The study of organizations and of the
collection of people within them together
comprises the field of organizational
Organizational behavior (OB) is the study of
human behavior in organizational settings,
the interface between human behavior and
the organization, and the organization itself.l
3. Organizational Behavior is a field of study that
investigates the impact that individuals, groups,
and structure have on behavior within
organizations for the purpose of applying such
knowledge towards improving an organization's
4. What is Organizational Behavior?
Organizations are social systems.
Organization is a combination of humanity
OB is the study and application of
knowledge about how people act within the
It is a human tool for human benefit .
A complex set of forces affects the
nature of organizations today.
It can be classified into four areas:
When people join the organization to accomplish
the goals/ objectives, some kind of structure is
required. They use machinery, gadgets &
technology to achieve the organizational goals.
At the same time they are influenced by external
7. Organizations are defined as social arrangements,
constructed by people, who can also change them.
----Buchanan and Huczynski (1997)
Organizations are a system of cooperative activities -
and their coordination requires something intangible
and personal that is largely a matter of personal
---- Barnard (1938)
OB is concerned with “the study of the structure,
functioning and performance of organizations, and
the behavior of groups and individuals within them”.
---- Pugh (1971)
9. Nature of OB
A field of study and not a discipline
An Applied Science
Normative and Value Centered
Humanistic & optimistic
Oriented Towards Organizational Objectives
A total Systems Approach
10. Evolution of OB
Young Factory Owner-First to emphasize the human needs of
employees and refused to employ children
Taught workers to improve working conditions
Father of personnel management
The Philosophy of Manufacturers -1835
Value of human factor in manufacturing
Provided welfare facilities to workers
J.N. TATA in 1886 Instituted a pension fund & 1895 began to
pay accident compensation.
11. William Gilbreth-(1914)
“The Psychology of Management”
Father of Scientific Management
Time & Motion Study
Piece Rate Method
Evolution of OB
12. Henry Fayol (1916)
Administrative Management , Principle of Governing Behavior,
Elton Mayo-(1920’s & 1930’s)
Human behavior at Harvard University
Abraham H. Maslow (1954):
Need Hierarchy Motivation model
Douglas McGregor (1960):
Theory X and Theory Y Managerial Style
Henry Mintzberg (1960) :
Managerial Roles : Interpersonal, Informational and Decision
Evolution of OB
13. Peter Drucker (1909 -2005)
Father of modern management
Importance of change
How to bring best out of people
Evolution of OB
15. Major Contributing Disciplines to the field
of organizational Behavior
1. Psychology: how individuals behave in response to
2. Sociology: how individuals relate to groups and to
3. Social Psychology: How individuals and
organizations perceive conflict, threats and
4. Anthropology: understanding customs traditions
and social mores of people since the organization is
a microcosm of the larger society.
5. Political Science: Understanding Power,
Authority and Corporate Politics.
6. Economics: Appreciating monetary (wage
and bonus) and non monetary incentives
(housing, schooling and medical care) to
employees so that they are motivated to
produce more efficiently and effectively.
17. Challenges for OB
Globalization to Respond
Improving Quality and
Improving Customer Service
Improving People Skills
Stimulating Innovation and
Improving Ethical Behaviour
Coping with Temporariness
Working in network
Helping employees balance
Creating Positive work
Challenges and Opportunities in
The rise of global
Rapid advances in
people in general.
The process of interconnecting the
world’s people with respect to the
cultural, economic, political,
technological, and environmental
aspects of their lives.
Organizations that have significant
operations spread throughout various
nations but are headquartered in a single
Expatriates: People who are citizens of one country but
who are living and working in another country.
Culture: The set of values, customs, and beliefs that
people have in common with other members of a social
unit (e.g., a nation).
Culture shock: The tendency for people to become
confused and disoriented as they attempt to adjust to a
Repatriation: The process of readjusting to one’s own
culture after spending time away from it.
Convergence Hypothesis: A biased approach to
the study of management, which assumes that
principles of good management are universal,
and that ones that work well in the United
States will apply equally well in other nations.
Divergence Hypothesis: The approach to the
study of management that recognizes that
knowing how to manage most effectively
requires clear understanding of the culture in
which people work.
Responding to Changes in Technology
Creating Leaner Organizations
Downsizing/Rightsizing: The process of adjusting the number of
employees needed to work in newly designed organizations.
Outsourcing: The process of eliminating those parts of organizations
that focus on noncore sectors of the business and hiring outside firms
to perform these functions instead.
Creating Virtual Organizations
Highly flexible, temporary organizations formed by a group of
companies that join forces to exploit a specific opportunity.
Increasing the Use of Telecommuting
The practice of using communications technology so as to enable
work to be performed from remote locations.
Responding to Changes in Expectations
in Response to
Flextime Programs: Policies that give employees some discretion
over when they can arrive and leave work, thereby making it easier
to adapt their work schedules to the demands of their personal
The Contingent Workforce: People hired by organizations
temporarily to work as needed for finite periods of time.
Compressed Workweeks: The practice of working fewer days each
week but longer hours each day.
Job Sharing: A form of regular part-time work in which pairs of
employees assume the duties of a single job, splitting its
responsibilities, salary, and benefits in proportion to the time
Voluntary Reduced Work Time Programs: Programs that allow
employees to reduce the amount of time they work by a certain
amount, with a proportional reduction in pay.
The Quality Revolution
Total Quality Management: An organizational strategy
of commitment to improving customer satisfaction by
developing techniques to carefully manage output
Benchmarking: The process of comparing one’s own
products or services with the best from others.
Malcolm Baldridge Quality Award: An award given
annually to American companies that practice effective
quality management and make significant
improvements in the quality of their goods and services.
Corporate Social Responsibility
Business decision making
linked to ethical values,
compliance with legal
requirements, and respect for
individuals, the community
at large, and the
environment. It involves
operating a business in a
manner that meets or exceeds
the ethical, legal, and public
expectations that society has
Ethics in Organizations
Good ethics is good business
Improved financial performance
Reduced operating costs
Enhanced corporate reputation
Increased ability to attract and retain employees
Code of Ethics: A document describing what an organization
stands for and the general rules of conduct it expects of its
Ethics Officers: Individuals (usually at the vice presidential level)
who oversee the ethics of a company’s operations.
Ethics Audit: The process of actively investigating and
documenting incidents of dubious ethical value within a
1. Does the behavior violate
the obvious “shall nots”?
2. Will anyone get hurt?
3. What if you did it 100
4. How would you feel if
someone did it to you?
5. What’s your gut feeling?
6. Would the behavior pass
the “front page test”?
31. THE SCOPE OF THE ORGANIZATIONAL
BEHAVIOUR IS AS UNDER:
Impact of personality on performance
(b) Employee motivation
How to create effective teams and groups
Study of different organizational structures
Individual behaviour, attitude and learning
Design and development of effective organization
32. Importance of OB
OB provides a road map to our lives in organizations.
OB uses scientific research to understand and make
organization life, as it helps to predict what people will do
under various conditions
It helps to influence organizational events – to understand
and predict events
It helps individual understand herself/ himself in better
It helps manager to manage human resources effectively.
It helps organizations for maintaining cordial industrial
It is also useful in the field marketing.