study, which is a study conducted in artificial situations outside of actual organizations. Lab studies usually follow an experimental design. You may even have been involved in a lab study during your time at your university. One of the most important concepts to understand with lab studies is that they give the researcher a great deal of control over the environment they are studying but do so in a less “realistic” way, since they are not studying real employees in real work settings. For example, in a lab study, a researcher might create an artificial job in which “employees” are paid for each T-shirt folded. Then the researcher can examine the effects of goal setting by setting a goal for the experimental group, and not setting goals in the control group, comparing the resulting performance levels. While such a study would be interesting for examining the effects of goal setting, it is a study on students acting as employees for a short period of time and therefore would give us limited information about whether goal setting would work in actual organizations. field studies Research conducted in actual organizations. They may include observation, interviews, surveys, or experiments. experimental design A study having a group that receives a treatment and a comparison group that receives no treatment. control group A group that does not receive any experimental manipulation so it can be compared to a treatment group. treatment group A group that receives experimental manipulation. lab study Research conducted under controlled conditions and may include observation, interviews, surveys, or experiments. Machine Learning You may have heard about machine learning lately. The idea behind machine learning is that as large amounts of data (Big Data) have become more readily available, traditional approaches to data analysis are not feasible. Machine learning algorithms generate models based on the available data and continue to update and adjust as new information is available. Machine learning may also be used to simulate what respondents might say or do. “It’s not magic,” Greg Corrado, a senior research scientist at Google, has said of machine learning. “It’s just a tool, but it’s a really important tool.” If you've ever used Netflix and noticed that it is suggesting things you might enjoy watching, you’ve experienced an example of machine learning applying an algorithm based on your viewing history and those of other viewers. Meta-Analysis Meta-analysis is a technique used by researchers to summarize what other researchers have found on a given topic. This analysis is based on taking observed correlations from multiple studies, weighting them by the number of observations in each study, and finding out if, overall, the effect holds or not. For example, what is the average relationship between job satisfaction and performance? Research shows that, looking across 300 studies, the relationship is moderately strong.[25] This is useful information because for years people had thought that the relationship did not exist, but when all the studies to date were examined together, the original beliefs about the satisfaction–performance relationship deteriorated. The advantage of meta-analysis is that it gives a more © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. meta-analysis The process of summarizing research findings from studies on related topics. 24 Organizational Behavior definitive answer to a question than a single study ever could. The downside is that meta-analysis is only possible if sufficient research has already been done on the topic in question. Surveys surveys Research tools used to elicit respondents’ reactions to specific questions. Surveys are one of the primary methods management researchers use to learn about OB. A basic survey involves asking individuals to respond to a number of questions. The questions can be openended or close-ended. An example of an open-ended question that could be used to address your manager’s question would be to ask employees how they feel about goal setting in relation to productivity, then summarize your findings. This might work if you have a small organization, but open-ended surveys can be time consuming to summarize and hard to interpret at a glance. You could get more specific by asking employees a series of close-ended questions for which you supply a response key, such as a rating on a scale of one to five. Today it is easy to create online surveys that quickly compile the results automatically. There are even several free survey tools available online or you can use paper-and-pencil surveys. Both approaches have pros and cons, but the key is to match your survey technique to the particular sample and research questions involved. Sample Survey About the Effectiveness of Goal Setting Instructions: We would like to gather your opinions about different aspects of work. Please answer the following three questions using the scale below: Response Scale: 1 = Strongly disagree; 2 = Disagree; 3 = Neither agree nor disagree; 4 = Agree; 5 = Strongly agree Setting goals at work helps me to focus 1 2 3 4 5 Goal setting is effective in improving performance 1 2 3 4 5 I get more done when I use goal setting 1 2 3 4 5 Regardless of the method you choose to collect your information, the next step is to look at the average of the responses to the questions and see how the responses stack up. But this still wouldn’t really answer the question your boss asked, which is whether using goal setting would help employees be more effective on the job. To do this, you would want to conduct a field study. Measurement Issues in OB reliability The consistency of measurement. validity The degree to which a measure captures what it intends to measure. Another important thing to understand is the difference between reliability and validity. Reliability refers to the consistency of measurement, whereas validity refers to whether the measure captures what it is expected to capture. Imagine that you are using a scale to measure how shy a person is. If the questionnaire is administered to the same person at three different times, you would expect the results to be very highly correlated with each other. If they are, that would mean that you have a reliable scale. This is because you would not expect people to have different levels of shyness at different times of the day, or from one day to the next. At the same time, if your measure includes questions about how much you like watching television, then your measure will have validity problems, given that both shy and outgoing people may enjoy watching television. A measure that is not reliable cannot be valid, so you can think of reliability as a necessary condition for validity. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work Finally, much of management research addresses correlations between two concepts rather than actual causation. Correlation simply means that two things co-vary, but correlation does not equal causation. For example, ice cream consumption and drowning tend to be correlated over time, but it would be inaccurate to assume that one causes the other. Instead, there is a third factor here that explains the observed correlation, which is the temperature. Ice cream and swimming pools tend to have more customers in summer months, explaining the observed correlation. Yet many people claim their product caused a positive outcome when, in fact, the data do not support their claim any more than the example above. This brings up something that confuses even seasoned researchers. As an aside, when you have only one observation it is called a datum. When you use the word data, it refers to multiple observations, so it is always plural. FIGURE 1.3 The Four V’s of Big Data The complexity and size of big data can be described according to four characteristics: volume, variety, velocity, and veracity. 25 correlations Measures the strength of the relationship between two variables. causation The act of making something happen. datum The term that refers to a single observation. data The term used to describe multiple observations and is always plural (as if you were using the word numbers). Big data refers to the volume, variety, velocity, and veracity, or validity, of the data. Companies like Facebook, Amazon, and Google track huge volumes of user and consumer data and use sophisticated algorithms to inform advertising and to predict what consumers will be interested in purchasing in the future based on their past browsing and shopping behavior.[26] While finance, marketing, and operations management functions have been using big data for awhile, for OB and Human Resource Management, it is a relatively new concept and researchers are grappling with the best approaches for aligning OB questions utilizing such large volumes and varieties of data. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. big data The volume, variety, velocity, and veracity, or validity, of data. 26 Organizational Behavior Analytics descriptive analytics Approaches focused on understanding what has already happened. predictive analytics What is likely to happen based on what we already know. In addition to research methods and measurement, it is important to understand the different analytics approaches to answering key OB questions. There are three approaches to analytics: descriptive analytics, which refer to approaches focused on understanding what has already happened, such as the average job satisfaction rating for employees from last year’s opinion survey; predictive analytics, which refer to what is likely to happen based on what we know already, such as guesses regarding this year’s upcoming opinion survey ratings for job satisfaction; and prescriptive analytics, which refer to focus on what should be done in the future based on what we know, such as specific evidence-based actions that might be taken to increase job satisfaction. prescriptive analytics A focus on what should be done in the future based on what we know. Key Takeaway OB researchers test hypotheses using different methods such as case studies, field studies, meta-analyses, machine learning, and surveys. Reliability refers to consistency of the measurement while validity refers to the underlying truth of the measurement. It is important to recognize the difference between correlation and causation. Data are the foundation of OB research methods. Big data refers to volume, variety, velocity, and the veracity of the data. Analytics may be descriptive, predictive, or prescriptive in nature. What do you think? 1. Create a hypothesis about people at work. Now that you have one in mind, which research method do you think would be most effective in helping you test your hypothesis? 2. Have you used any of the OB research methods before? If not, what can you do to become more familiar with them? 3. Give an example of a reliable measure. 4. Give an example of a valid measure. 5. How can you know if a relationship is causal or correlational? 6. Your boss asks you to see if job satisfaction is related to turnover and sends you data from the latest annual opinion survey, which was 10 months ago, and the turnover reports for the last six months. Which type of analytics will you use to answer this question? 1.5 Trends Influencing Organizational Behavior Learning Objectives 1. Understand current challenges for OB. 2. Understand current opportunities for OB. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work 27 Challenges and Opportunities There are many trends within the workplace and around the globe that have and will continue to affect the workplace and your career. We are sure you have noticed many of these trends simply by following the news. We will highlight some of these trends along with the challenges and opportunities they present for students of organizational behavior. Ethical Challenges Business ethics refers to applying ethical principles to situations that arise at work. It feels like it’s been one ethical scandal after the other in the business world. Wells Fargo, Facebook, Enron Corp., Samsung, WorldCom, and Halliburton Energy Services have all participated in activities that can be described in terms ranging from poor judgment to outright illegal behavior. The immediate response by government of ethical lapses within organizations was the Sarbanes-Oxley Act, which went into effect in 2002. This act consists of 11 specific requirements aimed at greater accountability, which companies must comply with in terms of financial reporting. Unfortunately, while there may be some benefit to businesses from complying with these rules,[27] few see this as the long-term solution to dealing with unethical behavior. The challenge is to continue to think about business ethics on a day-to-day basis and cultivate cultures that support ethical decision making. The opportunity for organizations to be at the forefront of ethical thinking and actions is wide open. OB research finds that the most important determinant of whether a company acts ethically is not necessarily related to the policies and rules regarding ethical conduct but instead whether it has a culture of consistently ethical behavior and if leaders are committed to this ethical behavior.[28] OB Toolbox: Take an Ethics-at-Work Audit Shutterstock.com • Do you integrate ethics into your day-to-day decisions at work? It’s easy to think about ethics as something big that you either have or don’t have, but the reality is that ethical decisions are made or not made each and every day. • Do you take the “front page” test when making important decisions at work? Thinking about how you would feel if the decisions you are making at work showed up on the front page of your local newspaper can help you avoid engaging in questionable behavior. • Do you role model ethics at work? Seeing others engage in unethical behavior is the start of a slippery slope when it comes to ethics. Consider the decisions you are making and how they are consistent or inconsistent with how you would like to be seen by others. • Do you consider if rewards are distributed ethically at work? Situations in which there are “haves” and “have nots” are breeding grounds for unethical behavior. Maintaining pay equity can help keep everyone more honest. • Have you held a “risk brainstorm” at work? If you ask those around you if they see any situations that are challenging ethical behavior, you can uncover some seriously risky situations and avoid them.[29] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. business ethics When ethical principles are applied to situations that arise at work. 28 Organizational Behavior Online Data Privacy Concerns In 2018, Equifax, a large credit report firm with access to social security numbers, addresses, and other data, revealed that up to 143 million Americans (a large percentage of individuals living in the country) had their personal information compromised. Shutterstock.com Another aspect of ethics relates to how data about individuals are used. Online data privacy concerns have become prevalent due to hacking, human error, and data scraping from social media and other websites becoming a major challenge for individuals and organizations alike, with 92% of companies surveyed reporting that data privacy and security are among their top concerns.[30] Data privacy refers to individuals’ control over the collection, storage, access, and reporting of their own personal data.[31] The issue of data privacy concerns became heightened in 2018 when the General Data Protection Regulation (GDPR) went into effect for all companies having a presence in a European Union (EU) country. This regulation states that for all of the EU’s 500 million citizens, they have the right to have their data “forgotten” and purged from online records. The penalties for violating this regulation are large, amounting to 4% of the company’s annual revenue or $20 million dollars, whichever is higher.[32] While new laws are beginning to regulate data privacy and provide greater protection for individuals, it remains a challenge. Individuals rarely read the terms and agreements when they create online accounts with companies and they are often willing to trade their privacy for convenience.[33] For example, the rise of “wearables” means that data exist regarding where you are with insights into what you are doing, which gives a great deal of information power to organizations. Lack of Employee Engagement employee engagement The degree to which employees are fully involved in and enthusiastic about their work. Studies suggest that fostering engagement, a concept related to passion, in employees has a significant impact on the corporate bottom line. Gallup, for instance, has been on the forefront of measuring the impact of what is called employee engagement. Employee engagement is a concept that is generally viewed as managing discretionary effort; that is, when employees have choices, they will act in a way that furthers their organization’s interests. An engaged employee is a person who is fully involved in and enthusiastic about their work. The consulting firm BlessingWhite offers this description of engagement and its value: “Engaged employees are not just committed. They are not just passionate or proud. They have a line-of-sight on their own future and on the organization’s mission and goals. They are ‘enthused’ and ‘in gear’ using their talents and discretionary effort to make a difference in their employer’s quest for sustainable business success.”[34] Engaged employees are those who are performing at the top of their abilities and happy about it. According to statistics that Gallup has drawn from 300,000 companies in its database, 87% of employees worldwide are not engaged at work. This is unfortunate on both a personal level for those employees and in terms of profitability as companies with highly engaged workforces outperform their peers by 146% in earnings per share.[35] In their global study of engagement, Gallup analyzed findings from nearly 82,000 business units across 49 industries and 73 countries and found that overall, engagement was related to higher profitability, productivity, sales, safety, and customer metrics as well as fewer quality defects, lower turnover, and lower absenteeism.[36] Job satisfaction studies in the United States routinely show job satisfaction ratings of 50%–70%. But one study of American workers by the American Psychological Association and Harris Interactive went a step further to understand what factors led to job satisfaction.[37] What did the researchers find? • Only 60% reported satisfaction with the growth and development opportunities offered. • Only 58% reported satisfaction with opportunities to be involved in decision making, problem solving, and goal setting at work. • Only 50% reported that their employer helps employees develop and maintain a healthy lifestyle. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work 29 Technology and Automation Technology has transformed the way work gets done and has created many great opportunities. This was further accelerated in 2020 during the COVID-19 pandemic, which led to a heavier reliance on technology and automation than ever before. The nexus of increasing personal computing power, the internet, and nanotechnology are allowing things to be created that weren’t even imaginable 60 years ago. And the rate of technological change is not expected to slow down anytime soon. Gordon Moore, a cofounder of Intel Corp., shocked the world in 1975 with what is now termed Moore’s Law, which states that computing power doubles every two years. This explains why a three-year-old computer can barely keep up with the latest video game you have purchased. As computers get faster, new software is written to capitalize on the increased computing power. We are also more connected by technology than ever before. For years it has been possible to send and receive emails or text messages with your coworkers and customers regardless of where in the world you are. There are more than 3.8 billion email accounts worldwide[38] and users around the world send over 293 billion emails every day.[39] Technology has also brought a great deal of challenges to individuals and organizations alike. To combat the overuse of email, companies such as Intel have experimented with ideas such as “no e-mail Fridays,” in which all communication is done via other communication channels. At the same time, a survey found that 37% of those surveyed worry about automation putting jobs at risk while 73% think technology can never replace the human mind.[40] The technology trend contains several challenges for organizational behavior. Uneven Information Quality Thomas Friedman’s book The World Is Flat: A Brief History of the Twenty-First Century makes the point that the internet has “flattened” the world and created an environment in which there is a more level playing field in terms of access to information. This access to information has led to an increase in innovation, as knowledge can be shared instantly across time zones and cultures. It has also created intense competition, as the speed of business is growing faster and faster all the time. There are few barriers to information today, which has created huge opportunities around the globe. Of course, information by itself is not as important as having the right information at the right time. A major challenge for individuals with such vast amounts of information is learning how to evaluate the quality of the information they find. As has become more and more apparent, access to information does not necessarily mean that the information is accurate. Thus, checking facts and reading source materials is more important than ever before. Santa Clara University helped establish The Trust Project, which seeks to identify indicators of trust for information.[41] These include the following eight factors related to higher trust in published information:[42] › Best Practices: What are your standards? Who funds the news outlet? What is the outlet’s mission? Plus commitments to ethics, diverse voices, accuracy, making corrections, and other standards. › Author Expertise: Who reported this? Details about the journalist who wrote the story, including expertise, and other stories they have worked on. › Type of Work: What am I reading? Labels to distinguish opinion, analysis, and advertiser (or sponsored) content from news reports. › Citations and References: For investigative or in-depth stories, greater access to the sources behind the facts and assertions. › Methods: Also for in-depth stories, information about why reporters chose to pursue a story and how they went about the process. › Locally Sourced: Lets people know when the story has local origin or expertise. › Diverse Voices: A newsroom’s efforts to bring in diverse perspectives. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Remote work became even more prevalent during the COVID-19 pandemic and is here to stay. While increasing flexibility, it is likely to increase work-family and family-work spillover and creates changes in many aspect of work life. Shutterstock.com 30 Organizational Behavior › Actionable Feedback: A newsroom’s efforts to engage the public’s help in setting coverage priorities, contributing to the reporting process, ensuring accuracy, and other areas. Sustainability and Green Business Practices triple bottom line Evaluating organizations against three performance criteria including economic, social, and environmental viability. sustainable business practices Practices that meet the current needs of businesses without compromising the needs of future generations. The primary role of for-profit companies is to generate shareholder wealth. More recently, the concept of the triple bottom line has been gaining popularity. Those subscribing to the triple bottom line believe that beyond economic viability, businesses need to perform well socially and environmentally. While some organizations have embraced the concepts underlying the triple bottom line, businesses are also undergoing a great deal of “greenwashing,” which refers to the marketing of products or processes as green to gain customers without truly engaging in sustainable business practices. Sustainable business practices are those that meet the present needs without compromising the needs of future generations. The challenge is to reconcile the accountability that publicly owned firms have in generating wealth for their shareholders while attending to the triple bottom line. On the other hand, organizations also have an opportunity to leverage a proactive stance toward innovative processes that can result in even greater profits for their products. For example, sales of the Toyota Prius, which combines combustion engine efficiency with hybrid electric technology, have been dramatic and have helped propel Toyota to record market share and profits and also spurred other companies to follow suit with their own hybrid offerings. An unlikely leader in the sustainability movement is Walmart. Walmart hired Adam Werbach, the former president of the Sierra Club, to help train 1.3 million North American Walmart employees about sustainability. This program was so successful that it was expanded across 80 countries. Walmart has also been pressuring suppliers to produce compact fluorescent lightbulbs with less mercury and has slashed the resources needed in packaging by requiring all suppliers to make packages smaller.[43] In the future, increasing interdependence between businesses, governmental agencies, notfor-profit organizations, and non-governmental organizations (NGOs) is bound to effect change throughout the economy.[44] In a compelling example of this, ReCORK was founded to annually divert some of the more than 13 billion used wine corks from landfills starting in 2007. By 2020, they had collected over 110 million corks.[45] In 2009 they partnered with SOLE, a Canadian footwear company that used the donated cork to make the soles of new shoes. Additional partners include the Aria resort and casino in Las Vegas and American Airlines, which gather and donate their used corks. Allbirds is a San Francisco-based company also seeking to create sustainable footwear. Their products are crafted with natural materials such as wool to make shoes with a smaller ecological footprint, and their business is booming.[46] Social responsibility is not just something organizations do at the price of profits. Toms operates as a for-profit company but also operates a nonprofit subsidiary called Friends of Toms, which is responsible for running a unique program. For every pair of shoes sold by Toms, a pair of shoes is donated to an impoverished child, with more than 75 million shoes donated in countries around the world. Aging Workforce You have probably heard that the American workforce is aging. Over the next 30 years, 76 million baby boomers will retire, but there will only be 46 million new workers from Generations X and Y entering the labor force. This demographic trend creates both challenges and opportunities for organizations. The aging trend has been predicted for decades. Near the turn of the century, it was predicted that the number of workers in the labor force aged 55 and older would grow from 13% in 2000 to 20% in 2020.[47] This prediction was actually fulfilled sooner than expected. In 2018, workers aged 55 and older comprised over 23% of the labor force.[48] There will be record numbers of retirements, © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work 31 with 10,000 baby boomers entering retirement age every day until 2029 when the last baby boomer will turn 65.[49] Aging workforces can create great opportunities for industries such as health care, but it can also mean great challenges lie ahead as entire industries related to basic infrastructure face massive retirement projections. For example, every job from air traffic controllers to truck drivers are predicted to be in huge demand as thousands of retiring workers leave these industries at roughly the same time.[50] FIGURE 1.4 Percentage of Labor Force by Age Group in 2018 compared to Projections for 2028 Source: U.S. Bureau of Labor Statistics. (2019, September 4). Civilian labor force, by age, sex, race, and ethnicity. Retrieved from https://www.bls.gov/emp/tables/civilian-labor-force-summary.htm Virtual Marketplace for Staffing You have probably heard of the gig economy, which consists of temporary, flexible jobs where organizations hire independent contractors instead of, or in addition to, full-time employees. Gig workers may work as a contractor for a single organization or they may work for several simultaneously. The number of contract workers at U.S. businesses in 2019 was over 18 million which is up 15% from 2010.[51] Some gig workers have other full-time jobs, some are seeking the flexibility of parttime employment, and yet others do not have other options. A key issue regarding a gig economy is the changing nature of the employment contract—both from a legal as well as attitudinal approach. For example, it is not unusual to see both Lyft and Uber signs and stickers on cars with drivers choosing which ride to pick up based on a variety of factors, indicating no particular attachment or loyalty to either organization. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. gig economy The prevalence of temporary employment positions where individuals are independent contractors rather than employees of organizations. 32 Organizational Behavior outsourcing An organization asking an outside organization to perform functions that could have been performed by itself. offshoring Refers to some or all of a business process being moved from one country to another country. Outsourcing has become a way of life for many organizations. Outsourcing refers to having someone outside the formal ongoing organization doing work previously handled in-house. An example of this is for a company to hire the services of a different firm to handle payroll and benefits, instead of having these administered within the company. Offshoring means sending jobs previously done in one country to another country. An example of offshoring is for a company to open a factory in Mexico to take advantage of lower cost of labor. Nowhere is there more outsourcing and offshoring than in the software technology industry. It was recently estimated that 43% of the companies in the United States outsource IT work. Some of the top countries identified for this work include Ukraine, Poland, India, China, Mexico, and Argentina.[52] Microsoft has been expanding their use of employees in Canada for a variety of reasons, such as closer proximity to Microsoft’s headquarters in Seattle, Washington, as well as similarity of language and time zones. With the advent of software automation and cloud computing, the interest in outsourcing is growing. In fact, 84% of executives surveyed by Deloitte indicated that they have either considered or implemented new outsourcing options.[53] The challenge for organizational behavior is managing teams consisting of different nationalities separated not only by culture and language but also in time and space as well as the fairness and equity issues associated with different types of employees working together over time. Key Takeaway Trends include ethical challenges, rapid technological change, a flattening world, sustainable business practices, demographic trends, and the virtual marketplace. A number of trends will influence the way work gets done today and in the future. Understanding organizational behavior will help you anticipate and adapt to these changes as a lifelong learner. What do you think? 1. Share an ethical dilemma you have observed at work or school to someone in your class. What do you think should have been done differently and why? 2. How has technology and the “flattening world” personally affected you in the last 10 years? Please share examples of this. 3. Do you think the sustainability movement in business is a trend that’s here to stay or a business fad? Explain. 4. Do you see the aging (and retiring) workforce as an opportunity or a threat for businesses? How do you think this will affect your career based on your own generation? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work 1.6 Employee Engagement in Organizational Change Toward B Corp Status: The Case of Brew Dr. Kombucha and Tea Sheila Fitzgerald/Shutterstock.com Brew Dr. Kombucha and Tea, formerly known as Townshend’s Tea Company, was founded in 2006 with the vision of creating a tea culture in the United States. In 2008, the company began producing kombucha (a beverage made out of fermented sweet tea) under the brand Brew Dr. Kombucha. While both brands, which are jointly operated, are growing, sales of Brew Dr. Kombucha account for the majority of the company’s business with a distribution network across the U.S., Canada, Mexico, and multiple countries in Europe. When it comes to tea, the company focuses on sustainable and fair practices. As their website notes about how they source their tea, “The world’s most meticulous and well-traveled tea buyers are able to form on-the-ground relationships with the families who farm and produce our teas. Each of them specializes in a particular region, and then imports the tea directly to us. Having a trusted partner directly at the source insures that not only are our teas abundantly flavorful, but that tea producers are treated fairly for their trade.” Since its inception, Brew Dr. Kombucha and Tea has emphasized community development and environmental sustainability as core components of its business model so much so that its management embraced the opportunity to formalize these principles through “B Corp certification.” B Corps are for-profit companies that are certified by the nonprofit B Lab if they meet rigorous standards of social and environmental performance, accountability, and transparency; they strive to use the power of markets to help solve social and environmental problems. Certification is recognition of a philosophy and actions taken by any organization regardless of how it is formed. It is voluntary and can be changed at any time. Over 2,000 Certified B Corps exist in 50 countries in 130 industries. Many of these companies are small- to medium-sized organizations, which is where much of the growth in this type of company has emerged. Certification is independent, third-party, and consists of an application of 170 questions covering such aspects of the business as energy efficiency and employee programs and practices. A total of 200 points is possible, but the certification does not expect that any company will ever be able to achieve a perfect score. In fact, a score of 80 points is enough to become certified. Notable companies with B Corp certification include Ben & Jerry’s (the first wholly owned subsidiary to become certified) and Kickstarter. Natura, a Brazilian cosmetics company, became the first publicly traded Certified B Corp in 2014. Beyond those companies that formally apply for certification, over 40,000 organizations use the free self-assessment tool available at http://bimpactassessment.net to help them benchmark their social and environmental impact. Upon initially completing the impact assessment in early 2017, Brew Dr. Kombucha and Tea was just shy of meeting the performance requirement set forth by B Lab to become certified. The responsibilities associated with completing the first assessment had fallen on two members of the management team. To ensure broader organizational buy-in, as well as accuracy in completing © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 33 34 Organizational Behavior the assessment, Brew Dr. Kombucha and Tea convened a team of nearly 30 employees to conduct a comprehensive review of the impact assessment in late 2017. This self-selected group of employees was organized into subcommittees focused on the four B Corp impact areas: governance, workers, community, and environment. Employees were assigned a question or questions from their respective impact areas to review in greater detail. They were then tasked with providing recommendations around operational changes that would lead to an improved impact assessment score. The number of employees who volunteered to assist with this project and the enthusiasm with which they approached the project was a testament to Brew Dr. Kombucha and Tea’s culture of transparency and participation. Each employee who volunteered was passionate about building upon the values they had come to appreciate in their organization and reinforcing them by formalizing previously informal processes and procedures. For example, in developing an Environmentally Sustainable Purchasing Policy, a member of the environment subcommittee sought to set a standard of sustainable procurement of goods and demonstrate the company’s commitment to environmental, economic, and social stewardship by providing employees with clear and consistent instructions on how to consider and purchase supplies and services. Previously, employees had been encouraged to purchase sustainable alternatives when given the option, but no policy had been created to ensure this was the norm. Thus the pursuit of B Corp certification provided a unique opportunity to embed some of these behaviors into the DNA of the company to ensure continued alignment with founding values as the company grows. Brew Dr. Kombucha and Tea provides one example of organizational change inspired by a desire to formally adhere to principles of sustainability and social good. The changes were made even more meaningful by the inclusion of its employees in the assessment and implementation processes. Moreover, the employees tasked with driving this organizational change were motivated by the potential to establish a framework under which the company could grow ethically and responsibly for generations of employees to come.[54] Multimedia Extension—B Corporation Founders Video View in the online reader Case Discussion Questions 1. If you were a Brew Dr. employee, would you have volunteered to assist with the B Corp assessment? Why or why not? 2. What are some pros and cons of including employees in organizational change management? 3. Can you think of some ways the pursuit of B Corp certification might lead to organizational change, even for a company that already embodies sustainability and social good? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 1 Organizational Behavior at Work 4. Imagine that you are a manager at a young and rapidly growing company like Brew Dr., and you are interested in acquiring a B Corp certification for your firm. How would you go about implementing any necessary change? What steps would you follow before, during, and after the change? 5. How do you think the pursuit of B Corp certification might impact an organization’s bottom line? Please explain. 1.7 Conclusion This chapter is designed to familiarize you with the concept of organizational behavior. We have covered methods organizations might use to address issues related to the way people behave at work. In addition, you should now be familiar with the large number of factors, both within an individual and within the environment, that may influence a person’s behaviors and attitudes. In the coming years, society is likely to see a major shift in the way organizations function, resulting from rapid technological advances, social awareness, and cultural blending. OB studies hope to enhance an organization’s ability to cope with these issues and create an environment that is mutually beneficial to the company as well as its employees. 1.8 Exercises Individual Exercises Create an Action Plan for Developing Your OB Skills 1. Hopefully you have already completed reading this chapter. If not, wait until you’ve done so to complete this individual exercise. 2. In addition, please be sure you have reviewed the table of contents for this organizational behavior textbook. 3. What themes do you see? How do you think these topics affect your interactions with others? How might the information on learning and retention affect how you’ll approach this course? Studying in general? 4. Now, write down five action steps that you plan to take as you work through this book. Refer to these steps throughout the term and modify them as needed. Group Exercises Best Job–Worst Job 1. Think about the best and worst jobs you have ever had. If you have never had a job, think of a school project instead. What made the job or project great or horrible? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 35 36 Organizational Behavior 2. Next, get into a small group of students and share your experience with them. 3. Listen to what others are saying and see if any themes emerge. For example, what are the most common features of the best jobs? What are the most common features of the worst jobs? Endnotes 1. Case written by Talya Bauer and Berrin Erdogan to accompany Bauer, T. N., & Erdogan, B. (2021). Organizational Behavior: Bridging Science and Practice (4.0). Boston, MA: FlatWorld. Partially based on ideas and information contained in Martin, M. (2019). Women share how to lead with purpose at Skift Travel Forum. Forbes. https://www.forbes.com/sites/ michellemartin/2019/10/07/women-share-how-to-lead-with-purpose-atskift-travel-forum/#11c7c7a49122; Sustainability leaders project. https://sustainability-leaders.com/hans-pfister-interview/?fbclid=IwAR2u0_N53y1WmeIFWnLclzr0auJeuMfX2zMb1FCkHB3R-u3h51TZ6ecz33U; Should we all stop flying on vacation? https://www.cayugacollection.com/should-we-all-stopflying-on-vacation/; Cayuga Collection. (2019). A little ingenuity goes a long way. Retrieved from https://www.cayugacollection.com/sustainability/; Zueras, D. (2020). Andrea Bonilla, la tica que apuesta al ecoturismo de lujo con Cayuga Collection. E&N. Retrieved from https://www.estrategiaynegocios.net/centroamericaymundo/1351891-330/andrea-bonilla-latica-que-apuesta-al-ecoturismo-de-lujo-con-cayuga 2. Kirkpatrick, D. (1998). The second coming of Apple. Fortune, 138, 90. 3. Mello, T. (2020). How Tim Cook motivates his team in under a minute. Inc. Retrieved from https://www.inc.com/tommy-mello/how-tim-cook-motivates-his-team-in-under-a-minute.html 4. U.S. Bureau of Labor Statistics. (2017). Number of jobs held, labor market activity, and earnings growth among the youngest baby boomers: Results from a longitudinal survey. Retrieved June 1, 2018 from www.bls.gov/ news.release/pdf/nlsoy.pdf. 5. Gibson, E. (2008, March 1). Meg Whitman’s 10th anniversary as CEO of eBay. Fast Company. Retrieved from https://www.fastcompany.com/ 703037/nowmarch-2008?utm_source=postup&utm_medium=email&utm_campaign=issue-123&position=17&partner=newsletter&campaign_date=07292019 6. Forbes. (2020, May 14). Retrieved from https://www.forbes.com/companies/ebay/#29b79198774e 7. NACE. (2020, January 13). Key attributes employers want to see on students’ resumes. Retrieved from https://www.naceweb.org/talent-acquisition/candidate-selection/key-attributes-employers-want-to-see-on-students-resumes/ 8. Huselid, M. A. (1995). The impact of human resource management practices on turnover, productivity, and corporate financial performance. Academy of Management Journal, 38, 635-672; Pfeffer, J. (1998). The human equation: Building profits by putting people first. Boston: Harvard Business School Press; Pfeffer, J., & Veiga, J. F. (1999). Putting people first for organizational success. Academy of Management Executive, 13, 37–48; Welbourne, T., & Andrews, A. (1996). Predicting performance of Initial Public Offering firms: Should HRM be in the equation? Academy of Management Journal, 39, 910–911. 9. Pfeffer, J., & Veiga, J. F. (1999). Putting people first for organizational success. Academy of Management Executive, 13, 37–48; Kim, Y., & Ployhart, R. E. (2014). The effects of staffing and training on firm productivity and profit growth before, during, and after the Great Recession. Journal of Applied Psychology, 99, 361-389. 10. Wigert, B., & Harter, J. (2017). Re-engineering performance management. Gallup. Retrieved from https://www.gallup.com/workplace/238064/reengineering-performance-management.aspx 11. Adapted from ideas contained in Tom Peters, "Brand you survival kit," FastCompany. Retrieved from http://www.fastcompany.com/magazine/83/playbook.html; Meghan M. Biro, "5 steps to empowering the brand you," Forbes. Retrieved from http://www.forbes.com/sites/ meghanbiro/2013/02/24/5-steps-to-empowering-the-brand-you/ 12. Michaels, E., Handfield-Jones, H., & Axelrod, B. (2001). The war for talent. Boston: Harvard Business School Publishing. 13. U.S. Bureau of Labor Statistics (2016). Unemployment and earnings rate by educational attainment. http://www.bls.gov/emp/ep_chart_001.htm. 14. Weiss, H. M. (1990). Learning theory and industrial psychology. In M. D. Dunnette & L. M. Hough (Eds.), Handbook of Industrial and Organizational Psychology. Palo Alto, CA: Consulting Psychologist Press. 15. Colquitt, J. A., LePine, J. A., & Noe, R. A. (2000). Toward an integrative theory of training motivation: a meta-analytic path analysis of 20 years of research. Journal of Applied Psychology, 85, 678-707. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 16. Gunter, D. R., Beege, M., Nebel, S., Wirzberg, M., Schmitt, T. H., & Schneider, S. (2019). A meta-analysis of the segmenting effect. Educational Psychology Review, 31, 389-419. 17. Federal Bureau of Investigation (2011). Retrieved from http://www.fbi.gov/ stats-services/publications/bank-crime-statistics-2011/bank-crime-statistics-2011. 18. Bell, B. S., Tannenbaum, S. I., Ford, J. K., Noe, R. A., & Kraiger, K. (2017). 100 years of training and development research: What we know and where we should go. Journal of Applied Psychology, 102, 305-323; Salas, E., Tannenbaum, S. I., Kraiger, K., & Smith-Jentsch, K. A. (2012). The science of training and development in organizations: What matters in practice. Psychological Science in the Public Interest, 13, 74-101. 19. Rogowsky, B. A., Calhoun, B. M., & Tallal, P. (2015). Matching learning style to instructional method: Effects on comprehension. Journal of Educational Psychology, 107, 64; Willingham, D. T., Hughes, E. M., & Dobolyi, D. G. (2015). The scientific status of learning styles theories. Teaching of Psychology, 42, 266-271. 20. Peverly, S. T., Brobst, K. E., Graham, M., & Shaw, R. (2003). College adults are not good at self-regulation: A study on the relationship of selfregulation, note taking, and test taking. Journal of Educational Psychology, 95, 335–346. 21. Muellter, P. A., & Oppenheimer, D. M. (2014). The pen is mightier than the keyboard: Advantages of longhand over laptop note taking. Psychological Science, 29, 1565-1568. 22. Luo, L., Kiewra, K. A., Flanigan, A. E., & Peteranetz, M. S. (2018). Laptop versus longhand note taking: effects on lecture notes and achievement. Instructional Science, 46, 947-971. 23. Miyatsu, T., Nguyen, K., & McDaniel, M. A. (2018). Five popular study strategies: Their pitfalls and optimal implementations. Perspectives on Psychological Science, 13, 390-407. 24. NACE. (2019, May 13). Job offers for class of 2019 grads impacted by internship experience. Retrieved from https://www.naceweb.org/job-market/trends-and-predictions/job-offers-for-class-of-2019-grads-impactedby-internship-experience/ 25. Judge, T. A., Thoresen, C. J., Bono, J. E., & Patton, G. K. (2001). The job satisfaction-job performance relationship: A qualitative and quantitative review. Psychological Bulletin, 127, 376–407. 26. Aziza, B. (2018). Big data: Amazon, Google, Microsoft, the cloud and other 2018 trends. Forbes. Retrieved from https://www.forbes.com/sites/ciocentral/2018/01/08/big-data-amazon-google-microsoft-the-cloud-andother-2018-trends/#539c02172ba1 27. Wagner, S., & Dittmar, L. (2006, April). The unexpected benefits of Sarbanes-Oxley. Harvard Business Review, 84, 133–140. 28. Driscoll, K., & McKee, M. (2007). Restoring a culture of ethical and spiritual values: A role for leader storytelling. Journal of Business Ethics, 73, 205–217. 29. Adapted from ideas in David Callahan, The cheating culture: Why more Americans are doing wrong to get ahead (New York: Harcourt Books, 2004); Barbara Ley Toffler, "Five ways to jump-start your company’s ethics," Fast Company, accessed June 1, 2018, http://www.fastcompany.com/magazine/75/5ways.html; Linda Trevino, Gary Weaver, and Scott J. Reynolds, "Behavioral ethics in organizations: A review," Journal of Management, 32, (2006): 951–990. 30. PwC (2017). Pulse survey: US companies ramping up General Data Protection Regulation (GDPR) budgets. Retrieved June 25, 2020, from https://www.pwc.com/us/en/increasing-it-effectiveness/publications/ assets/pwc-gdpr-series-pulse-survey.pdf 31. Stone, E. F., & Stone, D. L. (1990). Privacy in organizations: Theoretical issues, research findings, and protection mechanisms. Research in Personnel and Human Resources Management, 8, 349-411. 32. Fontana, J. (2016). Tough new privacy laws in EU could signal global changes. ZDNet. Retrieved from http://www.zdnet.com/article/toughnew-privacy-laws-in-eu-could-signal-global-changes/ 33. Berreby, D. (2017). Click to agree with what? No one reads terms of service, studies confirm. The Guardian. Retrieved from https://www.theguardian.com/technology/2017/mar/03/terms-of-service-online-contracts-fine-print 34. BlessingWhite. (2013). Employee engagement report. Retrieved from http://www.blessingwhite.com/content/reports/BlessingWhite_Employee_Engagement_Research_Report_2013.pdf 35. Gallup (2018). The engaged workplace. Retrieved from http://www.gallup.com/services/190118/engaged-workplace.aspx 36. Gallup. (2017). State of the American workplace. Retrieved from https://www.gallup.com/workplace/238085/state-american-workplacereport-2017.aspx Chapter 1 Organizational Behavior at Work 37. APA (2017). 2017 Work and well-being survey. http://www.apaexcellence.org/assets/general/2017-work-and-wellbeing-survey-results.pdf ; APA (2017). Change at work linked to employee stress, distrust and intent to quit, new survey finds. Retrieved from https://www.apa.org/news/ press/releases/2017/05/employee-stress.aspx 38. Campaign Monitor. (n.d.) How many people in the world use email? Retrieved from https://www.campaignmonitor.com/resources/knowledge-base/how-many-people-in-the-world-use-email/#:~:text=Email usage is actually still,the global population uses email. 39. Lifewire. (2020, March 15). 19 fascinating email facts. Retrieved from https://www.lifewire.com/how-many-emails-are-sent-every-day-1171210 40. PwC (2018). Workforce of the future: The competing forces shaping 2030. Retrieved from https://www.pwc.com/gx/en/services/people-organisation/publications/workforce-of-the-future.html 41. Lehrman, S., & Vincent, S. (2018). The Trust Project. Retrieved from https://www.scu.edu/ethics/focus-areas/journalism-ethics/programs/the-trust-project/ 42. These eight indicator are taken verbatim from Saum, S. B., & Lohse, D. (2018). Trust me. Santa Clara Magazine. Retrieved from http://magazine.scu.edu/scm/spring2018/features.cfm?b=439&c=24268 43. Fetterman, W. (2006). Wal-Mart grows “green” strategies. USA Today. Retrieved from http://www.usatoday.com/money/industries/retail/ 2006-09-24- wal-mart-cover-usat_x.htm; Sacks, D. (2007, December 19). Working with the enemy. Fast Company. Retrieved from http://www.fastcompany.com/magazine/118/working-with-the-enemy.html; Taggart, A. (2013). Adam Werbach: The future of sustainable business. Retrieved from http://www.peakprosperity.com/podcast/80862/adam-werbach-2-9-13. 44. Campbell, J. L. (2007). Why would corporations behave in socially responsible ways? An institutional theory of corporate social responsibility. Academy of Management Review, 32, 946–967; Etzion, D. (2007). Research on organizations and the natural environment, 1992–present: A review. Journal of Management, 33, 637–664. 45. ReCork. (2020). Retrieved from https://recork.com/us/en/how-itworks#:~:text=Drink Every year, the equivalent,collect to make new items. 46. Allbirds (2018). Mother nature made us do it. Retrieved from https://www.allbirds.com/pages/our-story 47. Mosner, E., Spiezle, C., & Emerman, J. (2004). The convergence of the aging workforce and accessible technology: The implications for commerce, business, and policy (Microsoft white paper). 37 48. U.S. Bureau of Labor Statistics. (2019, September 4). Civilian labor force, by age, sex, race, and ethnicity. Retrieved June 26, 2020, from https://www.bls.gov/emp/tables/civilian-labor-force-summary.htm 49. "Baby boomers retire," Pew Research Center, accessed http://www.pewresearch.org/daily-number/baby-boomers-retire/. 50. "Baby boomers retire," Pew Research Center, accessed http://www.pewresearch.org/daily-number/baby-boomers-retire/. Ewart, H. (2008, April 29). Female truckies needed amid driver shortage. Retrieved from http://www.abc.net.au/news/stories/2008/04/29/ 2229837.htm; Watson, B. (2008, January 30). Aviation. Retrieved from the MSNBC Web site: http://www.msnbc.msn.com/id/22917202/. 51. Iacurci, G. (2020). The gig economy has ballooned by 6 million people since 2010. CNBC. https://www.cnbc.com/2020/02/04/gig-economygrows-15percent-over-past-decade-adp-report.html 52. Tafoya, F. (2019, August 28). Where do U.S. companies outsource software development? iTexico. Retrieved from https://www.itexico.com/ blog/where-do-u.s.-companies-outsource-software-development 53. Deloitte. (2018). The Deloitte global outsourcing survey 2018. Retrieved from https://www2.deloitte.com/us/en/pages/operations/articles/globaloutsourcing-survey.html# 54. Case written by Talya Bauer, Berrin Erdogan, and Rachel Mattenberger to accompany Talya Bauer and Berrin Erdogan, Organizational Behavior: Bridging Science and Practice (4.0). Boston, MA: FlatWorld. Partially based on ideas and information contained in Goodman, M. (2013). Make it good officially. Entrepreneur. Retrieved from http://www.bcorporation.net/ sites/default/files/Entrepreneur_Mag_Feature.pdf; Freeland, C. (2013). Capitalism, but with a little heart. The New York Times. Retrieved from http://www.nytimes.com/2013/07/19/us/19iht-letter19.html?_r=0; Why B Corps Matter. Retrieved from http://www.bcorporation.net/what-are-bcorps/why-b-corps-matter; B Corps. Our history. Retrieved from http://www.bcorporation.net/what-are-b-corps/the-non-profit-behind-bcorps/our-history; Honeyman, R. (2014). The B Corp Handbook: How to Use Business as a Force for Good; Brew Dr. Kombucha. (2020). Wholesale. Retrieved from https://www.brewdrkombucha.com/wholesale-kombucha/ © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 38 Organizational Behavior © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. CHAPTER 2 Diversity and Inclusion at Work Shutterstock.com Learning Objectives After reading this chapter, you should be able to do the following: 1. Understand the difference between diversity and inclusion. 2. Explain the benefits of diversity and inclusion. 3. Describe potential barriers to achieving diversity and inclusion. 4. Describe the challenges and opportunities related to managing a multicultural workforce. 5. Understand connections between diversity and inclusion at work and ethics, technology, and cross-cultural management. Globally, the workforce is increasingly diverse. Countries differ when it comes to how diverse workplaces are. For example, in 2020, women constituted 46% of the workforce in the United States, 7.7% in Yemen, and 52.1% in Mozambique.[1] Further, 12.6% of the U.S. workforce is Black, 17.5% is of Hispanic origin, and 6.3% is Asian.[2] Employees continue to work beyond retirement, introducing age diversity to the workforce. Regardless of your gender, race, and age, you will need to work with, communicate with, and understand people different from you at school as well as at work. Understanding cultures different from your own is also becoming increasingly important due to the globalization of business. In the United States, 17.4% of domestic employees were foreign-born, indicating that even those of us who are not directly involved in international business may benefit from developing an appreciation for the differences and similarities between cultures.[3] In this © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 40 Organizational Behavior chapter, we examine particular benefits and challenges of managing a diverse workforce and discuss ways in which you can increase your effectiveness when working with diversity. As we discuss differing environments faced by employees with different demographic traits, we primarily concentrate on the legal environment in the United States. Note that the way in which demographic diversity is treated legally and socially varies around the globe. For example, countries such as Canada and the United Kingdom have their own versions of equal employment legislation. Moreover, how women, employees of different races, older employees, employees with disabilities, employees of different religions, employees with disabilities, and LGBTQ employees are viewed and treated shows much variation based on the societal context. 2.1 Open to All and Color Proud: The Case of Gap Inc. TY Lim/Shutterstock.com The San Francisco, California based Gap Inc. is a clothing giant, with over 3,500 locations in 90 countries, supported by 129,000 employees. The company owns well-known brands such as Banana Republic, Old Navy, Athleta, as well as Gap, and is a leader in casual men’s, women’s, and children’s clothing. Gap was ranked by Newsweek as one of America’s most responsible companies in 2020 for their commitment to doing good and giving back to their communities. Founded over 50 years ago, the company regards its prosocial values as the key to the way the business is run. Diversity and inclusion are high among these values. For example, in 2018, the company signed the “Open to All” business pledge affirming that it would treat customers, employees, and suppliers with dignity and respect, and it would provide a welcoming and safe environment to all regardless of sex, sexual orientation, national origin, race, ethnicity, religion, and disability. Gap was named one of the world’s most diverse and inclusive companies in 2018 and 2019, ranking among the top 10 in both years. For a business catering to a diverse customer base, diversity and inclusion is critical to the bottom line of the business. As a case in point, Gucci received backlash after a design resembling blackface on a sweater. Similarly, Prada came under fire when they started selling keychains that resembled racist caricatures. It is no accident that Gap seems to avoid such missteps and fiascos. In 2018, the company formed the Color Proud Council consisting of 45 employees charged with being present in all phases of a collection’s creation. The council makes sure that marketing, merchandising, and hiring decisions are inclusive. One of their success stories is Banana Republic’s “True Hues” collection consisting of skin colored clothing. The involvement of Color Proud Council ensured that the collection was inclusive of all skin tones, with the sales significantly beating expectations. The company uses a number of different strategies to foster diversity and inclusion. Be One Get One (BOGO) is a mentoring program aimed at developing careers of employees. The company fosters a number of different employee resource networks, such as Asians Supporting Inclusion © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work and Awareness (ASIA), Gap Parents, and Women in Leadership (GAPWIL). The leadership team is split evenly between men and women, but there is room to improve. For example, Michele Nyrop, Chief People Officer, noted that Banana Republic moved its creative department from New York to San Francisco, which allowed them to build their team of 200 from the ground up, resulting in greater levels of diversity in their design team. In another program aimed at diversifying entry level workers called “This Way Ahead,” Gap hires young adults (those between 16–24 years old) in low income neighborhoods. Applicants are selected based on their potential as opposed to past work experience, and are provided with a job coach who will show them the way and help them get integrated into the business.[4] Despite its highly visible efforts to create an inclusive workplace, Gap’s reputation in labor relations is far from spotless and shows much need for improvement. For example, in 2007, the company admitted to having inadvertently used child labor in their subcontracted production lines produced in India. Further, in 2018, a report by Global Labor Justice revealed that female workers in their Asian factories were subject to gender-based violence and abuse, with the company agreeing to investigate the issue. These examples point to the importance of infusing domestic diversity goals and initiatives into all aspects of one’s business, particularly because of the necessity to manage a global supply chain ethically. [5] Multimedia Extension—A Culture of Equality View in the online reader Case Discussion Questions 1. What do you think are the stated and unstated reason’s for Gap’s commitment to diversity and inclusion? 2. The case described Open to All, Color Proud, mentoring, employee resource networks, and This Way Ahead as some of the specific ways in which Gap manages diversity. What are your thoughts about these practices? How resource intense are they? How useful do you believe they would be in businesses in other industries? 3. How important do you think Gap’s diversity and inclusion practices are in regard to hiring and retaining its workforce? 4. In your opinion, to what extent does Gap’s influence extend beyond the boundaries of the organization to impact change in the world? 5. Gap Inc. has set a high bar for proactively cultivating a culture of diversity and inclusion and yet there are instances where these goals were not universally met, particularly in their global operations. How do you reconcile the company’s domestic efforts with the labor relations problems it encounters as part of its global supply chain? What is Gap’s obligation to address these concerns? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 41 42 Organizational Behavior 2.2 Demographic Diversity and Inclusion Learning Objectives 1. Explain the benefits of diversity and inclusion. 2. Explain the challenges of diversity management. 3. Describe the unique environment facing employees with specific traits such as sex, race, religion, disabilities, age, sexual orientation, and gender identity. diversity Compositional differences among people in a work unit. Diversity refers to compositional differences among people in a work unit.[6] These differences lead people to perceive others as similar to or different from themselves. Diversity may be defined by any characteristic that varies within a particular work unit such as gender, race, age, education, tenure, or functional background (such as being an engineer versus being an accountant). In this chapter, our focus will be on diversity with respect to demographic, relatively stable, and visible characteristics: specifically race, sex, age, religion, disabilities, sexual orientation, and gender identity. Understanding how these characteristics affect organizational behavior is important. While many organizations publicly rave about the benefits of diversity, many find it challenging to develop an inclusive culture. This is evidenced by the number of complaints filed with the Equal Employment Opportunity Commission (EEOC) regarding discrimination. In the United States, the Age Discrimination Act of 1975 and Title VII of the Civil Rights Act of 1964 outlaw discrimination based on age, gender, race, national origin, or religion. The 1990 Americans with Disabilities Act prohibits discrimination against employees based on physical or mental disabilities who are able to perform the essential aspects of their jobs with or without accommodations. In 2019, over 72,000 individuals filed a complaint claiming that they were discriminated against based on protected characteristics.[7] Of course, this number represents only the most extreme instances in which victims must have received visibly discriminatory treatment to justify filing a complaint. It is reasonable to assume that many instances of discrimination go unreported because they are more subtle and employees may not even be aware of inconsistencies such as pay discrimination. It seems that there is room for improvement when it comes to benefiting from diversity, understanding its pitfalls, and creating a work environment where people feel appreciated for their contributions regardless of who they are. Benefits of Diversity and Inclusion Effective management of diversity is simply the right thing to do. Diversity is also a fact of organizational life, and it is here to stay. The talent organizations need is diverse in race, age, sex, gender identity, religion, disability status, and any other number of dimensions. What are the benefits of diversity for groups and organizations? Research examining diversity in isolation (without considering it along with inclusion), actually paints a nuanced picture. Groups that are diverse tend to experience lower levels of cohesiveness, higher levels of conflict, lower levels of team performance, and higher levels of turnover. Human beings find it easier to communicate with each other when they interact with others who are similar. In other words, increasing levels of diversity are not always followed by desirable outcomes for organizations. [8] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work At the same time, when examined along with inclusion, the potential benefits of diversity emerge. Inclusion involves allowing individuals to bring aspects of themselves that make them unique to a group, while also being treated as organizational insiders. Inclusive organizations ensure that all individuals are allowed to participate in the organizational life fully, their voices are heard, and concerted efforts are made to remove barriers to the fair treatment of everyone.[9] Research has shown that a climate of inclusion is necessary to turn diversity into an advantage for organizations.[10] Thus, it is important to consider diversity and inclusion together: Simply having diversity does not mean that the organization is inclusive, and without inclusiveness, diversity is not sufficient to yield positive outcomes. As diversity consultant and advocate Verna Myers notes, “Diversity is being invited to the party. Inclusion is being asked to dance.”[11] In the next section, we summarize potential benefits of diversity and inclusion. So, when discussing benefits of diversity, we need to treat diversity as a necessary first step, but insufficient without inclusion. 43 inclusion The degree to which individuals can bring the aspects of themselves that make them unique while also being treated as insiders. Higher Creativity in Decision Making An important potential benefit of having a diverse workforce is the ability to make higher quality decisions. In a diverse work team, people will have different opinions and perspectives. In these teams, individuals are more likely to consider more alternatives and think outside the box when making decisions. When thinking about a problem, team members may identify novel solutions. Research shows that teams that are diverse with respect to values, thinking styles, knowledge, skills, and beliefs stimulate creativity in members.[12] Therefore, having a diverse workforce may have a direct impact on a company’s bottom line by increasing creativity in decision making. Better Understanding and Service of Customers A company with a diverse workforce may create products or services that appeal to a broader customer base. PepsiCo Inc. planned and executed a successful diversification effort in the recent past. The company was able to increase the percentage of women and ethnic minorities in many levels of the company, including management. The company points out that in some years, about 1% of the company’s 8% revenue growth came from products that were inspired by the diversity efforts, such as guacamole-flavored Doritos chips and wasabi-flavored snacks.[13] Companies with more women have been responsible for introducing innovative ideas to the market, such as the online subscription and personal shopping service Stitch Fix. On a negative note, companies lacking diversity often introduce products that do not meet the needs of a particular segment of the population. For example, when Apple first introduced its Health app, the company came under fire for enabling users to track a wide variety of metrics including sodium intake and yet somehow failing to include metrics relating to reproductive health. Similarly, the early failure of voice recognition software to recognize female voices or image recognition software failing to recognize Black faces has been attributed to the lack of diversity in the technology industry.[14] A company with a diverse workforce may understand the needs of particular groups of customers better, and customers may feel more at ease when they are dealing with a company that understands their needs. Higher Job Satisfaction When employees feel that they are fairly treated, they tend to be more satisfied. On the other hand, when employees perceive that they are being discriminated against, they tend to be less attached to the company, less satisfied with their jobs, and experience more stress at work.[15] Organizations where employees are satisfied often have lower turnover. Organizational practices aimed at creating a diverse and inclusive culture help employees to develop trust in the organization and management, and have been shown to have advantages in facilitating employee engagement.[16] In © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Research shows that diverse teams tend to make higher quality decisions. Shutterstock.com 44 Organizational Behavior contrast, in organizations where people experience or observe discrimination, employees suffer from higher levels of stress and experience a sense of injustice, resulting in more negative outcomes.[17] Higher Stock Prices Companies that do a better job of creating and managing a diverse workforce are often rewarded in the stock market, indicating that investors use this information to judge how well a company is being managed. For example, companies that have greater levels of gender diversity in their board of directors have been shown to have higher stock returns following the initial public offering (IPO) of their stocks.[18] Further, companies that receive an award from the U.S. Department of Labor for their diversity management programs show increases in their stock price in the days following the announcement. Conversely, companies that announce settlements for discrimination lawsuits often show a decline in stock prices afterward.[19] Lower Litigation Expenses Companies doing a particularly bad job in diversity management face costly litigations. When an employee or a group of employees feel that the company is violating EEOC laws, they may file a complaint. The EEOC acts as a mediator between the company and the person, and the company may choose to settle the case outside the court. If no settlement is reached, the EEOC may sue the company on behalf of the complainant or may provide the injured party with a right-to-sue letter. Regardless of the outcome, these lawsuits are expensive and include attorney fees as well as the cost of the settlement or judgment, which may reach millions of dollars. The resulting poor publicity also has a cost to the company. For example, in 2018, the Seasons 52 restaurant, which is a brand owned by Darden Restaurants, was ordered to pay $2.85 million in an age discrimination lawsuit. The company had told applicants denied employment that they had too much experience, and that they were looking for “fresh” employees. In the same year, Ford was ordered to pay an ex-engineer of Arab descent $16.8 million due to harassment and creation of a hostile work environment.[20] As you can see, effective management of diversity can lead to big cost savings by decreasing the probability of facing costly and embarrassing lawsuits. Higher Company Performance As a result of all these potential benefits, companies that manage diversity more effectively tend to outperform others. Research shows that in companies pursuing a growth strategy, there was a positive relationship between racial diversity of the company and firm performance.[21] Companies ranked in the Diversity 50 list created by DiversityInc magazine performed better than their counterparts.[22] And, in a survey of 500 large companies, those with the largest percentage of female executives performed better than those with the smallest percentage of female executives. Of course, correlation does not equal causation, and it is possible that the causal arrow goes the other way and strong organizations have the bandwidth to invest in diversity initiatives. The relationship, however, remains.[23] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work 45 Challenges to Achieving Diversity and Inclusion If managing diversity effectively has the potential to increase company performance, increase creativity, and create a more satisfied workforce, why aren’t all companies doing a better job of encouraging diversity? Despite all the potential advantages, there are also a number of challenges associated with increased levels of diversity in the workforce. Similarity-Attraction Phenomenon One of the commonly observed phenomena in human interactions is the tendency for individuals to be attracted to similar individuals. This attraction influences interpersonal relationships as well as relations among groups.[24] Research shows that individuals show a preference toward similar others. They allocate greater resources to them when given the chance, show more positive attitudes toward them, and are more strongly drawn to them. They express greater levels of comfort with similar others, and display greater levels of confidence in homogeneous groups regardless of how they actually perform.[25] The similarity-attraction phenomenon may explain some of the potentially FIGURE 2.1 Levels of Diversity unfair treatment based on demographic traits. If a hiring manager chooses someIndividuals often initially judge others based on one who is similar over a more qualified candidate who is dissimilar in a surface-level diversity. Over time, this effect characteristic such as sex, race, or age, the decision will be unfair and a barrier to tends to fade and is replaced by deep-level traits such as similarity in values and attitudes. achieving diversity in the workplace. In other words, similarity-attraction may give the majority group an advantage in hiring or other human resource decisions because hiring managers will perceive greater chemistry and feel more comfortable with someone similar to them, jeopardizing the candidacy of someone who is different from the group composition. Even when candidates from underrepresented groups are hired, they may receive different treatment within the organization. For example, research shows that one way in which employees may get ahead within organizations is through being mentored by a knowledgeable and powerful mentor. Yet when the company does not have a formal mentoring program in which people are assigned a specific mentor, people are more likely to develop a mentoring relationship with someone who is similar to similarity-attraction them in demographic traits.[26] This means that those who are not selected as protégés will not be phenomenon able to benefit from the support and advice that would further their careers. Similarity-attraction The tendency to be more may even affect the treatment people receive daily. If a male manager frequently invites a male attracted to individuals employee to have lunch with him while a female employee is excluded from such interaction who are similar to us. opportunities, the male employee over time may develop greater access to information, advice, or other intangible opportunities that are beneficial to one’s career. Why are we more attracted to those who share our demographic attributes? Demographic traits are part of what makes up surface-level diversity. Surface-level diversity includes traits that are highly visible to us and those around us, such as race, gender, and age. Researchers believe that people pay attention to surface diversity because they are assumed to be related to deep-level diversity, which includes values, beliefs, and attitudes. We want to interact with those who share our values and attitudes, but when we meet people for the first time, we have no way of knowing whether they share similar values. As a result, we tend to use surface-level diversity to make judgments about deep-level diversity. Research shows that surface-level traits affect our interactions with other people early in our acquaintance with them, but as we get to know people, the influence of surface-level traits is replaced by deep-level traits such as similarity in values and attitudes.[27] Age, race, and gender dissimilarity are also stronger predictors of employee turnover during the first few weeks or months within a company. It seems that people who are different from others © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. surface-level diversity Traits that are highly visible to us and those around us, such as race, gender, and age. deep-level diversity Diversity in values, beliefs, and attitudes. 46 Organizational Behavior may feel isolated during their early tenure when they are dissimilar to the rest of the team, but these effects tend to disappear as people stay longer and get to know other employees. As you may see, while similarity-attraction may put some employees at a disadvantage, it is a tendency that can be managed by organizations. By paying attention to employees early in their tenure, having formal mentoring programs in which people are assigned mentors, and training managers to be aware of the similarity-attraction tendency, organizations can go a long way in dealing with potential diversity challenges. Faultlines faultline An attribute along which a group is split into subgroups. A faultline is an attribute along which a group is split into subgroups. For example, in a group with three women and three men, gender may act as a faultline because the women may see themselves as separate from the men. Now imagine that the women of the same team are all over age 50 and the men are all under age 25. In this case, age and gender combine to further divide the group into two subgroups. Teams that are divided by faultlines experience a number of difficulties. For example, members of the different subgroups may avoid communicating with each other, reducing the overall cohesiveness of the team. Research shows that teams with faultlines experience more conflict, are less cohesive, and have less satisfaction and performance.[28] Faultlines are more likely to emerge in diverse teams, but not all diverse teams have faultlines. Going back to our example, if the team has three men and three women as members, but if two of the women are older and one of the men is also older, then the composition of the team will have a much different effect on the team’s processes. In this case, age could be a bridging characteristic that brings together people divided across gender. Research shows that even groups that have strong faultlines can perform well if they establish certain norms. When members of subgroups debate the decision topic among themselves before having a general group discussion, there seems to be less communication during the meeting on pros and cons of different alternatives. Having a norm stating that members should not discuss the issue under consideration before the actual meeting may be useful in increasing decision effectiveness.[29] Further, the existence of an inclusive diversity climate reduced the negative effects of faultlines on loyal behaviors.[30] FIGURE 2.2 Group Faultlines The group on the left will likely suffer a strong faultline due to the lack of common ground. The group to the right will likely only suffer a weak faultline because the men and women of the different groups will likely identify with each other. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work 47 Stereotypes and Unconscious Biases An important challenge of managing a diverse workforce is the possibility that stereotypes and unconscious biases about different groups could lead to unfair decision making. Stereotypes are generalizations about a particular group of people. The assumption that women are more relationship oriented, while men are more assertive, is an example of a stereotype. Unconscious (or implicit) biases are stereotypes that are held that are outside of conscious awareness. For example, a manager who is surprised that the technical employee all the clients are raving about is a woman may be demonstrating an unconscious bias. The problem with stereotypes and unconscious biases is that individuals may rely on stereotypes when making decisions, instead of collecting actual data and verifying their assumptions. As a result, stereotypes may lead to unfair and inaccurate decision making. For example, a hiring manager holding the stereotype that men are more assertive may prefer a male candidate for a management position over a well-qualified female candidate. The assumption would be that management positions require assertiveness and the male candidate would be more assertive than the female candidate. Being aware of these stereotypes is the first step to preventing them from affecting decision making. Research has shown that stereotypes and implicit biases affect hiring decisions. For example, in a laboratory experiment, when individuals were asked to hire someone for a job involving math abilities, they were twice as likely to hire a man. Even providing past performance information did not fully eliminate this male advantage. Such discrimination may be part of the puzzle for the underrepresentation of women in science and engineering.[31] Further, stereotypes and prejudices are associated with more covert and interpersonal forms of discrimination, such as acting less warm and friendly toward the stigmatized person, being more rude toward this person, or cutting the interaction short.[32] ScienceForWork is a nonprofit organization dedicated to providing decision makers with trustworthy and useful insights from the science of organizations and people management. They review meta-analyses and summarize findings such as the one here. You will see figures from their work throughout this book. Reprinted with permission. Originally published on ScienceForWork. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. stereotypes Generalizations about a particular group of people. unconscious (or implicit) biases Stereotypes about specific groups that are held outside of conscious awareness. 48 Organizational Behavior Organizations may take concrete steps to prevent stereotypes from affecting their decisions. For example, orchestras in the United States saw a dramatic increase in female musicians after they started introducing “blind” auditions—auditions in which the candidate plays behind a screen.[33] In 2006, France passed a law requiring employers with more than 50 employees to remove personal data that potentially signals an applicant’s race, religion, or ethnicity from résumés in order to prevent stereotypes from influencing who is hired.[34] Such structural changes may help to systematically prevent stereotypes from affecting employment decisions. Specific Diversity Issues Different demographic groups face unique work environments and varying challenges in the workplace. In this section, we will review the particular challenges associated with managing gender, race, religion, physical ability, and sexual orientation diversity in the workplace. Sex Diversity in the Workplace In the United States, three important pieces of legislation prohibit sex discrimination at work. The Equal Pay Act (EPA, 1963) prohibits discrimination in pay based on sex. Title VII of the Civil Rights Act (1964) prohibits discrimination in all employment-related decisions based on sex. In 2009, the Lilly Ledbetter Fair Pay Act was signed into law. This act is named after a woman who, at the end of her 19 years as a supervisor at a Goodyear tire factory, discovered she had been paid less than her male counterparts. The act gives a potential litigant 180 days to file a claim every time a worker receives a paycheck. Despite the existence of protective legislation, women and men often face different treatment at work. The earnings gap, the glass ceiling, and sexual harassment are three key problems women may experience in the workplace that we will discuss in more detail. Earnings Gap An often publicized issue women face at work is the earnings gap. Considering both full- and part-time workers, the median earnings of women in 2018 was 85% of men in the United States.[35] There are many potential explanations for the earnings gap that are often reported in the popular media. Some explanations for this gap focus on “human capital.” According to this view, women and men bring different investments to work. For example, women work shorter hours, are underrepresented in high-paying occupations such as engineering and overrepresented in low-paying occupations such as kindergarten teacher, and have more gaps in their résumés due to parenthood, which explains part of the sex differences in pay.[36] It is important to note that these do not provide a full explanation for the sex differences in pay, and framing these factors as “individual choice” may be misguided. As a case in point, many organizations do not have family-supportive policies in place, resulting in women having to leave their jobs following motherhood. While these decisions may be interpreted as choice, they also indicate lack of alternatives. A commonly used explanation for the pay gap is that women are less likely to negotiate. There is some truth to this, as research has shown that when it is unclear whether wages are negotiable, male job seekers are more likely to negotiate. Interestingly, when it is explicitly mentioned that wages are negotiable, such differences disappear.[37] At the same time, laboratory studies show that women candidates who negotiated were more likely to be penalized for their attempts to negotiate, and male evaluators expressed an unwillingness to work with a woman who negotiated.[38] In other words, there may be some danger in simply advising women to negotiate: They may be choosing not to negotiate, predicting that negotiation would not result in positive outcomes for them, and may in fact damage relationships. The differences in the tendency to negotiate and success in negotiating are important factors contributing to the earnings gap. According to one estimate, as © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work 49 much as 34% of the differences between women’s and men’s pay can be explained by their starting salaries.[39] When differences in negotiation tendencies or outcomes affect starting salaries, they may have a large impact over the course of years. In short, the earnings gap is a complicated issue that may not be reduced to differences in negotiation tendencies or outcomes. Effective negotiation and learning to advocate for oneself is important for everyone in general, but organizations may play a role here by making it clear when it is expected that candidates will negotiate, and ensuring that employees are paid based on what they are worth as opposed to their skills in negotiating. Numerous studies suggest that stereotypes and biases disadvantaging women are alive and well. One meta-analysis showed that the male-female gap in pay was larger in occupations that were male dominated, and in complex jobs. These differences were not explainable by differences in performance of men and women.[40] In an experimental study where MBA students played the role of investors, the recommended percentage to invest in the Initial Public Offering (IPO) of an entrepreneurial business was four times as much when the company was led by a male CEO.[41] Companies and governments are beginning to take action to close the gap. Organizations such as Adobe, Expedia, and Starbucks made public pledges to closing the pay gap through periodic audits followed by concrete action. Cities and states including Oregon, California, and New York City now ban asking job applicants about their pay history, as this practice perpetuates past gaps. Further, states including Massachusetts, New Jersey, and Oregon passed laws that would encourage employers to minimize pay differentials among employees performing comparable work when such differences are not explainable through job related factors.[42] Glass Ceiling Another issue that provides a challenge for women in the workforce is the so-called glass ceiling. While women may be represented in lower level positions, they are less likely to be seen in higher management and executive suites of companies.[43] In fact, while women constitute close to onehalf of the workforce, men are four times more likely to reach the highest levels of organizations.[44] Although a record number of female CEOs of Fortune 500 firms emerged in 2020, they still only accounted for 7.4% of the CEOs on the list.[45] In fact, a study by the global consulting firm DDI on 55,000 assessments for top leadership roles, including CEO roles, showed that 52% of the organizations did not have a single female candidate in their selection pool (and when they had one female candidate, she was never chosen).[46] A related phenomenon is termed glass cliff. This is the tendency of women and minority members to be promoted to leadership positions in poor-performing, struggling firms. Even though these leaders look like they broke through the glass ceiling, they are at a higher risk of failure. Struggling firms may be more likely to offer these precarious positions to women and minorities to signal that they intend to make a change, and the candidates may be more likely to accept these positions thinking that this is their only chance at leadership. Research also shows that when the firm performance further declines under their leadership, the firm is more likely to replace them with a white and male leader.[47] The absence of women in leadership is problematic, particularly in light of studies that show the leadership performance of female leaders is comparable to, and in some dimensions such as transformational or change-oriented leadership, superior to, the performance of male leaders.[48] One explanation for the glass ceiling is the sex-based stereotypes favoring men in managerial positions. Traditionally, men have been viewed as more assertive and confident than women, while women have been viewed as more passive and submissive. Studies show that these particular stereotypes are still prevalent among male college students, which may mean that these stereotypes may be perpetuated among the next generation of managers.[49] Assumptions such as these are problematic for women’s advancement because stereotypes associated with men are characteristics often associated with being a manager. Stereotypes are also found to influence how managers view male versus female employees’ work accomplishments. For example, when men and women work together in a team on a stereotypically “masculine” task such as working on an investment portfolio and it is not clear to management which member has done what, managers are more © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. As of May 2020, only 37 of the Fortune 500 were helmed by a female CEO. Pictured here is Safra Katz, CEO of Oracle. drserg/Shutterstock.com glass ceiling The situation that some qualified employees are prevented from advancing to higher level positions due to factors such as discrimination. The glass ceiling is often encountered by women and minorities. glass cliff Tendency of women and minority members to be promoted to leadership positions in poor performing, struggling firms. 50 Organizational Behavior likely to attribute the team’s success to the male employees and give less credit to the female employees.[50] There are many organizations making the effort to make work environments more welcoming to men and women. For example, IBM is reaching out to female middle school students to get them interested in science, hoping to increase female presence in the field of engineering.[51] Companies such as IBM, Deloitte, Ernst & Young, Unilever, and Johnson & Johnson topped the 2019 100 Best Companies list created by Working Mother magazine by providing flexible work arrangements to balance work and family demands. In addition, these companies provide employees of both sexes with learning, development, and networking opportunities.[52] Sexual Harassment Norway is a pioneer in tackling the glass ceiling problem through legislation. In 2002, they passed a law requiring boards of directors to be made up of at least 40% women in all state-owned and publicly listed companies starting in 2008. Other European countries, such as France and Spain, followed suit. Shutterstock.com sexual harassment Unwanted sexual advances, requests for sexual favors, and other verbal and physical conduct that is sexual in nature. Sexual harassment refers to unwanted sexual advances, requests for sexual favors, and other verbal and physical conduct that is sexual in nature. The perpetrator may be a supervisor, a colleague, or a client. The victim may be a man or a woman, and the perpetrator and victim may be of the same sex. Regardless of the specifics, sexual harassment is conduct that is illegal according to the Equal Employment Opportunity Commission.[53] In 2019, men filed 16.8% of the sexual harassment claims with EEOC, suggesting that even though sexual harassment affects both sexes, women are disproportionately affected.[54] Sexual harassment has long-lasting and negative effects on employees. For example, research has shown that it has been related to depression even a decade later, to poor job attitudes such as organizational commitment and job satisfaction, higher levels of absenteeism, and a tendency to quit an occupation altogether. Sexual harassment has implications for problems such as the earnings gap that we discussed earlier. For women, sexual harassment is more likely to occur when they work in male-dominated industries, but these occupations are also ones where pay rates are higher, which means that leaving these occupations may result in pay penalties over the course of one’s career.[55] In 2017, the #MeToo movement brought the prevalence of sexual harassment to international awareness, resulting in the downfall of high-profile, longtime accused perpetrators of such harassment. Organizations need to take meaningful steps to prevent harassment, including providing training, establishing mechanisms where victims can report what happened without having to go through their manager, taking quick action to protect the victim while ensuring due process, and creating organizational cultures that do not tolerate the abuse and harassment of anyone. Further, one study utilizing two large military samples showed that sexual harassment was less prevalent in units where there was a justice climate, an emphasis on unbiased decision making, consistency, and where employees were involved in decisions affecting them.[56] In other words, fostering a climate of fairness may create an environment where everyone is treated with dignity and respect. Race Diversity in the Workplace Race is another demographic characteristic that is under legal protection in the United States. Title VII of the Civil Rights Act (1964) prohibits race discrimination in all employment-related decisions. Yet systemic race discrimination continues to exist in many organizations. In a Korn-Ferry/Columbia University study of 280 minority managers earning more than $100,000, 60% of the respondents reported that they had seen discrimination in their work assignments and 45% had been the target of racial or cultural jokes. The fact that such discrimination exists even at higher levels in organizations is noteworthy.[57] In a different study of over 5,500 workers, only 32% reported that their company did a good job hiring and promoting minorities.[58] One estimate suggests that when compared to white employees, Black employees are four times more likely and Hispanics are three times more likely to experience discrimination.[59] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work Ethnic minorities experience both an earnings gap and a glass ceiling. In the first quarter of 2020, for every $1 a Caucasian male employee made, Black males made around 75 cents while Hispanic males made just under 70 cents. The situation is somewhat different for Asian males, who make approximately $1.24 for every every $1 earned by their Caucasian counterparts.[60] However, Asian males are still underrepresented in top management and as such, experience the glass ceiling phenomenon.[61] In early 2020, only five Fortune 500 companies had Black CEOs.[62] It is interesting that while ethnic minorities face these challenges, the demographic trends are such that by 2045, Caucasians are estimated to constitute less than one-half of the population in the United States.[63] Unfortunately, discrimination against ethnic minorities still occurs. One study conducted by Harvard University researchers found that when Chicago-area companies were sent fictitious résumés containing identical background information, résumés with “Caucasian-sounding” names (such as Emily and Greg) were more likely to get callbacks compared to résumés with “Black-sounding” names (such as Jamal and Lakisha).[64] Race and sex also interact with each other to affect others’ reactions to the individual and often constitute a “double jeopardy.” For example, women of color are asked to do more “office housework” such as being expected to order lunch for everyone. Even in instances where such tasks do not take much time, they take time away from tasks that involve more learning and growth opportunities and reinforce existing power dynamics keeping them in lower level positions. Refusing to take on these assignments may also hurt the employee by labeling them as noncooperative.[65] Studies indicate that ethnic minorities are less likely to experience a satisfying work environment. One study found that Black employees were more likely to be absent from work compared to Caucasians, but this trend existed only in organizations viewed as not valuing diversity.[66] Similarly, among Black employees, the perception that the organization did not value diversity was related to higher levels of turnover.[67] Another study found that perceived race discrimination resulted in lower commitment to the organization, but this relationship was weaker when employees felt that the organization was taking steps to be supportive of diversity.[68] Unconscious biases and racial profiling are harmful to employees, businesses, and societies. In 2018, Starbucks was in national news as a result of such biases. A store manager in Philadelphia asked two Black men to leave the store as they had not ordered anything (they were waiting for a friend). When they refused to leave, the manager called the police, which resulted in the arrest of the individuals. Following the public outcry, Starbucks apologized and closed more than 8,000 stores to provide its employees with unconscious bias training. One training by itself is unlikely to prevent such incidents from happening, but this incident powerfully displays the harm and unfairness that can be caused by biases. The year 2020 saw widespread protests of racial injustice following the killing of George Floyd under police custody, spurring businesses to make public commitments to examine hiring, management, and reward policies, and to make improvements.[69] For example, Microsoft committed $150 million to diversity initiatives, and set a goal to double the number of Black employees by 2025.[70] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 51 52 Organizational Behavior Age Diversity in the Workplace Older employees tend to be reliable and committed employees who often perform at comparable or higher levels than younger workers. Shutterstock.com The workforce is rapidly aging. By 2024, those who are age 55 and older are estimated to constitute 25% of the workforce in the United States. The same trend seems to be occurring elsewhere in the world. Further, by the same date, the fastest growing labor participation rate is expected to be those 65 and older.[71] These changes signal that the age diversity of the workforce is expected to increase. What happens to work performance as employees get older? Research shows that age is correlated with a number of positive workplace behaviors, including higher levels of citizenship behaviors such as volunteering, higher compliance with safety rules, lower work injuries, lower counterproductive behaviors, and lower rates of tardiness or absenteeism.[72] Despite their positive workplace behaviors, employees who are older often have to deal with age-related stereotypes at work. For example, a review of a large number of studies showed that those between 17 and 29 years of age tend to rate older employees more negatively, while younger employees were viewed as more qualified and having higher potential.[73] However, these stereotypes have been largely refuted by research.[74] Another review showed that stereotypes about older employees—they perform on a lower level, they are less able to handle stress, or their performance declines with age—are simply inaccurate.[75] The problem with these stereotypes is that they may discourage older workers from remaining in the workforce or may act as a barrier to their being hired in the first place. The results of the accumulated body of research suggests that there are either no differences in performance based on age, or in some cases the relationship is positive, which means that age-related stereotypes have little to no support.[76] In the United States, age discrimination is prohibited by the Age Discrimination in Employment Act of 1967, which makes it illegal for organizations to discriminate against employees over 40 years of age. Still, age discrimination is prevalent. For example, in 2018, two United Airlines employees were awarded $800,000 in a wrongful termination lawsuit involving age discrimination. The employees were fired for not wearing an apron and watching their iPad for 15 minutes, but the jury believed that these reasons were pretext and age of the employees motivated the termination.[77] Family businesses account for 50% of the gross domestic product; 60% of U.S. employment and 35% of Fortune 500 firms are family controlled. Around the world, in many family-owned businesses, different generations work together. Age diversity within a team can actually lead to higher team performance. In a simulation, teams with higher age diversity were able to think of different possibilities and diverse actions, leading to higher performance for the teams.[78] At the same time, managing a team with age diversity may be challenging because different age groups seem to have different opinions about what is fair treatment, leading to different perceptions of organizational justice.[79] Organizations that are age inclusive and manage to develop cultures that respect and support age diversity and the needs of employees of different age groups reap benefits in the form of greater levels of job satisfaction, organizational commitment, and motivation to continue working past the retirement age.[80] One of the ways in which organizations may create an age-inclusive workplace is to utilize flexible work arrangements tailored to individual needs. Research has shown that the use of individualized work arrangements was most useful in reducing employee exhaustion in groups where age diversity was high. Further, organizations may create a more positive environment for older workers by providing on-the-job resources such as opportunities to utilize a variety of skills, a procedurally fair organizational climate, and supportive relationships with managers, as older workers have been shown to be more sensitive to the absence of these resources.[81] Religious Diversity in the Workplace Shutterstock.com In the United States, employers are prohibited from using religion in employment decisions based on Title VII of the Civil Rights Act of 1964. Moreover, employees are required to make reasonable accommodations to ensure that employees can practice their beliefs unless doing so provides an unreasonable hardship on the employer.[82] Religious discrimination often occurs because the religion necessitates modifying the employee’s schedule. For example, devout Muslim employees may want to pray five times a day with each prayer lasting 5 to 10 minutes. Some Jewish employees may © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work want to take off Yom Kippur and Rosh Hashanah, although these days are not always recognized as holidays in the United States. These situations pit employers’ concerns for productivity against employees’ desires to fulfill religious obligations. Accommodating someone’s religious preferences may also require companies to relax their dress code to take into account religious practices such as wearing a turban for Sikhs or covering one’s hair with a scarf for Muslim women. In these cases, what matters most is that the company makes a good faith attempt to accommodate the employee. Further, organizations should avoid requiring employees to participate in religious practices such as prayer meetings or religious discussions. Forcing employees to participate in a religious activity is illegal. In 2018, United Health Programs, an insurance and employee benefits services company, was sued for requiring employees to follow a “Harnessing Happiness” system involving prayers, religious workshops, and ritual spiritual cleansing. Harnessing Happiness is considered a religion, and therefore in the resulting lawsuit, the company was ordered to stop these practices and pay $5.1 million to former and current employees who brought the lawsuit.[83] Employees with Disabilities in the Workplace Employees with a wide range of physical and mental disabilities are part of the workforce. The Americans with Disabilities Act of 1990 (ADA) prohibits discrimination in employment against individuals with physical as well as mental disabilities if these individuals are otherwise qualified to do their jobs with or without reasonable accommodation. For example, for a job that requires frequently talking over the phone, an organization may receive a job application from a candidate with partial hearing loss. With the help of a telephone amplifier, which costs less than $50, the employee will be able to perform the job; therefore, the company cannot use the hearing loss as a reason not to hire the person, again, as long as the employee is otherwise qualified. Even when a disability has no bearing on job performance, it may constitute a barrier that harms the employee. For example, applicants with disabilities experience more barriers in hiring. In one experiment, researchers sent identical résumés to accounting jobs. Of the cover letters, 1/3 mentioned that the applicant had a spinal cord injury, 1/3 noted that the applicant had Asperger's syndrome, and 1/3 mentioned neither. The résumés that mentioned the spinal cord injury and Asperger's syndrome on average received 26% fewer expressions of employer interest.[84] After being hired, employees with disabilities are more likely to be stereotyped, locked into dead-end jobs, and employed in jobs that require substantially lower skills and qualifications than they possess. They also are more likely to quit their jobs.[85] What can organizations do to create a more inclusive work environment for employees with disabilities? A climate of inclusiveness was shown to be useful in neutralizing the negative effects of being different from one’s manager with regards to disability status.[86] Therefore, fostering a climate of inclusion is important. Legally, when an employee brings up a disability, the organization should consider reasonable accommodations. This may include modifying the employee’s schedule and reassigning some nonessential job functions. Organizations that offer flexible work hours may also make it easier for employees with disabilities to be more effective. Finally, supportive relationships with others seem to be the key for making these employees feel at home. Having an understanding boss and an effective relationship with supervisors is particularly important for employees with disabilities. Because the visible differences between individuals may unconsciously act as an initial barrier against developing rapport, creating systems that facilitate relation development opportunities may be beneficial.[87] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 53 54 Organizational Behavior Sexual Orientation and Gender Identity Diversity in the Workplace Lesbian, bisexual, gay, transgender, and queer/questioning (LBGTQ) employees in the workplace have faced a number of challenges and barriers to employment throughout the years. Until recently, there was no federal law in the United States prohibiting discrimination based on sexual orientation. Nonetheless, in 2019, 21 states as well as the District of Columbia had laws prohibiting discrimination in employment based on sexual orientation and gender identity. In addition, 91% of the Fortune 500 companies have implemented non-discrimination policies that include sexual orientation and gender identity.[88] These policies seem to have benefits to organizations, as research has shown that firms that have LGBTQ-supportive policies had higher firm value, productivity, and profitability, and benefited more from Research and Development (R&D) activities.[89] On June 15, 2020, the United States Supreme Court made a monumental ruling, ensuring that the Civil Rights Act of 1964 would be extended to protect gay, lesbian, and transgender employees from sex-based discrimination at work, making discrimination in employment decisions based on sexual orientation and gender identity illegal.[90] Research shows that one of the most important issues relating to sexual orientation is the disclosure of sexual identity in the workplace. According to one estimate, up to one-third of lesbian, gay, and bisexual employees do not disclose their sexual orientation at work. Employees may fear the reactions of their managers and coworkers, leading to keeping their sexual identity a secret. In reality, though, it seems that disclosing sexual orientation is not the key to explaining work attitudes of these employees—it is whether or not they are afraid to disclose their sexual identity. In other words, those employees who fear that full disclosure would lead to negative reactions experience lower job satisfaction, reduced organizational commitment, and higher intentions to leave their jobs.[91] Creating an environment where all employees feel welcome and respected regardless of their sexual orientation is the key to maintaining a positive work environment. Two organizational resources that seem to make the most difference for LGBTQ employee attitudes, stress, perceived discrimination, and disclosures are LGBTQ-supportive organizational climates and supportive interpersonal relationships.[92] Companies such as Coca-Cola, Accenture, IBM, and Procter & Gamble create inclusive cultures by providing transgender-inclusive healthcare coverage, removing barriers to fairness, and by providing a public commitment.[93] OB Toolbox: I Think I Am Being Asked Potentially Illegal Interview Questions. What Can I Do? Shutterstock.com In the United States, demographic characteristics discussed in this chapter are protected by law. Yet according to a survey of 4,000 job seekers, about one-third of job applicants have been asked potentially illegal interview questions. How can you answer such questions?[94] Here are your options. • Refuse to answer. You may point out that the question is illegal and refuse to answer. This may cost you the job offer, because you are likely to seem confrontational and aggressive. • Answer shortly. Instead of giving a full answer to a question such as “are you married,” you could answer the question briefly and steer the conversation to the job. In some cases, © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work 55 the interviewer may be trying to initiate small talk and may be unaware that the question is potentially illegal. • Answer the intent or potential concern behind the question. Sometimes, the illegal question hides a legitimate concern. When you are being asked where you are from, the potential employer might be concerned that you do not have a work permit. Addressing the issue in your answer may be better than answering the question you are being asked. • Evaluate the situation and what is in your best interest. Your next move should depend on a number of factors. For example, do you believe discrimination or just a mistake in what’s legal was behind the offending question? Based on the answers you come up with, decide if this is the kind of company that you could work for or not. • Walk away from the interview. If you feel that the intent of the question is discriminatory, and if you feel that you would rather not work at a company that would ask such questions, you can always walk away from the interview. If you feel that you are being discriminated against, you may also want to talk to a lawyer later on. Tools for Creating an Inclusive Workplace What can organizations do to manage diversity more effectively and create an inclusive workplace? In this section, we review research findings and the best practices from different companies to create a list of suggestions for organizations. Inclusive Workplace Culture In the most successful companies, diversity management is not the sole responsibility of the human resource department or a chief diversity officer. Starting from top management and including the lowest levels in the hierarchy, each person understands the importance of respecting others. If this respect is not part of an organization’s culture, no amount of diversity training or other programs are likely to be effective. In fact, in the most successful companies, diversity and inclusion are viewed as everyone’s responsibility. Companies with a strong culture—where people have a sense of shared values, loyalty to the organization is rewarded, and team performance is celebrated—enable employees with vastly different demographics and backgrounds to feel a sense of belonging.[95] The Black Lives Matter movement and protests of systemic racism resulted in increased expectations that businesses accept more accountability to tackle structural racism. The Broadway League, the coalition of U.S. theater owners, committed to performing a diversity audit of all aspects of their operations.[96] Diversity Training Programs Diversity training programs are popular. However, not all diversity programs are equal. Perhaps not surprisingly, more successful programs are those that occur in companies where a culture of diversity exists. A study of over 700 companies found that programs with a higher perceived success rate were those that occurred in companies where top management believed in the importance of diversity, where there were explicit rewards for increasing diversity of the company, and where managers were required to attend the diversity training programs.[97] Training features affect whether training results in a change in attitudes toward diversity. For example, active programs involving exercises are better than passive, lecture-type programs. Further, in-person training programs are better than computerized training.[98] In one field experiment, researchers have shown that a one-hour online training program resulted in behavioral changes only on the part of par- © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. According to DiversityInc, Marriott International, Inc. was the best company for diversity in 2020. DELBO ANDREA/Shutterstock. com 56 Organizational Behavior ticipants who were already supportive of diversity prior to training.[99] One downside of diversity training programs is that they may put employees on the defensive, treating them as perpetrators of discrimination and harassment. Instead, designing training programs with the assumption that participants of the training program are victim’s allies, and teaching them to identify problematic behaviors as well as how to intervene are promising approaches to diversity training.[100] Recruitment Practices Companies may want to increase diversity by targeting a pool that is more diverse. There are many minority professional groups such as the National Black MBA Association or the Chinese Software Professionals Association. By building relations with these occupational groups, organizations may attract a more diverse group of candidates to choose from. Hiring based on a vague description of culture fit is also potentially problematic, as it may result in a tendency to hire people who are similar to the existing composition of the workplace while excluding people who are different.[101] The auditing company Ernst & Young Global Ltd. increases diversity of job candidates by mentoring undergraduate students.[102] Companies may also want to review their job advertisements to ensure that they are inclusive. For example, there is some evidence that words such as “competitive” and “dominate” may attract more men, whereas words such as “supportive” may be more appealing to women. These biases are likely to operate at an unconscious level, but in the end may yield an unbalanced candidate pool.[103] Idiosyncratic Deals (i-deals) i-deals Negotiated arrangements between employees and managers that benefit the employee and the organization. As workplaces become more diverse, companies may find that having standardized work arrangements where every employee is treated the same may no longer be fair. For example, having a standard work schedule of 9am to 5pm could be a hardship for employees with families, or employees who are interested in working fewer hours. Employees may have unique training, job content, or flexibility needs where it may be possible to tailor the job to the person more effectively. As a result, idiosyncratic deals, or i-deals are becoming more common. I-deals are negotiated arrangements between employees and managers that benefit the employee and the organization. I-deals have implications for workplace behaviors and attitudes. For example, one study has shown that flexibility i-deals were related to being more effective at home, which in turn predicted being more effective at work.[104] These individualized and negotiated deals may be especially useful for managing a diverse workforce. As a case in point, one study has shown that prevalence of i-deals were related to less emotional exhaustion and higher levels of collective commitment to the organization, and predicted better client outcomes in units with higher levels of age diversity.[105] In other words, being open to customizing work arrangements to fit the needs of the workforce by partnering with individual employees may help organizations manage a diverse workforce more effectively. Affirmative Action Programs affirmative action Policies designed to recruit, promote, train, and retain employees belonging to a protected class. Policies designed to recruit, promote, train, and retain employees belonging to a protected class are referred to as affirmative action. Based on Executive Order 11246 (1965), federal contractors are required to use affirmative action programs. In addition, the federal government, many state and local governments, and the U.S. military are required to have affirmative action plans. An organization may also be using affirmative action as a result of a court order or due to a past history of discrimination. Affirmative action programs are among the most controversial methods in diversity management because some people believe that they lead to an unfair advantage for minority members. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work In many cases, the negative perceptions about affirmative action can be explained by misunderstandings relating to what such antidiscrimination policies entail. Moreover, affirmative action means different things to different people, and therefore it is inaccurate to discuss affirmative action as a uniform package. Four groups of programs can be viewed as part of affirmative action programs:[106] 1. Simple elimination of discrimination. These programs are the least controversial and are received favorably by employees. 2. Targeted recruitment. These affirmative action plans involve ensuring that the candidate pool is diverse. These programs are also viewed as fair by most employees. 3. Tie-breaker. In these programs, if all other characteristics are equal, then preference may be given to a minority candidate. In fact, these programs are not widely used and their use needs to be justified by organizations. In other words, organizations need to have very specific reasons for why they are using this type of affirmative action, such as past illegal discrimination. Otherwise, their use may be illegal and lead to reverse discrimination. These programs are viewed as less fair by employees. 4. Preferential treatment. These programs involve hiring a less-qualified minority candidate. Strong preferential treatment programs are illegal in most cases. These programs are viewed as unfair by employees. It is plausible that people who are against affirmative action programs may have unverified assumptions about the type of affirmative action program the company is using. Informing employees about the specifics of how affirmative action is being used may be a good way of dealing with any negative attitudes. In fact, a review of the past literature revealed that when specifics of affirmative action are not clearly defined, observers seem to draw their own conclusions about the particulars of the programs.[107] In addition to employee reactions to affirmative action, there is some research indicating that affirmative action programs may lead to stigmatization of the perceived beneficiaries. For example, in companies using affirmative action, coworkers of new hires may make the assumption that the new hire was chosen due to sex or race as opposed to having the necessary qualifications. These effects may even occur in the new hires themselves, who may have doubts about the fact that they were chosen because they were the best candidate for the position. Research also shows that giving coworkers information about the qualifications and performance of the new hire eliminates these potentially negative effects of affirmative action programs.[108] OB Toolbox: How to Be an Effective Ally Shutterstock.com Allies are individuals who are not part of an underrepresented group, but behave in ways that support that group. Achieving an inclusive culture in the workplace demands all employees to be effective allies for each other, use their voice when they see injustice, and support their colleagues. How can you be an effective ally? • Educate yourself. Part of being an ally is to learn to identify systematic reasons why discrimination happens. Understand how unconscious biases, similarity-attraction, and recruitment and hiring practices may have unintended consequences. Being familiar with barriers to inclusion will help you identify them when you see them. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 57 58 Organizational Behavior • Be a good listener. Your colleagues may choose not to confide in you about the day-today hurdles of how being a minority harms them in your workplace. But if they do, listen. Do not interrupt, do not act defensive or try to play the devil’s advocate, and do not try to qualify their experiences by statements such as “Not all male managers do that.” Their experiences may be different from what you experience, which is normal and expected. This is an opportunity to support your colleagues, and learn how different employees may be faced with a different environment at work. • Speak up. If you witness injustice, speak up. Silently protesting someone does not have a lot of power or usefulness. For example, if you are a man and see that all invited speakers to an event are men, ask questions about the lack of diverse voices. Encourage those around you to do better. If you see a colleague being interrupted, lend your voice to them; politely call out the interrupter to let the speaker finish. If you witness your colleagues making ethnic jokes, tell them that their jokes are harmful and unacceptable. • Take concrete actions toward ending racism. Systematic racism developed over a long period of time. It will not end unless action is taken toward changing these established practices. However, there are many solutions that might be taken and determining which specific actions you can take toward helping end racism collectively becomes a powerful force for change. • You do not need special qualifications. You may think that you know little about racial injustice, or ageism, or ableism. You may worry about saying the wrong thing, or offending others. You may think that you do not understand all the issues. Remember that being an effective ally does not require special abilities beyond awareness of a particular issue and lending your voice to support your colleagues. Key Takeaway Inclusive organizations benefit from diversity because they achieve higher creativity, better customer service, higher job satisfaction, higher stock prices, and lower litigation expenses. At the same time, managing a diverse workforce is challenging for several key reasons. Employees are more likely to associate with those who are similar to them early in a relationship, the distribution of demographic traits could create faultlines within a group, and stereotypes may act as barriers to advancement and fair treatment of employees. Organizations can manage demographic diversity more effectively by building a culture of respect, conducting diversity audits and goal setting, creating diversity training programs, reviewing recruitment practices, offering non-standard work arrangements such as i-deals, and under some conditions, utilizing affirmative action programs. What do you think? 1. What does it mean for a company to manage diversity effectively? How would you know if a company is doing a good job of managing diversity? 2. How can an organization create an inclusive workplace? 3. How can organizations deal with the “similarity-attraction” phenomenon? Left unchecked, what are the problems this tendency can cause? 4. What is the earnings gap? Who does it affect? What are the reasons behind the earnings gap? 5. Do you think that laws and regulations are successful in eliminating discrimination in the workplace? Why or why not? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work 59 2.3 Cultural Diversity Learning Objectives 1. Explain what culture is. 2. Define the four dimensions of culture that are part of Hofstede’s framework. 3. Describe some ways in which national culture affects organizational behavior. Culture refers to values, beliefs, and customs that exist in a society. In the United States, the workforce is increasingly multicultural and the world of work is becoming increasingly international. The world is going through a transformation in which China, India, and Brazil are establishing themselves as major players in world economics. Companies are realizing that doing international business provides access to raw materials, resources, and a wider customer base. For many companies, international business is where most of the profits lie; for example, at Intel Corporation, the majority of revenues come from outside the United States. For many businesses, international business is the main source of their earnings. As a case in point, Avengers: Endgame (2019) is the top grossing movie of all time. Of its $2.797 billion gross earnings, $1.939 billion was from outside the United States, where the movie was made.[109] As a result of these trends, understanding the role of national culture for organizational behavior may provide you with a competitive advantage in your career. In fact, sometime in your career, you may find yourself working as an expatriate. An expatriate is someone who is temporarily assigned to a position in a foreign country. Such an experience may be invaluable for your career and challenge you to increase your understanding and appreciation of differences across cultures. How do cultures differ from each other? If you have ever visited a country different from your own, you probably have stories to tell about what aspects of the culture were different and which were similar. Maybe you have noticed that in many parts of the United States people routinely greet strangers with a smile when they step into an elevator or see them on the street, but the same behavior of saying hello and smiling at strangers would be considered odd in many parts of Europe. In India and other parts of Asia, traffic flows with rules of its own, with people disobeying red lights, stopping and loading passengers in highways, or honking continuously for no apparent reason. In fact, when it comes to culture, we are like fish in the sea: We may not realize how culture is shaping our behavior until we leave our own and go someplace else. Cultural differences may shape how people dress, how they act, how they form relationships, how they address each other, what they eat, and many other aspects of daily life. Of course, talking about national cultures does not mean that national cultures are uniform. In many countries, it is possible to talk about the existence of cultures based on region or geography. For example, in the United States, the southern, eastern, western, and midwestern regions of the country are associated with slightly different values. Thinking about hundreds of different ways in which cultures may differ is not very practical when you are trying to understand how culture affects work behaviors. For this reason, the work of Geert Hofstede, a Dutch social scientist, is an important contribution to the literature. Hofstede studied IBM employees in 66 countries and showed that four dimensions of national culture explain an important source of variation among cultures. Research also shows that cultural variation with respect to these four dimensions influences employee job behaviors, attitudes, well-being, motivation, leadership, negotiations, and many other aspects of organizational behavior.[110] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. culture The values, beliefs, and customs that exist in a society. expatriate Someone who is temporarily assigned to a position in a foreign country. 60 Organizational Behavior TABLE 2.1 Hofstede’s Culture Framework Individualism Collectivism Cultures in which people define themselves as individuals and form looser ties with their groups Cultures where people have stronger bonds to their groups and group membership forms a person’s self- identity USA Guatemala Australia Ecuador UK Indonesia Canada Pakistan Hungary China Low Power Distance High Power Distance A society that views an unequal distribution of power as relatively unacceptable A society that views an unequal distribution of power as relatively acceptable Austria Malaysia Denmark Slovakia Israel Philippines Ireland Russia New Zealand Mexico Low Uncertainty Avoidance High Uncertainty Avoidance Cultures in which people are comfortable in unpredictable situations and have high tolerance for ambiguity Cultures in which people prefer predictable situations and have low tolerance for ambiguity Denmark Belgium Jamaica El Salvador Singapore Greece China Guatemala Sweden Portugal Masculinity Femininity Cultures in which people value achievement and competitiveness, as well as acquisition of money and other material objects Cultures in which people value maintaining good relationships, caring for the weak, and quality of life Slovakia Norway Japan Netherlands Hungary Sweden Austria Costa Rica Venezuela Chile Hofstede’s culture framework is a useful tool to understand the systematic differences across cultures on four key dimensions. Source: Adapted from information in Geert Hofstede cultural dimensions, accessed June 1, 2018, http://www.geert-hofstede.com/ hofstede_dimensions.php. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work 61 Individualism-Collectivism Individualistic cultures are cultures in which people define themselves as an individual and form looser ties with their groups. These cultures value autonomy and independence of the person, selfreliance, and creativity. Countries such as the United States, United Kingdom, and Australia are examples of individualistic cultures. In contrast, collectivistic cultures are cultures where people have stronger bonds to their groups and group membership forms a person’s self-identity. Asian countries such as China and Japan, as well as countries in Latin America are higher in collectivism. individualistic cultures Cultures in which people define themselves as individuals and form looser ties with their groups. In collectivistic cultures, people define themselves as part of a group. In fact, this may be one way to detect people’s individualism-collectivism level. When individualists are asked a question such as “Who are you? Tell me about yourself,” they are more likely to talk about their likes and dislikes, personal goals, or accomplishments. When collectivists are asked the same question, they are more likely to define themselves in relation to others, such as “I am Chinese” or “I am the daughter of a doctor and a homemaker. I have two brothers.” In other words, in collectivistic cultures, self-identity is shaped to a stronger extent by group memberships.[111] collectivistic cultures In collectivistic societies, family bonds are highly influential in people’s daily lives. While individualists often refer to their nuclear family when thinking about their families, collectivists are more likely to define family in a broader sense, including cousins, uncles, aunts, and second cousins. Family members are more involved in each others’ lives. In many collectivistic societies, the language reflects the level of interaction among extended family members such that there may be different words used to refer to maternal versus paternal grandparents, aunts, or uncles. In addition to interacting with each other more often, family members have a strong sense of obligation toward each other. Children often expect to live with their parents until they get married. In collectivistic countries such as Thailand, Japan, and India, choosing a school, career, or finding a spouse are all family affairs. In these cultures, family members feel accountable for each others’ behavior such that one person’s misbehavior may be a cause of shame for the rest of the family.[112] Understanding the importance of family in collectivistic cultures is critical to understanding their work behaviors. For example, one multinational oil company in Mexico was suffering from low productivity. When the situation was investigated, it became clear that the new manager of the subsidiary had gotten rid of a monthly fiesta for company employees and their families under the assumption that it was a waste of time and money. Employees had interpreted this to mean that the company no longer cared about their families.[113] In India, companies such as Intel organize “take your parents to work day” and involve parents in recruitment efforts, understanding the role of parents in the career and job choices of prospective employees.[114] Due to increased globalization of businesses, understanding the role of culture for organizational behavior may provide you with a competitive advantage in your career. Collectivists are more attached to their groups and have more permanent attachments to these groups. Conversely, individualists attempt to change groups more often and have weaker bonds to them. It is important to recognize that to collectivists the entire human universe is not considered to be their in-group. In other words, collectivists draw sharper distinctions between the groups they belong to and those they do not belong to. They may go above and beyond for their in-group members while acting much more competitively and aggressively toward out-group members. This tendency has important work implications. While individualists may evaluate the performance of their colleagues more accurately, collectivists are more likely to be generous when evaluating their in-group members. Freeborders, a software company based in San Francisco that eventually merged with the company Symbio,[115] found that even though it was against company policy, Chinese employees were routinely sharing salary information with their coworkers. This situation led them to change their pay system by standardizing pay at job levels and then giving raises after more frequent appraisals.[116] Collectivistic societies emphasize conformity to the group. The Japanese saying “the nail that sticks up gets hammered down” illustrates that being different from the group is undesirable. In these cultures, disobeying or disagreeing with one’s group is difficult and people may find it hard to say no to their colleagues or friends. Instead of saying no, which would be interpreted as rebellion © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Cultures where people have stronger bonds to their groups, and group membership forms a person’s self identity. Shutterstock.com 62 Organizational Behavior or at least be considered rude, they may use indirect ways of disagreeing, such as saying “I have to think about this” or “this would be difficult.” Such indirect communication prevents the other party from losing face but may cause misunderstandings in international communications with cultures that have a more direct style. Collectivist cultures may have a greater preference for team-based rewards as opposed to individual-based rewards.[117] Further, different management techniques are suitable in individualistic versus collectivistic cultures. For example, giving employees control over their jobs was more effective in reducing stress in individualistic cultures, whereas utilizing participative management was more effective in collectivistic cultures.[118] Power Distance power distance The degree to which the society views an unequal distribution of power as acceptable. Power distance refers to the degree to which the society views an unequal distribution of power as acceptable. Simply put, some cultures are more egalitarian than others. In low power distance cultures, egalitarianism is the norm. In high power distance cultures, people occupying more powerful positions such as managers, teachers, or those who are older are viewed as more powerful and deserving of a higher level of respect. High power distance cultures are hierarchical cultures where everyone has their place. Powerful people are supposed to act powerful, while those in inferior positions are expected to show respect. For example, Thailand is a high power distance culture and, starting from childhood, people learn to recognize who is superior, equal, or inferior to them. When passing people who are more powerful, individuals are expected to bow, and the more powerful the other person, the deeper the bow would be.[119] Managers in high power distance cultures are treated with a higher degree of respect, which may surprise those in lower power distance cultures. A Citibank manager in Saudi Arabia was surprised when employees stood up every time he passed by.[120] Similarly, in Turkey, students in elementary and high schools greet their teacher by standing up every time the teacher walks into the classroom. In these cultures, referring to a manager or a teacher by their first name would be extremely rude. High power distance within a culture may easily cause misunderstandings with those from low power distance societies. For example, in the cases of a limp handshake from someone in India or a job candidate from Chad who is looking at the floor throughout the interview, these candidates are in fact showing their respect, but their behaviors may be interpreted as indicating a lack of confidence or even disrespect in low power distance cultures. One of the most important ways in which power distance is manifested in the workplace is that in high power distance cultures, employees are unlikely to question the power and authority of their manager, and conformity to the manager will be expected. Managers in these cultures may be more used to an authoritarian style with lower levels of participative leadership demonstrated. People will be more submissive to their superiors and may take orders without questioning the manager.[121] In these cultures, management practices that encourage employee involvement are less effective.[122] Instead, these cultures seem to prefer paternalistic leaders—leaders who are authoritarian but make decisions while showing a high level of concern toward employees as if they were family members.[123] Further, in groups where power distance is high, displaying a humble leadership style involving admitting one’s mistakes and limitations has not been found to be an effective leadership style for achieving psychological safety in the team.[124] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work FIGURE 2.3 Cultural Risk: When in Rome Source: Image courtesy of D. Ketchen and J. Short, Mastering Strategic Management, (Boston: FlatWorld 2020); © Shutterstock © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 63 64 Organizational Behavior Uncertainty Avoidance uncertainty avoidance The degree to which people feel threatened by ambiguous, risky, or unstructured situations. Uncertainty avoidance refers to the degree to which people feel threatened by ambiguous, risky, or unstructured situations. Cultures high in uncertainty avoidance prefer predictable situations and have low tolerance for ambiguity. Employees in these cultures expect a clear set of instructions and clarity in expectations. Therefore, there will be a greater level of creating procedures to deal with problems and writing out expected behaviors in manuals. Cultures high in uncertainty avoidance prefer to avoid risky situations and attempt to reduce uncertainty. For example, one study showed that when hiring new employees, companies in high uncertainty avoidance cultures are likely to use a larger number of tests, conduct a larger number of interviews, and use a fixed list of interview questions.[125] Employment contracts tend to be more popular in cultures higher in uncertainty avoidance compared to cultures low in uncertainty avoidance.[126] The level of change-oriented leadership seems to be lower in cultures higher in uncertainty avoidance.[127] Companies operating in high uncertainty avoidance cultures also tend to avoid risky endeavors such as entering foreign target markets unless the target market is very large.[128] Germany is an example of a high uncertainty avoidance culture where people prefer structure in their lives and rely on rules and procedures to manage situations. Similarly, Greece is a culture relatively high in uncertainty avoidance, and Greek employees working in hierarchical and rule-oriented companies report lower levels of stress.[129] In contrast, cultures such as Iran and Russia are lower in uncertainty avoidance, and companies in these regions do not have rule-oriented cultures. When they create rules, they also selectively enforce rules and make a number of exceptions to them. In fact, rules may be viewed as constraining. Uncertainty avoidance may influence the type of organizations employees are attracted to. Japan’s uncertainty avoidance is associated with valuing job security, while in uncertainty-avoidant Latin American cultures, many job candidates prefer the stability of bigger and well-known companies with established career paths. Aggressive-Nurturing (Masculinity–Femininity) masculine (aggressive) cultures Cultures that value achievement, competitiveness, and acquisition of money and other material objects. feminine (nurturing) cultures Cultures that value maintaining good relationships, caring for the weak, and emphasizing quality of life. The terms masculinity and femininity may be misleading as gender is not a determinant of one’s culture. Therefore, we are following the trend toward more accurately referring to this dimension as aggressive-nurturing. However, where the research exists using the other terms, we have included both. Masculine (aggressive) cultures are cultures that value achievement, competitiveness, and acquisition of money and other material objects. Japan and Hungary are examples of masculine cultures. Masculine cultures are also characterized by a separation of gender roles. In these cultures, men are more likely to be assertive and competitive compared to women. In contrast, feminine (nurturing) cultures are cultures that value maintaining good relationships, caring for the weak, and emphasizing quality of life. In these cultures, values are not separated by gender, and both women and men share the values of maintaining good relationships. Sweden and the Netherlands are examples of nurturing cultures. The level of masculinity inherent in the culture has implications for the behavior of individuals as well as organizations. For example, in aggressive cultures, the ratio of CEO pay to other management-level employees tends to be higher, indicating that these cultures are more likely to reward CEOs with higher levels of pay as opposed to other types of rewards.[130] The nurturing nature of a culture affects many work practices, such as the level of work/life balance. In cultures high in nurturing, such as Norway and Sweden, work arrangements such as telecommuting seem to be more popular compared to cultures higher in aggression such as Italy and the United Kingdom. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work OB Toolbox: Prepare Yourself for a Global Career Shutterstock.com With the globalizing economy, boundaries with respect to careers are also blurring. How can you prepare yourself for a career that crosses national boundaries? • Learn a language. If you already know that you want to live in China after you finish school, now may be the time to start learning the language. It is true that business is often conducted in English, but it is becoming increasingly ethnocentric to speak only one language while many in the rest of the world can speak two or more. For example, 20% of those living in the United States can speak their native language plus another language fluently, and 56% of Europeans speak two or more languages.[131] Plus, even if business is conducted in English and it is your first language, your adaptation to a different society, making friends, and leading a satisfying life will be much easier if you can speak more than one language. • Immerse yourself in different cultures. Visit different cultures. This does not mean visiting five countries in five days. Plan on spending more time in one locale, and get to know, observe, and understand the culture. Better yet, take advantage of study abroad programs, doing an internship, or volunteering abroad. These programs give you a reason to get integrated into the culture and interact with locals in a professional capacity. • Develop an openness to different experiences. Be open to different cuisines, different languages, and different norms of working and living. If you feel very strongly that your way of living and working is the right way, you will have a hard time adjusting to a different culture. • Develop a strong social support network. Once you arrive in the culture you will live in, be proactive in making friends. Being connected to people in a different culture will have an influence on your ability to adjust to living there. If you are planning on taking family members with you, their level of readiness will also influence your ability to function within a different culture. • Develop a sense of humor. Adjusting to a different culture is often easier if you can laugh at yourself and the mistakes you make. If you take every mistake too personally, your stay will be less enjoyable and more frustrating. • Plan your return. If you have plans to come back and work in your home country, you will need to plan your return in advance. When people leave home for a long time, they often adapt to the foreign culture they live in and may miss many elements of it when they go back home. Your old friends may have moved on, local employers may not immediately appreciate your overseas experience, and you may even find that cultural aspects of your home country may have changed in your absence. Be ready for a reverse culture shock! Strength of Norms: Tightness-Looseness of Culture Hofstede’s five dimensional framework is influential and a useful way of thinking about culture. This framework describes cultural differences by referencing differences in five core values. A more recent and complementary way of thinking about culture instead describes it with respect to how tightly or loosely cultural values are held. This conceptualization is referred to as tightness-looseness of culture, which refers to strength of social norms that reside in a culture. In tight cultures, norms are highly pervasive, visible, and the society does not tolerate deviance from these norms. In © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 65 66 Organizational Behavior looser cultures, norms are more divergent, and there is a much greater tolerance for behavior that deviates from norms. Japan, Singapore, and South Korea are examples of tight cultures, whereas Estonia, Ukraine, and Hungary are loose, with the United States somewhere between two extremes. Research has shown that cultural tightness and looseness has past reasons such as historical conflicts, resource scarcity, and a history of contagious diseases tightening cultures.[132] Tightness and looseness affects everyday behavior of people raised in a particular culture. Michele Gelfand, a cross-cultural psychologist at the University of Maryland who is well known for her work on tight and loose cultures and the author of the book Rule Makers, Rule Breakers, describes both tightness and looseness as having value at different times. The greater tolerance for a diverse set of values and behaviors grants loose cultures an advantage with respect to creativity and innovation. However, she explained that when dealing with a crisis such as COVID-19 where coordination across the whole nation is valuable, the same cultural traits serve as a downside. She attributed the difficulties local authorities experienced in controlling the COVID-19 pandemic in the United States to the looseness of culture.[133] Understanding tightness and looseness of a culture is also useful in understanding how open to change a society is, what type of leadership individuals in a society will feel more comfortable with, and how harsh they will be when they confront someone who deviates from norms. The Secret Life of Social Norms Michele Gelfand, University of Maryland View in the online reader Suggestions for Managing Cultural Diversity With the increasing importance of international business as well as the culturally diverse domestic workforce, what can organizations do to manage cultural diversity? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work 67 Develop a Global Mindset Global mindset is a person’s openness to learning about other cultures and ability to communicate across cultural boundaries. Developing a global mindset is important because the days when organizations could prepare their employees for international work simply by sending them to long seminars on a particular culture are gone. Presently, international business is not necessarily conducted between pairs of countries. A successful domestic manager is not necessarily assigned to work on a long-term assignment in China. Of course such assignments still happen, but it is more likely that the employees will continually work with others from diverse cultural backgrounds. This means employees will not necessarily have to become experts in one culture. Instead, they should have the ability to work with people from many diverse backgrounds all at the same time. For these types of assignments, employees will need to develop an awareness of overall cultural differences and learn how to recognize cultural principles that are operating in different situations. In other words, employees will need to be selected based on cultural sensitivity and understanding and trained to enhance such qualities.[134] For example, GlobeSmart by Aperian Global is an online tool that helps employees learn how to deal with people from around the world. The process starts by completing a survey about your cultural values, and then these values are compared to those of different cultures. The tool provides specific advice about interpersonal interactions with these cultures.[135] global mindset A person's openness to learning about other cultures and communicating effectively in different cultural contexts. Avoid Ethnocentrism Ethnocentrism is the belief that one’s own culture is superior to other cultures one comes across. Ethnocentrism leads organizations to adopt universal principles when doing business around the globe, which may backfire. In this chapter, we highlighted research findings showing how culture affects employee expectations of work life such as work-life balance, job security, or the level of empowerment. Ignoring cultural differences, norms, and local habits may be costly for businesses and may lead to unmotivated and dissatisfied employees. Successful global companies modify their management styles, marketing, and communication campaigns to fit with the culture in which they are operating. For example, Disney-owned Pixar was praised for its culturally sensitive treatment of cultural traditions in the movie Coco. The company used numerous cultural consultants and sought feedback throughout all stages of the creative process.[136] Listen to Locals When doing cross-cultural business, locals are a key source of information. To get timely and accurate feedback, companies will need to open lines of communication and actively seek feedback. For example, Convergys, a Cincinnati-based call-center company that was acquired by Synnex Corporation in 2018,[137] built a cafeteria for the employees in India. During the planning phase, the Indian vice president pointed out that because Indian food is served hot and employees would expect to receive hot meals for lunch, building a cafeteria that served only sandwiches would create dissatisfied employees. By opening the lines of communication in the planning phase of the project, Convergys was alerted to this important cultural difference in time to change the plans.[138] Recognize That Culture Evolves Cultures are not static—they evolve over the years. A piece of advice that was true five years ago may no longer hold true. For example, in the deeply conservative Saudi Arabia, the ban on women’s driving was lifted in 2017, and the country allowed the screening of the movie Black Panther in 2018, © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. ethnocentrism The belief that one’s own culture is superior to other cultures one comes across. 68 Organizational Behavior which was the first movie screening in more than 30 years. These changes are just two examples of how businesses need to continuoually update their knowledge about different cultures.[139] Do Not Always Assume That Culture Is the Problem When doing business internationally, failure may occur due to culture as well as other problems. Attributing all misunderstandings or failures to culture may enlarge the cultural gap and shift the blame to others. In fact, managing people who have diverse personalities or functional backgrounds may create misunderstandings that are not necessarily due to cultural differences. When marketing people from the United States interact with engineers in India, misunderstandings may be caused by the differences in perceptions between marketing and engineering employees. While familiarizing employees about culture, emphasizing the importance of interpersonal skills regardless of cultural background will be important. Key Takeaway With the increasing prevalence of international business as well as diversification of the domestic workforce in many countries, understanding how culture affects organizational behavior is becoming important. Individualism-collectivism, power distance, uncertainty avoidance, and masculinity–femininity are four key dimensions in which cultures vary. The position of a culture on these dimensions affects the suitable type of management style, reward systems, employee selection, and ways of motivating employees. What do you think? 1. What is culture? Do countries have uniform national cultures? 2. How would you describe your own home country’s values on the four dimensions of culture? 3. Reflect on a time when you experienced a different culture or interacted with someone from a different culture. How did the cultural differences influence your interaction? 4. How does culture influence the proper leadership style and reward system that would be suitable for organizations? 5. Imagine that you will be sent to live in a foreign country different from your own in a month. What are the types of preparations you would benefit from doing? 2.4 Focus on Diversity, Ethics, Technology, and National Culture Learning Objectives 1. Consider the relationship between diversity and ethics. 2. Consider the relationship between diversity and technology. 3. Consider the role of national culture in diversity. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work 69 Diversity and Ethics When managing a diverse group of employees, ensuring the ethicality of organizational behavior will require special effort. This is because employees with different backgrounds or demographic traits may vary in their standards of ethics. For example, research shows that there are some gender differences when it comes to evaluating the degree of ethicality of hypothetical scenarios, with women utilizing higher standards. Men and women seem to have similar standards when judging the ethicality of monetary issues but differ on issues such as the ethicality of breaking organizational rules. Interestingly, gender differences seem to disappear as people grow older. Age is another demographic trait that influences the standards of ethics people use, with older employees being bothered more by unethical behaviors compared to younger employees. Similarly, one study showed that older respondents found some questionable negotiation behaviors such as misrepresenting information and bluffing to be more unethical compared to younger respondents.[140] In addition to demographic diversity, cultural diversity introduces challenges to managing ethical behavior, given that cultures differ in the actions they view as ethical. Cultural differences are particularly important when doing cross-cultural business. For example, one study compared Russian and American subjects on their reactions to ethics scenarios. Americans viewed scenarios such as an auditing company sharing information regarding one client with another client as more unethical compared to how Russian subjects viewed the same scenarios.[141] A study comparing U.S., Korean, and Indian managers found differences in attitudes toward business ethics, particularly with Koreans thinking that being ethical was against the goal of being profitable. Indian and Korean subjects viewed questionable practices such as software piracy, nepotism, or the sharing of insider information as relatively more ethical compared to subjects in the United States. At the same time, Korean and Indian subjects viewed injury to the environment as more unethical compared to the U.S. subjects.[142] In other words, the ethical standards held in different societies may emphasize different behaviors as ethical or unethical. When dealing with unethical behavior overseas, companies will need to consider the ethical context. Having internal reporting mechanisms may help, but research shows that in very high power distant societies, these mechanisms often go unused.[143] Even when a multinational company has ethical standards that are different from local standards, using the headquarters’ standards in all cross-cultural interactions will not be possible or suitable. The right action often depends on the specifics of the situation and a consideration of the local culture. For example, in the 1990s, Levi-Strauss & Company found that some of its contractors in Bangladesh were using child labor consisting of children under 14 years old in its factories. One option they had was to demand that their contractors fire those children immediately. Yet, when they looked at the situation more closely, they found that it was common for young children to be employed in factories, and in many cases these children were the sole breadwinners in the family. Firing these children would have caused significant hardship for the families and could have pushed the children into more dangerous working conditions. Therefore, Levi-Strauss reached an agreement to send the children back to school while continuing to receive their wages partly from the contractor companies and partly from Levi-Strauss. The school expenses were met by Levi-Strauss and the children were promised work when they were older. In short, the diverse ethical standards of the world’s cultures make it unlikely that one approach can lead to fair outcomes in all circumstances. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Shutterstock.com 70 Organizational Behavior Diversity and Technology Artificial intelligence and machine learning are being quickly and enthusiastically embraced in the field of recruitment and selection. Artificial intelligence (AI) refers to technology that performs some of the decision making functions of humans, such as learning and problem solving. A subset of artificial intelligence is machine learning, or a computer algorithm that automatically learns and improves over time as it analyzes more data. Companies are able to use AI to sort through résumés, select which job candidates to interview, or even which job candidates see the company’s job advertisements. No doubt these tools save companies time and money. Shutterstock.com artificial intelligence Technology that performs some of the decision making functions of humans. machine learning A computer algorithm that automatically learns and improves over time as it analyzes more data. AI and machine learning have important implications for diversity and inclusion, and the quick and unquestioning embracing of these technologies necessitates caution. These technologies have the veneer of being scientific. They essentially analyze patterns in an existing dataset to identify the characteristics that are related to performance, retention, and other outcomes companies care about. However, these technologies are only as good as the data that are being used to train the algorithm. As a case in point, in 2018, Amazon abandoned work on their AI recruitment tool that had been in development for the past four years. The AI had learned to analyze résumés to decide which ones would be desirable to Amazon recruiters. However, the real data the AI was using to learn from and make predictions from came from a highly male dominated workforce. Not surprisingly, the AI had learned that there was a preference for male résumés, and had decided to systematically downgrade résumés from women, assigning résumés revealing a female candidate (such as membership in women’s chess club or graduation from an all-female college) lower scores. Amazon was willing to question and rectify what the AI was doing, which eventually meant abandoning the project. What is more troublesome is that these algorithms are not transparent to decision makers, and many end users are not as highly motivated or skilled to be able to look “under the hood” to see which criteria the algorithm is learning to use.[144] AI and machine learning are here to stay and they have the promise to make positive contributions to organizations. For example, they can speed up résumé screening by quickly searching through particular keywords and eliminate some mistakes human decision makers can introduce. It can alert decision makers when a job posting contains male or female biased words.[145] Ultimately, how technology affects diversity and inclusion depends on how it is used, and its users need to be knowledgable about their promise, as well as their limitations. Diversity Around the Globe Shutterstock.com Demographic diversity is a fact of life in the United States. The situation is somewhat different in other parts of the world. Attitudes toward gender, race, disabilities, or sexual orientation differ around the world, and each country approaches the topic of diversity differently. As a case in point, Japan is a relatively homogeneous society that sees the need to diversify itself. With the increasing age of the population, the country expects to lose 650,000 workers per year. At the same time, the country famously underutilizes female employees. Overt sexism is rampant, and stereotypes about female employees as unable to lead are part of the culture. While there is anti-discrimination legislation and the desire of the Japanese government to deal with this issue, women are seriously underrepresented in management. The country has the second fewest percentage of women in managerial positions (11.5%), following S. Korea (10.7%).[146] At the same time, countries are not static, and they change and evolve over time in response to economic factors and current events. For example, Saudi Arabia’s Vision 2030 initiative seeks to diversify the economy to make them less reliant on oil. The initiative seeks to increase women’s labor force participation from 22 to 30%. The conservative country has been relaxing some barriers to employment such as allowing women to drive for the first time in 2017. These changes are slowly changing the face of workplaces there.[147] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work Attitudes toward concepts such as affirmative action are also culturally determined. For example, France experiences different employment situations for employees with different backgrounds. According to one study conducted by a University of Paris professor in which fake résumés were sent to a large number of companies, even when all qualifications were the same, candidates with French-sounding names were three times more likely to get a callback compared to those with North African sounding names. However, affirmative action is viewed as unfair in French society, leaving the situation in the hands of corporations. Some companies such as PSA Peugeot Citroën started utilizing human resource management systems in which candidate names are automatically stripped from résumés before HR professionals personally investigate them.[148] In summary, due to differences in the legal environment as well as cultural context, “managing diversity effectively” may carry a different meaning across the globe. Key Takeaway Ethical behavior is affected by the demographic and cultural composition of the workforce. Studies indicate that men and women, as well as younger and older employees, differ in the types of behaviors they view as ethical. Different cultures also hold different ethical standards, which become important when managing a diverse workforce or doing business within different cultures. Around the globe, diversity has a different meaning and different overtones. In addition to different legal frameworks protecting employee classes, the types of stereotypes that exist in different cultures and whether and how the society tackles prejudice against different demographic categories vary from region to region. What do you think? 1. Do you believe that multinational companies should have an ethics code that they enforce around the world? Why or why not? 2. What are the barriers to global organizations having uniform policies around diversity and inclusion in their offices around the world? 3. In your opinion, what is the connection between the technology industry’s lack of diversity and the potential negative implications of technology for workplace diversity? 4. How can organizations manage a workforce with diverse personal ethical values? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 71 72 Organizational Behavior 2.5 Equality as a Core Value: The Case of Salesforce.com DW labs Incorporated/Shutterstock.com The San Francisco–based Customer Relationship Management (CRM) company Salesforce.com is unique in many ways. The founder and CEO, Marc Benioff, is known for his vision for philanthropy, which has been encoded into the 1-1-1 system embraced by the company. Specifically, Salesforce pledges to give back 1% of its equity, products, and employee hours back to communities in which they operate. Given the visionary leadership focusing on social issues, perhaps it is not surprising that diversity is one of the four core values of Salesforce. Except that instead of diversity, the company uses the term “equality.” The company breaks with the tradition of appointing a Chief Diversity Officer, opting for a “Chief Equality Officer.” This is a deliberate choice on the part of the company. The company’s Chief Equality Officer, Tony Prophet, explains why diversity by itself is not enough: “Diversity is absolutely essential, and we have work to do that, but once you have diversity you’re not done. Then you have inclusion where you’re really getting the very best out of every employee. When you have an inclusive environment, you feel seen, you feel included, and you feel valued. You feel like you can bring your whole self to work. That is a competitive advantage to have a larger pool of talent. When you get ideas from people with different perspectives, the result is the beauty and the melding of their ideas, which adds to the complexity of the mosaic.” The company strives to cultivate a culture of Ohana (the word for “family” in Hawaiian language). It views inclusion as an ongoing goal to be strived for, and it deploys numerous tools and resources to achieve this goal. For example, the company currently has 12 Employee Resource Groups called Ohanas. These groups include Abilityforce (aiming to achieve an inclusive culture for people of all abilities and disabilities), Outforce (promoting an open and inclusive culture for employees of all sexual orientations and gender identities), and Faithforce (bringing together employees of all faiths). The goal of these groups is to ensure that employees can bring their whole, authentic selves to work. Half of the employees participate in at least one of these groups, with the goal that all senior executives are connected to one as an ally. A key tool the company uses to ensure equality is to collect and use data to assess the status quo, identify areas for improvement, and take action. In 2015, the company made the news and spent $3 million to rectify their discovered gender pay gap. After their analysis revealed pay differences that could not be explained by geography, seniority, and responsibilities, they made adjustments to the pay of 17,000 employees (men and women), representing 6% of the company’s workforce. They have since done an equal pay assessment every year. As of 2020, the company had spent over $12 million in addressing pay differences. The company publishes diversity numbers annually and measures the level of inclusiveness through questions in their attitude surveys. The company supports numerous programs as part of its inclusive culture. A high-potential leadership program aims to provide leadership skills in order to help the advancement of women in the workplace. Coding workshops for girls seek to demystify programming for girls around the world. The annual equality award announced in their annual developer conference aims to raise © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 2 Diversity and Inclusion at Work the profile of diversity and inclusiveness trailblazers from all industries. The company views equality both as a key social issue to help create a better world, and a source of competitive advantage for their own success.[149] Multimedia Extension—Proudly Me View in the online reader Case Discussion Questions 1. Why do you think Salesforce is committed to equality as a core value? 2. What are your thoughts regarding the distinction between diversity and inclusion (or equality, as it is called in the case)? Do you believe diversity without inclusion can be effective? Or inclusion without diversity? 3. Salesforce clearly puts a lot of resources into ensuring inclusiveness. Which of the methods described in the case are applicable to a smaller business with more limited resources? Do you believe that effective management of diversity necessitates a resource-rich environment? 4. The company had to rectify a gender pay gap twice. What would be your advice for companies aiming to achieve pay fairness? What are ways in which companies may structure their pay systems so that gender pay gap does not emerge in the first place? 5. What is the value of employee resource groups? Under which conditions do you believe such programs will be effective tools in helping to develop an inclusive culture? 2.6 Conclusion In conclusion, in this chapter we reviewed the implications of demographic and cultural diversity for organizational behavior. Management of diversity effectively promises a number of benefits for companies and may offer a competitive advantage. Yet challenges such as natural human tendencies to associate with those similar to us and using stereotypes in decision making often act as barriers to achieving this goal. By creating a work environment where people of all origins and traits feel welcome, organizations will make it possible for all employees to feel engaged with their work and remain productive members of the organization. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 73 74 Organizational Behavior 2.7 Exercises Ethical Dilemma You are working for the fire department of your city. When hiring employees, the department uses a physical ability test in which candidates are asked to do 30 push-ups and 25 sit-ups, as well as climb over a 4-foot wall. When candidates take this test, it seems that about 80% of the men who take the test actually pass it, while only 10% of the women pass the test. Do you believe that this is a fair test? Why or why not? If you are asked to review the employee selection procedures, would you make any changes to this system? Why or why not? Individual Exercise A colleague of yours is being sent to India as a manager for a call center. She just told you that she feels very strongly about the following issues: • Democratic leaders are the best leaders because they create a more satisfied workforce. • Employees respond best to individual-based pay incentives and bonuses as tools for motivation. • Employees should receive peer feedback about their performance level so that they can get a better sense of how well they are performing. After doing some research on the business environment and national culture in India, how would you advise your colleague to behave? Should she try to transfer these three managerial practices to the Indian context? Why or why not? Group Exercise Diversity Dilemmas Imagine that you are working in the HR department of your company. You come across the following scenarios in which your input has been sought. Discuss each scenario and propose an action plan for management. What would an inclusive response look like? 1. Aimee is the mother of a newborn. She is very dedicated to her work but she used to stay for longer hours at work before she had her baby. Now she tries to schedule her work so that she leaves around 5:00 pm. Her immediate manager feels that Aimee is no longer dedicated or committed to her work and is considering passing her over for a promotion. 2. Jack is a married man, while John is single. Your company has an assignment in a branch in Mexico that would last for a year. Management feels that John would be better for this assignment because he is single and is free to move. 3. A manager receives a request from an employee to take off on Wednesday for religious reasons. The manager did not know that this employee was particularly religious and does not believe that the leave is for religious reasons. The manager believes that the employee is going to use this day as a personal day off. 4. A sales employee has painful migraines intermittently during the work day. She would like to take short naps during the day as a preventative measure, and she also needs a place where she can nap when a migraine occurs. Her immediate manager feels that this is unfair to the rest of the employees. 5. A department is looking for an entry-level cashier. One of the job applicants is a cashier with 30 years of experience. The department manager feels that this candidate is overqualified for the job and is likely to be bored and leave the job in a short time. Instead, they want to © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 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France seeks path to workplace diversity: Employers, politicians wrestle with traditions that make integration a difficult process. Wall Street Journal, p. A2. 149. Case written by Talya Bauer and Berrin Erdogan to accompany Bauer, T. N., & Erdogan, B. (2021). Organizational Behavior: Bridging Science and Practice (4.0). Boston, MA: FlatWorld. Partially based on ideas and information contained in Carroll, A. (March 29, 2018). Putting women and education first with Bridge21 and Salesforce. Irish Tech News; Donnelly, G. (September 25, 2017). Kaiser Permanente, GoDaddy, and SalesForce execs share how they’re promoting diversity and inclusion. Fortune; Dunn, K. (Jan/Feb 2017). The Salesforce pitch for equity, equality. Workforce, 96 (1); Jackson, A. E. (March 20, 2017). Why Salesforce’s new equality chief is thinking beyond diversity. Fast Company. Retrieved https://www.fastcompany.com/3069082/why-salesforces-new-equality-chief-is-thinkingbeyond-diversity; McGirt, E. (July 13, 2017). Salesforce’s Chief Equality Officer: Here’s how you promote diversity at work. Fortune; Zarya, V. (July 12, 2016). Salesforce spent $3 million on equal pay: Here's how many employees got raises as a result. Fortune; Salesforce. (n.d.) Retrieved from https://www.salesforce.com/company/equality/; Hyder, B. (2020, March 31). 2020 Salesforce equal pay update. Retrieved from https://www.salesforce.com/company/news-press/stories/2020/3/salesforce-equal-pay/#:~:text=That's why in 2015, Salesforce,gaps among gender and race.&text=The assessment found seven percent of employees required equal pay adjustments. CHAPTER 3 Individual Differences and Perception at Work Shutterstock.com Learning Objectives After reading this chapter, you should be able to do the following: 1. Define personality and describe how it affects work behaviors. 2. Understand the role of values in determining work behaviors. 3. Explain the process of perception and how it affects work behaviors. 4. Understand connections between individual differences and perception at work and ethics, technology, and cross-cultural management. Individuals bring a number of differences to work, such as unique personalities, values, emotions, and moods. When new employees enter organizations, their stable or transient characteristics affect how they behave and perform. Moreover, companies hire people with the expectation that those individuals have certain skills, abilities, personalities, and values. Therefore, it is important to understand individual characteristics that matter for employee behaviors at work. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 80 Organizational Behavior 3.1 Individuals Bringing Their Full Selves to Work: The Case of Fully Source: Used with permission by Fully Fully is a certified B Corp in Portland, Oregon, that sources, designs, manufactures, and sells ergonomic office furniture. As a B Corp, Fully meets the highest standards of overall social and environmental performance, transparency, and accountability, and aspires to use the power of business to solve social and environmental problems. David Kahl, founder of Fully, began his career as an accountant. He was working in Manhattan during the terrorist attacks of September 11, 2001. In the days that followed, Kahl, along with most New Yorkers, walked to and from work because the subway was shut down. Thanks to this, and perhaps due to the trauma of 9/11, Kahl saw a community emerge in Manhattan in a way he had never before observed. People naturally stopped to hold conversations on the sidewalk, showing genuine concern for one another. The events of that week led Kahl to question whether his career was sufficiently fulfilling, so he spontaneously quit to pursue more meaningful work. For Kahl, this pursuit would lead him to Portland where he began Fully with a vision to enable customers to live fully in their bodies and bring their full, active selves to work and life. This mission extends beyond Fully’s product line. The company embodies these values within its own culture, as well. People who work at Fully are encouraged to be their unique, authentic, and quirky selves all the time (including, and especially, while at work). Employees can bring their dogs to the office with them, they are paid to volunteer for causes they care about, and they treat the office as a playground with plenty of interesting pieces of furniture they can use to keep their bodies moving throughout the day. The idea is that when people move, they feel more present, engaged, and alive. This facilitates stronger and more genuine connections between individuals in the workplace. Kahl has learned a lot about leadership by enabling his employees to bring their whole selves to work, saying, “I started to realize that if you take your time to hire really good people—and trust that they can do the job and bring their own approach and perspective to their work—it can be freeing.” By allowing his employees to be truly themselves, they bring a stronger sense of motivation and creativity to their roles, in some cases doing things better or more efficiently than Kahl did them when he first started Fully. This has allowed him to focus less on operational responsibilities, freeing up his time to think more strategically.[1] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work Multimedia Extension—Bringing Your Full Self to Work | We Are Fully View in the online reader Case Discussion Questions 1. How did David Kahl’s unique life experiences lead to his endeavor to start Fully? 2. What are some unique, individual attributes that make you who you are? Do you feel like you can bring these sides of yourself to work or school? Explain. 3. When individuals are encouraged to bring their whole selves to work, what do you think might be the impact on productivity? How about on employee turnover? 4. Would you want to work for a company like Fully that encourages you to be your authentic self at work? Why or why not? 5. How does Fully’s mission influence how the organization is run? What are some important factors that determine how a company’s mission is carried out on a daily basis? 3.2 The Interactionist Perspective: The Role of Fit Learning Objectives 1. Differentiate between person–organization and person–job fit. 2. Understand the relationship between person–job fit and work behaviors. 3. Understand the relationship between person–organization fit and work behaviors. Individual differences matter in the workplace. Human beings bring their personality, physical and mental abilities, and other stable traits to work. Imagine that you are interviewing an employee who is proactive, creative, and willing to take risks. Would this person be a good job candidate? What behaviors would you expect this person to demonstrate? The question posed above is misleading. While human beings bring their traits to work, every organization is different, and every job within the organization is also different. According to the © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 81 82 Organizational Behavior interactionist perspective, behavior is a function of the person and the situation interacting with each other. Think about it. Would a shy person speak up in class? While a shy person may not feel like speaking, if the individual is very interested in the subject, knows the answers to the questions, and feels comfortable within the classroom environment, and if the instructor encourages participation and participation is 30% of the course grade, regardless of the level of shyness, the student may feel inclined to participate. Similarly, the behavior you may expect from someone who is proactive, creative, and willing to take risks will depend on the situation. person–organization fit The degree to which a person’s values, personality, goals, and other characteristics match those of the organization. person–job fit The degree to which a person’s skill, knowledge, abilities, and other characteristics match the job demands. overqualification The degree to which a person's skill, knowledge, abilities, and other characteristics exceed the job requirements. When hiring employees, companies are interested in assessing at least two types of fit. Person–organization fit refers to the degree to which a person’s values, personality, goals, and other characteristics match those of the organization. Person–job fit is the degree to which a person’s skill, knowledge, abilities, and other characteristics match the job demands. Thus, someone who is proactive and creative may be a great fit for a company in the high-tech sector that would benefit from risk-taking employees, but may be a poor fit for a company that rewards routine and predictable behavior, such as an accounting firm. Similarly, this person may be a great fit for a job such as a scientist, but a poor fit for a routine office job. The first thing many recruiters look for is the degree of person–job fit. This is not surprising, because person–job fit is related to a number of positive work attitudes such as satisfaction with the work environment, identification with the organization, job satisfaction, and work behaviors such as job performance. Companies are often also interested in hiring candidates who will fit into the company culture (those with high person–organization fit). When people fit into their organization, they tend to be more satisfied with their job, more committed to their company, and less likely to experience burnout, and they actually remain longer in their company.[2] Further, applicants who believe that they fit with the organization during the stages of recruitment are more attracted to the firm and are more likely to accept an offer by that company.[3] One area of controversy is whether these people perform better. Some studies have found a positive relationship between person–organization fit and job performance, but this finding was not present in all studies, so it seems that fitting with a company’s culture will only sometimes predict job performance.[4] It also seems that fitting in with the company culture is more important to some people than to others. For example, people who are in more advanced stages of their careers are more strongly affected by their level of person–organization fit.[5] Also, when they build good relationships with their supervisors and the company, being a “misfit” does not seem to lead to dissatisfaction on the job.[6] A special case of not fitting one’s job is being overqualified for the job. Overqualification is a situation in which the employee has more skills, education, and experience than the job requires. People take jobs for which they are overqualified for a number of reasons, including a lack of alternatives, to gain entry into a new field, or not realizing that the job is actually below their skill level. Research shows that overqualification is related to negative job attitudes, greater tendency to look for another job, and higher likelihood of counterproductive behaviors. At the same time, studies have shown that there are situations where overqualification is positively related to job performance, particularly when these employees work with other overqualified workers. Further, the negative effects of overqualification only seem to emerge when employees are not empowered and when employees do not fit with the organization’s culture. In other words, by allowing employees to control their work environment and have a say in how things are done at work, companies can benefit from these highly qualified workers.[7] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work 83 Key Takeaway While personality traits and other individual differences are important, we need to keep in mind that behavior is jointly determined by the person and the situation. Certain situations bring out the best in people, and someone who is a poor performer in one job may turn into a star employee in a different job. What do you think? 1. How can a company assess person–job fit before hiring employees? What are the methods you think would be helpful? 2. How can a company determine person–organization fit before hiring employees? Which methods do you think would be helpful? 3. What can organizations do to increase person–job and person–organization fit after they hire employees? 4. How do you think organizations react to overqualified workers? Are these candidates viewed as highly desirable job candidates? Why or why not? 3.3 Individual Differences: Values and Personality Learning Objectives 1. Understand what values are. 2. Describe the link between values and individual behavior. 3. Identify the major personality traits that are relevant to organizational behavior. 4. Explain the link between personality, work behavior, and work attitudes. 5. Explain the potential pitfalls of personality testing. Values Values refer to stable life goals that people have, reflecting what is most important to them. Values are established throughout one’s life as a result of the accumulating life experiences and tend to be relatively stable.[8] The values that are important to people tend to affect the types of decisions they make, how they perceive their environment, and their actual behaviors. Moreover, people are more likely to accept job offers when the company possesses the values people care about.[9] Value attainment is one reason why people stay in a company, and when an organization does not help them attain their values, they are more likely to decide to leave if they are dissatisfied with the job itself.[10] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. values Stable life goals people have, reflecting what is most important to them. 84 Organizational Behavior terminal values End states people desire in life, such as leading a prosperous life and a world at peace. instrumental values Views on acceptable modes of conduct, such as being honest and ethical, and being ambitious. What are the values people care about? There are many typologies of values. One of the most established surveys to assess individual values is the Rokeach Value Survey.[11] This survey lists 18 terminal and 18 instrumental values in alphabetical order. Terminal values refer to end states people desire in life, such as leading a prosperous life and a world at peace. Instrumental values deal with views on acceptable modes of conduct, such as being honest and ethical, and being ambitious. According to Rokeach, values are arranged in hierarchical fashion. In other words, an accurate way of assessing someone’s values is to ask them to rank the 36 values in order of importance. By comparing these values, people develop a sense of which value can be sacrificed to achieve the other, and the individual priority of each value emerges. TABLE 3.1 Sample Items from Rokeach (1973) Value Survey Terminal Values Instrumental Values A world of beauty Broad-minded An exciting life Clean Family security Forgiving Inner harmony Imaginative Self-respect Obedient Where do values come from? Research indicates that they are shaped early in life and show stability over the course of a lifetime. Early family experiences are important influences over the dominant values. People who were raised in families with low socioeconomic status and those who experienced restrictive parenting often display conformity values when they are adults, while those who were raised by parents who were cold toward their children would likely value and desire security.[12] Values of a generation also change and evolve in response to the historical context that the generation grows up in. It is important to keep in mind that generational differences, where they exist, are modest, and are not strong enough to justify treating different age groups differently in the workplace. At the same time, research identified some differences in the values of different generations. For example, Generation Xers (those born between 1965 and 1979) are thought to be more individualistic and are interested in working toward organizational goals so long as they coincide with their personal goals. This group, compared to the Baby Boomers (those born between 1946 and 1964), is also less likely to see work as central to their life and more likely to desire a quick promotion.[13] Millennials (those born between 1980 and 2000) value leisure more, report less work centrality than Boomers, and value work-life balance.[14] At the same time, the cut-offs between generations tend to be fuzzy, and the trends tend to be gradual.[15] Values will affect the choices people make. For example, someone who has a strong stimulation orientation may pursue extreme sports and be drawn to risky business ventures with a high potential for payoff. The values a person holds may affect their employment. For example, someone who has an orientation toward strong stimulation may pursue extreme sports and select an occupation that involves fast action and high risk, such as fire fighter, police officer, or emergency medical doctor. Someone who has a drive for achievement may more readily act as an entrepreneur. Moreover, whether individuals will be satisfied at a given job may depend on whether the job provides a way to satisfy their dominant values. Therefore, understanding employees at work requires understanding the value orientations of employees. Shutterstock.com © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work 85 Personality Personality encompasses the relatively stable feelings, thoughts, and behavioral patterns a person has. Our personality differentiates us from other people, and understanding someone’s personality gives us clues about how that person is likely to act and feel in a variety of situations. In order to effectively manage organizational behavior, an understanding of different employees’ personalities is helpful. Having this knowledge is also useful for placing people in jobs and organizations. personality The relatively stable feelings, thoughts, and behavioral patterns a person has. When scholars discuss personality characteristics as being “stable,” this does not mean that an individual’s personality exhibits no degree of change. You probably remember how you have changed and evolved as a result of your own life experiences, attention you received in early childhood, the style of parenting you were exposed to, successes and failures you had in high school, and other life events. In fact, our personality changes over long periods of time. For example, we tend to become more socially dominant, more conscientious (organized and dependable), and more emotionally stable between ages 20 and 40, whereas openness to new experiences tends to decline as we age.[16] In other words, even though we treat personality as relatively stable, over short periods of time, changes occur. Moreover, even in childhood, our personality shapes who we are and has lasting consequences for us. For example, studies show that part of our career success and job satisfaction later in life can be explained by our childhood personality.[17] Is our behavior in organizations dependent on our personality? Yes and no. While we will discuss the effects of personality for employee behavior, you must remember that the relationships we describe are modest correlations. For example, having a sociable and outgoing personality may encourage people to seek friends and prefer social situations. This does not mean that their personality will immediately affect their work behavior. At work, we have a job to do and a role to perform. Therefore, our behavior may be more strongly affected by what is expected of us, as opposed to how we want to behave. When people have a lot of freedom at work, their personality will become a stronger influence over their behavior.[18] Big Five Personality Traits How many personality traits exist? In the English language alone, more than 15,000 words describing personality have been identified. When researchers analyzed the terms describing personality characteristics, they realized that many different words might be used to describe a single dimension of personality. When these words were grouped, five dimensions seemed to emerge that explain a lot of the variation in our personalities.[19] The “Big Five” dimensions of Openness, Conscientiousness, Extraversion, Agreeableness, and Neuroticism can be remembered using the acronym OCEAN. Everyone has some degree of each of these traits; it is the unique configuration of how high a person rates on some traits and how low on others that produces the individual quality we call personality. Keep in mind that these five traits are not necessarily the only ones that exist. There are other, specific traits that represent dimensions not captured by the Big Five. Still, understanding the main five traits gives us a good start for describing personality. Openness is the degree to which a person is curious, original, intellectual, creative, and open to new ideas. People high in openness thrive in situations that require being flexible and learning new things. For example, in a study tracking individuals from childhood to the age of 64, childhood openness showed indirect effects on upward social mobility because these individuals were more likely to acquire higher levels of education.[20] As employees, they have an advantage when they enter into a new organization. Their open-mindedness leads them to seek a lot of information and feedback about how they are doing and to build relationships, which leads to quicker adjustment to the new job.[21] Open people are highly adaptable to change, and teams that experience unforeseen changes in their tasks do well if they are populated with people high in openness.[22] Compared to people low in openness, they are also more likely to start their own business.[23] One downside of © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. openness The degree to which a person is curious, original, intellectual, creative, and open to new ideas. 86 Organizational Behavior openness is that their absorption in creative pursuits has been shown to result in less time spent with spouses at home, which could lead to higher work-life conflict.[24] conscientiousness The degree to which a person is organized, systematic, punctual, achievement oriented, and dependable. extraversion The degree to which a person is outgoing, talkative, sociable, and enjoys being in social situations. Conscientiousness refers to the degree to which a person is organized, systematic, punctual, achievement oriented, and dependable. Conscientiousness is the one personality trait that uniformly predicts how high a person’s performance will be across a variety of occupations and jobs. Conscientiousness has advantages on and off the job. For example, conscientiousness measured during childhood predicts likelihood of unemployment in adulthood (with high conscientiousness predicting low unemployment).[25] Not surprisingly, conscientiousness is the trait most desired by recruiters, and highly conscientious applicants tend to succeed in interviews.[26] Once they are hired, conscientious employees not only tend to perform well, but they also have higher levels of motivation to perform, lower levels of turnover, lower levels of absenteeism, and higher levels of safety performance at work.[27] In other words, conscientious employees are highly desirable to businesses. In return, companies tend to reward those who have this trait, treating them in more fair and considerate ways.[28] Finally, conscientiousness is a particularly valuable trait for entrepreneurs. Highly conscientious people are more likely to start their own business compared with those who are not, and their firms have longer survival rates and better performance.[29] This trait is not without a downside, however. When they experience failure, such as in the form of unemployment, the wellbeing of conscientious people is much more negatively affected.[30] Extraversion is the degree to which a person is outgoing, talkative, sociable, and enjoys socializing. Interacting with others and being social energizes extraverts, whereas similar levels of stimulation and interactions may be viewed as draining to someone who is an introvert. Extraverts tend to be assertive, interpersonally dominant, seek sensation, enthusiastic, and are more likely to experience positive emotions as well. The overall evidence based on a large meta-analysis suggests that extraversion provides motivational, emotional, and interpersonal advantages to individuals at work, and most of its advantages are due to their higher enthusiasm, positive emotions, assertiveness, and dominance, whereas their sociability actually has fewer benefits, and sensation seeking is a downside.[31] One of the established findings is that extraverts tend to be effective in jobs involving sales. For example, when they force themselves to show “service with a smile,” they are more effective and convincing, which results in earning more tips from customers, whereas similar behaviors seem to backfire for introverts and result in less tips![32] Moreover, they tend to be effective as managers and they demonstrate inspirational leadership behaviors.[33] Extraverts tend to be effective in job interviews and even have higher starting salaries. Part of this success comes from preparation, as they are likely to reach out to their social network in order to prepare for the interview.[34] Extraverts have an easier time than introverts do when adjusting to a new job. Adjusting to a new job requires seeking a lot of information and feedback early on, which they seem to be more comfortable with.[35] Interestingly, extraverts are also found to be happier at work, which may be because of the relationships they build with the people around them and their easier adjustment to a new job.[36] However, they do not necessarily perform well in all jobs; jobs depriving them of social interaction may be a poor fit. Moreover, they are not necessarily model employees. For example, they tend to have higher levels of absenteeism at work, potentially because they may miss work to hang out with or attend to the needs of their friends.[37] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work Agreeableness is the degree to which a person is affable, tolerant, sensitive, trusting, kind, and warm. In other words, people who are high in agreeableness are likable and get along with others. Not surprisingly, agreeable people help others at work consistently; this personality trait is consistently related to prosocial behaviors, or showing generosity, cooperation, and support for others.[38] They are also better able to cope with stressors such as family interference with work.[39] This may reflect their ability to show empathy and to give people the benefit of the doubt. Agreeable people may be a valuable addition to their teams and may be effective leaders because they create a positive environment when they are in leadership positions. In fact, they are regarded as highly ethical leaders by their subordinates.[40] At the other end of the spectrum, people low in agreeableness are less likely to show these positive behaviors. Moreover, people who are disagreeable are shown to quit their jobs unexpectedly, perhaps in response to a conflict with a boss or a peer.[41] Despite its advantages, agreeableness also has some downsides. Research shows that agreeable individuals tend to have lower levels of financial credit ratings, which may be a result of making promises they are not able to keep, or even co-signing loans for friends and family and then getting into financial trouble because of it.[42] Because they avoid conflict, they may miss opportunities for initiating constructive change or may get into difficulties while attempting to please others. Finally, recent research answered the age-old question: Do nice guys finish last? It seems that for men, agreeableness negatively relates to income level, whereas no relationship exists for women.[43] 87 Studies show a positive relationship between being extraverted and effectiveness as a salesperson. Shutterstock.com agreeableness What are your Big Five traits? Go to http://www.outofservice.com/bigfive/ to see how you score on these factors. Neuroticism refers to the degree to which a person is anxious, irritable, temperamental, and moody. It is the only Big Five dimension in which scoring high is undesirable. People very high in neuroticism experience a number of problems at work. Neuroticism has a high degree of overlap with perfectionistic tendencies, such as being overly concerned about making mistakes and doubting one’s actions.[44] Most neurotics’ problems are due to difficulties in handling stress. Neurotic employees experience lower levels of satisfaction with their lives, indicating their habitual levels of unhappiness.[45] Research has shown that they are more prone to experience stressors such as work-life conflict, more negatively affected by stressors such as autocratic leadership, and have less healthy ways of coping with their daily stress, such as in the form of increasing their daily intake of alcohol.[46] Out of the big five traits, this one is the strongest (and most negative) correlate of job satisfaction.[47] This personality trait has mixed effects on job search behavior: On the one hand, they experience greater burnout on the job and greater financial inadequacy, motivating them to look for an alternative. On the other hand, neurotic employees feel less confident about their ability to find a new job, discouraging them from seeking a new job.[48] The degree to which a person is nice, tolerant, sensitive, trusting, kind, and warm. One of the world’s most famous (and most neurotic) artists, Vincent Van Gogh did not see success during his lifetime. Shutterstock.com neuroticism The degree to which a person is anxious, irritable, temperamental, and moody. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 88 Organizational Behavior Positive and Negative Affectivity positive affective people People who experience positive moods more frequently, who tend to be happier at work. negative affective people People who experience negative moods with greater frequency, focus on the “glass half empty,” and experience more anxiety and nervousness. You may have noticed that behavior is also a function of moods. When people are in a good mood, they may be more cooperative, smile more, and act friendly. When these same people are in a bad mood, they may have a tendency to be picky, irritable, and less tolerant of different opinions. Yet some people seem to be in a good mood most of the time, and others seem to be in a bad mood most of the time regardless of what is actually going on in their lives. This distinction is manifested by positive and negative affectivity traits. Positive affective people experience positive moods more frequently, whereas negative affective people experience negative moods with greater frequency. Negative affective people focus on the “glass half empty” and experience more anxiety and nervousness.[49] Positive affective people tend to be happier at work,[50] and their happiness spreads to the rest of the work environment. As may be expected, this personality trait sets the tone in the work atmosphere. When a team comprises mostly negative affective people, there tends to be fewer instances of helping and cooperation. Teams dominated by positive affective people experience lower levels of absenteeism.[51] When people with a lot of power are also high in positive affectivity, the work environment is affected in a positive manner and can lead to greater levels of cooperation and finding mutually agreeable solutions to problems.[52] OB Toolbox: Help, I Work with a Negative Person! Shutterstock.com Employees who have high levels of neuroticism or high levels of negative affectivity may act overly negative at work, criticize others, complain about trivial things, or create an overall negative work environment. Here are some tips for how to work with them effectively.[53] • Understand that you are unlikely to change someone else’s personality. Personality is relatively stable and criticizing someone’s personality will not bring about change. If the behavior is truly disruptive, focus on the behavior, not personality. • Keep your emotional distance. It is very easy for their emotions to affect yours. As much as you can, maintain emotional distance from their negativity. • Keep an open mind. Just because a person is constantly negative does not mean that they are not sometimes right. Listen to the feedback they are giving you. • Set a time limit. If you are dealing with someone who constantly complains about things, you may want to limit these conversations to prevent them from consuming your time at work. • You may also empower them to act on the negatives they mention. The next time an overly negative individual complains about something, ask that person to think of ways to change the situation and get back to you. • Ask for specifics. If someone has a negative tone in general, you may want to ask for specific examples and evidence for the problems they have identified. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work 89 Self-Monitoring Self-monitoring refers to the extent to which a person is capable of altering his or her actions and appearance in social situations. In other words, people who are self-monitors are social chameleons who understand what the situation demands and act accordingly, while low self-monitors tend to act the way they feel.[54] High self-monitors are sensitive to the types of behaviors the social environment expects from them. Their greater ability to modify their behavior according to the demands of the situation and to manage their impressions effectively is a great advantage for them.[55] In general, they tend to be more successful in their careers. They are more likely to get cross-company promotions, and even when they stay with one company, they are more likely to advance.[56] Self-monitors also become the “go to” person in their company and they enjoy central positions in social networks.[57] They are rated as higher performers, and emerge as leaders.[58] While they are effective in influencing other people and get things done by managing their impressions, this personality trait has some challenges that need to be addressed. First, when evaluating the performance of other employees, they tend to be less accurate. It seems that while trying to manage their impressions, they may avoid giving accurate feedback to their subordinates to avoid confrontations.[59] This tendency may create problems for them if they are managers. Second, high self-monitors tend to experience higher levels of stress, probably caused by behaving in ways that conflict with their true feelings. In situations that demand positive emotions, they may act happy although they are not feeling happy, which puts an emotional burden on them. Finally, high selfmonitors tend to be less committed to their companies. They may see their jobs as a stepping-stone for greater things, which may prevent them from forming strong attachments and loyalty to their current employer.[60] self-monitoring The extent to which people are capable of monitoring their actions and appearance in social situations. Proactive Personality Proactive personality refers to a person’s inclination to fix what is perceived as wrong, change the status quo, and use initiative to solve problems. Instead of waiting to be told what to do, proactive people take action to initiate meaningful change and remove the obstacles they face along the way. In general, having a proactive personality has a number of advantages for these people. For example, they tend to be more successful in their job searches.[61] Proactive employees are also more successful over the course of their careers, because they use initiative and acquire greater understanding of the politics within the organization.[62] Proactive people are valuable assets to their companies because they may have higher levels of performance.[63] They adjust to their new jobs quickly because they understand the political environment better and often make friends more quickly and are more responsive to the feedback they receive.[64] Proactive people are eager to learn and engage in many developmental activities to improve their skills.[65] Despite all their potential, under some circumstances a proactive personality may be a liability for an individual or an organization. Individuals who are proactive but who are perceived as being too pushy try to change things other people are not willing to let go of, or use their initiative to make decisions that do not serve a company’s best interests. Research shows that the success of proactive people depends on their understanding of a company’s core values, their ability and skills to perform their jobs, and their ability to assess situational demands correctly.[66] proactive personality A person’s inclination to fix what is perceived to be wrong, change the status quo, and use initiative to solve problems. Self-Esteem Self-esteem is the degree to which a person has overall positive feelings about oneself. People with high self-esteem view themselves in a positive light, are confident, and respect themselves. On the other hand, people with low self-esteem experience high levels of self-doubt and question their self-worth. High self-esteem is related to higher levels of satisfaction with one’s job and higher levels of performance on the job as well as higher levels of creativity at work.[67] People with low self- © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. self-esteem The degree to which a person has overall positive feelings about oneself. 90 Organizational Behavior esteem are attracted to situations in which they will be relatively invisible, such as large companies.[68] Managing employees with low self-esteem may be challenging at times, because negative feedback given with the intention to improve performance may be viewed as a judgment on their worth as an employee. Individuals with low self- esteem are sensitive to social feedback, and they interpret ambiguous situations as definitive signals of social exclusion, which in turn leads to negative self-evaluations.[69] Therefore, effectively managing employees with relatively low self-esteem requires tact and providing lots of positive feedback when discussing performance incidents. Self-Efficacy self-efficacy A belief that one can perform a specific task successfully. Self-efficacy is a belief that one can perform a specific task successfully. Research shows that the belief that we can do something is a good predictor of whether we can actually do it. Self-efficacy is different from other personality traits in that it is job specific. You may have high self-efficacy in being successful academically, but low self-efficacy in relation to your ability to fix your car. At the same time, people have a certain level of generalized self-efficacy, and they have the belief that whatever task or hobby they tackle, they are likely to be successful in it. Research shows that self-efficacy at work is related to job performance.[70] This relationship is probably a result of people with high self-efficacy setting higher goals for themselves and being more committed to these goals, whereas people with low self-efficacy tend to procrastinate.[71] Managerial self-efficacy is a good predictor of whether the manager seeks input from employees as managers with low self-efficacy will be more defensive of themselves, and less likely to want to hear about how they can manage more effectively.[72] Is there a way of increasing employees’ self-efficacy? Hiring people who are capable of performing their tasks and training people to increase their self-efficacy may be effective. Some people may also respond well to verbal encouragement. By showing that you believe they can be successful and effectively playing the role of a cheerleader, you may be able to increase self-efficacy. Giving people opportunities to test their skills so that they can see what they are capable of doing (or empowering them) is also a good way of increasing self-efficacy.[73] OB Toolbox: Ways to Build Your Self-Confidence Shutterstock.com Having high self-efficacy and self-esteem are boons to your career. People who have an overall positive view of themselves and those who have positive attitudes toward their abilities project an aura of confidence. How do you achieve higher self-confidence?[74] • Take a self-inventory. What are the areas in which you lack confidence? Then consciously tackle these areas. Take part in training programs; seek opportunities to practice these skills. Confront your fears head-on. • Set manageable goals. Success in challenging goals will breed self-confidence, but do not make your goals impossible to reach. If a task seems daunting, break it apart and set mini goals. • Find a mentor. A mentor can point out areas in need of improvement, provide accurate feedback, and point to ways of improving yourself. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work • Don’t judge yourself by your failures. Everyone fails, and the most successful people have more failures in life. Instead of assessing your self-worth by your failures, learn from mistakes and move on. • Until you can feel confident, be sure to act confident. Acting confident will influence how others treat you, which will boost your confidence level. Pay attention to how you talk and behave, and act like someone who has high confidence. • Know when to ignore negative advice. If you receive negative feedback from someone who is usually negative, try to ignore it. Surrounding yourself with naysayers is not good for your self-esteem. This does not mean that you should ignore all negative feedback, but be sure to look at a person’s overall attitude before making serious judgments based on that feedback. FIGURE 3.1 Core Self-Evaluations Researchers view neuroticism, locus of control, self-efficacy, and self-esteem as part of a person’s self-evaluations. Positive feelings about oneself are beneficial for effectiveness and happiness at work. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 91 92 Organizational Behavior Locus of Control internal locus of control A person's belief that they control their own destiny and what happens to them is their own doing. external locus of control A person's belief that things happen because of other people, luck, or a powerful being. Locus of control deals with the degree to which people feel accountable for their own behaviors. Individuals with high internal locus of control believe that they control their own destiny and what happens to them is their own doing, while those with high external locus of control feel that things happen to them because of other people, luck, or a powerful being. Internals feel greater control over their own lives, and therefore they act in ways that will increase their chances of success. For example, they are more involved with their jobs. They demonstrate higher levels of motivation and have more positive experiences at work. When they are faced with problems, they adopt problem-focused coping strategies.[75] Interestingly, internal locus is also related to one’s subjective well-being and happiness in life, while being high in external locus is related to a higher rate of depression.[76] The connection between internal locus of control and health is interesting, but perhaps not surprising. In fact, one study showed that having internal locus of control at the age of 10 was related to a number of health outcomes, such as lower obesity and lower blood pressure later in life.[77] It is possible that internals take more responsibility for their health and adopt healthier habits, while externals may see less of a connection between how they live and their health. Internals thrive in contexts in which they have the ability to influence their own behavior. Successful entrepreneurs tend to have high levels of internal locus of control.[78] Personality Testing in Employee Selection Goldman Sachs started using a personality test focusing on the Big Five traits in 2018. 360b/Shutterstock.com faking The practice of answering questions in a way one thinks the company is looking for. Personality is a potentially important predictor of work behavior. Matching people to jobs matters, because when people do not fit with their jobs or the company, they are more likely to leave, costing companies as much as a person’s annual salary to replace them. In job interviews, companies try to assess a candidate’s personality and the potential for a good match, but interviews are only as good as the people conducting them. Unfortunately, research has shown that most interviewers are not particularly good at detecting the one trait that best predicts performance: conscientiousness.[79] One method some companies use to improve this match and detect the people who are potentially good job candidates is personality testing. Several companies conduct pre-employment personality tests. Companies using them believe that these tests improve the effectiveness of their selection and reduce turnover. For example, Overnight Transportation in Atlanta found that using such tests reduced their on-the-job delinquency by 50%–100%.[80] Experts have not yet reached an agreement regarding the best way to select employees, and the topic is highly controversial. Some experts cite data that personality tests predict performance and other important criteria such as job satisfaction. A key consideration in this debate is the knowledge that how a personality test is used influences its validity. Imagine filling out a personality test in class. You may be more likely to fill it out as honestly as you can. Then, if your instructor correlates your personality scores with your class performance, we could say that the correlation is meaningful. In employee selection, one complicating factor is that people filling out the survey in a hiring context do not have a strong incentive to be honest. In fact, they have a greater incentive to guess what the job requires and answer the questions to match what they think the company is looking for. As a result, the rankings of the candidates who take the test may be affected by their ability to fake desired qualities. Some experts believe that this is a serious problem. In fact, it is estimated that 20%–50% of all job applicants give fake responses in personality tests.[81] Others point out that even with faking, the tests remain valid because the scores are still related to job performance.[82] It is even possible that the ability to fake is related to a personality trait that increases success at work, such as self-monitoring. This issue raises potential questions regarding whether personality tests are the most effective way of measuring candidate personality. Scores are also distorted because of some candidates faking better than others. For example, using a survey assumes that individuals understand their own personalities, but this may not be © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work the case. How supervisors, coworkers, and customers see our personality matters more than how we see ourselves. Therefore, using self-report measures of performance may not be the best way of measuring someone’s personality, whereas asking our former colleagues or supervisors may reveal more accurate answers. In fact, observers are often surprisingly accurate in assessing our personality. In one study, evaluators were able to accurately assess the personality of others simply by looking at and rating their Facebook pages.[83] In addition, individuals may be tempted to give “aspirational” answers to surveys. If you are asked if you are honest, you may think, “Yes, I always have the intention to be honest.” While this answer is related to how you value honesty, it may say nothing about your actual level of honest behavior in any given situation. Another problem with personality tests is the uncertain relationship between performance and personality. Research has shown that personality is not a particularly strong predictor of how a person will perform at work. According to one estimate, personality only explains about 10%–15% of variation in job performance. Our performance at work depends on many factors, and personality does not seem to be the key factor for performance. In fact, cognitive ability (your overall mental intelligence) is a much more powerful influence on job performance, and instead of personality tests, cognitive ability tests may do a better job of predicting who will be good performers. Personality is a better predictor of job satisfaction and other attitudes, but screening people out based on the assumption that they may be unhappy at work is a challenging argument to make in the context of employee selection. In any case, if you decide to use personality tests for selection, you need to be aware of their limitations. Relying only on personality tests for selection of an employee is a bad idea, but if they are used together with other tests such as tests of cognitive abilities, better decisions may be made. The company should ensure that the test fits the job and actually predicts performance. This process is called validating the test. Before giving the test to applicants, the company could give it to existing employees to find out the traits that are most important for success in the particular company and job. Then, in the selection context, the company can pay particular attention to those traits. The company should also make sure that the test does not discriminate against people on the basis of sex, race, age, disabilities, and other legally protected characteristics. Rent-A-Center experienced legal difficulties when the test they used was found to be a violation of the Americans with Disabilities Act (ADA). The test they used for selection, the Minnesota Multiphasic Personality Inventory, was developed to diagnose severe mental illnesses and included items such as “I see things or people around me others do not see.” In effect, the test served the purpose of a clinical evaluation and was discriminating against people with mental illnesses, which is a protected category under ADA.[84] Key Takeaway Values and personality traits are two dimensions on which people differ. Values are stable life goals. When seeking jobs, employees are more likely to accept a job that provides opportunities for value attainment, and they are more likely to remain in situations that satisfy their values. Personality comprises the stable feelings, thoughts, and behavioral patterns people have. The Big Five personality traits (openness, conscientiousness, extraversion, agreeableness, and neuroticism) are important traits that seem to be stable and can be generalized to other cultures. Other important traits for work behavior include self-efficacy, self-esteem, self-monitoring, proactive personality, positive and negative affectivity, and locus of control. It is important to remember that a person’s behavior depends on the match between the person and the situation. While personality is a strong influence on job attitudes, its relation to job performance is weaker. Some companies use personality testing to screen out candidates. This method has certain limitations, and companies using personality tests are advised to validate their tests and use them as a supplement to other techniques that have greater validity. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 93 94 Organizational Behavior What do you think? 1. Think about the personality traits covered in this section. Can you think of jobs or occupations that seem particularly suited to each trait? Which traits would be universally desirable across all jobs? 2. What are the unique challenges of managing employees who have low self-efficacy and low self-esteem? How would you deal with this situation? 3. What are some methods that companies can use to assess employee personality? 4. Have you ever held a job where your personality did not match the demands of the job? How did you react to this situation? How were your attitudes and behaviors affected? 5. Can you think of any limitations of developing an “ideal employee” profile and looking for employees who fit that profile while hiring? 3.4 Perception Learning Objectives 1. Understand the influence of self in the process of perception. 2. Describe how we perceive visual objects and how these tendencies may affect our behavior. 3. Describe the biases of self-perception. 4. Describe the biases inherent in perception of other people. 5. Explain what attributions mean, how we form attributions, and their consequences for organizational behavior. perception The process with which individuals detect and interpret environmental stimuli. Our behavior is not only a function of our personality, values, and preferences, but also of the situation. We interpret our environment, formulate responses, and act accordingly. Perception may be defined as the process with which individuals detect and interpret environmental stimuli. What makes human perception so interesting is that we do not solely respond to the stimuli in our environment. We go beyond the information that is present in our environment, pay selective attention to some aspects of the environment, and ignore other elements that may be immediately apparent to other people. Our perception of the environment is not entirely rational. For example, have you ever noticed that while glancing at a news website, information that is interesting or important to you seems to jump out of the page and catches your eye? If you are a sports fan, while scrolling down the pages you may immediately see a news item describing the latest success of your team. If you were recently turned down for a loan, an item of financial news may jump out at you. Therefore, what we see in the environment is a function of what we value, our needs, our fears, and our emotions.[85] In fact, what we see in the environment may be objectively, flat-out wrong because of our personality, values, or emotions. For example, one experiment showed that when people who were afraid of spiders were shown spiders, they inaccurately thought that the spider was moving toward them.[86] In this section, we will describe some common tendencies we engage in when perceiving objects or other people, and the consequences of such perceptions. Our coverage of biases and tendencies in perception is not exhaustive—there are many other biases and tendencies on our social perception. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work 95 Visual Perception Our visual perception definitely goes beyond the physical information available to us. First of all, we extrapolate from the information available to us. Take a look at the figure with three circles. The white triangle you see in the middle is not really there, but we extrapolate from the information available and see it there.[87] FIGURE 3.2 Object Perception What do you see? Our visual perception is often biased because we do not perceive objects in isolation. The contrast between our focus of attention and the remainder of the environment may make an object appear bigger or smaller. This principle is illustrated in the figure with circles. Which of the middle circles is bigger? To most people, the one on the left appears bigger, but this is because it is surrounded by smaller circles. The contrast between the focal object and the objects surrounding it may make an object bigger or smaller to our eye. How do these tendencies influence behavior in organizations? You may have realized that the fact that our visual perception is faulty may make witness testimony faulty and biased. How do we know whether the employee you judge to be hardworking, fast, and neat is really like that? Is it really true, or are we comparing this person to other people in the immediate environment? Or let’s say that you do not like one of your peers and you think that this person is constantly surfing the Web during work hours. Are you sure? Have you really seen this person surf unrelated websites, or is it possible that the person was surfing the Web for work-related purposes? Our biased visual perception may lead to inaccurate inferences about the people around us. FIGURE 3.3 Sample Visual Illusion Which of the circles in the middle is bigger? At first glance, the one on the left may appear bigger, but they are in fact the same size. We compare the middle circle on the left to its surrounding circles, whereas the middle circle on the right is compared to the bigger circles surrounding it. Self-Perception Human beings are prone to errors and biases when perceiving themselves. The types of bias people have depends on their personality. Many people suffer from self-enhancement bias, in which individuals hold the tendency to overestimate their performance and capabilities and see themselves in a more positive light than others see them. At the same time, other people have the opposing extreme, which may be labeled as self-effacement bias (or modesty bias). This is the tendency to underestimate performance and capabilities and see events in a way that puts us in a more negative light. Individuals with low selfesteem are more prone to making this error. These tendencies have real consequences for behavior in organizations. For example, people who suffer from extreme levels of self-enhancement tendencies may not understand why they are not getting promoted or rewarded, while those who have a tendency to self-efface may project low confidence and take more blame for their failures than necessary. When human beings perceive themselves, they are also subject to the false consensus error. Simply put, such individuals overestimate how similar they are to other people.[88] Another example of this error is when individuals assume that whatever quirks they have are shared by a larger number of people than in reality. People who take home office supplies, tell white lies to their boss or colleagues, or take credit for other people’s work to get ahead may genuinely feel that these behaviors are more common than they are in reality. The problem for behavior in organizations is that, when people believe that a behavior is common and normal, they may repeat the behavior more freely. Under some circumstances, this may lead to a high level of unethical or even illegal behaviors. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. self-enhancement bias The tendency to overestimate our performance and capabilities, and to see ourselves in a more positive light than others see us. self-effacement bias The tendency to underestimate our performance and capabilities, and to see events in a way that puts us in a more negative light. false consensus error How we as human beings overestimate how similar we are to other people. 96 Organizational Behavior Social Perception How we perceive other people in our environment is also shaped by our values, emotions, feelings, and personality. Moreover, how we perceive others will shape our behavior, which in turn will shape the behavior of the person we are interacting with. stereotypes Generalizations based on a perceived group characteristic. self-fulfilling prophecy This happens when an established stereotype causes one to behave in a certain way, which leads the other party to behave in a way that makes the stereotype come true. selective perception When we pay selective attention to parts of the environment while ignoring other parts. One of the factors biasing our perception is stereotypes. Stereotypes are generalizations based on perceived group characteristics. For example, believing that women are more cooperative than men, or men are more assertive than women, is a stereotype. Stereotypes may be positive, negative, or neutral. Human beings have a natural tendency to categorize the information around them to make sense of their environment. What makes stereotypes potentially discriminatory and a perceptual bias is the tendency to generalize from a group to a particular individual. If the belief that men are more assertive than women leads to choosing a man over an equally (or potentially more) qualified female candidate for a position, the decision will be biased, illegal, and unfair. Stereotypes often create a situation called a self-fulfilling prophecy. This cycle occurs when people automatically behave as if an established stereotype is accurate, which leads to reactive behavior from the other party that confirms the stereotype.[89] If you have a stereotype such as “International students are friendly,” you are more likely to be friendly toward an international student. Because you are treating the other person better, the response you get may also be better, confirming your original belief that international students are friendly. Of course, just the opposite is also true. Suppose you believe that “young employees are slackers.” You are less likely to give a young employee high levels of responsibility or interesting and challenging assignments. The result may be that the young employee reporting to you may become increasingly bored at work and start goofing off, confirming your suspicions that young people are slackers. Stereotypes persist because of a process called selective perception. Selective perception simply means that we pay selective attention to parts of the environment while ignoring other parts. When we observe our environment, we see what we want to see and ignore information that may seem out of place. Here is an interesting example of how selective perception leads our perception to be shaped by the context: As part of a social experiment, the Washington Post newspaper arranged for Joshua Bell, the internationally acclaimed violin virtuoso, to perform in a corner of the Metro station in Washington, D.C. The violin he was playing was worth $3.5 million, and tickets for Bell’s concerts usually cost around $100. During his 45-minute rush-hour performance, only one person recognized him, only a few realized that they were hearing extraordinary music, and he made only $32 in tips. When you see someone playing at the metro station, would you expect them to be extraordinary?[90] Our background, expectations, and beliefs will shape which events we notice and which events we ignore. For example, the functional background of executives affects the changes they perceive in their environment.[91] Executives with a background in sales and marketing see the changes in the demand for their product, while executives with a background in information technology may more readily perceive the changes in the technology the company is using. Selective perception may perpetuate stereotypes because we are less likely to notice events that go against our beliefs. A person who believes that men drive better than women may be more likely to notice women driving poorly than men driving equally poorly. As a result, a stereotype is maintained because information to the contrary may not reach our brain. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work Let’s say we noticed information that goes against our beliefs. What then? Unfortunately, this is no guarantee that we will modify our beliefs and prejudices. First, when we see examples that go against our stereotypes, we tend to come up with subcategories. For example, when people who believe that women are more cooperative see a woman who is assertive, they may classify this person as a “career woman.” Therefore, the example to the contrary does not violate the stereotype, and instead is explained away as an exception to the rule.[92] Second, we may simply discount the information. In one study, people who were either in favor of or opposed to the death penalty were shown two studies, one showing purported benefits from the death penalty and the other discounting any benefits. People rejected the study that went against their belief as methodologically inferior and actually reinforced the belief in their original position even more.[93] In other words, trying to debunk people’s beliefs or previously established opinions with data may not necessarily help. One other perceptual tendency that may affect work behavior is that of first impressions. The first impressions we form about people tend to have a lasting impact. People have a tendency to use irrelevant information such as baby-faceness, similarity to familiar faces, fitness, or youthfulness to arrive at impressions relating to the person’s competence, warmth, or power.[94] First impressions, once formed, are surprisingly resilient to contrary information. The reason is that, once we form first impressions, they become independent of the evidence that created them. It is possible to reverse first impressions by providing information that results in a complete reinterpretation of initial information, but this is not always easy and feasible.[95] Being aware of this tendency and consciously opening your mind to new information may protect you against some of the downsides of this bias. Also, it would be to your advantage to pay careful attention to the first impressions you create, particularly during job interviews. OB Toolbox: How Can I Make a Great First Impression in a Job Interview? Shutterstock.com A job interview is your first step to getting the job of your dreams. It is also a social interaction in which your actions during the first five minutes will determine the impression you make. Here are some tips to help you create a positive first impression.[96] • Your first opportunity to make a great impression starts even before the interview, the moment you send your résumé. Make sure that your résumé looks professional and is free from typos and grammar problems. Have someone else read it before you upload or send your résumé. • Dress the part. Take a shower. Keep make-up, perfume, and jewelry light. Clean and trim nails. Wear clean and pressed clothes, even if your interview is through a video call. These tips seem obvious, except that many interviewees skip on some of these steps, only to be remembered in stories of what not to do. What to wear is a harder question due to industry and geographic differences, but it should probably be more formal than what you would wear to work on a daily basis, and something you feel comfortable in. • Be prepared for the interview. Many interviews have some standard questions such as “Tell me about yourself” or “Why do you want to work here?” Be ready to answer these questions. Prepare answers highlighting your skills and accomplishments, and practice your message. Better yet, practice an interview with a friend. Practicing your answers will prevent you from regretting your answers or finding a better answer after the interview is over! © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 97 First impressions are lasting. A job interview is one situation in which first impressions formed during the first few minutes may have consequences for your relationship with your future boss or colleagues. Shutterstock.com first impressions Initial thoughts and perceptions we form about people, which tend to be stable and resilient to contrary information. 98 Organizational Behavior • Test the technology. If your interview will be via remote technology, be sure that you have a stable internet connection, test your microphone and camera, and reboot your computer a few hours before the call. Give yourself enough time to troubleshoot the technology if something goes wrong. • Research the company. If you know a lot about the company and the job in question, you will come across as someone who is really interested in the job. If you ask basic questions such as “What does this company do?” you will not be taken as a serious candidate. Visit the company’s website as well as others, and learn as much about the company and the job as you can. • Set up the workspace for a remote interview. Part of getting ready for a remote interview is to make sure that what is visible behind you is not a distraction to you or the interviewer. Be sure that the light is on your face (if the light is behind you, your face will not be visible). If you have other people in the house, be sure that they will not interrupt you during your interview. Space yourself from the camera so that you are not too far or too close. • Be on time to the interview. Being late will show that you either don’t care about the interview or you are not very reliable. While waiting for the interview, don’t forget that your interview has already started. As soon as you enter the company’s parking lot, every person you see or talk to on the way may be a potential influence over the decision maker. Act professionally and treat everyone nicely. • During the interview, be polite. Use correct grammar, avoid filler words such as “umm” or “like,” show eagerness and enthusiasm, and watch your body language. From your handshake to your posture, your body is communicating whether you are the right person for the job! Attributions Your colleague Peter failed to meet the deadline. What do you do? Do you help him finish up his work? Do you give him the benefit of the doubt and place the blame on the difficulty of the project? Or do you think that he is irresponsible? Our behavior is a function of our perceptions. More specifically, when we observe others behave in a certain way, we ask ourselves a fundamental question: Why? Why did he fail to meet the deadline? Why did Mary get the promotion? Why did Mark help you when you needed help? The answer we give is the key to understanding our subsequent behavior. If you believe that Mark helped you because he is a nice person, your action will be different from your response if you think that Mark helped you because your boss pressured him to. attribution The causal explanation we give for an observed behavior. internal attribution Explaining someone’s behavior using the internal characteristics of the actor. An attribution is the causal explanation we give for an observed behavior. If you believe that a behavior is due to the internal characteristics of an actor, you are making an internal attribution. For example, let’s say your classmate Erin complained a lot when completing a finance assignment. If you think that she complained because she is a negative person, you are making an internal attribution. An external attribution is explaining someone’s behavior by referring to the situation. If you believe that Erin complained because the finance homework was difficult, you are making an external attribution. When do we make internal or external attributions? Research shows that three factors are the key to understanding what kind of attributions we make. external attribution Consensus: Do other people behave the same way? Explaining someone’s behavior by referring to the situation. Distinctiveness: Does this person behave the same way across different situations? Consistency: Does this person behave this way on different occasions in the same situation? Let’s assume that in addition to Erin, other people in the same class also complained (high consensus). Erin does not usually complain in other classes (high distinctiveness). Erin usually does not complain in finance class (low consistency). In this situation, you are likely to make an external attribution, such as thinking that this finance homework is difficult. On the other hand, let’s © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work 99 assume that Erin is the only person complaining (low consensus). Erin complains in a variety of situations (low distinctiveness), and every time she is in finance, she complains (high consistency). In this situation, you are likely to make an internal attribution, such as thinking that Erin is a negative person.[97] Interestingly though, our attributions do not always depend on the consensus, distinctiveness, and consistency we observe in a given situation. In other words, when making attributions, we do not always look at the situation objectively. For example, our overall relationship is a factor. When a manager likes a subordinate, the attributions made would be more favorable (successes are attributed to internal causes, while failures are attributed to external causes).[98] Moreover, when interpreting our own behavior, we suffer from self-serving bias. This is the tendency to attribute our failures to the situation while attributing our successes to internal causes.[99] TABLE 3.2 Consensus, Distinctiveness, and Consistency Determine Types of Attributions Made Consensus Distinctiveness Consistency Type of Attribution High consensus High distinctiveness Low consistency External Everyone else behaves the same way. This person does not usually behave in this way in different situations. This person does not usually behave this way in this situation. Low consensus Low distinctiveness High consistency No one else behaves the same way. This person usually behaves this Every time this person is in this way in different situations. situation, he or she acts the same way. Internal How we react to other people’s behavior would depend on the type of attributions we make. When faced with poor performance, such as missing a deadline, we are more likely to punish the person, if an internal attribution is made (such as “the person being unreliable”). In the same situation, if we make an external attribution (such as “the timeline was unreasonable”), instead of punishing the person we might extend the deadline or assign more help to the person. If we feel that someone’s failure is due to external causes, we may feel empathy toward the person and even offer help.[100] On the other hand, if someone succeeds and we make an internal attribution (he worked hard), we are more likely to reward the person, whereas an external attribution (the project was easy) is less likely to yield rewards for the person in question. Therefore, understanding attributions is important to predicting subsequent behavior. Key Takeaway Perception is how we make sense of our environment in response to environmental stimuli. While perceiving our surroundings, we go beyond the objective information available to us, and our perception is affected by our values, needs, and emotions. There are many biases that affect human perception of objects, self, and others. When perceiving the physical environment, we fill in gaps and extrapolate from the available information. We also contrast physical objects to their surroundings and may perceive something as bigger, smaller, slower, or faster than it really is. In self-perception, we may commit the self-enhancement or self-effacement bias, depending on our personality. We also overestimate how much we are like other people. When perceiving others, stereotypes infect our behavior. Stereotypes may lead to self-fulfilling prophecies. Stereotypes are perpetuated because of our tendency to pay selective attention to aspects of the environment and ignore information inconsistent with our beliefs. When perceiving others, the attributions we make will determine how we respond to the situation. Understanding the perception process gives us clues to understand human behavior. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. self-serving bias The tendency to attribute our failures to the situation while attributing our successes to internal causes. 100 Organizational Behavior What do you think? 1. What are the implications of contrast error for interpersonal interactions? Does this error occur only when we observe physical objects? Or have you encountered this error when perceiving the behavior of others? 2. What are the problems of false consensus error? How can managers deal with this tendency? 3. Is there such a thing as a “good” stereotype? Is a “good” stereotype useful or still problematic? 4. How do we manage the fact that human beings develop stereotypes? How would you prevent stereotypes from creating unfairness in decision making? 5. Is it possible to manage the attributions other people make about our behavior? Let’s assume that you have completed a project successfully. How would you maximize the chances that your manager will make an internal attribution? How would you increase the chances of an external attribution when you fail in a task? 3.5 Focus on Individual Differences, Ethics, Technology, and National Culture Learning Objectives 1. Consider the role of individual differences for ethical behavior. 2. Consider the relationship between individual differences and technology 3. Consider the role of national culture on individual differences. Individual Differences and Ethics Our values and personality influence how ethically we behave. Situational factors, rewards, and punishments following unethical choices as well as a company’s culture are extremely important, but the role of personality and personal values should not be ignored. Research reveals that individuals high in conscientiousness and agreeableness demonstrate lower levels of academic dishonesty (i.e., cheating).[101] Employees with external locus of control were found to make more unethical choices.[102] Shutterstock.com Our perceptual processes are clear influences on whether or not we behave ethically and how we respond to other people’s unethical behaviors. It seems that self-enhancement bias operates for our ethical decisions as well: We tend to overestimate how ethical we are in general. Our self-ratings of ethics tend to be higher than how other people rate us. This belief can create a glaring problem: If we think that we are more ethical than we are, we will have little motivation to improve. Therefore, understanding how other people perceive our actions is important to getting a better understanding of ourselves. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work 101 How we respond to unethical behavior of others will, to a large extent, depend on the attributions we make. If we attribute responsibility to the person in question, we are more likely to punish that person. In a study on sexual harassment that occurred after a workplace romance turned sour, results showed that if we attribute responsibility to the victim, we are less likely to punish the harasser.[103] Therefore, how we make attributions in a given situation will determine how we respond to others’ actions, including their unethical behaviors. Individual Differences and Technology An interesting development in technology is the ability to assess someone’s personality using machine learning, or using algorithms that improve over time. For example, the digital footprints individuals leave behind such as their social media posts in Facebook or Twitter, their status updates, group memberships, and any other activity can be analyzed to determine their personality. Machine learning algorithms are in fact able to make more accurate predictions of an employee’s personality relative to that person’s Facebook friends, and the predictions of machine learning algorithms can make better judgments about their behaviors, including substance use, political affiliation, and overall health. Similarly, information contained in smart phones such as communication and social media patterns, daytime and nighttime usage, music consumption, how mobile the person is, and overall phone activity can reliably predict a person’s conscientiousness, openness, and extraversion levels. While technology is enabling personality measurement, these developments have important implications for privacy and fairness if such technology is adopted in employee selection and assessment. [104] Shutterstock.com Companies are increasingly interested in measuring personality along with skills when hiring employees. In many instances, they turn to artificial intelligence (AI) to identify personality traits that are most predictive of job performance, and automate processing of candidates so that large numbers of candidates may be examined within a short time. For example, Kraft Heinz asks job applicants to play an online game involving inflating balloons and collecting money if the balloon does not burst, to measure applicants’ tendency to take risks. Other games measure other aspects of applicant personality. The results are compared to the profile of 250 top-performing employees and those who most closely resemble the profile of these high performing employees move on to the next stage. Companies using these technologies need to ensure that the criteria AI is focusing on are job related and are fair, and does not harm the level of diversity in the organization. For example, these methods restrict the new hires to those who most closely resemble the organization’s current top-performing employees, which may limit the amount of diversity in the organization and they may not necessarily be employees who will be top performers in the future. [105] Individual Differences Around the Globe Values that people care about vary around the world. In fact, when we refer to a country’s culture, we are referring to values that distinguish one nation from others. In other words, there is systematic variance in individuals’ personality and work values around the world, and this variance explains people’s behavior, attitudes, preferences, and the transferability of management practices to other cultures. When we refer to a country’s values, this does not mean that everyone in a given country shares the same values. People differ within and across nations. There will always be people who care more about money and others who care more about relationships within each culture. Yet there are also national differences in the percentage of people holding each value. A researcher from the Netherlands, Geert Hofstede, conducted a landmark study covering more than 60 coun© 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Shutterstock.com 102 Organizational Behavior tries and found that countries differ in four dimensions: the extent to which they put individuals or groups first (individualism), whether the society subscribes to equality or hierarchy among people (power distance), the degree to which the society fears change (uncertainty avoidance), and the extent to which the culture emphasizes acquiring money and being successful (masculinity).[106] Knowing about the values held in a society will tell us what type of a workplace would satisfy and motivate employees. Are personality traits universal? Researchers found that personality traits identified in Western cultures translate well to other cultures. For example, the five-factor model of personality is universal in that it explains how people differ from each other in over 79 countries. At the same time, there is variation among cultures in the dominant personality traits. In some countries, extraverts seem to be the majority, and in some countries the dominant trait is low emotional stability. For example, people from Europe and the United States are characterized by higher levels of extraversion compared to those from Asia and Africa. There are many factors explaining why some personality traits are dominant in some cultures. For example, the presence of democratic values is related to extraversion. Because democracy usually protects freedom of speech, people may feel more comfortable socializing with strangers as well as with friends, partly explaining the larger number of extraverts in democratic nations. Research also shows that in regions of the world that historically suffered from infectious diseases, extraversion and openness to experience was less dominant. Infectious diseases led people to limit social contact with strangers, explaining higher levels of introversion. Plus, to cope with infectious diseases, people developed strict habits for hygiene and the amount of spice to use in food, and deviating from these standards was bad for survival. This explains the lower levels of openness to new experiences in regions that experienced infectious diseases.[107] Is basic human perception universal? It seems that there is variation around the globe in how we perceive other people as well as ourselves. One difference is the importance of the context. Studies show that when perceiving people or objects, Westerners pay more attention to the individual, while Asians pay more attention to the context. For example, in one study, when judging the emotion felt by the person, the Americans mainly looked at the face of the person in question, while the Japanese also considered the emotions of the people surrounding the focal person. In other words, the Japanese subjects of the experiment derived meaning from the context as well as by looking at the person.[108] There seems to be some variation in the perceptual biases we commit as well. For example, human beings have a tendency to self-enhance. We see ourselves in a more positive light than others do. Yet the traits in which we self-enhance are culturally dependent. In Western cultures, people may overestimate how independent and self-reliant they are. In Asian cultures, such traits are not necessarily desirable, so they may not embellish their degree of independence. Yet they may overestimate how cooperative and loyal to the group they are because these traits are more desirable in collectivistic cultures.[109] Given the variation in individual differences around the globe, being sensitive to these differences will increase our managerial effectiveness when managing a diverse group of people. Key Takeaway There is a connection between how ethically we behave and our individual values, personality, and perception. Possessing values emphasizing economic well-being predicts unethical behavior. Having an external locus of control is also related to unethical decision making. We are also likely to overestimate how ethical we are, which can be a barrier against behaving ethically. Personality assessment using technology is a new frontier in human resources management. Culture seems to be an influence over our values, personality traits, perceptions, attitudes, and work behaviors. Therefore, understanding individual differences requires paying careful attention to the cultural context. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work What do you think? 1. If ethical decision making depends partially on personality, what can organizations do to increase the frequency of ethical behaviors? 2. What are your thoughts on the use of artificial intelligence in employee selection? 3. Do you think personality tests used in Western cultures in employee selection can be used in other cultures? 3.6 Hiring for Match: The Case of Netflix Studio R3/Shutterstock.com Hiring is perhaps one of the most important activities that takes place in a company, and it is common to hear managers talk about hiring the “best” people. Who exactly are the best people, though? And how do you get them to join your organization? Netflix, the entertainment company specializing in media streaming, is a thought leader in recruitment and hiring, and is responsible for many talent management practices adopted by other firms in recent years, including unlimited vacation time and eliminating annual performance reviews. Who is Netflix looking for? Patty McCord, who served as the Chief Talent Officer for Netflix for 14 years until her departure suggests that they are looking for a good “match.” She cautions that when people say they hire for fit with company culture, they typically are thinking of someone they would enjoy sharing a beer with, which is not how match should be defined. Such an approach leads to restricting diversity as hiring managers and teams end up hiring people who are similar to them. Instead, they should be looking for someone who can solve their current and future business problems, and someone who shares the key values and goals of the company. In a Harvard Business Review article and a follow-up podcast, she shares the example of hiring a programmer who was working in an Arizona bank. The candidate was not a typical Silicon Valley hire, as he was a quiet guy who enjoyed woodworking in his free time, and was working in a traditional industry, but he had built an app enhancing Netflix. Ultimately, he fit the company well because he was passionate about Netflix and the customer experience, despite his different background and personality. He was hired, and eventually rose through the ranks to become a vice president. In terms of the skills they look for, Netflix considers future as well as current needs. Past experience and keyword matches may not be so helpful if the job itself is new. For example, when the company first became interested in hiring someone who could analyze big data, this was not a skill listed on many résumés. So they had to look for the right people in all sorts of industries that handled large amounts of data, such as insurance or credit card companies. They caution that © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 103 104 Organizational Behavior job descriptions may be outdated and written for the person who left the job, and the company needs to consider the skills they will need in the future, or the skills they need right now in order to solve the business problems they are experiencing. Netflix has a unique culture. Unlike many Silicon Valley technology companies, they do not have a lot of perks such as free lunch or on-site gaming. They do have pretty big benefits such as their policy of 12 to 16 weeks of paid parental leave over the year following a child’s birth or adoption to all its employees. They also pride themselves in treating people like adults, which means a high level of empowerment and trust. Realizing that this culture is not for everyone, they try to attract the right person in multiple ways. The description of their culture is available for everyone to read, which they hope will weed out people who may not feel comfortable in such an environment. They also make sure that their recruitment and hiring experience signals their most important values. They avoid misleading people as part of the process. They share their biggest attractions, which they see as the ability to work with top-notch people. They also are honest in giving job candidates feedback about their concerns. Nellie Peshkov, former vice president of global talent acquisition, saw this as a test: “Do they get defensive, or do they accept the feedback and seek to engage in a healthy and productive dialogue? That's a clue to see if they will be successful or not.” [110] Read about the Netflix culture here: https://jobs.netflix.com/culture Multimedia Extension—Netflix Culture: Freedom and Responsibility View in the online reader Case Discussion Questions 1. Patty McCord cautions that in many companies, culture fit is treated as finding someone you would like to spend time with. Do you agree with this observation? How do you think culture fit should be defined? 2. How can organizations successfully hire someone who fits with their organization? What are some methods they can use? 3. Based on the case, what are the values and skills of someone who could be successful at Netflix? 4. Netflix uses realistic job previews of their culture. Do you believe that all companies should do this? Why or why not? 5. Netflix cautions that hiring managers should not rely too much on the job descriptions. What are the downsides of ignoring job descriptions when hiring someone? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 3 Individual Differences and Perception at Work 3.7 Conclusion In conclusion, in this chapter we have reviewed major individual differences that affect employee attitudes and behaviors. Our values and personality explain our preferences and the situations we feel comfortable with. Personality may influence our behavior, but the importance of the context in which behavior occurs should not be neglected. Many organizations use personality tests in employee selection, but the use of such tests is controversial because of problems such as faking and low predictive value of personality for job performance. Perception is how we interpret our environment. It is a major influence over our behavior, but many systematic biases color our perception and lead to misunderstandings. 3.8 Exercises Ethical Dilemma You are interviewing a job applicant for a corporate sales position. The job involves frequent interactions with clients, an impeccable work ethic, and punctuality. There is a job candidate you thought was a good fit for the position, but now you have doubts. In a moment of weakness, you googled the applicant’s name and you came across his Facebook profile, several public posts, and past tweets. The online presence of this person suggests that he frequently parties—there are many photos where he seems to be drinking with friends, and other posts where he talks about his dislike of routine and deadlines. Now you are torn. Should you hire this person or not? Discussion Questions 1. What are the advantages and disadvantages of checking the online footprint of prospective employees? 2. What would you really do in a situation like this? Individual Exercise Changing Others’ Perceptions of You How do other people perceive you? Identify one element of how others perceive you that you are interested in changing. It could be a positive perception (maybe they think you are more helpful than you really are) or a negative perception (maybe they think you don’t take your studies seriously). • What are the reasons why they formed this perception? Think about the underlying reasons. • What have you done to contribute to the development of this perception? • Do you think there are perceptual errors that contribute to this perception? Are they stereotyping? Are they engaging in selective perception? • Are you sure that your perception is the accurate one? What information do you have that makes your perceptions more valid than theirs? • Create an action plan about how you can change this perception. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 105 106 Organizational Behavior Group Exercise Selecting a Cashier Using a Personality Test You have been tasked with designing a selection system to hire 30 cashiers for a supermarket chain. The individual will be responsible for providing excellent customer service by assisting them, answering questions, and resolving complaints. The new hire will also be responsible for contributing to the cleanliness and organization of the store, and building displays of merchandise. 1. Identify the personality traits you think might be relevant to being successful as a cashier. 2. Develop a personality test aimed at measuring these dimensions. Make sure that each dimension you want to measure is captured by at least five questions. 3. Exchange the test you have developed with a different team in class. Have them fill out the survey and make sure that you fill out theirs. What problems have you encountered? How would you feel if you were a candidate taking this test? 4. Do you think that prospective employees would fill out this questionnaire honestly? If not, how would you ensure that the results you get would be honest and truly reflect their personality? 5. How would you validate such a test? Describe the steps you would take. Endnotes 1. Case written by Rachel Mattenberger, Talya Bauer, and Berrin Erdogan to accompany T. N. Bauer & B. Erdogan (2021). Organizational Behavior: Bridging Science and Practice (4.0). Boston, MA: FlatWorld. Partially based on ideas and information contained in Binole, G. If I Knew Then… https://portland.crains.com/if-i-knew-then/david-kahl/fully?utm_content=portland&utm_campaign=socialflow&utm_source=twitter&utm_medium=social#tw; About Fully. https://www.fully.com/about-us; Fully Blog. https://www.fully.com/blog. 2. Cable, D. M., & DeRue, D. S. (2002). The convergent and discriminant validity of subjective fit perceptions. Journal of Applied Psychology, 87, 875–884; Caldwell, D. F., & O’Reilly, C. A. (1990). Measuring person–job fit with a profile comparison process. Journal of Applied Psychology, 75, 648–657; Chatman, J. A. (1991). Matching people and organizations: Selection and socialization in public accounting firms. Administrative Science Quarterly, 36, 459–484; Judge, T. 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Black Collegian, 38(1), 78–80; Mather, J., & Watson, M. (2008, May 23). Perfect candidate. The Times Educational Supplement, 4789, 24–26; Prossack, A. (2018, April 30). How to make a great first impression. Forbes; Reece, T. (2006, November–December). How to wow! Career World, 35, 16–18. 97. Kelley, H. H. (1967). Attribution theory in social psychology. Nebraska Symposium on Motivation, 15, 192–238; Kelley, H. H. (1973). The processes of causal attribution. American Psychologist, 28, 107–128. 98. Heneman, R. L., Greenberger, D. B., & Anonyou, C. (1989). Attributions and exchanges: The effects of interpersonal factors on the diagnosis of employee performance. Academy of Management Journal, 32, 466–476. 99. Malle, B. F. (2006). The actor-observer asymmetry in attribution: A (surprising) meta-analysis. Psychological Bulletin, 132, 895–919. 100. LePine, J. A., & Van Dyne, L. (2001). Peer responses to low performers: An attributional model of helping in the context of groups. 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Organizational Behavior: Bridging Science and Practice (4.0). Boston, MA: FlatWorld. Partially based on ideas and information contained in Anonymous (January 2, 2018). Hiring the best people. Retrieved from https://hbr.org/ideacast/2018/01/hiring-the-bestpeople; Anonymous (March 27, 2018). Former Netflix talent chief shares her secrets for hiring successfully. Retrieved from https://www.businesslive.co.za/bd/business-and-economy/2018-03-27-former-netflix-talent-chief-shares-her-secrets-for-hiring-successfully/; Eyring, A. (August 24, 2017). Why you need to only hire people who fit your culture (No matter how overqualified they are). Retrieved from https://www.inc.com/alisoneyring/why-linkedin-and-netflix-only-hire-people-who-fit-.html; McCord, P. (January-February 2018). How to hire. Harvard Business Review, pp. 90-97; Gillett, R. (2015). Netflix just stepped up its leave policy- again. Business Insider. Retrieved from https://www.businessinsider.com/netflixoffers-more-paid-leave-to-hourly-employees?op=1 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 109 110 Organizational Behavior © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. CHAPTER 4 Attitudes and Behaviors at Work Sutterstock.com Learning Objectives After reading this chapter, you should be able to do the following: 1. Identify the major work attitudes that affect work behaviors. 2. List the key set of behaviors that matter for organizational performance. 3. Understand the connection between attitudes and behaviors at work and ethics, technology, and cross-cultural management. Much of organizational behavior is about the attitudes and behaviors of people at work. Learning what the research says about these outcomes will help you gain insight into your own ideas and actions as well as those of others. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 112 Organizational Behavior 4.1 Delivering Happiness: The Case of Zoom Video Communications Tada Images/Shutterstock.com Employees working around the world increasingly connect to each other through video conferencing technology; this trend dramatically accelerated due to the COVID-19 pandemic and the resulting increase in the number of employees working from home. Remote meetings may be conducted over a variety of different platforms, including Teams (owned by Microsoft), Hangout Meet (by Google), or Webex (by Cisco). Among these platforms owned by the giants of technology industry, the San Jose, California based Zoom emerged as a rare company that was able to take on these mature platforms by building a loyal following among thousands of business customers. Anyone can use Zoom for free, but to access more options, organizations can purchase corporate subscriptions. And many do, with the company boasting approximately 265,400 corporate customers each with over 10 employees as of this writing. Today, Zoom is regarded as one of the most valuable cloud-based companies in the world, and it belongs to a rare group of companies that were actually profitable when they went public in March 2019. Interestingly, the company attributes its success to “delivering happiness.” In fact, the S-1 statement (a document filed with the Securities and Exchange commission when the company went public) uses the word “happiness” over 50 times. Compare this to the S-1 statement of Uber, where it was not mentioned at all. Zoom views happiness of customers and happiness of people as the core elements of their corporate culture and the key to their success and future operations. The search for happiness is a key part of the company’s origin story. The company founder and CEO Eric Yuan, who immigrated to the USA when he was 27 and found a job as a software developer at the video conferencing company WebEx, rose through the ranks and became the VP of engineering. He was making a salary in the “upper six figures.” But he was not happy. Since he left his high paying job to develop his own videoconferencing software in 2011, he has been asked many times about the risk he was taking. His answer is this: “The purpose of life is to pursue happiness, and I was not happy. Then, what’s the risk?” By all metrics, Zoom is delivering happiness to customers and employees. Zoom is highly popular among its customers, because the products are user friendly and the company is innovative and responsive to customer needs and concerns. In fact, Zoom has a Net Promoter Score (a common metric to measure customer loyalty to the firm) of 70, similar to that of Apple, which is 73. At the beginning of 2020, the company had over 2,500 employees, with plans to hire upwards of 500 more people while expanding to new locations. Zoom also had a turnover rate of 3% in 2019, which is exceptionally low in the software industry. The company provides generous benefits and perks that are typical of technology companies. More importantly, employees feel appreciated and empowered at work, and believe that they have a voice in the company. A “happiness crew” of around 100 volunteers from different units of the business make sure that they host digital meet ups to connect the company’s employees scattered across eight countries. The company was © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 4 Attitudes and Behaviors at Work ranked the #2 best company to work for by Glassdoor in 2019, and #1 in happiest employees by Comparably. According to CEO Yuan, the company does not focus on revenue goals. Instead, he believes that focusing on customer and employee happiness will lead to increased growth.[1] Multimedia Extension—Culture of Caring View in the online reader Case Discussion Questions 1. Review websites such as Glassdoor and Comparably to see what employees like and dislike about working at Zoom. Would you like to work in a company such as this? 2. Zoom uses “happiness” as part of their brand as an employer. What advantages and downsides do you see to this brand? 3. What is the connection between employee attitudes, customer satisfaction, and revenue growth as described in this case? How generalizable is this relationship to other industries and companies? 4. Zoom had an IPO in 2019, which made it a public company. How do you expect that this may affect their corporate culture over time? 5. The case mentions many factors that could affect employee happiness, such as happiness crews and generous perks. Which elements mentioned in the case do you believe are the most critical to employee happiness? 4.2 Work Attitudes Learning Objectives 1. Define “work attitudes.” 2. Describe the relationship between attitudes and behaviors. 3. Define and differentiate between job satisfaction, organizational commitment, and job engagement. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 113 114 Organizational Behavior 4. List the factors related to work attitudes. 5. Describe the consequences of work attitudes. 6. Identify the ways in which companies can track work attitudes in the workplace. attitude Our opinions, beliefs, and feelings about aspects of our environment. job satisfaction The feelings people have toward their jobs. organizational commitment The emotional attachment people have toward the company they work for. job engagement Investment of one's mental, emotional, and physical energies at work. Our behavior at work often depends on how we feel about being there. Therefore, making sense of how people behave depends on understanding their work attitudes. An attitude refers to our opinions, beliefs, and feelings about aspects of our environment. We have attitudes toward the food we eat, people we interact with, courses we take, and various other things. At work, two particular job attitudes have the greatest potential to influence how we behave. These are job satisfaction and organizational commitment. Job satisfaction refers to the feelings people have toward their job. If the number of studies conducted on job satisfaction is an indicator, job satisfaction is probably the most important job attitude. Institutions such as Gallup Inc. or the Society for Human Resource Management (SHRM) periodically conduct studies of job satisfaction to track how satisfied employees are at work. A recent SHRM study revealed that 89% of respondents were at least somewhat satisfied with their jobs.[2] Organizational commitment is the emotional attachment people have toward the company they work for. There is a high degree of overlap between job satisfaction and organizational commitment, because things that make us happy with our job often make us more committed to the company as well. Finally, job engagement is a more recently developed motivational concept that is similar to a work attitude. Job engagement refers to the investment of one’s mental, emotional, and physical energies into work. Engagement reflects employees’ enthusiasm, involvement, and satisfaction with their work, and it has implications for workplace behavior.[3] Given that job engagement has similar predictors and outcomes, and organizations track job engagement in a way similar to how the other two are tracked, we focus on these three concepts in our discussion of work attitudes. The connection between work attitudes and behaviors depends on the attitude in question. Your attitudes toward your colleagues may influence whether you actually help them on a project, but they may not be a good predictor of whether you will quit your job. Second, attitudes are more strongly related to intentions to behave in a certain way, rather than actual behaviors. When you are dissatisfied with your job, you may have the intention to leave. Whether you will actually leave is a different story. Your leaving will depend on many factors, such as availability of alternative jobs in the market, your employability in a different company, and sacrifices you have to make while changing jobs. In other words, while attitudes give us hints about how a person might behave, it is important to note that behavior is also strongly influenced by situational constraints. OB Toolbox: Boosting Your Happiness at Work Shutterstock.com • Have a positive attitude. Your personality is a big part of your happiness. If you are always looking for the negative side of everything, you will eventually find it. • Finding a good fit with the job and company is important to your happiness. This starts with knowing yourself: What do you want from the job? What do you enjoy doing? Be honest with yourself and do a self-assessment. • Get accurate information about the job and the company. Ask detailed questions about what life is like in this company. Do your research: Read about the company, and use your social network to understand the company’s culture. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 4 Attitudes and Behaviors at Work • Develop good relationships at work. Make friends. Try to get a mentor. Approach a person you admire and attempt to build a relationship with this person. An experienced mentor can be a great help in navigating life at a company. Your social network can help you weather the bad days and provide you emotional and instrumental support during your time at the company as well as afterwards. • Pay is important, but job characteristics matter more to your job satisfaction. Don’t sacrifice the job itself for a little bit more money. When choosing a job, look at the level of challenge, and the potential of the job to make you engaged. • Be proactive in managing organizational life. If the job is stressful, cope with it by effective time management and having a good social network, as well as being proactive in getting to the source of stress. If you don’t have enough direction, ask for it! • Know when to leave. If the job makes you unhappy over an extended period of time and there is little hope of solving the problems, it may be time to look elsewhere. What Causes Positive Work Attitudes? What makes you satisfied with your job, develop commitment to your company, and feel engaged at work? Research shows that people pay attention to several aspects of their work environment, including how they are treated, the relationships they form with colleagues and managers, and the actual work they perform. In addition, what people value at any given time may be a function of the economic circumstances and the job market. For example, during an economic recession, job security is likely to become a more salient influence over job attitudes. In this section, we summarize the factors that show consistent relations with job satisfaction and organizational commitment. FIGURE 4.1 Factors Contributing to Job Attitudes Personality Can assessing the work environment fully explain how satisfied we are on the job? Interestingly, some experts have shown that job satisfaction is not purely environmental and is partially due to our personality. Some people have a disposition to be happy in life and at work regardless of environmental factors. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 115 116 Organizational Behavior It seems that people who have a positive affective disposition (those who have a tendency to experience positive moods more often than negative moods) tend to be more satisfied with their jobs and more committed to their companies, while those who have a negative disposition tend to be less satisfied and less committed.[4] This is not surprising, as people who are determined to see the glass as “half full” will notice the good things in their work environment, while those with the opposite character will find more things to complain about. In addition to our affective disposition, people who have positive core self-evaluations (individuals who have high generalized self-efficacy, high self-esteem, internal locus of control, and low levels of neuroticism) tend to have more positive job attitudes.[5] Research also suggests that even though all five of the big five personality traits are correlated with organizational commitment, agreeableness has the strongest relationship.[6] Either these people are more successful in finding jobs and companies that will make them happy and build better relationships at work, which would increase their satisfaction and commitment, or they simply see their environment as more positive—whichever is the case, it seems that personality is related to work attitudes. Person–Environment Fit The fit between what we bring to our work environment and the environmental demands influences both our behavior as well as our work attitudes. Therefore, person–job fit and person–organization fit are positively related to job satisfaction and commitment. When the abilities of individuals match those of the job demands and company values, they tend to be more satisfied with the job and more committed to the company.[7] When companies hire employees, they are interested in assessing at least two types of fit. Person–organization fit refers to the degree to which a person’s personality, values, goals, and other characteristics match those of the organization. Person–job fit is the degree to which a person’s knowledge, skills, abilities, and other characteristics match the job demands. (Human resources professionals often use the abbreviation KSAO to refer to these four categories of attributes). Thus, someone who is proactive and creative may be a great fit for a company in the high-tech sector that would benefit from risk-taking individuals but may be a poor fit for a company that puts a high priority on routine and predictable behavior, such as a nuclear power plant. Similarly, a proactive and creative person may be a great fit for a field-based job such as marketing manager but a poor fit for an office job highly dependent on rules, such as an accountant. Some companies are in a great position to attract people who fit. For example, lifestyle retailers such as Patagonia, Columbia Sportswear, and Nike draw people who are attracted to the active, outdoorsy lifestyle these companies focus on. The core values of these businesses, such as preserving the environment, appeal to these job candidates who enjoy spending a lot of time in nature. To someone who enjoys surfing, being a product tester for surfing gear may be highly appealing. Thus, it is no surprise that when people fit into their organization, they tend to be more satisfied with their jobs, more committed to their companies, more influential in their company, and remain longer in their company.[8] Job Characteristics We discuss the relationship between job characteristics and employee job attitudes in more detail in Chapter 6. The presence of certain characteristics on the job seems to make employees more satisfied and more committed. Using a variety of complex skills, having empowerment at work, receiving feedback on the job, and performing a significant task are some job characteristics that are related to satisfaction and commitment. However, the presence of these factors is not important for everyone. Some people have a high growth need. They expect their jobs to help them build new skills and improve as an employee. These people tend to be more satisfied when their jobs have these characteristics.[9] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 4 Attitudes and Behaviors at Work 117 Psychological Contract After accepting a job, people come to work with a set of expectations. They have an understanding of their responsibilities and rights. In other words, they have a psychological contract with the company. A psychological contract is an unwritten understanding about what the employee will bring to the work environment and what the company will provide in exchange. When people do not get what they expect, they experience a psychological contract breach, which leads to low job satisfaction and commitment. Imagine that you were told before being hired that the company was family friendly and collegial. However, after a while, you realize that they expect employees to work 70 hours a week, and employees are aggressive toward each other. You are likely to experience a breach in your psychological contract and be dissatisfied. One way of preventing such problems is for companies to provide realistic job previews to their employees. Individuals may recover from psychological contract breaches in cases where the emotional impact of the breach is modest or when the organization shows support following the breach.[10] psychological contract An unwritten understanding about what the employee will bring to the work environment and what the company will provide in exchange. psychological contract breach Violation of the unwritten understanding between the employee and the organization regarding expectations. Organizational Justice A strong influence over our satisfaction level is how fairly we are treated. People pay attention to the fairness of company policies and procedures, treatment from supervisors, and pay and other rewards they receive from the company.[11] As a case in point, workplace incivility is a negative predictor of job attitudes. When individuals are targets of demeaning remarks or rude and discourteous actions, their job attitudes suffer.[12] While fair treatment matters for job attitudes, evidence suggests that job attitudes have little to do with how much money a person makes. Meta-analytic findings suggest that the correlation between pay level and job satisfaction is 0.15, which indicates a weak relationship.[13] Relationships at Work Relationships employees establish with coworkers, managers, and the organization are key influences over job attitudes. The people we interact with, their degree of compassion, our level of social acceptance in our work group, and whether we are treated with respect are all important factors surrounding our happiness at work. Research also shows that our relationship with our manager, how considerate the manager is, and whether we build a trust-based relationship with our manager are critically important to our job attitudes.[14] Other people serve a number of key functions for employees. Coworkers and managers may affect employee job attitudes by providing task assistance, career support, emotional support, friendship, helping with personal growth, and providing opportunities for individuals to assist and mentor others. Finally, perceived organizational support, or the degree to which employees feel that the organization cares about their well-being, values them, and fulfills their needs is an important influence over job attitudes.[15] Stress Not surprisingly, the amount of stress present in our job is related to our satisfaction and commitment. For example, experiencing role ambiguity (vagueness in relation to what our responsibilities are), role conflict (facing contradictory demands at work), and organizational politics, and worrying about the security of our job are all stressors that make people dissatisfied. Among new employees, stress caused by uncertainty (regarding relationships or one’s ability to perform well) is particularly relevant to job attitudes. On the other hand, not all stress is bad. Some stressors actually make us happier. For example, working under time pressure and having a high degree of responsibility are © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. perceived organizational support The degree to which employees feel that the organization cares about their well-being, values them, and fulfills their needs. 118 Organizational Behavior stressful, but they can also be perceived as challenges and tend to be related to high levels of satisfaction.[16] Work-Life Balance In the 1950s, work was all-consuming. Employees went to work, worked long hours, and the rest of the family accepted that work came first. As society changed, the concept of always putting work first became outdated. In modern times, more employees expect to lead balanced lives, pursue hobbies, and spend more time with their children while at the same time continuing to succeed at work. The notion of work-family conflict is one cause of job dissatisfaction. This conflict can be particularly strong for women because of the time necessary for pregnancy and giving birth, but men struggle with it as well. When work life interferes with family life, we are more stressed and unhappy with our jobs. Research shows that family-supportive workplace policies and supervisory family support are related to more positive job attitudes. For example, Cisco Systems offers paid parental leave, on-site childcare arrangements, and a flexible work environment, resulting in a family-supportive environment for employees.[17] Consequences of Positive Work Attitudes Why do we care about job attitudes? What behaviors would you expect to see from someone who has a more positive work attitude? If you say “higher performance,” you have stumbled on one of the relatively controversial subjects in organizational behavior. Many studies have been devoted to understanding whether happy employees are more productive. Some studies show weak correlations between satisfaction and performance while others show higher correlations (what researchers would call “medium-sized” correlations of 0.30).[18] The correlation between commitment and performance tends to be even weaker.[19] Even with a correlation of 0.30 though, the relationship may be lower than you may have expected. Why is this so? Work attitudes are often good predictors of work behavior, such as performance, citizenship behaviors, absenteeism, and turnover. Shutterstock.com It seems that happy workers have an inclination to be more engaged at work. They may want to perform better. They may be more motivated. But there are also exceptions. Think about this: Just because you want to perform, will you actually be a higher performer? Chances are that your skill level in performing the job will matter. There are also some jobs where performance depends on factors beyond an employee’s control, such as the pace of the machine they are working on. Because of this reason, in professional jobs such as engineering and research, we see a higher link between work attitudes and performance, as opposed to manual jobs such as assembly line work.[20] Also, consider the alternative possibility: If you don’t like your job, does this mean that you will reduce your performance? Maybe up to a certain point, but there will be factors that prevent you from reducing your performance: the fear of getting fired, the desire to get a promotion so that you can get out of the job that you dislike so much, or your professional work ethic. As a result, we should not expect a one-to-one relationship between satisfaction and performance. Still, the observed correlation between work attitudes and performance is important and has practical value. Work attitudes are even more strongly related to organizational citizenship behaviors (behaviors that are not part of our job but are valuable to the organization, such as helping new employees or working voluntary overtime). Satisfied and committed people are absent less frequently and for shorter duration, are likely to stay with a company longer, and demonstrate less aggression at work. Just as important, people who are happy at work are happier with their lives overall. Given that we spend so much of our waking hours at work, it is no surprise that our satisfaction with our job is a big part of how satisfied we feel about life in general.[21] Finally, a satisfied workforce seems to be © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 4 Attitudes and Behaviors at Work 119 related to positive firm-level outcomes, such as customer satisfaction and loyalty, profitability, and safety in the workplace.[22] Assessing Work Attitudes in the Workplace Given that work attitudes provide valuable clues as to who will leave or stay with an organization, why some individuals will perform better, and which employees will be more engaged, tracking satisfaction and commitment levels is a helpful step for companies. If there are company-wide issues that make employees unhappy and disengaged, then these issues need to be resolved. There are at least three systematic ways in which companies can track work attitudes: through attitude surveys, exit interviews, and sentiment analysis. Companies such as Facebook, PwC, Google, and others routinely give attitude surveys to employees to track their work attitudes over time. Surveys give employees a chance to voice their concerns, and they can be powerful tools to make changes in the organization.[23] Companies can get more out of these surveys if responses are held confidential. Moreover, the success of these surveys depends on the credibility of management in the eyes of employees. If management periodically collects these surveys but no action comes out of them, employees may adopt a more cynical attitude and start ignoring these surveys, hampering the success of future efforts. A recent variation of attitude surveys is pulse surveys, which are very short surveys given to employees frequently (such as every week or every month). These surveys allow businesses to track job attitudes over time and gain an assessment of changes in attitudes. IBM Watson artificial intelligence platform for business is an example of technological tools that can perform sentiment analysis to provide information about employee emotions and attitudes at work. drserg/Shutterstock.com An exit interview involves a meeting with the departing employee. This meeting is often conducted by a member of the human resource management department. The departing employee’s manager is the worst person to conduct the interview, because managers are often one of the primary reasons an employee is leaving in the first place. If conducted well, this meeting may reveal what makes employees dissatisfied at work and give management clues about areas for improvement. Experts recommend that having these interviews conducted by a second level manager (the manager’s manager) may have advantages as it may lead to changes. Making these interviews mandatory for at least some groups of employees (such as high potential employees), conducting the meeting halfway between departure announcement and actual departure, conducting the meeting face to face or over the phone, following a semi-structured approach, and being a good listener during the interview are just some of the recommendations for these interviews.[24] attitude surveys Finally, sentiment analysis is the automatic identification and coding of positive and negative sentiments in a text.[25] This technique is often used in marketing to analyze customer emotions toward a company’s product, but recently found its way to talent management. A company may analyze employees’ internal blog posts, open ended questions in attitude surveys, emails, or comments left on internal discussion boards to identify attitudes toward particular subjects. For example, during the COVID-19 pandemic, IBM organized online Ask Me Anything sessions with the company’s Chief Medical Officer. Employees were invited to ask questions and add written comments. These comments were later anonymized and fed into IBM’s sentiment analytics tool Watson Tone Analyzer to get a sense of employee attitudes and reactions.[26] sentiment analysis Key Takeaway Work attitudes are the feelings we have toward different aspects of the work environment. Job satisfaction and organizational commitment are two key attitudes that are the most relevant to important outcomes. Attitudes create an intention to behave in a certain way and may predict actual behavior under certain conditions. People develop positive work attitudes as a result of their personality, fit with their environment, stress levels they experience, relationships they develop, perceived fairness of their pay, company policies, interpersonal treatment, whether their psychological contract is violated, and the presence of policies addressing work-life con- © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Surveys that measure employee attitudes at work. pulse surveys Short surveys given to employees very frequently. exit interview A meeting with the departing employee. Automatic identification and coding of positive and negative sentiments in a text. 120 Organizational Behavior flict. When people have more positive work attitudes, they may have the inclination to perform better, display citizenship behaviors, and be absent less often and for shorter periods of time, and they are less likely to quit their jobs within a short period of time. When workplace attitudes are more positive, companies benefit in the form of higher safety and better customer service, as well as higher company performance. What do you think? 1. What is the difference between job satisfaction and organizational commitment? Which do you think would be more strongly related to performance? Which would be more strongly related to turnover? 2. Do you think making employees happier at work is a good way of motivating people? When would high satisfaction not be related to high performance? 3. In your opinion, what are the three most important factors that make people dissatisfied with their job? What are the three most important factors relating to organizational commitment? 4. How important is pay in making people attached to a company and making employees satisfied? 5. Do you think younger and older people are similar in what makes them happier at work and committed to their companies? Do you think there are male–female differences? Explain your answers. 4.3 Work Behaviors Learning Objectives 1. Define job performance, organizational citizenship, absenteeism, and turnover. 2. Explain factors associated with each type of work behavior. One of the important objectives of the field of organizational behavior is to understand why people behave the way they do. We will focus on five key work behaviors: job performance, organizational citizenship behaviors, counterproductive work behaviors, absenteeism, and turnover. While these five are not the only organizational behaviors we are interested in, if you understand these behaviors and the major influences over each type of behavior, you will gain valuable knowledge surrounding key behaviors in the workplace. We summarize the major research findings about the causes of each type of behavior in the following table. TABLE 4.1 Summary of Factors That Have the Strongest Influence Over Work Behaviors Job Performance Citizenship Counterproductive Work Behaviors Absenteeism Turnover General mental abilities How we are treated at work Personality Health problems Poor performance How we are treated at work Personality Negative job attitudes Work/life balance issues Positive work attitudes (–) Stress (–) Positive work attitudes How we are treated at work Positive work attitudes (–) Stress © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 4 Attitudes and Behaviors at Work Job Performance Citizenship Positive work attitudes Age of the employee Counterproductive Work Behaviors Personality 121 Absenteeism Turnover Age of the empoyee (–) Personality Age and tenure of the employee (–) Note: Negative relationships are indicated with (–) Job Performance Job performance, or in-role performance, refers to the degree to which an employee successfully fulfills the factors included in the job description. For each job, the content of job performance may differ. Measures of job performance include the quality and quantity of work performed by the employee, the accuracy and speed with which the job is performed, and the overall effectiveness of the person performing the job. In many companies, job performance determines whether a person is promoted, rewarded with pay raises, given additional responsibilities, or fired from the job. Therefore, job performance is tracked and observed in many organizations and is one of the main outcomes studied in the field of organizational behavior. job performance Also known as in-role performance, the degree to which an employee successfully fulfills the factors included in the job description. What Are the Major Predictors of Job Performance? Under which conditions do people perform well, and what are the characteristics of high performers? The most powerful influence over our job performance is our general mental ability, or cognitive abilities. Our reasoning abilities, verbal and numerical skills, analytical skills, and overall intelligence level seem to be important across most situations. It seems that general mental ability starts influencing us early in life; it is strongly correlated with measures of academic success.[27] As we grow and mature, cognitive ability is also correlated with different measures of job performance.[28] General mental ability is important for job performance across different settings, but there is also variation. In jobs with high complexity, it is much more critical to have high general mental abilities. In jobs such as working in sales, management, engineering, or other professional areas, this ability is much more important, whereas for jobs involving manual labor or clerical work, the importance of high mental abilities for high performance is weaker (yet still important). Perceptions of organizational justice and interpersonal relationships are factors determining performance level. When employees feel that they are being fairly treated by the company, that management is supportive and rewards high performance, and when individuals trust the people they work with, performance is better. The primary reason seems to be that when individuals believe they are treated well, they want to reciprocate. Therefore, individuals treat the company well by performing their jobs more effectively. The stress experienced on the job also determines performance level. When individuals are stressed, mental energies are drained. Instead of focusing on the task at hand, individuals become preoccupied with dealing with the stressor. Because attention and energies are diverted to dealing with stress, performance suffers. Having role ambiguity and experiencing conflicting role demands are related to lower performance.[29] Further, a recent survey found that financial stress affects 48% of workers in the U.S. When people are in debt or are worrying about their mortgage payments or college payments for their kids, their performance will suffer. The resulting loss of productivity in the workplace costs American businesses approximately $500 billion each year.[30] Work attitudes, particularly job satisfaction and job engagement, are also correlates of job performance.[31] Many studies have been devoted to understanding whether happy employees are more © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. general mental ability Also known as cognitive abilities, refers to our reasoning abilities, verbal and numerical skills, analytical skills, and overall intelligence level. 122 Organizational Behavior productive. Some studies show weak correlations between satisfaction and performance while others show higher correlations. Finally, job performance has a modest relationship with personality traits. Among the personality traits that are most strongly correlated with job performance are conscientiousness, emotional intelligence, and proactive personality. Research has shown that personality is a stronger predictor of job performance in “weak situations,” where there are not too many restrictions and employees have a great deal of freedom in structuring their work.[32] Further, studies indicate that when self-reported personality measures are used, the results tend to be weaker than when observer measures of personality are used. This is probably not surprising, given that self-reported personality measures may not reflect the reality as it is experienced by one’s coworkers and subordinates, which may be more relevant to how the employee is assessed by others at work.[33] Organizational Citizenship Behaviors organizational citizenship behaviors (OCB) Voluntary behaviors employees perform to help others and benefit the organization. While job performance refers to the performance of duties listed in one’s job description, organizational citizenship behaviors involve performing behaviors that are more discretionary. Organizational citizenship behaviors (OCB) are voluntary behaviors employees perform to help others and benefit the organization. Helping a new coworker understand how things work in your company and volunteering to organize company picnics are examples of citizenship behaviors. These behaviors contribute to the smooth operation of business. Interestingly, while citizenship behaviors help others, under some conditions such as when employees feel unsupported, demonstrating greater levels of citizenship may lead to citizenship fatigue, or feelings of being tired and worn out as a result of being a good citizen.[34] What are the major predictors of citizenship behaviors? Unlike job performance, citizenship behaviors do not depend on one’s general mental abilities. When you add the education, skills, knowledge, and abilities that are needed to perform well, the role of motivation on performance becomes more limited. As a result, just because someone is motivated will not mean that the person will perform well. For citizenship behaviors, in contrast, the motivation-behavior link is clearer. Organizational citizenship behaviors are voluntary actions, such as helping a coworker. While outside the scope of job duties, these behaviors contribute to the effective functioning of an organization. Perhaps the most important factor explaining citizenship behaviors is organizational justice and interpersonal relationships. When individuals have a good relationship with their manager and are supported, treated fairly, attached to peers, and trust the people at work, they are more likely to engage in citizenship behaviors. In a high-quality relationship, individuals feel the obligation to reciprocate and go the extra mile to help out coworkers. Further, the trajectory of how people are treated matters too. One study has shown that employees reciprocated fair treatment with higher citizenship behaviors when the current level of fairness they were experiencing was higher than what they experienced in the past, as opposed to when it was lower than what they experienced in the past.[35] Personality is yet another explanation for why individuals perform citizenship behaviors. Personality is a modest predictor of actual job performance but a much better predictor of citizenship. People who are conscientious and agreeable tend to perform citizenship behaviors more often than others.[36] Job attitudes are also moderately related to citizenship behaviors. People who are happier at work, those who are more committed to their companies, and those who have overall positive attitudes toward their work situation tend to perform citizenship behaviors more often than others. When people are unhappy, they tend to be disengaged from their jobs and rarely go beyond the minimum that is expected of them.[37] Shutterstock.com Interestingly, age seems to be related to the frequency with which we demonstrate citizenship behaviors. People who are older are better citizens. It is possible that with age, we gain more experiences to share. It becomes easier to help others because we have more accumulated company and life experiences to draw from.[38] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 4 Attitudes and Behaviors at Work 123 Counterproductive Work Behaviors Counterproductive work behaviors (CWB) is an umbrella term describing the different ways in which employees harm their organizations. CWBs are intentional, so honest mistakes are not considered to be CWBs. Some examples of CWBs include abusing others (gossiping, spreading rumors, harassment, insulting, and embarrassing others), production deviance (intentionally performing at a low level, such as by ignoring instructions or by slowing down and reducing performance), theft (intentionally stealing money or things), sabotage (intentionally damaging equipment and the physical environment), and withdrawal behaviors (taking long breaks, being tardy, or skipping work altogether indicating that the person is physically and mentally somewhere else during work hours).[39] Absenteeism may be considered a CWB, but it may also have legitimate reasons such as poor health. Therefore, we will discuss absenteeism separately in the next section. As you can see, CWBs are harmful behaviors and if left unchecked, they have the potential to seriously harm the organization. However, they are also hard to act on, because management is not always in a position to observe and notice these behaviors. In fact, research has shown that employees admit to performing more of these behaviors than what observers such as supervisors and coworkers report. [40] Why do employees display CWBs? Research has shown that employee personality is a powerful influence. For example, negative affectivity, or experiencing negative emotions very frequently, is a strong correlate of these behaviors, whereas positive affectivity shows the opposite relationship. Further, employees who have higher levels of conscientiousness are less likely to display these behaviors. Aside from personality traits, findings from a meta-analysis showed that job attitudes (job satisfaction and organizational commitment) and, to a lesser extent, organizational justice perceptions were predictors of CWBs. When employees are content with their jobs and organizations, and when they feel that they are treated in a fair manner, with dignity and respect, they are less likely to display these behaviors.[41] counterproductive work behaviors (CWB) Intentional employee behaviors that harm the organization. Frustrated and feeling poorly treated, a luggage handler working in Changgi Airport in Singapore swapped 286 luggage tags, sending them to wrong destinations. The employee was sentenced to 20 days in jail, while his employer dealt with all the complaints and spent thousands of dollars to compensate the customers. Absenteeism Absenteeism refers to unscheduled absences from work. Such absences are costly to companies because of their unpredictable nature. When an employee has an unscheduled absence from work, companies struggle to find replacement workers at the last minute. This may involve hiring contingent workers, having other employees work overtime, or scrambling to cover for an absent coworker. According to the Bureau of Labor Statistics, nearly 3% of an employer’s workforce will be absent every day.[42] A SHRM/Kronos study estimated that absenteeism costs employers 21%–22% of total payroll.[43] While absenteeism is a problem organizations needs to deal with, they need to be careful not to encourage presenteeism, or employees showing up to work when they are sick. Creating a strong attendance culture to combat absenteeism may create the opposite problem of presenteeism, resulting in slower recovery for the employee, and contagion of illnesses.[44] What causes absenteeism? Some absenteeism is related to health reasons. For example, reasons such as lower back pain, migraines, accidents on or off the job, or acute stress are important reasons for absenteeism.[45] Health-related absenteeism is costly, but it would be unreasonable and unfair to institute organizational policies penalizing such absences. When an employee has a contagious illness, showing up at work will infect coworkers and will not be productive. Indeed, companies are finding that programs aimed at keeping workers healthy are effective in dealing with this type of absenteeism. Companies using wellness programs, educating employees about proper nutrition, helping them exercise, and rewarding them for healthy habits, have reported reduced absenteeism. In fact, a transportation authority in Austin, Texas, notes that the return on investment of their wellness program focusing on weight loss and nutrition is $2.50 for every dollar spent.[46] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Efired/Shutterstock.com absenteeism Unscheduled absences from work. presenteeism Showing up to work despite being sick. 124 Organizational Behavior A common reason for absenteeism is health problems. Companies using wellness programs targeting employee health are found to reduce absenteeism. Shutterstock.com Work-life balance is another common reason for absences. Staying home to care for a sick child or relative, attending the wedding of a friend or relative, or skipping work to study for an exam are all common reasons for unscheduled absences. Companies may deal with these by giving employees more flexibility in work hours. If employees can manage their own time, they are less likely to be absent. Organizations such as Lahey Clinic Foundation Inc. in Burlington, Massachusetts, find that instead of separating sick leave and paid time off, merging them is effective in dealing with unscheduled absences. When a company has “sick leave” but no other leave for social and family obligations, employees may fake being sick and use their “sick leave.” Instead, having a single paid time off policy would allow workers to balance work and life, and allow companies to avoid unscheduled absences. Some companies such as IBM Corporation got rid of sick leave altogether and instead allow employees to take as much time as they need, as long as their work gets done.[47] Sometimes, poor work attitudes lead to absenteeism. When employees have poor job attitudes, or perceive that they are treated unfairly, they are likely to be absent from work more often. Interestingly, not everyone who is unhappy at work will increase their absenteeism: employees differ in how “guilt prone” they are. Those employees with greater tendency to feel guilty will continue to show up to work even when unhappy, whereas individuals with lower tendency to feel guilt in general are the ones who are absent from work when unhappy.[48] Research does not reveal a consistent link between personality and absenteeism. One demographic criterion that predicts absenteeism is age. Interestingly, and counter to the stereotype that increased age would bring more health problems, research shows that age is negatively related to both frequency and duration of absenteeism. Because of reasons including higher loyalty to their company and a stronger work ethic, older employees are less likely be absent from work.[49] OB Toolbox: Dealing with Late Coworkers Shutterstock.com Do you have team members that are chronically late to group meetings? Are your coworkers driving you crazy because they are perpetually late? Here are some suggestions that may help. • Try to get to the root cause and find out what is making your coworker unhappy. Often, lateness is an extension of dissatisfaction one feels toward the job or tasks at hand. If there are ways in which you can solve these issues, such as by giving the person more responsibility or listening to their opinions and showing more respect, you can minimize lateness. • Make sure that lateness does not go without any negative consequences. Do not ignore it, and do not remain silent. Mention carefully and constructively that one person’s lateness slows down everyone. • Make an effort to schedule meetings around everyone’s schedules. When scheduling, emphasize the importance of everyone’s being there on time and pick a time when everyone can comfortably attend. • When people are late, be sure to ask them to compensate, such as by doing extra work. Negative consequences tend to discourage future lateness. • Shortly before the meeting starts, send everyone a reminder. Yes, you are dealing with adults and they should keep their own schedules, but some people’s schedules may be busier than others, and some are better at keeping track of their time. Reminders may ensure that they arrive on time. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 4 Attitudes and Behaviors at Work 125 • Reward timeliness. When everyone shows up on time, verbally recognize the effort everyone made to be there on time. • Be on time yourself! Creating a culture of timeliness within your group requires everyone’s effort, including yours. Turnover Turnover refers to an employee leaving an organization. Turnover may be voluntary or involuntary. Voluntary turnover refers to departure initiated by the employee, whereas involuntary turnover is initiated by the organization, which includes termination and layoffs. High turnover has potentially harmful consequences for the organization, particularly for customer service, quality and service performance, and workplace safety.[50] When employees leave, their jobs still need to be performed by someone, so companies spend time recruiting, hiring, and training new employees, all the while suffering from lower productivity. Yet, not all turnover is bad. Turnover is particularly a problem when high-performing employees leave, while a poor performer’s turnover may actually give the company a chance to improve productivity and morale. Why do employees leave? An employee’s performance level is an important reason. People who perform poorly are actually more likely to leave. These people may be fired or be encouraged to quit, or they may quit because of their fear of being fired. If a company has pay-for-performance systems, poor performers will find that they are not earning much, owing to their substandard performance. This pay discrepancy gives poor performers an extra incentive to leave. On the other hand, instituting a pay-for-performance system does not mean that high performers will always stay with a company. Note that high performers may find it easier to find alternative jobs, so when they are unhappy, they can afford to quit their jobs voluntarily.[51] Work attitudes are often the primary culprit in why people leave. When workers are unhappy at work, and when they are not attached to their companies, they are more likely to leave. Loving the things they do, being happy with the opportunities for advancement within the company, and being happy about pay are all aspects of work attitudes relating to turnover. Of course, the link between work attitudes and turnover is not direct. When employees are unhappy, they might have the intention to leave and may start looking for a job, but their ability to actually leave will depend on many factors such as their employability and the condition of the job market. Events that erode employee engagement may increase turnover rate in a company. For example, one study showed that downsizing of a company’s workforce by 1% was followed by a 31% increase in voluntary turnover the next year.[52] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Jobs in retail are historically among the highest in turnover. Shutterstock.com turnover Employee departure from an organization. 126 Organizational Behavior Research shows that acting positive at work can actually help you become happier over time as emotions can be influenced by actions. People are more likely to quit their jobs if they experience stress at work as well. Stressors such as role conflict and role ambiguity drain energy and motivate people to seek alternatives. For example, call-center employees experience a great deal of stress in the form of poor treatment from customers, long work hours, and constant monitoring of their every action. Companies such as EchoStar Corporation realize that one method for effectively retaining their best employees is to give employees opportunities to move to higher responsibility jobs elsewhere in the company. When a stressful job is a step toward a more desirable job, employees seem to stick around longer.[53] There are also individual differences in whether people leave or stay with organizations. For example, personality is a factor in the decision to quit one’s job. People who are conscientious, agreeable, and emotionally stable are less likely to quit their jobs. Many explanations are possible. People with these personality traits may perform better at work, which leads to lower turnover. Or they may have better relations with coworkers and managers, which is a factor in their retention. Whatever the reason, it seems that some people are likely to stay longer at any given job regardless of the circumstances.[54] Shutterstock.com job embeddedness A condition where people have strong links and fit with their organization and job, thus leaving would entail a large number of sacrifices. Whether we leave a job or stay also depends on age and how long we have been at an organization. It seems that younger employees are more likely to leave. This is not surprising because people who are younger often have fewer responsibilities such as supporting a household or having dependents. As a result, they can quit a job they don’t like more easily. They may also have higher expectations and thus be more easily disappointed when a job proves to be less rewarding than they had imagined. Similarly, people who have been with a company for a short period of time may quit more easily. For example, Sprint Corporation (formerly known as Sprint Nextel) found that many of their new hires were quitting within 45 days of their hiring dates. When they investigated, they found that newly hired employees were experiencing a lot of stress from avoidable problems such as unclear job descriptions or problems hooking up their computers. Sprint was able to solve the turnover problem by paying special attention to orienting new hires. New employees experience a lot of stress at work, and there is usually not much keeping them in the company, such as established bonds to a manager or colleagues. New employees may even have ongoing job interviews with other companies when they start working. This, too, gives them the flexibility to leave more easily. In addition to examining why employees leave, researchers also examined why people stay in an organization. There are various factors at work that prevent employees from leaving. Sometimes it is hard or undesirable for people to leave because they have strong ties to the place. This idea is represented by the concept job embeddedness. Individuals have high job embeddedness when they have strong links to other people and their communities, have high fit with their jobs and organizations, and when leaving their job would entail many sacrifices (such as valuable benefits, giving up well-liked colleagues, or having to give up the prestige of working at a well-known company). Having high job embeddedness reduces the likelihood of turnover, and serves as a buffer for the factors that would ordinarily push individuals to leave their jobs.[55] For example, one study showed that organizational corporate social responsibility was positively related to pride in working there, which was related to higher levels of job embeddedness, and therefore lower probability of leaving the organization.[56] OB Toolbox: Tips for Leaving Your Job Gracefully Shutterstock.com © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 4 Attitudes and Behaviors at Work Few people work in one company forever, and someday you may decide that your current job is no longer right for you. Here are tips on how to leave without burning any bridges. • Don’t quit on an impulse. We all have bad days and feel the temptation to walk away from the job right away. Yet, this is unproductive for your own career. Plan your exit in advance, look for a better job over an extended period of time, and leave when the moment is right. • Don’t quit too often. While trading jobs in an upward fashion is good, leaving one place and getting another job that is just like the previous one in pay, responsibilities, and position very frequently does not help you move upward in your career, and may lead to the perception that you are a “job hopper.” • When you decide to leave, tell your boss first, and be professional. Explain your reasons without blaming anyone and frame it as an issue of poor job fit. • Do not badmouth your employer. It is best not to bash the organization you are leaving in front of coworkers. Do not tell them how happy you are to be quitting or how much better your new job looks. There is really no point in making any remaining employees feel bad. • Guard your professional reputation. The world is a small place. People know others and tales of unprofessional behavior travel quickly to unlikely places. • Finish your ongoing work and don’t leave your team in a bad spot. Right before a major deadline is probably a bad time to quit. Offer to stay at least two weeks to finish your work, and to help hire and train your replacement. • Don’t steal from the company! Give back all office supplies, keys, ID cards, and other materials. Don’t give them any reason to blemish their memory of you. Who knows…you may even want to come back one day. Key Takeaway Employees demonstrate a wide variety of positive and negative behaviors at work. Among these behaviors, five are critically important and have been extensively studied in the OB literature. Job performance is a person’s accomplishments of tasks listed in one’s job description. A person’s abilities, particularly mental abilities, are the main predictor of job performance in many occupations. How individuals are treated at work, the level of stress experienced there, work attitudes, and, to a lesser extent, our personality are also factors relating to one’s job performance. Citizenship behaviors are tasks helpful to the organization but are not in one’s job description. Performance of citizenship behaviors is less a function of our abilities and more of motivation. How we are treated at work, personality, work attitudes, and our age are the main predictors of citizenship. Among negative behaviors at work, counterproductive work behaviors, absenteeism, and turnover are critically important. Counterproductive behaviors are often a result of personality traits, job attitudes, and unfair treatment. Health problems and work-life balance issues contribute to absenteeism. Poor work attitudes are also related to absenteeism, and younger employees are more likely to be absent from work. Turnover is higher among low performers, people who have negative work attitudes, and those who experience a great deal of stress. Personality and youth are personal predictors of turnover. What do you think? 1. What is the difference between performance and organizational citizenship behaviors? How would you increase someone’s performance? How would you increase citizenship behaviors? 2. Are citizenship behaviors always beneficial to the company? If not, why not? Can you think of any citizenship behaviors that employees may perform with the intention of helping a company but that may have negative consequences overall? 3. Given the factors correlated with job performance, how would you identify future high performers? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 127 128 Organizational Behavior 4. Have you ever observed counterproductive behaviors at work or school? Why did they happen? How could they have been prevented? 5. In some companies, managers are rewarded for minimizing the turnover within their department or branch. A part of their bonus is tied directly to keeping the level of turnover below a minimum. What do you think about the potential effectiveness of these programs? Do you see any downsides to such programs? 4.4 Focus on Attitudes and Behaviors, Ethics, Technology, and National Culture Learning Objectives 1. Consider the role of job attitudes in ethical behavior. 2. Consider the relationship between job attitudes, behaviors, and technology. 3. Consider the role of national culture in job attitudes and behaviors. Job Attitudes, Behaviors, and Ethics Shutterstock.com whistleblowers People who report wrongdoing. People prefer to work in companies that have an ethical environment. Studies show that when an organization has a moral climate that values doing the right thing, people tend to be happier at work, more committed to their companies, and less likely to want to leave. In other words, in addition to increasing the frequency of ethical behaviors, the presence of an ethical climate will attach people to a company. An ethical climate is related to performing citizenship behaviors in which employees help each other and their supervisors, and perform many behaviors that are not part of their job descriptions. People working in ethical climates also take fewer sickness-related absences and are at lower risk of turnover.[57] If employees are happy at work and committed to the company, do they behave more ethically? This connection is not as clear. In fact, loving your job and being committed to the company may prevent you from realizing that the company is doing something wrong. One study showed that job engagement was related to feeling a sense of psychological ownership, which was related to both positive outcomes (such as higher levels of citizenship behavior), and negative outcomes (such as territorial behavior, knowledge hiding, and pro-job unethical behaviors such as excluding others to make oneself more valuable). In a different study, employees who were highly committed to a company were less likely to recognize organizational wrongdoing and less likely to report the problem to people within the organization. Whistleblowers, or people who reported wrongdoing, were more likely to have moderate levels of commitment to the company. These studies show that positive attitudes are no guarantee for ethical behaviors.[58] Companies trying to prevent employees from behaving unethically face a dilemma. One way of reducing unethical behaviors is to monitor employees closely. However, when people are closely monitored through video cameras, when their emails are routinely read, and when their online activities are closely tracked, employees are more likely to feel that they are being treated unfairly © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 4 Attitudes and Behaviors at Work 129 and with little respect. Therefore, high levels of employee monitoring, while reducing the frequency of unethical behaviors, may reduce job satisfaction and commitment, as well as work performance and citizenship behaviors. Instead of monitoring and punishing employees, organizations can reduce unethical behavior by creating an ethical climate and making ethics a shared value.[59] Job Attitudes, Behaviors, and Technology Organizations are increasingly digitizing, automating, and changing the nature of work through increased use of technology. How these changes affect employee job attitudes and behaviors depends on the process of change and how each change affects the employees in question. For example, if employees feel that digitization is taking away their job security and resulting in reductions in job complexity, it is natural that its use will lead to poorer job attitudes. At the same time, if increased use of technology is removing the repetitive and unpleasant aspects of jobs, and if organizations invest in their employees to provide them with training and career paths to ensure that technology results in positive changes in employees’ jobs and careers, the effects will be more positive. Advances in technology require employees with new specialized skills, and given the absence of these skills in the workforce or even in the job market, upskilling, or teaching employees new skills, becomes a priority. For example, AT&T partnered with Georgia Tech and Udacity (an online education company providing large-scale online courses) to increase data analytics skills of employees and provided employees with additional career paths.[60] Shutterstock.com upskilling Teaching employees new skills. While technology makes organizations more efficient and saves them money, it also results in job loss. Historically, the jobs that were lost were those with lower skill demands, but today, jobs with higher skill demands are no longer immune, with artificial intelligence slowly replacing humans in jobs that demand decision-making skills. LifePerson, a company that designs chatbots can reduce a call center with 1,000 employees to an operation that runs with 100 employees and chatbots. The government incentivizes investments in machinery and new technology via tax breaks, but similar incentives do not exist for retraining employees losing their jobs. Large firms with adequate resources are capable of taking the initiative to help employees who will lose their jobs to technology. For example, Amazon’s career choice program pays employees their regular wages while they take online classes that help them prepare for higher paying jobs in their communities. Such programs have the potential to combat fears that technology will replace employees.[61] As we have seen in this chapter, interpersonal connections and relationships matter a great deal for workplace attitudes and behaviors. With increased work from home, or increased workplace changes resulting in shuffling of workgroups, employees may feel lonely at work. While technology may contribute to loneliness at work, it may also provide some solutions. For example, Dollar Shave Club uses the communication platform Slack to pair employees who do not know each other to have them share lunch together (the company pays the bill). Job Attitudes Around the Globe Do the same factors satisfy people around the globe? Even though many of the findings regarding satisfaction are generalizable to different cultures, some research reveals that differences also exist. In one study comparing job satisfaction in 20 countries, work–family conflict was found to lower job satisfaction only in individualistic cultures. It is possible that in collectivistic cultures, when people have to make sacrifices for work, they may compensate by forming better relations with coworkers, which prevents employees from being dissatisfied. There is also evidence that while autonomy and empowerment are valued in the United States, Mexico, and Poland, high levels of empowerment were related to lower job satisfaction in India.[62] With respect to personality, research has shown that agreeableness had stronger relations with organizational commitment in © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Shutterstock.com 130 Organizational Behavior collectivistic cultures.[63] Despite some variation, major factors that make people happy, such as being treated well and having good relations with others, are likely to generalize across cultures. Culture also influences work behaviors. Behaviors regarded as a citizenship behavior in the United States or other Western cultures, such as helping a new coworker learn the job, may be viewed as part of a person’s job performance in other cultures. Research shows that managers in Hong Kong and Japan define job performance more broadly. For example, the willingness to tolerate less-than-ideal circumstances within the company without complaining was viewed as part of someone’s job in Hong Kong, whereas this was viewed as more discretionary in the United States and Australia. Factors that are effective in reducing absenteeism and turnover also vary around the globe. For example, one study on 21 countries showed that the use of flexible work arrangements was more helpful in reducing absenteeism and turnover in cultures with low power distance and high individualism.[64] Key Takeaway There is a connection between a company’s ethics climate, work attitudes, and citizenship behaviors demonstrated by employees. A highly committed workforce may not necessarily demonstrate higher levels of ethics, because highly committed people may be less likely to notice companywide wrongdoing and, in turn, not report it. Companies have to strike a balance between reducing unethical behaviors and maintaining a highly satisfied and committed workforce. Some tactics of reducing unethical behaviors, such as close monitoring of employees, may erode trust between management and employees and lead to negative work attitudes. There are cross-cultural differences in how employee work attitudes are shaped and the work behaviors that are expected from employees. Being aware of these differences facilitates effective management of a global workforce. What do you think? 1. As businesses increasingly allow employees to work from home, how can they ensure that employees continue to follow the organization’s ethical expectations? 2. Given the fast pace of technological changes in the world of work, what can you do to “future proof” your career? How can you maintain your employability and career success despite any future changes that may occur? 3. Which factors related to work attitudes in Western cultures should also be related to work attitudes in other cultures? Are there any that you think would not be important in a different culture you are familiar with? 4. Do you think people leave their jobs for the same reasons around the world? If not, explain why you think so. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 4 Attitudes and Behaviors at Work 4.5 People Come First: The Case of SAS Casimiro PT/Shutterstock.com Who are your best customers? Which customers are bringing you the most profits and which are the least profitable? Companies are increasingly relying on complicated data-mining software to answer these and other questions. SAS Institute Inc. is the second largest privately held software company in the United States; of the top 100 companies from the 2018 Fortune Global 1000 list, 92 are SAS customers. Founded in 1976, SAS has its headquarters in Cary, North Carolina. The company that began as a research project designed to analyze farming data is doing extremely well by any measure. As of 2019, they had nearly 14,000 employees worldwide, were installed in 147 countries at over 83,000 locations, and reported $3.3 billion in revenue in 2018. The company is quick to attribute their success to the performance and loyalty of their workforce. This is directly correlated with how they treat their employees. SAS, which stands for Statistical Analysis System, has perfected the art of employee management. Jenn Mann, VP for HR at SAS is quoted as saying, “SAS employees understand how important their contribution is for the company’s success. Our stimulating work environment and high levels of trust provide employees with the freedom to test new ideas while maintaining a healthy work-life balance. This recognition proves yet again that happy, creative employees drive results.” SAS has been ranked on Fortune magazine’s best places to work list every year since the list was first published, including being named number 1 in 2010 and 2011. Employees seem to genuinely enjoy working at SAS and are unusually attached to the company, resulting in a turnover rate that is less than 5% in an industry where 13.5% is the norm. In fact, when Google designed their own legendary campus in California, they visited the SAS campus to get ideas. One thing SAS does well is giving its employees opportunities to work on interesting and challenging projects. The software developers have the opportunity to develop cutting-edge software to be used around the world. The company makes an effort to concentrate its business in the areas of analytics, which add the most value and help organizations best analyze disparate data for decision making, creating opportunities for SAS workers to be challenged. Plus, the company removes obstacles for employees. Equipment, policies, rules, and meetings that could impede productivity are eliminated. The company has a reputation as a pioneer when it comes to the perks it offers employees, but these perks are not given with a mentality of “offer everything but the kitchen sink.” There is careful thinking and planning behind the choice of perks the company offers. SAS conducts regular employee satisfaction surveys, and any future benefits and perks offered are planned in response to the results. The company wants to eliminate stressors and anything that dissatisfies from people’s lives. To keep employees healthy and fit, there are athletic fields; a full gym; a swimming pool where employees can swim or play inner tube water polo; and tennis, basketball, and racquet- © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 131 132 Organizational Behavior ball courts on campus. Plus, the company offers free on-site health care for employees, covers dependents at their fully staffed primary medical care center, provides flexible scheduling, and offers unlimited sick leave. The company understands that employees have a life and encourages employees to work reasonable hours and then go home to their families. In fact, a famous motto in the company is, “If you are working for more than eight hours, you are just adding bugs.” SAS is truly one of the industry leaders in leveraging its treatment of people for continued business success.[65] Multimedia Extension—SAS Campus Tour View in the online reader Case Discussion Questions 1. SAS is involved in cutting-edge technology. Does this give it a distinct advantage in employee retention and satisfaction over, for example, a manufacturing company or a food retailer? 2. Do you feel that investing heavily in employee perks ultimately pays off for a company? Would you feel the same way during hard economic times, when the pool of highly qualified workers grows and the number of available jobs shrinks dramatically? 3. How much of an advantage does SAS have, given that the company produces analytic software to help businesses improve their functionality? 4. In addition to giving employees interesting and challenging projects, SAS also places a high level of trust in its employees. In your opinion, how do these factors contribute to employee creativity and innovation? 5. What do you think you’d like about working at SAS? What would you not potentially like? 4.6 Conclusion Work attitudes are our feelings toward our company and job. Job satisfaction, organizational commitment, and job engagement are related to many outcomes of interest, such as absenteeism, performance, and turnover. Therefore, companies track feelings toward work and try to create more positive attitudes. The main behaviors that contribute to organizational effectiveness are job performance, citizenship behaviors, counterproductive work behaviors, absenteeism, and turnover. These behaviors are affected by a complex blend of personality and situational factors, and factors © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 4 Attitudes and Behaviors at Work affecting these behaviors and work attitudes will be examined in more detail in other chapters of this book. 4.7 Exercises Ethical Dilemma You are a department manager in an advertising agency. The employees of the department have recently completed an attitude survey. Three employees in your department reported that they were harassed by senior people in the department and they are experiencing a hostile work environment. You do not know who these people are, but you feel that you need to do something. The surveys were filled out confidentially, and employees were assured that their identities would not be revealed to management. You feel that you can identify who they are because the person in HR who administered the survey is a friend of yours and that person can tell you the demographics of the employees, which would help you identify them. 1. Should you ask for the identity-revealing information? What are the advantages and disadvantages of finding out the identity of these people? 2. How would you handle a situation like this now and in the future? Individual Exercise Responding to Employees’ Public Criticisms of the Company You are a manager at a Fortune 500 firm. You just found out that an employee reporting to you started blogging about his experience working in your company. The employee is vocal that pay is very low for the work he does, and he has many complaints relating to lack of growth opportunities and broken promises. You fear that this blog is damaging the organization’s reputation, as it developed a large group of followers. The employee seems to be posting outside of work hours, and is in general a productive employee. 1. What action would you take when you learn the presence of this blog? Would you take action to stop this blogger? How? 2. A friend of yours suggests that this is a serious offense and the employee should be fired. What do you think of this suggestion? What are the possible consequences of taking this action? 3. What would you change within the company to deal with this situation? 4. Would you post on this blog? If so, under what name, and what comments would you post? Group Exercise Exit Interview Role-Play and Developing an Attitude Survey This role-play will be played by three students. One student will be an employee from the human resources (HR) department conducting the interview, the second will be the employee who is leaving, and the third will be an observer. The HR employee and the departing employee will conduct an exit interview. At the conclusion of the interview, the observer will provide feedback to the HR employee regarding how the interview could have been improved and how the employee could have been more open. Part 1: Role-Play © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 133 134 Organizational Behavior Be sure to read only the role sheet assigned to you. Part 2: Review In groups of three, review the information gathered from the exit interview. Many of these problems may be affecting the rest of the employees. Develop an attitude survey to be distributed to remaining employees of this company. Develop questions based on what came out of the interview as well as other areas you feel may be important to know. Discuss how the surveys would be administered and what would be done to (a) have a high response rate and (b) ensure the accuracy of responses. Endnotes 1. Case written by Berrin Erdogan and Talya Bauer to accompany T. N. Bauer & B. Erdogan (2021). Organizational Behavior: Bridging Science and Practice (4.0). Boston, MA: FlatWorld. Partially based on ideas and information contained in Davies, N. (October 11, 2019). "Happiness crews" and "culture committees" are making isolated workers feel less lonely. 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Managing for creativity. Harvard Business Review, 83(7/8), 124–131; Fortune (2017). SAS on Fortune Best Companies to Work for list. http://fortune.com/best-companies/sas/; SAS (2012). SAS on Fortune Best Companies to Work for list in US. Retrieved from http://www.sas.com/news/preleases/2012fortuneranking.html; Karlgaard, R. (2006, October 16). Who wants to be public? Forbes Asia, 2(17), 22; Forbes (n.d.). America’s largest private companies: 2019 ranking. Retrieved from https://www.forbes.com/largest-private-companies/ list/#tab:rank; SAS. (2019). About SAS. Retrieved from https://www.sas.com/en_us/company-information/profile.html; SAS (2019). 2018 corporate social responsibility. Retrieved from https://www.sas.com/content/dam/SAS/en_us/doc/other1/ csr-107835.pdf CHAPTER 5 Theories of Motivation at Work Shutterstock.com Learning Objectives After reading this chapter, you should be able to do the following: 1. Understand the role of motivation in determining employee performance. 2. Classify the basic needs of employees. 3. Describe how fairness perceptions are determined and consequences of these perceptions. 4. Understand the importance of rewards and punishments. 5. Apply motivation theories to analyze performance problems. 6. Understand connections between motivation at work and ethics, technology, and cross-cultural management. Why do some employees try to reach their targets and pursue excellence while others merely show up at work and count the hours? As with many questions involving human beings, the answer is anything but simple. Instead, there are several theories explaining the concept of motivation. We will discuss motivation theories under two categories in this chapter: need-based theories and process-based theories. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 138 Organizational Behavior 5.1 Motivated Employees: The Case of Patagonia Sundry Photography/Shutterstock.com Patagonia was founded in 1973 by Yvon Chouinard, a passionate outdoorsman who wanted to design clothing and gear inspired by his love of the outdoors. Since then, the company has grown to over 2,000 employees and several hundred million dollars in annual revenue. Patagonia specializes in durable, high-end gear for surfers, climbers, skiers, and runners. It is a privately held benefit corporation, which means its board is not accountable to public shareholders. According to Chouinard, Patagonia intentionally hires people who are highly self-motivated to enable the company to encourage employee autonomy and maintain a relatively flat structure. The founder says, “I hate the idea of managing people. I don’t like people telling me what to do, so I can’t stand to tell other people what to do.” He even wrote a book called Let My People Go Surfing, which provides an overview of the company’s unique history and philosophy, which is now used for employee onboarding purposes. According to Patagonia’s Chief Human Resources Officer, Dean Carter, “There’s just no reference for reporting relationships or traditional hierarchies. As a matter of fact, we like breaking them because, often, the best ideas aren’t from the manager; they’re from the person whose hands are dirty doing the real work.” The company embraces the philosophy that the manager should be more of a mentor than a boss. To drive home this point, the company did away with the traditional annual performance ratings so employees don’t feel like their managers are constantly judging them. Patagonia is also known for providing exceptional benefits and perks, including a subsidized café, onsite childcare for employees (introduced in 1981—well before most companies), and flexible scheduling. The company provides childcare as a service to its employees but also treats it as an opportunity to groom future leaders by encouraging socialization and instilling confidence at a young age. As for the flexible work policy, according to Carter, people are allowed to take whatever time they need as long as they are getting their work done. He says, “People are encouraged to live the lives they want and do what they need to do, whether that’s horseback riding, surfing, or seeing their kids play. If we’re hiring independent people who care about the environment and the outdoors, we certainly can’t have a culture that doesn’t allow them to do those things.” This value is also reflected in the company’s policy discouraging lunchtime meetings so employees can practice yoga or go running. Patagonia even promised to keep employees on the payroll during coronavirus-related store closures in 2020, further highlighting the value the organization places on its employees. The company is able to support this level of autonomy and flexibility by hiring strategically. They take their time to find the right candidate for each position, prioritizing characteristics like independence, passion, and ambition. Then they provide new hires with an immersive orientation and onboarding process, with significant access to senior leadership. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work Patagonia’s nontraditional approach to employee engagement and company culture seems to be paying off. Employee turnover is very low at 4%, and 100% of women who have taken maternity leave from the company have returned to work. The company is also in a strong financial position. According to Carter, “We’re experiencing double-digit growth, despite our desire to control growth, at a time when most retailers and wholesalers are reeling, and even though 1% of our top-line sales are going to the environment.”[1] Multimedia Extension—Patagonia Supports Paid Leave View in the online reader Case Discussion Questions 1. What are some of the things that make Patagonia a unique workplace? Do you think these contribute to employee motivation? 2. Would you like to work for a company that gave you as much autonomy as Patagonia gives its employees? Why or why not? 3. Do you think Patagonia’s company culture contributes to a positive work/life balance for its employees? How might this relate to motivation? 4. Do you think Patagonia has enjoyed so much success due to its unique company culture, or despite it? Explain. 5. Of all the employee perks that Patagonia offers, which ones would be the most motivating for you? Why? 5.2 Understanding Motivation Learning Objectives 1. Understand the performance equation. 2. Explain the difference between intrinsic and extrinsic motivation. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 139 140 Organizational Behavior What inspires employees to provide excellent service, market a company’s products effectively, or achieve the goals set for them? Answering this question is of utmost importance if we are to understand and manage the work behavior of our peers, subordinates, and even supervisors. Put a different way, if someone is not performing well, what could be the reason? Job performance is viewed as a function of three factors and is expressed with the following equation.[2] According to this equation, motivation, ability, and environment are the major influences over employee performance. FIGURE 5.1 Factors of Job Performance Motivation, ability, and environment are the major influences over employee performance. motivation The desire to achieve a goal or a certain performance level, leading to goal-directed behavior. ability Having the skills and knowledge required to perform the job. environmental External factors that affect performance. Motivation is one of the forces that leads to performance. Motivation is defined as the desire to achieve a goal or a certain performance level, leading to goal-directed behavior. When we refer to someone as being motivated, we mean that the person is trying hard to accomplish a certain task. Motivation is clearly important if someone is to perform well; however, it is not sufficient on its own. Ability—or having the skills and knowledge required to perform the job—is also important and is sometimes the key determinant of effectiveness. Finally, environmental factors such as having the resources, information, and support one needs to perform well are critical to determine performance. At different times, one of these three factors may be the key to high performance. For example, for an employee sweeping the floor, motivation may be the most important factor that determines performance. In contrast, even the most motivated individual would not be able to successfully design a house without the necessary training involved in building quality homes. In the end, when we say someone is motivated, we mean that they want to try hard and perform well. Being motivated is not the same as being a high performer and is not the sole reason why people perform well, but it is nevertheless a key influence over our performance level. Intrinsic and Extrinsic Motivation intrinsic motivation Pursuing an activity because it is inherently enjoyable and absent of apparent rewards. extrinsic motivation Performing an activity because it is related to desirable outcomes such as financial rewards, status, or approval from others. Why do you read a book, watch movies, or decide to learn to play the guitar? Or travel, go hiking, or spend time in the garden? There may be many reasons why you engage in these activities, but if your answer is because they are fun and you enjoy them, you are describing intrinsic motivation. Intrinsic motivation refers to pursuing an activity because it is inherently enjoyable and absent of apparent rewards. Other activities are driven by external rewards. For example, reading a book because you have to write a book report, or cooking a meal because someone pays you are examples of extrinsically motivated activities. Extrinsic motivation refers to performing an activity because it is related to desirable outcomes such as financial rewards, status, or approval from others.[3] The distinction between intrinsic and extrinsic motivation is important, and has been subject to much debate. For a long time, scientific literature worked under the assumption that the presence of extrinsic rewards made a task intrinsically less motivating. There is some appeal in this idea: When we do something for money, we may enjoy it less. An example of this phenomenon would be the professional chef who refuses to make meals at home. However, recent meta-analytic © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work evidence does not support this idea. Specifically, research shows that a) when individuals are intrinsically motivated, they tend to perform well b) when there are indirect rewards for performance, performance was largely a function of intrinsic motivation, c) when there are direct rewards for performance, the importance of intrinsic motivation lessened, and rewards became a more powerful predictor of performance; and d) having rewards did not reduce intrinsic motivation, and in fact increased it. Finally, intrinsic motivation mattered more for performance quality, whereas external rewards mattered more for performance quantity. These results suggest that both intrinsic and extrinsic motivation matter for understanding employee performance. When reading the remainder of the chapter, we would encourage you to consider the effects of different motivators for extrinsic and intrinsic motivation.[4] Key Takeaway Job performance is a function of motivation, ability, and environment. This is important, because if the root causes of poor performance are misdiagnosed, we cannot hope to correct it. Employees may be motivated to perform a specific task due to intrinsic or extrinsic motivation. Both matter for performance. What do you think? 1. What are the implications of assuming that a performance problem is due to lack of motivation, as opposed to lack of ability? How different would a manager’s reactions be to an employee lacking motivation as opposed to ability? 2. If an employee is intrinsically motivated to perform a task, is it a good idea to introduce external rewards for performance? Why or why not? 5.3 Need-Based Theories of Motivation Learning Objectives 1. Explain how employees are motivated according to Maslow’s hierarchy of needs. 2. Explain how the ERG (existence, relatedness, growth) theory addresses the limitations of Maslow’s hierarchy. 3. Describe the differences among factors contributing to employee motivation and how these differ from factors contributing to dissatisfaction. 4. Describe need for achievement, power, and affiliation, and identify how these acquired needs affect work behavior. The earliest studies of motivation involved an examination of individual needs. Specifically, early researchers thought that employees are motivated to satisfy their needs. For example, an employee who is always walking around the office talking to people may have a need for companionship and this behavior may be a way of satisfying this need. At the time, researchers developed theories to understand what people need. Four theories may be placed under this category: Maslow’s hierarchy of needs, ERG theory, Herzberg’s two-factor theory, and McClelland’s acquired-needs theory. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 141 142 Organizational Behavior Maslow’s Hierarchy of Needs Abraham Maslow is among the most prominent psychologists of the twentieth century and the hierarchy of needs, accompanied by the pyramid that represents how human needs are ranked, is an image familiar to many business students and managers. Maslow’s theory is based on a simple premise: Human beings have needs that are hierarchically ranked.[5] There are some needs that are basic to all human beings, and in their absence, other needs are not even thought about. As we satisfy these basic needs, we start looking to satisfy higher-order needs. Once a lower-level need is satisfied, it no longer serves as a motivator. FIGURE 5.2 Maslow’s Hierarchy of Needs The most basic of Maslow’s needs are physiological needs. Physiological needs refer to the need for air, food, and water. Individuals who are hungry direct their behavior toward finding food. Once fed, the search for sustenance ceases and food no longer serves as a motivator. Once physiological needs are satisfied, people tend to become concerned about their safety needs. Are they safe from danger, pain, or an uncertain future? One level up, social needs refer to the need to bond with other human beings, to be loved, and to form lasting attachments. In fact, having no attachments can negatively affect health and well-being.[6] The satisfaction of social needs makes esteem needs more salient. Esteem needs refer to the desire to be respected by one’s peers, feeling important, and being appreciated. Finally, at the highest level of the hierarchy, the need for self-actualization refers to “becoming all you are capable of becoming.” This need manifests itself by acquiring new skills, taking on new challenges, and behaving in a way that will lead to the satisfaction of one’s life goals. Maslow’s theory was not originally designed for work settings. In fact, the theory was based on his observations of individuals in clinical settings; some of the individual components of the theory found little empirical support. One criticism relates to the order in which the needs are ranked. It is possible to imagine that individuals who go hungry and are in fear for their lives might retain strong bonds to others, suggesting a different order of needs. Moreover, researchers failed to sup- © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work 143 port the arguments that once a need is satisfied it no longer serves as a motivator and that only one need is dominant at a given time.[7] Despite the lack of strong research support, Maslow’s theory found obvious applications in business settings. Understanding what people need gives us clues to understanding them. The hierarchy is a systematic way of thinking about the different needs employees may have at any given point and explains different reactions they may have to similar treatment. An employee who is trying to satisfy esteem needs may feel gratified when her supervisor praises an accomplishment. However, another employee who is trying to satisfy social needs may resent being praised by upper management in front of peers if the praise sets the individual apart from the rest of the group. How can an organization satisfy its employees’ various needs? In the long run, physiological needs may be satisfied by a paycheck, but it is important to remember that pay may satisfy other needs such as safety and esteem as well. Providing generous benefits that include health insurance and company-sponsored retirement plans, as well as offering a measure of job security, will help satisfy safety needs. Social needs may be satisfied by having a friendly environment and providing a workplace conducive to collaboration and communication with others. Company picnics and other social get-togethers may also be helpful if the majority of employees are motivated primarily by social needs (but may cause resentment if they are not and if they have to sacrifice a Sunday afternoon for a company picnic). Providing promotion opportunities at work, recognizing a person’s accomplishments verbally or through more formal reward systems, and conferring job titles that communicate to the employee that one has achieved high status within the organization are among the ways of satisfying esteem needs. Finally, self-actualization needs may be satisfied by the provision of development and growth opportunities on or off the job, as well as by work that is interesting and challenging. By making the effort to satisfy the different needs of each employee, organizations may ensure a highly motivated workforce. ERG Theory ERG theory, developed by Clayton Alderfer, is a modification of Maslow’s hierarchy of needs.[8] Instead of the five needs that are hierarchically organized, Alderfer proposed that basic human needs may be grouped under three categories, namely, existence, relatedness, and growth. Existence corresponds to Maslow’s physiological and safety needs, relatedness corresponds to social needs, and growth refers to Maslow’s esteem and self-actualization. ERG theory’s main contribution to the literature is its relaxation of Maslow’s assumptions. For example, ERG theory does not rank needs in any particular order and explicitly recognizes that more than one need may operate at a given time. Moreover, the theory has a “frustration-regression” hypothesis suggesting that individuals who are frustrated in their attempts to satisfy one need may regress to another. For example, someone who is frustrated by the growth opportunities in his job and progress toward career goals may regress to relatedness need and start spending more time socializing with coworkers. The implication of this theory is that we need to recognize the multiple needs that may be driving individuals at a given point to understand their behavior and properly motivate them. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. existence A need corresponding to Maslow’s physiological and safety needs. relatedness A need corresponding to Maslow’s social needs. growth A need referring to Maslow’s esteem and self-actualization. 144 Organizational Behavior Two-Factor Theory hygiene factors Factors that are extrinsic to the job, such as company policies and working conditions. motivators Factors that are intrinsic to the job, such as achievement and interesting work. Frederick Herzberg approached the question of motivation by asking individuals what satisfies them on the job and what dissatisfies them. Herzberg came to the conclusion that aspects of the work environment that satisfy employees are very different from aspects that dissatisfy them.[9] Herzberg labeled factors causing worker dissatisfaction as “hygiene” factors because these factors were part of the context in which the job was performed, as opposed to the job itself. Hygiene factors include company policies, supervision, working conditions, salary, safety, and security on the job. For example, if you are working in an unpleasant work environment in which your office is too hot in the summer and too cold in the winter, or if you are being harassed and mistreated, you would likely be miserable. However, if these problems were solved (your office temperature is just right and you are never harassed), would you be motivated? Most likely, you would take the situation for granted. In fact, many factors in our work environment are things that we miss when they are absent, but take for granted if they are present. In contrast, motivators are factors that are intrinsic to the job, such as achievement, recognition, interesting work, increased responsibilities, advancement, and growth opportunities. According to Herzberg’s research, motivators, and not hygiene factors, are the conditions that truly motivate employees. In fact, it is possible to think of hygiene factors as those factors that create contentment, whereas motivators are those factors that create high levels of engagement at work. TABLE 5.1 The Two-Factor Theory of Motivation Hygiene Factors Motivators Company policy Achievement Supervision and relationships Recognition Working conditions Interesting work Salary Increased responsibility Security Advancement and growth Herzberg’s research, despite its intuitive appeal, has received its share of criticism.[10] One criticism relates to the primary research methodology employed when arriving at hygiene versus motivators. When people are asked why they are satisfied, they may attribute the causes of satisfaction to themselves, whereas when explaining what dissatisfies them, they may blame the situation. The classification of the factors as hygiene or motivator is not that simple either. For example, the theory views pay as a hygiene factor. However, pay often has symbolic value by showing employees that they are being recognized for their contributions as well as communicating that they are advancing within the company. Similarly, the quality of supervision or the types of relationships employees form with their supervisors may determine whether they are assigned interesting work, whether they are recognized for their potential, and whether they take on more responsibilities. Despite its limitations, the theory can be a valuable aid to managers because it points out that improving the environment in which the job is performed goes only so far in motivating employees. Undoubtedly, contextual factors matter because their absence causes dissatisfaction. However, solely focusing on hygiene factors will not be enough, and managers should also enrich jobs by giving employees opportunities for challenging work, greater responsibilities, advancement opportunities, and a job in which their subordinates can feel successful. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work 145 Acquired-Needs Theory Among the need-based approaches to motivation, David McClelland’s acquired-needs theory is the one that has received the greatest amount of support. According to this theory, individuals acquire three types of needs as a result of their life experiences. These needs are the need for achievement, the need for affiliation, and the need for power. All individuals possess a combination of these needs, and the dominant needs are thought to drive employee behavior. McClelland used a unique method called the Thematic Apperception Test (TAT) to assess the dominant need.[11] This method entails presenting research subjects with an ambiguous picture and asking them to write a story based on it. Take a look at the following picture. Who is this person? What is he doing? Why is he doing it? The story you tell about the man in the picture would then be analyzed by trained experts. The idea is that the stories the photo evokes would reflect how the mind works and what motivates the person. If the story you come up with contains themes of success, meeting deadlines, or coming up with brilliant ideas, you may be high in need for achievement. Those who have high need for achievement have a strong need to be successful. As children, they may have been praised for their hard work, which formed the foundations of their persistence.[12] As adults, they are preoccupied with doing things better than they did in the past. These individuals are constantly striving to improve their performance. They relentlessly focus on goals, particularly stretch goals that are challenging in nature.[13] They are particularly suited to positions such as sales, where there are explicit goals, feedback is immediately available, and their effort often leads to success. In fact, they are more attracted to organizations that are merit based and reward performance rather than seniority. They also do particularly well as entrepreneurs, scientists, and engineers.[14] Are individuals who are high in need for achievement effective managers? Because of their success in lower level jobs where their individual contributions matter the most, those with high need for achievement are often promoted to higher level positions.[15] However, a high need for achievement has significant disadvantages in management positions. Management involves getting work done by motivating others. When a salesperson is promoted to be a sales manager, the job description changes from actively selling to recruiting, motivating, and training salespeople. Those who are high in need for achievement may view managerial activities such as coaching, communicating, and meeting with subordinates as a waste of time and may neglect these aspects of their jobs. Moreover, those high in need for achievement enjoy doing things themselves and may find it difficult to delegate any meaningful authority to their subordinates. These individuals often micromanage, expecting others to approach tasks a particular way, and may become overbearing bosses by expecting everyone to display high levels of dedication.[16] Thematic Apperception Test (TAT) A test that assesses a person’s dominant needs. The type of story you tell by looking at this picture may give away the dominant need that motivates you. Shutterstock.com need for achievement Having a strong need to be successful. If the story you created in relation to the picture you are analyzing contains elements of making plans to be with friends or family, you may have a high need for affiliation. Individuals who have a high need for affiliation want to be liked and accepted by others. When given a choice, they prefer to interact with others and be with friends.[17] Their emphasis on harmonious interpersonal relationships may be an advantage in jobs and occupations requiring frequent interpersonal interaction, such as a social worker or teacher. In managerial positions, a high need for affiliation may again serve as a disadvantage because these individuals tend to be overly concerned about how they are perceived by others. They may find it difficult to perform some aspects of a manager’s job such as giving employees critical feedback or disciplining poor performers. Thus the work environment may be characterized by mediocrity and may even lead to high performers leaving the team. need for affiliation Finally, if your story contains elements of getting work done by influencing other people or desiring to make an impact on the organization, you may have a high need for power. Those with a high need for power want to influence others and control their environment. A high need for power may in fact be a destructive element in relationships with colleagues if it takes the form of seeking and using power for one’s own good and prestige. However, when it manifests itself in more altruistic forms such as changing the way things are done so that the work environment is more need for power © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Wanting to be liked and accepted by others. Wanting to influence others and control their environment. 146 Organizational Behavior positive, or negotiating more resources for one’s department, it tends to lead to positive outcomes. In fact, the need for power is viewed as an important trait for effectiveness in managerial and leadership positions.[18] McClelland’s theory of acquired needs has important implications for the motivation of employees. Managers need to understand the dominant needs of their employees to be able to motivate them. While employees who have a high need for achievement may respond to goals, those with a high need for power would feel motivated when they have the opportunity to influence their work environment and make an impact, and those high in their need for affiliation may be motivated to gain the approval of their peers and supervisors. Finally, those who have a high drive for success may experience difficulties in managerial positions, and making them aware of common pitfalls may increase their effectiveness. Key Takeaway Need-based theories describe motivated behavior as individuals’ efforts to meet their needs. According to this perspective, the manager’s job is to identify what people need and make the work environment a means of satisfying these needs. Maslow’s hierarchy describes five categories of basic human needs, including physiological, safety, social, esteem, and self-actualization needs. These needs are hierarchically ranked, and as a lower level need is satisfied, it no longer serves as a motivator. ERG theory is a modification of Maslow’s hierarchy, in which the five needs are collapsed into three categories (existence, relatedness, and growth). The theory recognizes that when employees are frustrated while attempting to satisfy higher level needs, they may regress. The two-factor theory differentiates between factors that make people dissatisfied on the job (hygiene factors) and factors that truly motivate employees (motivators). Finally, acquired-needs theory argues that individuals possess stable and dominant motives to achieve, acquire power, or affiliate with others. The type of need that is dominant will drive behavior. Each of these theories explains characteristics of a work environment that motivates employees. These theories paved the way for process-based theories that explain the mental calculations employees make to decide how to behave. What do you think? 1. Many managers assume that if an employee is not performing well, the reason must be a lack of motivation. Do you think this reasoning is accurate? What is the problem with this assumption? 2. Review Maslow’s hierarchy of needs. Do you agree with the particular ranking of employee needs? 3. How can an organization satisfy employee needs that are included in Maslow’s hierarchy? 4. Which motivation theory have you found to be most useful in explaining why people behave in a certain way? Why? 5. Review the hygiene factors and motivators in the two-factor theory of motivation. Do you agree with the distinction between hygiene factors and motivators? Are there any hygiene factors that you would consider to be motivators? 6. A friend of yours demonstrates the traits of achievement motivation: This person is competitive, requires frequent and immediate feedback, and enjoys accomplishing things and doing things better than she did before. She has recently been promoted to a managerial position and seeks your advice. What would you tell her? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work 147 5.4 Process-Based Theories Learning Objectives 1. Explain how employees evaluate the fairness of reward distributions. 2. Describe the three types of fairness that affect employee attitudes and behaviors. 3. List the three questions individuals consider when deciding whether to put forth effort at work. 4. Describe how managers can use learning and reinforcement principles to motivate employees. A separate stream of research views motivation as something more than action aimed at satisfying a need. Instead, process-based theories view motivation as a rational process. Individuals analyze their environment, develop thoughts and feelings, and react in certain ways. Process theories attempt to explain the thought processes of individuals who demonstrate motivated behavior. Under this category, we will review equity theory, expectancy theory, and reinforcement theory. Equity Theory Imagine you are paid $12 an hour working as an office assistant. You have held this job for six months. You are very good at what you do, you come up with creative ways to make things easier in the workplace, and you are a good colleague who is willing to help others. You stay late when necessary and are flexible if asked to rearrange priorities or work hours. Now imagine that you find out your manager is hiring another employee who is going to work with you, hold the same job title, and perform the same types of tasks. This employee has more advanced computer skills, but it is unclear whether these will be used on the job. The starting pay for the new hire will be $15 an hour. How would you feel? Would you be as motivated as before, going above and beyond your duties? FIGURE 5.3 Determining Equity Equity is determined by comparing one’s input-outcome ratio with the input-outcome ratio of a referent. When the two ratios are equal, equity exists. If your reaction to this scenario is along the lines of “I would think it's unfair,” your feelings may be explained using equity theory.[19] According to this Source: Based on Adams, J. S. (1965). Inequity in theory, individuals are motivated by a sense of fairness in their interactions. Social Exchange. In L. Berkowitz (Ed.), Advances in experimental social psychology: Vol. 2 (pp. 267–299). Moreover, our sense of fairness is a result of the social comparisons we make. New York: Academic Press. Specifically, we compare our inputs and outcomes with other people’s inputs and outcomes. We perceive fairness if we believe that the input-to-outcome ratio we are bringing into referent the situation is similar to the input-to-outcome ratio of a comparison person, or a referent. PercepA person we compare ourselves to in equity tions of inequity create tension within us and drive us to action that will reduce perceived inequity. theory. There is even neurological evidence that individuals react negatively to equal distribution of outcomes that disregards differences in individual contributions. In other words, our brains react in a way that shows discomfort when rewards are distributed in a way that violates equity theory.[20] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 148 Organizational Behavior What Are Inputs and Outcomes? Inputs are the contributions people feel they are making to the environment. In the previous example, the person’s hard work; loyalty to the organization; amount of time with the organization; and level of education, training, and skills may have been relevant inputs. Outputs are the perceived rewards someone can receive from the situation. For the hourly wage employee in our example, the $12-an-hour pay rate was a core outcome. There may also be other, more peripheral outcomes, such as acknowledgment or preferential treatment from a manager. In the prior example, the person may reason as follows: I have been working here for six months. I am loyal, and I perform well (inputs). I am paid $12 an hour for this (outputs). The new person does not have any experience here (referent’s inputs) but will be paid $15 an hour. This situation is unfair. We should emphasize that equity perceptions develop as a result of a subjective process. Different people may look at the same situation and perceive different levels of equity. For example, another person may look at the same scenario and decide that the situation is fair because the newcomer has computer skills and the company is paying extra for those skills. Who Is the Referent? The referent other may be a specific person as well as a category of people. Referents should be comparable to us—otherwise the comparison is not meaningful. It would be pointless for a student worker to compare himself to the CEO of the company, given the differences in the nature of inputs and outcomes. Instead, individuals may compare themselves to someone performing similar tasks within the same organization or, in the case of a CEO, a different organization. Reactions to Unfairness The equity theory outlines several potential reactions to perceived inequity. Oftentimes, the situation may be dealt with perceptually by altering our perceptions of our own or the referent’s inputs and outputs. For example, we may justify the situation by downplaying our own inputs (I don’t really work very hard on this job), valuing our outcomes more highly (I am gaining valuable work experience, so the situation is not that bad), distorting the other person’s inputs (the new hire really is more competent than I am and deserves to be paid more), or distorting the other person’s outcomes (she gets $15 an hour but will have to work with a lousy manager, so the situation is not unfair). Another option would be to have the referent increase inputs. If the other person brings more to the situation, getting more out of the situation would be fair. If that person can be made to work harder or work on more complicated tasks, equity would be achieved. The person experiencing a perceived inequity may also reduce inputs or attempt to increase outcomes. If the lower paid person puts forth less effort, the perceived inequity would be reduced. Research shows that people who perceive inequity reduce their work performance or reduce the quality of their inputs.[21] Increasing one’s outcomes can be achieved through legitimate means such as negotiating a pay raise. At the same time, research shows that those feeling inequity sometimes resort to stealing to balance the scales.[22] Other options include changing the comparison person (e.g., others doing similar work in different organizations are paid only minimum wage) and leaving the situation by quitting.[23] Sometimes it may be necessary to consider taking legal action as a potential outcome of perceived inequity. For example, if an employee finds out the main reason behind a pay gap is gender related, the person may react to the situation by taking legal action because sex discrimination in pay is illegal in the United States. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work 149 TABLE 5.2 Potential Responses to Inequity Reaction to Inequity Example Distort perceptions Changing one’s thinking to believe that the referent actually is more skilled than previously thought Increase referent’s inputs Encouraging the referent to work harder Reduce own input Deliberately putting forth less effort at work. Reducing the quality of one’s work Increase own outcomes Negotiating a raise for oneself or using unethical ways of increasing rewards such as stealing from the company Change referent Comparing oneself to someone who is worse off Leave the situation Quitting one’s job Seek legal action Suing the company or filing a complaint if the unfairness in question is under legal protection Overpayment Inequity What would you do if you felt you were over-rewarded? In other words, how would you feel if you were the new employee in our student-worker scenario? Originally, equity theory proposed that over-rewarded individuals would experience guilt and would increase their effort to restore perceptions of equity. However, research does not provide support for this argument. Instead, it seems that individuals experience less distress as a result of being over-rewarded.[24] It is not hard to imagine that individuals find perceptual ways to deal with a situation like this, such as believing they have more skills and bring more to the situation compared to the referent person. Therefore, research does not support equity theory’s predictions with respect to people who are overpaid.[25] Individual Differences in Reactions to Inequity Equity theory assumes that once people feel a situation is inequitable, they are motivated to react. However, does inequity disturb everyone equally? Researchers have identified a personality trait that explains different reactions to inequity and named this trait as equity sensitivity.[26] Equitysensitive individuals expect to maintain equitable relationships, and they experience distress when they feel they are over-rewarded or under-rewarded. At the same time, there are some individuals who are benevolents, those who give without waiting to receive much in return, and entitleds, who expect to receive substantial compensation for relatively little input. Therefore, the theory is more useful in explaining the behavior of equity-sensitive individuals, and organizations will need to pay particular attention to how these individuals view their relationships. equity sensitivity A personality trait that explains different reactions to inequity. benevolents Individuals who give without waiting to receive much in return. entitleds Fairness Beyond Equity: Procedural and Interactional Justice Equity theory looks at perceived fairness as a motivator. However, the way equity theory defines fairness is limited to fairness of rewards. Starting in the 1970s, research on workplace fairness began taking a broader view of justice. Equity theory deals with outcome fairness, and therefore it is considered to be a distributive justice theory. Distributive justice refers to the degree to which the © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Individuals who expect to receive a lot without giving much in return. distributive justice The degree to which the outcomes received from the organization are fair. 150 Organizational Behavior outcomes received from the organization are perceived to be fair. Two other types of fairness have been identified: procedural justice and interactional justice. Let’s assume that you just found out you are getting a promotion. Clearly, FIGURE 5.4 Dimensions of this is an exciting outcome and comes with a pay raise, increased responsibilities, Organizational Justice and prestige. If you feel you deserve to be promoted, you would perceive high distributive justice (your getting the promotion is fair). However, you later found out upper management chose you because your father is in the city council. How would you feel? You might still like the outcome but feel that the decision-making process was unfair. If so, you are describing feelings of procedural justice. Procedural justice refers to the degree to which fair decision-making procedures are used to arrive at a decision. People do not care only about reward fairness. They also expect decision-making processes to be fair. In fact, research shows that employees care about the procedural justice of many organizational decisions, including layoffs, employee selection, surveillance of employees, performance appraisals, and pay decisions.[27] People also tend to care more about procedural justice procedural justice in situations in which they do not get the outcome they feel they deserve.[28] If you did not get the promotion and later discovered that management chose another candidate The degree to which fair decision-making because her father was in the city council, how would you feel? This may be viewed as adding insult procedures are used to to injury. When people do not get the rewards they want, they tend to hold management responsiarrive at a decision. ble if procedures are not fair.[29] Why do employees care about procedural justice? There are three potential reasons.[30] First, people tend to believe that fairness is an end in itself and it is the right thing to do. Second, fair processes guarantee future rewards. If the selection system is biased, you have no control over the process, and there is no guarantee that you will get future promotions. If the procedures are fair, you are more likely to believe that things will work out in the future. Third, fairness communicates that the organization values its employees and cares about their well-being. Research has identified many ways of achieving procedural justice. For example, giving employees advance notice before laying them off, firing them, or disciplining them is perceived as fair.[31] Advance notice helps employees get ready for the changes facing them or gives them an opportunity to change their behavior before it is too late. Allowing employees voice in decision making is also important.[32] When designing a performance-appraisal system or implementing a reorganization, it may be a good idea to ask people for their input because it increases perceptions of fairness. Even when it is not possible to have employees participate, providing explanations to employees is helpful in fostering procedural justice.[33] Finally, people expect consistency in treatment.[34] If one person is given extra time when taking a test while another is not, individuals would perceive decision making as unfair. interactional justice The degree to which people are treated with respect, kindness, and dignity in interpersonal interactions. Now let’s imagine your boss telling you that you are getting a promotion. Your manager’s exact words were, “Yes, we are giving you the promotion. The job is so simple that we thought even you can handle it.” Now what is your reaction? The feeling of unfairness you may now feel is explained by interactional justice. Interactional justice refers to the degree to which people are treated with respect, kindness, and dignity in interpersonal interactions. We expect to be treated with dignity by our peers, supervisors, and customers. When the opposite happens, we feel angry. Even when faced with negative outcomes such as a pay cut, being treated with dignity and respect serves as a buffer and alleviates our stress.[35] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work OB Toolbox: Be a Fair Person! Shutterstock.com • When distributing rewards, make sure you pay attention to different contribution levels of employees. Treating everyone equally could be unfair if they participated and contributed at different levels. People who are more qualified, skilled, or those who did more than others expect to receive a greater share of rewards. • Sometimes you may have to disregard people’s contributions to distribute certain rewards. Some rewards or privileges may be better distributed equally (e.g., health insurance) or based on the particular employee’s needs (such as unpaid leave for health reasons). • Pay attention to how you make decisions. Before making a decision, ask people to give you their opinions if possible. Explain your decisions to people who are affected by it. Before implementing a change, give people advance notice. Enforce rules consistently among employees. • Pay attention to how you talk to people. Treat others the way you want to be treated. Be kind, courteous, and considerate of their feelings. • Remember that justice is in the eye of the beholder. Even when you feel you are being fair, others may not feel the same way, and it is their perception that counts. Therefore, pay attention to being perceived as fair. • People do not care only about their own justice level. They pay attention to how others are treated as well. Therefore, in addition to paying attention to how specific employees feel, creating a sense of justice in the entire organization is important.[36] Employers would benefit from paying attention to all three types of justice perceptions. In addition to being the right thing to do, paying attention to justice perceptions leads to outcomes companies care about. Injustice is directly harmful to employees’ psychological health and wellbeing and contributes to stress and depression.[37] High levels of justice create higher levels of employee commitment to organizations, and they are related to higher job performance, higher levels of organizational citizenship (behaviors that are not part of one’s job description but help the organization in other ways, such as speaking positively about the company and helping others), and higher levels of customer satisfaction. Conversely, low levels of justice lead to retaliation and support of unionization.[38] Expectancy Theory Expectancy theory argues that individual motivation to put forth more or less effort is determined by a rational calculation in which individuals evaluate their situation.[39] According to this theory, individuals ask themselves three questions. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 151 152 Organizational Behavior FIGURE 5.5 Summary of Expectancy Theory Sources: Based on Porter, L. W., & Lawler, E. E. (1968). Managerial attitudes and performance. Homewood, IL: Irwin; Vroom, V. H. (1964). Work and motivation. New York: Wiley. expectancy Whether the person believes that high levels of effort will lead to outcomes of interest such as performance or success. instrumentality The degree to which the person believes that performance is related to secondary outcomes such as rewards. valence The value of the rewards awaiting the person as a result of performance. The first question is whether the person believes that high levels of effort will lead to outcomes of interest, such as performance or success. This perception is labeled expectancy. For example, do you believe that the effort you put forth in a class is related to performing well in that class? If you do, you are more likely to put forth effort. The second question is the degree to which the person believes that performance is related to subsequent outcomes, such as rewards. This perception is labeled instrumentality. For example, do you believe that getting a good grade in the class is related to rewards such as getting a better job, or gaining approval from your instructor, or from your friends or parents? If you do, you are more likely to put forth effort. Finally, individuals are also concerned about the value of the rewards awaiting them as a result of performance. The anticipated satisfaction that will result from an outcome is labeled valence. For example, do you value getting a better job, or gaining approval from your instructor, friends, or parents? If these outcomes are desirable to you, your expectancy and instrumentality is high, and you are more likely to put forth effort. Expectancy theory is a well-accepted theory that has received a lot of research attention.[40] It is simple and intuitive. Consider the following example. Let’s assume that you are working in the concession stand of a movie theater. You have been selling an average of 100 combos of popcorn and soft drinks a day. Now your manager asks you to increase this number to 300 combos a day. Would you be motivated to try to increase your numbers? Here is what you may be thinking: • Expectancy: Can I do it? If I try harder, can I really achieve this number? Is there a link between how hard I try and whether I reach this goal or not? If you feel that you can achieve this number if you try, you have high expectancy. • Instrumentality: What is in it for me? What is going to happen if I reach 300? What are the outcomes that will follow? Are they going to give me a pay raise? Am I going to be named the salesperson of the month? Am I going to receive verbal praise from my manager? If you believe that performing well is related to certain outcomes, instrumentality is high. • Valence: How do I feel about the outcomes in question? Do I feel that a 2% pay raise is desirable? Do I find being named the salesperson of the month attractive? Do I think that being praised by my manager is desirable? If your answers are yes, valence is positive. In contrast, if you find the outcomes undesirable (you definitely do not want to be named the salesperson of the month because your friends would make fun of you), valence is negative. If your answers to all three questions are affirmative—you feel that you can do it, you will get an outcome if you do it, and you value the reward—you are more likely to be motivated to put forth more effort toward selling more combos. As a manager, how can you motivate employees? In fact, managers can influence all three perceptions.[41] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work 153 Influencing Expectancy Perceptions Employees may not believe that their effort leads to high performance for a multitude of reasons. First, they may not have the skills, knowledge, or abilities to successfully perform their jobs. The answer to this problem may be training employees or hiring people who are qualified for the jobs in question. Second, low levels of expectancy may be because employees may feel that something other than effort predicts performance, such as political behaviors on the part of employees. If employees believe that the work environment is not conducive to performing well (resources are lacking or roles are unclear), expectancy will also suffer. Therefore, clearing the path to performance and creating an environment in which employees do not feel restricted will be helpful. Finally, some employees may perceive little connection between their effort and performance level because they have an external locus of control, low self-esteem, or other personality traits that condition them to believe that their effort will not make a difference. In such cases, providing positive feedback and encouragement may help motivate employees. Influencing Instrumentality Perceptions Showing employees that their performance is rewarded is going to increase instrumentality perceptions. Therefore, the first step in influencing instrumentality is to connect pay and other rewards to performance using bonuses, award systems, and merit pay. However, this is not always sufficient, because employees may not be aware of some of the rewards awaiting high performers. Publicizing any contests or award programs is needed to bring rewards to the awareness of employees. It is also important to highlight that performance, and not something else, is being rewarded. For example, if a company has an employee of the month award that is rotated among employees, employees are unlikely to believe that performance is being rewarded. This type of meritless reward system may actually hamper the motivation of the highest performing employees by eroding instrumentality. Influencing Valence Employees are more likely to be motivated if they find the reward to be attractive. This process involves managers finding what their employees value. Desirable rewards tend to be fair and satisfy different employees’ diverging needs. Ensuring high valence involves getting to know a company’s employees. Talking to employees and surveying them about what rewards they find valuable are some methods to gain understanding. Finally, giving employees a choice between multiple rewards may be a good idea to increase valence. TABLE 5.3 Ways in Which Managers Can Influence Expectancy, Instrumentality, and Valence Expectancy Instrumentality Valence Make sure employees have proper skills, abilities, and knowledge Reward employee performance Find rewards that are desirable to employees Ensure that the environment facilitates performance Inform people in advance about the rewards Make sure that the rewards are reviewed as fair Provide encouragement to make people believe that their effort makes a difference Try to eliminate non-performance influence over rewards Give employees choice over rewards © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 154 Organizational Behavior Reinforcement Theory Reinforcement theory is based on the work of Ivan Pavlov on behavioral conditioning and the later work of B. F. Skinner on operant conditioning.[42] According to reinforcement theory, behavior is a function of its outcomes. Imagine that even though no one asked you to, you stayed late and drafted a report. When the manager found out, she was ecstatic and took you out to lunch and thanked you genuinely. The consequences following your good deed were favorable, and therefore you are more likely to demonstrate similar behaviors in the future. In other words, your taking initiative was reinforced. Instead, if your manager had said nothing about it and everyone ignored the sacrifice you made, you would be less likely to demonstrate similar behaviors in the future. Reinforcement theory is based on a simple idea that may be viewed as common sense. Beginning at infancy we learn through reinforcement. If you have observed a small child discovering the environment, you will see reinforcement theory in action. When the child discovers manipulating a faucet leads to water coming out and finds this outcome pleasant, he is more likely to repeat the behavior. If he burns his hand while playing with hot water, the child is likely to stay away from the faucet in the future. Despite the simplicity of reinforcement, how many times have you seen positive behavior ignored, or worse, negative behavior rewarded? In many organizations, this is a familiar scenario. People go above and beyond the call of duty, yet their actions are ignored or criticized. People with disruptive habits may receive no punishments because the manager is afraid of the reaction the person will give when confronted. Problem employees may even receive rewards such as promotions so they will be transferred to a different location and become someone else’s problem. Moreover, it is common for people to be rewarded for the wrong kind of behavior. Steven Kerr has labeled this phenomenon “the folly of rewarding A while hoping for B.”[43] For example, a company may make public statements about the importance of quality. Yet if they choose to reward shipments on time regardless of the amount of defects contained in the shipments, employees are more likely to ignore quality and focus on hurrying the delivery process. Because people learn to repeat their behaviors based on the consequences following their prior activities, managers will need to systematically examine the consequences of employee behavior and make interventions when needed. Reinforcement Interventions Reinforcement theory describes four interventions to modify employee behavior. Two of these are methods of increasing the frequency of desired behaviors, while the remaining two are methods of reducing the frequency of undesired behaviors. TABLE 5.4 Reinforcement Methods Positive Reinforcement Negative Reinforcement Positive behavior followed by positive consequences (Manager praises the employee) Positive behavior followed by removal of negative consequences (Manager stops nagging the employee) Punishment Extinction Negative behavior followed by negative consequences (Manager demotes the employee) Negative behavior followed by removal of positive consequences (Manager ignores the behavior) © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work Positive reinforcement is a method of increasing the desired behavior.[44] Positive reinforcement involves making sure that a desired behavior is met with positive consequences. For example, praising an employee for treating a customer respectfully is an example of positive reinforcement. If the praise immediately follows the positive behavior, the employee will see a link between the behavior and positive consequences and will be motivated to repeat similar behaviors. Negative reinforcement is also used to increase the desired behavior. Negative reinforcement involves removal of unpleasant outcomes once desired behavior is demonstrated. Nagging an employee to complete a report is an example of negative reinforcement. The negative stimulus in the environment will remain present until positive behavior is demonstrated. The problem with negative reinforcement is that the negative stimulus may lead to unexpected behaviors and may fail to stimulate the desired behavior. For example, the person may start avoiding the manager to avoid being nagged. 155 positive reinforcement Making sure that a desired behavior is met with positive consequences. negative reinforcement Removal of unpleasant outcomes once desired behavior is demonstrated. Extinction is used to decrease the frequency of negative behaviors. Extinction is the removal of rewards following negative behavior. Sometimes, negative behaviors are demonstrated because they are being inadvertently rewarded. For example, it has been shown that when people are rewarded for their unethical behaviors, they tend to demonstrate higher levels of unethical behaviors.[45] Thus, when the rewards following unwanted behaviors are removed, the frequency of future negative behaviors may be reduced. For example, if a friend is posting pictures of cute kittens on her Facebook account, liking or commenting on these pictures will make them keep coming. Completely ignoring such posts may reduce their frequency (assuming that you are interested in reducing the frequency of posts about kittens). extinction Punishment is another method of reducing the frequency of undesirable behaviors. Punishment involves presenting negative consequences following unwanted behaviors. Giving an employee a warning for consistently being late to work is an example of punishment. punishment The removal of rewards following negative behavior. Presenting negative consequences following unwanted behaviors. Reinforcement Schedules In addition to types of reinforcements, researchers have focused their attention on schedules of reinforcement as well.[46] Reinforcement is presented on a continuous schedule if reinforcers follow all instances of positive behavior with a reward. An example of a continuous schedule would be giving an employee a sales commission every time they makes a sale. In many instances, continuous schedules are impractical.[47] For example, it would be difficult to praise an employee every time he shows up to work on time. Fixed-interval schedules involve providing rewards after a specified amount of time. An example of this is giving end-of-the year bonuses. Fixed-ratio schedules involve providing rewards every nth time the right behavior is demonstrated. An example of this would be giving the employee a bonus for every tenth sale he makes. Variable ratio involves providing reinforcement in a random pattern, such as praising the employee occasionally when the person shows up on time. In the case of continuous schedules, behavioral change is more temporary. Once the reward is withdrawn, the person may stop performing the desired behavior. The most durable results occur under variable ratios, but there is also some evidence that continuous schedules produce higher performance than do variable schedules.[48] continuous schedule When reinforcers follow all instances of positive behavior. fixed-interval schedules Fixed-interval schedules involve providing rewards after a specified amount of time. fixed-ratio schedules Rewarding behavior after a set number of occurrences. variable ratio Providing the reinforcement in a random pattern. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 156 Organizational Behavior FIGURE 5.6 Reinforcement Schedules Source: Image courtesy of Bauer, T., Erdogan, B., and Short, J. (2019). Principles of Management . Irvington, NY: FlatWorld. Photos © Shutterstock © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work 157 OB Toolbox: Be Effective in Your Use of Discipline Shutterstock.com As a manager, sometimes you will have to discipline an employee to eliminate unwanted behavior. Here are some tips to make this process more effective.[49] • Consider whether punishment is the most effective way to modify behavior. Sometimes catching people in the act of doing good things and praising or rewarding them is preferable to punishing negative behavior. Instead of criticizing them for being late, consider praising them when they are on time. Carrots may be more effective than sticks. You can also make the behavior extinct by removing any rewards that follow undesirable behavior. • Be sure that the punishment fits the crime. If a punishment is too harsh, both the employee in question and coworkers who will learn about the punishment will feel it is unfair. Unfair punishment may not change unwanted behavior. • Be consistent in your treatment of employees. Have disciplinary procedures and apply them in the same way to everyone. It is unfair to enforce a rule for one particular employee but then give others a free pass. • Document the behavior in question. If an employee is going to be disciplined, the evidence must go beyond hearsay. • Be timely with discipline. When a long period of time passes between behavior and punishment, it is less effective in reducing undesired behavior because the connection between the behavior and punishment is weaker. A systematic way in which reinforcement theory principles are applied is called Organizational Behavior Modification (or OB Mod).[50] This is a systematic application of reinforcement theory to modify employee behaviors in the workplace. The model consists of five stages. The process starts with identifying the behavior that will be modified. Let’s assume that we are interested in reducing absenteeism among employees. In step 2, we need to measure the baseline level of absenteeism. How many times a month is a particular employee absent? In step 3, the behavior’s antecedents and consequences are determined. Why is this employee absent? More importantly, what is happening when the employee is absent? If the behavior is being unintentionally rewarded (e.g., the person is still getting paid or is able to avoid unpleasant assignments because someone else is doing them), we may expect these positive consequences to reinforce the absenteeism. Instead, to reduce the frequency of absenteeism, it will be necessary to think of financial or social incentives to follow positive behavior and negative consequences to follow negative behavior. In step 4, an intervention is implemented. Removing the positive consequences of negative behavior may be an effective way of dealing with the situation, or, in persistent situations, punishments may be used. Finally, in step 5, the behavior is measured periodically and maintained. Studies examining the effectiveness of OB Mod have been supportive of the model in general. A review of the literature found that OB Mod interventions resulted in 17% improvement in performance.[51] Particularly in manufacturing settings, OB Mod was an effective way of increasing performance, although positive effects were observed in service organizations as well. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. OB Mod A systematic application of reinforcement theory to modify employee behaviors in the workplace. 158 Organizational Behavior FIGURE 5.7 Stages of Organizational Behavior Modification Source: Based on information presented in Stajkovic, A. D., & Luthans, F. (1997). A meta-analysis of the effects of organizational behavior modification on task performance, 1975–1995. Academy of Management Journal, 40, 1122–1149. Key Takeaway Process-based theories use the mental processes of employees as the key to understanding employee motivation. According to equity theory, employees are demotivated when they view reward distribution as unfair. Perceptions of fairness are shaped by the comparisons they make between their inputs and outcomes with respect to a referent’s inputs and outcomes. Following equity theory, research identified two other types of fairness (procedural and interactional) that also affect worker reactions and motivation. According to expectancy theory, employees are motivated when they believe that their effort will lead to high performance (expectancy), when they believe that their performance will lead to outcomes (instrumentality), and when they find the outcomes following performance to be desirable (valence). Reinforcement theory argues that behavior is a function of its consequences. By properly tying rewards to positive behaviors, eliminating rewards following negative behaviors, and punishing negative behaviors, leaders can increase the frequency of desired behaviors. These three theories are particularly useful in designing reward systems within a company. What do you think? 1. Your manager tells you that the best way of ensuring fairness in reward distribution is to keep the pay a secret. How would you respond to this assertion? 2. When distributing bonuses or pay, how would you ensure perceptions of fairness? 3. What are the differences between procedural, interactional, and distributive justice? List ways in which you could increase each of these justice perceptions. 4. Using examples, explain the concepts of expectancy, instrumentality, and valence. 5. Some practitioners and researchers consider OB Mod unethical because it may be viewed as a way of manipulation. What would be your reaction to such a criticism? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work 159 5.5 Focus on Motivation, Ethics, Technology, and National Culture Learning Objectives 1. Consider the role of motivation for ethical behavior. 2. Consider the relationship between technology and motivation. 3. Consider the role of national culture on motivation theories. Motivation and Ethics What motivates individuals to behave unethically? Motivation theories have been applied to explain this interesting and important question. For example, employees may engage in unethical behaviors to satisfy particular needs. Research has shown that those who have high need for affiliation and are at risk of being excluded are more likely to engage in unethical behavior that benefits their group. In other words, the desire to fit in and belong may motivate employees to engage in unethical actions as a way to gain status and belonging in a group. [52] One theory that has been particularly successful in explaining ethical behavior is reinforcement theory. Just like any other behavior such as performance or cooperation, ethical behavior is one that is learned as a result of the consequences following one’s actions. For example, in an experiment simulating the job of a sales manager, participants made a series of decisions using a computer. Partway through the simulation, subjects were informed that salespeople reporting to them were giving kickbacks to customers. Subjects in this experiment were more likely to cut the kickbacks if there was a threat of punishment to the manager. On the other hand, subjects playing the sales manager were more likely to continue giving away the kickbacks if they made a profit after providing the kickbacks.[53] In a separate study highlighting the importance of rewards and punishments, researchers found that the severity of expected punishment was the primary predictor of whether subjects reported inclination to behave unethically. In addition to the severity of the punishment, the perceived likelihood of punishment was also a major influence of ethical behavior.[54] These findings highlight the importance of rewards and punishments for motivating unethical behaviors. There are many organizational situations in which individuals may do unethical things but then experience positive consequences such as being awarded promotions for meeting their sales quotas. For example, in many hotels, staff members routinely receive kickbacks from restaurants or bars if they refer customers to those locations.[55] Similarly, sales staff rewarded with spiffs (productspecific sales incentives) may give customers advice that goes against their own personal beliefs and in this sense act unethically.[56] As long as unethical behavior is followed by positive consequences for the person in question, we would expect unethical behavior to continue. Thus, in order to minimize the occurrence of unethical behavior (and in some instances legal problems), it seems important to examine the rewards and punishments that follow unethical behavior and remove rewards following unethical behavior while increasing the severity and likelihood of punishment. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Shutterstock.com 160 Organizational Behavior Motivation and Technology Shutterstock.com Unfairness is a key demotivator. When organizations incorporate technology in their decision making and use algorithms to replace human decision making, they may believe that they are combating biases inherent in humans. However, any use of technology has the potential to result in unfairness. Algorithms learn to make decisions the way we teach them, or the way they learn from past decisions. Therefore, understanding what an algorithm is doing is essential in ethical use of technology in the workplace. Consider the following example: In the UK, students take an A-level exam which determines where they can enroll for college. As a result, these exams are some of the most consequential experiences in determining students’ future careers. When the COVID-19 pandemic prevented the Office of Qualifications and Exam Regulation (Ofqual) from offering the exam in 2020, Ofqual asked teachers to predict their students’ exam performance. However, because teacher estimates are likely to be inflated, they used an algorithm that adjusts these estimates based on students’ ranking in their own schools, and the school’s historical performance. While seeming scientific, there were deep problems with this approach. The algorithm had assumed that if a school had performed poorly in the past, it could not have improved since then, penalizing students from these schools. In contrast, the algorithm only reduced the scores of students in large cohorts, leaving the scores of students in private schools unchanged, and giving them an additional advantage. The results were denounced as unfair, resulted in an uproar and protests. Ultimately, the decision to use the algorithm was reversed. This is a vivid example of how automated decision making, while efficient, has a long way to go, and it is essential to consider its implications for creating systemic unfairness.[57] On the positive side, organizations are using technology and principles of gaming to motivate their employees to perform at a higher level, or expand their skills. For example, PricewaterCoopers uses an app-based game to teach interns digital skills. The game is interactive and can have teams compete with each other for cash prizes. Principles of gamification such as competition, immediate feedback, and having concrete goals to strive toward can be brought to life through technology, and has the potential to support teamwork, increase workplace engagement, and introduce an element of fun into the workplace. [58] Motivation Around the Globe Motivation is a culturally bound topic. In other words, the factors that motivate employees in different cultures may not be equivalent. The motivation theories we cover in this chapter are likely to be culturally bound because they were developed by Western researchers and the majority of the research supporting each theory was conducted on Western subjects. Shutterstock.com Based on the cultural context, Maslow’s hierarchy of needs may require modification because the ranking of the needs may differ across cultures. For example, a study conducted in thirty-nine countries showed that financial satisfaction was a stronger predictor of overall life satisfaction in developing nations compared to industrialized nations. In industrialized nations, satisfaction with esteem needs was a more powerful motivator than it was in developing nations.[59] Culture seems to play a role in the development of the need for achievement, affiliation, and power. A study comparing motivational profiles of managers in twenty-four countries showed that countries that are high in performance orientation (such as the United States and Canada) had managers higher in need for achievement, whereas countries high in humane orientation (such as Thailand and Philippines) had higher need for affiliation, and countries high in power distance (such as Asian and Middle Eastern cultures) displayed higher levels of need for power.[60] People around the world value justice and fairness. However, what is perceived as fair may be culturally dependent. Moreover, people in different cultures may react differently to perceived © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work unfairness.[61] For example, meta-analytic results show that the positive effects of justice perceptions are strongest in individualistic, feminine, high uncertainty avoidant, and low power distance cultures.[62] Key Takeaway Motivation theories are particularly useful for understanding why employees behave unethically. Based on reinforcement theory, people will demonstrate higher unethical behaviors if their unethical behaviors are followed by rewards or go unpunished. Similarly, according to expectancy theory, if people believe that their unethical actions will be rewarded with desirable outcomes, they are more likely to demonstrate unethical behaviors. Technology has the potential to make work more fun, but also introduce systemic unfairness into the workplace. In terms of culture, some of the motivation theories are likely to be culture bound, whereas others may more readily apply to other cultures. Existing research shows that what is viewed as fair or unfair tends to be culturally defined. What do you think? 1. What is the connection between a company’s reward system and the level of ethical behaviors? 2. Three important trends in technology involve the increasing use of automation, algorithms, and gamification in the workplace. How different are the implications of these trends for employee motivation? 3. Which of the motivation theories do you think would be more applicable to many different cultures? 5.6 Creating Happiness via Motivation: The Case of The Walt Disney Company s_bukley/Shutterstock.com The Walt Disney Company is an international entertainment and media conglomerate with business units in media networks, parks and resorts, studio entertainment, consumer products, and interactive media. Disney is renowned for creating a positive customer experience due, in large © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 161 162 Organizational Behavior part, to the passion and motivation of their staff, also known as “cast members,” in their theme parks and resorts. Disney attributes its employees’ high level of engagement to a unifying mission: “We create happiness.” This simple yet ambitious vision rests on a philosophy that happy employees will lead to happy customers. Disney has a robust employee reward and recognition program, which can be traced back to the company’s founder, Walt Disney. During the early years of the Walt Disney Company, a team of seven people was tasked with increasing revenues at Disneyland to fund its movie ventures. The team came up with innovative ideas such as a “Magic Kingdom Club” and “Grad Nites,” which attracted customers outside standard hours and enticed them to spend more time at the park. Walt Disney was so pleased with the team’s performance that he surprised each member with 100 shares of Disney stock, $50,000 in cash, and a Ferrari, all personally delivered by Mickey Mouse. Today, Disney’s recognition and rewards programs aim to create a supportive environment for all staff members. New employees are asked how they would most like to be rewarded, and this is taken into account for each employee. Rewards range from additional time off to movie tickets, and recognition initiatives include the stenciling of employee names on storefront windows in Disney theme parks. Disney also prides itself in taking employee feedback into consideration in business operations. For example, when the Hong Kong Disneyland resort first opened, cast members were required to pick up their costumes from attendants before starting their shifts. Thousands of employees started their shifts at the same time, which led to chaos and delays. In response to employee feedback about this, Disney installed self-serve checkout kiosks to facilitate the process. These kiosks have since been adopted at all Disney theme parks and cruise ships, leading to improved efficiency and happier employees. By listening to its employees, hiring friendly people, rewarding creativity, and recognizing missionaligned behavior, Disney cultivates an engaged, motivated workforce. This, in turn, leads to a high level of customer satisfaction and happiness creation.[63] Multimedia Extension—Disney Institute, On Learning, Creating a Culture of Care View in the online reader Case Discussion Questions 1. Why do you think the Walt Disney Company uses the term “cast members” for its employees? 2. Do you think there is a relationship between employee motivation and customer experience? Why or why not? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work 3. Can you think of strategic reasons for Disney to ensure a consistently positive customer experience through employee engagement? 4. If you were a manager at Disney, what else might you do to “create happiness” for your employees? 5. Disney firmly believes in rewarding and recognizing its employees. If you were an employee at Disney, what types of rewards/recognition would motivate you the most? 5.7 Conclusion In this chapter we have reviewed the basic motivation theories that have been developed to explain motivated behavior. Several theories view motivated behavior as attempts to satisfy needs. Based on this approach, managers would benefit from understanding what people need so that the actions of employees can be understood and managed. Other theories explain motivated behavior using the cognitive processes of employees. Employees respond to unfairness in their environment, they learn from the consequences of their actions and repeat the behaviors that lead to positive results, and they are motivated to exert effort if they see their actions will lead to outcomes that would get them desired rewards. None of these theories are complete on their own, but each theory provides us with a framework we can use to analyze, interpret, and manage employee behaviors in the workplace. 5.8 Exercises Ethical Dilemma Companies are interested in motivating employees: Work hard, be productive, behave ethically—and stay healthy. Health care costs are rising, and employers are finding that unhealthy habits such as smoking or being overweight are costing companies big bucks. Your company is concerned about the rising health-care costs and decides to motivate employees to adopt healthy habits. Therefore, employees are given a year to quit smoking. If they do not quit by then, they are going to lose their jobs. New employees will be given nicotine tests, and the company will avoid hiring new smokers in the future. The company also wants to encourage employees to stay healthy. For this purpose, employees will get cash incentives for weight loss. If they do not meet the weight, cholesterol, and blood pressure standards to be issued by the company, they will be charged extra fees for health insurance. Is this plan ethical? Why or why not? Can you think of alternative ways to motivate employees to adopt healthy habits? Individual Exercise Your company provides diversity training programs to ensure that employees realize the importance of working with a diverse workforce, are aware of the equal employment opportunity legislation, and are capable of addressing the challenges of working in a multicultural workforce. Participation in these programs is mandatory, and employees are required to take the training © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 163 164 Organizational Behavior as many times as needed until they pass. The training program lasts one day and is usually conducted in a nice hotel outside the workplace. Employees are paid for the time they spend in the training program. You realize that employees are not really motivated to perform well in this program. During the training, they put in the minimum level of effort, and most participants fail the exam given at the conclusion of the training program and then have to retake the training. Using expectancy and reinforcement theories, explain why they may not be motivated to perform well in the training program. Then suggest improvements in the program so that employees are motivated to understand the material, pass the exam, and apply the material in the workplace. Group Exercise A Reward Allocation Decision You are in charge of allocating a $12,000 bonus to a team that recently met an important deadline. The team was in charge of designing a Web-based product for a client. The project lasted a year. There were five people on the team. Your job is to determine each person’s share from the bonus. Devin: Project manager. He was instrumental in securing the client, coordinating everyone’s effort, and managing relationships with the client. He put in a lot of extra hours for this project. His annual salary is $80,000. He is independently wealthy, drives an expensive car, and does not have any debt. He has worked for the company for five years and worked on the project from the beginning. Alice: Technical lead. She oversaw the technical aspects of the project. She resolved many important technical issues. During the project, while some members worked extra hours, she refused to stay at the office outside regular hours. However, she was productive during regular work hours, and she was accessible via email in the evenings. Her salary is $50,000. She is a single mother and has a lot of debt. She has worked for the company for four years and worked on the project for eight months. Alia: Graphic designer. She was in charge of the creative aspects of the project. She experimented with many looks, and while doing that she slowed down the entire team. Enrique and Kira were mad at her because of the many mistakes she made during the project, but the look and feel of the project eventually appealed to the client, which resulted in repeat business. Her salary is $30,000. She is single and lives to party. She has worked for the company for two years and worked on this project from the beginning. Enrique: Tester. He was in charge of finding the bugs in the project and ensuring that it worked. He found many bugs, but he was not very aggressive in his testing. He misunderstood many things, and many of the bugs he found were not really bugs but his misuse of the system. He had a negative attitude toward the whole project, acted very pessimistically regarding the likelihood of success, and demoralized the team. His salary is $40,000. He has accumulated a large credit card debt. He has worked for the company for three years and worked on the project for the last six months. Kira: Web developer. She was in charge of writing the code. She was frustrated when Alia slowed down the entire project because of her experimentation. Kira was primarily responsible for meeting the project deadline because she put in a lot of extra work hours. Her salary is $50,000. Her mother has ongoing health issues, and Kira needs money to help her. She had worked for the company for the past year and was involved in this project for six months. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 5 Theories of Motivation at Work Endnotes 1. Case written by Rachel Mattenberger, Talya Bauer, and Berrin Erdogan to accompany Bauer, T.N. & Erdogan, B. (2021). Organizational Behavior: Bridging Science and Practice (4.0). Boston, MA: FlatWorld. Partially based on ideas and information contained in Welch, L. (2013). 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An integrative framework for explaining reactions to decisions: Interactive effects of outcomes and procedures. Psychological Bulletin, 120, 189–208. 29. Brockner, J., Fishman, A. Y., Reb, J., Goldman, B., Spiegel, S., & Garden, C. (2007). Procedural fairness, outcome favorability, and judgments of an authority’s responsibility. Journal of Applied Psychology, 92, 1657–1671. 30. Cropanzano, R., Bowen, D. E., & Gilliland, S. W. (2007). The management of organizational justice. Academy of Management Perspectives, 21, 34–48; Tyler, T. R. (1994). Psychological models of the justice motive: Antecedents of distributive and procedural justice. Journal of Personality and Social Psychology, 67, 850–863; Tyler, T., Degoey, P., & Smith, H. (1996). Understanding why the justice of group procedures matters: A test of the psychological dynamics of the group-value model. Journal of Personality and Social Psychology, 70, 913–930. 31. Kidwell, R. E. (1995). Pink slips without tears. Academy of Management Executive, 9, 69–70. 32. Alge, B. J. (2001). Effects of computer surveillance on perceptions of privacy and procedural justice. Journal of Applied Psychology, 86, 797–804; Kernan, M. C., & Hanges, P. J. (2002). Survivor reactions to reorganization: Antecedents and consequences of procedural, interpersonal, and informational justice. Journal of Applied Psychology, 87, 916–928; Lind, E. A., Kanfer, R., & Earley, C. P. (1990). Voice, control, and procedural justice: Instrumental and noninstrumental concerns in fairness judgments. Journal of Personality and Social Psychology, 59, 952–959. 33. Schaubroeck, J., May, D. R., & William, B. F. (1994). Procedural justice explanations and employee reactions to economic hardship: A field experiment. Journal of Applied Psychology, 79, 455–460. 34. Bauer, T. N., Maertz, C. P., Jr., Dolen, M. R., & Campion, M. A. (1998). Longitudinal assessment of applicant reactions to employment testing and test outcome feedback. Journal of Applied Psychology, 83, 892–903. 35. Greenberg, J. (2006). Losing sleep over organizational injustice: Attenuating insomniac reactions to underpayment inequity with supervisory training in interactional justice. Journal of Applied Psychology, 91, 58–69. 36. Sources: Adapted from ideas in Colquitt, J. A. (2004). Does the justice of the one interact with the justice of the many? Reactions to procedural justice in teams. Journal of Applied Psychology, 89, 633–646; Cropanzano, R., Bowen, D. E., & Gilliland, S. W. (2007). The management of organizational justice. Academy of Management Perspectives, 21, 34–48. 37. Inoue, A., Kawakami, N., Tsuno, K., Tomioka, K., & Nakanishi, M. (2013). Organizational justice and major depressive episodes in Japanese employees: A cross-sectional study. Journal of Occupational Health, 55, 47-55; Tepper, B. J. (2001). Health consequences of organizational injustice: Tests of main and interactive effects. Organizational Behavior and Human Decision Processes, 86, 197–215. 38. Blader, S. L. (2007). What leads organizational members to collectivize? Injustice and identification as precursors of union certification. Organization Science, 18, 108–126; Colquitt, J. A., Conlon, D. E., Wesson, M. J., Porter, C. O. L. H., & Ng, K. Y. (2001). Justice at the millennium: A metaanalytic review of 25 years of organizational justice research. Journal of Applied Psychology, 86, 425–445; Colquitt, J. A., Rodell, J. B. (2011). Justice, trust, and trustworthiness: A longitudinal analysis integrating three theoretical perspectives. Academy of Management Journal, 54, 1183–1206; Rubenstein, A. L., Allen, D. G., & Bosco, F. A. (In press). What’s past (and present) is prologue: Interactions between justice levels and trajectories predicting behavioral reciprocity. Journal of Management. Masterson, S. S. (2001). A trickle-down model of organizational justice: Relating employees’ and customers’ perceptions of and reactions to fairness. Journal of Applied Psychology, 86, 594–604. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 166 Organizational Behavior 39. Porter, L. W., & Lawler, E. E. (1968). Managerial attitudes and performance. Homewood, IL: Irwin; Vroom, V. H. (1964). Work and motivation. New York: Wiley. 40. Heneman, H. G., & Schwab, D. P. (1972). Evaluation of research on expectancy theory predictions of employee performance. Psychological Bulletin, 78, 1–9; Van Eerde, W., & Thierry, H. (1996). Vroom’s expectancy models and work-related criteria: A meta-analysis. Journal of Applied Psychology, 81, 575–586. 41. Cook, C. W. (1980). Guidelines for managing motivation. Business Horizons, 23, 61–69. 42. Skinner, B. F. (1953). Science and human behavior. New York: Free Press. 43. Kerr, S. (1995). On the folly of rewarding A while hoping for B. 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Estrada, S. (July 28, 2020). How PwC uses gamification to support learning, engagement. Retrieved from https://www.hrdive.com/news/howpwc-uses-gamification-to-support-learning-engagement/582440/ 59. Oishi, S., Diener, E. F., & Suh, E. M. (1999). Cross-cultural variations in predictors of life satisfaction: Perspectives from needs and values. Personality and Social Psychology Bulletin, 25, 980–990. 60. Van Emmerik, H., Gardner, W. L., Wendt, H., & Fischer, D. (2010). Associations of culture and personality with McClelland’s motives: A cross-cultural study of managers in 24 countries. Group & Organization Management, 35, 329-367. 61. Erdogan, B., & Liden, R. C. (2006). Collectivism as a moderator of responses to organizational justice: Implications for leader-member exchange and ingratiation. Journal of Organizational Behavior, 27, 1–17; Mueller, C. W., & Wynn, T. (2000). The degree to which justice is valued in the workplace. Social Justice Research, 13, 1–24. 62. Shao, R., Rupp, D. E., Skarlicki, D. P., & Jones, K. S. (2013). Employee justice across cultures: A meta-analytic review. Journal of Management, 39, 263-301. 63. Case written by Talya Bauer, Berrin Erdogan, and Rachel Mattenberger to accompany Bauer, T. N., & Erdogan, B. (2021). Organizational Behavior: Bridging Science and Practice (4.0). Boston, MA: FlatWorld. Partially based on ideas and information contained in Disney Training: The Magic of Disneyworld’s Way of Motivating Their People. (2002). Retrieved from https://www.chartcourse.com/hiring-top-performers; Bradt, G. (2015). Disney’s Best Ever Example of Motivating Employees. Forbes. Retrieved from https://www.forbes.com/sites/georgebradt/2015/05/20/ disneys-best-ever-example-of-motivating-employees/2/#77d8cc77182a; Jones, B. (2018). The Secret to Delighting Customers… Put Employees First. Retrieved from https://disneyinstitute.com/blog/2018/01/thesecret-to-delighting-customersput-employees-first; About the Walt Disney Company. Retrieved from https://thewaltdisneycompany.com/about. CHAPTER 6 Designing a Motivating Work Environment Shutterstock.com Learning Objectives After reading this chapter, you should be able to do the following: 1. Describe the history of job design approaches. 2. Understand how to increase the motivating potential of a job. 3. Understand why goals should be SMART. 4. Set SMART goals. 5. Give performance feedback effectively. 6. Describe individual-, team-, and organization-based incentives that can be used to motivate the workforce. 7. Understand connections between designing a motivating work environment and ethics, technology, and cross-cultural management. What are the tools companies can use to ensure a motivated workforce? In this chapter, we will cover the basic tools organizations can use to motivate workers. The tools that will be described are based on motivation principles such as expectancy theory, reinforcement theory, and need-based theories. Specifically, we cover motivating employees through job design, goal setting, performance feedback, and reward systems. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 168 Organizational Behavior 6.1 Performance with Purpose: The Case of PepsiCo monticello/Shutterstock.com Pepsi is a world-renowned food and beverage brand, and its manufacturer PepsiCo owns other well-known beverages such as Mountain Dew, Tropicana, and 7Up, as well as snacks such as Lay’s chips, Doritos, and Quaker. As any company, its future success depends on satisfying all stakeholders. Given the size of PepsiCo and the reach of its products, the stakeholders include every one of us. For example, the high salt, fat, and sugar content of some of PepsiCo offerings may jeopardize health of customers, including children. Many PepsiCo products come in disposable plastic packages that end up in landfills and oceans. The production of PepsiCo products demands huge amounts of energy, and increases greenhouse gases contributing to climate change. The beverage production requires large amounts of water, often in areas where water is a scarce and precious resource, and when PepsiCo uses it up, there is less available for everyone else. Anticipating that how PepsiCo reacts to these challenges would be the key to its future success, former CEO Indra Nooyi, along with key leaders in the business, set a strategy they termed Performance with Purpose (PwP) over a decade ago. Consisting of sustainability goals around financial returns, healthier products, limiting the environmental impact of the company, and supporting employees, the company aimed to make all its major decisions in the following decades with this strategy in mind. The next CEO, Ramon Laguarta, who took the helm in 2018 continues to adhere to this strategy, calling it “winning with purpose.” After defining and communicating the basics of PwP and setting company level targets for different metrics (such as “the company will reduce its absolute greenhouse gas emissions across its global value chain by 20% by 2030 against a 2015 baseline”) the company set PwP-related goals for senior executives, country heads, and middle-level managers. These metrics were used in performance reviews and tied to incentives. Further, the company tied resource allocations to its sustainability impact. Any time there was a major investment under consideration, the champion of the proposal would need to explain how the project would contribute to PWP goals and objectives. PwP had numerous, high impact and highly visible outcomes that were good for the company and for the stakeholders. For example, the company was able to reduce the fat, sugar, and salt content of many of its products and acquired healthy products to add to its line-up. PwP also drove behaviors that would be unthinkable without such a strategy. For example, a desire to produce Cheetos from whole grains and the lack of availability of machines that could be used for this purpose led the company to develop the production machinery that could handle whole grains in their own R&D center. PwP led to pulling the plug on an energy product that had the potential to be profitable but would mean selling a product, which contained high amounts of caffeine, that could be marketed to kids. It also led to its Mexican operations working with the Mexican government to support the farming of sunflowers to replace unhealthy palm oils. In 2020, the company announced plans to use 100% renewable electricity in its US operations, which rep- © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment resents almost 50% of its global operations. The company is moving toward renewable plastics in some products, and aluminum in others. The company supports recycling programs and beach clean up efforts, partnering with Ocean Conservancy to tackle plastic pollution in oceans.[1] Multimedia Extension—PepsiCo Chairman and CEO Indra Nooyi: Our Sustainability Journey View in the online reader Case Discussion Questions 1. How do you think PwP motivates employees at PepsiCo? 2. Explain the role of goals as a motivational tool. Are there mechanisms outside of goals and incentives that would make PwP motivate employees? 3. How is PwP different from greenwashing? Do you believe that it is a marketing tool, or a fundamental shift in how the business operates? 4. How would PwP be transferred to other industries? Would it be easier or more difficult to achieve it in a smaller company? 5. Would this be the type of company you would be interested in working for? Why or why not? 6.2 Motivating Employees Through Job Design Learning Objectives 1. Learn about the history of job design approaches. 2. Consider alternatives to job specialization. 3. Identify job characteristics that increase motivating potential. 4. Learn how to empower employees. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 169 170 Organizational Behavior Importance of Job Design Many of us assume the most important motivator at work is pay. Yet studies point to a different factor as the primary influence over worker motivation—job design. How a job is designed has a major impact on employee motivation, job satisfaction, commitment to an organization, absenteeism, and turnover. The question of how to properly design jobs so that employees are more productive and more satisfied has received attention from managers and researchers since the beginning of the twentieth century. We will review major approaches to job design starting from its early history. Scientific Management and Job Specialization Perhaps the earliest attempt to design jobs came during the era of scientific management. Scientific management is a philosophy based on the ideas of Frederick Taylor as presented in his 1911 book, Principles of Scientific Management. Taylor’s book is among the most influential books of the twentieth century; the ideas presented had a major influence over how work was organized in the following years. Taylor was a mechanical engineer in the manufacturing industry. He saw work being done haphazardly, with only workers in charge. He saw the inefficiencies inherent in employees’ production methods and argued that a manager’s job was to carefully plan the work to be performed by employees. He also believed that scientific methods could be used to increase productivity. As an example, Taylor found that instead of allowing workers to use their own shovels, as was the custom at the time, providing specially designed shovels increased productivity. Further, by providing training and specific instructions, he was able to dramatically reduce the number of laborers required to handle each job.[2] This Ford panel assembly line in Yelabuga, Russia, is an example of specialization. Each person on the line has a different job. vladimir salman/Shutterstock.com job specialization Breaking down tasks into their simplest components and assigning them to employees so that each person would perform few tasks in a repetitive manner. Scientific management proposed a number of ideas that have been influential in job design in the following years. An important idea was to minimize waste by identifying the most efficient method to perform the job. Using time-motion studies, management could determine how much time each task would require and plan the tasks so that the job could be performed as efficiently as possible. Therefore, standardized job performance methods were an important element of scientific management techniques. Each job would be carefully planned in advance, and employees would be paid to perform the tasks in the way specified by management. Furthermore, job specialization was one of the major advances of this approach. Job specialization entails breaking down jobs into their simplest components and assigning them to employees so that each person would perform a select number of tasks in a repetitive manner. There are a number of advantages to job specialization. Breaking tasks into simple components and making them repetitive reduces the skill requirements of the jobs and decreases the effort and cost of staffing. Training times for simple, repetitive jobs tend to be shorter as well. At the same time, from a motivational perspective, these jobs are boring and repetitive and therefore associated with negative outcomes such as absenteeism.[3] Also, job specialization resulted in employees behaving in ways that counteracted the benefits gained from job specialization, such as counterproductive work behaviors including tardiness.[4] Today, Taylorism has a bad reputation, and it is often referred to as the “dark ages” of management when employees’ social motives were ignored. Yet it is important to recognize the fundamental change in management mentality brought about by Taylor’s ideas. For the first time, managers realized their role in influencing the output levels of employees. The concept of scientific management has had a lasting impact on how work is organized. Taylor’s work paved the way for automation and standardization that is virtually universal in today’s workplace. Assembly lines where each worker performs simple tasks in a repetitive manner are a direct result of job specialization efforts. Job specialization eventually found its way to the service industry as well. One of © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment 171 the biggest innovations of the famous McDonald brothers’ first fast-food restaurant was the application of scientific management principles to their operations. They divided up the tasks so that one person took the orders while someone else made the burgers, another person applied the condiments, and yet another wrapped them. With this level of efficiency, customers generally received their orders within one minute.[5] Alternatives to Job Specialization: Rotation, Enlargement, Enrichment, and Job Crafting One of the early alternatives to job specialization was job rotation. Job rotation involves moving employees from job to job at regular intervals. When employees periodically move to different jobs, the monotonous aspects of job specialization can be relieved. For example, Maids International Inc., a company that provides cleaning services to households and businesses, utilizes job rotation so that maids cleaning the kitchen in one house would clean the bedroom in a different one.[6] Using this technique, among others, the company is able to reduce its turnover level. In a supermarket study, cashiers were rotated to work in different departments. As a result of the rotation, employees’ stress levels were reduced, as measured by their blood pressure. Moreover, they experienced less pain in their neck and shoulders.[7] job rotation Moving employees from job to job at regular intervals. Job rotation has many advantages for organizations. It is an effective way for employees to acquire new skills and in turn for organizations to increase the overall skill level of their employees.[8] When workers move to different positions, they are cross-trained to perform different tasks, thereby increasing the flexibility of managers to assign employees to different parts of the organization when needed. In addition, job rotation is a way to transfer knowledge between departments.[9] An interesting side effect of job rotation in some jobs is increased accountability and more ethical behavior. For example, loan officers tend to prepare more accurate and honest reports about their own performance when they anticipate rotation, presumably because they do not want their bad decisions to be exposed by their successor.[10] From the employee standpoint, rotation is a benefit, because they acquire new skills that keep them marketable in the long run. Is rotation used only at lower levels of an organization? Anecdotal evidence suggests that companies successfully rotate high-level employees to train managers and increase innovation in the company. For example, Marriott International uses strategic movement of management trainees within property (e.g., from banquet to sales) as well as among its more than 7,000 lodging properties in 131 countries to prepare them for future assignments.[11] Panasonic uses job rotation at global and regional levels in order to prepare employees for future leadership roles.[12] Job enlargement refers to expanding the tasks performed by employees to add more variety. By giving employees several different tasks to be performed, as opposed to limiting their activities to a small number of tasks, organizations hope to reduce boredom and monotony as well as utilize human resources more effectively. Job enlargement may have similar benefits to job rotation, because it may also involve teaching employees multiple tasks. Research indicates that when jobs are enlarged, employees view themselves as being capable of performing a broader set of tasks.[13] There is some evidence that job enlargement is beneficial because it is positively related to employee satisfaction and higher quality customer services, and it increases the chances of catching mistakes.[14] At the same time, the effects of job enlargement may depend on the type of enlargement. For example, job enlargement consisting of adding tasks that are very simple in nature had negative consequences on employee satisfaction with the job and resulted in fewer errors being caught. Alternatively, giving employees more tasks that require them to be knowledgeable in different areas seemed to have more positive effects.[15] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. job enlargement Expanding the tasks performed by employees to add more variety. 172 Organizational Behavior job enrichment A job redesign technique allowing workers more control over how they perform their own tasks. job crafting Proactive changes employees make in their own job descriptions. Job enrichment is a job redesign technique that allows workers more control over how they perform their own tasks. This approach allows employees to take on more responsibility over their jobs. As an alternative to job specialization, companies using job enrichment may experience positive outcomes, such as reduced turnover, increased productivity, and reduced absences.[16] This may be because employees who have the authority and responsibility over their work can be more efficient, eliminate unnecessary tasks, take shortcuts, and increase their overall performance. At the same time, there is evidence that job enrichment may sometimes cause dissatisfaction among certain employees.[17] The reason may be that employees who are given additional autonomy and responsibility may expect greater levels of pay or other types of compensation, and if this expectation is not met they may feel frustrated. One more thing to remember is that job enrichment is not suitable for everyone.[18] Not all employees desire to have control over how they work, and if they do not have this desire, they may become frustrated with an enriched job. A contemporary approach to job enrichment is job crafting. Job crafting refers to the changes employees make to their own job description—expanding certain elements that are a better fit to their own personality, or reducing the scope of the job to achieve better work-life balance, all in the service of better meeting the employee’s career and life goals. The idea behind job crafting is that oftentimes employees are not passive recipients of their roles and instead take an active role in shaping their own job roles and responsibilities to fit the realities of their interests, passions, and goals. Researchers identified three types of crafting: task crafting (changing the content of the job), relational crafting (changing the quality and amount of interactions involved with other people), and cognitive crafting (changing the way the person thinks about the job).[19] Further, job crafting may take the form of approach or avoidance crafting. Approach crafting involves making the job more motivating and taking a more improvement-focused approach to modifying the job, whereas avoidance crafting involves evading unpleasant aspects of the job. Not surprisingly, approach crafting shows a more positive relation with job engagement and performance, whereas avoidance crafting is related to work withdrawal.[20] Not all jobs allow crafting, but some organizations are increasingly encouraging employees to take on an active role in the shaping of job descriptions. As an example, Deloitte employees may renegotiate their roles with management to increase or decrease the scope and visibility of the projects they take on, or increase the flexibility of their work hours.[21] Job Characteristics Model job characteristics model Five core job dimensions, leading to three critical psychological states, which lead to work-related outcomes. The job characteristics model is one of the most influential attempts to design jobs with increased motivational properties.[22] Proposed by Hackman and Oldham, the model describes five core job dimensions leading to three critical psychological states, resulting in work-related outcomes. Even though jobs have changed since the model was proposed in the 1970s, the core job characteristics included in the model are still highly relevant for employee job attitudes. However, the changing nature of work affected how likely it is for an employee to encounter these characteristics at work. For example, research has shown that since the 1970s, jobs have increased in skill variety and autonomy.[23] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment 173 FIGURE 6.1 Job Characteristics Model The Job Characteristics Model has five core job dimensions known as core job characteristics. Source: Adapted from Hackman, J. R., & Oldham, G. R. (1975). Development of the job diagnostic survey. Journal of Applied Psychology, 60, 159–170. Skill variety refers to the extent to which the job requires a person to utilize multiple highlevel skills. A car-wash employee whose job consists of directing customers into the automated car wash demonstrates low levels of skill variety, whereas a car-wash employee who acts as a cashier, maintains car-wash equipment, and manages the inventory of chemicals demonstrates higher skill variety. Task identity refers to the degree to which a person is in charge of completing an identifiable piece of work from start to finish. For example, at Google, many employees are given ownership over projects, and they work on the project from beginning to end, leading to a sense of task identity.[24] Task significance refers to whether a person’s job substantially affects other people’s work, health, or well-being. A janitor who cleans the floors at an office building may find the job low in significance, thinking it is not a very important job. However, janitors cleaning the floors at a hospital may see their role as essential in helping patients get better. When employees feel that their tasks are significant, they perform at higher levels and engage in greater levels of citizenship behaviors. Further, employees who believe their tasks are highly significant are better able to cope with the daily stressors associated with their jobs, such as their daily commute.[25] skill variety The extent to which the job requires a person to utilize multiple high-level skills. task identity The degree to which a person is in charge of completing an identifiable piece of work from start to finish. task significance Whether a person’s job substantially affects other people’s work, health, or well-being. Autonomy is the degree to which a person has the freedom to decide how to perform his or her tasks. As an example, a restaurant chef working in a small restaurant who has control over the menu, concept, and pricing will have greater autonomy compared to a chef who is working in a chain restaurant who oversees the cooking process without having control over the taste of food, how it is cooked, or from where ingredients are acquired. Autonomy increases motivation at work, but it also has other benefits. Employees with autonomy can respond to workplace problems more quickly and effectively. Autonomy speeds the quality of decision making. Autonomous employees are also less likely to adopt a “this is not my job” approach to their work environment and instead be proactive (do what needs to be done without waiting to be told what to do) and creative.[26] Giving employees autonomy is also a great way to train them on the job. Gucci’s former CEO Robert Polet describes the autonomy he was given while working at Unilever PLC as a key to his development of leadership talents.[27] Autonomy can arise from workplace features, such as telecommuting, company structure, organizational climate, and leadership style.[28] autonomy Feedback refers to the degree to which people learn how effective they are being at work. Feedback at work may come from other people, such as supervisors, peers, subordinates, and customers, or it may come from the job itself. A salesperson who gives presentations to potential clients, but is not informed of the clients’ decisions, has low feedback at work. If this person receives notification that a sale was made based on the presentation, feedback will be high. feedback The relationship between feedback and job performance is more controversial. In other words, the mere presence of feedback is not sufficient for employees to feel motivated to perform better. In © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. The degree to which people have the freedom to decide how to perform their tasks. The degree to which people learn how effective they are being at work. 174 Organizational Behavior fact, a review of this literature shows that in about one-third of the cases, feedback was detrimental to performance.[29] In addition to whether feedback is present, the sign of feedback (positive or negative), whether the person is ready to receive the feedback, and the manner in which feedback is given will all determine whether employees feel motivated or demotivated as a result of feedback. According to the job characteristics model, the presence of these five core job dimensions leads employees to experience three psychological states: They view their work as meaningful, they feel responsible for the outcomes, and they acquire knowledge of results. These three psychological states in turn are related to positive outcomes such as overall job satisfaction, internal motivation, higher performance, and lower absenteeism and turnover.[30] In addition, firms where employees experience these five job characteristics have higher levels of collective organizational engagement, which leads to higher firm performance.[31] Research shows that out of these three psychological states, experienced meaningfulness is the most important for employee attitudes and behaviors, and it is the key mechanism through which the five core job dimensions operate. Unfortunately, a Gallup study revealed that only 13% of American workers find their work meaningful.[32] Are all five job characteristics equally valuable for employees? Hackman and Oldham’s model proposes that the five characteristics will not have uniform effects. Instead, they proposed the following formula to calculate the motivating potential score (MPS) of a given job:[33] MPS = [(Skill Variety + Task Identity + Task Significance) ÷ 3] × Autonomy × Feedback According to this formula, autonomy and feedback are the more important elements in deciding motivating potential compared to skill variety, task identity, or task significance. Moreover, note how the job characteristics interact with each other in this model. If someone’s job is lacking in autonomy (or feedback), regardless of levels of variety, identity, and significance, the motivating potential score will be very low. Note that the five job characteristics are not objective features of a job. Two employees working in the same job may have very different perceptions regarding how much skill variety, task identity, task significance, autonomy, or feedback the job affords. In other words, motivating potential is in the eye of the beholder. This is both good and bad news. The bad news is that even though a manager may design a job that is supposed to motivate employees, some employees may not find the job to be motivational. The good news is that sometimes it is possible to increase employee motivation by helping employees change their perspective about the job. For example, employees laying bricks at a construction site may feel their jobs are low in significance, but bringing them together with the owners of the home they are building may change their perceptions by helping them find meaning at work. growth need strength The degree to which a person has higher-order needs, such as self-esteem and self-actualization. Do all employees expect to have a job that has a high motivating potential? Research has shown that the desire for the five core job characteristics is not universal. One factor that affects how much of these characteristics people want or need is growth need strength. Growth need strength describes the degree to which a person has higher-order needs, such as self-esteem and self-actualization. When an employee’s expectation from his job includes such higher-order needs, employees will have high-growth need strength, whereas those who expect their job to pay the bills and satisfy more basic needs will have low-growth need strength. Not surprisingly, research shows that those with high-growth need strength respond more favorably to jobs with a high motivating potential.[34] It also seems that an employee’s career stage influences how important the five dimensions are. For example, when employees are new to an organization, task significance is a positive influence over job satisfaction, but autonomy may be a negative influence.[35] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment 175 OB Toolbox: Increase the Feedback You Receive—Seek It! Shutterstock.com • If you are not receiving enough feedback on the job, it is better to seek it instead of trying to guess how you are doing. Consider seeking regular feedback from your boss. This also has the added benefit of signaling to the manager that you care about your performance and want to be successful. • Be genuine in your desire to learn. When seeking feedback, your aim should be improving yourself as opposed to creating the impression that you are a motivated employee. If your manager thinks that you are "fishing for compliments" rather than genuinely trying to improve your performance, seeking feedback may hurt you. • Develop a good relationship with your manager. This has the benefit of giving you more feedback in the first place. It also has the upside of making it easier to ask direct questions about your own performance. • Consider finding trustworthy peers who can share information with you regarding your performance. Your manager is not the only helpful source of feedback. • Be gracious when you receive feedback. If you automatically go on the defensive the first time you receive negative feedback, there may not be a next time. Remember, even if receiving feedback, positive or negative, feels uncomfortable, it is a gift. You can improve your performance using feedback, and people giving negative feedback probably feel they are risking your good will by being honest. Be thankful and appreciative when you receive any feedback and do not try to convince the person that it is inaccurate (unless there are factual mistakes).[36] Empowerment One of the contemporary approaches to motivating employees through job design is empowerment. The concept of empowerment extends the idea of autonomy. Empowerment may be defined as the removal of conditions that make a person powerless.[37] The idea behind empowerment is that employees have the ability to make decisions and perform their jobs effectively if management removes certain barriers. Thus, instead of dictating roles, companies should create an environment where employees thrive, feel motivated, and have discretion to make decisions about the content and context of their jobs. Employees who feel empowered believe that their work is meaningful. They tend to feel that they are capable of performing their jobs effectively, have the ability to influence how the company operates, and can perform their jobs in any way they see fit, without close supervision and other interference. These liberties enable employees to feel powerful.[38] In cases of very high levels of empowerment, employees decide what tasks to perform and how to perform them, in a sense managing themselves. Research has distinguished between structural elements of empowerment and felt empowerment. Structural empowerment refers to the aspects of the work environment that give employees discretion, autonomy, and the ability to do their jobs effectively. The idea is that the presence of certain structural factors helps empower people, but in the end, empowerment is a perception. The following figure demonstrates the relationship between structural and felt empowerment. For example, at Harley-Davidson Motor Company, employees have the authority to stop the production line if they see a blemish on the product.[39] Leadership style is another influ- © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. empowerment The removal of conditions that make a person powerless. structural empowerment The aspects of the work environment that give employees discretion and autonomy, and enable them to do their jobs effectively. 176 Organizational Behavior ence over experienced empowerment.[40] If the manager is controlling, micromanaging, and bossy, chances are that empowerment will not be possible. A company’s structure has a role in determining empowerment as well. Factories organized around teams, such as the Saturn plant of General Motors Corporation, can still empower employees, despite the presence of a traditional hierarchy.[41] Access to information is often mentioned as a key factor in empowering employees. If employees are not given information to make an informed decision, empowerment attempts will fail. Therefore, the relationship between access to information and empowerment is well established. Finally, empowering individual employees cannot occur in a bubble, but instead depends on creating a climate of empowerment throughout the entire organization.[42] FIGURE 6.2 Empowerment Process The empowerment process starts with structure that leads to felt empowerment. Empowerment of employees tends to be beneficial for organizations because it is related to outcomes such as employee innovativeness, managerial effectiveness, employee commitment to the organization, customer satisfaction, job performance, and behaviors that benefit the company and other employees.[43] Employees are better able to cope with negative and unavoidable aspects of their work lives when they feel highly empowered.[44] At the same time, empowerment may not necessarily be suitable for all employees. Those individuals with low growth strength or low achievement need may not benefit as strongly from empowerment. Moreover, the idea of empowerment is not always easy to implement because some managers may feel threatened when subordinates are empowered. If employees do not feel ready for empowerment, they may also worry about the increased responsibility and accountability. Therefore, preparing employees for empowerment by carefully selecting and training them is important to the success of empowerment interventions. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment OB Toolbox: Tips for Empowering Employees Shutterstock.com • Change the company structure so that employees have more power in their jobs. If jobs are strongly controlled by organizational procedures or if every little decision needs to be approved by a superior, employees are unlikely to feel empowered. Give them discretion at work. • Provide employees with access to information about things that affect their work. When employees have the information they need to do their jobs well and understand company goals, priorities, and strategy, they are in a better position to feel empowered. • Make sure that employees know how to perform their jobs. This involves selecting the right people as well as investing in continued training and development. • Do not take away employee power. If someone makes a decision, let it stand unless it threatens the entire company. If management undoes decisions made by employees on a regular basis, employees will not believe in the sincerity of the empowerment initiative. • Instill a climate of empowerment in which managers do not routinely step in and take over. Instead, believe in the power of employees to make the most accurate decisions, as long as they are equipped with the relevant facts and resources. Key Takeaway Job specialization is the earliest approach to job design, originally described by the work of Frederick Taylor. Job specialization is efficient but leads to boredom and monotony. Early alternatives to job specialization include job rotation, job enlargement, and job enrichment. Recently, researchers also recognized the proactive role employees play in their own job design by job crafting. Research shows that there are five job components that increase the motivating potential of a job: skill variety, task identity, task significance, autonomy, and feedback. Finally, empowerment is a contemporary way of motivating employees through job design. These approaches increase worker motivation and have the potential to increase performance. What do you think? 1. Is job rotation primarily suitable to lower level employees, or is it possible to use it at higher levels in the organization? 2. What is the difference between job enlargement and job enrichment? Which of these approaches is more useful in dealing with the boredom and monotony of job specialization? 3. Consider a job you held in the past. Analyze the job using the framework of the job characteristics model. 4. Have you ever engaged in job crafting? If you have the opportunity, how would you craft your current or future job? 5. How would you increase the empowerment levels of employees? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 177 178 Organizational Behavior 6.3 Motivating Employees Through Goal Setting Learning Objectives 1. Describe why goal setting motivates employees. 2. Identify characteristics of a goal that make it effective. 3. Identify limitations of goals. 4. Understand how to tie individual goals to strategic goals. Goal-Setting Theory Goal-setting theory[45] is one of the most influential theories of motivation. In fact, in a survey of organizational behavior scholars, it has been rated as the most important (out of 73 theories).[46] The theory has been supported in over 1,000 studies with employees ranging from blue-collar workers to research-and-development employees, and there is strong support that setting goals is related to performance improvements.[47] According to one estimate, goal setting improves performance at least 10% and up to 25%.[48] Based on this evidence, thousands of companies around the world are using goal setting in some form, including Coca Cola Company, PwC, Nike Inc., Intel Corporation, and Microsoft Corporation, to name a few. The city of Pittsburgh set a goal to reduce energy and water usage by 50% by 2030 to combat climate change. Is this a SMART goal? Setting SMART Goals The mere presence of a goal does not motivate individuals. Think about the New Year’s resolutions that many individuals fail to keep. Some decide they should lose some weight but then never put a concrete plan in action. Others decide that they will read more but don’t. Why do 97% of those who set New Year’s resolutions fail to meet their goals? Accumulating research evidence indicates that effective goals are SMART. A SMART goal is a goal that is specific, measurable, aggressive, realistic, and time-bound. Note that different sources use these acronyms slightly differently, and in some organizations A may stand for Achievable, and R may stand for Relevant (to corporate objectives). Ultimately, goals that are SMART are ones that are quantifiable, have a timeline, are relevant to corporate objectives, and are difficult so that they challenge individuals but are not so difficult that they are dismissed out of hand. Shutterstock.com SMART goal A goal that is specific, measurable, aggressive, realistic, and time-bound. Specific and Measurable Effective goals are specific and measurable. For example, “increasing sales to a region by 10%” is a specific goal, whereas deciding to “delight customers” is not specific or measurable. When goals are specific, performance tends to be higher.[49] Why? If goals are not specific and measurable, how would you know whether you have reached the goal? A wide distribution of performance levels © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment could potentially be acceptable. For the same reason, “doing your best” is not an effective goal, because it is not measurable and does not give you a specific target. Certain aspects of performance are easier to quantify. For example, it is relatively easy to set specific goals for productivity, sales, number of defects, or turnover rates. However, not everything that is easy to measure should be measured. Moreover, some of the most important elements of someone’s performance may not be easily quantifiable (such as employee or customer satisfaction). So how do you set specific and measurable goals for these soft targets? Even though some effort will be involved, metrics such as satisfaction can and should be quantified. For example, you could design a survey for employees and customers to track satisfaction ratings from year to year. Aggressive This may sound counterintuitive, but effective goals are difficult, not easy. Aggressive goals are also called stretch goals. According to a Hay Group study, one factor that distinguishes companies that are ranked as “Most Admired Companies” in Fortune magazine is that they set more difficult goals.[50] People with difficult goals outperform those with easier goals.[51] Why? Easy goals do not provide a challenge. When goals are aggressive and require people to work harder or smarter, performance tends to be dramatically higher. One study shows that people who have a high level of self-efficacy and people who have a high need for achievement tend to set more difficult goals for themselves.[52] Finally, a series of two studies has shown that when it comes to difficult goals, who sets the goals matter. Organizationally set difficult goals were associated with heightened anxiety, whereas self-set difficult goals were related to higher levels of enthusiasm. This study points to the importance of the potential emotional reactions to difficult goals, and underlines the importance of involving employees in goal setting where possible.[53] Realistic While goals should be difficult, they should also be based in reality. In other words, if a goal is viewed as impossible to reach, it will not have any motivational value. In fact, setting impossible goals and then punishing people for not reaching these goals is cruel and will demotivate employees. Time-Bound The goal should contain a statement regarding when the proposed performance level will be reached. For example, “increasing sales to a region by 10%” is not a time-bound goal, because there is no time limit. Adding a limiter such as “by December of the current fiscal year” gives employees a sense of time urgency. Even though it seems like a simple concept, in reality many goals that are set within organizations may not be SMART. For example, Microsoft conducted an audit of its goal setting and performance review system and found that only about 40% of the goals were specific and measurable.[54] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 179 180 Organizational Behavior Why Do SMART Goals Motivate? FIGURE 6.3 SMART Goals SMART goals motivate for a variety of reasons. There are at least four reasons why goals motivate.[55] First, goals give us direction. When you have a goal of reducing shipment of defective products by 5% by September, you know that you should direct your energy toward defects. The goal tells you what to focus on. For this reason, goals should be set carefully. Giving employees goals that are not aligned with company goals will be a problem because goals will direct employees’ energies toward a certain end. Second, goals energize people and tell them not to stop until the goal is accomplished. If you set goals for yourself such as “I will have a break from reading this textbook when I finish reading this section,” you will (probably) not give up until you reach the end of the section. Even if you may feel tired along the way, having this specific goal will give you the additional nudge to move forward. Third, having a goal provides a challenge. When people have goals and proceed to reach them, they feel a sense of accomplishment. Finally, SMART goals urge people to think outside the box and rethink how they are working. If the goal is not very difficult, it only motivates people to work faster or longer. If a goal is substantially difficult, merely working faster or longer will not get you the results. Instead, you will need to rethink the way you usually work and devise a creative way of working. It has been argued that this method resulted in designers and engineers in Japan inventing the bullet train. Having a goal that went beyond the speed capabilities of traditional trains prevented engineers from making minor improvements and inspired them to come up with a radically different concept.[56] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment 181 When Are Goals More Effective? Even when goals are SMART, they are not always equally effective. Sometimes, goal setting produces more dramatic effects compared to other methods. At least three conditions that contribute to effectiveness have been identified.[57] Feedback To be more effective, employees should receive feedback on the progress they are making toward goal accomplishment. Providing employees with quantitative figures about their sales, defects, or other metrics is useful for feedback purposes. Ability Employees should have the skills, knowledge, and abilities to reach their goals. In fact, when employees are lacking the necessary abilities, setting specific outcome goals has been shown to lead to lower levels of performance.[58] People are likely to feel helpless when they lack the abilities to reach a goal, and furthermore, having specific outcome goals prevents them from focusing on learning activities. In these situations, setting goals about learning may be a better idea. For example, instead of setting a goal related to increasing sales, the goal could be identifying three methods of getting better acquainted with customers. Goal Commitment SMART goals are more likely to be effective if employees are committed to the goal.[59] As a testament to the importance of goal commitment, Microsoft actually calls employee goals “commitments.”[60] Goal commitment refers to the degree to which a person is dedicated to reaching the goal. What makes people dedicated or committed to a goal? It has been proposed that making goals public may increase commitment to the goal because it creates accountability to peers. When individuals have a supportive and trust-based relationship with managers, goal commitment tends to be higher. When employees participate in goal setting, goal commitment may be higher. Last, but not least, rewarding people for their goal accomplishment may increase commitment to future goals.[61] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. goal commitment The degree to which a person is dedicated to reaching the goal. 182 Organizational Behavior Are There Downsides to Goal Setting? As with any management technique, there may be some downsides to goal setting.[62] First, as mentioned earlier, setting goals for specific outcomes may hamper employee performance if employees are lacking skills and abilities needed to reach the goals. In these situations, setting goals for behaviors and learning may be more effective than setting goals for outcomes. Second, goal setting may prevent employees from adapting and changing their behaviors in response to unforeseen threats. For example, one study found that when teams had difficult goals and employees within the team had high levels of performance expectations, teams had difficulty adapting to unforeseen circumstances.[63] Third, goals focus employee attention on the activities that are measured. This focus may lead to sacrificing other important elements of performance. If goals are set for production numbers, quality may suffer. As a result, it is important to set goals touching on all critical aspects of performance. Finally, an aggressive pursuit of goals may lead to unethical behaviors. If employees are rewarded for goal accomplishment but there are no rewards for coming very close to reaching the goal, employees may be tempted to cheat. For example, when Sears gave its auto repair staff a $147 per hour sales quota, the result was overcharging of customers and the performance of many unnecessary repairs.[64] As such, goals may have unintended consequences, necessitating checks and balances, careful consideration of the ethical climate, and rewarding the right behavior. FIGURE 6.4 Potential Downsides of Goal Setting Ensuring Goal Alignment Through Management by Objectives (MBO) Management by Objectives (MBO) Setting company-wide goals derived from corporate strategy, determining team- and department-level goals, collaboratively setting individual-level goals that are aligned with corporate strategy, developing an action plan, and periodically reviewing performance and revising goals. Goals direct employee attention toward a common end. Therefore, it is crucial for individual goals to support team goals and team goals to support company goals. A systematic approach to ensure that individual and organizational goals are aligned is Management by Objectives (MBO). First suggested by Peter Drucker,[65] MBO involves the following process: 1. Setting company-wide goals derived from corporate strategy 2. Determining team- and department-level goals 3. Collaboratively setting individual-level goals that are aligned with corporate strategy 4. Developing an action plan 5. Periodically reviewing performance and revising goals A review of the literature shows that 68 out of the 70 studies conducted on this topic displayed performance gains as a result of MBO implementation.[66] It also seems that top management commitment to the process is the key to successful implementation of MBO programs.[67] The food industry giant Kraft Heinz is an example of a company using an MBO program. The goals of the company are translated into team- and individual-level goals with employee goals publicly displayed on employee desks.[68] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment Key Takeaway Goal-setting theory is one of the most influential theories of motivation. In order to motivate employees, goals should be SMART (specific, measurable, aggressive, realistic, and timebound). SMART goals motivate employees because they energize behavior, give it direction, provide a challenge, force employees to think outside the box, and devise new and novel methods of performing. Goals are more effective in motivating employees when employees receive feedback on their accomplishments, have the ability to perform, and are committed to goals. Poorly derived goals have the downsides of hampering learning, preventing adaptability, causing a single-minded pursuit of goals at the exclusion of other activities, and encouraging unethical behavior. Companies tie individual goals to company goals using management by objectives. What do you think? 1. Give an example of a SMART goal. 2. If a manager tells you to “sell as much as you can,” is this goal likely to be effective? Why or why not? 3. How would you ensure that employees are committed to the goals set for them? 4. A company is interested in increasing customer loyalty. Using the MBO approach, what would be the department- and individual-level goals supporting this organization-wide goal? 5. Discuss an experience you have had with goals. Explain how goal setting affected motivation and performance. 6.4 Motivating Employees Through Performance Reviews Learning Objectives 1. Understand why companies use performance reviews. 2. Describe basic characteristics of performance reviews. 3. List the characteristics of an effective performance review. 4. Compare the advantages and disadvantages of relative versus absolute reviews. 5. Learn how to conduct a performance review meeting. 6. Understand the biases inherent in performance reviews. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 183 184 Organizational Behavior What Is Performance Management? performance management The use of methods, policies, and procedures to support and improve employee performance. performance review A process in which employee performance is measured and then communicated to the employee. Adobe eliminated annual performance reviews in favor of regular “check-ins” where managers are encouraged to give regular feedback to employees and work on growth plans. Organizations utilize a number of methods, policies, and procedures to support and improve employee performance. These methods are collectively referred to as performance management. An essential part of performance management is performance review. A performance review (also called performance appraisal or performance evaluation) is a process through which employee performance is measured and then communicated to the employee. Employee performance may be measured objectively in jobs such as sales, or subjectively in the form of having managers rate the employee’s performance using pre-established criteria. Many organizations use performance reviews to make decisions about employees, including distributing pay raises, making promotion decisions, and initiating terminations. [69] Performance management and reviews are not synonymous. Unfortunately, many organizations typically treat performance reviews, which often take place once a year, as synonymous with performance management. As a result, in many companies, a performance review became a bureaucratic activity that is mutually despised by employees and managers. A study of Fortune 1,000 companies revealed that 66% of employees were unhappy with their performance reviews, and 65% felt that the review they received was not even relevant to their jobs.[70] In the past few years, organizations including Adobe, Accenture, GE, and Microsoft eliminated annual performance reviews in favor of regular and more frequent feedback sessions.[71] At the same time, organizations such as Facebook believe that retaining the formal performance reviews has benefits. Without a formal review process, employees are still rated behind closed doors, but these ratings are not shared with employees, which creates a lack of transparency.[72] A recent survey of HR professionals by the staffing firm OfficeTeam revealed that 51% had updated their systems in the past two years, with the most common changes being shortening the review forms, increasing the frequency of reviews, adding new scales, and adding peer feedback.[73] jejim/Shutterstock.com What Is the Purpose of a Performance Review? Performance reviews can be important tools to give employees feedback and aid in their development. Yet feedback is only one reason why companies perform reviews. In many companies, reviews are used to distribute rewards such as bonuses, annual pay raises, and promotions. They may also be used to document termination of employees. Research shows that performance reviews tend to be viewed as more effective when companies tie them to reward decisions and to terminate lower performers.[74] This is not surprising in light of motivation theories such as reinforcement theory, which indicates that behavior that is rewarded is repeated. Tying review results to rewards may lead to the perception that performance is rewarded. However, if performance ratings are not accurate, it is possible for reviews to be a major cause of reward unfairness. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment 185 Reprinted by permission. Originally published on ScienceForWork. Who Is the Rater? Traditionally, the rater has been the supervisor. Supervisors have more at stake when an employee is not performing well, and they have access to greater resources that can be used to improve performance. However, relying solely on supervisors may lead to a biased review system. Many aspects of a person’s performance may remain hidden from managers, particularly in team-based settings or organizations where supervisors do not work in the same physical setting as the employees. Therefore, organizations are introducing additional raters into the system, such as peers, customers, and subordinates. As organizations become more flat, introducing more perspectives may provide richer feedback to employees in question. Organizations using supervisors, peers, subordinates, and sometimes even customers are using 360-degree feedback. In this system, feedback is gathered from all these sources, and shared with the employee for developmental purposes. It is important to note that 360-degree systems are not often used in determining pay or promotion decisions and instead are treated as feedback tools. Using 360-degree feedback in reward decisions may be problematic, because individuals may avoid giving objective feedback if it means causing a peer to lose a bonus. Since not all feedback will necessarily be positive, if competition or jealousy exists among peers, some feedback may be retaliatory and too negative. Keeping these problems in mind, organizations may benefit from using only supervisor ratings and available objective performance metrics in reward decisions and using feedback from other sources for developmental purposes.[75] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 360-degree feedback A system where feedback is gathered from supervisors, peers, subordinates, and sometimes even customers. 186 Organizational Behavior What Makes an Effective Review System? adequate notice Letting employees know what criteria will be used during the review. fair hearing Ensuring that there is two-way communication during the review process and the employee’s side of the story is heard. judgment based on evidence Documenting performance problems and using factual evidence. What are the characteristics of an effective review system? Research identified at least three characteristics of reviews that increase the perception that they are fair. These characteristics include adequate notice, fair hearing, and judgment based on evidence. Adequate notice involves letting employees know what criteria will be used during the review. Unfortunately, in many companies the first time employees see the review form may be when they are being evaluated. Therefore, they may be rated low on something they didn’t understand was part of their performance. Fair hearing means ensuring that there is two-way communication during the review process and the employee’s side of the story is heard. Judgment based on evidence involves documenting performance problems and using factual evidence as opposed to personal opinions when rating performance. Ultimately, performance review systems are as good as the managers who use them. When managers believe that people can change and feedback can make a difference, review systems are perceived as more fair. [76] Absolute Ratings versus Relative Rankings As a student, would you rather your performance be evaluated solely on the basis of your own performance, or based on how it compares to others? If your performance is rated based on your own performance on exams, participation, and projects, this would be an absolute rating. Instead, if the class is curved so that your final course grade is an A only if you score in the top 10% of the entire class, it would be a relative ranking. If you say you would prefer an absolute rating, you are not alone. Research shows that ranking systems are often viewed more negatively by employees, and companies such as Microsoft and Amazon abandoned their use. Relative rankings, sometimes called stack rankings, may take the form of forcing managers to rate 20% of employees in the top category, 70% in the middle, and 10% in the bottom category. Employees who are repeatedly ranked at the lowest rank would be terminated. Relative rankings may create a culture of performance by making it clear that low performance is not tolerated; however, there are several downsides to rankings. First, these systems carry the danger of a potential lawsuit. For example, Uber faced lawsuits involving relative rankings, with the claim that the system was implemented in a way that was discriminatory to women.[77] Second, relative rankings are also not consistent with creating a team spirit and may create a competitive, cutthroat environment. These systems may be particularly damaging to morale when managers feel that they need to rank some employees low in order to meet the bell curve. Third, relative systems have limited value in giving employees concrete feedback about what to do next year to get a better ranking. Despite their limitations, relative assessments have one advantage: They prevent performance ratings from becoming inflated by forcing raters to differentiate among employees. Rating inflation is a problem, as rating all employees as high performers may defeat the purpose of reviews if there are real and important performance differences among employees. Given the harms of relative appraisals, organizations are advised not to use them. At the same time, providing raters a suggested distribution and training them to provide accurate ratings are useful methods to encourage raters to create a situation of unrealistically inflated ratings. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment 187 One-on-One and Performance Review Meetings Regardless of how often a formal performance review is conducted, it is important to give employees feedback on a regular basis. As we discussed earlier in this chapter, performance feedback is a useful tool of improving employee performance. Conducting one-on-one meetings on a regular basis (such as weekly or bi-weekly) is a useful practice that supplements the feedback provided in a regular and more formal review. During the formal performance evaluation, after the rater rates the performance of the ratee, both sides meet to discuss positive and negative instances of performance. This meeting serves as an important forum during which the rater gives feedback to the ratee. The goal of providing performance feedback is to help the ratee solve performance problems and to motivate the employee to change behavior. Conducting this meeting may be stressful for both parties, and training managers in providing performance feedback is useful to deal with the stress of the managers as well as creating a more positive experience for both parties.[78] In the most effective meetings, feedback is presented in a constructive manner. Instead of criticizing the person, the focus should be on discussing the performance problems and aiding the employee in resolving these problems. By moving the focus of the conversation from the person to the behaviors, employee defensiveness may be reduced. When the supervisor is constructive, employees develop a more positive view of the review system. Another approach to increasing the effectiveness of review meetings is to increase employee participation. When employees have the opportunity to present their side of the story, they react more positively to the review process and feel that the system is fair. Finally, supervisors should be knowledgeable about the employee’s performance. When it becomes clear that the person doing the evaluation has little understanding of the job being performed by the employee, reactions tend to be more negative.[79] Experts recommend that performance conversations take place face to face. Feedback conversations are an opportunity to build relationships, strengthen organizational culture, and express empathy. Even when taking place remotely, over a videoconferencing platform such as Zoom, turning on the video, paying attention to body language, using supportive language to convey supportiveness, and displaying a problem-solving attitude will be important.[80] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Regular one-on-one meetings are a commonly used performance management tool. These are frequent, short, and held regularly and provide employees with timely feedback as well as support. Shutterstock.com one-on-one meetings A short, frequent, and regularly held meeting with an employee to provide timely feedback and support. 188 Organizational Behavior OB Toolbox: Conducting an Effective Performance Review Meeting Shutterstock.com Before the meeting • Ask the person to complete a self-evaluation. This is a great way of making sure that employees become active participants in the process and get their voice heard. • Complete the performance review form. Document your rating using many examples. Have more examples handy. • Avoid recency bias. Be sure that your review covers the entire year’s performance, not just recent events. • Handle the logistics. Be sure that you devote sufficient time to each meeting. If you schedule meetings back to back, you may lose your energy in later meetings. Be sure that the physical location is conducive to a private conversation. During the meeting • Be sure to recognize effective performance. Give specific praise. • Do not start the meeting with a criticism. Starting with positive instances of performance helps establish a better mood and shows that you recognize what the employee is doing right. • Give employees plenty of opportunities to talk. Ask them about their greatest accomplishments, as well as opportunities for improvement. If they touch on an area you wanted to cover, provide your thoughts. • Show empathy and support. Remember: Your job as a manager is to help the person solve performance problems. Identify areas where you can help. • Set goals and create an action plan. The outcome of the meeting should be a written agreement about what the employee will do in the near future and how the manager will help. After the meeting • Continue to give the employee periodic and frequent feedback. Effective feedback immediately follows key incidents of performance. Do not wait until the next review to discuss important issues. • Follow through on the goals that were set. Provide continuous support to the employee to help him or her achieve the goals. Managing Potential Bias in Performance Reviews Performance reviews are by nature a subjective event. Unless the performance review is purely relying on objective criteria such as sales, it requires one or more human beings to observe and evaluate another and arrive at a consensus. Raters, intentionally or unintentionally, make mistakes or exhibit biases. These biases trickle down into the review system and can affect other decisions that are based on performance ratings, such as pay and promotion. Therefore, being aware of these tendencies is the first step to managing their influence over the review system. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment Liking A performance review does not occur between strangers. The rater and ratee have an existing relationship. If they like or dislike each other, these feelings may bias the ratings. For example, research shows that regardless of their objective performance levels, managers give employees they have a good relationship with higher ratings.[81] It is possible that sometimes liking is not a bias and a manager likes an employee because of high performance levels.[82] Still, for some managers, liking someone may mean ignoring the faults of the person and selectively remembering the positive things that person has done. One way of dealing with this problem may be journaling. By recording positive and negative performance incidents throughout the year for each employee, managers may recall each employee’s performance more accurately.[83] Leniency One of the common problems in reviews is that managers give employees ratings higher than warranted. There may be many reasons for this, such as the desire to avoid confrontation with the employee, having a very agreeable personality, the desire to avoid hurting the chances of the employee to get a bonus, the desire to motivate employees by giving them high ratings, or liking the employee as a person. Regardless of the reason, leniency is a problem because it makes ratings relatively useless for determining raises, bonuses, or promotions. At the same time, leniency makes it harder for employees to change their behaviors. One way of dealing with this problem could be using relative rankings or at least giving managers a suggested distribution. If managers are asked to grade on a curve, they may end up being less lenient. Moreover, making managers accountable for the ratings they give may be a good idea. For example, if managers are evaluated based on how well they recognize different levels of performance, they may be less tempted to be lenient in reviews.[84] Stereotypes One of the factors that creates bias in reviews is the stereotypes that raters may have regarding the gender, race, age or another characteristic of the person being rated. Beliefs about different groups may be generalized to the person in question even though they may have little basis in reality. For example, research shows that women in stereotypically male jobs were rated lower than women in stereotypically female jobs. Similarly, attractive women were rated higher if they held nonmanagement jobs, but they were rated lower if they held management jobs. When factors that have no bearing on one’s job performance are used to evaluate the person, employees, overall, will be demoralized; the reviews will lose their effectiveness, and the company may face costly lawsuits.[85] Understanding the importance of eliminating stereotypes from performance reviews and training managers to accurately observe and evaluate performance may be beneficial in limiting exposure to this type of bias. Key Takeaway Performance reviews involve observing and measuring an employee’s performance during a review period, recording these observations, communicating results to the employee, and recognizing high performance while devising ways of improving deficiencies. Most reviews are conducted by the supervisor, but there are many advantages to using 360-degree reviews. Reviews that are more effective give employees adequate notice, fair hearing, and judgment based on evidence. Some companies use relative rankings in which employees are compared to each other, but this system has many disadvantages. A performance review meeting should © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 189 190 Organizational Behavior be planned and executed carefully, with the supervisor demonstrating empathy and supportiveness. There are intentional and unintentional biases inherent in reviews and being aware of them, increasing rater accountability, and training managers to notice them may be helpful in dealing with some of them. What do you think? 1. What are the disadvantages of using only supervisors as the rater? What are the disadvantages of using peers, subordinates, and customers as raters? 2. Do you believe that self-evaluations are valid? Why would it be helpful to add self-evaluations to the review process? Can you think of any downsides to using them? 3. Why do some managers intentionally give an employee a higher rating than deserved? What are the disadvantages of biased ratings? How could this tendency be prevented? 4. Some organizations choose to abandon formal performance reviews altogether, instead encouraging managers to give feedback to employees on a regular basis. What do you think about this approach? What are the downsides of eliminating reviews altogether? 5. If your objective is to minimize the effects of rater biases, what type of review system would you design? 6.5 Motivating Employees Through Performance Incentives Learning Objectives 1. Learn the importance of financial and nonfinancial incentives to motivate employees. 2. Understand the benefits of different types of incentive systems, such as piece rate and merit pay. 3. Learn why nonfinancial incentives can be effective motivators. 4. Understand the tradeoffs involved in rewarding individual, group, and organizational performance. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment 191 Performance Incentives Perhaps the most tangible way in which companies put motivation theories into action is by instituting incentive systems. Incentives are reward systems that tie pay to performance. There are many incentives used by companies, some tying pay to individual performance and some to companywide performance. Pay-for-performance plans are very common among organizations. For example, a recent study revealed that 75% of organizations in the U.S. utilize a pay-for-performance approach to compensation.[86] Research shows that companies using pay-for-performance systems actually achieve higher productivity, profits, and customer service. These systems are effective for two basic reasons: Employees try harder and increase their effort when they are paid for their performance. Further, these systems encourage less productive workers to quit, and they are often replaced by workers who are more productive, resulting in net productivity gains for organizations.[87] At the same time, potential downsides of incentives exist. For example, it has been argued that incentives may create a risk-averse environment that diminishes creativity. This may happen if employees are rewarded for doing things in a certain way, and taking risks may negatively affect their paycheck. Moreover, research shows that incentives tend to focus employee energy on goaldirected efforts, and behaviors such as helping team members or being a good citizen of the company may be neglected.[88] Despite their limitations, financial incentives may be considered powerful motivators if they are used properly and if they are aligned with companywide objectives. The most frequently used incentives are listed below. Piece Rate Systems Under piece rate incentives, employees are paid on the basis of individual output they produce. For example, a manufacturer may pay employees based on the number of purses sewn or number of doors installed in a day. In the agricultural sector, farm workers are often paid based on the amount of fruits and vegetables they pick. These systems are suitable when employee output is easily observable or quantifiable and when output is directly correlated with employee effort. Piece rate systems are also used in white-collar jobs such as check-proofing in banks. These plans may encourage employees to work fast but may also increase the number of errors made. Therefore, rewarding employee performance minus errors might be more effective. Today, increases in employee-monitoring technology are making it possible to correctly measure and observe individual output. For example, technology can track the number of tickets an employee sells or the number of customer complaints resolved, allowing a basis for employee pay incentives.[89] Piece rate systems can be very effective in increasing worker productivity. For example, Safelite AutoGlass, a nationwide installer of auto glass, moved to a piece rate system instead of paying workers by the hour. This change led to an average productivity gain of 20% per employee.[90] Incentives have been around for a long time. For example, Napoleon promised 12,000 francs to whoever found a way to preserve food for the army. The winner of the prize was Nicolas Appert, shown here, who developed a method of canning food. Source: Les Artisans illustres 1841, collection Jean-Paul Barbier, Musée des Beaux Arts Châlons en Champagne. piece rate incentives Payment to employees made on the basis of their individual output. Individual Bonuses Bonuses are one-time rewards that follow specific accomplishments of employees. For example, an employee who reaches the quarterly goals set for her may be rewarded with a lump sum bonus. Employee motivation resulting from a bonus is generally related to the degree of advanced knowledge regarding bonus specifics. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. bonuses One-time rewards that follow specific accomplishments of employees. 192 Organizational Behavior Merit Pay merit pay Giving employees a permanent pay raise based on past performance. Properly designed sales commissions are widely used to motivate sales employees. The blend of straight salary and commissions should be carefully balanced to achieve optimum sales volume, profitability, and customer satisfaction. Shutterstock.com In contrast to bonuses, merit pay involves giving employees a permanent pay raise based on past performance. Often the company’s performance appraisal system is used to determine performance levels and the employees are awarded a raise, such as a 2% increase in pay. One potential problem with merit pay is that employees come to expect pay increases. In companies that give annual merit raises without a different raise for increases in cost of living, merit pay ends up serving as a cost-of-living adjustment and creates a sense of entitlement on the part of employees, with even low performers expecting them. Thus, making merit pay more effective depends on making it truly dependent on performance and designing a relatively objective appraisal system. Sales Commissions In many companies, the paycheck of sales employees is a combination of a base salary and commissions. Sales commissions involve rewarding sales employees with a percentage of sales volume or profits generated. In companies such as Oracle, Salesforce.com, Cisco Systems, and SAP, sales commissions may bring an otherwise modest base salary to six-figure incomes. Sales commissions should be designed carefully to be consistent with company objectives. For example, employees who are heavily rewarded with commissions may neglect customers who have a low probability of making a quick purchase. If only sales volume (as opposed to profitability) is rewarded, employees may start discounting merchandise too heavily, or start neglecting existing customers who require a lot of attention.[91] Therefore, the blend of straight salary and commissions needs to be managed carefully. sales commissions Rewarding sales employees with a percentage of sales volume or profits generated. employee recognition awards Awards, plaques, or other symbolic methods of recognition that convey appreciation for employee contributions. Employee Recognition Awards Some companies manage to create effective incentive systems on a small budget while downplaying the importance of large bonuses. Employee recognition awards motivate employees through awards, plaques, or other symbolic methods of recognition by conveying sincere appreciation for employee contributions. For example, Yum! Brands Inc., the parent company of brands such as KFC and Pizza Hut, recognizes employees who go above and beyond job expectations through creative awards such as the seat belt award (a seat belt on a plaque), symbolizing the roller-coaster-like, fastmoving nature of the industry. Other awards include things such as a plush toy shaped like a jalapeño pepper. In many companies, peers are also involved in nominating their coworkers for recognition awards.[92] A popular way of recognizing employee accomplishments is awarding gift cards. These methods are more effective if employees have a choice among alternatives (such as between restaurants, or between a restaurant or a retailer). © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment 193 Team Bonuses In situations in which employees should cooperate with each other and isolating employee performance is more difficult, companies are increasingly resorting to tying employee pay to team performance. For example, Covenant Transportation awards driver teams bonuses of $2,000 when the team completes 60,000 miles.[93] Team bonuses tend to be more effective if employees have a reasonable ability to influence their team’s performance level. Peer to peer recognition is increasingly popular, such as T-Mobile’s “Appreciation Zone” where employees can nominate each other for awards. Gainsharing Gainsharing is a company-wide program in which employees are rewarded for performance gains compared to past performance. These gains may take the form of reducing labor costs compared to estimates or reducing overall costs compared to past years’ figures. These improvements are achieved through employee suggestions and participation in management through employee committees. For example, Premium Standard Farms LLC, a meat processing plant that was acquired by Smithfield Foods in 2007, instituted a gainsharing program in which employee-initiated changes in production processes led to a savings of $300,000 a month. The bonuses were close to $1,000 per person. These programs can be successful if the payout formula is generous, employees can truly participate in the management of the company, and if employees are able to communicate and execute their ideas.[94] Helen89/Shutterstock.com gainsharing A company-wide program in which employees are rewarded for performance gains compared to past performance. Profit Sharing Profit-sharing programs involve sharing a percentage of company profits with all employees. These programs are company-wide incentives and are not very effective in tying employee pay to individual effort, because each employee will have a limited role in influencing company profitability. At the same time, these programs may be more effective in creating loyalty and commitment to the company by recognizing all employees for their contributions throughout the year. profit sharing Programs involving sharing a percentage of company profits with all employees. Stock Options A stock option gives an employee the right, but not the obligation, to purchase company stocks at a predetermined price. For example, a company would commit to sell company stock to employees or managers two years in the future at $30 per share. If the company’s actual stock price in two years is $60, employees would make a profit by exercising their options at $30 and then selling them in the stock market. The purpose of stock options is to align company and employee interests by making employees owners. However, options are not very useful for this purpose, because employees tend to sell the stock instead of holding onto it. Options remain popular in start-up companies that find it difficult to offer competitive salaries to employees. In fact, many employees in high-tech companies such as Microsoft and Cisco Systems Inc. became millionaires by cashing in stock options after these companies went public. Many companies make options available to employees at all levels. For example, L'Oréal started an employee share ownership program where employees in 52 countries can purchase company stock at 20% discount from the opening price of a specified date.[95] In recent years, stock option use has declined. One reason for this is the changes in options accounting. Before 2005, companies did not have to report options as an expense. After the changes in accounting rules, it became more expensive for companies to offer options. Moreover, options are less attractive or motivational for employees when the stock market is going down, because the cost of exercising their options may be higher than the market value of the shares. Because of these © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. stock option Giving an employee the right, but not the obligation, to purchase company stocks at a predetermined price. 194 Organizational Behavior and other problems, some companies started granting employees actual stock or using other incentives. For example, PepsiCo Inc. replaced parts of the stock options program with a cash incentive program and gave managers the choice of getting stock options coupled with restricted stocks.[96] Key Takeaway Companies use a wide variety of incentives to reward performance. This is consistent with motivation theories showing that rewarded behavior is repeated. Piece rate, individual bonuses, merit pay, and sales commissions tie pay to individual performance. Team bonuses are at the department level, whereas gainsharing, profit sharing, and stock options tie pay to company performance. While these systems may be effective, people tend to demonstrate behavior that is being rewarded and may neglect other elements of their performance. Therefore, reward systems should be designed carefully and should be tied to a company’s strategic objectives. What do you think? 1. Have you ever been rewarded under any of the incentive systems described in this chapter? What was your experience with them? 2. What are the advantages and disadvantages of bonuses compared to merit pay? Which one would you use if you were a manager at a company? 3. What are the advantages of using awards as opposed to cash as an incentive? 4. How effective are stock options in motivating employees? Why do companies offer them? 5. Which of the incentive systems in this section do the best job of tying pay to individual performance? Which ones do the worst job? 6.6 Focus on Motivating Work Environments, Ethics, Technology, and National Culture Learning Objectives 1. Consider the role of job design, goals, and reward systems in ethical behavior. 2. Consider the role of technology for job design. 3. Consider the role of national culture on job design, goals, and reward systems. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment 195 Designing a Motivating Work Environment and Ethics The design components of an organization’s internal environment, such as the presence of goal setting, performance reviews, and the use of incentive-based reward systems, have a direct connection with the level of ethical or unethical behaviors demonstrated within a company. Although a large number of companies successfully use goal setting and rewarding employees based on goal accomplishment, there is an unintended consequence to using goals: Goal setting may lead to unethical behaviors on the part of employees. When goal accomplishment is rewarded, and when rewards are desirable, employees will have two basic options: Work hard to reach the goals, or cheat. Shutterstock.com The connection between goal setting and unethical behaviors has been well documented. For example, a school superintendent was sentenced to 3–5 months in prison as well as fines exceeding $200,000 because he intentionally misclassified struggling students to make them exempt from particular tests in which test scores were directly tied to administrator bonuses.[97] Salespeople working on commissions may push customers to make a purchase beyond their budget. At higher levels within companies, a CEO’s method of payment has been related to the ethical behaviors of companies. When a large percentage of a CEO pay package consists of stock options, companies are more likely to misrepresent the financial situation of the company, particularly when the CEO is also the head of the board of directors.[98] This does not mean that goal setting always causes unethical behavior. People who behave unethically tend to constitute a small percentage of the workforce. However, for this small percentage, goal setting and incentives act as motivation to behave unethically. The tendency to behave unethically under these systems also increases when goals are not met, but instead, employees come close to reaching them, particularly when they are competing against each other to receive the rewards.[99] There are several ways companies can reduce the temptation to behave unethically. Specifically rewarding ethical behavior within the company is related to lower levels of unethical behaviors.[100] Also, instead of only rewarding people who reach a high goal and not giving anything to those who come close, companies may consider creating multiple levels of goals and distribute rewards corresponding to the goal that is achieved.[101] Enforcing an ethical code of conduct and withholding rewards from those who are not demonstrating ethical behaviors are other ways of preventing goal setting from leading to unethical behaviors. Motivating Work Environments and Technology Technological advances are changing the nature of work, and affecting job characteristics that have been shown to be related to employee motivation. For example, advances in information technology have been allowing employees to work remotely. Working from home often allows employees to be more autonomous, as there are fewer opportunities for close supervision, and employees may be evaluated based on the outcomes of their work as opposed to the process. However, technology is also increasing opportunities for companies to monitor employees when working at home, such as via the use of keyboard monitoring technology or video cameras, which may erode these gains in autonomy if utilized. Working away from one’s coworkers may reduce the amount of feedback available from managers and coworkers, which may happen more spontaneously when employees and coworkers are co-located. However, information technology may also facilitate the ability to collect more feedback from these sources or from other sources such as customers. In other words, the net effects of technology on job design is likely to depend on the type of technology being used and the specific ways in which it is used. [102] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Shutterstock.com 196 Organizational Behavior electronic monitoring Electronic surveillance of employees in order to track employee performance, reduce legal liability, or protect employer’s trade secrets. Electronic monitoring, or electronic surveillance of employees in order to track employee performance, reduce legal liability, or protect employer’s trade secrets has become more common with technological advances enabling companies to do so. In the USA, the law offers employers leeway in the types of behaviors they can monitor as long as employees are notified in advance. Still, motivational implications of electronic monitoring need to be weighed against any potential benefits, given potential privacy concerns and harmful effects on a sense of autonomy, trust in the organization, and fairness.[103] Technology is also enabling companies to apply principles of gamification to motivate employees and increase their performance. For example, call center employees may engage in self competition to reduce their call completion times or increase customer satisfaction ratings. When the employee reaches a specific level, they receive a reward such as a bonus. Alternatively, employees may compete against their peers, or teams may compete with each other. Of course gamification methods can be used without the use of technology as well (such as writing down each person’s performance level on a white board) but the advance of digital and mobile apps to facilitate gamification of employee performance may make these approaches more engaging, provide immediate feedback, and increase participation.[104] Designing a Motivating Work Environment Around the Globe Shutterstock.com The effectiveness of methods such as job design, goal setting, performance evaluations, and the use of incentives is likely to be culturally determined. For example, research conducted in Western countries suggests that empowering employees is an effective method of motivating them. However, not all employees around the world respond favorably to concepts such as autonomy or empowerment. For example, it has been noted that the use of self-managing teams, a method of increasing employee empowerment in the workplace, is difficult to execute in Mexican companies because of the traditionally paternalistic and hierarchical nature of many Mexican organizations. In such a context, employees may not be willing or ready to take responsibility for individual action, while managers may be unwilling to share real power with employees.[105] Researchers also found in a four-country study that while employees in the United States, Mexico, and Poland responded positively to empowerment, Indian employees were actually less satisfied when they were empowered.[106] In other words, we may expect both greater levels of difficulty and potentially different reactions to empowerment depending on the cultural context. Are all employees around the globe motivated by goal setting? Even though there is limited research in this area, existing findings point to some differences. For example, we know that American employees respond negatively to goals when these goals are perceived to be extremely difficult. However, Chinese employees actually were most motivated when the goals were very difficult. This may be because Chinese employees believe that their performance depends on their effort, and therefore they are able to respond to goals that are very difficult with very high effort. On the other hand, there is some evidence that while specific goals motivate Western salespeople, in China goals low in specificity were more motivational.[107] How about performance evaluations? You may predict that concepts such as 360-degree feedback are not suitable to all cultures. Research shows that multiple-rater systems are less effective in power distant and collectivist cultures.[108] The 360-degree feedback requires a climate of openness and social equality in the workplace. Therefore, countries high in power distance and authoritarianism respond negatively to review systems where lower level employees give performance feedback to their managers. Likewise, in cultures high in collectivism, using peer reviews may not be as effective, because employees might be hesitant to give accurate performance feedback to their colleagues with the fear that negative feedback may damage interpersonal relationships. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment Key Takeaway Goal setting and reward systems influence the level of ethics in the work environment. When employees come close to reaching their goals but fall short, they are more likely to behave unethically. The type of incentive system used in a company may generate unethical behaviors. Technology affects job characteristics but the effects depend on which technology is adopted and how it is used. Job design, goal setting, performance reviews, and incentives should be designed while considering the national culture context because they may not be universally valid. What do you think? 1. Do you have any experience with goal setting leading to unethical behaviors? 2. Many observers and employees are concerned about the spread between CEO pay and average employee pay. Is it ethical for CEOs to be paid so much more than other employees? Under which conditions would it be unethical? 3. How would you determine whether a certain incentive scheme or a type of performance reviews could be transferred to a different culture? 6.7 Retail with a Purpose: The Case of REI Joshua Rainey Photography/Shutterstock.com With the shift in consumer shopping toward online retailers such as Amazon, big box retailers are struggling, with well-known names including Toys R Us, Radioshack, and Sports Authority declaring bankruptcy. There are those who buck this trend, though. Recreational Equipment Inc., or REI, the seller of outdoor clothing and gear with nearly 15,000 employees and over 160 stores around the United States in 2019, is still going strong. The company has been among Fortune magazine's top 100 companies to work for 23 years in a row and boasts a modest overall turnover rate of 37% in an industry plagued with retention issues. How does the company survive the rough terrain of retail industry while keeping and engaging its employees? To answer this question, it helps to understand REI's structure and mission. Having owners understand customers is a boon for all businesses, but in REI's case, customers are the owners. In 1938, Lloyd and Mary Anderson started the company to help outdoor enthusiasts shop for © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 197 198 Organizational Behavior gear more easily. The company is organized as a cooperative (or co-op), which means that it is owned by its customers. In other words, REI is owned by its 19 million customers who share a passion around the outdoors. The company's CEO Eric Artz defines REI as an organization driven by a mission “to awaken a lifelong love for the outdoors, for all.” This purpose allows the company to focus its energies and resources on goals and problems its employees and customers care about. For example, since 2016, the company has given back 70% of its profits to causes supporting access to the outdoors and protection of public lands. In 2018, the company went one step further and released a set of environmental standards its suppliers would need to follow in order to have their products in REI stores. For example, suppliers need to ensure that their products do not contain certain chemicals known to harm the environment, and they have to ensure that their supplier network follows a code of conduct as part of manufacturing. REI's core passion around connecting individuals to nature also is infused into its employee management practices. For example, employees are given two Yay-days a year, which allows them to spend the day outdoors. They simply need to hand in their certificate to their manager and tell them what they will be doing instead of coming to work that day. The company also made the news with its #optoutside movement. The company closed all stores on Black Friday (the day after Thanksgiving, which is a major shopping day when many retailers offer unusually long hours) and encouraged employees and customers to spend the day outside. REI gives employees voice and aims to build a sense of community. In their online platform "campfire," employees have the ability to speak up and engage in debates about issues important to them. The year after the platform launched, 40% of REI employees had logged into the system. They also hold "town hall" meetings where employees are encouraged to ask questions, get informed, and let management know what issues concern them. REI's compensation practices support the sense of community as well. In addition to bonuses for individual goal achievement, individuals get bonuses based on reaching departmental and organizational goals. The company also utilizes a profit-sharing program where employees receive up to 10% discretionary funding toward their retirement plans based on company profitability.[109] Multimedia Extension—The REI Co-Op in 94 Seconds View in the online reader Case Discussion Questions 1. What connection can you see between REI being a purpose-driven organization and employee motivation? 2. Do you believe that Yay Day and #optoutside are practices other retailers can and should embrace? Why or why not? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 6 Designing a Motivating Work Environment 3. In your view, what are the motivational advantages and disadvantages of tying employee compensation to company profitability and departmental performance? 4. In your view, are all employees interested in finding meaning at work? How can organizations ensure that employees get a sense of meaning if the organization is not "purpose driven”? 5. What is the role of giving employees voice in employee motivation? 6.8 Conclusion In this chapter, we reviewed specific methods with which companies attempt to motivate their workforce. Designing jobs to increase their motivating potential, empowering employees, setting goals, evaluating performance using performance reviews, and tying employee pay to individual, group, or organizational performance using incentive systems are methods through which motivation theories are put into action. Even though these methods seem to have advantages, every method could have unintended consequences, and therefore, application of each method should be planned and executed with an eye to organizational fairness. 6.9 Exercises Ethical Dilemma James is about to conduct a performance review for Maria. Maria has exhibited some performance problems in the past six months. She has been coming in late and leaving early, and she missed two important deadlines. At the same time, she is a very likeable and nice person who gets along well with others in the office. James also knows that Maria has a significant amount of debt and getting a bonus after this review would really help her. James does not want to jeopardize his relationship with her and he does not want to prevent her from getting the bonus. Therefore, he is considering giving her a “good” rating in the review. What would be your advice to James regarding this situation? Individual Exercise • A call center is using the metric of average time per call when rewarding employees. In order to keep their average time low, employees are hanging up on customers when they think that the call will take too long to answer. • In a department store, salespeople are rewarded based on their sales volume. The problem is that they are giving substantial discounts and pressuring customers to make unnecessary purchases. • All employees at a factory are receiving a large bonus if there are no reported injuries for six months. As a result, some employees are hiding their injuries so that they do not cause others to lose their bonus. What are the reasons for the negative consequences of these bonus schemes? Modify these schemes to solve the problems. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 199 200 Organizational Behavior Group Exercise Performance Review Role Play This role play will involve three students. 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Retrieved from http://www.timesfreepress.com/news/business/aroundregion/story/2018/may/08/covenant-transportpays-2000-bonuses-44-teams/470318/ 94. Balu, R., & Kirchenbaum, J. (2000, December). Bonuses aren’t just for bosses. Fast Company, 41, 74–76; Collins, D., Hatcher, L., & Ross, T. L. (1993). The decision to implement gainsharing: The role of work climate, expected outcomes, and union status. Personnel Psychology, 46, 77–104; Imberman, W. (1996, January–February). Gainsharing: A lemon or lemonade? Business Horizons, 39, 36; Smithfield Foods. (2007, May 7). Smithfield Foods completes acquisition of Premium Standard Farms, Inc [Press release]. https://www.smithfieldfoods.com/press-room/companynews/smithfield-foods-completes-acquisition-of-premium-standardfarms-inc 95. L'Oreal (May 15, 2018). L'ORÉAL: news release: "Launch of an employee share ownership plan." Retrieved from https://globenewswire.com/newsrelease/2018/05/15/1502239/0/en/L-OREAL-News-Release-Launch-ofan-Employee-Share-Ownership-Plan.html 96. Brandes, P., Dharwadkar, R., Lemesis, G. V., & Heisler, W. J. (2003, February). Effective employee stock option design: Reconciling stakeholder, strategic, and motivational factors. Academy of Management Executive, 17, 77–93; Rafter, M. V. (2004, September). As the age of options wanes, companies settle on new incentive plans. Workforce Management, 83, 64–67; Marquez, J. (2005, September). Firms replacing stock options with restricted shares face a tough sell to employees. Workforce Management, 84, 71–73. 97. Zubrzycki, J. (10/17/2012). Cheating scandal lands ex-superintendent in prison. Education Week, 32, 6. 98. Harris, J., & Bromiley, P. (2007). Incentives to cheat: The influence of executive compensation and firm performance on financial misrepresentation. Organization Science, 18, 350–367; Priem, R. L., Coombs, J. E., & Gilley, K. M. (2006). Do CEO stock options prevent or promote fraudulent financial reporting? Academy of Management Journal, 49, 483–500. 99. Bellizzi, J. A. (1995). Committing and supervising unethical sales force behavior: The effects of victim gender, victim status, and sales force motivational techniques. Journal of Personal Selling & Sales Management, 15, 1–15; Schweitzer, M. E., Ordonez, L., & Douma, B. (2004). Goal setting as a motivator of unethical behavior. Academy of Management Journal, 47, 422–432. 100. Trevino, L. K., & Youngblood, S. A. (1990). Bad apples in bad barrels: A causal analysis of ethical decision-making behavior. Journal of Applied Psychology, 75, 378–385. 101. Locke, E. A. (2004). Linking goals to monetary incentives. Academy of Management Executive, 18, 130–133. 102. Oldham, G. R., & Fried, Y. (2016). Job design research and theory: Past, present, and future. Organizational Behavior and Human Decision Processes, 136, 20-35. 103. Nguyen, A. (Summer 2020). On the clock and at home: Post-Covid-19 employee monitoring in the workplace. People & Strategy, 43 (3), 30-33. 104. Korzeniowski, P. (December 2019). With gamification, contact centers can be fun. Customer Relationship Management, 23, (10). 24-27. 105. Nicholls, C. E., Lane, H. W., & Brechu, M. B. (1999). Taking self-managed teams to Mexico. Academy of Management Executive, 13(3), 15–25. 106. Robert, C., Probst, T. M., Martocchio, J. J., Drasgow, F., & Lawler, J. J. (2000). Empowerment and continuous improvement in the United States, Mexico, Poland, and India: Predicting fit on the basis of the dimensions of power distance and individualism. Journal of Applied Psychology, 85, 643–658. 107. Fang, E., Palmatier, R. W., & Evans, K. R. (2004). Goal-setting paradoxes? Trade-offs between working hard and working smart: The United States versus China. Journal of the Academy of Marketing Science, 32, 188–202. 108. Peretz, H., & Fried, Y. (2012). National cultures, performance appraisal practices, and organizational absenteeism and turnover: A study across 21 countries. Journal of Applied Psychology, 97, 448-459. Chapter 6 Designing a Motivating Work Environment 109. Case written by Berrin Erdogan and Talya Bauer to accompany Bauer, T. N., & Erdogan, B. (2021). Organizational Behavior: Bridging Science and Practice (4.0). Boston, MA: FlatWorld. Partially based on ideas and information contained in Douglas, G. (March 9, 2018). REI's brand helps it overcome common wellness obstacles. Retrieved from https://www.bna.com/reis-brand-helps-n57982089676/; Fortune's 100 best (2017). Retrieved from http://fortune.com/best-companies/rei; Jones, C. (April 11, 2018). Do you wanrt to sell your products at REI? Then be kind to the planet. USA Today; Lam, B. (March 21, 2017). How REI's co-op retail model helps its bottom line. Retrieved from https://www.theatlantic.com/business/archive/2017/03/rei-jerry-stritzke-interview/520278/; REI coop (2018). Pay and benefits. Retrieved from https://rei.jobs/portal/ 11/docs/rei-pay-and-benefits.pdf; Schawbel. D. (April 12, 2017). Jerry Stritzke: How he leads REI, a purpose-driven organization. Forbes; Vorhauser-Smith, S. (August 14, 2013). How the best places to work are nailing employee engagement. Forbes; Zillman, C. (September 15, 2017). A retailer finds its voice. Fortune, 176 (4); REI Co-op. (2019). 2019 stewardship report. Retrieved from https://www.rei.com/stewardship; REI Co-op. (2019, May 6). REI Co-op names Eric Artz its eighth president and CEO. Retrieved from https://www.rei.com/newsroom/article/rei-coop-names-eric-artz-its-eighth-president-and-ceo#:~:text=âOur purpose at REIâour,the planet?â said Artz. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 203 204 Organizational Behavior © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. CHAPTER 7 Stress and Emotions at Work Shutterstock.com Learning Objectives After reading this chapter, you should be able to do the following: 1. Understand the stress cycle. 2. Recognize the sources of stress for employees. 3. Recognize the outcomes of stress. 4. Understand how to manage stress in organizational contexts. 5. Understand the role emotions play for attitudes and behaviors at work. 6. Learn about emotional labor and how to manage it. 7. Understand connections between stress and emotions at work and ethics, technology, and cross-cultural management. Stress is a fact of life and is experienced by people of all ages every day. Even those who are not taking a college course on psychology or organizational behavior will have some understanding of this term. In fact, if you were to ask the “person on the street,” they will likely define stress as something that is bad for you and your health. Because it is such a familiar, commonly used term, they will also likely have some misconceptions about stress, such as “stress is usually bad for performance” or “stress is usually caused by negative events.” In this chapter, we will review the basics of stress research and address some of the common myths about it. We will also cover the role of emotions at work. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 206 Organizational Behavior 7.1 Mitigating Stress with Mission: The Case of SpaceX L Galbraith/Shutterstock.com SpaceX was founded in 2002 with the goal of reducing space transportation costs and creating the technology needed to colonize Mars. This lofty mission was the brainchild of the company’s founder, Elon Musk. Musk is known for being a visionary and controversial leader with ambitious goals for his companies. In addition to his role as CEO of SpaceX, he is in leadership positions at Tesla, an electric vehicle and solar panel manufacturer; SolarCity, a solar energy services company; Neuralink, a neurotechnology company; and The Boring Company, an infrastructure and tunnel construction company. A 2016 employee survey ranked SpaceX as having the highest stress work environment among top tech companies. Interestingly, SpaceX also ranked highest among the companies surveyed for being the most meaningful place to work. This sense of purpose is inspired by SpaceX’s mission to make humans an inter-planetary species, as well as by its frequent rocket launches which serve as small but tangible milestones toward its grander mission. In addition to successfully launching astronauts into space in 2020, SpaceX plans to put astronauts on the moon by 2024. One of SpaceX’s board members attributed the organization’s success to the strong “meaningfulness” factor felt by its employees. After a little over 50 years of the first person stepping on the moon, SpaceX became the first private company to transport astronauts to Earth from the International Space Station when Bob Behnken and Doug Hurley made a safe water landing on SpaceX’s Crew Dragon capsule on August 2, 2020. Musk is also known for motivating his employees by making them feel like part of a larger team. He encourages senior managers to practice servant leadership, the principle of inspiring others through selflessness and helping them succeed by eliminating barriers they encounter while striving toward their goals. He is reported to expect senior leaders to work harder than those who report to them, and to make sure their teams’ needs are met before their own. Further, Musk is reported to have exceptionally high standards, be excessively demanding of his employees, and exhibit workaholic tendencies himself. In 2018, he tweeted, “There are easier places to work, but nobody ever changed the world on 40 hours a week.” This type of leadership has been criticized for potentially leading to a culture of burnout. Much like many Silicon Valley tech companies, Musk entices SpaceX employees to spend more time at work and to remain committed to the mission by providing perks such as free food and an in-house massage therapist. He also invites celebrities to give private talks, provides employeeonly movie screenings, and sends employees encouraging emails and addresses them at regular all-hands gatherings. These gatherings are especially poignant when they are tied to a launch, which enables employees to celebrate the fruits of their labor.[1] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work 207 Multimedia Extension—SpaceX CEO Elon Musk on the Next Giant Leap for Mankind View in the online reader Case Discussion Questions 1. Would you be motivated by a company culture such as the one at SpaceX? Why or why not? 2. Do you think Musk’s leadership style would work well at a company with a different type of mission? 3. What do you think are some characteristics of people who aspire to work at a place like SpaceX? Do you think this has anything to do with its stress and meaningfulness rankings? 4. Do you think SpaceX’s mission or its perks are more meaningful in encouraging employees to stick around, despite the high-stress environment? 5. If leadership at SpaceX began to encourage more work-life balance for its employees, how do you think that would impact the overall performance of the organization? Please explain. 7.2 What Is Stress? Learning Objectives 1. Understand what stress is. 2. Learn about different models of stress. 3. Learn what stressors are. 4. Understand the outcomes of stress. 5. Understand individual differences in experienced stress. Stress is defined by psychologists as the body’s reaction to a change that requires a physical, mental, or emotional adjustment or response. In other words, stress is your body’s response to an environmental demand, and it is a force strong enough to move your body or mind out of alignment. One important aspect of this definition is the subjective nature of stress. What moves you out of your balance and what you perceive as a serious demand on your mind and body will likely be different from what will be stressful to your manager, your colleagues, or your family members. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. stress The body’s reaction to a change that requires a physical, mental, or emotional adjustment or response. 208 Organizational Behavior You may have noticed that people around you do not react similarly to a test, an opportunity to speak in public, or an offer to pet a reptile. What makes an event stressful is one’s perception that it is a significant event that requires coping and it causes tension within you. Researchers often assess self-report surveys to measure the effects of stress at work. And, when it comes to surveys about stress, the results have been eye-opening. For example, according to a 2019 Gallup poll, 55% of Americans reported they felt stressed sometimes or frequently during their day and 83% of workers reported job stress as an issue for them; almost as many employees ended the day exhibiting physical effects of stress, including neck pain, aching muscles, and insomnia.[2] The American Psychological Association’s 2019 annual survey of stress in the U.S. found that approximately 60% of respondents indicated that money and work were significant stressors.[3] Additionally, a Gallup poll conducted in 2020 showed that 46% of workers in the U.S. had concerns about COVID-19 exposure in the workplace.[4] It is clear that many individuals experience stress at and related to work and feel that stress is a negative influence over them. hindrance stressors Stress caused by factors that detract us from our personal goals and prevent personal growth. challenge stressors Demands and circumstances that cause stress but also promote individual growth. Different stressors (events that cause a stress reaction) have different effects on our well-being. Researchers distinguished between challenge stressors and hindrance stressors. Hindrance stressors refer to stress caused by factors that detract us from our goals and prevent personal growth, such as stress caused by interpersonal conflict, work-life conflict, and daily hassles such as your computer malfunctioning and being cut off in traffic. Challenge stressors refer to demands and circumstances that cause stress but that also promote individual growth, such as high work pressures, high levels of responsibility, or having a lot of (high-quality) work to do. While both forms of stress contribute to burnout, challenge stressors also promote work engagement.[5] Models of Stress When covering employee motivation, we discussed several theories explaining what motivates employees. Similarly, there are many theories of what causes stress and our body’s reactions to it. In this chapter, we will review three of these models. General Adaptation Syndrome Hans Selye, one of the founders of the American Institute of Stress, spent his life examining the human body’s response to stress. As an endocrinologist who studied the effects of adrenaline and other hormones on the body, Selye believed that unmanaged stress could create physical problems such as ulcers and high blood pressure, and psychological illnesses such as depression. He hypothesized that stress played a general role in disease by exhausting the body’s immune system and termed this phenomenon the General Adaptation Syndrome (GAS).[6] The GAS model predicts that when there is a threat to the individual’s natural balance, the body responds by engaging in a “fight-or-flight” response.[7] Our bodies prepare for these scenarios with an increased heart rate, shallow breathing, and wide-eyed focus. Our veins constrict, acting as an armor—blood is sent to the muscles, making it easier to fight or flee, and less likely for us to lose blood if we are injured. Non-essential systems such as the digestion and immune system are stopped in preparation for the fight-or-flight response. (Our body is likely assuming that we should survive the fight first, before getting worried about catching a cold.) These traits allowed our ancestors to flee the scene of their impending doom or more effectively engage in a physical battle for survival. What is interesting is that our body does not distinguish between stress in the form of a wild animal attack and stress in the form of an 8 a.m. deadline—the physical manifestations are the same. More recent research has found that another potential reaction observed is the “tend-andbefriend” response where experienced stress leads some individuals to more nurturing behaviors © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work for those around them and to engage in the creation and maintenance of social networks. While early research suggested that women may be especially prone to engage in this type of stress reaction,[8] more recent findings suggest that a person’s attachment style, regardless of sex, may be a stronger predictor.[9] In a study of retail clothing managers, researchers found that managers’ perceived stress was positively related to sharing knowledge with employees, which was related to turnover intentions and actual turnover.[10] FIGURE 7.1 Selye’s GAS Model In Selye’s GAS model, stress affects an individual in three steps: alarm, resistance, and exhaustion. In the GAS model, our body passes through different stages, as exposure to stress is prolonged. In the alarm phase of stress, an outside stressor jolts the individual, insisting that something must be done. It may help to think of this as the fight-or-flight moment in the individual’s experience. If the response is sufficient, the body will return to its resting state after having successfully dealt with the source of stress. If stress continues past the alarm stage, we move into the resistance phase, where the body begins to release cortisol and draws on reserves of fats and sugars to find a way to adjust to the demands of stress. This reaction works well for short periods of time, but it is only a temporary fix. Individuals forced to endure the stress of cold and hunger may find a way to adjust to lower temperatures and less food. While it is possible for the body to “adapt” to such stresses, the situation cannot continue. The body is drawing on its reserves, like a hospital using backup generators after a power failure. It can continue to function by shutting down unnecessary items like large overhead lights, elevators, televisions, and most computers, but it cannot proceed in that state forever. If our body cannot return to equilibrium because the stress lasts too long or is too severe, we move into the exhaustion phase, in which the body has depleted its stores of sugars and fats, and the prolonged release of cortisol has caused the stressor to significantly weaken the individual. Disease results from the body’s weakened state, leading to death in the most extreme cases. This eventual depletion is why we’re more likely to reach for foods rich in fat or sugar, caffeine, or other quick fixes that give us energy when we are stressed. As you can see, GAS explains how our body reacts and responds to stress physically and biologically. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 209 210 Organizational Behavior Demand-Control Model GAS is a useful model for understanding the biological effects of stress, and the effects of acute stress, which may be life-threatening, such as the stress experienced by soldiers in battle. But not all stress is life-threatening. Instead, much of work stress is ever-present—less extreme but chronic. Karasek developed the demand-control model for such environments. According to this model, the highest level of stress occurs when job demands are high and job control is low. In other words, there are high levels of demands on the person, but very little ability to control the situation, resulting in stress. The ability to control one’s job in the form of having autonomy at work regarding when and how to do one’s job, as well as the ability to shape one’s own work environment are tools to deal with stress.[11] A feeling of helplessness is an important predictor of higher stress levels. Later extensions of this theory recognized the role of social support. In addition to discretion, having a supportive manager or coworkers serves as a buffer for stress.[12] Job Demands-Resources (JD-R) Model Even though Karasek’s model has been supported by research, it is incomplete. In fact, feelings of control do not fully eliminate experienced stress: Even very high-level executives who have the ability to decide every element of their work life experience stress, so a lack of control is unlikely to be the entire explanation for why we are stressed. The JD-R model notes that every job has demands, or costly aspects. For example, the job of an assembly line worker has the demands of a fast production schedule, routine and monotonous work, physical challenges such as standing up for extended periods of time, and the danger caused by machinery. Individuals need to meet these demands, using resources available to them. In other words, stress is caused by the interaction between demands and resources, or by the mismatch between the amount and type of resources and demands. In the assembly line example, the physical and mental capabilities of the individual, the job training, and the social support available from the manager may be regarded as resources. As a result, stress can be managed by reducing job demands, increasing the resources available to the person, or both.[13] Causes of Stress at Work stressors Events or contexts that cause a stress reaction by elevating levels of adrenaline and forcing a physical or mental response. Stressors are events or contexts that cause a stress reaction by elevating levels of adrenaline and forcing a physical or mental response. The saying “the straw that broke the camel’s back” applies to stressors. Having a few stressors in our lives may not be a problem, but because stress is cumulative, having many stressors day after day can cause a buildup that becomes a problem.[14] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work 211 FIGURE 7.2 Causes of Stress at Work Role Demands and Overload Part of what causes stress at work stems from our roles. Researchers identified different types of role stressors. Role ambiguity refers to vagueness in relation to what our responsibilities are. If you have started a new job and felt unclear about what you were expected to do, you have experienced role ambiguity. Having high role ambiguity is related to higher emotional exhaustion, more thoughts of leaving an organization, and lowered job attitudes and performance.[15] Role conflict refers to facing contradictory demands at work. For example, your manager may want you to increase customer satisfaction and cut costs, while you feel that satisfying customers inevitably increases costs. In this case, you are experiencing role conflict because satisfying one demand makes it unlikely to satisfy the other. Role overload is defined as having insufficient time and resources to complete a job. When an organization downsizes, the remaining employees will have to complete the tasks that were previously performed by the laid-off workers, which often leads to role overload. Like role ambiguity, both role conflict and role overload have been shown to hurt performance and lower job attitudes; however, research shows that role ambiguity is the strongest predictor of poor performance.[16] In addition to role overload, we are constantly bombarded with information with messages reaching us in countless ways every day. Some are societal—advertisements that we may hear or see in the course of our day. Others are professional—emails, memos, voice mails, and conversations from our colleagues. Others are personal—messages and conversations from our loved ones and friends. Add these together and it’s easy to see how we may be receiving more information than we can take in. This state of imbalance is known as information overload, which can be defined as “occurring when the information processing demands on an individual’s time to perform interactions and internal calculations exceed the supply or capacity of time available for such processing.” Role overload has been made much more salient because of the ease with which we can get abundant information from Web search engines and the numerous email, social media, and text messages we receive each day. Other research shows that working in such a fragmented fashion significantly impacts efficiency, creativity, and mental acuity. In fact, the level of information overload is so pervasive that it gave rise to internet blocking productivity soft- © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. role ambiguity Vagueness in relation to our job responsibilities. role conflict Facing contradictory demands at work. role overload Having insufficient time and resources to complete one’s job. information overload Information processing demands that exceed the supply or capacity of time available for such processing. 212 Organizational Behavior ware such as Freedom, which asks you how many minutes of freedom you would like and disconnects your computer from the internet for that amount of time.[17] Work-Life Conflict work-life conflict When the demands from one’s work and other aspects of one’s life are negatively affecting one another. Work-life conflict occurs when the demands from work and non-work domains are negatively affecting one another.[18] Specifically, work and family demands on a person may be incompatible with each other such that work interferes with family life and family demands interfere with work life. This stressor has steadily increased in prevalence, as work has become more demanding and technology has allowed employees to work from home and be connected to the job around the clock. According to the Bureau of Labor Statistics, 25% of the American workforce works more than 40 hours per week. Specifically, over 8% work 41 to 48 hours per week, more than 9% work 49 to 59 hours per week, and nearly 7% work at least 60 hours per week, creating an unavoidable spillover from work to family life.[19] Moreover, the fact that more households have dual-earning families in which both adults work means household and childcare duties are no longer the sole responsibility of a stay-at-home parent. This trend only compounds stress from the workplace by leading to the spillover of family responsibilities (such as a sick child or elderly parent) to work life. Research shows that individuals who have stress in one area of their life tend to have greater stress in other parts of their lives, which can create a situation of escalating stressors.[20] Partially to help with work-life conflict, the European Union prohibits employees from working more than 48 hours per week, and countries such as Germany and France have traditionally had much lower maximums. Work-life conflict has been shown to be related to lower job and life satisfaction and it seems that work-life conflict is more problematic for women than men. Research suggests that this may partially explain women’s lower promotion rates.[21] Organizations that help their employees achieve greater work-life balance are seen as more attractive than those that do not.[22] Organizations can help employees maintain work-life balance through organizational practices such as flexibility in scheduling as well as individual practices such as having supervisors who are supportive and considerate of employees’ family life. For work-life balance, organizational support was found in a comprehensive meta-analysis to be the most important source of support.[23] Interpersonal Stressors workplace bullying Abuse and mistreatment of someone vulnerable by someone more powerful at work. Much of the stress experienced at work is due to interactions with other people. Among these, supervisors are a key source of stress. In fact, their actions or inactions are often directly responsible for creating much of the stress discussed in this chapter, such as role stressors and work-life conflict. The leadership style (such as being too controlling or too disinterested), communication style (low levels of support and interactional justice), or displays of negative styles (abusive leadership, undermining of employees, or bullying) are important stressors that could affect employee well-being. Leaders’ own stress also directly affects the stress of employees.[24] Additionally, from a survey of nearly 2,000 people, 35% indicated that the biggest source of stress at work was their boss.[25] Coworkers and customers are other individuals that can directly contribute to the experienced stress. Mistreatment from customers or coworkers and working in a toxic work environment are all important stressors. One especially problematic source of stress is workplace bullying where employees are isolated, intimidated, or threatened by others. Surveys of workers find that the negative effects of such behaviors can be long lasting.[26] Life Changes Stress can result from positive and negative life changes. Even though these changes may occur in our nonwork lives, they affect the stress level experienced by the individual, influencing workplace © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work 213 attitudes and behaviors. The Holmes-Rahe scale ascribes different stress values to life events ranging from the death of one’s spouse to receiving a ticket for a minor traffic violation. The values are based on incidences of illness and death in the 12 months after each event. On the Holmes-Rahe scale, the death of a spouse receives a stress rating of 100, getting married is seen as a midway stressful event, with a rating of 50, and losing one’s job is rated as 47. These numbers are relative values that allow us to understand the impact of different life events on our stress levels and their ability to impact our health and well-being.[27] Again, because stressors are cumulative, higher scores on the stress inventory mean you are more prone to suffering negative consequences of stress than someone with a lower score. Going through this list highlights why 2020 was such a stressful year for so many. OB Toolbox: How Stressful Is Your Life? Shutterstock.com Read each of the events on the following list. Give yourself the number of points next to any event that has occurred in your life in the last two years. There are no right or wrong answers. The aim is just to identify which of these events you have experienced. TABLE 7.1 Life Events Stress Inventory Life Event Stress Points Life Event Stress Points Death of spouse 100 Son or daughter leaving home 29 Divorce 73 Trouble with in-laws 29 Marital separation 65 Outstanding personal achievement 28 Serving a jail term 63 Spouse begins or stops work 26 Death of close family member 63 Begin or end school/ college 26 Personal injury or illness 53 Change in living conditions 25 Marriage 50 Revision of personal habits 24 Fired or laid off at work 47 Trouble with boss 23 Marital reconciliation 45 Change in work hours or conditions 20 Retirement 45 Change in residence 20 Change in health of family member 44 Change in school/ college 20 Pregnancy 40 Change in recreation 19 Sex difficulties 39 Change in church activities 19 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 214 Organizational Behavior Life Event Stress Points Life Event Stress Points Gain of a new family member 39 Change in social activities 18 Business readjustment 39 A moderate loan or mortgage 17 Change in financial state 38 Change in sleeping habits 16 Death of a close friend 37 Change in number of family get-togethers 15 Change to a different line of work 36 Change in eating habits 15 Change in number of arguments with spouse 35 Vacation 13 Large mortgage or loan 31 Christmas 12 Foreclosure of mortgage or loan 30 Minor violations of the law 11 Change in responsibilities at work 29 Source: Republished with permission of Holmes, T. H., & Rahe, R. H. (1967). The social readjustment rating scale, from Journal of Psychosomatic Research, 11, 213–218; permission conveyed through Copyright Clearance Center, Inc. Scoring: • If you scored fewer than 150 points, you have a 30% chance of developing a stressrelated illness in the near future. • If you scored between 150 and 299 points, you have a 50% chance of developing a stress-related illness in the near future. • If you scored more than 300 points, you have an 80% chance of developing a stressrelated illness in the near future. The happy events in this list such as getting married or an outstanding personal achievement illustrate how good stressors can also tax a body as much as the stressors that constitute the traditionally negative category of distress. Stressors can also occur at a larger scale. For example, during 2020, the COVID-19 global pandemic led to stressors such as unemployment, sheltering in place, closed schools, and a great deal of uncertainty that were widely held within many countries. Financial Stressors, Unemployment, and Job Insecurity Financial issues can quickly lead to stress. One major reason for financial stress is unemployment or job insecurity. Unfortunately, employee downsizing has become a common employment practice around the world. In the United States, 6.5 million jobs were downsized as a result of the 2008 recession and 1.25 million workers were affected in 2012 alone.[28] Similarly, downsizing and unemployment are becoming prevalent in countries such as Japan, Hong Kong, South Korea, and Taiwan, where employment for life had at one time been an expectation. Spain, Italy, and Ireland are struggling with employee downsizing and unemployment as well with record youth unemployment soaring. In 2020, the United States experienced record unemployment due to COVID-19. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work 215 The loss of a job can be a particularly stressful event, as you can see by its high score on the life stressors scale. It can also lead to other stressful events, such as financial problems, which can add to a person’s stress score. Research shows that downsizing and job insecurity (worrying about downsizing) are related to greater stress, alcohol use, and lower performance and creativity.[29] For example, a study of over 1,200 Finnish workers found that past downsizing or expectations of future downsizing was related to greater psychological strain and absence.[30] In another study of creativity and downsizing, researchers found that creativity and most creativity-supporting aspects of the perceived work environment declined significantly during the downsizing.[31] Those who experience layoffs but have their self-integrity affirmed through other means are less susceptible to negative outcomes.[32] Uncertainty Uncertainty can be a major stressor for people in general and especially at work. Being new can be an especially stressful time for employees starting at a new organization. Similarly, organizational change can be challenging to adapt to with changing leadership, procedures, policies, and technology, and by reorganizing, downsizing, or merging, Any of these changes are likely to be stressful for employees, as many of the other stressors we discussed earlier are likely to increase. For example, organizational change could be a time for great role ambiguity and overload. Job insecurity may increase following changes. Employees might worry about whether they will continue to perform successfully or develop or maintain effective relations with coworkers. Regardless of the exact nature of change, it is a potentially stressful reality that requires careful managing on the part of the organization. One study of more than 1,500 large Danish organizations showed that organizational change was associated with increases in prescriptions for stress-related medications.[33] Anticipatory Stress and Rumination Stress does not necessarily occur because of something that is currently happening. Instead, anticipating a bad thing happening to us can be just as stressful. Anticipatory stress refers to stress caused by visualizing events that may (or may not) happen in the future. A stressor such as job insecurity is an example of anticipatory stress—the worry that one might lose one’s job is not a certain event, but the possibility that it could happen is enough to cause stress. Much of the stress we experience is anticipatory stress: When we worry about an upcoming presentation, we are likely worrying about not being able to answer questions, technology malfunctions, being publicly criticized, or forgetting facts—which are all low-probability events if we prepared for our talk! Still, the stress experienced due to these worries is as real as if they already happened. Research shows that among highly educated German adults, life satisfaction actually drops over the weekend, due to anticipating the stresses of the following week. Another study shows that worries about being negatively judged by others during a learning task actually resulted in lower levels of learning.[34] Stress is also caused by the inability to let go of past events and obsessively thinking about them, which is known as rumination. For example, after an argument with an upset customer, thinking about what happened, reliving the entire event, or obsessively considering how one could have responded to the customer or defended oneself better are examples of ruminating. Research shows that those who ruminated about a negative customer interaction at night started the next day with a more negative mood.[35] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. anticipatory stress Stress caused by visualizing events that may (or may not) happen in the future. rumination An inability to let go of past events and obsessively thinking about them. 216 Organizational Behavior Outcomes of Stress Stress is costly for the physiological health and well-being of employees, and it translates into ineffective work behaviors such as absenteeism and turnover. A meta-analysis of the relationship between job stressors and physical symptoms found that organizational constraints, interpersonal conflict, role conflict, role ambiguity, workload, work hours, and lack of control were related to physical stress symptoms such as sleep disturbances and gastrointestinal problems.[36] In the following sections, we go into more detail regarding these relationships. Physiological Stress may manifest itself internally as nervousness, tension, headaches, anger, irritability, and fatigue. Stress can also have outward manifestations. Dr. Dean Ornish, author of Stress, Diet and Your Heart, notes that stress is related to aging.[37] Chronic stress causes the body to secrete hormones such as cortisol, which tend to make our complexion blemished and cause wrinkles. Harvard psychologist Ted Grossbart, author of Skin Deep, says, “Tens of millions of Americans suffer from skin diseases that flare up only when they’re upset.”[38] These skin problems include itching, profuse sweating, warts, hives, acne, and psoriasis. For example, Roger Smith, the former CEO of General Motors Corporation, was featured in a Fortune article that began, “His normally ruddy face is covered with a red rash, a painless but disfiguring problem, which Smith says his doctor attributes 99% to stress.”[39] The human body responds to outside calls to action by pumping more blood through our system, breathing in a more shallow fashion, and gazing wide-eyed at the world. To accomplish this feat, our bodies shut down our immune systems. As noted earlier, from a biological point of view, it’s a smart strategic move—but only in the short term. The idea can be seen as your body wanting to escape an imminent threat, so that there is still some kind of body around to get sick later. But in the long term, a body under constant stress can suppress its immune system too much, leading to health problems such as high blood pressure, ulcers, and being overly susceptible to illnesses such as the common cold. The link between heart attacks and stress, while easy to assume, has been harder to prove. The American Heart Association notes that research has yet to link the two conclusively. Regardless, it is clear that individuals under stress engage in behaviors that can lead to heart disease such as eating fatty foods, smoking, or failing to exercise. One study showed that individuals were more likely to increase their alcohol intake at night when they experienced stressful workdays, with each additional stressor increasing both the desire to consume alcohol and the amount of drinking.[40] Psychological Depression and anxiety are two psychological outcomes of unchecked stress, which are as dangerous to our mental health and welfare as heart disease, high blood pressure, and strokes. A recent study showed that of the top 10 conditions, major depression has increased the most in recent years in young people.[41] “Persistent or chronic stress has the potential to put vulnerable individuals at a substantially increased risk of depression, anxiety, and many other emotional difficulties,” notes Mayo Clinic psychiatrist Daniel Hall-Flavin. Scientists have noted that changes in brain function—especially in the areas of the hypothalamus and the pituitary gland—may play a key role in stress-induced emotional problems.[42] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work And it is estimated that 45% of mental health cases go untreated.[43] This is a major concern as stress also causes frustration and burnout—an ongoing negative emotional state resulting from dissatisfaction. Burnout is characterized by low energy and feelings of emotional exhaustion.[44] Depression, anxiety, anger, physical illness, increased drug and alcohol use, and insomnia can result from frustration and burnout, with frustration being somewhat more active and burnout being more passive. Work Outcomes Stress is related to worse job attitudes, higher turnover, and decreases in job performance in terms of both in-role performance and organizational citizenship behaviors.[45] Research also shows that stressed individuals have lower organizational commitment than those who are less stressed.[46] Not surprisingly, there is also research connecting feelings of burnout (a stress outcome) to absenteeism frequency. In a survey of more than 2,000 adults, 20% of the respondents reported taking time off from work due to stress, with half of those reporting absences of more than six days.[47] Interestingly, the connection between stress and performance is more complicated. Challenge stress, or stress that contributes to personal development such as having a high volume of highresponsibility assignments, has been found to be related to higher performance and higher levels of work engagement, perhaps with some individuals rising to the challenge.[48] The key is to keep challenges in the optimal zone for stress—the activation stage—and to avoid the exhaustion stage.[49] FIGURE 7.3 Stress and Performance Individuals who are able to find the right balance between too little and too much challenge stress see increases in performance. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 217 burnout An ongoing negative emotional state resulting from dissatisfaction. 218 Organizational Behavior Individual Differences in Experienced Stress Type A personalities Those who display high levels of speed/ impatience, job involvement, and hard-driving competitiveness. Type B personalities Those who tend to be relatively calm and tend to think through situations as opposed to reacting emotionally. workaholism The tendency to work excessively and compulsively. Psychological Capital (PsyCap) The degree to which the individual has high efficacy, optimism, hope, and resilience. How we handle stress varies by individual, and part of that issue has to do with our personality type. Type A personalities, as defined by the Jenkins Activity Survey, display high levels of speed/ impatience, job involvement, and hard-driving competitiveness.[50] If you think back to Selye’s General Adaptation Syndrome, in which unchecked stress can lead to illness over time, it’s easy to see how the fast-paced, adrenaline-pumping lifestyle of a Type A person can lead to increased stress, and research supports this view.[51] Studies show that the hostility and hyper-reactive portion of the Type A personality is a major concern in terms of stress and negative organizational outcomes.[52] Type B personalities, by contrast, are calmer by nature. They think through situations as opposed to reacting emotionally. Their fight-or-flight and stress levels are lower as a result. Our personalities are the outcome of our life experiences and, to some degree, our genetics. Some researchers believe that mothers who experience a great deal of stress during pregnancy introduce their unborn babies to high levels of the stress-related hormone cortisol in utero, predisposing their babies to a stressful life from birth.[53] Researchers also discovered that another trait that exposes individuals to stress and prevents recovery from stress is workaholism. Workaholism refers to working excessively and compulsively. Simply working long hours does not qualify someone as a workaholic. It is their attitudes toward work and not the number of hours that sets them apart. These individuals are always in a hurry, try to do multiple things at a time, and work long after their colleagues go home. Despite working so much, they feel as if they have not worked enough. In these ways, they are similar to Type A people. At the same time, workaholics feel like even when they do not necessarily enjoy working, they have to work, and feel guilty when not working. Studies have shown that workaholics experience higher levels of burnout, work-life conflict, and stress, as well as worse health outcomes.[54] Individuals also have different levels of resources to cope with stress, and as you may remember from the JD-R model, having higher levels of personal and relational resources are important for coping. Researchers have now identified Psychological Capital (PsyCap) as a personal resource that is useful for stress management. PsyCap consists of four independent traits: efficacy (the belief that one has the ability to accomplish goals), optimism (having a positive outlook toward life), hope (having goal-directed energy and changing one’s path as needed), and resilience (the ability to bounce back from negative events). Research shows that having high levels of PsyCap is related to lower levels of stress, stress symptoms, and turnover intentions.[55] OB Toolbox: To Cry or Not to Cry? That Is the Question . . . Shutterstock.com As we all know, stress can build up. Advice that’s often given is to “let it all out” with something like a cathartic “good cry.” But research shows that crying may not be as helpful as the adage would lead us to believe. In reviewing scientific studies done on crying and health, Ad Vingerhoets and Jan Scheirs found that the studies “yielded little evidence in support of the hypothesis that shedding tears improves mood or health directly, be it in the short or in the long run.” Another study found that venting actually increased the negative effects of negative emotion. Instead, laughter may be the better remedy. Crying may actually intensify the negative feelings[56] because crying is a social signal not only to others but to yourself. “You might think, ‘I didn’t think it was bothering me that much, but look at how I’m crying—I must really be upset,’” says Susan © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work Labott of the University of Toledo. The crying may make the feelings more intense. Labott and Randall Martin of Northern Illinois University at DeKalb surveyed 715 men and women and found that at comparable stress levels, criers were more depressed, anxious, hostile, and tired than those who wept less. Those who used humor were the most successful at combating stress. So, if you’re looking for a cathartic release, you might want to try to opt for humor instead: If appropriate, and possible, try to find something funny in your stressful predicament.[57] Key Takeaway Stress is prevalent in today’s workplaces. General Adaptation Syndrome, the demand-control model, and the job demands-resources model explain how and why individuals experience stress. Major stressors at work include role stressors, information overload, work-life conflict, interpersonal stressors, life changes, job insecurity and unemployment, organizational change, as well as anticipating and ruminating about stress. Outcomes of stress include both psychological and physiological problems as well as work outcomes. Individuals with Type B personalities are less prone to stress, and those who have psychological capital are more resilient. What do you think? 1. Research shows that entrepreneurs who are leading new enterprises experience low levels of stress. Why would this be true? Explain using stress models. 2. Stress can be in the form of a challenge or hindrance type of stress. Think about stressors you experienced in the past six months. Were these challenge or hindrance stress? Does this classification depend on the person? 3. What other stressors do you have experience with? Can you think of additional categories of common stressors? 7.3 Managing Stress Learning Objectives 1. Understand what individuals can do to manage their own stress. 2. Understand what organizations can do to help their employees avoid and manage stress. Individual Approaches to Managing Stress Eat Energizing Foods Greasy foods often make a person feel tired. Why? Because it takes the body longer to digest fats, which means the body is diverting blood from the brain and making you feel sluggish. Eating big, © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 219 220 Organizational Behavior heavy meals in the middle of the day may actually slow us down, because the body will be pumping blood to the stomach, away from the brain. A better choice for lunch might be fish, such as wild salmon. Fish keeps you alert because of its effect on two important brain chemicals, dopamine and norepinephrine, which produce a feeling of alertness, increased concentration, and faster reaction times. Another good source of Omega oils are nuts and seeds. Walnuts are high in Omega 3s. Cashews and sunflower seeds also contain tryptophan, which reduces stress by increasing serotonin production. Almonds contain B vitamins, which help with resilience during times of stress. In addition, research shows that Omega-3 oils help you focus and learn new information.[58] Growing research on the gut biome, which is directly linked to what is ingested, is increasingly indicating that what we eat plays a role in how we feel, our moods, and how we experience stress and emotions.[59] Get Enough Sleep Stress can make it hard to sleep. Not sleeping makes it harder to focus on work in general, as well as on specific tasks. Tired folks are more likely to lose their temper, upping the stress level of others. American insomnia is a stress-related epidemic—one-third of adults claim to have trouble sleeping and 54% admit to actually having fallen asleep while driving in the past year.[60] The average number of hours per night has been decreasing since Gallup began measuring it in 1942 when 82% reported getting 7 or more hours of sleep, which is the recommended amount of sleep.[61] Sleep is important to health as it allows your body to cognitively and physically restore itself. It also helps us reorganize and retain memories.[62] Sleeping long and well enough is related to lower stress, better attitudes at work, and higher performance.[63] In fact, research shows that for leaders, sleep deprivation makes individuals less charismatic, worse at effective decision-making, and less passionate at work.[64] The work-life crunch experienced by many Americans makes a good night’s sleep seem out of reach. According to the journal Sleep, workers who suffer from insomnia are more likely to miss work due to exhaustion. These missed days ultimately cost employers thousands of dollars per person in missed productivity each year, which can total over $100 billion across all industries. As you might imagine, a person who misses work due to exhaustion will return to work to find an even more stressful workload. This cycle can easily increase the stress level of a work team as well as the overtired individual. Get Enough Exercise Exercise is another strategy for managing stress. The best kind of break to take may be a physically active one. Research has shown that physically active breaks lead to enhanced mental concentration and decreased mental fatigue. One study, conducted by Belgian researchers, examined the effect of breaks on workers in a large manufacturing company. One-half of the workers were told to rest during their breaks. The other half did mild calisthenics. Afterward, each group was given a battery of tests. The group who had done the mild calisthenics scored far better on all measures of memory, decision-making ability, eye-hand coordination, and fine motor control.[65] Strange as it may seem, moderate amounts of exercise give us more energy. How energetic we feel depends on our maximum oxygen capacity (the total amount of oxygen we utilize from the air we breathe). The more oxygen we absorb in each breath, the more energy and stamina we will have. Yoga and meditation are other physical activities that are helpful in managing stress. Regular exercise increases our body’s ability to draw more oxygen out of the air we breathe. Therefore, taking physically active breaks may be helpful in combating stress. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work 221 Focus on Workplace Recovery Stress consumes our personal resources. Therefore, our bodies need recovery from stress to return to pre-stress levels. Experiencing too much stress without having an opportunity to recover may result in being stuck in the exhaustion phase, which may result in permanent damage on physical and mental health. Instead, if we recover, our body will return to its pre-stress levels. Psychological detachment involves leaving work at work.[66] In other words, this method of recovery requires not thinking or worrying about work until the next day, and mentally focusing on nonwork activities. You can think of this as mentally switching off. While it may take practice and removing yourself from temptations such as checking your work email, this method is quite effective in recovery. Research finds that those who regularly are able to detach from work report higher life satisfaction and lower burnout.[67] psychological detachment Leaving work at work and focusing on non-work activities. Different types of recovery opportunities range from micro breaks such as stretching every hour or taking a walk down the hall to paid sabbaticals from work, which are funded by one’s work and last several months.[68] Research finds that there are switching costs to micro breaks, which may indicate that focusing on work and then taking longer breaks is the most effective strategy.[69] Focus on Flow and Mindfulness Another way to transform stress is by breaking challenges into smaller parts, and embracing the ones that give us joy. In doing so, we can enter a state much like that of a child at play, fully focused on the task at hand, losing track of everything except our genuine connection to the challenge before us. This concept of total engagement in one’s work, or in other activities, is called flow. The term flow was coined by psychologist Mihaly Csikszentmihalyi and is defined as a state of consciousness in which a person is totally absorbed in an activity. We’ve all experienced flow: It’s the state of mind in which you feel strong, alert, and in effortless control. FIGURE 7.4 Engagement at Work A key to flow is engaging at work, yet research shows that most managers do not feel they are engaged in purposeful work. Sources: Adapted from information in Bruch, H., & Ghoshal, S. (2002, February). Beware the busy manager. Harvard Business Review, 80, 62–69; Schiuma, G., Mason, S., & Kennerley, M. (2007). Assessing energy within organizations. Measuring Business Excellence, 11, 69–78. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. flow A state of consciousness in which a person is totally absorbed in an activity. 222 Organizational Behavior According to this way of thinking, the most pleasurable way for a person to work is in harmony with his or her true interests. Work is seen as more similar to playing games than most activities adults do. This is because work consists of tasks, puzzles, surprises, and potentially rewarding challenges. By breaking down a busy workday into smaller pieces, individuals can shift from the “stress” of work to a more engaged state of flow. Designing Work That Flows Keep in mind that work that flows includes the following: • Challenge: the task is reachable but requires a stretch • Meaningfulness: the task is worthwhile or important • Competence: the task uses skills that you have • Choice: you have some say in the task and how it’s carried out[70] mindfulness Paying complete attention to one’s feelings without reaction or judgment. While not the same thing as flow, another concept is related. The most recent findings in neuroscience point to the benefits of mindfulness, which refers to paying complete attention to one’s own feelings without reaction or judgment. Experiencing this state involves experiencing the present moment without thinking about the past or future. The ability to be in the moment helps reduce the negative effects of rumination, allows one to focus, and helps with recovery following stressful events. The benefits of mindfulness-based meditation programs have been shown in populations prone to anxiety and depression. As a result, mindfulness-based meditation programs are gaining popularity as stress management tools and results are promising and that it can also help you find flow at work.[71] Psychological Coping and Optimism positive reappraisal A psychological coping technique. This method involves finding meaning in seemingly negative life events. putting into perspective Another psychological coping technique, involves minimizing the perceived importance of a situation. Individuals cope with stress in different ways, some more effectively than others. Unhealthy ways of dealing with stress include self-blame and rumination. Instead, two positive coping strategies are positive reappraisal and putting into perspective. Positive reappraisal involves finding meaning in a seemingly negative life event. An example is to think of losing one’s job as an opportunity to make a career change. Putting into perspective refers to minimizing the perceived importance of a situation. Upon losing one’s job, remembering that one’s spouse is still employed and one does not have debt is an example of putting into perspective. These two methods are thought to be useful stress management techniques and facilitate recovery.[72] In addition, meta-analytic summaries of research show that optimists, people who tend to do these things, have a 35% less chance of having a heart attack or stroke and that they are more likely to eat well and exercise regularly.[73] This is probably a big reason why they seem to have stronger immune systems and to live longer. A study found that people with the most positive outlook enjoyed an 11% to 15% longer lifespan and had the greatest odds of living to 85 or beyond.[74] Create a Social Support Network A consistent finding is that those individuals who have a strong social support network are less stressed than those who do not.[75] Research finds that social support can buffer the effects of stress.[76] Individuals can help build up social support by encouraging a team atmosphere in which coworkers support one another. Just being able to talk with and listen to others, either with coworkers at work or with friends and family at home, can help decrease stress levels. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work 223 Time Management Time management is defined as the development of tools or techniques that help to make us more productive when we work. Effective time management is a major factor in reducing stress, because it decreases much of the pressure we feel. With information and role overload it is easy to fall into bad habits of simply reacting to unexpected situations. Understanding how you spend your day can be helpful in changing poor time management habits. For example, recent research shows that knowledge workers may only be productive a total of two days each week and spend, on average, nearly 4 1/2 hours per week solely on doing work that has already been done by somebody else.[77] Time management techniques include prioritizing, manageable organization, and keeping a schedule such as a paper or electronic organizing tool. Just like any new skill, developing time management takes conscious effort, but the gains might be worthwhile if your stress level is reduced. A very poor way of managing your time is procrastination. Chronic procrastinators postpone doing important tasks, knowing that they will experience problems later. Research among college students showed that procrastinators experienced lower levels of stress early in the term, but later in the term had higher levels of stress, were more likely to get sick, and had more frequent doctor visits.[78] There are many tools available to help you use your time more wisely. Organizational Approaches to Managing Stress Stress-related issues cost businesses billions of dollars per year in absenteeism, accidents, and lost productivity.[79] As a result, managing employee stress is an important concern for organizations as well as individuals. For example, Renault, the French automaker, invites consultants to train their supervisors to avoid the outcomes of negative stress for themselves and their subordinates. IBM Corporation encourages its worldwide employees to take an online stress assessment that helps them create action plans based on their results. Even organizations such as General Electric Company (GE) that are known for a “winner takes all” mentality are seeing the need to reduce stress. GE has brought in comedians to lighten up the workplace atmosphere, and those receiving low performance ratings are no longer called the “bottom 10s” but are now referred to as the “less effectives.”[80] Organizations can take many steps to helping employees with stress. The first step in stress management is always dealing with the source of stress and ensuring that individual exposure to stress is limited. Some stressors need to be eliminated. For example, if managers and coworkers are creating a toxic work environment, this problem needs to be solved. When it is not possible to eliminate the stressor or limit the individual’s exposure, then the organization will need to increase the resources available to employees to help them cope with stress better. Different stressors require different solutions. In this section, we will review some best practices. Give Employees Autonomy Giving employees a sense of autonomy is another thing that organizations can do to help relieve stress.[81] It has long been known that one of the most stressful things that individuals deal with is a lack of control over their environment. Research shows that individuals who feel a greater sense of control at work deal with stress more effectively both in the United States and in Hong Kong.[82] Similarly, in a study of American and French employees, researchers found that the negative effects of emotional labor were much less for those employees with the autonomy to customize their work environment and customer service encounters.[83] Employees’ stress levels are likely to be related to the degree that organizations can build autonomy and support into jobs. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. time management Development of tools or techniques that help to make us more productive when we work. procrastination Postponing doing important tasks, even knowing that you will experience problems later. 224 Organizational Behavior Create Fair Work Environments Work environments that are unfair and unpredictable have been labeled “toxic workplaces.” A toxic workplace is one in which a company does not value its employees or treat them fairly.[84] Statistically, organizations that value employees are more profitable than those that do not.[85] Research shows that working in an environment that is seen as fair helps to buffer the effects of stress.[86] This reduced stress may be because employees feel a greater sense of status and self-esteem or due to a greater sense of trust within the organization. These findings hold for outcomes individuals receive as well as the process for distributing those outcomes.[87] Whatever the case, it is clear that organizations have many reasons to create work environments characterized by fairness, including lower stress levels for employees. In fact, one study showed that training supervisors to be more interpersonally sensitive even helped nurses feel less stressed about a pay cut.[88] Supervisor Support: Work-Life Conflict Survey Think of your current or most recent supervisor and rate each of the following items in terms of this person’s behavior toward you. Answer the following questions using 1 = not at all, 2 = somewhat, 3 = fully agree 1. _____ My supervisor is willing to listen to my problems in juggling work and nonwork life. 2. _____ My supervisor takes the time to learn about my personal needs. 3. _____ My supervisor makes me feel comfortable talking to him or her about my conflicts between work and nonwork. 4. _____ My supervisor and I can talk effectively to solve conflicts between work and nonwork issues. 5. _____ I can depend on my supervisor to help me with scheduling conflicts if I need it. 6. _____ I can rely on my supervisor to make sure my work responsibilities are handled when I have unanticipated nonwork demands. 7. _____ My supervisor works effectively with workers to creatively solve conflicts between work and nonwork. 8. _____ My supervisor is a good role model for work and nonwork balance. 9. _____ My supervisor demonstrates effective behaviors in how to juggle work and nonwork balance. 10. _____ My supervisor demonstrates how a person can jointly be successful on and off the job. 11. _____ My supervisor thinks about how the work in my department can be organized to jointly benefit employees and the company. 12. _____ My supervisor asks for suggestions to make it easier for employees to balance work and nonwork demands. 13. _____ My supervisor is creative in reallocating job duties to help my department work better as a team. 14. _____ My supervisor is able to manage the department as a whole team to enable everyone’s needs to be met. Add up all your ratings to see how your supervisor stacks up. Score total = _______________ Scoring Scoring: • A score of 14 to 23 indicates low levels of supervisor support. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work 225 • A score of 24 to 33 indicates average levels of supervisor support. • A score of 34 to 42 indicates high levels of supervisor support. Adapted from Hammer, L. B., Kossek, E. E., Yragui, N. L., Bodner, T. E., & Hanson, G. C. (2009). Development and validation of a multidimensional measure of family supportive supervisor behaviors (FSSB). Journal of Management, 35, 837–856. DOI: 10.1177/0149206308328510. Used by permission of Sage Publications. Provide Social Support Social support can be an individual or organizational strategy. Individuals can reach out to others to have a connection, but organizations can also facilitate relationship development and camaraderie. Having a supportive manager is perhaps the key resource when it comes to dealing with work-related stress, so the careful selection and training of managers is an effective stress management technique. A group that is particularly at risk, and therefore can benefit more from social support, is new employees. Realizing that new employees are particularly prone to stress and are unlikely to quickly build relations with others at work, Hyatt hotels initiated the Ambassador program, matching each newcomer to a colleague who can show them the ropes.[89] Workplace loneliness is also an increasing challenge.[90] Loneliness , defined as a complex set of feelings that occurs when social needs are not met, has been shown to be related to lower performance and worse emotional outcomes.[91] Ensuring a culture of inclusivity where all employees feel important and valued is one way that organizations may help employees feel less lonely. social support Providing assistance or comfort to other people to help them cope. loneliness A complex set of feelings that occurs when social needs are not met. Offer Flexible Schedules Organizations have opportunities to offer schedules that allow employees flexibility in when and where work is conducted. These schedules allow employees to achieve a greater balance between their work and personal lives and offer a sense of autonomy. Flextime gives employees flexibility in when to complete their work. In some organizations, flextime schedules require that every employee works during core hours (e.g., 11am to 3pm) while choosing their start and end times (7am to 3pm or 11am to 7pm). A compressed workweek consists of working a 40-hour week in less than 5 days, such as allowing employees to work 10 hours a day for four days and taking the fifth day off. Job sharing divides one full-time job between two employees, allowing each person to work a parttime schedule. These schedules may be particularly appealing to working parents or students who need more flexibility than what a 9am–5pm schedule may offer.[92] flextime A schedule that allows employees flexibility in when to complete their work. compressed workweek A schedule that allows employees to work 40 hours in less than five days. job sharing A work arrangement that divides one full-time job between two employees. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 226 Organizational Behavior Telecommuting helps employees avoid traffic jams like this one. However, while millions have the option to work from home, more than 80% of U.S. residents were still driving to work prior to the COVID-19 pandemic. Shutterstock.com telecommuting Working remotely such as from home or from a coffee shop for some portion of the workweek. Telecommuting refers to working remotely. For example, some employees work from home, a remote satellite office, or from a coffee shop for some portion of the workweek. Being able to work away from the office is one option that can decrease stress for some employees. Of course, while almost 2/3 of workers in the United States telecommute at least part of the time each year, telecommuting is not for everyone.[93] At Merrill Lynch & Co. Inc., those who are interested in telecommuting are put through a rigorous training program that includes two weeks in one of their three home office simulation labs in Florida, New Jersey, or Manhattan to see if telecommuting is a good fit for the employee. Employees must also submit photos of their home office and a work plan.[94] AT&T Inc., which also has a formal training program for telecommuters, estimates that it saves upwards of $30 million by allowing employees to work remotely.[95] A recent survey found that 43% of government workers were eligible to telecommute. This trend has been growing in reaction to a law passed by the U.S. Congress in 2000 requiring federal agencies to offer working from home as an option.[96] Merrill Lynch has seen higher productivity, less stress, lower turnover, and higher job satisfaction for those who telecommute.[97] Similarly, a study of a Chinese call center employees found that telecommuters upped their productivity by 13%, raised their work satisfaction by 50%, and lowered their turnover by 50%.[98] A recent summary of all the studies of telecommuting covering thousands of employees confirmed researcher findings that the higher autonomy of working from home resulted in lower work-family conflict for these employees. Even more encouraging were the findings of higher job satisfaction, better performance, and lower stress as well.[99] Of course, telecommuting can also cause potential stress. The keys to successful telecommuting arrangements are to match the right employees with the right jobs to the right environments. If any variable is not within a reasonable range, such as having a dog that barks all day when the employee is at home, productivity will suffer. Training Job-related training is useful to build feelings of efficacy. Some types of jobs are inherently stressful, such as jobs involving physical danger, including firefighters and police officers. Training them in how best to perform their jobs prevents them from experiencing unnecessary levels of stress by making them more capable. In addition to teaching employees how to perform their jobs, some training programs aim at building resilience. For example, the U.S. Navy teaches new recruits how to move beyond their automatic fear responses by immunizing them against danger. Even though they face some of the toughest conditions among military groups, Navy Seals, the principal Special Operations force of the U.S. Navy, experience lower levels of stress. This is in no small part thanks to their training in resilience, immunizing them against fear responses.[100] Other jobs such as airline pilots and astronauts engage in the extensive use of simulations to train for stressful, dangerous situations. Such simulations allow them to gain experience in a safe, feedback-rich environment. Employee Sabbaticals Sabbaticals (paid time off from the normal routine at work) have long been a sacred ritual practiced by universities to help faculty stay current, work on large research projects, and recharge every five to eight years. However, many companies such as Genentech Inc., Adobe Systems, and REI are now in the practice of granting paid sabbaticals to their employees. For example, if you work for Intel for seven years, you are eligible for an 8-week sabbatical that comes with full pay. This is in addition to regular vacation time.[101] Paid sabbaticals are not the norm. A recent study by the Society for Human Resource Management showed that only 5% of employers in the U.S. offered paid sabbatical leave.[102] However rare, such programs can help employees relax. For example, at PwC, you can apply for a sabbatical after just two years on the job if you agree to stay with the company for at least one year following your break. Time off ranges from a few weeks to six months and entails either a personal growth plan or one for social services where you help others.[103] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work 227 Employee Assistance Programs There are times when life outside work causes stress in ways that will impact our lives at work and beyond. These situations may include the death of a loved one, serious illness, drug and alcohol dependencies, depression, or legal or financial problems that are impinging on our work lives. Although treating such stressors is beyond the scope of an organization or a manager, many companies offer their employees outside sources of emotional counseling. Employee Assistance Programs (EAPs) are often offered to workers as an adjunct to a company-provided health-care plan. Small companies in particular use outside employee assistance programs, because they don’t have the needed expertise in-house. As their name implies, EAPs offer help in dealing with crises in the workplace and beyond. EAPs are often used to help workers who have substance abuse problems. Employee Assistance Programs (EAPs) Programs that provide support to employees to help them deal with personal problems that can affect performance, health, and well-being. Wellness Programs Corporate wellness programs are designed to promote employees’ engagement in behaviors that have been shown to improve overall health. These programs may include gym memberships, free health screenings, weight loss programs, improving sleep habits, and smoking cessation programs. This might include amenities such as installing mediation or nap rooms. Many of these programs offer financial incentives to stay healthy, while others have penalties for not participating. Research has shown that for every dollar spent on wellness programs, medical costs fall by $3.27 and absenteeism costs fall by $2.73, making these programs a good investment.[104] Some organizations take things even further and work on wellness at the point of hire. For example, U-Haul is a company with 30,000 employees in the United States and Canada. They will no longer hire someone in 21 states if they use nicotine. Jessica Lopez, U-Haul’s chief of staff said the following regarding this policy, “Nicotine products are addictive and pose a variety of serious health risks. This policy is a responsible step in fostering a culture of wellness at U-Haul, with the goal of helping our team members on their health journey.”[105] Key Takeaway There are many individual and organizational approaches to decreasing stress and avoiding negative outcomes. Individuals can control their diet, exercise, and sleep routines; build a social support network; and practice better time management. Organizations can give employees autonomy, facilitate social support, create fair work environments, consider telecommuting, give employee sabbaticals, and utilize employee assistance programs. What do you think? 1. Have you ever been in a state of “flow” as described in this section? If so, what was special about this time? 2. Whose responsibility do you think it is to deal with employee stress—the employee or the organization? Why? 3. Do you think most organizations are fair or unfair? Explain your answer. 4. Have you ever considered telecommuting? What do you think would be the pros and cons for you personally? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. wellness programs Employer-sponsored offerings that support and promote employee health. 228 Organizational Behavior 7.4 What Are Emotions? Learning Objectives 1. Understand what defines emotions. 2. Identify the different types of emotions people experience. 3. Understand emotion contagion. Types of Emotions emotion Feeling that occurs quickly and profoundly in response to an event that is desired (positive) or undesired (negative). positive emotions Emotions such as joy, love, and surprise that can result from desired events. Research shows that acting positive at work can actually help you become happier over time, as emotions can be influenced by actions. Shutterstock.com negative emotions Emotions such as anger, fear, and sadness that can result from undesired events. An emotion is defined as a short, intense feeling resulting from some event. In a typical day, we experience a range of emotions: anger, disgust, fear, happiness, sadness, and surprise are emotions that are experienced by all human beings. Emotions drive our behavior, color our judgment, and shape our day-to-day experiences. Not everyone reacts to the same situation in the same way. For example, a manager’s way of speaking can cause one person to feel motivated, another to feel angry, and a third to feel sad. Emotions can influence whether a person is receptive to advice, whether they quit a job, and how they perform individually or on a team.[106] Of course, as you know, emotions can be positive or negative. Positive emotions such as joy, love, and surprise result from our reaction to desired events. In the workplace, these events may include achieving a goal or receiving praise from a superior. Individuals experiencing a positive emotion may feel peaceful, content, and calm. Positive feelings have been shown to dispose a person to optimism, and a positive emotional state can make difficult challenges feel more achievable.[107] This is because being positive can lead to upward positive spirals where your good mood brings about positive outcomes, thereby reinforcing the good mood.[108] Positive emotions are also useful for creative tasks, because positive individuals tend to be more creative and open to new ideas. In addition to helping with employee creativity, companies such as Microsoft Corporation often want to understand which features of their products produce not just high ratings for usability but also high emotional ratings. Individuals with strong positive emotional reactions are more likely to use their product and recommend it to others.[109] This is something Apple Inc. has been known for doing well, as their products tend to evoke strong positive emotions and loyalty from their users. In fact, by creating products that users feel an emotional reaction to, Apple has revolutionized the way entertainment content is experienced. Negative emotions such as anger, fear, and sadness can result from undesired events. In the workplace, these events may include not having your opinions heard, a lack of control over your day-to-day environment, and unpleasant interactions with colleagues, customers, and superiors. Negative emotions play a role in the conflict process, with those who can manage their negative emotions finding themselves in fewer conflicts than those who do not. The unwanted side effects of negative emotions at work are easy to see: An angry colleague is left alone to work through the anger; a jealous colleague is excluded from office gossip, which is also the source of important office news. We also know that negative emotions are related to counterproductive work behaviors in general. Further, negative emotions color our perception, and therefore the same event such as being cut off in traffic will be more frustrating if we are already in a negative mood. Negative emotions even shape what we hear: In an experiment, participants who first listened to sad music (Barber’s Adagio for Strings, for those of you classically inclined) were more likely to hear the words “mourning” rather than “morning” and heard “die” rather than © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work “dye” compared to subjects who first listened to the happier Eine Kleine Nacht Music by Mozart.[110] But there is a bright side to negative emotions as well. Research shows that people experiencing negative emotions are less likely to be deceived—so negativity may bring in some healthy skepticism to a topic.[111] The key is to promote the positive emotions and work to manage the negative ones so they don’t spread throughout the organization and become the norm. Emotional Contagion Both positive and negative emotions can be contagious, with the spillover of negative emotions lasting longer than positive emotions.[112] As you may have experienced in the past, contagion can be especially salient in a team setting. Research shows that emotions are contagious and that team members affect one another.[113] One explanation for negative emotions’ tendency to linger may be a stronger connection to the fight-or-flight situations people experience. Anger, fear, and suspicion are intentionally unpleasant messages urging us to take action immediately. To make sure we get the message, these emotions stick around. Research shows that some people are more susceptible to emotional contagion than others.[114] But in general, when the boss is happy, the staff is happy.[115] And when employees such as bank tellers are in a positive mood, customers are as well, which in turn affects the employees’ mood, creating a cycle of positive emotions.[116] We can also imagine how negative emotions can be transferred. Imagine you’re working behind the counter at a fast-food restaurant. Your mood is fine, until a customer argues with you about an order. You argue back. The customer leaves in a huff. Your anger emotions continue, turning into negative feelings that last throughout the day. As you might guess, you are more likely to make mistakes and find ordinary challenges annoying when you’re experiencing negative emotions. Unchecked, your negative emotions can spread to those around you. A negative interaction with one customer can spill over into interactions with another customer.[117] OB Toolbox: Practice Changing Your Emotions Shutterstock.com Olympic athletes train for peak performance by stimulating their brains to believe they’ve just run a record race. You can do the same thing to experience different moods. By providing your brain with the external stimulus of happiness or sadness, you can create those feelings. Give it a try! It’s best to practice this when you are feeling relatively calm. To give yourself a neutral starting point, close your eyes and breathe in slowly. Now, release your breath. Open your eyes and smile wide. Allow your eyes to crinkle. Now smile a bit more. The changes you have consciously made to your expression are signaling your body that a positive event has taken place. How does this affect you emotionally? Answer these questions to find out: • Do you feel more or less energetic as you smile? • More or less calm? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 229 230 Organizational Behavior • More or less optimistic? • How does the feeling resulting from your physical changes compare with your feelings a moment before? Now, let’s try the opposite: Close your eyes and breathe in and out slowly, as detailed above, to clear your “emotional slate.” Then open your eyes. Pull down the corners of your mouth. Open your eyes wide. You have just signaled to your body that something negative has taken place. Note your feelings using the list above. How do these feelings compare with your feelings of “intentional happiness”? Now consider this: Dr. Aston Trice of Mary Baldwin College in Virginia found that humor has mood-altering effects. Subjects were given a frustrating task. Then, one-half were shown cartoons. Those who had seen the cartoons overcame their frustration and attacked a new test with renewed enthusiasm and confidence, compared to those subjects who hadn’t had the humorous interlude.[118] Key Takeaway Emotions serve many purposes and affect people at work. There are positive and negative emotions, and both can be helpful at motivating us to work harder. Emotions are malleable and they can also be contagious. What do you think? 1. How easy do you think it is to “manage” one’s emotions? 2. Which types of emotions are most socially accepted in the workplace? Why do you think this is? 3. What are factors that affect your emotions? 4. Share an example of either positive or negative emotional contagion. How did it start and stop? 5. What do you do, if anything, to try to change how you are feeling? How effective are your strategies? 7.5 Emotions at Work Learning Objectives 1. Understand Affective Events Theory. 2. Understand the influence of emotions on attitudes and behaviors at work. 3. Learn what emotional labor is and how it affects individuals. 4. Learn what emotional intelligence is. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work 231 Emotions Affect Attitudes and Behaviors at Work Emotions are typically accompanied by physiological and behavioral changes in the body. Emotions shape an individual’s belief about the value of a job, a company, or a team. Emotions also affect behaviors at work. Research shows that individuals within your own inner circle are better able to recognize and understand your emotions.[119] All of this indicates how important the concept of emotions are for work. So, what is the connection between emotions, attitudes, and behaviors at work? This connecAffective Events Theory (AET) tion may be explained using a theory named Affective Events Theory (AET). Researchers Howard Weiss and Russell Cropanzano studied the effect of six major kinds of emotions in the workplace: A theory that explores how events on the job cause anger, fear, joy, love, sadness, and surprise.[120] Their theory argues that specific events on the job different kinds of people to cause different kinds of people to feel different emotions. These emotions, and related emotions feel different emotions. [121] such as envy, in turn, may inspire actions that may serve to benefit or impede others at work. For example, imagine that a coworker unexpectedly delivers your morning FIGURE 7.5 Emotions at Work coffee to your desk. As a result of this pleasant, if unexpected, experience, you may feel happy and surprised. If that coworker is your manager, you might feel proud as well. Studies have found that the positive feelings resulting from work experience may inspire you to do something you hadn’t planned to do before. For instance, you might volunteer to help a colleague on a project you weren’t planning to work on before. Your action would be an affect-driven behavior.[122] Alternatively, if you were unfairly reprimanded by your manager, the negative emotions you experience may cause you to withdraw from work or to act mean toward a coworker. Over time, these tiny moments of emotion on the job can influence a person’s job satisfaction and performance. Although company perks and promotions can contribute to a person’s happiness at work, satisfaction is not simply a result of this kind of “outside-in” reward system. Job satisfaction in the AET model comes from the inside-in—from the combination of an individual’s personality, small emotional experiences at work over time, beliefs, and affect-driven behaviors. According to Affective Events Theory, six emotions are affected by events at work. affect-driven behavior Behavior that occurs when emotions trigger you to respond in a particular way. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 232 Organizational Behavior Research on emotions sometimes uses faces such as these to determine how well individuals can detect distinct emotions. Research on emotions has made strides in determining many things. For a long time, it was well accepted that there are universal emotions (happiness, surprise, fear, disgust, anger, and sadness), which are expressed using the same facial movements across all cultures that are detectable by watching the faces of individuals. This was based on Paul Ekman’s anthropological research.[123] However, more recent research has called the universality of his findings into question.[124] Regardless, research on emotions at work has continued to gain popularity and prevalence in organizational behavior. Emotional Labor Shutterstock.com persona A professional role that involves acting out potentially artificial feelings as part of a job. emotional labor The regulation of feelings and expressions for organizational purposes. surface acting Behavior requiring individuals to exhibit physical signs, such as smiles, that reflect emotions they don’t feel. deep acting Behavior requiring an individual to try to experience the emotions they are displaying. genuine acting Negative emotions are common among workers in service industries. Part of a service employee’s job is projecting a certain image in the eyes of the public. Individuals in service industries are professional helpers. As such, they are expected to be upbeat, friendly, and polite at all times, which can be exhausting to accomplish in the long run. Even when they are having a bad day, they are expected to provide "service with a smile." The result is a persona—a professional role that involves acting out feelings that may not be real as part of their job. Emotional labor refers to the regulation of feelings and expressions for organizational purposes.[125] Three major levels of emotional labor have been identified and are unique but interrelated.[126] 1. Surface acting requires an individual to exhibit physical signs, such as smiling, that reflect emotions customers want to experience. A children’s hairdresser cutting the hair of a crying toddler may smile and act sympathetic without actually feeling so. In this case, the person is engaged in surface acting. 2. Deep acting takes surface acting one step further. This time, instead of faking an emotion that a customer may want to see, an employee will actively try to experience the emotion they are displaying. This genuine attempt at empathy helps align the emotions one is experiencing with the emotions one is displaying. The children’s hairdresser may empathize with the toddler by imagining how stressful it must be for one so little to be constrained in a chair and be in an unfamiliar environment, and the hairdresser may genuinely begin to feel sad for the child. 3. Genuine acting occurs when individuals are asked to display emotions that are aligned with their own. If a job requires genuine acting, less emotional labor is required because the actions are consistent with true feelings. Behavior requiring an individual to display emotions aligned with their own. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work Research shows that surface acting is related to higher levels of stress and fewer felt positive emotions, while deep acting may lead to less stress.[127] Emotional labor is particularly common in service industries that are also characterized by relatively low pay, which creates the added potentials for stress and feelings of being treated unfairly.[128] Emotional laborers are required to display specific emotions as part of their jobs. Sometimes, these are emotions that the worker already feels. In that case, the strain of the emotional labor is minimal. For example, a funeral home director is generally expected to display sympathy for a family’s loss, and it is likely that this emotion will be genuine. But for people whose jobs require them to be professionally polite and cheerful, such as flight attendants, or to be serious and authoritative, such as police officers, the work of wearing one’s “game face” can have effects that outlast the working day. To combat this, taking breaks can help surface actors to cope more effectively.[129] In addition, researchers have found that greater autonomy is related to less strain for service workers in France as well as the United Sates. Research even shows that for some, meetings are a source of emotional labor, especially when higher status individuals are in attendance.[130] For people who have a strong desire to be authentic (being true to themselves) in their interactions, faking one’s emotions was related to worse well-being.[131] 233 FIGURE 7.6 Emotional Labor at Work When it comes to acting, the closer to the middle of the circle that your actions are, the less emotional labor your job demands. The further away, the more emotional labor the job demands. Cognitive dissonance is a term that refers to a mismatch among emotions, attitudes, beliefs, and behavior, for example, believing that you should always be polite to a customer regardless of personal feelings, yet having just been rude to one. You’ll experience discomfort or stress unless you find a way to alleviate the dissonance. You can reduce the personal conflict by changing your behavior (trying harder to act polite), changing your belief (maybe it’s OK to be a little less polite sometimes), or by adding a new fact that changes the importance of the previous facts (such as you will otherwise be laid off the next day). Although acting positive can make a person feel positive, emotional labor that involves a large degree of emotional or cognitive dissonance can be grueling, sometimes leading to negative health effects.[132] cognitive dissonance A term that refers to a mismatch among emotions, attitudes, beliefs, and behavior. Emotional Intelligence One way to manage the effects of emotional labor is by increasing your awareness of the gaps between real emotions and emotions that are required by your professional persona. “What am I feeling? And what do others feel?” These questions form the heart of emotional intelligence. The term was coined by psychologists Peter Salovey and John Mayer and was popularized by psychologist Daniel Goleman in a book of the same name. Emotional intelligence looks at how people can understand each other more completely by developing an increased awareness of their own and others’ emotions.[133] There are four building blocks involved in developing a high level of emotional intelligence. Self-awareness exists when you are able to accurately perceive, evaluate, and display appropriate emotions. Self-management exists when you are able to direct your emotions in a positive way when needed. Social awareness exists when you are able to understand how others feel. Relationship management exists when you are able to help others manage their own emotions and truly establish supportive relationships with others [134] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. emotional intelligence The ability to understand others more completely by becoming more aware of one's own and others' emotions. 234 Organizational Behavior FIGURE 7.7 Emotional Intelligence The four steps of emotional intelligence build upon one another. Research on team functioning finds that self-awareness helps team-level functioning and performance. Across 500 teams and 2,600 individuals, one study found that teams with more members who were self-aware were more effective.[135] In other areas of the workplace, those high in emotional intelligence have been found to have higher self-efficacy in coping with adversity, perceive situations as challenges rather than threats, and to have higher job and life satisfaction, which can all help lower stress levels.[136] Journaling journaling The process of writing out thoughts and emotions on a regular basis. One way to help manage your stress is to get more in touch with your emotions. Once you are better able to recognize your emotions, you are better able to manage them rather than being unconsciously influenced by them. For example, you might realize that you are happier in your job than you originally thought when you record and reflect on your emotions. Or, you might realize just the opposite. Either way, journaling can help you chart your feelings over time and help you realize how much progress you are making as you learn new skills over time. For more on this, see the following OB toolbox. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work OB Toolbox: Journaling as a Developmental Tool Shutterstock.com • What exactly is journaling? Journaling refers to the process of writing out thoughts and emotions on a regular basis. • Why is journaling a good idea? Journaling is an effective way to record how you are feeling from day to day. It can be a more objective way to view trends in your thoughts and emotions so you are not simply relying on your memory of past events, which can be inaccurate. Simply getting your thoughts and ideas down has been shown to have health benefits as well, such as lowering the writer’s blood pressure and heart rate, and decreasing stress levels.[137] • Suggestions for getting started. The first step is to get a journal or create a computer file where you can add new entries on a regular basis. Set a goal for how many minutes per day you want to write and stick to it. Experts say at least 10 minutes a day is needed to see benefits, with 20 minutes being ideal. The quality of what you write is also important. Write your thoughts down clearly and specifically while also conveying your emotions in your writing. After you have been writing for at least a week, go back and examine what you have written. Do you see patterns in your interactions with others? Do you see things you like and things you’d like to change about yourself? If so, great! These are the things you can work and reflect on. Over time, you will also be able to track changes in yourself, which can be motivating as well. Key Takeaway Emotions affect attitudes and behaviors at work. Affective Events Theory can help explain these relationships. Emotional labor is higher when one is asked to act in a way that is inconsistent with personal feelings. Surface acting requires a high level of emotional labor. Emotional intelligence refers to understanding how others are reacting to our emotions. What do you think? 1. What is the worst job you have ever had (or class project if you haven’t worked)? Did the job require emotional labor? If so, how did you deal with it? 2. Research shows that acting “happy” when you are not can be exhausting. Why do you think that is? Have you ever felt that way? What can you do to lessen these feelings? 3. How important do you think emotional intelligence is at work? Why? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 235 236 Organizational Behavior 7.6 Focus on Stress, Emotions, and Ethics Learning Objectives 1. Consider the role of emotion for ethics. 2. Consider the role of technology for stress and emotions. 3. Consider the role of national culture on stress and emotions. Stress and Emotions and Ethics We have seen before how a gap between our true feelings and the feelings we display at work can cause distress. What happens when there is a gap between our feelings and our true beliefs? Shutterstock.com Joshua Greene is a philosopher and neuroscientist who uses magnetic imaging of the brain to show how our minds and bodies react to difficult questions. In one example, Greene asked a group of subjects to consider a situation in which a trolley is racing down a track, about to kill five people. The subjects have the ability to steer the trolley onto another track, where it will kill only one person. Most agree this feels like the right thing to do—the best of possible evils. Greene then asks his subject to consider the same situation with one major shift: In this case, to save the five bystanders the subject must push a large man in front of the trolley to stop it in its tracks. This time, Greene’s subjects felt the sacrifice was emotionally wrong. Greene’s research shows that the difference between his subjects’ valuations of life in these cases was that the second was more emotional. The thought of pushing someone to his death, understandably, had brought up strong feelings among the group. If humans were computers, one person’s death might be seen as “less bad” than the death of five. But human decisions are based on emotion. It was considered emotionally—and therefore, morally—unacceptable to push the man in front of the trolley to save five others. Greene’s magnetic images of his subject’s brains showed that while considering the second scenario, people were using more of their brains. Greene writes, “These differences in emotional engagement affect people’s judgments.”[138] Emotions are a powerful force in work and life. They are spontaneous and unpredictable elements of human beings that separate us from machines, and in some moments, from one another. By learning to identify and maximize the uses of our emotions at work, we can more appropriately respond to emotional situations. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work 237 Stress, Emotions, and Technology Working from home can be a way to reduce stress as it has the potential to help reduce work-family conflict by lowering the time spent commuting and avoiding distractions at work. However, it can also be more stressful as family distractions may be higher. Working remotely has become more and more common and learning to manage stress and one’s emotions when doing so has become especially important as technology has made it easier for us to engage with others without being in the same room as them. Researchers suggest that to avoid problems when using technology you may consider the following:[139] Shutterstock.com 1. Emotionally proofread your messages. In person it is much easier to pick up on emotions via tone and context and the ability to ask questions in real time. With email, however, that isn’t possible. So, be sure to read and re-read your messages with the receiver in mind. If you think they might be able to misinterpret your message, consider editing it. 2. Be mindful of time zones. It is easy to forget about time zones as you are working, but given how dispersed work teams have become, it is important to do so. One way to avoid sending emails at off-hours is to schedule them using email scheduling programs. 3. Schedule time to collaborate with others. Many breakthroughs and innovations have happened by accident when coworkers were chatting around the office water cooler or during lunch at work. When working remotely, it is still important to schedule time for informal chatting before or after meetings or even just as a way to keep up with one another. Some organizations even use technology to randomly pair up employees to connect with one another with no set agenda. 4. Make room for breaks and micro-breaks. This is critical for both physical and mental health. Research shows that taking breaks lowers stress and enhances performance at work. When possible, take longer, more restorative breaks. 5. Create routines and set up an after-work ritual. Doing so can help you transition from work to your personal life. This is a good practice no matter where you are working but it is especially important when working from home as it can be easy to keep working and let boundaries blur. 6. Schedule specific times on your calendar to exercise. As you saw in this chapter, exercise is an effective way to reduce stress, enhance your mood, and help you regulate your emotions. 7. Manage your information intake. As we saw in this chapter, information overload is a common stressor. By managing your information intake, you can help avoid becoming overwhelmed. Stress and Emotions Around the Globe As economist Steven Landsburg notes, “Compared with Europeans, Americans are more likely to be employed and more likely to work longer hours—employed Americans put in about three hours more per week than employed Frenchmen. More important, Americans take fewer (and shorter) vacations.”[140] That is, if they take a vacation at all. Research finds that over 50% of workers in the U.S. have unused vacation time at the end of the year, resulting in a staggering 705 million unused vacation days. Some of the top reasons for this phenomenon include a fear of appearing replaceable and heavy workloads.[141] Juliet Schor, a senior lecturer in economics and director of women’s studies at Harvard University, adds to the portrait of the overworked American with a shocking statistic on Americans’ free time. According to Schor’s book, The Overworked American: The Unexpected Decline of Leisure, Americans have 16.5 hours per week of leisure time after their work and household obligations are fulfilled.[142] This is a huge concern, as research has established that recovery is a key to well-being and that the lack of recovery can lead to health concerns associated with stress.[143] Even more chal- © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Shutterstock.com 238 Organizational Behavior lenged for leisure time are some Mexican employees, working an average of 388 more hours per year than their American counterparts and 785 more hours than employees in Germany.[144] Leisure and recovery are key aspects to remaining healthy throughout one’s lifetime. While Europeans normally plan on taking the month of August off, Americans do not have a similar ritual. PwC became so concerned that they have instituted a 10-day shutdown as a winter break and a five-day shutdown around July 4 so that everyone takes that time off without feeling peer pressure to work through vacations. Are there differences in the emotions experienced around the world? Paul Ekman, the American psychologist who is famous for being the best “human lie detector” and whose work has been the basis of the TV series Lie to Me devoted his career to studying this question. This line of research suggested that basic emotions are experienced around the globe, and they are recognizable through facial expressions. For example, in his research on Papua New Guinea tribes, who were not exposed to popular media, tribesmen were able to match emotions to correct facial expressions. In recent work, his research showed that Western subjects and subjects in isolated Namibian villages were able to identify the correct emotions when they listened to vocalizations of basic emotions.[145] Despite similarities in how emotions are experienced, there are actually significant differences in felt and expressed emotions. For example, research has shown that it is more appropriate to express emotions outwardly in individualistic cultures as opposed to collectivistic cultures. In fact, in individualistic cultures, individuals are expected to express more emotions in general, and more positive emotions in particular.[146] A global 2018 study by Gallup found that some of the most emotional countries of those studied included Niger, Ecuador, Costa Rica, and Sri Lanka where nearly 60% of those surveyed reported experiencing positive or negative emotions the previous day. Russia was the least emotional country.[147] Some concepts such as “service with a smile” are not universal and attempts to transport them have often failed. For example, Walmart experienced challenges when they required associates to smile at customers there. In Germany, smiling at strangers is regarded as off-putting and some customers may interpret this as flirting.[148] Key Takeaway Emotions play a role in shaping what we feel is ethical and what is not. Leisure time is important for avoiding the exhaustion phase of the stress cycle. Working from home has implications for stress. Countries vary a great deal in how many hours the average worker puts in at work, with Japan working the most hours, followed by those in the United States. What do you think? 1. Explain a time when you have seen emotions help someone to be more or less ethical than they might have otherwise been. 2. Overall, do you think that technology helps or hurts employees manage stress and their emotions at work? Why 3. Why do you think some countries have so much vacation time compared to others? In your opinion, is this a problem or not? Why? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work 7.7 Managing Stress and Emotions: The Case of NASA’s Mission to Mars Shutterstock.com Mars is a long way away—33.9 million miles to be exact—from Earth. But, that hasn’t stopped NASA from gaining approval in the bipartisan NASA Authorization Act of 2010 to send humans to Mars in the 2030s. While there are amazing technological and physical challenges associated with such an audacious goal, there are also serious organizational behavior challenges in terms of managing emotions and stress during the six- to nine-month-long journey there and back. Retired astronaut Scott Kelly, who spent one year on the International Space Station, says, “During my time in orbit, I lost bone mass, my muscles atrophied, and my blood redistributed itself in my body, which strained my heart. Every day, I was exposed to 10 times the radiation of a person on Earth, which will increase my risk of a fatal cancer for the rest of my life. Not to mention the psychological stress, which is harder to quantify and perhaps as damaging.” Lauren Landon, a research scientist at the Johnson Space Center at NASA’s Human Research Program, is helping prepare astronauts to safely and successfully go on the mission to Mars. To help understand the challenges, Landon says, “Imagine yourself on a team of six of your colleagues locked in a space the size of a Winnebago camper for two and a half years.” The stressors are real. It is a life or death situation every day in the hostile environment of space before they can even get to Mars. Because they are so far away, they cannot communicate to Mission Control in real time. There is no social support in the form of friends and family. They have no escape plan. They are in the situation for the duration. And, as retired cosmonaut Yuri Onufrienko notes, “If you think about taking a family trip, whether it’s with your spouse or with your family, and never getting out of the car, you can imagine some problems are going to crop up no matter how well you get along.” For this very reason, part of Landon’s job is to prepare astronauts to be full-time colleagues and roommates who can problem-solve interpersonally as well as technically. There are several stress management techniques available to help astronauts deal with these challenges. For example, they do have some physical privacy in their own private “closet” with their own things with a door that closes. They eat special food designed to help them. They exercise for several hours per day. They also have several tools available to help them deal with interpersonal stressors and challenging emotions. Still, in such close proximity to one another, little stressors can build up over time. Landon gives an example of how stressful interpersonal issues can be. If you have a colleague who clears their throat a few times a day here on Earth that is one thing. But if you had to hear that sound every day for two and a half years, that might be a different issue. To reduce the stress for the astronauts, they are trained to manage conflict and self-correct. One example is the team debrief which is designed to help the astronauts call out concerns, observations, and to ask questions. This requires a psychologically safe space to keep stress to a minimum and deal with small interpersonal issues before they become large issues. There are many tools available to help with this process. For example, they even have a mechanism to anonymously share a concern and the program will take that in and generate a discussion guide for everyone to go over. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 239 240 Organizational Behavior Additional research designed to give NASA further tools and insights is ongoing. For example, in 2017, six engineers and scientists voluntarily isolated themselves within a dome near the top of the world’s largest active volcano in Hawaii. While in the dome, which was about the size of a small two-bedroom house, they wore sensors designed to measure voice levels and proximity to one another. Researchers are also studying how sensors designed to measure mood might help to avoid conflicts from growing into major problems. One of the reasons for this is that astronauts tend to be positive and not report small issues. And, while astronauts are trained to deal with crisis situations and suppress their feelings and emotions when they need to, doing so can wear them down over time. The key is to balance the ability to suppress one’s emotions when you have to and to relax and be open in dealing with emotions during the downtimes. While that can be challenging for astronauts over long periods of time in space, getting to Mars successfully depends on it.[149] Multimedia Extension—Astronaut and Senator Scott Kelly on the Psychological Challenges of Going to Mars View in the online reader Case Discussion Questions 1. Being an astronaut is an extreme job. What other occupations might have similar extreme challenges? 2. If you were a NASA behavioral scientist, what would you want to study to help future astronauts deal with stress, emotions, and potential conflict? 3. Do you think the tools mentioned in this case would be helpful to other types of teams? Why or why not? 4. What do you think are the characteristics of someone who would cope with this job well? 5. What can NASA do to support the astronauts effectively? Can you think of other methods they might employ that are not mentioned in the case? 7.8 Conclusion Stress is a major concern for individuals and organizations. Models of stress include the General Adaptation Syndrome (GAS) model, the Demands-Control model, and the Job Demands-Resources © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work model. Stress has many causes including stressors such as role demands, work-family conflict, and other uncertainty factors. Outcomes of stress include physiological, psychological, and work outcomes. Exhaustion is the outcome of prolonged stress. Individuals and organizations can take many approaches to lessening the negative health and work outcomes associated with being overstressed. Emotions play a role in organizational life. Understanding these emotions helps individuals to manage them. Emotional labor can be taxing on individuals, while emotional intelligence may help individuals cope with the emotional demands of their jobs. 7.9 Exercises Ethical Dilemma Imagine that you work at a paper supply company that employs 50 people. A coworker, Darlene, is not your favorite person to be with at work. She is often late to work, can be unprofessional with coworkers, and isn’t someone you can routinely count on to go above and beyond her job duties. Last week you even noticed that her breath smelled like alcohol when you spoke to her about some last-minute orders that needed to be filled. But you don’t like to rock the boat and you don’t like to be disloyal to your coworkers, so you didn’t say anything. However another coworker, David, just approached you and asked whether you smelled alcohol on Darlene’s breath last Thursday. You are surprised and ask him why. David mentions that he heard some gossip and wants to confirm if it is true or not. What will you do? 1. Should you admit you smelled alcohol on Darlene’s breath last week? Why or why not? 2. What are the implications of each course of action? 3. Would you change your answer if, instead of working at a paper supply company, you worked as a nurse or as a construction worker? Individual Exercise Time Management Quiz Please answer true or false for each of the statements according to how you currently manage your time. Your instructor has the answer key to this exercise. 1. True or false: I sort my mail when it comes in, open it, place it in a folder, and deal with it when I am ready to. 2. True or false: I do what my boss asks me to do immediately. 3. True or false: I don’t take breaks because they waste time. 4. True or false: I answer the phone when it rings regardless of what I am doing. 5. True or false: I check my emails as soon as they arrive. 6. True or false: I create a “to do” list at the start of every day. 7. True or false: I do my “heavy thinking” at the end of the day when things have calmed down. 8. True or false: I don’t like to take vacations because making up the work is always too stressful. 9. True or false: Multitasking helps me be more effective at work. 10. True or false: I don’t have to organize my office since I always know where things are. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 241 242 Organizational Behavior Group Exercise Time Management Analysis Create List 1: List 10 activities you did at work (or at school) yesterday. Create List 2: List five things you think are key to doing your job well (or doing well in school). Compare Lists: Now, look at both lists and write down which items from List 1 relate to List 2. Place each activity from List 1 on the following grid. FIGURE 7.8 Group Discussion Now, as a group, discuss the following questions: 1. What trends in your time management style did you notice? 2. How much of your “work” time is being spent on things that are directly related to doing well in your work or at school? 3. What works well for you in terms of time management? 4. What steps could you take to improve your time management? 5. How could your group help one another with time management? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 7 Stress and Emotions at Work Endnotes 1. Case written by Rachel Mattenberger, Talya Bauer, and Berrin Erdogan to accompany Bauer, T. N. & Erdogan, B. (2021). 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Understand connections between communication at work and ethics, technology, and cross-cultural management. There are a lot of things that can go wrong between individuals. Research (and personal experience) frequently shows that communication is a major factor in how well groups and teams function and also explains how some individuals find themselves having misunderstandings again and again while others seem to encounter this relatively infrequently. Understanding how communication works and the research behind communication barriers and effective communications can be useful. Learning tips for communication for individual and team success such as discussing norms and expectations, and thinking through what might go wrong before it does, is worth the effort. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 248 Organizational Behavior 8.1 Communication That Transcends Cultures: The Case of IKEA NP27/Shutterstock.com IKEA is a Swedish-founded multinational company that designs and sells furniture, appliances, and home accessories. It has been the world’s largest furniture retailer since 2008. The company was founded in Sweden in 1943. It grew slowly and intentionally but over time it became an industry giant. Today IKEA has stores in over 50 countries, including China and India where other big box retailers have failed. IKEA earns billions of dollars globally in annual operating profit. It also regularly appears on Fortune’s coveted Great Places to Work and Best Employers for New Grads lists. IKEA even keeps its products’ Swedish names consistent across countries. The company’s founder was dyslexic, so he found it easier to make sense of familiar names rather than product codes. Product names range from Swedish islands to first names to Norwegian cities. Keeping these consistent ensures product names don’t get lost in translation between markets. In 2012, IKEA hired a new head of design, Marcus Engman, who was tasked with revamping its product development and getting more creative in the process. He did so by improving communication between divisions and communicating more transparently with consumers to help them reframe their perceptions of the brand. Although Engman left IKEA in 2018 to start his own consulting agency, his efforts have left a lasting impact on the organization. This transparency extends to the internal company culture, as well. The company’s Dublin store hosts an all-hands “huddle” in the store’s restaurant every morning before the store opens. This is an opportunity for management to share the previous day’s sales results and delegate responsibilities for the day, and for all employees to share store news with each other. Even IKEA’s senior executives understand the value of strong communication. Michael Ward, president of IKEA Canada, has strong storytelling skills and is able to communicate a strong vision for his employees as well as for the business. He takes his senior management team’s diverse opinions and synthesizes them into a strategy. In particular, he is known for looking out for team members in meetings who are quiet and appear to be deep in thought. He will ask them directly about what they are thinking to signal to them that he is interested in their perspectives, no matter how outlandish they may seem. This helps drive more productive conversations during meetings and encourages transparent communication between team members.[1] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work 249 Multimedia Extension—The IKEA Group—The Story of How We Work View in the online reader Case Discussion Questions 1. Does it surprise you that IKEA has been successful in so many countries? Do you think its standardized communication has contributed to its success? Why or why not? 2. How might a policy of transparency with consumers positively impact an organization? Are there any potential downsides to this approach? 3. What are some ways in which internal organizational communication might impact external marketing and vice versa? Do you see this being the case with IKEA? 4. Open and clear communication is a high priority for IKEA and feedback from employees of all levels is encouraged. How would you feel about working at an organization like this? Would you feel comfortable speaking your mind? 5. If you were a senior executive at a large multinational group, such as IKEA, what communication styles would you leverage to ensure your company’s success? Explain. 8.2 Understanding Communication Learning Objectives 1. Define communication. 2. Articulate why communication matters. 3. Understand the communication process. Communication is vital to organizations—it’s how we coordinate actions and achieve goals. It is defined in Webster’s dictionary as a process by which information is exchanged between individuals through a common system of symbols, signs, or behavior. We know that 50% to 90% of a manager’s time is spent communicating,[2] and communication ability is related to a manager’s performance.[3] In most work environments, a miscommunication is an annoyance—it can interrupt workflow by causing delays and interpersonal strife. But in some work arenas, like operating rooms and airplane cockpits, communication can be a matter of life and death. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. communication The process by which information is exchanged between individuals through a common system of symbols, signs, or behavior. 250 Organizational Behavior So, just how prevalent is miscommunication in the workplace? You may not be surprised to learn that the relationship between miscommunication and negative outcomes is very strong. For example, over half of medical malpractice cases suggest some form of miscommunication between patients and healthcare providers.[4] While malpractice suits are commonly filed against doctors based on the outcome of their treatments, a study of malpractice suits found that a primary influence on whether or not a doctor is sued is the doctor’s communication style. While the combination of a bad outcome and patient unhappiness can quickly lead to litigation, a warm, personal communication style leads to greater patient satisfaction. Simply put, satisfied patients are less likely to sue.[5] Further, data suggest that deficient interpersonal communication has resulted in over 1,000 fatalities in the airline industry.[6] Success on complicated missions at NASA depends on strong communication. Shutterstock.com In business, poor communication costs money and wastes time. It has been estimated that workers spend 16% of their time in unnecessary meetings and 23% of their time reading and responding to unnecessary emails.[7] In contrast, effective communication is an asset for organizations and individuals alike. Effective communication skills, for example, are an asset for job seekers. A study of recruiters at 85 business schools ranked communication and interpersonal skills as one of the most important skills they were looking for, with 89% of the recruiters saying they were important.[8] On the flip side, good communication can help a company retain its star employees. Surveys find that when employees think their organizations do a good job of keeping them informed about matters that affect them and when they have access to the information they need to do their jobs, they are more satisfied with their employers.[9] Good communication increases a company’s market value. It is understood that when you foster ongoing communications internally, you will have more satisfied employees who, in turn, will be better equipped to effectively communicate with your customers. Research finds that poor communications in a large company can cost the organization upwards of $62 million per year. In contrast, companies with leaders who are highly effective communicators show higher stakeholder returns compared to companies whose leaders are the least effective communicators.[10] We will explore the definition and benefits of effective communication later in this section. The Communication Process It is important to understand the communication process as it helps people avoid common problems and be more effective communicators. Communication fulfills three main functions within an organization, including coordination, transmission of information, and sharing emotions and feelings. All these functions are vital to a successful organization. The coordination of effort within an organization helps people work toward the same goals. Transmitting information is a vital part of this process. Sharing emotions and feelings bonds teams and unites people in times of celebration and crisis. Effective communication helps people grasp issues, build rapport with coworkers, and achieve consensus. So, how can we communicate effectively? The first step is to understand the communication process. We all exchange information with others countless times each day by phone, e-mail, video conferences, social media, printed word, and of course, in person. Let us take a moment to see how a typical communication works using this as a guide. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work 251 FIGURE 8.1 The Process Model of Communication A sender, such as a manager, coworker, or customer, originates the message with a thought. For example, the manager’s thought could be: “We need to complete this report this week. We took more time than we promised to the client.” The sender encodes the message, translating the idea into words. The manager may communicate this thought by saying, “James, I can’t believe we are not done with this report already. Our relationship with the client is on the line. Please make sure that this gets done.” The medium of this encoded message may be spoken words, written words, or signs. The receiver is the person who receives the message. The receiver decodes the message by assigning meaning to the words. James may translate the manager’s message as, “I need to stay late and finish this report tonight. I need to let my sister know that I can’t attend her birthday dinner tonight.” The meaning that the receiver assigns may not be the meaning that the sender intended, because of factors such as noise. Noise is anything that interferes with or distorts the message being transmitted. Noise can be external in the environment (such as distractions) or it can be within the receiver. For example, the receiver may be extremely nervous and unable to pay attention to the message. In our example, James may have interpreted his deadline as being shorter than the manager intended because of his lack of experience with the manager’s communication style, past conflicts about timeliness, or a desire to make a good impression. Noise can even occur within the sender: The sender may be unwilling to take the time to convey an accurate message, or the words that are chosen can be ambiguous and prone to misinterpretation. In the next scene, James may learn that he sacrificed a family get-together and his evening for a task that could have waited for a few days, which could damage his morale and his trust in the manager. Miscommunications like these happen in the workplace every day. But how does a miscommunication happen? It helps to think of the communication process. The series of arrows pointing the way from the sender to the receiver and back again can, and often do, fall short of their target. A meta-analysis of over 9,000 teams found that it is the quality of communication that matters most for team performance, not the frequency per se.[11] So, if you have to choose whether to focus on communication frequency or quality, invest in quality communications. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. sender The person initiating a communication. encode The translation of ideas into words. medium The method used to convey a sender’s message. receiver The person who a message is intended to reach. decode The process of assigning meaning to a received message. noise Anything that interferes with or distorts the message being transmitted. 252 Organizational Behavior Reprinted with permission. Originally published on ScienceForWork. Key Takeaway Communication is vital to organizations. Poor communication is prevalent between senders and receivers. Communication fulfills three functions within organizations, including coordination, the transmission of information, and sharing emotions and feelings. Senders and receivers take turns encoding and decoding messages to one another. Noise can disrupt or distort communication. What do you think? 1. Where have you seen the communication process break down at work? At school? At home? 2. Explain how miscommunication might be related to an accident at work. 3. Give an example of noise during the communication process. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work 253 8.3 Communication Barriers Learning Objectives 1. Understand different ways that the communication process can be sidetracked. 2. Understand the role poor listening plays in communication problems. 3. Understand what active listening is. 4. Learn strategies to become a more effective listener. Barriers to Effective Communication Several barriers stand in the way of effective communication. These include filtering, selective perception, information overload, emotional disconnects, lack of source familiarity or credibility, semantics, differences in meaning between the sender and the receiver, poor listening, and biased language. We explain each of these barriers in the following. Filtering Filtering is the distortion or withholding of information to manage a person’s reactions. Some examples of filtering include a manager’s keeping a division’s negative sales figures from a superior, in this case, the vice president. The old saying, “Don’t shoot the messenger!” illustrates the tendency of receivers to vent their negative response to unwanted messages to the sender. A gatekeeper (the vice president’s assistant, perhaps) who doesn’t pass along a complete message is also filtering. Additionally, the vice president may delete the email announcing the quarter’s sales figures before reading it, blocking the message before it arrives. Filtering prevents members of an organization from getting a complete picture of reality. To maximize the possibility of sending and receiving effective communications, it’s helpful to deliver a message in multiple ways and to seek information from multiple sources. In this way, the effect of any one person’s filtering the message will be diminished. Because people tend to filter bad news more when communicating with a superior, it is also helpful to remember that subordinates in an organization may be wary of sharing bad news. One way to defuse the tendency to filter is to reward employees who clearly convey information, regardless of whether the news is good or bad. Here are some of the criteria that individuals may use when deciding whether to filter a message or pass it on: 1. Past experience: Were previous senders rewarded for passing along news of this kind in the past, or were they criticized? 2. Knowledge and perception of the speaker: Has the receiver’s direct superior made it clear that “no news is good news”? 3. Emotional state, involvement with the topic, and level of attention: Does the sender’s fear of failure or criticism prevent the message from being conveyed? Is the topic within the sender’s realm of expertise, increasing confidence in the ability to decode the message, or is the sender © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. filtering The distortion or withholding of information to manage a person’s reactions. 254 Organizational Behavior out of a personal comfort zone when it comes to evaluating the message’s significance? Are personal concerns impacting the sender’s ability to judge the message’s value? Selective Perception selective perception The personal filtering of what we see and hear to suit our own needs. Selective perception refers to filtering information to suit our own needs. This process is often unconscious. Small things can command our attention when we’re visiting a new city or a new company. Over time, however, we begin to make assumptions about the way things are on the basis of our past experience. Often, much of this process is unconscious. “We simply are bombarded with too much stimuli every day to pay equal attention to everything so we pick and choose according to our own needs.” Selective perception is a necessary tool that provides efficiencies in a complex culture, but it can also lead to mistakes. A classic study on selective perception involved participants watching a particularly violent football game between Princeton and Dartmouth. Each side counted more infractions committed by the other side. In other words, when communicating with others, we have a tendency to hear what we want to hear, or see what we want to see. Famed Irish writer George Barnard Shaw once quipped, “The single biggest problem in communication is the illusion that it has taken place.” As one of only two to ever win both a Nobel Prize and an Oscar, his advice on communication is noteworthy. Information Overload and the Illusion of Multitasking As discussed in Chapter 7 information overload can be defined as “occurring when the information processing demands on an individual’s time to perform interactions and internal calculations exceed the supply or capacity of time available for such processing.”[12] Messages reach us in countless ways every day. Some are societal—advertisements that we may hear or see in the course of our day. Others are professional—emails, and memos, voice mails, and conversations from our colleagues. Others are personal—messages and conversations from our loved ones and friends. Experts note that information overload is “a symptom of the high-tech age, which is too much information for one human being to absorb in an expanding world of people and technology. The sources of information overload include TV, newspapers, and magazines as well as wanted and unwanted regular mail, e-mail, and faxes. It has been exacerbated enormously because of the formidable number of results obtained from Web search engines.”[13] Other research shows that working in such a fragmented fashion has a significant negative effect on efficiency, creativity, and mental acuity.[14] multitasking Refers to performing more than one activity at the same time. Many individuals react to being bombarded with emails, phone calls, text messages, and other information by what they consider to be multitasking. Multitasking refers to performing more than one activity at the same time. However, paying attention to multiple communications media at the same time, such as texting while listening to a colleague, may best be characterized as the “illusion of multitasking.” Unlike listening to music and writing a report, which may be accomplished simultaneously, trying to communicate through multiple media usually does not result in positive outcomes, because the individual is switching attention from one task to another in quick succession. Your brain needs to constantly refocus on a different activity. As a result, the effectiveness of the communication suffers. In one study, when mobile phones were used during negotiations, negotiators achieved worse outcomes and were perceived as less trustworthy. In another study, when participants were multitasking by interacting with multiple partners over text messages and phone, their task performance suffered compared to participants who were focused on a single task. Further, while they thought that they were doing an adequate job with both their conversation partners, their partners rated them lower, presumably because they felt they were shortchanged.[15] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work 255 Emotional Disconnects Emotional disconnects happen when the sender or the receiver is upset, whether about the subject at hand or about some unrelated incident that may have happened earlier. An effective communication requires a sender and a receiver who are open to speaking and listening to one another, despite possible differences in opinion or personality. One or both parties may have to put their emotions aside to achieve the goal of communicating clearly. A receiver who is emotionally upset tends to ignore or distort what the sender is saying. A sender who is emotionally upset may be unable to present ideas or feelings effectively. Effective communication also requires senders and receivers to understand and have empathy for the emotional impact of the message content or how it is sent. For example, in a meeting about upcoming organizational changes, employees may be feeling stressed and anxious about their job security. Not recognizing this, giving a lot of technical details about the timing and logistics of the change or how the change will benefit the organization may result in mistrust in management as their feelings of anxiety are not being recognized and addressed. Lack of Source Familiarity or Credibility Lack of source familiarity or credibility can derail communications, especially when humor is involved. Sarcasm and irony are subtle, and have a high potential to be misunderstood. Lack of familiarity with the source of a joke can lead to misinterpreting humor, especially in less-rich information channels such as email. Similarly, if the sender lacks credibility or is untrustworthy, the message will not get through. Receivers may be suspicious of the sender’s motivations (“Why am I being told this?”). Likewise, if the sender has communicated erroneous information in the past or has created false emergencies, his current message may be filtered. In other words, it is important to recognize that who communicates the message is often as important as what is being communicated. Feedback coming from a trustworthy source will have more value compared to feedback coming from someone who is not trusted. Workplace Gossip Workplace gossip, also known as the grapevine, is a lifeline for many employees seeking information about their company. Researchers agree that the grapevine is an inevitable part of organizational life, with 70% of all organizational communication occurring at the grapevine level. Employees trust their peers as a source of messages, but the grapevine’s informal structure can be a barrier to effective communication from the managerial point of view. Its grassroots structure gives it greater credibility in the minds of employees than information delivered through official channels, even when that information is false. A study of a positive side of gossip found that the likelihood that information would be shared made individuals less likely to act in a selfish manner. Some downsides of the office grapevine are that gossip offers politically minded insiders a powerful tool for disseminating communication (and self-promoting miscommunications) within an organization. In addition, the grapevine lacks a specific sender, which can create a sense of distrust among employees—who is at the root of the gossip network? When the news is volatile, suspicions may arise as to the person or persons behind the message. Managers who understand the grapevine’s power can use it to send and receive messages of their own. They also decrease the grapevine’s power by sending official messages quickly and accurately, should big news arise. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. grapevine The informal gossip network within a given organization. 256 Organizational Behavior Semantics semantics The meaning of a word or phrase. jargon A set of acronyms or words unique to a specific group or profession. Words can mean different things to different people, or they might not mean anything to another person. This is called semantics. For example, companies often have their own acronyms and buzzwords (called business jargon) that are clear to them but impenetrable to outsiders. At IBM, GBS is focusing on BPTS, using expertise acquired from the PwC purchase (which had to be sold to avoid conflicts of interest in light of SOX) to fend off other BPO providers and inroads by the Bangalore tiger. Does this make sense to you? If not, here’s the translation: IBM’s Global Business Services (GBS) division is focusing on offering companies Business Process Transformation Services (BPTS), using the expertise it acquired from purchasing the management consulting and technology services arm of PricewaterhouseCoopers (PwC), which had to sell the division due to the SarbanesOxley Act (SOX; enacted in response to the major accounting scandals such as Enron). The added management expertise puts it above business process outsourcing (BPO) vendors who focus more on automating processes rather than transforming and improving them. Chief among these BPO competitors is Wipro, often called the “Bangalore tiger” because of its geographic origin and aggressive growth. Given the amount of messages we send and receive every day, it makes sense that humans would try to find a shortcut—a way to communicate things in code. In business, this code is known as jargon. Jargon is the language of specialized terms used by a group or profession. It is common shorthand among experts and if used sensibly can be a quick and efficient way of communicating. Most jargon consists of unfamiliar terms, abstract words, nonexistent words, acronyms, and abbreviations, with an occasional euphemism thrown in for good measure. Every profession, trade, and organization has its own specialized terms.[16] There are benefits to using jargon—a quicker way to send an effective communication similar to the way text message abbreviations can send common messages in a shorter, yet understandable way. The use of jargon also communicates expertise. For example, if you are an accounting major, you will be expected to be familiar with terms such as “balance sheet,” “accounts receivable,” and “ROI,” and asking for clarification will introduce doubts about your expertise. However, jargon can be an obstacle to effective communication, causing listeners to tune out or fostering ill feelings between partners in a conversation. When jargon rules the day, the message can get obscured. A key question to ask yourself before using jargon is, “Who is the receiver of my message?” If you are a specialist speaking to another specialist in your area, jargon may be the best way to send a message while forging a professional bond—similar to the way best friends can communicate in code. For example, an IT technician communicating with another IT technician may use jargon as a way of sharing information in a way that reinforces the pair’s shared knowledge. But that same conversation should be held in Standard English, free of jargon, when communicating with staff members outside the IT group. The following OB Toolbox will help you avoid letting business jargon get in your way at work. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work OB Toolbox: Tips for Reducing Miscommunication-by-Jargon Shutterstock.com • Know your audience. If they weren’t sitting beside you in law school, medical school, or in that finance or technology class, then assume they don’t know what you are talking about. Speak for the other person and not yourself. • Decode your acronyms. If you use an acronym in verbal or written communication, explain what it means after you use it for the first time. Your audience will filter your message otherwise, as they wonder, “Now what does ROI stand for?” (It stands for “return on investment,” btw—by the way.) • Limit your jargon use. Jargon doesn’t necessarily make you sound smart or business savvy. It can create communication barriers and obstacles and hurt your ability to build relationships and close deals.[17] Gender Differences in Communication Much has been written about men and women having different perspectives and styles and that’s also true about common thinking about gender and communication. However, while there seem to be communication style differences between men and women, we need to be aware of them without exaggerating these differences. In fact, when uncovered, many of these differences are modest, and there is more overlap across genders than there are differences.[18] And yet small differences in patterns of behavior may sometimes have profound effects on how one is perceived at work, and the effectiveness of communication. So we are highlighting a few relevant research findings in this area. There is quite a bit of research suggesting that women are less likely to be dominant or assertive in communications. For example, one study compared how much female and male senators spoke on the Senate floor. The more powerful male senators were, the more they spoke. Yet power had no effect on how much a female senator spoke. The same effect was replicated in an experiment. In both of these studies, low-power females limited the amount of time they spoke. Finally, in a follow-up experiment to these two studies, subjects reading about either a male or female CEO who speaks more than others rated the female CEO lower in competence and suitability for leadership. In other words, women may be speaking less in high-stakes communication events such as meetings because there may be a backlash against women who are perceived to speak more than others, which does not exist for men who dominate conversations.[19] Supporting these findings, it has been observed that women tend to withhold their opinions more in meetings, and what they perceive as “passion” in these conversations is often perceived as “too much emotion” by men. How can organizations deal with these differences? Increasing gender balance may be helpful, as will proactively ensuring that all attendees at a meeting have an opportunity to have their voices heard. Asking direct questions to the quieter members may go a long way in achieving inclusiveness.[20] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 257 258 Organizational Behavior Biased Language Biased language can offend or stereotype others on the basis of their personal or group affiliation. Words and actions that stereotype others on the basis of personal or group affiliation are examples of bias. Table 8.1 provides a list of words that have the potential to be perceived as derogatory or demeaning. The column on the right provides alternative words that can be used instead.[21] TABLE 8.1 Words Matter: Choose Them Thoughtfully Avoid Consider Using black attorney attorney businessman business person chairman chair or chairperson cleaning lady cleaner or maintenance worker male nurse nurse manpower staff or personnel Effective communication is clear, factual, and goal oriented. It is also respectful. Referring to a person by one adjective (a brain, a diabetic) reduces the person to that one characteristic. Language that inflames or stereotypes a person poisons the communication process. Language that insults an individual or group based on age, ethnicity, sexual preference, or political beliefs violates public and private standards of decency, ranging from civil rights to corporate regulations. The effort to create a neutral set of terms to refer to heritage and preferences has resulted in a debate over the nature of “political correctness.” Proponents of political correctness see it as a way to defuse the volatile nature of words that stereotyped groups and individuals in the past. Critics of political correctness see its vocabulary as stilted and needlessly cautious. Many companies offer new employees written guides on standards of speech and conduct. These guides, augmented by common sense and courtesy, are solid starting points for effective, respectful workplace communication. Tips for inclusive workplace speech include, but are not limited, to the following: • Replace pronouns such as he and she with more gender-neutral options such as they sends a signal that gender does not matter in the workplace. • Rely on human resources–generated guidelines. • Remember that terms that feel respectful or comfortable to you may not be comfortable or respectful to others. Poor Listening Effective listening has been identified as a key skill in many professions, including sales managers, accountants, customer service employees, contractors, and health care professionals, among others. Not listening can be costly. For example, if every Starbucks employee misheard one $10 order each day, their errors would cost the company a billion dollars annually. To teach its employees to listen, Starbucks created a code that helps employees taking orders hear the size, flavor, and use of milk or decaffeinated coffee. The person making the drink echoes the order aloud. In a different estimate, Fortune 500 companies waste $75 million in a typical year in meetings, and a big chunk of this waste is due to a lack of listening to what is being said.[22] Research shows that effective listening has a behavioral and an emotional component. Behaviors such as paraphrasing (repeating) what was heard, asking probing questions to clarify a point, and answering questions when asked are behavioral aspects of listening. Emotional aspects include showing that you care about © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work the speaker, trying to actively understand the speaker, trying to relate to the speaker, and showing concern about what is being said and what is being left unsaid. Together, these behavioral and emotional elements of a conversation leave the speaker with a sense that he or she was heard.[23] How can you improve your listening skills? The Roman philosopher Cicero said, “Silence is one of the great arts of conversation.” How often have we been in a conversation with someone else when we are not really listening but itching to convey our portion? This behavior is known as “rehearsing.” It suggests the receiver has no intention of considering the sender’s message and is actually preparing to respond to an earlier point instead. Effective communication relies on another kind of listening: active listening. Active listening can be defined as giving full attention to what other people are saying, taking time to understand the points being made, asking questions as needed, and not interrupting at inappropriate times.[24] Active listening creates a real-time relationship between the sender and receiver by acknowledging the content and receipt of a message. As we’ve seen in the previous Starbucks example, repeating and confirming a message’s content offers a way to confirm that the correct content is flowing between colleagues. The process creates a bond between coworkers while increasing the flow and accuracy of messaging. OB Toolbox: How to Be An Active Listener Shutterstock.com 1. Start by stopping. Take a moment to inhale and exhale quietly before you begin to listen. Your job as a listener is to receive information openly and accurately. 2. Don’t worry about what you’ll say when the time comes. Silence can be a beautiful thing. 3. Paraphrase. When the sender pauses, summarize what you believe has been said. “What I’m hearing is that we need to focus on marketing as well as sales. Is that correct?” Be attentive to physical as well as verbal communications. “I hear you saying that we should focus on marketing, but the way you’re shaking your head tells me the idea may not really appeal to you—is that right?” 4. Don’t multitask while listening. Listening is a full-time job. It’s tempting to multitask when you and the sender are in different places, but doing that is counterproductive. The human mind can only focus on one thing at a time. Listening with only part of your brain increases the chances that you’ll have questions later, ultimately requiring more of the speaker’s time. (And when the speaker is in the same room, multitasking signals a disinterest that is considered rude.) So, set aside your smart phone. 5. Try to empathize with the sender’s point of view. You don’t have to agree, but can you find common ground? 6. Ask questions. There’s nothing wrong with admitting you haven’t understood the sender’s point. You may even help the sender clarify the message. 7. Establish eye contact. Making eye contact with the speaker (if appropriate for the culture) is important. 8. What is the goal of this communication? Ask yourself this question at different points during the communication to keep the information flow on track. Be polite. Differences in opinion can be the starting point of consensus. 9. It’s great to be surprised. Listen with an open mind, not just for what you want to hear. 10. Pay attention to what is not said. Does the sender’s body language seem to contradict the message? If so, clarification may be in order. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 259 260 Organizational Behavior Key Takeaway Many barriers to effective communication exist. Examples include filtering, selective perception, information overload, emotional disconnects, lack of source credibility, workplace gossip, gender differences, semantics, biased language, and poor listening skills, among others. What do you think? 1. Most individuals are poor listeners. Do you agree or disagree with this statement? Please support your position. 2. Please share an example of how lack of source familiarity has affected you. 3. When you see a memo or email full of typos, poor grammar, or incomplete sentences, how do you react? Does it affect your perception of the sender? Why or why not? 4. Give an example of selective perception. 5. Do you use jargon at work or in your classes? If so, do you think it helps or hampers communication? Why or why not? 8.4 Different Types of Communication Learning Objectives 1. Understand different types of communication. 2. Understand how communication channels affect communication. 3. Recognize different communication directions within organizations. Types of Communication Communication can be categorized into three basic types: (1) verbal communication, in which you listen to a person to understand their meaning; (2) written communication, in which you read their meaning; and (3) nonverbal communication, in which you observe a person and infer meaning. Each has its own advantages and disadvantages. Verbal Communication Verbal communications take place over the phone, in person, or via video conferencing. With verbal communication, the medium of the message is oral. Research shows that individuals tend to enjoy verbal communications and they are effective in helping to build relationships at work.[25] In addition, oral communication has a special place at work including the role of storytelling and crucial conversations. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work 261 Storytelling Storytelling has been shown to be an effective form of verbal communication; it serves an important organizational function by helping to construct common meanings for individuals within the organization. Stories can help clarify key values and can help demonstrate how things are done within an organization, and story frequency, strength, and tone are related to higher organizational commitment.[26] The quality of the stories entrepreneurs tell is related to their ability to secure capital for their firms.[27] storytelling A narrative account of an event or events. Crucial Conversations While the process may be the same, high-stakes communications require more planning, reflection, and skill than normal day-to-day interactions at work. Examples of high-stakes communication events include asking for a raise or presenting a business plan to a venture capitalist. In addition to these events, there are also many times in our professional lives when we have crucial conversations—discussions where not only the stakes are high but also where opinions vary and emotions run strong.[28] One of the most consistent recommendations from communications experts is to work toward using “and” instead of “but” as you communicate under these circumstances. In addition, be aware of your communication style and practice flexibility; it is under stressful situations that communication styles can become the most rigid. High-stakes communication requires a lot of preparation, even when it looks as if it is spontaneous. For example, if you are thinking about making a key point and go against the consensus opinion at a meeting, it would be useful to practice what you are going to say so that what you say is clear, concise, and impactful. Written Communication In contrast to verbal, or oral, communications, written business communications are printed messages. Most written communication today takes place online. Email and text messages are easy and cheap methods of collaborating at work. There are also alternatives to email, in the form of online collaboration software. Company-level social platforms such as Yammer, Jive, and Chatter allow users to collaborate and communicate using Intranets (within the company only) via chat, instant messaging, blogs, and managing tasks in an integrated platform. Other written documents may include handbooks, procedures, policies, and websites. Written communication is often asynchronous. That is, the sender can write a message that the receiver can read at any time, unlike a conversation that is carried on in real time. A written communication can also be read by many people (such as all employees in a department or all customers). It’s a “one-to-many” communication, as opposed to a one-to-one conversation. There are exceptions, of course: A voice mail is an oral message that is asynchronous. Conference calls and speeches are oral one-to-many communications, and emails can have only one recipient or many. Normally, a verbal communication takes place in real time. Written communication, by contrast, can be constructed over a longer period of time. It also can be collaborative. Multiple people can contribute to the content on one document before that document is sent to the intended audience. Verbal and written communications have different strengths and weaknesses. In business, the decision to communicate verbally or in written form can be a powerful one. As we’ll see in the following, each style of communication has particular strengths and pitfalls. When determining whether to communicate verbally or in writing, ask yourself: Do I want to convey facts or feelings? Verbal communications are a better way to convey feelings. Written communications do a better job of conveying facts. Picture a manager making a speech to a team of 20 employees. The manager is speaking at a normal pace. The employees appear interested. But how much information is being transmit- © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. crucial conversations Discussions in which the stakes are high, opinions vary, and emotions run strong. 262 Organizational Behavior ted? Humans listen much faster than they speak. The average public speaker communicates at a speed of about 125 words a minute, and that pace sounds fine to the audience. (In fact, anything faster than that probably would sound strange. To put that figure in perspective, someone having an excited conversation speaks at about 150 words a minute.) Based on these numbers, we could assume that the audience has more than enough time to take in each word the speaker delivers, which actually creates a problem. The average person in the audience can hear 400 to 500 words a minute.[29] Consequently, the audience has more than enough time to hear. As a result, their minds may wander. Organizations can communicate complicated information via checklists. Airplane pilots are required to use this method extensively as it helps to avoid accidents. The World Health Organization recently launched the 19-item safety checklist to save lives during surgeries. In a study in eight hospitals in eight countries, the use of checklists significantly reduced the number of complications and deaths. As you can see, oral communication is the most often used form of communication, but it is also an inherently flawed medium for conveying specific facts. Knowing this information allows individuals to make more intelligent communication choices based on the kind of information one desires to convey. Most jobs involve some degree of writing. According to the National Commission on Writing, 67% of salaried employees in large American companies and professional state employees have some kind of writing responsibility. Half of responding companies reported that they take writing into consideration when hiring professional employees, and 91% always take writing into account when hiring.[30] Luckily, it is possible to learn to write clearly. Below are some tips on writing well. Ways to Communicate More With Fewer Words • Don’t use more words than you need. Think “less is more” when communicating. • Picture the receiver in your mind before you begin to write. After all, a written communication is a link between people. • Choose simple words. When in doubt, choose the shorter word (“Automobile or car? Car!”) Shutterstock.com • Be polite and clear. Your message will make a strong, clear impact. • Make your message brief and direct by trimming redundant words or phrases. Compare “Having thus explored our first option, I would now like to begin to explore the second option that may be open to us.” to “After considering Option 1, I would like to look at Option 2.” • Choose strong, active verbs. “I suggest . . .” instead of “It would seem to me that we might. . . .” • Use spelling- and grammar-check software. Remember, concise writing equals more effective communication. Nonverbal Communication What you say is a vital part of any communication. But what you don’t say can be equally or even more important. Research also shows that 55% of in-person communication comes from nonverbal cues such as facial expressions, body stance, and tone of voice. According to one study, only 7% of a receiver’s comprehension of a message is based on the sender’s actual words; 38% is based on paralanguage (the tone, pace, and volume of speech), and 55% is based on nonverbal cues (body language).[31] Research shows that nonverbal cues can also affect whether you get a job offer. Judges examining videotapes of actual applicants were able to assess the social skills of job candidates with the sound turned off. They watched the rate of gesturing, time spent talking, and the formality of dress to determine which candidates would be the most successful socially on the job.[32] For this reason, it is important to consider how we appear in business as well as what we say. The muscles of our faces convey our emotions. We can send a silent message without saying a word. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work 263 To be effective communicators, body language, appearance, and tone need to be aligned with the words one is trying to communicate. Research shows that when individuals are lying, they are more likely to blink more frequently, shift their weight, and shrug.[33] What happens when verbal and nonverbal cues are in conflict? Nonverbal communication is thought to be more spontaneous and therefore harder to fake. As a result, when in doubt, we believe in the nonverbal cues rather than what is actually being said.[34] A different tone can change the perceived meaning of a message. See Table 8.2 for how clearly this can be true. If we only read these words, we would be left to wonder, but during a conversation, the tone conveys a great deal of information. Don’t Use That Tone with Me! Changing your tone can dramatically change your meaning.[35] TABLE 8.2 Placement of the emphasis What it means I did not tell Chris you were late. Someone else told Chris you were late. I did not tell Chris you were late. This did not happen. I did not tell Chris you were late. I may have implied it. I did not tell Chris you were late. But maybe I told Sharon and José. I did not tell Chris you were late. I was talking about someone else. I did not tell Chris you were late. I told him you still are late. I did not tell Chris you were late late. I told him you were attending another meeting. Following are a few examples of nonverbal cues that can support or detract from a sender’s message, including body language and a focus on eye contact, facial expressions, posture, touch, and space. Body Language A simple rule of thumb is that simplicity, directness, and warmth conveys sincerity. Sincerity is vital for effective communication. In some cultures, a firm handshake, given with a warm, dry hand, is a great way to establish trust. A weak, clammy handshake might convey a lack of trustworthiness. Gnawing one’s lip conveys uncertainty. A direct smile conveys confidence.[36] Crossing one’s arms indicates a lack of openness to ideas being presented. Facial Expressions The human face can produce thousands of different expressions. These expressions have been decoded by experts as corresponding to hundreds of different emotional states.[37] Our faces convey basic information to the outside world. Happiness is associated with an upturned mouth and slightly closed eyes; fear with an open mouth and wide-eyed stare. Shifty eyes and pursed lips convey a lack of trustworthiness. The impact of facial expressions in conversation is instantaneous. Our brains may register them as “a feeling” about someone’s character. For this reason, it is important to consider how we appear in business as well as what we say. The muscles of our faces convey our emotions. We can send a silent message without saying a word. A change in facial expression can change our emotional state. Before an interview, for example, if we focus on feeling confident, our face will convey that confidence to an interviewer. Adopting a smile (even if we’re feeling stressed) can reduce the body’s stress levels. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 264 Organizational Behavior Eye Contact In business, the style and duration of eye contact varies greatly across cultures. In the United States, looking someone in the eye (for about a second) is considered a sign of trustworthiness. Establishing and maintaining eye contact is often the first step in building a connection with someone else. This seems to be true even in interactions with nonhumans. An experimental study showed that shoppers were more likely to choose a cereal if the cartoon on the box was looking at the shopper as opposed to looking away.[38] At the same time, uninterrupted eye contact for an extended period of time will be intimidating. Posture The position of our body relative to a chair or other person is another powerful silent messenger that conveys interest, aloofness, professionalism, or lack thereof. Head up, back straight (but not rigid) implies an upright character. In interview situations, experts advise mirroring an interviewer’s tendency to lean in and settle back in a seat. The subtle repetition of the other person’s posture conveys that we are listening and responding. And research shows that one’s own body language can influence how powerful a person feels.[39] Touch The meaning of a simple touch differs between individuals, genders, and cultures. In Mexico, when doing business, men may find themselves being grasped on the arm by another man. To pull away is seen as rude. In Indonesia, to touch anyone on the head or to touch anything with one’s foot is considered highly offensive. Americans, as we have noted before, place great value in a firm handshake, but one that is too strong is also a problem. Space Anthropologist Edward T. Hall coined the term proxemics to denote the different kinds of distance that occur between people. These distances vary among cultures. Standing too far away from a colleague (public speaking distance) or too close to a colleague (intimate distance for embracing) can thwart an effective verbal communication in business. Figure 8.2 outlines the basic proxemics of everyday life and their associated meaning.[40] One of the challenging aspects of social distancing during the COVID-19 pandemic was the avoidance of coming closer than 6 feet from others—even those we are personal with. Even handshaking, which in the United States is a common form of nonverbal communication in business, became discouraged during this time. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work 265 FIGURE 8.2 Proxemic Zones Distance between speakers is partially determined by their intimacy level. Source: Hall, E. T. (1966). The hidden dimension. New York: Doubleday. Communication Channels The channel, or medium, used to communicate a message affects how accurately the message will be received. Channels vary in their “information richness.” Information-rich channels convey more nonverbal information. Research shows that effective managers tend to use more information-rich communication channels than less effective managers.[41] Figure 8.3 illustrates the information richness of different channels. The key to effective communication is to match the communication channel with the goal of the message.[42] For example, written media may be a better choice when the sender wants a record of the content, has less urgency for a response, is physically separated from the receiver, and doesn’t require a lot of feedback from the receiver, or when the message is complicated and may take some time to understand. Oral communication, on the other hand, makes more sense when the sender is conveying a sensitive or emotional message, needs feedback immediately, and does not need a permanent record of the conversation. TABLE 8.3 Guide for When to Use Written versus Verbal Communication Use Written Communication When: Use Verbal Communication When: Conveying facts Conveying emotion and feelings The message needs to become part of a permanent file The message does not need to be permanent There is little time urgency There is time urgency You do not need immediate feedback You need immediate feedback The ideas are complicated The ideas are simple or can be made simple with explanations Like face-to-face and telephone conversations, video conferencing has high information richness, because receivers and senders can see or hear beyond just the words that are used—they can see the sender’s body language or hear the tone of their voice. Handheld devices, blogs, and written © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 266 Organizational Behavior letters and memos offer medium-rich channels because they convey words and pictures or photos. Formal written documents, such as legal documents and budget spreadsheets, convey the least richness because the format is often rigid and standardized. As a result, the tone of the message is often lost. FIGURE 8.3 Information Channel and Richness This image illustrates the information richness of different communication channels. Shutterstock.com The growth of email has been spectacular, but it has also created challenges in managing information and an ever-increasing speed of doing business. Approximately 59% (4.54 billion people) of the world’s population use the internet.[43] Internet users around the world send an estimated 306 © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work billion emails every day, and many of those are spam or scam attempts.[44] That makes email the second most popular medium of communication worldwide, second only to voice. A 2005 study estimated that less than 1% of all written human communications even reached paper—and, of course, this percentage has gone down even further since then.[45] To combat the overuse of email, companies such as Intel have even instituted “no email Fridays” where all communication is done via other communication channels. And some companies such as Daimler, a German-based automotive company, have eliminated vacation email overload. Referred to as the “Mail on Holiday” policy, employees are able to set up out of office emails that alert the sender that they are on vacation and that the email has been deleted. It then directs them to either contact someone else who is covering their work or to contact them again when they return from vacation.[46] In addition to organizational strategies, learning to be more effective in your email communications is an important skill. OB Toolbox: Business Email Dos and Don’ts Shutterstock.com • DON’T make email your default way of communication. Sometimes calling or talking is more appropriate. • DON’T put anything in an email that you don’t want the world to see. • DON’T answer an email in anger or while feeling strong emotions. You might regret it! • DON’T routinely CC everyone. Reducing inbox clutter is a great way to increase communication. • DON’T hit send until you’ve spell-checked your email. • DO use a subject line that summarizes your message, adjusting it as the message changes over time. • DO make your request in the first line of your email. (And if that’s all you need to say, stop there!) • DO end your email with a brief sign-off such as, “Thank you,” followed by your name and contact information. • DO think of a work email as a binding communication. • DO let others know if you’ve received an email in error.[47] An important although often ignored rule when communicating emotional information is that email’s lack of richness can be your loss. As we saw in Table 8.3, email is a medium-rich channel. It can convey facts quickly. But when it comes to emotion, email’s flaws make it a far less desirable choice than oral communication—the 55% of nonverbal cues that make a conversation comprehensible to a listener are missing. Researchers also note that email readers don’t pick up on sarcasm and other tonal aspects of writing as much as the writer believes they will.[48] The sender may believe that certain emotional signifiers have been included in a message. But, with written words alone, those signifiers are not there. This gap between the form and content of email inspired the rise of emoticons—symbols that offer clues to the emotional side of the words in each message. Generally speaking, however, emoticons are not considered professional in business communication. Individuals often feel uncomfortable conveying an emotionally laden message verbally, especially when the message contains unwanted news. Sending an e-mail to your staff that there will be no bonuses this year may seem easier than breaking the bad news face to face, but that does not mean that email is an effective or appropriate way to break this kind of news. When the message is © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 267 268 Organizational Behavior emotional, the sender should use verbal communication. Indeed, a good rule of thumb is that more emotionally laden messages require more thought in the choice of channel and how they are communicated. Career Advice Communication can occur without you even realizing it. Consider the following: Is your email name professional? The typical convention for business email contains some form of your name. While a name like “LazyGirl” or “DeathMonkey” may be fine for gaming or chatting online with your friends, they may send the wrong signal to individuals you email such as professors and prospective employers. Is your outgoing voice mail greeting professional? If not, change it. Faculty and prospective recruiters will draw certain conclusions if, upon calling you, they get a message that screams, “Party, party, party!” Do you have a social networking account on Pinterest, Google+, Instagram, YouTube, Twitter, or Facebook? If so, consider what it says about you to employers or clients. If it is information you wouldn’t share at work, it probably shouldn’t be there as your privacy is not assured. Googled yourself lately? If not, you probably should. Potential employers have begun searching the Web as part of background checking, and you should be aware of what’s out there about you. It is possible to set up automated reports with Google so that every time your name (or any other term) is mentioned on the Web, you are alerted. Direction of Communication Within Organizations Information can move horizontally, from a sender to a receiver, as we’ve seen. It can also move vertically, down from top management, or up from the front line. Information can also move diagonally between and among levels of an organization, such as a message from a customer service rep to a manager in the manufacturing department or a message from the chief financial officer sent down to all department heads. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work FIGURE 8.4 Directions of Communication Organizational communication travels in many different directions. The organizational status of the sender can impact the receiver’s attentiveness to the message. For example, consider the following: A senior manager sends a memo to a production supervisor. The supervisor, who has a lower status within the organization, is likely to pay close attention to the message. The same information conveyed in the opposite direction, however, might not get the attention it deserves. The message would be filtered by the senior manager’s perception of priorities and urgencies. Requests are just one kind of communication in business. Other communications, either verbal or written, may seek, give, or exchange information. Research shows that frequent communications with one’s supervisor is related to better job performance ratings and overall organizational performance.[49] Research also shows that lateral communication done between peers can influence important organizational outcomes such as turnover.[50] External Communications External communications deliver specific business messages to individuals outside an organization. They may announce changes in staff or strategy, earnings, and more. The goal of an external communication is to create a specific message that the receiver will understand and share with others. Examples of external communications include the following. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 269 270 Organizational Behavior Press Releases public relations Professionals who create external communications about a client’s product, services, or practices for specific receivers. Public relations professionals create external communications about a client’s product, services, or practices for specific receivers. These receivers, it is hoped, will share the message with others. In time, as the message is passed along, it should appear to be independent of the sender, creating the illusion of an independently generated consumer trend, public opinion, and so on. The message of a public relations effort may be b2b (business to business), b2c (business to consumer), or media related. The message can take different forms. Press releases try to convey a newsworthy message, real or manufactured. It may be constructed like a news item, inviting editors or reporters to reprint the message in part or as a whole, with or without acknowledgment of the sender’s identity. Public relations campaigns create messages over time through contests, special events, trade shows, and media interviews in addition to press releases. Ads Advertising places external business messages before target receivers through media buys. A media buy is a fee that is paid to a television network, website, magazine, and so on by an advertiser to insert an advertisement. The fee is based on the perceived value of the audience who watches, reads, listens to, or frequents the space where the ad will appear. In recent years, receivers have begun to filter out advertisers’ messages. This phenomenon is perceived to be a result of the large amount of ads the average person sees each day and a growing level of consumer wariness of paid messaging. Advertisers, in turn, are trying to create alternative forms of advertising that receivers won’t filter. The advertorial is one example of an external communication that combines the look of an article with the focused message of an ad. Product placements in videos, movies, and games are other ways that advertisers strive to reach receivers with commercial messages. Web Pages A Web page’s external communication can combine elements of public relations, advertising, and editorial content, reaching receivers on multiple levels and in multiple ways. Banner ads, blogs, and advertiser-driven “click-through” areas are just a few of the elements that allow a business to deliver a message to a receiver online. The perceived flexibility of online communications can impart a less formal (and therefore, more believable) quality to an external communication. A message relayed in a daily blog post, for example, will reach a receiver differently than if it is delivered in an annual report. The popularity and power of blogs is growing, with 54% of Fortune 500 companies having official blogs (up from 4% in 2005).[51] In fact, blogs have become so important to companies such as Coca-Cola Company, Eastman Kodak Company, and Marriott International Inc. that they have created official positions within their organizations titled “chief blogging officer.”[52] The “realtime” quality of Web communications may appeal to receivers who might filter out traditional ads and public relations messages because of their “prefab” quality. Despite a “spontaneous” feel, many online pages can be revisited many times in a single day. For this reason, clear and accurate external communications are as vital for online use as they are in traditional media. Customer Communications Customer communications can include social media, letters, catalogs, direct mail, e-mails, text messages, and telemarketing messages. Some receivers automatically filter these types of bulk messages. Others will be receptive. The key to a successful external communication to customers is © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work 271 to convey a business message in a personally compelling way—dramatic news, a money-saving coupon, and so forth. Key Takeaway Types of communication include verbal, written, and nonverbal. Surprisingly, 55% of face-toface communication comes from nonverbal cues such as tone or body language. Different communication channels are more or less effective at transmitting different kinds of information. In addition, communication flows in different directions within organizations. What do you think? 1. How aware are you of your own body language? Has your body language ever gotten you in trouble while communicating with someone? 2. In your experience, how is silence used in communication? 3. If the meaning behind verbal communication is only 7% words, what does this imply for written communication? 4. How could you use your knowledge of communication richness to be more effective in your own communications? 5. What are the three biggest advantages and disadvantages you see regarding technology and communications? 8.5 Focus on Communication, Ethics, Technology, and National Culture Learning Objectives 1. Consider the role of ethics in communication. 2. Consider the role of technology for communication. 3. Consider the role of national culture on communication. Ethics and Communication “People aren’t happy when the unexpected happens, but they are even unhappier if they find out you tried to hide it,” says Bruce Patton, co-founder of Boston-based Vantage Partners LLC.[53] To speak or not to speak? One of the most challenging areas of effective business communication occurs in moments of crisis management. But in an age of instant information, the burden on business to speak out quickly and clearly in times of crisis has never been greater. The alternative to a clear message is seen as a communication blocker, in addition to being guilty of the misdeed, disaster, or infraction at hand. The Exxon Valdez disaster is a classic example of ineffective crisis management and communication. When millions of barrels of oil spilled into © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Shutterstock.com 272 Organizational Behavior Prince William Sound, the company’s poor response only added to the damage. Exxon Mobil Corporation executives refused to acknowledge the extent of the problem and declined to comment on the accident for almost a week. Exxon also sent a succession of lower level spokespeople to deal with the media.[54] Instead, a more effective method of crisis communication is to have the company’s highest ranking official become the spokesperson who communicates the situation. This is the approach that James Burke, the chairman of Johnson & Johnson Services, Inc., took when tampering was discovered with Tylenol bottles. He became the face of the crisis, communicating with the public and explaining what J & J would do. His forthrightness built trust and allayed customer fears. Ethical, forthright communication applies inside the company as well as externally with the public. “When the truth is missing, people feel demoralized, less confident, and ultimately are less loyal,” write leadership experts Beverly Kaye and Sharon Jordan-Evans. “Research overwhelmingly supports the notion that engaged employees are ‘in the know.’ They want to be trusted with the truth about the business, including its challenges and downturns.”[55] Technology and Communication Shutterstock.com Technology allows workers to communicate remotely from anywhere in the world as long as they have access to a phone or computer connection and the right software. With the COVID-19 pandemic, which forced millions of workers to work remotely, the use of online meeting technology such as Zoom, MicrosoftTeams, and Skype was a lifeline to keeping meetings and communication going. However, with that, the term “Zoom Fatigue” become a common phase.[56] Reasons for online meetings actually consuming more energy than regular meetings go to the heart of communication and our ability as humans to process information. For example, communication disconnects can occur as it is challenging to understand the nuances of an in-person meeting. Further, we have all encountered frustrating technological errors due to weak wifi connections, frozen screens, and programs that crash abruptly. Work/life balance can also be a challenge that we do not have to physically contend with when meeting at work versus from our kitchen table or home office. Finally, we discussed how important eye contact is for active listening. However, when sitting in a large meeting at work, we don’t have to be focused in all the time, the physical layout of video cameras and thumb nails of each meeting attendee creates an unnatural amount of eye contact without a break which is mentally and physically exhausting.[57] Tips for managing Zoom Fatigue include avoiding multitasking, building in breaks away from the screen, reducing online stimuli as much as possible, or making phone calls or sending emails when possible. Cross-Cultural Communication Culture is a shared set of beliefs and experiences common to people in a specific setting. The setting that creates a culture can be geographic, religious, or professional. As you might guess, the same individual can be a member of many cultures, all of which may play a part in the interpretation of certain words. Shutterstock.com The different and often “multicultural” identity of individuals in the same organization can lead to some unexpected and potentially large miscommunications. For example, during the Cold War, Soviet leader Nikita Khrushchev told the American delegation at the United Nations, “We will bury you!” His words were interpreted as a threat of nuclear annihilation. However, a more accurate reading of Khrushchev’s words would have been, “We will overtake you!” meaning economic superiority. The words, as well as the fear and suspicion that the West had of the Soviet Union at the time, led to the more alarmist and sinister interpretation.[58] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work Miscommunications can arise between individuals of the same culture as well. Many words in the English language mean different things to different people. Words can be misunderstood if the sender and receiver do not share common experiences. A sender’s words cannot communicate the desired meaning if the receiver has not had some experience with the objects or concepts the words describe.[59] It is particularly important to keep this fact in mind when you are communicating with individuals who may not speak English as a first language. For example, when speaking with nonnative English-speaking colleagues, avoid “Isn’t it?” questions. This sentence construction does not exist in many other languages and can be confusing for nonnative English speakers. For example, to the question, “You are coming, aren’t you?” they may answer, “Yes” (I am coming) or “No” (I am coming), depending on how they interpret the question.[60] Cultures also vary in terms of the desired amount of situational context related to interpreting situations. People in very high context cultures put a high value on establishing relationships prior to working with others and tend to take longer to negotiate deals. Examples of high context cultures include China, Korea, and Japan. Conversely, people in low context cultures “get down to business” and tend to negotiate quickly. Examples of low context cultures include Germany, Scandinavia, and the United States.[61] Does yes always mean yes? In many cultures, the use of “yes” simply means understanding, not necessarily agreement. American managers discovered this soon after Lenovo’s acquisition of the PC division of IBM in 2005. On the other hand, Chinese managers were most surprised by their Western colleagues who were “thinking out loud.” Chinese managers often found it difficult to participate in conference calls because Westerners tend to be more assertive and talkative in meetings, as opposed to the Eastern style of listening more, and speaking only after careful consideration.[62] Finally, don’t forget the role of nonverbal communication. As we learned in the nonverbal communication section, in the United States, looking someone in the eye when talking is considered a sign of trustworthiness. In China, by contrast, a lack of eye contact conveys respect. A recruiting agency that places English teachers warns prospective teachers that something that works well in one culture can offend in another: “In Western countries, one expects to maintain eye contact when we talk with people. This is a norm we consider basic and essential. This is not the case among the Chinese. On the contrary, because of the more authoritarian nature of the Chinese society, steady eye contact is viewed as inappropriate, especially when subordinates talk with their superiors.”[63] Key Takeaway Ethical, forthright communication applies inside a company as well as externally with the public. Trying to cover up or ignore problems has been the downfall of many organizational members. There are differences in word meanings, whether communication occurs in a direct manner or is inferred from the context, and nonverbal communication. What do you think? 1. How can you assess if you are engaging in ethical communications? 2. What experiences have you had with cross-cultural communications? Please share at least one experience when this has gone well and one when it has not gone well. 3. Some companies have internal social networking pages where employees can mingle and share ideas and information. How do you think this practice affects workplace relationships, the effectiveness of workplace communications, and the ability to coordinate work? 4. What advice would you give to someone who will be managing a new division of a company in another culture in terms of communication? © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 273 274 Organizational Behavior 8.6 Instant Messaging in the Workplace: The Case of Slack Sundry Photography/Shutterstock.com In many workplaces ranging from Fortune 500 to small enterprises, workplace communication takes place over instant messaging. The leading platform in this space is Slack, a cloud-based team collaboration tool. Messages are organized by private and public channels and users can chat, share documents, browse through past messages, and collaborate with each other. Slack is solidifying the role of instant messages in the workplace and even if you end up in a company that does not use Slack, it is likely that you will end up using one of its competitors. Slack has an interesting founding story: Stewart Butterfield, who is also a co-founder of the image hosting service Flickr, founded the video game company Tiny Speck and released the game Glitch in 2011. As part of their game development process, the company also built a team communication platform, allowing software developers to communicate with each other while building Glitch. Glitch was shut down after a year, but the company devoted itself to the full-scale development of their communication tool, which resulted in Slack. Through word of mouth, Slack acquired 16,000 users in its beta stage, and the product was fully released in 2014. Six years later, the company boasts over 750,000 organizations (either free or paid subscriptions) and over 12 million users. The company expects to surpass email use in the workplace by 2025. Using instant messaging organized by private and public channels is changing how people communicate in the workplace, sometimes for the better, and sometimes for the worse. On the upside, Slack often receives feedback from users who identify as shy and introverted, stating that this tool allows them to participate more in team conversations. Anna Pickard, Creative Director, Voice and Tone, at Slack, also observes that messaging makes communication more humane and natural. Communication no longer takes place between small groups of people over email. Instead, it occurs in channels that are searchable and are organized by team or topic. People can reach out to and connect to people they would not otherwise. Many companies have an “ask me anything” channel where employees may post messages and high-level managers may answer, resulting in greater transparency and accessibility to upper management, helping create a sense of belonging. At the same time, technology sometimes amplifies communication problems that also occur in person, and creates new ones of its own. If you have ever written a chat message and instantly regretted it, you can imagine the problems that may occur at scale in the workplace. The instantaneous nature of chat can make people less deliberate and careful about their messages. There are also examples of private feedback given in an open channel, resulting in a public shaming of an employee. Slack conversations, even if they are in private channels, can be read by the employer, and may result in adverse employment actions against the employee. There is no “forward” button on instant messages, but it is all too easy to take a screen shot of the conversation and share with others, resulting in Slack leaks, similar to email leaks. Additionally, there is user error: In email it is relatively easy to find out who the recipients of the email are, but on Slack, people may pay less attention to who is on that channel, and others may join the channel at a © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work later point, suggesting that the audience for the posts will evolve and can grow over time. People may confuse which channel they are on, and post messages intended for a small group to a broad audience. As Slack grows, it develops its own etiquette. For example, hitting “enter” after every sentence is often mentioned as a no-no, and a pet peeve of heavy users. Senders are expected to complete their message and then hit enter in one go. Other habits may result in productivity losses: Spending time in private chats as opposed to working is one way in which Slack and tools like it may result in productivity losses. One company banned the use of Slack during meetings as people were having back-channel conversations during the meeting, which was distracting and affecting engagement in the meeting. How these tools are used are shaped by the office culture, and in turn will have an impact on culture of communication in the workplace.[64] Multimedia Extension—What Is Slack? View in the online reader Case Discussion Questions 1. If you were to create a social media policy including Slack, what types of rules would you include and why? 2. What types of messages do you believe are appropriate to communicate via Slack? For what type of communication is this tool less useful? 3. What type of communication barriers exist when workplace communication takes place over Slack and similar sources? 4. What are the implications of Slack and similar communication tools in affecting the sense of belonging that employees experience in the workplace? 5. Based on reading this case and your general experience with similar tools, what advice would you give to an employee who will start working in a company using Slack? 8.7 Conclusion In this chapter we have reviewed why effective communication matters to organizations. Communication may break down as a result of many communication barriers that may be attributed to the sender or receiver. Therefore, effective communication requires familiarity with the barriers. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 275 276 Organizational Behavior Choosing the right channel for communication is also important, because choosing the wrong medium undermines the message. When communication occurs in the cross-cultural context, extra caution is needed, given that different cultures have different norms regarding nonverbal communication, and different words will be interpreted differently across cultures. By being sensitive to the errors outlined in this chapter and adopting active listening skills, you may increase your communication effectiveness. 8.8 Exercises Ethical Dilemma In 2006, Hewlett-Packard Development Company LP became embroiled in a controversy over methods used to investigate media leaks from its board. HP Chairperson Patricia Dunn could have simply asked the directors who was the source cited in the story, sought an apology, and gone from there. With some direct face-to-face communication, the story would likely have ended quickly. It did not. “Not only did investigators impersonate board members, employees and journalists to obtain their phone records, but according to multiple reports, they also surveilled an HP director and a reporter for CNet Networks Inc. They sent monitoring spyware in an email to that reporter by concocting a phony tip. They even snooped on the phone records of former CEO and Chairperson Carly Fiorina, who had launched the quest to identify media sources in the first place.” The situation continued to escalate. For example, the New York Times reported that HP consultants even considered planting clerical or custodial workers at CNet and the Wall Street Journal to learn who was leaking information to them. Following this, Patricia Dunn, as well as three executives, left the company. A congressional hearing and several federal investigations later, executives were charged with felonies, and HP paid $14.5 million to settle civil charges related to the scandal. HP is not the only company to use such methods; recent admissions by the investigation firms involved suggest that the use of ethically questionable investigative tactics by large companies is quite common. “It betrays a type of corporate culture that is so self-obsessed, (that) really considers itself not only above the law, but above, I think, ethical decency, that you have to ask yourself, where did the shame come in?” said Charles King, an analyst with Pund-IT Inc. Consider this situation from a multiple stakeholder perspective. Imagine you are . . . • a CEO faced with leaks regarding your strategic vision. What would you do to determine who was sharing the information? What would be the advantages and disadvantages of these approaches? • a shareholder with HP stock. What would you want to see done to protect your investment in the company? • a board member who was spied upon. What would your reaction be to learning that you were investigated? • an investigator hired by HP. What role do you have to uphold ethical standards? As several observers have noted, HP spent a lot of time establishing whether or not their activities were technically legal but little time considering whether or not their actions were ethical. The effects of these events were felt for years after that. After Fiorina’s departure, Léo Apotheker left as CEO. By the time Meg Whitman took over as president and CEO of HP, things were not going well. In a meeting arranged to introduce her to a group of software engineers and managers, one employee told her he was “live blogging” her comments to the group. To this she replied, “You all have taken leaking to a new art form.” © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 8 Communication at Work Individual Exercise The Medium IIss the Message: Particularly in Employee Dismissals Terminating the employment of someone is a difficult conversation, regardless of how big the company is, how good a communicator you are, or what the reason for departure is. Some companies think that they found an easy way out of this problem: Why not send a quick, carefully crafted message to soon-to-be ex-employees? Or how about a mass conference call? A letter to their home address explaining what is happening and why? Examples of electronic separations abound. In 2014 in Chicago, Snarf’s sandwich shop sent a message to 20 employees three days before Christmas, telling them that the store would be closed indefinitely for remodeling, ending the message with “Ownership appreciates your service and wishes you well in your new endeavors." In 2006, Radioshack made the news by eliminating the positions of 400 employees and letting them know by email. And as it often happens with electronic communication, sometimes mistakes are made, resulting in accidental dismissals. Aviva Investors, one of the world’s largest insurers, sent a generic termination message intended for one employee to all of the company’s 1,300 employees. Email is often criticized for being impersonal, but how about a conference call? Patch, a news service organization, assigned all its employees into one of two conference call “rooms.” Then, all employees who dialed into one of the rooms (reaching hundreds in numbers) were told that their positions were being eliminated. Companies trying other such efficient methods included Hugo Boss, where news of the Cleveland plant closing was delivered via FedEx packages sent to employee homes right before Christmas.[65] Of course, letting employees go is always hard but being sensitive while doing so is an important part of business. 1. What is the rationale for conducting mass layoffs through electronic communication or other, impersonal methods? Do you see any advantages? 2. Do you feel that these impersonal methods are the “right way” to communicate this information? 3. What are some conditions that could justify firing someone via a text message or an email? 4. Does your decision differ for mass layoffs versus firing for cause? What is an appropriate method of communicating the news for different types of employee separations? Group Exercise You Know What I Mean, Right? Purpose This exercise illustrates how words we commonly take for granted are not universal in their meaning. Time Approximately 20 minutes. 1. Write down the number that comes to mind for each of the following questions. Remember that there are no right or wrong answers—just go with your first response. Do not discuss your answers with anyone in the class until instructed to do so. • My neighbor just bought an expensive car. How much did it cost? _____ • Several people were in line for the movie. How many people were in line? _____ • The ballot measure was approved overwhelmingly. What percentage of votes did the measure receive? _____ • My boss is an older man. How old is he? _____ • I recently saw an article in the paper. How long ago did I see it? _____ 2. Your instructor will summarize the responses from the class. 3. Discuss the following questions (either as a class or in small groups). © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 277 278 Organizational Behavior • Do you agree that words mean different things to different people? • How large was the range of responses for each of the questions? Why was this? • Did this surprise you? Why or why not? What can you apply from this exercise to make you a better communicator? Endnotes 1. Case written by Rachel Mattenberger, Talya Bauer, and Berrin Erdogan to accompany Bauer, T. N. & Erdogan, B. (2021). Organizational Behavior: Bridging Science and Practice (4.0). Boston, MA: FlatWorld. Partially based on ideas and information contained in Shoulberg, W. (2018). Why Ikea succeeds around the world while other retailers falter, https://www.forbes.com/sites/warrenshoulberg/2018/07/30/put-anotherstamp-on-the-ikea-passport/#69c48ca3f7cb; Pownall, A. (2018, September 5). Marcus Engman to leave IKEA and start own consultancy. Dezeen. Retrieved from https://www.dezeen.com/2018/09/05/ikea-head-ofdesign-marcus-engman-leaves/; Cohen, D. (2019). How Ikea got cool: The furniture giant’s rise from boring basics to hyped homegoods. https://www.esquire.com/lifestyle/a25998144/ikea-evolution-new-designcollaborations-collections; Attfield, P. (2019). CEO for a day: U of T student experiences Ikea Canada’s team culture. https://www.theglobeandmail.com/business/careers/management/article-ceo-for-a-day-u-of-t-student-experiences-ikea-canadas-team-culture; Pope, C. (2019). 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Retrieved from http://www.fastcompany.com/online/44/ intel.html and http://blogs.intel.com/it/2006/10/information_overload.php. 15. David, P., Xu, L., Srivastava, J., & Kim, J. H. (2013). Media multitasking between two conversational tasks. Computers in Human Behavior, 29, 1657-1663; Krisnan, A., Kurtzberg, T. R., & Naquin, C. E. (2014). The curse of the smartphone: Electronic multitasking in negotiations. Negotiation Journal, 30, 191-208. 16. Wright, N. (n.d.). Keep it jargon-free. Retrieved from the Plain Language Action and Information Network website: http://www.plainlanguage.gov/ howto/wordsuggestions/jargonfree.cfm. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 17. Adapted from ideas in Adubato, S. (2005, March 13). Scrap the jargon…Now! Retrieved from The Star-Ledger website: http://www.standdeliver.com/star_ledger/050313.asp; Zazulak, S. (2017). 11 ways you can avoid English jargon at work. 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(2006, February 3). The effective emailer. Retrieved from How to Change the World website: http://blog.guykawasaki.com/2006/02/the_effective_e.html. 48. Kruger, J. (2005). Egocentrism over email: Can we communicate as well as we think? Journal of Personality and Social Psychology, 89, 925–936. 49. Snyder, R. A., & Morris, J. H. (1984). Organizational communication and performance. Journal of Applied Psychology, 69, 461–465; Kacmar, K. M., Witt, L. A., Zivnuska, S., & Gully, S. M. (2003). The interactive effect of leader-member exchange and communication frequency on performance ratings. Journal of Applied Psychology, 88, 764–772. 50. Krackhardt, D., & Porter, L. W. (1986). The snowball effect: Turnover embedded in communication networks. Journal of Applied Psychology, 71, 50–55. 51. Barnes, N. G., Mazzola, A., Killeen, M. (2020, January 9). Oversaturation and disengagement: The 2019 Fortune 500 social media dance. Retrieved from https://www.umassd.edu/cmr/research/2019-fortune-500.html; Nanji, A. (2017). Social media and blog usage by Fortune 500 companies in 2017. Retrieved from https://www.marketingprofs.com/charts/2017/ 33156/social-media-and-blog-usage-by-fortune-500-companies-in-2017 52. Chief blogging officer title catching on with corporations. (2008, May 1). Workforce Management. Retrieved from http://www.workforce.com/ section/00/article/25/50/77.html. 53. Michelman, P. (2004, December 13). Sharing news that might be bad. Harvard Business School Working Knowledge website. Retrieved from http://hbswk.hbs.edu/item/4538.html. 54. Holusha, J. (1989, April 4). Exxon’s public-relations problem. New York Times. Retrieved from http://query.nytimes.com/gst/fullpage.html?res= 950DE1DA1031F932A15757C0A96F948260. 55. Kaye, B., & Jordan-Evans, S. (2008, September 11). Tell them the truth. Fast Company. Retrieved from http://www.fastcompany.com/resources/ talent/bksje/092107-tellthemthetruth.html. 56. Robert, Y. (2020). Here's why you're feeling Zoom Fatigue. Forbes. Retrieved from https://www.forbes.com/sites/yolarobert1/2020/04/30/ heres-why-youre-feeling-zoom-fatigue/#1e8d4f892ac6 57. Fosslien, L., & Duff, M. W. (2020). How to combat Zoom Fatigue. Harvard Business Review. Retrieved from https://hbr.org/2020/04/how-to-combat-zoom-fatigue 58. Garner, E. (2007, December 3). Seven barriers to great communication. Retrieved from Hodu.com http://www.hodu.com/barriers.shtml. 279 59. Effective communication. (2004, May 31). Retrieved from DynamicFlight.com: http://www.dynamicflight.com/avcfibook/communication. 60. Lifland, S. (2006). Multicultural communication tips. American Management Association. Retrieved from http://www.amanet.org/movingahead/ editorial.cfm?Ed=37&BNKNAVID=24&display=1. 61. This section draws on work by Hall, E. (1976). Beyond culture. Garden City, NY: Doubleday; and ideas in Munter, M. (1993). Cross-cultural communication for managers. Business Horizons, 36, 69–78. 62. Connor, J., Yi, M., & Iyengar, R. (April, 2013). When East meets West. T+D, 67, 54. 63. Chinese culture—differences and taboos. (n.d.). Retrieved from the Footprints Recruiting Inc. http://www.footprintsrecruiting.com/content_321. php?abarcar_Session=2284f8a72fa606078aed24b8218f08b9. 64. Case written by Berrin Erdogan and Talya Bauer to accompany Bauer, T. N., & Erdogan, B. (2021). Organizational Behavior: Bridging Science and Practice (4.0). Boston, MA: FlatWorld. Partially based on ideas and information contained in Amico, L. (September 29, 2017). Loneliness and the digital workplace. Harvard Business Review. Retrieved from https://hbr.org/cover-story/2017/09/work-and-the-loneliness-epidemic#/2017/09/loneliness-and-the-digital-workplace; Dishman, L. (April 25, 2018). Are your Slack chats accidentally destroying your work culture? Retrieved from https://www.fastcompany.com/40560336/are-your-slackchats-accidentally-destroying-your-work-culture; Kraus, R. (February 16, 2018). Beware! Slack leaks are the new email leaks. Retrieved from https://mashable.com/2018/02/16/slack-leaks-new-emailleaks/#X27MMzfrSiq8; Fessler, L. (March 28, 2018). Retrieved from https://work.qz.com/1238413/slack-analytics-will-soon-know-if-youspeak-to-men-and-women-differently/; Slack is developing tools to tell if someone's mansplaining. Lumb, D. (February 12, 2014). This story about Slack's founder says everything you need to know about him. Retrieved from https://www.fastcompany.com/3026418/this-story-aboutslacks-founder-says-everything-you-need-to-know-about-him; Moran, G. (October 12, 2017). These Slack habits are annoying your coworkers. Retrieved from https://www.fastcompany.com/40477106/these-slackhabits-are-annoying-your-coworkers; Pickard, A. (April 16, 2018). How technology is changing communication in the workplace. Retrieved from https://www.forbes.com/sites/quora/2018/04/16/how-technology-ischanging-communication-in-the-workplace/#62f8e2311a15; Slack. (2020, June 4). Slack announces record first quarter fiscal year 2021 results [News release]. Retrieved from https://investor.slackhq.com/news/ news-details/2020/Slack-Announces-Record-First-Quarter-FiscalYear-2021-Results/; Chan, R. (2019, October 10). Slack says that while its user numbers still lag Microsoft’s, what really matters is that users love its app a lot. Business Insider. Retrieved from https://www.businessinsider.com/slack-daily-active-users-microsoft-teams-2019-10 65. Beucke, D. (April 20, 2012). Aviva fires everyone: Great moments in employee motivation. Retrieved from http://www.businessweek.com/articles/2012-04-20/aviva-fires-everyone-great-moments-in-employee-motivation; Dishman, L. You’re fired: How to handle mass layoffs with respect. Retrieved from http://www.fastcompany.com/3026214/leadership-now/ youre-fired-how-to-handle-mass-layoffs-with-respect; Hastings, D. (December 24, 2013). Every employee at Chicago sandwich shop fired just before Christmas – via email. Retrieved from http://www.nydailynews.com/news/national/entire-staff-chicago-sandwich-shop-firedchristmas-article-1.1557338; Putre, L. (March 9, 2011). How Hugo Boss lost a Cleveland union battle. Pacific Standard; Weiss, T. (8/31/2006). You’ve got mail: You’re fired. Forbes. Retrieved from http://www.forbes.com/2006/08/31/leadership-radio-shack-management-cx_tw_0831layoffs.html. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 280 Organizational Behavior © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. CHAPTER 9 Groups and Teams at Work Shutterstock.com Learning Objectives After reading this chapter, you should be able to do the following: 1. Recognize and understand group dynamics and development. 2. Understand the difference between groups and teams. 3. Compare and contrast different types of teams. 4. Understand how to design effective teams. 5. Understand connections between groups and teams at work and ethics, technology, and cross-cultural management. When you consider the major accomplishments throughout history, it is clear that teams matter. While individuals can make powerful differences in terms of motivating, inspiring, or leading others, it is hard to imagine landing on the moon, delivering packages around the world, building multibillion dollar organizations, or global networks of aid without reliance on groups and teams. It is the coordinated effort of individuals in a variety of teams and groupings that makes such things possible. As students of Organizational Behavior, you probably already have some experience with groups and teams even if you don’t have a great deal of work experience. For example, team assignments and projects are one way you may have been exposed to teamwork. You might volunteer. Or you may have considerable experience due to your own work history. Regardless of how much experience you already have, this chapter may be helpful in terms of taking time to think about how to be more effective in your teams, both as a member and leader, in the future. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 282 Organizational Behavior 9.1 Building Teams with Kindness: The Case of Kind Daniel Lubetzky, Founder and Executive Chairman of Kind LLC Source: https://commons.wikimedia.org/wiki/Category:Daniel_Lubetzky#/media/ File:Daniel_Lubetzky_(April_14,_2015).jpg. CCL 2.0. Kind LLC is a food company that sells products such as snack bars, granola bars, and granola. Daniel Lubetsky, an immigrant from Mexico and the son of a holocaust survivor, founded the company in 2004. When he was a child, his father recounted stories about his experiences during the holocaust. One story in particular, about a surprising act of kindness his father encountered from a German soldier, inspired Lubetsky to build a company that would encourage people to live kinder lives. Lubetsky first founded PeaceWorks, another food company whose mission is to support peace through economic cooperation and unlikely supply chain partnerships. While traveling the world in support of PeaceWorks, Lubetsky recognized a need for healthier, tastier snacks for people on the go. Thus, he created Kind. Kind’s stated mission is to make the world a little kinder, and it aims to accomplish this by starting with its workplace culture. Kind employs approximately 500 people, endearingly referred to by Lubetsky as “team members,” to acknowledge their shared contribution toward achieving the company’s goals. The company’s values include ownership, teamwork, transparency, caring, and developing self & others. According to Lubetsky, Kind’s culture is founded on constructive feedback. Team members are expected to communicate openly and honestly and are encouraged to provide candid feedback to one another, regardless of title or rank. This communication framework helps to create a culture of trust, loyalty, and professional development. Lubetsky also encourages a culture of empathy, which is manifested by the company demonstrating to team members that it cares about them as people, not just as professionals. One example of this is the “KINDOs” program, which encourages team members to formally celebrate each other each month for acting in a way that aligns with the company’s values. Kind leadership also does their best to avoid letting people go. In most cases, rather than team members being fired, they will have an opportunity to develop the skills necessary to thrive in their role or they will be reassigned to a role that better fits their interests or skills. Finally, teams at Kind are expected to share ownership in accomplishing the tasks necessary to succeed. This means that everybody in the company, regardless of role or position, is expected to get their hands dirty. According to Lubetsky, who took on many different operational roles when founding the company, “. . . there’s no task too small or insignificant for me—or any of us—to do.”[1] © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 9 Groups and Teams at Work Multimedia Extension—What Makes Us Kind View in the online reader Case Discussion Questions 1. Kind’s mission is to “make the world a little kinder, one snack at a time.” How does the organization demonstrate this mission in the way it treats its employees? 2. How do you think values such as honesty, empathy, and shared ownership impact the way teams work together? What other values have you experienced that contribute to effective teamwork? 3. One key aspect of Kind’s culture is constructive feedback, regardless of employee seniority. What are some of the positive outcomes of this type of culture? What are some potential difficulties? 4. In what ways do you think Daniel Lubetsky’s childhood experiences might impact his current leadership style? What effect do you think this has on his teams? 5. How would you describe the nuances between the terms, “employees” and “team members?” Do you think this type of vocabulary matters to members of an organization? 9.2 Group Dynamics Learning Objectives 1. Understand the difference between informal and formal groups. 2. Learn the stages of group development. 3. Identify examples of the punctuated equilibrium model. 4. Learn how group cohesion affects groups. 5. Learn how social loafing affects groups. 6. Learn how collective efficacy affects groups. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. 283 284 Organizational Behavior Types of Groups: Formal and Informal Employees at Google are encouraged to find microcommunities by joining interest groups with fellow Googlers. There are “Gleeglers” who sing together, “Snowglers” who ski together, and “Greyglers” (older Google employees) who share interests and support each other. Shawn Goldberg/Shutterstock. com A group is a collection of individuals who interact with each other such that one person’s actions have an impact on the others. In organizations, most work is done within groups. How groups function has important implications for organizational productivity. Groups where people get along, feel the desire to contribute to the team, and are capable of coordinating their efforts may have high performance levels, whereas teams characterized by extreme levels of conflict or hostility may demoralize members of the workforce. In organizations, you may encounter different types of groups. Informal work groups are made up of two or more individuals who are associated with one another in ways not prescribed by the formal organization. For example, a few people in the company who get together to play tennis on the weekend would be considered an informal group. A formal work group is made up of managers, subordinates, or both with close associations among group members that influence the behavior of individuals in the group. We will discuss many different types of formal work groups later on in this chapter. Stages of Group Development group A collection of individuals who interact with each other such that one person’s actions have an impact on the others. informal work groups Two or more individuals who are associated with one another in ways not prescribed by the formal organization. formal work group Is made up of managers, subordinates, or both with close associations among group members that influence the behavior of individuals in the group. Forming, Storming, Norming, and Performing American organizational psychologist Bruce Tuckman presented a well-known model of group development in 1965 that is still widely used today. Based on his observations of group behavior in a variety of settings, he proposed a four-stage map of group evolution, also known as the formingstorming-norming-performing model.[2] He later enhanced the model by adding a fifth and final stage, the adjourning phase. Just as an individual moves through developmental stages such as childhood, adolescence, and adulthood, so does a group, although in a much shorter period of time. According to this theory, in order to successfully facilitate a group, the leader needs to move through various leadership styles over time. Generally, this is accomplished by first being more directive, eventually serving as a coach, and later, once the group is able to assume more power and responsibility for itself, shifting to a delegator. While research has not confirmed that this is descriptive of how groups progress, knowing and following these steps can help groups be more effective. For example, groups that do not go through the storming phase early on will often return to this stage toward the end of the group process to address unresolved issues. Another example of the validity of the group development model involves groups that take the time to get to know each other socially in the forming stage. When this occurs, groups tend to handle future challenges better because the individuals have an understanding of each other’s needs. FIGURE 9.1 Stages of the Group Development Model © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. Chapter 9 Groups and Teams at Work 285 Forming In the forming stage, the group comes together for the first time. The members may already know each other or they may be total strangers. In either case, there is a level of formality, some anxiety, and a degree of guardedness as group members are not sure how they will fit into the group or how work will be conducted. “Will I be accepted? What will my role be? Who has the power in this group?” These are some of the questions participants think about during this stage of group formation. forming Stage when the group comes together for the first time. Because of the large amount of uncertainty, members tend to be polite, conflict avoidant, and observant. They are trying to figure out the “rules of the game” without being too vulnerable. At this point, they may also be quite excited and optimistic about the task at hand, perhaps experiencing a level of pride at being chosen to join a particular group. Group members are trying to achieve several goals at this stage, although this may not necessarily be done consciously. First, they are trying to get to know each other. Often this can be accomplished by finding some common ground. Members also begin to explore group boundaries to determine what will be considered acceptable behavior. “Can I interrupt? Can I leave when I feel like it?” This trial phase may also involve testing the appointed leader or seeing if a leader emerges from the group. At this point, group members are also discovering how the group will work in terms of what needs to be done and who will be responsible for each task. This stage is often characterized by abstract discussions about issues to be addressed by the group; those who like to get moving can become impatient with this part of the process. This phase is usually short in duration, perhaps a meeting or two. Storming Once group members feel sufficiently safe and included, they tend to enter the storming phase. Participants focus less on keeping their guard up as they shed social facades, becoming more authentic and more argumentative. Group members begin to explore their power and influence, and they often stake out their territory by differentiating themselves from the other group members rather than seeking common ground. Discussions can become heated as participants raise contending points of view and values, or argue over how tasks should be done and who is assigned to them. It is not unusual for group members to become defensive, competitive, or jealous. Group members may even take sides or begin to form cliques within the group. Questioning and resisting direction from the leader is also quite common. “Why should I have to do this? Who designed this project in the first place? Why do I have to listen to you?” Although little seems to get accomplished at this stage, group members are becoming more authentic as they express their deeper thoughts and feelings. What they are really exploring is “Can I truly be me, have power, and be accepted?” During this chaotic stage, a great deal of creative energy that was previously buried is released and available for use, but it takes skill to move the group from storming to norming. In many cases, the group gets stuck in the storming phase. © 2021 Boston Academic Publishing, Inc., d.b.a FlatWorld. All rights reserved. storming Stage when participants focus less on keeping their guard up as they shed social facades, becoming more authentic and more argumentative. 286 Organizational Behavior OB Toolbox: Avoid Getting Stuck in the Storming Phase! Shutterstock.com There are several steps you can take to avoid getting stuck in the storming phase of group development. Try the following if you feel the group process you are involved in is not progressing: • Normalize conflict. Let members know this is a natural phase in the group-formation process. • Be inclusive. Continue to make all members feel included and invite all views into the room. Mention how diverse ideas and opinions help foster creativity and innovation. • Make sure everyone is heard. Facilitate heated discussions and help participants understand each other. • Support all group members. This is especially important for those who feel more insecure. • Remain positive. This is a key point to remember about the group’s ability to accomplish its goal. • Don’t rush the group’s development. Remember that working through the storming stage can take several meetings. Once group members discover that they can be authentic and that the group is capable of handling differences without dissolving, they are ready to enter the next stage, norming. Norming norming Stage when participants find it easy to establish their own ground rules (or norms) and define their operating procedures and goals. Group members often feel relief at the norming stage, and they are much more committed to each other and the group's goal. Feeling energized, group members are now ready to get to work. Finding themselves more cohesive and cooperative, participants find it easy to establish their own ground rules (or norms) and define their operating procedures and goals. The group tends to make big decisions, while subgroups or individuals handle the smaller decisions. Hopefully, at this point the group members are more open and respectful toward each other, and members ask each other for both help and feedback. They may even begin to form friendships and share more personal information with each other. At this point, the leader should become more of a facilitator by stepping back and letting the group assume more responsibility for its goal. Since the group’s energy is running high, this is an ideal time to host a social or team-building event. Performing performing Stage when participants are not only getting the work done, but they also pay greater attention to how they are doing it. Galvanized by a sense of shared vision and a feeling of unity, the group is ready to go into high gear. Members are more interdependent, individuality and differences are respected, and group members feel themselves to be part of a greater entity. At the performing stage, participants are not only getting the work done, but they also pay greater attention to how they are doing it. They ask questions like, “Do our operating procedures best support productivity and quality assurance? Do we have suitable means for addressing differences that arise so we can preempt destructive conflicts? Are we relating to and communicating with each other in ways that enhance group dynamics and help us achieve our goals? How can I further develop as a person to become more effective?” By © 2021 Boston

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