Management of Organization Behavior

INDEX
TOPIC

SR SUB SR
NO.
NO.
1

PAGE
NO.

Introduction
1.1

Concept of Management

1.2

Concept of Organization Behavior

1.3

Management Practices in Organization Behavior

1.4

Foundation of Organization Behavior

Organizational Behavior
2.1

Nature of Organization Behavior

11

2.2

Features of Organization Behavior

13

2.3

Challenges in Organization Behavior

15

2.4

Role of Organization Behavior

20

Impact of Organization Behavior

3.1

Advantages of Organization Behavior

24

3.2

Disadvantages of Organization Behavior

26

3.3

Importance of Organization Behavior

28

3.4

Contemporary Organization Behavior

31

3.5

Approaches to Organization Behavior

34

3.5

Models of Organization Behavior

36

Case Study

40

Conclusion

42

Bibliography

43

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CONCEPT OF MANAGEMENT
A precise definition of management is not so simple because the term
management is used in a variety of ways. Being a new discipline, it has
drawn concepts and principles from a number of disciplines such as
economics, sociology, psychology, anthropology, statistics, and so on
The result is that each group of contributors has treated management
differently. For example economists have treated management as a factor
of production; sociologists have treated Its a class or group of persons;
practitioners have treated it as a process comprising different activities.
Naturally, all these divergent groups view the nature and scope of
management from their own point of view. Thus, taking all these points of
views together. It becomes difficult to define management in a
comprehensive way. In the present context, the term management is;
used in three alternative ways:
1. Management as a discipline,
2. Management as a group of people, and
3. Management as a process.
Management as a Discipline
Discipline refers to a field of study having well-defined concepts and
principles. When we refer to management as a discipline, we Include In it
the various relevant concepts and principles the knowledge of which aids in
managing. From this point of view, management can be treated either as
an art or science, the two basic and broad disciplines. However, since
management prescribes various principles and how these principles can be
applied in managing an organisation, it has the orientation of both, science
and art, a phenomenon which will be discussed later in this chapter.
Management as a Group of People
Sometimes, we refer to management as a group of people in which we
include all those personnel who perform managerial functions in
organisations. For example, when we talk about relationship between
management and labour in an organisation, we refer to two distinct
classes or groups of personnel in the organisation. In the first category, we
include all those persons who are responsible for managerial functions and
in the second category, we include non-managerial personnel. This
approach of using management is quite popular; however, it does not serve
our purpose of defining the term management

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Management as a Process
In studying management discipline, we generally refer to management as a
process. A process can simply be defined as a systematic method of
handling activities However, the management process can be treated as a
complex one which can be referred to as an identifiable flow of information
through Interrelated stages of analysis directed towards the achievement of
an objective or set of objectives. It is a concept of dynamic rather than
static existence in which events and relationships must be seen as
dynamic, continuous, and flexible, and as such, must be considered as a
whole. Thus, management as a process includes various activities
and sub activities. However, what these activities are must be defined
precisely to understand the exact nature and scope of management. In a
simple way, we can define management as what managers do

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CONCEPT OF ORGANIZATION BEHAVIOR

Organizations are collections of interacting and inter related human and
non-human resources working toward a common goal or set of goals within
the framework of structured relationships. Organizational behavior is
concerned with all aspects of how organizations influence the behavior of
individuals and how individuals in turn influence organizations.
Organizational behavior is an inter-disciplinary field that draws freely from a
number of the behavioral sciences, including anthropology, psychology,
sociology, and many others. The unique mission of organizational behavior
is to apply the concepts of behavioral sciences to the pressing problems of
management, and, more generally, to administrative theory and practice.
In approaching the problems of organizational behavior, there are a
number of available strategies we can utilize. Historically, the study of
management and organizations took a closed-systems view. The
preoccupation of this view is to maximize the efficiency of internal
operations. In doing so, the uncertainty of uncontrollable and external
environmental factors often were assumed away or denied. This traditional
closed-systems view of organizations made substantial contributions to the
theory of organizational design. At the same time, for analytical reasons,
organizations came to be viewed as precise and complex machines. In this
framework, human beings were reduced to components of the
organizational machine. More recently, the study of organizations and the
behavior of human beings within them have assumed a more opensystems perspective. Factors such as human sentiments and attitudes, as
well as technological and sociological forces originating outside the
organizations, have assumed greater importance in analyzing
organizational behavior. This book adopts the open perspective, because
this is a contemporary and more meaningful way to view organizations and
human behavior within them. After some preliminary issues, we shall
examine the individual. We shall move from the individual to the small
group, to the complex organization, and finally to some environmental
factors important to the process of organizational change
Organizational behavior is not a discipline in the usual sense of the term,
but is rather an eclectic field of study involving the integration of the
behavioral sciences (e.g., psychology, sociology, anthropology, etc.) into
the study of people's behavior within organizations. While those who
conduct research in organizational behavior often come from business
schools, they may have their roots in diverse areas such as political
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science, sociology, psychology, or anthropology. It is the integration of

relevant knowledge of these areas that has given us a new
field of study-organisational behaviour (frequently abbreviated as OB).
Aldag and Brief have defined OB as follows:
"Organisational behaviour is a branch of the social sciences that seeks to
build theories that can be applied to predicting, understanding, and
controlling behaviour in work organisations."
Callahan et al. have defined OB as a subset of management activities
when they state that,
"Organisational behaviour is a subset of management activities concerned
with under-standing, predicting, and influencing individual behaviour in
organisational settings
According to both these definitions, the basic ingredients of OB are the
same, that is, understanding, predicting, and controlling human behaviour
though both treat OB as a field of study in different formsa branch of the
social science or a subset of management activities. We can define OB as
follows:
Organisational behaviour is the study and application of knowledge about
human behavior related to other elements of the organisation such as
structure, technology and social system.
Thus, OB is primarily concerned with that aspect of human behaviour which
is relevant for organisational performance. It studies human behaviour at
individual level, group level, and organisational level. It applies the
knowledge gained about individuals, groups, and the effect of organisation
structure on behaviour towards the end of making organisations work
more effectively.

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MANAGEMENT PRACTICES IN ORGANIZATION BEHAVIOR

Many of the behavioural problems in organisations can be solved by
acquiring knowledge of OB and applying this knowledge properly. The
basic objective of studying OB is to acquire knowledge about how people
behave in the organisation and how this behaviour can be directed
towards the achievement of organisational objectives. For tills purpose,
various theories have been evolved. However, a common statement made
by managers Is, "that is fine In theory, but in practice. It does not work."
While this is true for the managers at the global level, Indian managers
have specific reasons to be dissatisfied with the theories developed in
industrially advanced countries and are followed in Indian context. These
managers may be correct in saying so as the theories they have applied
might not have worked. This state of affairs Is unfortunate since the real
world is the ultimate laboratory for the social scientists. If bad theories are
created that do not work the gap between theory and practice Is widened.
Therefore, it is important to identify the reasons why theories do not work in
practice.
Why Theories Fail?
It is true that many theories have failed to produce desired results in
practice; therefore, attempts are on to evolve new theories. However, the
reasons for the failure of theories are more important to analyze rather than
merely counting the occasions of their failures. If these reasons are
understood, managers can Improve their skills in choosing and
implementing theories. Some of the major reasons for failure of the theories
are as follows:
1. Lack of Proper Understanding of Theory. In many cases, the
individual trying a theory does not fully understand it. Lack of complete
understanding can cause the Individual to apply something other than
the theory in question, or to apply the theory in an inappropriate
situation, that is, using the correct solution for the wrong problem. For
example, often managers commit mistakes in applying job enrichment
concept enriching the job to make it more motivating; they may overload
it, or may enrich a job that is currently grossly underpaid In relation to
market conditions.
2. No Consideration given for Systems Effects. One of the most
common experiences of managers who try new theory is that while they
may solve the original problem, occasionally, new problems are created
as a result of the action, and the managers end up thinking they were
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3.

4.

5.

6.

better off before. This happens because theoretical models tend to

neglect the systems effect of introducing change into an organisation.
For example, a manager may enhance the status of a group to enhance
its productivity. It may work positively for the group but may create
problems for the other groups whose status gets reduced in relation to
the target group.
Lack of Specific Applicability of a Theory. Generally, theories are
developed using scientific methods on relatively large number of
observations. Consequently, theories developed tend to apply to
individuals collectively, but not to any one specific person. A manager
may attempt to apply a prescriptive statement from a general theory to a
specific situation that does not fit the general requirements of the theory.
For example, the theory states that money is not a motivator in general
term. However, It may be a motivator for an individual because of his
specific background.
Lack of Universal Applicability. A theory, particularly in management
and organisational behaviour which are affected by characteristics of
human beings which may differ from place to place, lacks universal
applicability. Thus, a theory developed in one situation may not be
applicable in another situation because variables in two situations may
be different. This aspect Is important for Indian managers when they
apply the theories developed abroad for managing Indian organisations.
Wrong Theory. Sometimes, wrong theory may be created. This may
happen because of several reasons: (i) the environmental conditions
under which the theory was created have changed; (ii) incorrect
conclusions have been drawn from right data; (iii) correct conclusions
have been drawn from poor data; and (iv) researchers have overlooked
other significant influences that affect the results. In such a situation, the
theory may not work at all.
Value of Theory: If we analyze the reasons for failure of theories, we
may find that reasons are two-fold: the application of theory is incorrect
because of lack of proper understanding, or the theory itself may be
faulty and lacks applicability. Therefore, the practitioners have to take
into consideration the reasons for failure of the theory and should not
ignore the reality by commenting 'it does not work In practice'.
Fortunately, lot of concepts and theories developed in the field of
organisational behaviour do have applicability and their understanding is
important for successful management practices. Organisational
behaviour emphasizes that human factor is not merely an instrument in
the organisation but the very core of the organisational existence. From

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this point of view, organisational behaviour provides opportunity for

analyzing human behaviour for understanding and prescribing means for
shaping human behaviour for desired results. In particular,
organisational behaviour contributes to understand human behaviour, to
control and direct it, and to adapt the organisation to given situations.
7. Value of Experience: Theories are important for increasing managerial
effectiveness provided these are utilised properly. Proper utilization of a
theory requires that the practitioner has both knowledge of the theory as
well as that of the situation in which the theory is to be applied.
Knowledge of situations comes from experience. As mentioned earlier,
organisational behaviour is both science and art; therefore, combination
of both makes the organisational process effective. Its science aspect
suggests that theoretical knowledge is necessary: its art aspect
suggests that perfection can be achieved through practice. Therefore,
the use of theory and practice is not an 'either or' situation; it is a blend
of both, experience contributes to better way of doing the things
because the practitioner mayweed out the undesirable practices over
the period of time and may retain the desirable practices. Therefore, the
knowledge of the theories makes the experience meaningful. When the
experience is unscientific, we must be cautious of its meaning and
value. It is very old saying that ten year's experience may only be one
year's experience ten times. Experience is a valuable asset if used
wisely. Experience allows the comprehension of the theoretical concepts
much more easily. Experienced managers are certainly more adept in
the application of knowledge but the magnitude of adeptness will
depend upon their ability to learn from their experiences. In doing so, a
practitioner is just like an academician. Each performs experiments and
draws conclusions from their experience. The major difference lies In the
methods and techniques to evaluate the experience. The academician
prefers to call the experience as experiment or research and tries to
make generalisations based on several such experiments. Thus, in the
final analysis, theory and experience are complementary to each other.
Just as all experience with no theoretical background is undesirable, the
'egghead' approach to organisational behaviour, that is, only theory and
no practical experience is equally inappropriate.

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FOUNDATION OF ORGANIZATION BEHAVIOR

Whilst the first four concepts centre on people, the next two are concerned
with organizations. The last one is a combination of the first five
assumptions. A brief explanation of each assumption follows.
1. Individual differences: people have much in common (they become
excited by the arrival of a new child in the family or they are grieved by the
loss of a loved one), but each person in the world is also individually
different. Each one is different from the others in several ways. Whether
it is intelligence, physique, personality, diction, or any such trait, one can
find striking differences. The idea of difference comes originally from
psychology. From the day of birth, each person is unique and individual
experiences after birth make people even more different. Individual
differences mean that management can cause the greatest motivation
among employees by treating them differently. If it were not for individual
differences, some standard, across-the-board way of dealing with all the
employees could be adopted and minimum judgment would be required
thereafter. It is because of individual differences that OB begins with the
individual. Only a person can take responsibility and make decisions, a
group, by nature, cannot do so. A group is powerless until individuals
therein act
2. A whole person: When an individual is appointed, his/her skill alone is
not hired; his/her social background, likes and dislikes, pride and prejudices
are also hired. A person's family life cannot be separated from his or her
work life. It is for this reason that managers should endeavor to make the
workplace a home away from home. They not only strive hard to develop a
better employee out of a worker, but also a better person in terms of growth
and fulfillment.
3. Caused behavior: the behaviour of the employee is caused and not
random. This behavior is directed towards someone that the employee
believes, rightly or wrongly, is in his/her interest. Thus, when a worker
comes late to his or her work, pelts stones at a running bus, or abuses the
supervisor, there is a cause behind it. The manager must realize this basic
principle and correct this behaviour and tackle the issue at its root.
4. Human dignity: This concept is of a different order from the other three
just discussed because it is more an ethical philosophy than a scientific
conclusion. It confirms that people are to be treated differently from other
factors of production because they are of a higher order in the universe. It
recognizes that people want to be treated with respect and dignity and
should be
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treated. Every job, however simple, entitles the people who do it to proper
respect and recognition of their unique aspirations and abilities. The
concept of human dignity rejects the old idea of using employees as
economic tools. Ethical philosophy is reflected in the conscience of
humankind, confirmed by the experience of people in all ages. It has to do
with the consequences of our acts to ourselves and to others. It recognizes
that life has an overall purpose and accepts the inner integrity of each
individual. Since organizational behaviour always involves people, ethical
philosophy is involved in one way or the other in each action. Human
decisions cannot and should not be made devoid of values.
5. Organizations are social systems: From sociology we learn that
organizations are social systems; consequently activities therein are
governed by social as well as psychological laws. Just as people have
psychological needs, they also have social roles' and status. Their
behaviour is influenced by their group as well as by their individual drives.
In fact, two types of social systems exist side by side in organizations. One
is the formal system and the other is the informal social system.
The existence of a social system implies that the organizational
environment is one of dynamic change, rather than a static set of relations
as revealed in an organization chart. All parts of the system are
interdependent and are subject to influence by any other part.
6. Mutuality of interest: Mutual interest is represented by the statement
that 'organizations need people and people also need organizations.
Organizations have human purpose. They are formed and maintained on
the basis of some mutuality of interest among their participants. If mutuality
is lacking, it makes no sense to try to assemble a group and develop
cooperation, because there is no common base on which to build. Mutual
interest provides a super ordinate goal that unites the variety of needs that
people bring to organizations. The result is that people are encouraged to
attack organizational problems rather than each other.
7. Holistic concept: When the above six fundamental concepts of OB are
placed together, a holistic concept emerges. This concept interprets
people-organization relationships in terms of the whole person, whole
group, whole organization, and the whole social system. It takes an allencompassing view of people in organizations in an effort to understand as
many of the possible factors that influence their behaviour. Issues are
analyzed in terms of the situation affecting them rather than in terms of an
isolated event or problem.

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NATURE OF ORGANISATIONAL BEHAVIOUR

Organizational behavior is emerging as a separate field of study. Therefore,
its nature is likely to change over the period of time. However, its present
nature can be identified as follows:
1. A Field of Study and not a Discipline. Organizational behavior can be
treated as a distinct field of study and not a discipline or even emerging
discipline. A discipline is an accepted science with a theoretical foundation
that serves as the basis for research and analysis. Organizational behavior,
because of its broad base, recent emergence, and interdisciplinary
orientation, is not accepted as science. We have just begun to synthesize
principles, concepts, and processes in this field of enquiry. Therefore, it is
reasonable to call it a field of study rather than a discipline.
2. Interdisciplinary Approach. OB is basically an interdisciplinary
approach. An interdisciplinary approach integrates the relevant knowledge
drawn from different disciplines for some specific purpose. As discussed
later, OB draws heavily from psychology, sociology and anthropology.
Besides, it also takes relevant things from economics, political science, law,
and history. These disciplines exist separately, but OB integrates the
relevant contents of these disciplines to make them applicable for
organizational analysis. Thus, OB is nothing apart from the integration of
knowledge from different disciplines.
3. An Applied Science. The basic objective of OB is to make application of
various researches to solve the organizational problems particularly related
to human behavior aspect. Unlike the pure science which concentrates on
fundamental researches, OB concentrates on applied researches. Though
many of the researches may be carried on in laboratory situations and
controlled conditions, they are meant for general application in
organizational analysis. Thus, organizational behavior is both science as
well as art.
4. Normative and Value Centered. OB is a normative science. A
normative science, unlike the positive science which suggests only causeeffect relationships, prescribes how the various findings of the researches
can be applied to get organizational results which are acceptable to
the society. Thus, what is acceptable by the society or Individuals engaged
in an organization is a matter of value to the people concerned. This aspect
cannot be explained by positive science. The normative nature of OB is
underscored by the proliferation of theories about management styles,
ranging from 'how-to' prescriptions to polemics about change in basic
practices.
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5. Humanistic and Optimistic. OB focuses the attention on people from

humanistic point of view. It is based on the belief that needs and motivation
of people are of high concern. There is an acceptance of the value of the
individual as a thinking, feeling organism, and without these considerations,
the organization may not be fully operational as a social entity. Further,
there is optimism about the innate potential of man to be independent,
creative, productive, and capable of contributing positively to the objectives
of the organization. The man will actualize this potential if proper conditions
and environments are given to him.
6. Oriented towards Organizational Objective. OB, being an applied
science and emphasizing human aspect of the organization, is oriented
towards organizational objectives. Though an organization may have
several objectives and sometimes conflicting with individual
objectives, it should not be understood that OB only emphasizes the
achievement of individual objectives at the cost of organizational
objectives. In fact, OB tries to integrate both types of objectives so that
these are achieved simultaneously. For this purpose, it suggests various
behavioral approaches.
7. A Total Systems Approach. OB is a total systems approach wherein
the living system of an organization is viewed as an enlargement of a man.
The systems approach is an integrative approach which takes into account
all the variables affecting organizational functioning. In fact, the systems
thinking in organizational analysis has been developed by behavioral
scientists. Behavioral science, while analyzing organizational behavior,
does not take human being In isolation but as the product of sociopsychological factors. Thus, his behavior can be analyzed keeping in view
his psychological framework, interpersonal orientation, group
Influence, and social and cultural factors. Thus, man's nature is quite
complex, and OB by applying systems approach tries to find solution of this
complexity.

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FEATURES OF ORGANIZATION BEHAVIOR

Organizational Behavior is the study and use of information relating to the
behavior of the people at work. Organizational behavior concentrates on
the following:
1. Individual
Individual employees are the focal points of an organisation. They work in
the organisation to satisfy their needs, egos and experience. Each
employee has its own physical, psychological and social needs for which
he uses his own traits and experiences. There may be a number of psychosocial and economic factors human behavior at work. The study, research
and use of these factors help management to mould and modify the
behavior of employees for achieving organisational objectives through
increasing their efficiency and effectiveness.
2. Group
Individual behaviour and group behavior are distinctively observed in an
organisation. Group performance is more effective than individual
performance. This synergy is observed in-group behaviour. The group is a
separate entity that needs to be studied and researched. It is an accepted
fact that a group sets goals, behaves, thinks and acts. Groups have
synergy and synthesis as compared to the energy and mentality of an
individual. If group power is channelized towards goal achievement, it can
put in an outstanding performance.
3. Structure
The structural relations are instrumental in the behaviour of employees at
work. The structured relationship is the basis of formalised policies,
procedures, organisational culture, hierarchical authority and
responsibilities. The structure of the organisation is not always formal.
Many time's informal organisations have more fruitful effects on the
effectiveness and efficiency of the organisation. The organisational
objectives are reduced to different goals of structural points for their prompt
achievement. Structural behaviour of individuals and groups have their own
identity and entity.
4. Technology
Technology results in better work, because it incorporates technical skills,
which encompass the ability to apply specialized knowledge. When people
develop their technical skills, they get satisfaction at work. Interpersonal
roles, informational roles and managerial functions are improved with the
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use of technology. Consequently, human skill as well as conceptual skills

are developed.
5. Environment
The environment has its own behaviour, which influences the people's
behaviour at work. Government policies, social systems, religious beliefs,
family and economic conditions national philosophies, employees'
psychology and other factors inside and outside the organisation have a
mutual influence on each other's behaviour. Environment factors influence
work behaviour, us of authority and responsibility, relationships, the
perceptual framework of employees and other related factors of behaviour.

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CHALLENGES IN ORGANISATIONAL BEHAVIOUR

Before we proceed to discuss how OB knowledge can be applied in
practices, let us go through the behavioral challenges that are likely to be
faced by managers. The contemporary Indian business Is characterized by
two major featuresliberalization of economy and globalization
of economy. Liberalization of economy has paved the way for free
economy In which one can
do what one wants. This has resulted into fierce business competition and
business organizations have been forced to change their working styles to
face this competition. This change is creating lot of behavioral problems
which managers have to solve. Another aspect of the contemporary
business Is globalization. This has not only affected Indian business
organizations but organizations throughout the world have been affected. In
the Indian context, many multinationals have come to India and many
Indian organizations have gone abroad. This process is still in progress.
Globalization has raised two types of behavioral problems. First, when a
manager of Indian origin goes abroad, he has to manage a workforce
which is quite different from the workforce that he was managing. Such
differences may not be only In terms of languages and living habits but
there may be differences In terms of aspirations, needs, attitudes, way of
working, etc. It Implies that earlier strategy of tackling behavioral
Issues may not be effective; this has to be changed according to the new
situation. Second, when a manager joins a multinational company
operating in India, he finds himself In totally different work culture. In this
situation, the manager has to change himself to fit with the new
situation. In the light of this economic liberalization and globalization, we
can identify the behavioral challenges that managers have to face in
managing organizations. These challenges
are as follows:
1. Cross-cultural dynamics,
2. Workforce diversity,
3. Increasing workforce aspirations,
'
4. Increasing quality consciousness,
6. Newer organizational designs, and
6. Mergers and acquisitions.

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1. Cross-cultural Dynamics
Cross-cultural dynamics Implies that people of different cultures have
different behavioral patterns. On the basis of various researches, It has
been concluded that management practices are culture bound and no
single management practice is suitable to all cultures. Culture is a
set of beliefs, attitudes, and values that are shared commonly by the
members of the society. Since different countries may have different
cultures, people of different countries may have different behavioral
patterns, Hofstede, a Dutch management scholar, studied behavioral
patterns of workers and managers in forty countries and found that
behaviors differed
significantly due to the values and beliefs In various countries' 2 According
to Hofstede, there are two dimensions that explain the differences in
behaviors due to culture: individualism collectivism continuum and power
distance. Individualism collectivism continuum suggests that
people's behaviors depend on whether they have belief in individualism or
collectivism. Individualism exists to the extent that people in a culture
define themselves by referring to themselves as singular persons rather
than as part of one or more groups or organizations At work, people from
individualistic cultures tend to be more concerned about themselves
rather than their work group and individual tasks are more important than
relationships, Collectivism is characterized by tight social frameworks in
which people tend to base their identity on the group or organization to
which they belong. M work, it implies that employer-employee links are
more like family relationships. Thus, relationships are more important
than individuals or tasks. Power distance is the extent to which less
powerful people accept the unequal distribution of power. People coming
from high power distance cultures prefer to be in a situation where authority
is clearly understood and lines of authority are never bypassed.
They observe the organizational rules strictly. On the other hand, people
coming from less power distance countries have low respect for authority
and are quite comfortable circumventing lines of authority to accomplish
jobs. They prefer flexible organisational rules. In the age of rapid
globalization, a single organization may have people from diverse cultures.
This phenomenon will pose serious challenge before managers to design
management practices that are suitable for people coming from different
cultures.

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2. Workforce Diversity
While cross-cultural dynamics focuses on differences between people from
different countries, workforce diversity takes into account differences
between people within a given country. Workforce diversity is the extent of
differences and similarities in such characteristics as age, gender, ethnic
groups, physical abilities/disabilities, race, and sexual orientation among
the employees of organisations. Now-a-days, more and more organisations
are becoming heterogeneous in terms of employee composition based on
age, gender, ethnic groups, physical abilities/disabilities, etc. For example,
more and more women are joining business organisations as managers
and other specialists. Similarly, special recruitment programmes are being
conducted by some types of organisations to recruit members belonging to
scheduled
castes/tribes, physically handicapped, ex-servicemen, retired employees,
and so on. The number of knowledge workers is increasing day-by-day.
Because of this workforce diversity, behavioural pattern of employees
shows great variation. Workforce diversity has important implications for
management practices. Managers have to shift their philosophy from
treating everyone alike to recognizing differences and responding
those differences in ways that ensure employees' greater productivity
while, at the same time, not discriminating. This shift may include giving
special attention to certain category of employees in training and
development, career planning, etc. It may be noted that while
managing workforce diversity effectively may be a challenge but, if
managed properly, it results into increased creativity in the organisation
because of diversity of ideas due to workforce
diversity.
3. Increasing Workforce Aspirations
With the passage of time, there is a tendency of increasing workforce
aspirations. International demonstration effect and easy access to media,
both print and electronics, have led to this increased aspirations. Today,
employees not only want decent monetary package but highly conducive
workplace. The buzz words in today's workplace are openness, teamwork,
quality of work life, empowerment, flexible work schedules, telecommuting,
and so on. These features of workplace arc quite different from what used
to be in the past. For meeting these aspirations of workforce, managers
have to create a new type of work environment to stimulate employees
to put their best as well as to attract talents for future requirements.
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4. Increasing Quality Consciousness

Because of increased competition, both from indigenous as well as from
foreign organisations, there is increased emphasis on quality of products
and services, that too at competitive cost. Today, the buzz words in quality
are total quality management, kaizen (improvement upon improvement), six
sigma standard, and quality certification. Because of increased emphasis
on quality, organisations have to change not only their technology but way
of their working. Such a change results into behavioural problems in
employees as they perceive that such a change would affect them
adversely. Therefore, the managers have to adopt suitable practices
to ensure that employees accept change willingly and become part of the
mission of spreading quality consciousness throughout the organisation.
5. Newer Organisational Designs
Organisational designs, today, are not based on the classical approach of
division of labour, rigid departmentation, authority-responsibility parity,
and numerous hierarchical levels. These have moved from bureaucratic to
adaptive structure, from mechanistic to organic structure, and from tell to
flat structure. Information technology has led to the development, of
networked organisations in the form of temporary alliances of suppliers,
customers, and even erstwhile competitors. Working pattern of newer
organisational designs is quite different from classical organisational
designs. Therefore, employees have to unlearn their old way of working
and learn new way of working. This transition from old way to new way Is
quite painful. It Is the responsibility of managers to create a kind of work
environment which enthuses the employees to adapt new way of working.
6. Mergers and Acquisitions
Because of economic liberalization, the way of doing business has been
changed. Earlier, most of the business houses used to have a diversified
business portfolio in which many unrelated businesses used to exist. This
was true to individual organisations too. Now-a-days, businesses
are being organised around core competency, the unique ability of an
organisation to do a particular business or related businesses. Because of
this reason, many organisations have divested their unrelated businesses
which have been acquired by other organisations. This process has paved
the way for mergers and acquisitions. While mergers and acquisitions have
business sense, they create challenge of integrating acquired and acquiring
companies, and more particularly the integration of people of acquired
company. This problem gets aggravated if people-related management
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practices of two companies are quite different. In general, people of

acquired company have behavioural problems in the form of initial anxiety
and stress, fear of loss of jobs, transfer to new locations, job changes
including new roles and assignments, change in remuneration and benefits,
change in career paths, change in power and status, and problems of
adjustment with new organisational and work practices. Unless these
behavioural problems are solved, mergers may not be effective. Thus, the
challenge before the managers Is how to overcome these behavioural
problems and integrate people of acquired company with the acquiring
company to make the merger effective.

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ROLE OF ORGANIZATION BEHAVIOUR

As discussed above, the suitable knowledge of theoretical constructs in any
discipline helps greatly in solving the problems involving that area. This is
also true with organisational behaviour. OB offers several ideas to
management as to how human factor should be properly emphasized to
achieve organisational objectives. Human factor is not merely an
instrument in the organisation but the very core of organisational existence.
Theorists have observed that an organisation is a conscious interaction of
two or more persons. This suggests that since organisation Is the
interaction of persons, they should be given adequate importance in
managing the organisation. This becomes more important specially
because of the changing dimensions of human behaviour, changing from
money motivated behaviour to multimotivated behaviour. McGregor
suggests that people are moving from Theory X assumptions to Theory Y
assumptions. The changing behavioural pattern suggests that
organisational structure and process should be based on these
characteristics. From this point of view, managers
must understand the behavioural pattern of the people and shape this
pattern to achieve organisational objectives. Organisational behaviour
helps the managers in the following areas:
3. Understanding human behaviour,
2. Controlling and directing human behaviour, and
3. Organisational adaptation.
Understanding human behaviour
OB provides a way for understanding human behaviour in the organisation.
For shaping human behaviour In definite direction for achieving certain
predetermined objectives, managers must know how the people in the
organisation behave. OB provides way for understanding human
behaviour In all the directions In which human beings interact. Thus,
behaviour can be understood at the individual level, interpersonal level,
group level, and intergroup level.
1.Individual Level. The behaviour of human beings as a social man is the
first Issue in behavioural science. It provides for analyzing why and how an
Individual behaves In a particular way. As will be seen later, human
behaviour Is a complex phenomenon and is affected by a large number of
factorspsychological, social, cultural, and others. OB integrates these
factors to provide simplicity In understanding human behaviour.

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2. Interpersonal Level. Human behaviour can be understood at the level

of Interpersonal interaction. Such interpersonal interaction is normally in
paired relationship which represents man's most natural attempt at
socialization. When one focuses on the Influence of one's peer and Its
effect In working relationship, or examines the superior-subordinate
relationship, it is obvious that the two-person relationship Is inevitable in the
organisation. OB provides means for understanding this interpersonal
relationship in the organisation. Analysis of reciprocal relationship, role
analysis, and transactional analysis are some of the common methods
which provide such understanding.
3. Group Level. Though people interpret anything at their individual level,
they are often modified by group pressure which, thus, becomes a force in
shaping human behaviour. Thus, individuals should be studied in group
also. Research in group dynamics has contributed vitally to OB and shows
how a group behaves In terms of its norms, cohesion, goals, procedures,
communication pattern, leadership, and membership. These research
results are furthering managerial knowledge of understanding group
behaviour which is very important for organisational morale and
productivity.
4. Intergroup Level. The organisation is made up of many groups that
develop a complex of relationships to build its process and substance.
Understanding of the effect of group relationship is important for managers
in today's organisation. Intel-group relationships may be in the form of
cooperation or competition. The cooperative relationships help the
organisation in achieving its objectives. OB provides means to understand
and achieve cooperative group relationships through interaction, rotation of
members among groups, avoidance of win-lose situation, and focus on
total group objectives.
Controlling and Directing Human Behaviour
After understanding the mechanism of human behaviour, managers are
required to control and direct the behaviour so that it conforms to standards
required for achieving organisational objectives. Thus, managers are
required to control and direct the behaviour at all levels of individual
interaction. For this purpose, OB helps managers in many areas: use of
power and sanction, leadership, communication, and building organisation
climate conducive for better interaction.

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1. Use of Power and Sanction. Organisational behaviour can be

controlled and directed by the use of power and sanction which are formally
prescribed by the organisation. Power is referred to as capacity of an
individual to take certain action and may be utilised in many ways. The use
of power is related with sanction in the organisation. However, mere use of
power and sanction in the organisation is not enough for directing human
behaviour. Moreover, these can be used in several ways and not all ways
are equally effective. OB explains how various means of power and
sanction can be utilised so that both organisational and individual
objectives are achieved simultaneously.
2. Leadership. Another method of bringing human behaviour in tune with
organisational requirement is leadership. Today, the difference between a
successful and failing organisation lies in the equality of leadership of its
managerial personnel. OB brings new insights and understanding to the
theory and practice of leadership. It identifies various leadership styles
available to a manager and analyses which style is more appropriate in a
given situation. Thus, managers can adopt styles keeping in view the
various dimensions of organisations, individuals, and situations.
3. Communication. Communication is the building block of an
organisation. This communication through which people come in contact
with others. People in the organisation, particularly, at higher level spend
considerable time in communicating. To achieve organisational
effectiveness, the communication must be effective. The communication
process and how it works in interpersonal dynamics has been evaluated by
organisational behaviour. The factors that affect communication have been
analyzed so as to make it more effective.
4. Organisational climate refers to the total organisational situations
affecting human behaviour. Organisational climate takes a systems
perspective and affects human behaviour. Organisational behaviour
suggests the approach to create organisational climate in totally rather than
merely improving the physiological conditions or increasing employee
satisfaction by changing isolated work process. Satisfactory working
conditions, adequate compensation, and the necessary equipments for the
job are viewed as only small part of the requirements for sound
motivational climate. Of greater importance are the creation of an
atmosphere of effective supervision, the opportunity for the realization of
personal goals, congenial relations with others at the workplace, and a
sense of accomplishment. Thus, OB has discovered a new approach of
managing people in the organisation.
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Organisational Adaptation
Organizations as dynamic entities are characterized by pervasive change.
In this age of environmental variability, the real job of a manager is to
provide continuity in organisations because the organisations have to adapt
themselves to the environmental changes by making suitable internal
arrangements. However, such organisational arrangements are mostly
resisted by the internal people. Thus, managers have to face dual
problems: identifying need for change and then implementing the change
without adversely affecting the need for satisfaction of organisational
people. It is also the essence of managing change. Management of change
is seen as a self-perpetrating ever-evolving phenomenon.

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ADVANTAGES OF ORGANIZATIONAL BEHAVIOR

The study of OB has proved beneficial in many ways. The benefits of
studying OB are as follows:
1. OB is a systematic study of the actions and attitudes that people exhibit
within the organisation. It also helps any individual to understand his
behaviour.
2. OB has proved instrumental for managers in getting their work done
effectively.
3. OB lays emphasis on the interaction and relations between organisation
and individual behaviour. It works as a positive attempt in fulfilling
psychological agreement between organisation and the individuals.
4. OB delivers job satisfaction to employees and helps in developing workrelated behaviour in the organisation.
5. OB helps in building motivating climate in the organisation.
6. OB helps in building cordial industrial relations.
7. OB smoothes the progress of marketing by providing deeper insight of
consumer behaviour and motivating and managing field employees.
8. OB helps in predicting behaviour and its application in meaningful way
delivers effectiveness in the organisation.
9. OB implies effective management of human resources.
10. OB helps in improving functional behaviour within the organisation. It
helps in attaining higher productivity, effectiveness, efficiency,
organisational citizenship. It works effectively in reducing dysfunctional
behaviour at work place like absenteeism, employee turnover,
dissatisfaction, tardiness etc.

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11. OB helps in developing the following skills:

a) Self development
b) Personality development
c) Development of human values and ethical perspective
d) Managing stress and achieving mental hygiene
e) Creative use of emotions
f) Creating learning individual and learning organisation
g) Managing creativity and innovation
h) Motivation and morale
i) Job satisfaction
j) Effective communication
k) Interpersonal effectiveness including persuasion, coaching,
counseling,
l) Team building
m) Leadership
n) Creating effective organisational culture
o) Managing change
p) Continuous development through behavioural interventions.

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DISADVANTAGES OF ORGANIZATION BEHAVIOR

The shortcomings of the subject OB that should not be lost sight of are. To
start with, though the subject helps an individual understand human
behaviour better only in the workplace, he or she may be a failure on the
domestic front. People who have a thorough grounding of behavioural
disciplines have sometimes proved to be total wrecks in their personal
lives. The subject of OB has not contributed to improved interpersonal
relations in organizational settings. Jealousies, back-stabbing, leg-pulling,
intrigues, harassment, and inequalities in rewards go side by side with nice
lectures, training programmes, discussions, smiles, assurances, niceties
and the like (Recollect the opening case). An employee is not sure when a
pink slip will be handed out or when a reward will be announced. History
seems to be repeating itself. In the earlier days, a worker was exposed to
12 to 14 hours of work and was made to work under inhuman conditions.
An employee today, particularly in the new economy firms, does work 12
to14 hours a day but under for better working conditions. The worker of the
bygone days was stress-free. Today's employee is always under pressure
and stress-ridden. While a worker of the earlier years died of lung diseases
caused by fumes and dust; today's employee gets burnt out by the time he
or she reaches 45 years of age. The subject of OB has almost become a
fad with managers in most organizations. Common uniforms, open offices,
and shared canteens have, for example, been practiced in several
industrial establishments in the name of improving interpersonal relations.
But wearing identical clothes has not changed the attitude of the boss
towards his/her subordinates. Seldom is the subordinate treated as an
equal, and rarely are his/her views respected and accepted. Removal of
physical palisades in the office has not abolished the mental barriers
between the manager and the managed. The boss and the subordinates
may eat the same food in the same canteen. Still, the former expects
his/her subordinate to serve him/her the food and treat him/her differently.
The dual personalities of managers are often bewildering. Outwardly, they
talk about participative management, equality of opportunities,
empowerment, and open door policies. Behind the veneer of all this pep
talk, is the harsh reality that most of these bosses are feudal lords who
expect the subordinates to be slaves. Any deviation from this makes the
boss feel insecure. The smart subordinate is feared, bounded, and is finally
made to quit. OB is selfish and exploitative. It serves only the interest of the
management. It is the product of capitalist societies. With high emphasis on
motivation, efficiency, and productivity, the subject breeds a competitive
spirit among the employees. They are not allowed to function and live in
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harmony with one another. A serious problem that has plagued the subject
is the tendency of managers to expect quick-fix solutions from behavioural
programmes. This expectation makes the managers address the symptoms
while neglecting the underlying problems or to fragment their efforts within
the firms. Critics of OB wonder whether the ideas that have been
developed and tested during periods of organizational growth and
economic plenty will endure with equal success under different conditions.
Future environment shall be marked buy shrinking demand, scarce
resources, and more intense competition. When organizations stagnate,
decline, or encounter a threat of closure, there will be conflict and stress.
Under these conditions, will the conflict resolution strategies work? Will the
motivational models be relevant? Will the leadership styles e practicable?
No easy answers are available to these and other related questions.
Finally, OB will not totally abolish conflict and frustration, it can only reduce
them. It is a means to improve, not an absolute answer to problems. It is
only a part of the whole fabric of an organization. We can discuss OB as a
separate subject; but to apply it, we must relate it to reality. However
improved, OB will not solve unemployment. It will not make up for our own
deficiencies. It cannot substitute for poor planning, inept organizing, or
inadequate controls. It is only one of the many systems operating within a
larger social system. The shortcomings of OB, however, should not detract
the reader from the greatest contribution of the discipline to human lifeunderstanding human behaviour. Life in and outside organizations would
not be what it is if we fail to understand ourselves and our fellow beings
better.

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IMPORTANCE OF ORGANIZATION BEHAVIOR

A study of OB is beneficial in several ways. In the first place, OB provides a
road map to our lives in organizations. Every one of us has an inherent
need to know about the world in which we live. This is particularly true in
organizations, as they have a profound effect on our actions and
behaviors.
1. People bring to their work place their hopes and dreams as well as their
fears and frustrations. Much of the time, people in organizations may
appear to be acting quite rationally, doing their fair share of work, and
going about their tasks in a civil manner. Suddenly, a few people appear
distracted, their work slips, and they even get withdrawn. Worse still,
one may find someone taking advantage of others to further his or her
personal interests (Recollect the opening case).Occasionally, you are
likely to get caught up in anxiety-provoking organizational changes that
involve redeployments or even layoffs. Such a range of human
behaviors makes life in organizations perplexing. But those who know
what to look for and have some advance ideas about how to cope with
pressures are more likely to respond in ways that are functional, less
stressful, and even career-advancing. We, therefore, need to map out
organizational events so that we can function in a more secure and
comfortable environment.
2. The field of OB uses scientific research to help us understand and
predict organizational life. This is not to say that this knowledge is
absolute. The decisions and actions that people in organizations make
are determined by a complex combination of factors. Besides, the field
of OB is not a pure science. Nevertheless, it helps us make sense of the
workplace and, to some extent, predict what people will do under
various conditions.
3. OB helps us influence organizational events. Though it is good to
understand and predict organizational events, most of us want to
influence the environment in which we live. Whether one is a marketing
specialist or a computer programmer, he or she needs to know how to
communicate effectively with others, manage conflict, make better
decisions, ensure commitment to ideas, help work teams operate more
effectively, and the like. OB theories and concepts will. help us influence
organisational events.
4. OB helps an individual understand himself/herself and others better.
This helps improve interpersonal relations considerably. Of particular
significance are topics like attitude, perception, leadership,
communication, T.A. and conflict, an understanding of which will change
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5.

6.

7.

8.

the very style of talking and functioning of an individual. It is no

exaggeration that the MBA graduate always remembers, with
satisfaction, OB among all the subjects of his/her course, even after
graduation.
A manager in a business establishment is concerned with getting things
done through delegation. He or she will be successful when he or she
can motivate subordinates to work for better results. OB will help the
manager understand the basis of motivation and what he or she should
do to motivate subordinates.
The field of OB is useful for maintaining cordial industrial relations. If an
employee is slow in his or her work, or if his or her productivity is
steadily declining, it is not always because of denial of promotion or a
poor work environment. Similarly, if the union of workers gives a strike
call, the basic issue may not be a demand for more wages, higher
bonus, a better canteen, or for three pairs of uniform in the place of two.
Often the indifferent attitude of the boss makes the worker lazy.
Similarly, reluctance of the management to talk to union leaders about
issues might provoke them to give a strike call. In other words, relations
between management and employees are often strained for reasons
which are personnel issues, not technical. Human problems need to be
tackled humanely. OB is very useful in this context as it helps
understand the cause of the problem, predict its course of action, and
control its consequences. It is also a human tool for human benefit. The
field of OB serves as the basis for human resource management.
The subject of OB is also useful in the field of marketing. In the dynamic
mechanism of the flow of goods and services from producer to
consumer, awareness of the nature of individual and social processes
has an immediate or long-range contribution to the success or failure of
the enterprise. Consumer choice behaviour, the nature of influence, and
the channels involved, represent leading topics for behaviour research in
this area. Innovation and the diffusion of new products, creativity, and
the learning of responses are equally important social and individual
phenomena that contribute to the total process.
The most popular reason for studying OB is that the reader is interested
in pursuing a career in management and wants to learn how to predict
behaviour and apply it in some meaningful way to make organizations
more effective. A successful manager should have good 'people skills'
which include the ability to understand one's employees and use this
knowledge effectively to make them more efficient.

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9. In the last couple of years, our economy has been witnessing a upward
trend; every sector of the economy doing pretty well, registering an
overall growth rate of seven per cent per annum. In order to sustain this
trend, effective management of all sectors of the economy, particularly
the industrial sector, is of paramount importance. Effective management
does not mean competent utilization of technical or financial resources
alone. Rather, it implies efficient management of human resources. This
is where OB comes into the picture. It is a discipline which enables a
manager to motivate his or her subordinates towards higher productivity
and better results.

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CONTEMPORARY ORGANIZATION BEHAVIOR

OB is not a discipline in itself but- it uses knowledge developed in the
relevant disciplines. OB basically draws concepts and principles from
behavioural sciences and the core disciplines of behavioural sciences are
psychology, sociology, and anthropology. Since these disciplines
themselves are part of social sciences, it can be said that OB draws
something from social sciences like economics, history, and political
science. OB draws knowledge from all these disciplines but it does not
draw the whole knowledge of these disciplines but only the relevant
knowledge which helps in predicting and directing human behaviour in the
organisation. The contributions are from the following
Psychology
The term 'psychology' comes from the Greek word 'psyche' meaning soul
or spirit. Modern psychology is almost universally defined as the science of
behaviour which is nearly identical with behavioural science, in general.
Though there arc two other disciplines which make behavioural science,
psychology is more closely identified with overall behavioural science.
Psychology is a science of behaviour, the term behaviour being interpreted
literally, for it comprehends not. only objective and subjective form of
human behaviour but also the behavior of the animals. Psychology studies
behaviour in various conditionsnormal, abnormal, social, industrial, legal,
childhood, adolescence, old age, etc. It also studies processes of human
behaviour, such as learning, thinking, memory, sensation, perception,
emotion, feeling, and personality. Its contributions to behavioural science,
as applied to managerial practices, arc In the field of learning, perception,
motivation, individual and group decision making, pattern of influence, and
change in organisations, group process, vocational choice and satisfaction,
communication, and personnel selection and training. In fact, there is a
separate brands of Industrial psychology which deals with the application of
psychological facts and principles to the problems concerning human
relations in organisations. Human relations is the integration of human
factor into work situation which motivates it to work together effectively
providing it social, psychological, and economic satisfaction. From this
point of view, the contribution of
psychology is quite significant.

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Sociology
Sociology can be described as an academic discipline that utilizes the
scientific method in accumulating knowledge about man's social behaviour.
It studies the patterned, shared human behaviour; the way in which people
act toward one another. It specifically studies social groups, social
behaviour, society, customs, institutions, social class, status, social
mobility, and prestige. It has also developed sub-fields of political
sociology, Industrial sociology, sociology of law, family sociology,
educational sociology, and sociology of religion. To the managerial
practice, Its contribution is mainly in the field of bureaucracy, role
structures, social system theory, group dynamic, effect of Industrialization
on the social behaviour, etc.
Anthropology
The term 'anthropology' combines the Greek stem 'onthropo' meaning man
and the noun ending logy' meaning science. Thus, anthropology can be
defined as the science of man. It particularly studies civilization, forms of
cultures and their impact on Individuals and groups, biological features of
man and evolutionary pattern, speech and relationship among languages.
Anthropology contributes in understanding the cultural effects on
organisational behaviour, effects of value systems, norms, sentiments,
cohesion, and Interaction. Besides these three basic behavioural
disciplines, economics contributes in understanding the decision process,
methods of allocating scarce resources in the organisations, and the
impact of economic policy on organisations. Political science provides clue
to conflicts in organisations, power and authority structure, and overall
administrative process. From historical approach, case studies have
emerged which have helped in clarifying the roles of
decision makers.
Social Psychology
This concept borrows ideas from both sociology and psychology. It focuses
on the influence of people on one another. One of the areas receiving
considerable attention from social psychology is change- how to reduce
resistance to it and implement it successfully. Additionally social
psychology is useful in measuring, understanding and changing attitudes,
communication patterns, the ways in which the group activities can satisfy
individual needs, and in group decision making process.

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Engineering
This discipline too has influenced ob. Industrial engineering in particular
has long been concerned with work measurement productivity
measurement and labor relations. Most recently medicine has also come
into play in connection with the study of OB especially in the area of stress.
Increasingly research is showing that controlling the causes and
consequences of stress within the organization is important for the well
being of both the individual and the organization
Political Science
Contributions from political scientists for a better understanding of OB are
very significant. Political scientists study the behaviors of individuals and
groups in a political environment.
In the pat the term political party was looked upon as dirty not anymore.
Organizations are becoming political entities and a better understanding of
them cannot be without understanding the political perspective.

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APPROACHES TO ORGANIZATION BEHAVIOR

Human Resource Approach
This approach recognizes the fact that people are the central resource in
any organization and the they should be developed towards higher levels of
competency, creativity, fulfillment. People thus developed will contribute to
the success of the organization. The human resource approach is also
called the supportive approach in the sense that the managers role
changes from control of employees to active support to their growth and
performance. The supportive approach contrasts with the traditional
approach where mangers decide what the employees should do and
closely monitor their performance to ensure the completion of the task. In
HR approach the role changes from structuring and controlling to
supporting
Contingency Approach
The contingency approach is another useful way of looking at OB
This approach assumes that there is no 'one best way' available in any
organisation. It suggests that in most organisations situations and
outcomes are contingent on, or influenced by, other variables the
contingency approach to OB differs from the universal approach The
universal model, shown at the top of the figure, presumes a direct cause
and effect link between variables. For instance, it suggests that whenever a
manager encounters a certain problem or situation (such as motivating
employees for higher efficiency and greater output), a universal approach
does exist (such as rising pay), that will lead to the desired outcome. The
contingency approach, on the other hand, acknowledges that several other
variables affect the relationship. Other words, the appropriate managerial
action or behaviour in any given situation depends the elements of that
situation.
Systems Approach
The systems approach to OB views the organisation as a united, purpose
system composed of interrelated parts. This approach gives managers a
way of looking at organisation in totality: as a whole person, whole group,
social system. In doing so, the system approach tells us that the activity of
any segment of an organisation affects, in varying degrees the activity of
every other segment. According to this approach, an organizational system
receives four kinds of inputs from environment: material, human, financial,
and informational. The organisation converts these inputs into products or
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services, employee behaviour, profits or losses, and additional information

and supplies these to the environment. The system then receives feedback
from the environment regarding the outputs. Thus the organisation
becomes an input-transformation-out) system. Managers should not
become passive spectators of organisational systems. A key function
managing is to adapt to transform system elements to achieve goals within
a dynamic environment. Managers need to work with people and allocate
resources to carry out tasks within an environment of change. The main
purpose of this book is to train managers to manage organisational system
more effectively. The systems approach has functional consequences for
managers. For one thing, it underscores the importance of an
organizations environment. Failing to acquire the appropriate resource and
to heed feedback from the environment, for instance, can be disastrous.
The systems approach also helps managers conceptualize the flow and
interaction of various elements of the organization as they enter the
system, is transformed by it, and then re-enter the environment.
Productivity Approach
Productivity, which is the ratio of output to input, is a measure of the
organizations effectiveness. It also reveals the manager's efficiency in
optimizing resource utilization. The higher the numerical value of this ratio,
the greater the efficiency. Productivity is generally measured in terms of
economic inputs and outputs, but human and social inputs and outputs also
are important. For example, if better OB can improve job satisfaction
a human output or benefit occurs. In the same manner, when employee
development programmes lead to a by-product of better citizens in a
community, a valuable social output occurs. OB decisions typically involve
human social, and/or economic issues, and so productivity, usually a
significant part of these decisions is recognized and discussed extensively
in the literature on OB.
Interactionalism
Interactionalism is a relatively new approach to understanding behaviour ii
organisational settings. First presented in terms of interactional psychology,
this view assumes that individual behaivour results from a continuous and
multidirectional interaction between characteristics of the person and of the
situation. More specifically, Interactionalism attempts to explain how people
select, interpret, and change various situations. It should be noted that the
individual and the situation are presumed to interact continuously. This
interaction is what determines an individual's behaviour.
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ORGANISATIONAL BEHAVIOUR MODELS

A model is an abstraction of reality, a simplified representation of some
real-world phenomenon. Models are developed in different fields to guide
activities in those fields. In the field of organisational behaviour, models arc
developed to provide framework about 'how people will be treated in an
organisation'. Every organisation develops a particular model in which
behaviour of the people takes place. This model Is developed on the basis
of management's assumptions about people and the vision of the
management. Since these assumptions vary to a great extent, these result
into the development of different organisational behaviour models (OB
models). From the very beginning of the civilised human society, two
alternative approaches have been adopted for placing trust on people. One
says "trust everyone unless there Is a contrary evidence"; another
says ''do not trust anyone unless there is a contrary evidence". Naturally,
interpersonal interactions take place differently under these two
approaches. Following description of the organisations is worthwhile to
note here:"Most of our organisations tend to be arranged on the
assumption that people cannot be trusted or relied on, even in tiny mattels."l4However, this is only one side of the coin. In the field of OB,
assumptions about people have been made on two extreme sides. For
example, McGregor has given theories X and Y, and each theory makes
assumptions which arc quite contrary to each other"; Thus, OB models
developed on the basis of these assumptions would show great variations.
However OB models that are in practice show some kinds of continuum
between these two opposite poles, though they tend to lean towards a
particular pole. Davis has described four OB models which arc as follows
1. Autocratic
2. Custodial
3. Supportive
4. Collegial
Autocratic Model
In the autocratic model, managerial orientation is towards power. Managers
see authority as the only means to get the things done and employees are
expected to follow orders. The result is high dependence on boss. This
dependence is possible because employees live on the subsistence level.
The organisational process is mostly formalised; the authority is delegated
by right of command over people to whom it applies. The management
decides what the best action for the employees is. The model is largely
based on the" Theory X assumptions of McGregor- where the human
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beings are taken inherently distasteful to work and try to avoid

responsibility. A very strict and close supervision is required to obtain
desirable performance from them. Likert's management system can be
compared with the model of organisational behaviour. His system]
(exploitative, authoritative) in which motivation depends on physical
security and some use of desire for status and better performance is
ensured through fear, threats, punishment, and occasional rewards;
communication is mostly one-way, that is, downward: there is little
interaction between managers and employees. The autocratic model
represents traditional thinking which is based on the economic concept of
the man. With the changing values and aspiration levels of people, this
model is yielding place to others. However, this does not mean that this
model is discarded in toto. In many cases, the autocratic model of
organisational behaviour may be a quite useful way to accomplish
performance, particularly where the employees can be motivated by
physiological needs. This generally happens at lower strata of the
organisation.
Custodial Model
In the custodial model, the managerial orientation is towards the use of
money to pay for employee benefits. The model depends on the economic
resources of the organisation and its ability to pay for the benefits. While
the employees hope to obtain security, at the same time, they become
highly dependent on the organisation. An organisational dependence
reduces persona] dependence on boss. The employees are able to satisfy
their security needs or in the context of Herzbergs theory, only
maintenance factors. These maintenance factors provide security but fail to
provide strong motivation. Although employees working under custodial
model feel happy, their level of performance is not very high. This
resembles again to Herzbergs satisfactory and dissatisfactory. Since
employees are getting adequate rewards and organisational security, they
fed happy. However, they are not given any authority to decide what
benefits or rewards they should get. This approach is quite similar to
patrimonial approach where the basic assumption is that it is the
prerogative of management to decide what benefits are best suited to the
employees. Such an approach is still quite common in many business
organizations in India. This phenomenon is more predominantly in familymanaged business organisations where family characteristics have also
been applied to the organisational settings, The basic ingredient of the
family-managed system is that parents decide what is good or bad for their
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children; managers decide what is good for their employees. From this
point of view, this model is not suitable for matured employees.
Supportive Model
The supportive model of organisational behaviour depends on managerial
leadership rather than on the use of power or money. The aim of managers
is to support employees in then-achievement of results. The focus Is
primarily on participation and involvement of employees in managerial]
decision-making process. The model is based on 'principles of supportive
relationships' of Likert, which is the basic ingredient of his. Likert states that
the leadership and other processes of the organisation must be such as to
ensure a maximum probability that in all interactions and all relationships
with the organisation, each member will, in the light of his background,
values, and expectations, views the experience as supportive and one
which builds and maintains his sense of persona] worth and It is quite
similar to the assumptions of McGregors Theory Y. The supportive model
is based on the assumptions that human beings move to the maturity level
and they expect the organisational climate which supports this expectation.
Various organisational processescommunication, leadership, decision
making, interaction, control, and influenceare such that these help
employees to fulfill their higher order needs such as esteem and selfactualisation. Likert has shown that supportive model is best suited in the
conditions where employees are self-motivated. Thus, this emphasizes not
on the economic resources of the organisation but its human aspect.
Manager's role is to help employees to achieve their work rather than
supervising them closely. This can be applied more fruitfully for higher level
managers whose lower order needs are satisfied reasonably.
Organisations with sophisticated technology and employing professional
people can also apply this model for getting best out of their human
resources. However, this does not mean that this model can be applied in
all circumstances. For example, Davis observes that the supportive model
tends to be especially effective in nations with affluence and complex
technology, because it appeals to higher order needs and provides Intrinsic
motivational factors. It may not be the best model to apply in less
developed nations, because their employees need structures arc often at
lower levels and their social conditions are differently Moreover, this model
can be applied more fruitfully for managerial levels as compared to
operative levels. As such, the tendency of modern management is to move
towards supportive model, especially for their management groups.
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Collegial Model
Collegian model is an extension of supportive model. The term 'collegial'
refers to a body of people having common purpose. Collegial] model is
based on the team concept in which each employee develops high degree
of understanding towards others and shares common goals. The employee
response to this situation is responsibility. Employees need little direction
and control from management. Control is basically through self-discipline
by the team members. The organisational climate is quite conducive to selffulfillment and self-actualisation. Collegial model tends to be more useful
with unprogrammed work requiring behavioural flexibility, an intellectual
environment, and considerable job freedom. The various modes of
organisational behaviour- are based on the assumption of the human
characteristics and how they can work best. Since situational variables are
strong factors in determining the organisational processes, managers
cannot assume that a particular model is best suitable for all purposes and
for all situations. Rather, all the models will remain in practice and that too
with considerable success. These models are basically constructed around
need hierarchy. Since need hierarchy is not similar for all the employees,
the same model cannot be used for all of them. The need hierarchy
changes with the level of a person in the organisation, level of his
education, level of maturity, personality factors, and the type of work
environment. Considering these factors, a particular model can be applied.
Organisation theorists have argued that there is a tendency to move
towards the adoption of supportive model as in this case, people may give
their best because in other models, they do not find conditions conducive to
give their best performance. Tills Is why managers are taking a number
of steps to humanize their organisations, such as participation, morale
building, and so on to make the organisations more effective.

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CASE STUDY: SUPER ENGINEERING COMPANY

Super Engineering Company was a multi locational light engineering
company. It had manufacturing facilities at Hyderabad, Pondicherry, and
Indore. The company adopted budgetary system with main emphasis on
production and expense budgets. The budget targets used to be set on the
basis of analysis of production facilities and production operations. While
the two units located at Hyderabad and Pondicherry were working properly
and were able to meet their budget Indore unit was not able to do so. Mr. P
Manohar was transferred to Indore unit as plant manager he joined the
company about eight years back as engineer trainee and became the
assistant plant manager at the Hyderabad unit, the biggest of the three
units. Manohar was very ambitious and a little too autocratic. He believed in
the exercise of authority and control to carry out his Instructions. He was
high achiever and believed in getting things done. He got quick promotions
in the company. Immediately after joining at Indore unit as plant manager,
Manohar made preliminary study of the plant and issued Instructions to all
departments to reduce their expenses by five per cent. A fortnight later, he
instructed the departments to Increase production by ten per cent. He also
instructed all supervisors to strictly adhere to budgets. He introduced
several new reports and watched the operations very closely. He
suspended two supervisors in the second month for not meeting the budget
targets. Subsequently, two supervisors left the plant. With all his efforts, the
unit was very much on the right track and within six months, exceeded the
new budgeted figures by eight per cent. On setting the plant right, he was
called back at Hyderabad unit as plant manager where vacancy arose.
However, shortly after he left for Hyderabad, the productivity at Indore unit
fell below the earlier level and the budget was again in trouble.

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CASE STUDY: SUMMARY

As seen in the above case the unit of Super Engineering Ltd in Indore was
not working efficiently. The costs exceeded the budget and the production
was slow. The unit needed proper supervision. The work culture and
organization behavior in the unit was not conducive for the higher
efficiency. To remedy this situation an ambitious and autocratic manager
Mr. P. Manohar from Hyderabad was transferred to the Indore unit.
Mr. Manohar is a high achieving and goal oriented employees who moved
up the companys ranks very fast due to his goal oriented and profit
oriented approach. He viewed the situation at the Indore unit and ordered
all departments to reduce cost by 5% and after a fortnight asked them
increase production by 10%. He let go of supervisors and employees who
were inefficient and not up to his standards. Within 6 months he got the
results he wanted and was called back to his unit in Hyderabad. But a few
months after he left the Indore unit fell to its previous condition and had
trouble maintaining the budget.
This shows that the units organization behavior did not support the
employees efficiently. The very basis of OB is to integrate the wants of the
employee with the organization so that the employee strives towards
achieving the organizational objectives. This was not achieved in the Indore
unit. Efficient leadership is an integral part of OB as a good leader sets an
example to his employees of the behavior expected of him.
It is also necessary to treat the human aspect of an organization with
respect. They are the most important resources and without them the
organization cannot work efficiently. This is seen in the above case as the
employees do not accept and respect the company enough to make an
effort to improve its production.
The model of OB followed here is autocratic model. While this model may
be criticized by some to be very harsh it is necessary as there are some
instance and some employees who refuse to work efficiently without firm
control over them as seen in the above case. Thus it is necessary that all
aspets of OB should be viewed while assessing a situation or a company
as appropriate OB or the lack thereof is the cause of most problems.

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CONCLUSION
Organization Behavior is an integral part of any organization. It is a
collection of interacting and inter related human and non-human resources
working toward a common goal or set of goals within the framework of
structured relationships. Organizational behavior is concerned with all
aspects of how organizations influence the behavior of individuals and how
individuals in turn influence organizations.
The models of Organizational Behavior collegial model, supportive model
emphasize on the importance of employees and their cooperation for the
organization to work smoothly and achieve organizational goals.
Autocratic model on the other hand, focuses on the importance of
supervision and having firm control on all operations. Custodial model
concentrates on giving employees benefits for the work that they do which
in turn makes them more dependent on the organization.
Organizational Behavior includes the social, psychological and
anthropological aspects of human life. It tells us how these affect an
employees work morale. It also takes into account the modern
technological and political aspects that affect the work culture.
The HR approach signifies the importance of workers in an organization.
Systems approach helps in looking at all the operations as a whole.
Contingency approach tells that there is no one best way and helps in
searching for alternatives.
Organizational Behavior helps in minimizing the industrial disputes that
frequently occur and lead to lock-outs or strikes. It helps in maintaining a
positive approach towards working habits. It helps in maintaining a
conducive work climate which encourages employees to work better.
Hence it is important for any firm to possess good Organization Behavior.

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BIBLIOGRAPHY
Books
Management Processes and Organization Behavior by L.M.
Prasad
Organizational Behavior by K. Ashwathappa
Organizational Behavior by Vinay Prabhu
Economic and Financial Indicator
Websites
www.google.com
www.business.gov.in
www.scribd.com
Magazine
Business Line
Economic Times Magazine

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