Management thought and ob

1. What is Organizational Behavior?
According to Stephen P Robbins - “Organizational behavior is a field of study that
investigates the impact that individuals, groups, and structure have on behaviors
within the organizations for the purpose of applying such knowledge towards
improving an organization’s effectiveness”.

2. Why OB?
• Responding to Economic Pressures
• Responding to Globalization
• Increased Foreign Assignments
• Working with People from Different Cultures
• Overseeing the Movement of Jobs to Countries with Low-Cost Labor
1.Manager understands the organizational impacts of individual and group behaviors.
2.Managers are more effective in motivating their subordinates.
3.Relationships are better between management and employees.
4.Managers are able to predict and control employee behavior.
5.The organization is able to make optimally efficient use of human resources.
Organizational benefits when managers have a strong foundation in OB:

3. Often, when organizations go through inevitable slumps or downturns,
they bring in experts in organizational behavior for guidance. This
practice exemplifies the importance of learning the fundamental
concepts in this discipline.

4. The driving force behind the evolution of management theory
is the search for better ways to utilize organizational
resources.

5. Management?
It is the process of designing and maintaining an environment in which individuals,
working together in groups, efficiently accomplish selected aims.
• As managers, people carry out the managerial functions of planning, organizing, staffing, leading,
and controlling.
• Management applies to any kind of organization.
• It applies to managers at all organizational levels.
• The aim of all managers is the same: to create a surplus.
• Managing is concerned with productivity, which implies effectiveness and efficiency

6. Classical
Approach
• Scientific Management
• Administrative Management
• Bureaucratic Management
Behavioral
Approach
• Maslow’s Need Theory
• Theory X & Theory Y
• Hawthorne studies
Quantitative
Approach
• Management Science
• Operations Management
• Management Information System
Major Classification of Approaches to Management
Modern
Approach
• The Systems Theory
• The Contingency Theory

7. Three distinct Schools of Management
• Classical Process
• Behavioural People
• Modern Integrative – (People, Process, Environment)

9. THE CLASSICAL SCHOOL OF MANAGEMENT
Core Ideas
1. Application of science to the practice of management.
2. Development of basic management functions.
3. Articulation and application of specific principles of management.
Evolved in response to the shift from handicraft to industrial production.
Emphasis is on the economic rationality of people and organizations; motivated by
economic incentives, they make choices that yield the greatest monetary benefits.

10. Frederick Taylor - 1911
“Principles of Scientific Management” - The Scientific School of Management
• Proposed to identify “the one best way” of doing a job using scientific selection and training
methods; cooperation and clear division of responsibility between managers and workers; pay for
performance.
• Taylor believed that if the amount of time and effort that each worker expends to produce a unit
of output can be reduced by increasing specialization, redesigning the work process and division of
labor, the production process will become more efficient.
• Codify the new methods of performing tasks into written rules and standard operating procedures.

11. Frank & Lillian Gilbreth 1912 - 1924
Time and Motion Studies
Disciples of Frederick Taylor, their time and motion studies helped lay the foundations for
Scientific Management – the best possible way for a worker to complete a job.
The expected results are employee satisfaction, productivity, and efficiency.
Scientific Management

12. Henry Gantt 1910 - 1915
Project Scheduling – The Gantt Chart
• An associate of Frederick Taylor, he designed a project scheduling model for
increasing the efficiency of project execution and completion.
Scientific Management

13. This scientific management became nationally known, but the
selective implementation of the principles created
more harm than good.

14. Because…
• Workers felt that as their performance increased, managers required them to do more
work for the same pay.
• Increases in performance meant fewer jobs and a greater threat of layoffs
• Monotonous and repetitive
• Dissatisfaction

15. Criticisms of The Classical School of Management
• No one is entirely driven by economic motivations.
• People’s choices and behavior are dictated by other factors such as social needs,
security, and self-esteem.
• There is no such thing as “the best way” to do a job.
• Extreme division of labor tends to produce monotony and reduce overall skill levels.
• People managed like machines. The introduction of newer machines led to job
elimination.

16. Henri Fayol 1916 - The Administrative School of
Management
Managers need specific roles in order to manage work and workers.
Fayol’s Principles of Management - He enumerated 6 functions/roles of management.
1. Forecasting
2. Planning
3. Organizing
4. Commanding
5. Coordinating
6. Controlling

17. Fayol’s Principles of Management
1. Division of Labour
2. Authority and Responsibility
3. Unity of Command
4. Line of Authority
5. Centralization
6. Unity of Direction
7. Equity
8. Order
9. Initiative
10. Discipline
11. Remuneration of Personnel
12. Stability of tenure of Personnel
13. Subordination of Individual Interests to the Common
Interest
14. Esprit de Corps

18. Max Webber 1905 (Theory of Bureaucracy)
Developed the principles of bureaucracy- a formal system of organization and administration
designed to ensure efficiency and effectiveness. A major contribution is his “bureaucracy”
theory, a formalized and idealized view of organizations, comprising major principles.
• A Manager’s formal authority derives from the position he holds.
• Positions to be given on basis of performance, not on social standing or personal contacts.
• Scope of each position’s formal authority & task responsibilities and its relationship to other
positions in an organization, should be clearly specified.
• To effectively exercise authority positions should be arranged hierarchically, so employees are
aware of the line of reporting.
• Managers to create a well-defined system of rules, SOP, and norms to effectively control behavior.

19. Clearly specified
System of task and
Role relationships
Selection and evaluation
System that rewards
Employees fairly and
Equitably.
System of written rules
and
SOPs that specify how
Employees should
behave
Clearly specified
Hierarchy of
authority
A bureaucracy
Should have

20. Rules
• Formal written instructions that specify actions to be taken under different circumstances to
achieve specific goals.
• Rule: At the end of the day employees are to leave their machines in good order.
Standard Operating Procedures
• Specific sets of written instructions about how to perform a certain aspect of a task.
SOP: Specifies exactly how they should do so, and which machine parts should be oiled or replaced.
Norms
Norms are unwritten, informal codes of conduct that prescribe how people should act in particular
situations.
E.g.: An organizational norm in a restaurant might be that waiters should help each
other if time permits.

22. THE BEHAVIORAL SCHOOL OF MANAGEMENT - 1920 - 1930
Core Concepts - Grew in reaction against the Scientific Theory of Management which emphasized
standardization of jobs, processes, and technologies to maximize economic return. Focus shifted to
the human side of organizations.
The study of how managers should behave to motivate employees and encourage them to perform
at high levels and be committed.
1. The best way to motivate, structure, and support employees.
2. The need for workers to find intrinsic value in their jobs.
3. The positive impact of social relationships on worker productivity.
4. The fulfillment of the emotional needs of workers is important in achieving economic goals.
5. Employee satisfaction and working conditions are important in achieving worker productivity.
6. Workers are intrinsically motivated to work when they feel a sense of belonging and participate in decision-
making.
7. Workers desire diverse and challenging work.

23. Abraham Maslow – 1954 –
“Motivation and Personality”

24. Douglas McGregor – 1960 - “Human side of Enterprise”
His theory X and Theory Y proposed two sets of assumptions about how work attitudes and behaviors not only
dominate the way managers think but also affect how they behave in organizations.
Theory X Managers
• Workers must be coerced and controlled to work
towards organizational goals.
• Workers are inherently lazy, lack ambition, and
prefer to be directed rather than take
responsibility.
• Workers are self-centered and only care about
themselves, not the organization.
• Workers dislike change and will resist it at all costs.
Theory Y Managers
• On encouragement to develop their full
potential will work towards achieving
organizational goals.
• With appropriate incentives and support,
workers will seek out and fulfill responsibilities
on their own.
• Workers will apply their ingenuity, creativity,
and hard work to meet organizational goals.
Caution: Self-Fulfilling Prophecy - Workers behave as expected by managers due to the manager’s own
behavior and actions.

25. Managers Who Accept Theory X
To keep performance high, workers must be
supervised closely and their behaviors be controlled
by means of “the carrot and stick”-rewards and
punishments
• Design and shape work setting to maximize
control over workers’ behaviors.
• Minimize the workers’ control over the pace of
work.
• Focus is on the development of rules, SOPs, and a
well-defined system of reward and punishment to
control behavior.
• Managers see little point in giving autonomy to
solve their own problems.
• Managers see their role as closely monitoring
workers.
Managers Who Accept Theory Y
• Decentralize authority
• More control of workers over their jobs
• Remain accountable for their jobs
• Managers’ role is not to control but to provide
support and advice and to evaluate them on their
ability

26. To Summarize -
• Behavioral School is a logical extension of the Human Resource School.
• They are largely concerned with the motivation of workers.
• Workers are diverse in their needs and want challenging work,
participative decision-making, self-direction, and control.
• Managers must help workers deal with situational constraints and
social aspects of organizational and environmental changes.

27. The Hawthorne Studies

28. The Hawthorne experiment - ELTON MAYO -FATHER OF HUMAN RELATION APPROACH
• It was conducted on workers at the Hawthorne plant of the Western Electric Company, Chicago
by Elton Mayo and Fritz Roethlisberger and T.N. Whitehead in the 1920s.
• Original aim was to study the relationship between productivity and physical working conditions.
The research was conducted in 4 phases :
PHASE 1: ILLUMINATION EXPERIMENT (1924-27)
PHASE 2: RELAY ASSEMBLY TEST ROOM EXPERIMENT (1927-28)
PHASE 3: MASS INTERVIEWING PROGRAMME (1928-1930)
 PHASE 4: BANK WIRING OBSERVATION ROOM EXPERIMENT (1931-1932)

29. PHASE 1: ILLUMINATION EXPERIMENT (1924-27)
• Experiments were conducted on 2 groups of workers to find out how varying levels of illumination affected productivity.
• One group was exposed to varying intensities of illumination. Since this group was subjected to experimental changes, it
was termed the experimental group.
• Another group, called the control group, continued to work under constant intensities of illumination.
• As illumination was increased in the experimental group, both groups increased production.
• When the intensity of illumination was decreased, the production continued to increase in
both groups.
• The production in the experimental group decreased only when the illumination was decreased to the level of moonlight.
The decrease was due to light falling much below the normal level.
• It was concluded that illumination did not impact productivity but something else was
interfering with it.
• It was inferred that the human factor was important in determining productivity but which aspect was affecting it, it was
not sure. Thus, another phase of experiments was undertaken

30. PHASE 2: RELAY ASSEMBLY TEST ROOM EXPERIMENT (1927-28)
• It was designed to determine the changes in various job conditions on group productivity.The researchers
set up a relay assembly test room and two girls were chosen who were asked to choose four more girls as
coworkers.
• The work related to the assembly of telephone relays. Each relay consisted of a number of
parts that girls assembled into finished products. Output depended on the speed and
continuity with which girls worked.
• The experiments started by introducing numerous changes in sequence with a duration of each change
ranging from four to twelve weeks.
• An observer was associated with girls to supervise their work. Before each change was introduced, the girls
were consulted. They were given the opportunity to express their viewpoints and concerns to the
supervisor.
• The incentive system was changed so that each girl's extra pay was based on the other five rather than the
output of a larger group, say, 100 workers or So. The productivity increased as compared to before.

31. • Two five-minute rests, one in the morning session and the other in the evening session were introduced which were
increased to ten minutes. The productivity increased.
• The rest period was reduced to five minutes but the frequency was increased. The productivity decreased
slightly and the girls complained that frequent rest intervals affected the rhythm of the work.
• The number of rest was reduced to two of ten minutes each, but in the morning, coffee or soup was served along with a
sandwich and in the evening, a snack was provided. The productivity increased.
• Changes in working hours and workday were introduced, such as cutting an hour off the end of the day and eliminating
Saturday work. The girls were allowed to leave at 4.30 p.m. instead of the usual 5. 00 p.m. and later at 4.00 p.m.
Productivity increased.
• As each change was introduced, absenteeism decreased, morale increased and less supervision
was required.. It was assumed that these positive factors were there because of the various
factors being adjusted and making them more positive.
• At this time, the researchers decided to revert back to the original position, that is, no rest and other
benefits. Surprisingly, productivity increased further instead of going down.
• Productivity increased not because of positive changes in physical factors but because of a
change in the girl's attitudes towards work and their workgroup. They developed a feeling of stability and
a sense of belongingness. Since there was more freedom of work, they developed a sense of responsibility and self-
discipline.The relationship between supervisor and workers became close and friendly.

32. PHASE - 3 MASS INTERVIEWING PROGRAMME (1928-1930)
• About 21,000 interviews were conducted to determine employees’ attitudes towards the
company, supervision, promotion, and wages.
• Initially, these interviews were conducted by means of direct questioning such as 'do you
like your supervisor? or is he in your opinion fair or does he have favorites? etc.
• Since this method had the disadvantage of either stimulating antagonism or the
oversimplified 'yes' or 'no’ responses could not get to the root of the problem, the
method was changed to non-directive interviewing where the interviewer was asked to
listen instead of talking, arguing, or advising.
• During the course of interviews, it was discovered that workers’ behavior was influenced by group
behavior. However, this conclusion was not very satisfactory and, therefore, researchers decided to
conduct another series of experiments

33. PHASE - 4 BANK WIRING OBSERVATION ROOM EXPERIMENT (1931-1932)
• It was carried out with a view to analyzing the functioning of small groups and its impact on
individual behavior.
• A group of 14 male workers was employed in the bank wiring room- 9 wiremen, 3 solder men and
2 inspectors
• The work involved attaching a wire to switches for certain equipment used in a telephone
exchange.
• Hourly wage rate for the personnel was based on average output of each worker while bonus was
to be determined on the basis of average group output.
• The hypothesis was that in order to earn more, workers would produce more and in order to take
the advantage of group bonuses, they would help each other to produce more.
• However, this hypothesis did not prove right.
• Workers decided the target for themselves which was lower than the company’s target, for
example, the group’s target for a day was connecting 6000 terminals against 7000 terminals set by
the company.

34. Workers’ reasons for restricted output:
• Fear of Unemployment. The basic reasoning of workers was that if there would be more production
per head, some of the workers would be put out of employment.
• Fear that once standard production was reached it would be raised further.
• Protection of Slower Workers By not overproducing – had family responsibilities, fear of retrenchment
• Satisfaction on the Part of Management. Workers believed, that management seemed to accept the
lower production rate as no one was being fired or even reprimanded for restricted output.
• The workers in the group set certain norms of behavior including personal conduct.
The workers whose behavior was in conformity with both output and social norms
were most preferred.
• This study suggested that informal relationships are an important factor in
determining human behavior.

35. IMPLICATION OF HAWTHORNE EXPERIMENT
• It introduced a new chapter in management by suggesting Management through good human
relations. (motivating people to develop teamwork for achieving organizational goals)
• Group Influence: Workers being social beings, create groups that may be different from their
official group. The group determines the norm of the behavior of members. Any deviation from the
group norm will make a worker unacceptable to the group.
• Conflicts: The informal relation of workers creates groups, and there may be a conflict between
organizations and groups so created due to incompatible objectives between the two.
• Leadership: is important for directing group behavior, and an important managerial function. At
times the informal leader is more important in directing group behavior
because of his identity with group objectives.

36. • Supervision: Supervisory climate is an important aspect in determining efficiency and output.
Friendly to the workers, attentive, genuinely concerned supervision affects productivity favorably.
• Communication:
• Workers can be explained the rationality of a particular action,
• Participation of workers can be sought in decision-making concerning the matter of their
importance.
• Problems faced by them can be identified and attempts can be made to remove these.
• A better understanding between management and workers can be developed by identifying their
attitudes opinions and methods of working and taking suitable actions on these.

37. CRITICISMS OF HAWTHORNE EXPERIMENTS
1. It did not give sufficient attention to the attitudes that people bring with them to the
workplace. They did not recognize such forces as class consciousness, the role of unions, and
other external forces on the attitudes of workers.
2. The Hawthorne plant was not a typical plant because it was a thoroughly unpleasant place to
work. So, the results could not be valid for others.
3. It considered the worker as a means to an end, and not an end himself. Looked at the worker
as someone to be manipulated by management.
▪ In spite of these shortcomings, Hawthorne’s experiments will be known for discovering the
importance of the human factor in managing the organization.

38. The Hawthorne Effect
• Productivity increases when workers believe that they are being
observed closely.
• Employees perform better when managers and co-workers make them
feel valued.
• Financial rewards are not necessarily conducive to increasing worker
productivity.
• Workers care about self-fulfillment, autonomy, empowerment, social
status and personal relationships with co-workers.

40. The Quantitative School of Management
• Combines classical management theory and behavioral science through the use
of statistical models and simulations. It combines rational thought with intuitive
insight to resolve management concerns such as cost, production, and service
levels.
• A major focus is on the process with which decisions are made, to ensure informed
results.

41. Characteristics of Management Science Approach:
• Functional relationships examination from an overview of systems.
• Interdisciplinary approach.
• Understand and uncover different problems for studies.
• Using the modeling process approach for solving problems.
• Application of science to decision-making.

42. Operations Management
• Operations Management - Operations management theory is the set of
practices companies use to increase efficiency in production.
• Operations management is concerned with controlling the production process and
business operations in the most efficient manner possible.
• They do this in majorly in four different ways known as the Four V’s,-
Volume, Variety, Variation, and Visibility

43. Management Information System (MIS) - is an information system used for decision-making, and for the
coordination, control, analysis, and visualization of information in an organization.
It involves people, processes, and technology in an organizational context.
There are 4 types of MIS
• Transaction Processing System (TPS), - processes the routine transactions associated with a business.
Example transactions include payroll processing, order processing, such as for an e-commerce business, and
invoicing.
• Management Support Systems (MSS), - store and organize data, enabling end-users to generate reports
and analyze data to address business needs and inform planning. A data warehouse is an example of a
Management Support System.
• Decision Support Systems (DSS), which analyze business data to assist managers with decision making. For
example, a DSS could project revenue figures based on new product sales assumptions.
• Expert Systems, which provide managers with insights and advice, using artificial intelligence (AI) to simulate
the expert knowledge of a human in a particular field.

45. THE MODERN SCHOOL OF MANAGEMENT
Core Concepts
• Dealing with complexity is the core of modern management theory.
• Organizations, Workers, Environment, and the interactions between them.
It is a synthesis of several theories.
• Behavioral science, mathematics, statistics, operations / quantitative research, and computing
technologies.
• Management is an exercise in logic applied to situations.
• Situations can be measured.
• Computers have an increasing role to play.
• Application of management knowledge is extended to non-business areas. Education,
government, health care, and others.

46. The Systems School of Management - Ludwig von Bertalanffy 1937
(General Systems Theory)
The Environment in which the system operates.
Environmental elements have the potential to affect all or part of the system
ORGANIZATION AS AN OPEN SYSTEM

47. Systems Approach
• A set of interrelated and interdependent parts arranged in a manner that produces a
unified whole.
• A system is basically a combination of parts (subsystem). Each part may have various
sub-parts.
• An organization is a system of mutually dependent parts, each of which may include
many subsystems.
• The systems approach implies that decisions and actions in one organizational area will affect
other areas. For example, if the purchasing department does not acquire the right quantity and
quality of inputs, the production department won’t be able to do its job.
• This approach recognizes that an organization relies on the environment for essential
inputs. Further, the environment serves as an outlet for its outputs.

48. Primary Characteristics of an Organizational System?
• Sub-Systems - Each organization is a system made up of a combination of many sub-systems.
These sub-systems are interrelated.
• Holism – Each sub-system works together to make up a single whole system. Decisions
made in any subsystem affect the entire system.
• Synergy – The collective output of the whole system is greater than the sum of the output of its
sub-systems.
• Closed and Open Systems - The whole organization is an open system made up of a combination
of open and closed sub-systems.
Closed systems - are not influenced by and do not interact with their environment (all system
input and output is internal).
Open systems - Dynamically interact with their environments by taking in inputs and transforming
them into outputs that are distributed into their environments.
• System Boundary - The organization is separate from the external environment made up of
other systems.

49. Advantages of a Systems Approach
• It aims at the meaningful analysis of organizations and their management.
• It facilitates the interaction between an organization and its environment.
• It guides managers to avoid analyzing problems in isolation and to develop an integrated
approach.
Disadvantages
• This approach is somewhat abstract and vague.
• It can be difficult to apply to large and complex organizations.
• It does not provide any tool and technique for managers.
• It is not a prescriptive management theory, as it does not specify tools and techniques for
practicing managers
• It does not address power and social inequalities and their causes.
• It does not specify the nature of interactions and interdependencies.

50. The Contingency Theory -
It claims that there is no best way to organize a corporation, lead a company, or make
decisions. Instead, the optimal course of action is contingent (dependent) on the
internal and external situation.
The basic assumptions of contingency theories of leadership are that a leader's effectiveness
depends on the leadership style required by the situation. The theory is that a leader can be
effective in one situation and ineffective in another, depending on what the situation requires.
They include :
• Fiedler's Contingency Theory,
• Situational Leadership Theory,
• Path-Goal Theory, and
• Decision-Making Theory.
Modern
Approach
• The Systems Theory
• The Contingency Theory

51. Fiedler Contingency Model – Created in the 1960s by Fred Fiedler,
• The model states that there is no one best style of leadership. Instead, a leader’s
effectiveness is based on the situation.
• This is the result of two factors – "leadership style" and "situational favorableness“
(later called "situational control").
According to Fred Fiedler effectiveness and leadership depend on a number of factors
including the situations and the personal characteristics of the leader.
Fiedler distinguished the following three factors:
1. Makeup of the group
2. Nature of the task
3. Power of the leader

52. LEADERSHIP STYLE
• Fiedler believed that leadership style is fixed, and it can be measured using a scale he
developed called Least-Preferred Co-Worker (LPC) Scale.
• The scale asks you to think about the person who you've least enjoyed working with.
• This can be a person who you've worked with in your job, or in education or training.
• You then rate how you feel about this person for each factor, and add up your scores.
• If your total score is high, you're likely to be a relationship-orientated leader. If your
total score is low, you're more likely to be a task-orientated leader.

53. Least Preferred Co-worker (LPC) Scale

54. LEAST-PREFERRED CO-WORKER SCALE
• The model says that task-oriented leaders usually view their LPCs more negatively, resulting
in a lower score. Fiedler called these low LPC leaders.
• He said that low LPCs are very effective at completing tasks. They're quick to organize a
group to get tasks and projects done. Relationship-building is a low priority.
• However, relationship-oriented leaders usually view their LPCs more positively, giving them a
higher score.
• These are high-LPC leaders. High LPCs focus more on personal connections, and they're good
at avoiding and managing conflict. They're better able to make complex decisions.

55. SITUATIONAL FAVORABLENESS
Next, we determine the "situational favorableness" of your particular situation.
This depends on three distinct factors:
• Leader-Member Relations – This is the level of trust and confidence that your team has in
you. A leader who is more trusted and has more influence on the group is in a more favorable
situation than a leader who is not trusted.
• Task Structure – refers to the type of task: clear and structured, or vague and unstructured.
Unstructured tasks, or tasks where the team and leader have little knowledge of how to
achieve them, are viewed unfavorably.
• Leader's Position Power – the power to direct the group and provide reward or punishment.
Higher power means a more favorable situation.

56. Fiedler’s Contingency Theory of Leadership

57. Applying Feilder Contingency Model
• Step 1: Identify your leadership style
• Step 2: Identify your situation
• Step 3: Determine the most effective leadership style

58. Criticism
• Lack of flexibility. Fiedler believed that because our natural leadership style is fixed,
the most effective way to handle situations is to change the leader. He didn't allow
for flexibility in leaders.
• If a low-LPC leader is in charge of a group with good relations and doing
unstructured tasks and he has a weak position (the fourth situation), then,
according to the model, the best solution is to replace him with a high-LPC leader –
instead of asking her to use a different leadership style.
• There is also an issue with the Least-Preferred Co-Worker Scale – if you fall near the
middle of the scoring range, then it could be unclear which style of leader you are.

59. The Situational Leadership Theory - Hersey-Blanchard
According to this theory, the most effective leaders are those that are able to adapt their style to the
situation and look at cues such as the type of task, the nature of the group, and other factors that might
contribute to getting the job done.
Hersey and Blanchard suggested that there are four primary leadership styles:
• Telling (S1): In this leadership style, the leader tells people what to do and how to do it.
• Selling (S2): This style involves more back-and-forth between leaders and followers. Leaders
"sell" their ideas and message to get group members to buy into the process.
• Participating (S3): In this approach, the leader offers less direction and allows members of the
group to take a more active role in coming up with ideas and making decisions.
• Delegating (S4): Less involved, hands-off approach to leadership. Group members tend to make
most of the decisions and take most of the responsibility for what happens.

61. Maturity Levels
• The right style of leadership depends greatly on the maturity level (i.e., the level
of knowledge and competence) of the individuals or group.
Matching Styles and Levels
• Low Maturity (M1) — Telling (S1)
• Medium Maturity (M2) — Selling (S2)
• Medium Maturity (M3) — Participating (S3)
• High Maturity (M4)—Delegating (S4)
Hersey and Blanchard's theory identifies
four different levels of maturity, including:
• M1: Group members lack the knowledge, skills,
and willingness to complete the task.
• M2: Group members are willing and enthusiastic,
but lack the ability.
• M3: Group members have the skills and
capability to complete the task, but are unwilling
to take responsibility.
• M4: Group members are highly skilled and willing
to complete the task.

62. Path-Goal Theory
In 1971, Robert House introduced his version of a contingent theory of leadership
known as the Path-Goal theory.
• It states that a leader’s behavior is contingent on the satisfaction,
motivation, and performance of their employees.
• The manager’s job is viewed as guiding workers to choose the best paths to reach
both their goals as well as the corporation’s goals.
• The theory argues that leaders will have to engage in different types of leadership
behavior depending on the nature and the demands of the situation at hand.

64. Decision-making theory
• It is a theory of how rational individuals should behave under risk and uncertainty.
• The theory suggests that decision-making means the adoption and application of rational
choice for the management of a private, business, or governmental organization in an
efficient manner.
Types of Decisions
• Programmed decision is one that is fairly structured or recurs with some frequency
(or both).
• Non-programmed decision is one that is unstructured and occurs much less often
than a programmed decision.

65. Decision-Making Conditions
• Decision Making Under Certainty
• Decision Making Under Risk
• Decision Making Under Uncertainty

66. The Classical Model of Decision Making

68. The Administrative Model of Decision Making
• Herbert A Simon, a Nobel Prize winner in Economics, developed the model to
describe how decisions are often made rather than to prescribe how they should be
made.
• Argues that decision-makers have incomplete and imperfect information, are
constrained by ‘bounded rationality, and tend to ‘satisfice’ when making decisions.
• Bounded rationality suggests that decision-makers are limited by their values and
unconscious reflexes, skills, and habits.

69. Behavioral Aspects. . .
• Satisficing is the tendency to search for alternatives only until one is
found that meets some minimum standard of sufficiency.
• Rather than conducting an exhaustive search for the best possible
alternative, decision-makers tend to search only until they identify an
alternative that meets some minimum standard of sufficiency.

70. Behavioral Forces Influencing Decisions
• Risk Propensity – the extent to which a decision-maker is willing to
gamble when making a decision.
• Organizational culture is a prime ingredient in encouraging different levels
of risk.
• Ethics

71. Fields contributing to OB

72. • Psychology - is the science that seeks to measure, explain, and sometimes change the behavior of humans
and other animals.
• Social psychology - is an area within psychology, but it blends concepts from psychology and sociology. It
focuses on the influence of people on one another.
• Sociology -Whereas psychologists focus on the individual, sociologists study the social system in
which individuals fill their roles; that is, sociology studies people in relation to other human beings.
• Anthropology - is the study of societies to learn about human beings and their activities.
Anthropologists’ work on cultures and environments, for instance, has helped us understand differences in
fundamental values, attitudes, and behavior between people in different countries and within different
organizations.
• Political science - studies the behavior of individuals and groups within a political environment. Specific
topics of concern include structuring of conflict, allocation of power, and the manipulation of power for
individual self-interest

73. Managers’ roles and functions
Henry Mintzberg in his classic book, The Nature of Managerial Work, describes a set
of ten roles that a manager fills. These roles fall into three categories:

74. Manager’s function

75. Planning
• According to KOONTZ, “Planning is deciding in advance - what to do, when to do & how
to do. It bridges the gap from where we are & where we want to be”. A plan is a future
course of action.
Organizing - as a process involves:
• Identification of activities.
• Classification of / grouping of activities.
• Assignment of duties.
• Delegation of authority and creation of responsibility.
• Coordinating authority and responsibility relationships.

76. Staffing
It is the function of manning the organization structure and keeping it manned.
It has assumed greater importance in recent years due to the advancement of technology,
increase in the size of business, the complexity of human behavior, etc.
The main purpose of staffing is to put the right man on the right job.
Staffing involves:
• Manpower Planning (estimating manpower in terms of searching, choosing the person, and giving
the right place).
• Recruitment, Selection & Placement.
• Training & Development.
• Remuneration.
• Performance Appraisal.
• Promotions & Transfer.

77. Directing
Direction deals directly with influencing, guiding, supervising, and motivating sub-ordinate
for the achievement of organizational goals.
Its elements:
• Supervision - implies overseeing the work of subordinates by their superiors. It is the act of
watching & directing work & workers.
• Motivation - inspiring, stimulating, or encouraging the subordinates with zeal to work. Positive,
negative, monetary, and non-monetary incentives may be used for this purpose.
• Leadership – may be defined as a process by which a manager guides and influences the work of
subordinates in the desired direction.
• Communications- is the process of passing information, experience, opinion, etc from one
person to another.

78. Controlling
“Controlling is the measurement & correction of performance activities of subordinates in
order to make sure that the enterprise objectives and plans desired are being accomplished”.
Steps:
• Establishment of standard performance.
• Measurement of actual performance.
• Comparison of actual performance with the standards and finding out deviation if any.
• Corrective action.

79. Effective Vs Successful Managerial Activities
Allocation of Activities by Time
32%
29%
20%
19%
Average Managers
Traditional Management
Communication
Human Resource Management
Networking

80. Workforce diversity
• DE&I
• “Workforce diversity is a workforce consisting of a broad mix of workers
from different racial and ethnic backgrounds of different ages and
genders, and of different domestic and national cultures.”
• It also signifies that the organizations are becoming a more
heterogeneous mix of people in terms of gender, age, ethnicity, and
sexual orientation.”

81. Elements of Diversity
• Age
• Gender
• Ethnicity
• Race
• Physical Ability
• Sexual Orientation
• Physical Characteristics
• Income
• Education
• Marital Status
• Religious Beliefs
• Geographic Location
• Parental Status
• Personality Type

82. Reasons for the emergence of diversity
• Changing the demographic structure of the workforce
• Government, legislation & lawsuits alleging discrimination
• Enhanced competitiveness of firms
• Increase globalization of firms
• Recognition and desire for diverse viewpoints

83. Top 10 Benefits of workplace diversity
1. Higher innovation
2. Better decision making
3. Higher employment engagement
4. Better company reputation
5. Faster problem solving
6. Reduced employee turnover
7. Increased creativity
8. Increased profits
9. Improved hiring results

84. Challenges of Diversity in the Workplace
• Communication
• Resistance to change
• Implementation of diversity in the workplace policies
• Successful Management of Diversity in the Workplace

85. Managing Diversity
Managing Diversity is defined as the “planning and implementing
organizational systems and practices to manage people so that the
potential advantages of diversity are maximized while its potential
disadvantages are minimized”

86. How to Manage Diversity in the Workplace
• Creation of a family-friendly workplace
• Providing diversity training to employees
• Developing mentoring programs for employees
• Implementation of diversity in the workplace plan
• Foster an attitude of openness in your organization
• Promote diversity in leadership positions

87. Tips for managing workplace diversity:
1. PRIORITIZE COMMUNICATION:
Policies, procedures, safety rules, and other important information should be designed to
overcome language and cultural barriers by translating materials and using pictures and
symbols whenever applicable.
2. TREAT EACH EMPLOYEE AS AN INDIVIDUAL:
Treat each employee as an individual & judge successes and failures on the individual’s merit
rather than attributing actions to their background.
3. ENCOURAGE EMPLOYEES TO WORK IN DIVERSE GROUPS:
This can help break down preconceived notions and cultural misunderstandings.

88. 4. BASE STANDARDS ON OBJECTIVE CRITERIA:
Set one standard of rules (ex – discipline) for all groups of employees regardless of
background.
5. BE OPEN-MINDED:
Recognize, and encourage employees to recognize, that one’s own experience,
background, and culture are not the only thing of value to the organization. Look for
ways to incorporate a diverse range of perspectives and talents into efforts to achieve
organizational goals.
6. HIRING: Hire talent from a variety of backgrounds. Overcome bias in interviewing and
assessing talent.

89. Tips for hiring a diverse workforce:
• Diverse interview panel to ensure candidates are chosen solely on suitability for the
position.
• Managers should be trained on what can and cannot be asked in an interview.
For example, questions about an applicant’s personal life, such as which church they
attend, their romantic life, and political beliefs, are off-limits.
• Get creative when recruiting.
For example, if an organization would like to hire more women in any department,
they could reach out and advertise in professional groups that cater to women in that
department.

90. Globalization in OB
• As organizations have become more global, their workforce has become
culturally diverse.
• From the OB point of view, the biggest concern for globalization is the impact and
influence of multinational companies that have expanded international communication
and imported various cross-cultural issues.
• Changes in the operational environment not only require focus on new products or
service developments, but also on the skills and competency sets, attitudes, values, and
cultures of the people.
• Such changes are primarily attributable to the shift in the expectations of customers
and the behavior of competitors.

91. • The consequential effect of globalization on organizations is an increase in
alliances and partnerships rather than on authority and control.
• This is characterized by the breakdown of tall hierarchies, increase in the use of teams,
reorganization of functional departments into cross-functional groups, reduction in
centralized control, and allowing more local autonomy.
• Another key aspect, is the harvesting of the knowledge of the people. This is facilitated by
knowledge management practices, using various tools, techniques, and values.
• Globalization has also changed the nature of managerial work, requiring managers, in the
globalized era, to increase their judgmental power, use persuasion and influence, shaping
of the behavior of the people, etc.