MODULE 1: INTRODUCTION TO HUMAN BEHAVIOR IN ORGANIZATIONS

LESSON1:
INTENDED LEARNING OUTCOMES

At the end of this module the students must be able to:

1. Define organizational behavior, including its difference contexts.
2. Identify the basic management functions and essential skills that compromise the management
process and relate them to organizational behavior
3. Discuss diversity the emergence of globalization and cross-cultural differences and similarities.

Understanding Organizational Behavior (OB)

The study of organizational behavior includes areas of research dedicated to improving job
performance, increasing job satisfaction, promoting innovation, and encouraging leadership. Each
has its own recommended actions, such as reorganizing groups, modifying compensation structures,
or changing methods of performance evaluation.

Organizational Behavior Origins

The study of organizational behavior has its roots in the late 1920s, when the Western Electric
Company launched a now-famous series of studies of the behavior of workers at its Hawthorne
Works plant in Cicero, Ill.
Researchers there set out to determine whether workers could be made to be more productive if their
environment was upgraded with better lighting and other design improvements. To their surprise, the
researchers found that the environment was less important than social factors. It was more important,
for example, that people got along with their co-workers and felt their bosses appreciated them.

Those initial findings inspired a series of wide-ranging studies between 1924 and 1933.They included
the effects on productivity of work breaks, isolation, and lighting, among many other factors.

The Hawthorne Effect—which describes the way test subjects' behavior may change when they know
they are being observed—is the best-known study of organizational behavior. Researchers are taught
to consider whether or not (and to what degree) the Hawthorne Effect may skew their findings on
human behavior.

Organizational behavior was not fully recognized by the American Psychological Association as a
field of academic study until the 1970s. However, the Hawthorne research is credited for validating
organizational behavior as a legitimate field of study, and it's the foundation of the human resources
(HR) profession as we now know it.

Special Considerations
The leaders of the Hawthorne study had a couple of radical notions. They thought they could use the
techniques of scientific observation to increase an employee's amount and quality of work, and they
did not look at workers as interchangeable resources. Workers, they thought, were unique in terms of
their psychology and potential fit within a company.

Over the following years, the concept of organizational behavior widened. Beginning with World War
II, researchers began focusing on logistics and management science. Studies by the Carnegie School
in the 1950s and 1960s solidified these rationalist approaches to decision-making.3

Today, those and other studies have evolved into modern theories of business structure and
decision-making. The new frontiers of organizational behavior are the cultural components of
organizations, such as how race, class, and gender roles affect group building and productivity.
These studies take into account how identity and background inform decision-making.

Academic programs focusing on organizational behavior are found in business schools, as well as at
schools of social work and psychology. These programs draw from the fields of anthropology,
ethnography, and leadership studies, and use quantitative, qualitative, and computer models as
methods to explore and test ideas.

Depending on the program, one can study specific topics within organizational behavior or broader
fields within it. Specific topics covered include cognition, decision-making, learning, motivation,
negotiation, impressions, group process, stereotyping, and power and influence. The broader study
areas include social systems, the dynamics of change, markets, relationships between organizations
and their environments, how social movements influence markets, and the power of social networks.

Examples of Organizational Behavior

Findings from organizational behavior research are used by executives and human relations
professionals to better understand a business’s culture, how that culture helps or hinders productivity
and employee retention, and how to evaluate candidates' skills and personality during the hiring
process.

Organizational behavior theories inform the real-world evaluation and management of groups of
people. There are several components:
Personality plays a large role in the way a person interacts with groups and produces work.
Understanding a candidate's personality, either through tests or through conversation, helps
determine whether they are a good fit for an organization.
Leadership—what it looks like and where it comes from—is a rich topic of debate and study within the
field of organizational behavior. Leadership can be broad, focused, centralized or de-centralized,
decision-oriented, intrinsic in a person’s personality, or simply a result of a position of authority.
Power, authority, and politics all operate inter-dependently in a workplace. Understanding the
appropriate ways these elements are exhibited and used, as agreed upon by workplace rules and
ethical guidelines, are key components to running a cohesive business.

Why Is Organizational Behavior Important?

Organizational behavior describes how people interact with one another inside of an organization,
such as a business. These interactions subsequently influence how the organization itself behaves
and how well it performs. For businesses, organizational behavior is used to streamline efficiency,
improve productivity, and spark innovation to give firms a competitive edge.

What Are the 4 Elements of Organizational Behavior?

The four elements of organizational behavior are people, structure, technology, and the external
environment. By understanding how these elements interact with one another, improvements can be
made. While some factors are more easily controlled by the organization—such as its structure or
people hired—it still must be able to respond to external factors and changes in the economic
environment.

What Are the 3 Levels of Organizational Behavior?

The first is the individual level, which involves organizational psychology and understanding human
behavior and incentives.
The second level is groups, which involves social psychology and sociological insights into human
interaction and group dynamics.
The top-level is the organizational level, where organization theory and sociology come into play to
undertake systems-level analyses and the study of how firms engage with one another in the
marketplace.

What Are Some Common Problems that Organizational Behavior Tries to Solve?
Organizational behavior can be used by managers and consultants to improve the performance of an
organization and to address certain key issues that commonly arise. These may include a lack of
direction or strategic vision for a company, difficulty getting employees on board with that vision,
pacifying workplace conflict or creating a more amenable work environment, issues with training
employees, poor communication or feedback, and so on. (KOPP, 2022)

Organizational Culture: Definition, Importance, and Development May 02, 2023

What is organizational culture?
Organizational culture is the collection of values, expectations, and practices that guide and inform
the actions of all team members. Think of it as the collection of traits that make your company what it
is. A great culture exemplifies positive traits that lead to improved performance, while a dysfunctional
company culture brings out qualities that can hinder even the most successful organizations.

Don’t confuse culture with organizational goals or a mission statement, although both can help define
it. Culture is created through consistent and authentic behaviors, not press releases or policy
documents. You can watch company culture in action when you see how a CEO responds to a crisis,
how a team adapts to new customer demands, or how a manager corrects an employee who makes
a mistake.
The importance of culture to your company
Organizational culture affects all aspects of your business, from punctuality and tone to contract
terms and employee benefits. When workplace culture aligns with your employees, they’re more likely
to feel more comfortable, supported, and valued. Companies that prioritize culture can also weather
difficult times and changes in the business environment and come out stronger.

Culture is a key advantage when it comes to attracting talent and outperforming the competition. 77
percent of workers consider a company’s culture before applying, and almost half of employees
would leave their current job for a lower-paying opportunity at an organization with a better culture.
The culture of an organization is also one of the top indicators of employee satisfaction and one of the
main reasons that almost two-thirds (65%) of employees stay in their job.
Consider Microsoft and Salesforce. Both technology-based companies are world-class performers
and admired brands, and both owe this in part to prioritizing culture. Microsoft, known for its cut-throat
competitiveness under Steve Balmer, has been positively transformed by Satya Nadella, who took
over as CEO of the company in 2014. He embarked on a program to refine the company culture, a
process that upended competitiveness in favor of continuous learning. Instead of proving themselves,
employees were encouraged to improve themselves. Today Microsoft’s market cap flirts with $1
trillion and it is again competing with Apple and Amazon as one of the most valuable companies in
the world.

Salesforce puts corporate culture front and center and has experienced incredible growth throughout
its history. Marc Benioff, Salesforce’s founder and CEO, established philanthropic cultural norms that
have guided the company over the past two decades. All new Salesforce employees spend part of
their first day volunteering and receive 56 hours of paid time to volunteer a year. This focus on
meaning and mission has made Salesforce one of the best places to work in America according to
Fortune, and it hasn’t compromised profits either: Salesforce’s stock price has surged year after year
at an average of over 26% annually to date.
Qualities of a great organizational culture
Every organization’s culture is different, and it’s important to retain what makes your company unique.
However, the cultures of high-performing organizations consistently reflect certain qualities that you
should seek to cultivate:

● Alignment comes when the company’s objectives and its employees’ motivations are all pulling

in the same direction. Exceptional organizations work to build continuous alignment to their
vision, purpose, and goals.

● Appreciation can take many forms: a public kudos, a note of thanks, or a promotion. A culture

of appreciation is one in which all team members frequently provide recognition and thanks for
the contributions of others.

● Trust is vital to an organization. With a culture of trust, team members can express themselves

and rely on others to have their back when they try something new.

● Performance is key, as great companies create a culture that means business. In these

companies, talented employees motivate each other to excel, and, as shown above, greater
profitability and productivity are the results.

● Resilience is a key quality in highly dynamic environments where change is continuous. A

resilient culture will teach leaders to watch for and respond to change with ease.

● Teamwork encompasses collaboration, communication, and respect between team members.

When everyone on the team supports each other, employees will get more done and feel
happier while doing it.

● Integrity, like trust, is vital to all teams when they rely on each other to make decisions,

interpret results, and form partnerships. Honesty and transparency are critical components of
this aspect of culture.

● Innovation leads organizations to get the most out of available technologies, resources, and

markets. A culture of innovation means that you apply creative thinking to all aspects of your
business, even your own cultural initiatives.

● Psychological safety provides the support employees need to take risks and provide honest

feedback. Remember that psychological safety starts at the team level, not the individual level,
so managers need to take the lead in creating a safe environment where everyone feels
comfortable contributing.

8 steps to building a high-performing organizational culture

Creating a great organizational culture requires developing and executing a plan with clear objectives
that you can work towards and measure. The 8 steps below should serve as a roadmap for building a
culture of continuity that will deliver long-term benefits across your company.
1. Excel in recognition
Recognizing the contributions of all team members has a far-reaching, positive effect on
organizational culture. When everyone on the team recognizes the accomplishments of others,
individuals start to see how they’re part of a whole.
2. Enable employee voice
Creating a culture that values feedback and encourages employee voice is essential, as failing to do
so can lead to lost revenue and demotivated employees.
3. Make your leaders culture advocates
Your company’s success in building a strong workplace culture rests in the hands of team leaders
and managers.

4. Live by your company values

Your company’s values are the foundation of its culture. While crafting a mission statement is a great
start, living by company values means weaving them into every aspect of your business. This
includes support terms, HR policies, benefits programs, and even out-of-office initiatives like
volunteering. Your employees, partners, and customers will recognize and appreciate that your
organization puts its values into practice every day. You can also recognize employees for actions
that exemplify your values to show that they’re more than just words and incentivize employees to
build the value-based culture you want to see.
5. Forge connections between team members
Building a workplace culture that can handle adversity requires establishing strong connections
between team members, but with increasingly remote and terse communication, creating those bonds
can be challenging. Encouraging collaboration and engaging in team building activities — even when
working remote — are two effective ways to bring your team together and promote communication.
6. Focus on learning and development
Great workplace cultures are formed by employees who are continually learning and companies that
invest in staff development. Training initiatives, coaching, and providing employees with new
responsibilities are all great ways to show your team that you’re invested in their success.
7. Keep culture in mind from day one
When an employee’s perspective doesn’t match your company culture, internal discord is likely to be
the result. Organizations should hire for culture and reinforce it during the onboarding process and
beyond. Practices and procedures must be taught, and values should be shared.
8. Personalize the employee experience
As modern consumers, your employees expect personalized experiences, so you need to focus on
ways to help each team member identify with your culture. Tools like pulse surveys and employee-
journey mapping are great ways to discover what your employees value and what their ideal
corporate culture looks like. Take what you learn and tailor your actions to personalize the employee
experience for your team. Once you start treating your employees with the same care you treat your
customers, a culture that motivates each individual at your organization is sure to follow.(Wong, 2021)

9 Types of Organizational Structure Every Company Should Consider

Written by Erik Devaney @bardofboston

An organizational structure is a visual diagram of a company that describes what employees do,
whom they report to, and how decisions are made across the business. Organizational structures can
use functions, markets, products, geographies, or processes as their guide, and cater to businesses
of specific sizes and industries.

What's the point of an organizational structure? As a business leader, do you even need one? As I
said, org structures help you define at least three key elements of how your business is going to run.

As your company gets bigger, an organizational structure can also be helpful for new employees as
they learn who manages what processes at your company.

Then, if you need to pivot or shift your leadership, you can visualize how the work flows would work
by adjusting your organizational structure diagrams.

To put it simply, this chart like a map that simply explains how your company works and how its roles
are organized.

Here's what each of those elements means to an organization:

Chain of Command
Your chain of command is how tasks are delegated and work is approved. An org structure allows
you to define how many "rungs of the ladder" a particular department or business line should have. In
other words, who tells whom to do what? And how are issues, requests, and proposals
communicated up and down that ladder?

Span of Control
Your span of control can represent two things: who falls under a manager's, well, management ... and
which tasks fall under a department's responsibility.

Centralization
Centralization describes where decisions are ultimately made. Once you've established your chain of
command, you'll need to consider which people and departments have a say in each decision. A
business can lean toward centralized, where final decisions are made by just one or two entities; or
decentralized, where final decisions are made within the team or department in charge of carrying out
that decision.

You might not need an org structure right away, but the more products you develop and people you
hire, the harder it'll be to lead your company without this crucial diagram.

Mechanistic vs. Organic Organizational Structures

Organizational structures fall on a spectrum, with "mechanistic" at one end and
"organic" at the other.

Take a look at the diagram below. As you'll probably be able to tell, the mechanistic structure
represents the traditional, top-down approach to organizational structure, whereas the organic
structure represents a more collaborative, flexible approach.

Here's a breakdown of both ends of the structural spectrum, their advantages and disadvantages,
and which types of businesses are suited for them.
Mechanistic Structure
Mechanistic structures, also called bureaucratic structures, are known for having narrow spans of
control, as well as high centralization, specialization, and formalization. They're also quite rigid in
what specific departments are designed and permitted to do for the company.

This organizational structure is much more formal than organic structure, using specific standards
and practices to govern every decision the business makes. And while this model does hold staff
more accountable for their work, it can become a hindrance to the creativity and agility the
organization needs to keep up with random changes in its market.
As daunting and inflexible as mechanistic structure sounds, the chain of command, whether long or
short, is always clear under this model. As a company grows, it needs to make sure everyone (and
every team) knows what's expected of them. Teams collaborating with other teams as needed might
help get a business off the ground in its early stages, but sustaining that growth -- with more people
and projects to keep track of -- will eventually require some policymaking. In other words, keep
mechanistic structure in your back pocket ... you never know when you'll need it.

Organic Structure
Organic structures (also known as "flat" structures) are known for their wide spans of control,
decentralization, low specialization, and loose departmentalization. What's that all mean? This model
might have multiple teams answering to one person and taking on projects based on their importance
and what the team is capable of -- rather than what the team is designed to do.

As you can probably tell, this organizational structure is much less formal than mechanistic, and takes
a bit of an ad-hoc approach to business needs. This can sometimes make the chain of command,
whether long or short, difficult to decipher. And as a result, leaders might give certain projects the
green light more quickly but cause confusion in a project's division of labor.

Nonetheless, the flexibility that an organic structure allows for can be extremely helpful to a business
that's navigating a fast-moving industry, or simply trying to stabilize itself after a rough quarter. It also
empowers employees to try new things and develop as professionals, making the organization's
workforce more powerful in the long run. Bottom line? Startups are often perfect for organic structure,
since they're simply trying to gain brand recognition and get their wheels off the ground.

Now, let's uncover more specific types of organizational structures, most of which fall on the more
traditional, mechanistic side of the spectrum.

Types of Organizational Structure

✔ Functional Organizational Structure

An organization with a functional org structure, for instance, would group all of the marketers
together in one department, group all of the salespeople together in a separate department,
and group all of the customer service people together in a third department.

✔ Product-Based Divisional Structure

A divisional organizational structure is comprised of multiple, smaller functional structures (i.e.

each division within a divisional structure can have its own marketing team, its own sales team,
and so on). In this case -- a product-based divisional structure -- each division within the
organization is dedicated to a particular product line.
✔ Market-Based Divisional Structure

Another variety of the divisional organizational structure is the market-based structure, wherein
the divisions of an organization are based around markets, industries, or customer types.
The market-based structure is ideal for an organization that has products or services that are
unique to specific market segments, and is particularly effective if that organization has
advanced knowledge of those segments. This organizational structure also keeps the business
constantly aware of demand changes among its different audience segments.

✔ Geographical Divisional Structure

The geographical organizational structure establishes its divisions based on -- you guessed it
-- geography. More specifically, the divisions of a geographical structure can include territories,
regions, or districts.
This type of structure is best-suited to organizations that need to be near sources of supply
and/or customers (e.g. for deliveries or for on-site support). It also brings together many forms
of business expertise, allowing each geographical division to make decisions from more
diverse points of view.

✔ Process-Based Structure

Process-based organizational structures are designed around the end-to-end flow of different
processes, such as "Research & Development," "Customer Acquisition," and "Order
Fulfillment." Unlike a strictly functional structure, a process-based structure considers not only
the activities employees perform, but also how those different activities interact with one
another.
Process-based organizational structure is ideal for improving the speed and efficiency of a
business, and is best-suited for those in rapidly changing industries, as it is easily adaptable.

✔ Matrix Structure

Unlike the other structures we've looked at so far, a matrix organizational structure doesn't
follow the traditional, hierarchical model. Instead, all employees have dual reporting
relationships. Typically, there is a functional reporting line as well as a product- based
reporting line.
When looking at a matrix structure org chart, solid lines represent strong, direct-reporting
relationships, whereas dotted lines indicate that the relationship is secondary, or not as strong.
The main appeal of the matrix structure is that it can provide both flexibility and more balanced
decision-making (as there are two chains of command instead of just one). Having a single
project overseen by more than one business line also creates opportunities for these business
 lines to share resources and communicate more openly with each other -- things they might
not otherwise be able to do regularly.

✔ Circular Structure

While it might appear drastically different from the other organizational structures highlighted in
this section, the circular structure still relies on hierarchy, with higher-level employees
occupying the inner rings of the circle and lower-level employees occupying the outer rings.
That being said, the leaders or executives in a circular organization aren't seen as sitting atop
the organization, sending directives down the chain of command. Instead, they're at the center
of the organization, spreading their vision outward.
From an ideological perspective, a circular structure is meant to promote communication and
the free flow of information between different parts of the organization. Whereas a traditional
structure shows different departments or divisions as occupying individual, semi-autonomous
branches, the circular structure depicts all divisions as being part of the same whole.

✔ Flat Structure

While a more traditional organizational structure might look more like a pyramid -- with multiple
tiers of supervisors, managers and directors between staff and leadership, the flat structure
limits the levels of management so all staff are only a few steps away from leadership. It also
might not always take the form or a pyramid, or any shape for that matter. As we mentioned
earlier, It's also a form of the "Organic Structure" we noted above.
This structure is probably one of the most detailed, It's also thought that employees can be
more productive in an environment where there's less hierarchy-related pressures. This
structure might also make staff feel like the managers they do have are more like equals or
team members rather than intimidating superiors.

✔ Network Structure

A network structure is often created when one company works with another to share resources
-- or if your company has multiple locations with different functions and leadership. You might
also use this structure to explain your company workflows if much of your staffing or services is
outsourced to freelancers or multiple other businesses.

The structure looks nearly the same as the Divisional Structure, shown above. However,
instead of offices, it might list outsourced services or satellite locations outside of the office.

If your company doesn't do everything under one roof, this is a great way to show employees
or stakeholders how outsourcing of off-site processes work. For example, if an employee
needs help from a web developer for a blogging project and the company's web developers
are outsourced, the could look at this type of chart and know which office or which person to
contact outside of their own work location. ( Devaney, 2022)

5 Principles of Great Management

Principle No. 1: The Functions of Management

While managers often view their work as task or supervisory in orientation, this view is an
illusion.

At the most fundamental level, management is a discipline that consists of a set of five general
functions: planning, organizing, staffing, leading and controlling. These five functions are part
of a body of practices and theories on how to be a successful manager.

Understanding the functions will help managers focus efforts on activities that gain results.
Summarizing the five functions of great management (ICPM Management Content):

Planning: When you think of planning in a management role, think about it as the process of
choosing appropriate goals and actions to pursue and then determining what strategies to use,
what actions to take, and deciding what resources are needed to achieve the goals.
Organizing: This process of establishing worker relationships allows workers to work together
to achieve their organizational goals.
Leading: This function involves articulating a vision, energizing employees, inspiring and
motivating people using vision, influence, persuasion, and effective communication skills.
Staffing: Recruiting and selecting employees for positions within the company (within teams
and departments).
Controlling: Evaluate how well you are achieving your goals, improving performance, taking
actions. Put processes in place to help you establish standards, so you can measure,
compare, and make decisions.
Principle No. 2: The Types and Roles of Managers within the Organization
Organizational structure is important in driving the business forward and every organization has a
structure. No matter the organizationally specific title, organizations contain front-line, middle, and top
managers. Above the top management team are a CEO and a board of director levels. To see this
structure even more clearly, visualize a pyramid model. The more you move toward the top of the
pyramid, the fewer managers you have. All of these management roles have specific tasks and
duties. According to Jones and George, “A managerial role is the set of specific tasks that a manager
is expected to perform because of the position he or she holds in an organization.” These skills can
be gained with a degree in organizational management.

All great managers play important roles in this model. One important thing to remember is from Henry
Mintzberg, a management scholar who researched and reduced thousands of tasks performed by
managers to 10 roles (ICPM). His model points out that there are three main types of roles all
managers play; they are decisional, interpersonal, and informational. In the decisional role, managers
can perform in an entrepreneurial manner, as a disturbance handler, resource allocator or negotiator.
In an interpersonal role, managers may be figureheads, leaders, and liaisons. In the informational
role, they monitor, are disseminators or spokespersons, and they share information.

Principle No. 3: Effective Management of Organizational Resources

An essential component of operationalizing the organization’s strategic plan is allocating resources
where they will make the most impact. In fact, Dr. Ray Powers (2015), associate dean in the Forbes
School of Business & Technology, argues that it is the most important thing to do.

“I define resources as people, time, money, and assets — and of course the basic definition of a
project is to have a goal and a start and end date — for pretty much any activity we do,” he explains.

Managers participate in operational planning and budget planning processes and, in doing so,
actively determine what should be done, in what order it is to be done, and determine what resources
are appropriate to be successful in achieving the plan. Keep in mind that this is not a personality
contest. The strategic plan and its specific objectives determine what is important and what may not
be as important.

Principle No. 4: Understanding and Applying the Four Dimensions of Emotional Intelligence (EQ) in
Maximizing Human Potential
Effective managers understand the context and culture in leadership situations. What helps these
managers succeed? It is simple; they understand EQ (the competencies in each dimension of
emotional intelligence).

Those four dimensions are: a high self-awareness, social awareness, self-management, and good
social skills. All of these competencies are important, and they lead to great connections with people.
They lead to stronger and more effective managerial performance. EQ is a very important component
for excelling as a supervisor.

The job of the manager is to find a way to turn a team member’s skill and talent into a higher level of
performance. This idea doesn’t suggest manipulation at all. Instead, it is about maximizing human
potential, one team member at a time. It is as much art as it is science.

Dr. Diane Hamilton, program chair in the Forbes School of Business & Technology, recently
described a candidate seeking a position on the faculty senate with having a high EQ. Dr. Hamilton, a
highly skilled professional who possesses knowledge and skill in the area of Meyers Briggs Type
Indicator, recognizes the importance of EQ.

“He demonstrates emotional intelligence and exemplifies the high caliber of candidate I would like to
represent the FSB,” she said about the candidate.
Principle No. 5: Know the Business
A common axiom in management is that a qualified manager can manage any business. This point is
only partially true. It is true that most managers are generalists rather than specialists; however, many
very successful managers began their careers in specialist roles. What most successful managers
bring to their work in leading crews, departments, divisions, and companies is both a solid knowledge
of the business (they are very experienced) and a solid knowledge of the principles of great
management. Manager aspirants must first learn the characteristics of the business by doing, working
in the trenches, and discovering how the various pieces of the organization work together to become
a universal whole because very good managers discover what is universal in the business and
capitalize on it to advance the business and improve performance.

Conclusion
Remember, as a manager, for greater job satisfaction and career success you should align to your
organization’s vision, mission, strategies, leadership, systems, structure, and cultures. In all you do,
treat people fairly and honestly and do your best to follow and embrace your organization’s ethics and
core values as well as your own. Talk the walk and walk the talk, and remember, people are watching
and seeing how you walk it. Give your very best to your teams, organizations, and customers. Be an
effective manager to get the performance results for your organization and build trust and positive
relationship with your people. (Davis, 2021)

What are the types of diversity?

Based on the standard diversity definition, the types of diversity in a social context are theoretically
infinite: they encompass every characteristic that appears with variations among a group of people
(such as hair or eye color). But usually, when it comes to workplaces, there are seven types of
diversity we pay attention to.

Here’s a list of the different types of diversity in the workplace:

● Cultural diversity

● Racial diversity

● Religious diversity

● Age diversity

● Sex / Gender diversity

● Sexual orientation

● Disability
Here’s a breakdown of these forms of diversity:

Cultural diversity
This type of diversity is related to each person’s ethnicity and it’s usually the set of norms we get from
the society we were raised in or our family’s values. Having different cultures in the workplace is more
common in multinational companies.

Race diversity
Race has to do with a person’s grouping based on physical traits (despite the dominant scientific view
that race is a social construct and not biologically defined). Examples of races are Caucasian,
African, Latino and Asian.

Religious diversity
This type of diversity refers to the presence of multiple religions and spiritual beliefs (including lack
thereof) in the workplace.

Age diversity
Age diversity means working with people of different ages and, most importantly, generations. For
example, millennials, GenZers and GenXers can coexist in the same workplace.

Sex / Gender / Sexual orientation

Sex and gender can be used in the traditional sense of male and female employees. For example,
you may sometimes hear the term “gender balance” used by companies trying to achieve a 50-50
balance between employees who identify as male and employees who identify as female. But, as
gender is increasingly redefined, the term “gender diversity” may be more appropriate, since there are
multiple variations in gender and sexual orientation.

Disability
There are various types of disabilities or chronic conditions included here, ranging from mental to
physical. Companies often make reasonable accommodations to help people with disabilities
integrate into the workplace, such as installing ramps for wheelchairs or providing mental health
support. Some companies also adjust their hiring process to make sure it's inclusive.

Protected by law
The characteristics corresponding to these forms of diversity are protected by law in many countries:
these “protected characteristics” are attributes that companies shouldn’t take into account when
making employment decisions (especially adverse decisions, like terminating employees or rejecting
job candidates). For example, you mustn’t decide to reject an applicant for a job simply because
they’re Asian, female or a person with disabilities.

Conversely, it’s good practice to strive to have all these diversity categories in your workforce by
eliminating biases and using affirmative action plans.

Additional types of diversity

Apart from protected characteristics, there are other important types of diversity, too, like:

Socioeconomic background / Class diversity

Education
Life experiences
Personality
General worldview / opinions

These are characteristics that are more intangible than protected characteristics, but it’s equally
useful to take them into account inside the business context.

Why is diversity important?

The business case for diversity has been thoroughly laid out for years. If every team member has the
same backgrounds, attributes or perspectives, their team might not be as creative and successful as
it could. Homogeneity deprives teams from healthy conflict that brings innovation and progress.
(workable better hiring)

As technology and transportation have advanced, business has become increasingly global. In
addition to new challenges and international tensions, purposeful expansion has brought new jobs,
customer audiences, and economic opportunity.

WHAT IS GLOBALIZATION?

Globalization is the increase in the flow of goods, services, capital, people, and ideas across
international boundaries, according to the online course Global Business.

“We live in an age of globalization,” says Harvard Business School Professor Forest Reinhardt, who
teaches Global Business. “That is, national economies are ever more tightly connected with one
another than ever before.”

Whether you’re looking to learn more about your international company or thinking of expanding your
business into other countries, you need a strong foundation in the basics of globalization in business.
Here’s a primer on what it means to be an international business, factors to consider when
approaching the global business landscape, and how to build your knowledge.

WHAT DOES IT MEAN TO BE AN INTERNATIONAL BUSINESS?

An international business is any company that operates and produces or sells goods between two or
more countries. There are three ways a business can be considered international:

It produces goods domestically and sells domestically and internationally.

It produces goods in a different country but sells domestically.
It produces goods in a different country and sells domestically and internationally.
If your business falls into one of these categories, there are two types of international business
models to consider: transnational and multinational.

Transnational corporations have offices in multiple countries, each responsible for a different facet of
the organization. For instance, marketing may be based in London, research and development in
Bogota, and software development in New York.

An example of a successful transnational corporation is Nestlé, which splits business operations for
each of its brands by region. There are over 100 Nestlé offices worldwide with distinct responsibilities.
For instance, the Nestlé Research Center is located in Switzerland, which acts as the hub that
oversees each brand-specific research and development center, of which there are 23. All Nestlé
offices operate under the company’s headquarters in Switzerland.

Multinational corporations also have offices in multiple countries, but unlike transnational
corporations, each is a microcosm of the larger organization. This means each office has, for
example, its own leadership, marketing, sales, research and development, technology, and human
resources teams. An example of a multinational corporation is PepsiCo, which has 32 offices across
24 countries.

If you’re considering which international business model to implement for your growing company,
know that each has its pros and cons. Transnational corporations typically have the benefit of
everyone on a specific team being located in the same office, although this may change with the rise
of remote work. Being in the same office can decrease miscommunication and reinforce the idea that
each office is an integral part of the larger company. Multinational companies may not beget this
same mindset, but they benefit from having someone from every team present in each office. This
can enable them to collaborate and tailor efforts to the audience in their specific location without
juggling time differences and language barriers to collaborate with other teams.

There’s no one-size-fits-all approach to globalization; only you can decide what works best for your
business.
FACETS OF GLOBAL BUSINESS TO CONSIDER
Globalization doesn’t just refer to the location of a firm’s offices and customers—it also encompasses
the nuances and economic factors of conducting business internationally and existing in a global
economy. Even if your company operates domestically, globalization can influence the way you do
business. Here are a few factors to consider when thinking about how global business impacts your
organization:

Politics and laws: International politics can color relationships between nations and regulate what
products are allowed in and out of their borders. Keeping up with current events can help you prepare
for the business impacts of shifts in policy and foreign affairs.
The environment: There’s no global issue more pressing than climate change. Unfortunately,
globalization can contribute significantly to its negative effects due to increased transportation of
materials and products, business travel, and the number of factories. If you’re engaging in global
business, keep sustainability in mind to avoid contributing to climate change.
Macroeconomics: Principles of macroeconomics can allow you to compare countries’ financial health
on a one-to-one basis and draw connections between trends. Some metrics to know include:
Gross domestic product (GDP)
Unemployment rate
Inflation rate
Degree of income inequality
Currency exchange rate
Human rights: Because laws dictating human rights—including labor laws—differ from country to
country, operating as a global business requires research and critical thought to ensure you’re not
exploiting people for labor, even if it’s technically legal. Ethics are required for making decisions that
may cost your business money at the expense of protecting human rights.
Cultural differences and language barriers: Operating a global business requires knowing and
respecting other cultures. Without understanding the areas you do business in, you could
unintentionally offend someone and harm your working relationships. In the case of language
barriers, this may require you to hire translators and multilingual employees to bridge the gap. (Cote,
2021)

Activity

1. What is OB?
2. Why OB is important?
3. Give the functions of Great Management.
Reference:

Internet Source

1. KOPP, C. (2022). Organizational Behavior (OB)

Retrieved from: https://www.investopedia.com/terms/o/organizational-

behavior.asp#:~:text=Organizational%20behavior%20is%20the%20academic,make%20businesses
%20operate%20more%20effectively.

2. .(Wong, 2021) Organizational Culture: Definition, Importance, and Development

Retrieved from: https://www.achievers.com/blog/organizational-culture-definition/

3. Devaney, E. (2020). 9 Types of Organizational Structure Every Company Should Consider

Retrieved from: https://blog.hubspot.com/marketing/team-structure-diagrams

4. Davis, B. (2021). 5 Principles of Great Management

Retrieved from: uagc.edu/blog/5-principles-of-great-management#:~:

5. (workable better hiring)

Retrieved from: (https://resources.workable.com/)

6. Cote, C. (2021) WHAT IS GLOBALIZATION IN BUSINESS?

Retrieved from: https://online.hbs.edu/blog/post/what-is-globalization-in-business