11 Introduction to OB

Organisational Behaviour tries to understand human behaviour in the organization. OB is a part of

total management but plays a very important role in every area of management and has been accepted
by all the people concerned. The mangers now understand that to make their organization more
effective, they have to understand and predict the human behaviour in the organization.
ORGANIZATIONAL BEHAVIOUR [OB]
“No one really knows why humans do what they do.” - David K. Reynolds
Organizational behaviour [OB] is the study of how people behave both individually and within
informal and formal groups. Every organization’s performance is ultimately dependent on the
motivational levels of its human resources and the willingness and ability of people to work
harmoniously and effectively towards the accomplishment of shared goals. It is the duty of every
leader to respect individual values, job satisfaction, and ensure collective involvement. Having
challenging selection, training, and rewards for employees’ ushers in and helps shape team players.

Definitions of OB
According to Stephen P Robbins - “Organisational behaviour is a field of study that investigates the
impact that individuals, groups and structure have on behaviours within the organizations for the
purpose of applying such knowledge towards improving an organizations effectiveness”.
According to Fred Luthans - “Organisational behaviour is directly concerned with the
understanding production and control of human behaviour in organization”.
According to Raman J Aldag – “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 organizations”.
According to L. M. Prasad, “Organisational behaviour can be defined as the study and application of
knowledge about human behaviour related to other elements of an organisation such as structure,
technology and social systems.”
By analysing the above definitions, we can define OB as a behavioural Science that states about:
• Nature of Man
• Nature of the Organization
• Knowledge of human would be useful in improving an organization’s effectiveness.
NATURE OF ORGANIZATIONAL BEHAVIOUR
Organizational behaviour has emerged as a separate field of study. The nature it has acquired is
identified as follows:
1. A Separate Field of Study and Not a Discipline Only:
By definition, a discipline is an accepted science that is based on a theoretical foundation. But, O.B.
has a multi- interdisciplinary orientation and is, thus, not based on a specific theoretical background.
Therefore, it is better reasonable to call O.B. a separate field of study rather than a discipline only.
2. An Interdisciplinary Approach:
Organizational behaviour is essentially an interdisciplinary approach to study human behaviour at
work. It tries to integrate the relevant knowledge drawn from related disciplines like psychology,
sociology and anthropology to make them applicable for studying and analysing organizational
behaviour.
3. An Applied Science:
The very nature of O.B. is applied. What O.B. basically does is the application of various researches
to solve the organizational problems related to human behaviour. The basic line of difference between
pure science and O.B. is that while the former concentrates of fundamental researches, the latter
concentrates on applied researches. O.B. involves both applied research and its application in
organizational analysis. Hence, O.B. can be called both science as well as art.
4. A Normative Science:
Organizational Behaviour is a normative science also. While the positive science discusses only cause
effect relationship, O.B. prescribes how the findings of applied researches can be applied to socially
accepted organizational goals. Thus, O.B. deals with what is accepted by individuals and society
engaged in an organization. Yes, it is not that O.B. is not normative at all. In fact, O.B. is normative as
well that is well underscored by the proliferation of management theories.
5. A Humanistic and Optimistic Approach:
Organizational Behaviour applies humanistic approach towards people working in the organization. It,
deals with the thinking and feeling of human beings. O.B. is based on the belief that people have an
innate desire to be independent, creative and productive. It also realizes that people working in the
organization can and will actualise these potentials if they are given proper conditions and
environment. Environment affects performance or workers working in an organization.
6. A Total System Approach:
The system approach is one that integrates all the variables, affecting organizational functioning. The
systems approach has been developed by the behavioural scientists to analyse human behaviour in
view of his/her socio-psychological framework. Man’s socio- psychological framework makes man a
complex one and the systems approach tries to study his/her complexity and find solution to it.
SCOPE OF ORGANIZATIONAL BEHAVIOUR
The three internal organizational elements viz., people, technology and structure and the fourth
element, i.e., external social systems may be taken as the scope of O.B.
People: The people constitute the internal social system of the organization. They consist of
individuals and groups. Groups may be large or small, formal or informal, official or unofficial. They
are dynamic. They form, change and disband. People are living, thinking and feeling being who
created the organization and try to achieve the objectives and goals. Thus, organizations exist to serve
the people and not the people exist to serve the organization.
Structure: Structure defines the sole relationship of people in an organization. Different people in an
organization are given different roles and they have certain relationship with others. All are so related
to each other to accomplish the goal in a co-ordinated manner. Thus, structure relates to power and
duties. One has the authority and others have a duty to obey him.
Technology: Technology imparts the physical and economic conditions within which people work.
With their bare hands people can do nothing so they are given assistance of buildings, machines,
tools, processes and resources. Thus, technology brings effectiveness and at the same restricts people
in various ways.
Social System: Social system provides external environment which the organization operates. A
single organization cannot exist also. It is a part of the whole. All organizations influence each other.
It influences the attitudes of people, their working conditions and above all provides competition for
resources and power.

Importance of OB
1) OB provides a road map to our lives in organizations
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 doing 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 interest. Such a range of human behaviours 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. Therefore, OB need to map out organizational events so that employee can
function in a more secure and comfortable environment.
2) A Manager in a Business Establishment is concerned with Getting Things Done Through
Delegation
He or she 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.
3) The field of OB is useful for improving Cordial Industrial/Labour Relations
If an employee is slow in his/her work, or if his/her productivity is steadily declining, it is not always
because of a poor work environment. 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 to
understand the cause of the problem, predict its course of action, and control its consequences. The
field of OB serves as the basis for human resource management.
4) OB helps in motivating employees
OB helps manager to motivate the employees bringing a good organizational performance
automatically that leads to job satisfaction. It helps managers to apply appropriate motivational tools
and techniques in accordance with the nature of individual employees.
5) OB helps effective utilization of human resources
OB helps managers to manage the people’s behaviour and the organization effectively. It enables
managers to inspire and motivates employees towards high productivity and better results.
Relationship between OB and Individuals
OB highlights on its several aspects like:
a. Way of thinking—requires clearly identifying the level of analysis (individual, group,
organizational).
b. Multi-disciplinary—draws principles, theories, and models from psychology, sociology and
cultural
anthropology.
c. Humanistic orientation—assumes that individual feelings, attitudes, perceptions, goals, etc., are
important to the organization.
d. Performance-oriented—focusing on whether and why individual/group/organization performance
is high, moderate, or low.
e. External environment—substantially impacts organizational behaviour.
f. Scientific method—plays a critical role in OB research.
g. Applications oriented—concerned with providing useful/applicable answers to management
problems.
Individuals:
-Each person is substantially different from all others in terms of their personalities, needs,
demographic factors and past experiences and/or because they are placed in different physical
settings, time periods or social surroundings. This diversity needs to be recognized and viewed as a
valuable asset to organizations. Individual performance forms the basis of organizational
performance. The four key influences on individual’s behaviour and motivation are:
a. Individual characteristics—e.g., personality, attitudes, perceptions, values.
b. Individual motivation—interacts with ability to work to determine individual performance.
c. Rewards/punishment—use of behaviour modification techniques to enhance performance and
control misbehaviour.
d. Stress.
Key Elements of Organisational Behaviour
Organisational behaviour models and theories consider four key elements:-
1. People:
They make up the organisation’s internal and social structure. People include the organisation’s
stakeholders (those impacted by its actions), workers, and groups.
2. Structure:
In an organisation, work is conducted according to a system of official and informal norms and
procedures. Also, it comprises hierarchies, communication networks, regulations, processes, and other
similar elements.
3. Technology:
It is the umbrella term for all the resources a company uses to accomplish its goals, including
machinery, software, tools, gadgets, and operational procedures.
4. Environment:
The social aspects that an organisation’s personnel are impacted by outside the organisation. Cultural,
economic, technical, political, and legal aspects are all included.

Models Of Organisational Behaviour

There are five different types of models in OB. We will throw some light on each of these five
models.

Autocratic Model
The root level of this model is power with a managerial orientation of authority. The employees in this
model are oriented towards obedience and discipline. They are dependent on their boss. The employee
requirement that is met is subsistence. The performance result is less.
The major drawbacks of this model are people are easily frustrated, insecurity, dependency on the
superiors, minimum performance because of minimum wage.
Custodial Model
The root level of this model is economic resources with a managerial orientation of money. The
employees in this model are oriented towards security and benefits provided to them. They are
dependent on the organization. The employee requirement that is met is security.
This model is adapted by firms having high resources as the name suggest. It is dependent on
economic resources. This approach directs to depend on firm rather than on manager or boss. They
give passive cooperation as they are satisfied but not strongly encouraged.
Supportive Model
The root level of this model is leadership with a managerial orientation of support. The employees in
this model are oriented towards their job performance and participation. The employee requirement
that is met is status and recognition. The performance result is awakened drives.
This model is dependent on leadership strive. It gives a climate to help employees grow and
accomplish the job in the interest of the organization. Management job is to assist the employee’s job
performance. Employees feel a sense of participation.
Collegial Model
The root level of this model is partnership with a managerial orientation of teamwork. The employees
in this model are oriented towards responsible behaviour and self-discipline. The employee
requirement that is met is self-actualization. The performance result is moderate zeal.
This is an extension of supportive model. The team work approach is adapted for this model. Self-
discipline is maintained. Workers feel an obligation to uphold quality standard for the better image of
the company. A sense of “accept” and “respect” is seen.
System Model
The system model discusses the organisational structure, culture, working environment, and
consistent policies.
It works to achieve a balance between the objectives of the individual and the organisation, assuming
that people have varying goals, abilities, and potential. Managers and staff members of the
organisation invest their interests to help and achieve established objectives. All staff members and
management should feel that they have a relationship with the organisation and agree on how to
accomplish shared objectives.
A positive workplace atmosphere, communication and collaboration, and value to employees and the
community are only a few advantages of the system model.
Application of OB in Management
1) Responding to Globalization
Organization in recent days has changed the style of working and tries to spread worldwide. Trapping
new market place, new technology or reducing cost through specialization or cheap labour are few of
the different reasons that motivates organizations to become global.
2) Managing Workforce Diversity
The increasing heterogeneity of organizations with the inclusion of different groups. Whereas
globalization focuses on differences among people from different countries. "Workforce diversity has
important implications for management practice. Managers will need to shift their philosophy from
treating everyone alike
to recognizing differences and responding to those differences in ways that will ensure employee
retention and greater productivity while, at the same time, not discriminating".
3) Improving Quality and Productivity
a) Total Quality Management (TQM)
It is a philosophy of management that is driven by the constant attainment of customer satisfaction
through the continuous improvement of all organizational processes.
1. Intense focus on the customer
2. Concern for continuous improvement
3. Improvement in the quality of everything the organization does
4. Accurate measurement
5. Empowerment of employees.
b) Reengineering
Reengineering: Reconsiders how work would be done and the organization structured if they were
being created from scratch. "It asks managers to reconsider how work would be done and their
organization structured if they were starting over".
4) Improving people skills
It will help management to better plan and respond to changes in the workplace. employee
relationship is also showing change in the modern era. Employer Employers are no more autocrats
and participative style of leadership welcomed. Flexible working hours and increased is authority
motivates employees to perform to their best. Management now welcomes upward communication
and participation of lower-level employees in the decision-making process.
5) Stimulating Innovation and Change
"Today's successful organizations must foster innovation and master the art of change or they'll
become candidates for extinction. An organization's employees can be the impetus for innovation and
change or they can be a major stumbling block. The challenge for managers is to stimulate employee
creativity and tolerance for change.
6) Work-life Balance
Achieving a work-life balance between work and other important aspects of life is a big challenge
today in every organization. It can be tough to make time for family and work. Hence, Employers can
help employees to achieve work-life balance by instituting policies, procedures, actions, and
expectations that enable them to pursue more balanced lives, such as flexible work schedules,
company sponsored family events and activities etc.
7) Improving People Skills
Possessing people skills is essential to have success in todays’ organizations. Employees needs to
improve their skills through a little effort and showing basic common courtesy in their business
dealings like being polite, avoiding conflict, listening, appreciating etc. On the other hand employers’
should also concentrate more on training employees with this above context.

Challenges and Opportunities of Organizational Behaviour

In today’s workplaces, managers are dealing with various behavioural problems and difficulties.
Dealing with challenges such as meeting changing employee expectations, addressing declining
loyalty, and managing a diverse workforce. Successfully navigating these issues requires adaptability,
effective communication, and creating an inclusive workplace culture.
There are several challenges and opportunities of organizational behaviour. Some of them are;
• Globalization
Globalization refers to the integration of economies, societies, and cultures on a global scale. It is
caused due to advancements in technology, communication, transportation, and trade, enabling the
flow of goods, services, capital, information, and ideas across national boundaries.

The challenges caused by globalization are organizations face intensified competition globally making
it harder to stand out and maintain market share. Globalization exposes organizations to economic
fluctuations in different countries and it also makes it difficult in managing diverse cultural contexts,
supply chains across multiple countries, international norms, values, and cultures, regulatory
framework, advancement of technology, etc.
Globalization allows organizations to access large no. of customers worldwide. It provides
opportunities for organizations to expand into new markets, have diverse talent, collaborate with
international partners, and benefit from economies of scale.

• Workforce Diversity
The term diversity refers to the differences among people. It includes employees having different
characteristics, such as gender, race, age, ethnicity, religion, culture, and abilities, working together in
a supportive and inclusive environment.
While managing the workforce conflicts may arise due to differences in cultural backgrounds,
perspectives, and communication styles. Diverse perspectives can lead to conflicts or disagreements
within teams. Organizations must ensure that diverse employees feel valued, included, and have equal
opportunities for growth.
Workforce diversity also provides opportunities like innovation and creative problem-solving, leading
to fresh ideas and competitive advantages. If it is not managed properly it can result in increased
interpersonal conflict and ineffective communication.

• Improving People Skills

Improving people skills refers to enhancing the abilities and qualities that enable individuals to
interact effectively with others.
As competition has grown and people have become more aware of the importance of quality, there is
a greater need for individuals to possess advanced skills and knowledge. For this providing training
and re-educating the less skilled employees may become a challenge for the manager.
A skilled employee who is fully trained, developed, and motivated can be a useful asset to the
organization. Improving people skills requires practice, self-reflection, and a genuine desire to
connect with others.

• Quality and Productivity

Quality and productivity influence the success of businesses and organizations across various
industries as they are interconnected and impact each other.
Maintaining the quality of the product and meeting the expectations of the consumer might be a
significant challenge for the manager. Due to globalization, Customers have high standards and
demand products or services that are defect-free, reliable, and of superior quality.
But increasing quality and productivity helps to acquire more customers even with fewer resources,
leading to increased efficiency and cost savings. It also helps in building a strong brand reputation and
leads to innovation and product development.

• Empowerment of Employees
Employee empowerment is the process of providing employees with the authority, autonomy,
resources, and support necessary to make the right decisions at the right time.
Managers are putting employees in charge of what they do as a result they have to learn how to take
responsibility for their work and make appropriate decisions. Empowering employees often involves
delegating decision-making authority and granting autonomy. But employees lacking the necessary
skills, knowledge, or experience may fear taking on additional responsibilities or uncertainties about
their new roles.
Empowered employees have the freedom to generate ideas, experiment, and take calculated risks.
When employees have a sense of empowerment, they feel valued, trusted, and motivated to contribute
to the organization’s success.
• Managing Organizational Change
The organizational environment is dynamic. So managers must be prepared to introduce
organizational change.
In today’s organization change is necessary to have progress. Many employees are still resistant to
change, they are more concerned about job security, new roles, and responsibilities, or a shift in the
organizational culture. Applying many different programs like the reorganization of departments,
disposal of poor-performing units, downsizing in the structure, and employee outsourcing might be a
significant challenge.
Along with challenges change also brings opportunities. The study of OB helps managers to
understand the continual change in a better way. They can learn new skills, expand their knowledge,
and adapt to changing market demands.
• Use of Technology
This is the era of technology. It has highly influenced the field of management and organizational
behaviour.
The use of technology is gradually increasing and with those challenges like maintaining the privacy
of the employees, information overload, high demand for training and learning, etc. Rapid
technological advancement also needs organizations to constantly adapt and upgrade their systems,
which can be costly and time-consuming.
But if the technology is used properly it can help to increase efficiency and productivity, saves time,
enhance customer experiences, and innovation, and there is competitive advantage for organizations.
Technology enables organizations to connect with customers and employees worldwide, enabling
remote work and expanding market reach. Embracing technology develops innovation, and provides a
competitive edge, empowering organizations to succeed in a globalized and interconnected business
area.

• Managing Temporary Employees

Due to globalization, competition among organizations is also increasing. For seasonal jobs,
occasional jobs, and less important jobs managers hire temporary employees to cut the cost and long-
term burden.
Long-term benefits like provident fund, pension, paid leave, bonus, etc are not available for temporary
employees so they might show low motivation and job satisfaction. Providing training and fitting
them into the organization’s culture might be a challenge for managers.
Hiring temporary employees can be more cost-effective. So managers need to keep them motivated by
providing rewards. As temporary employees can bring external expertise and knowledge from
different industries or companies, which can benefit the organization and its permanent staff.

• Improving Ethical Behaviour

Ethical behaviour is to behave according to the moral standards set by the society which we live in. It
is a belief regarding what is right and wrong or good and bad.
The main challenge for a manager is to maintain the rules and regulations acceptable to the
employees. If employees are not positively aligned with the guidelines, it is important for managers to
identify the causes and develop rules that benefit both employees’ ethics and the organization’s ethics.
Managers should offer seminars, workshops, and similar training programs to improve the ethical
behaviour of the employees as it helps to improve an individual’s or organization’s reputation.

• Improving Customer Service

Organizational behaviour contributes to improving organizational performance by examining the
relationship between employees’ attitudes and behaviour and customer satisfaction.
Customers today have high expectations so poor customer service may lead to complaints and
criticism which may be a challenge for managers. It is also essential to offer both sales and after-sales
service.
Excellent customer service leads to increased customer satisfaction and loyalty, enhances a company’s
reputation, and positively impacts its brand image. Organizational behaviour (OB) can enhance
organizational performance by demonstrating the link between employee attitudes and behaviours
with customer satisfaction.