CHAPTER 1

An Overview of
Human Behavior in
Organization
Content
 What is Human Behavior
 What is Organizational Behavior
 The Benefits of Studying
Organizationa Behavior (OB)
 A Brief History of Organizational
Behavior
 Ethics and Organizational Behavior
 Learning Objectives
After studying this chapter you should be able to: -

 Historical evolution of OB as a discipline

 Goals, benefits and elements of OB
 Contributing disciplines to the OB field
 Define organizational behavior.
 Identify the functions that comprise the management process
and relate them to organizational behavior.
 Relate organizational behavior to basic managerial roles and
skills.
 Describe contemporary organizational behavior.
 Discuss contextual perspectives on organizational behavior.
4 Organizational Behavior
What is
Human
Behavior?
Human Behavior

Refers to the physical actions of a person

that can be seen or heard.

With his thoughts, feelings, emotions, and

sentiments, the person exhibits behaviors.

Human behavior in organizations is more

appropriately referred to as organizational
behavior (OB)
Video
HUMAN BEHAVIOR
Human behavior is shaped by psychological traits, as
personality types vary from person to person, producing
different actions and behavior. Extraverted people, for
instance, are more likely than introverted people to
participate in social activities like parties.
What's Your Personality
Type?
What is Organizational
Behavior or (OB)?

Defined as the study of

human behavior in
organization, of the
interaction between
individuals and the
organization, and of the
organization itself.
 Organizations need to develop their interpersonal or people
skills for being effective.
 Organizational behavior is a field of study that investigates the
impact that individuals, groups, and structure have on behavior
within an organization, then applies that knowledge to make
organizations work more effectively.
Robbins (2003)
 OB concentrates on how to
 Improve productivity
 Reduce absenteeism and turnover
 Increase employee citizenship
 Increase employee job satisfaction

11 Organizational Behavior
  Some basic ideas included in OB are personality theory,
attitudes and values, motivation and learning,
interpersonal behavior, group dynamics, leadership and
teamwork, organizational structure and design, decision-
making, power, conflict and negotiation.

12 Organizational Behavior
 Organizations are defined as social
arrangements, constructed by people,
who can also change them.
Buchanan and Huczynski (1997)

Organizations are a system of

cooperative activities - and their
coordination requires something
Definitions intangible and personal that is largely a
of OB matter of personal relationships.
---- Barnard (1938)
OB is concerned with “the study of the
structure, functioning and performance
of organizations, and the behavior of
groups and individuals within them”.
---- Pugh (1971)

Organizational Behavior 13
 OB is about----

“the study of human behavior, attitudes and performance within an

organizational setting;
drawing on theory, methods and principles from such disciplines---

as psychology, sociology, and cultural anthropology to learn about

individual perception, values, learning capabilities, and actions
while working with groups and within the total organization;

analyzing the external environment’s effect on the organization

and its human resources, missions, objectives and strategies.”

Organizational behavior is defines as “The understanding, prediction

and management of human behavior in organizations.”
Fred Luthans

14 Organizational Behavior
Contd.

• From the above definitions, OB can be

seen as----
•A way of thinking
•An interdisciplinary field
•Having a distinctly humanistic
outlook
•Performance oriented
•Seeing the external environment
as critical
•Using scientific method
•Having an application orientation
Organizational Behavior 15
Human Behavior:
What benefits may be derived
from studying Organization
Behavior?
  The Four Goals of OB are
as follows:
The
Goals 1. To Describe
of OB 2. To explain/understand
behavior
3. To predict behavior, and
4. To control behavior
 Elements of OB:
The Four
Element
s of OB
1. People
2.Structure
3.Technology
4.Environment
People/ Employee

The internal social system of the

organization is composed of
people consisting of individual
persons and groups.

The individual person is

inducted as a member of a
formal group, but soon, he or
she may become a member of
an informal group

THE FOUR ELEMENTS OF OB

 Defines the formal
Structur relationship of
e people in the
organization.

It describes how
job tasks are
formally divided,
grouped and
coordinated
Technology

 Refers to the combination

of resources, knowledge,
and techniques with which
people work and affects the
task that they perform

 It consists of buildings,
machines, work processes,
and assembled resources
Environment

 Refers to institutions or forces

outside the organization that
potentially affects the
organization’s performance.
 It includes supplies, customers,
competitors, government
regulatory agencies, public
pressure groups, and the like.
 The benefits of Studying
Organizational Behavior (OB)

 The study of OB offers certain

benefits. They are as follows:

1.Development of people skills

2.Personal growth
3.Enhancement of organizational and
individual effectiveness
4.Sharpening and refinement of
common sense
 Development of People Skills

There are two types of skills that a person will

need to succeed in his chosen career:

1. the skill in doing his work; and

2. the skill in relating with people

The benefits of Studying Organizational Behavior (OB)

What is
important???

Work skills or
Interpersonal skills
 Personal Growth
 Personal growth makes a person
highly competitive in the workplace.
 The chance to achieve personal
growth is enhanced by knowledge of
OB
 For instance, knowledge of the
behavior of others through the
study of OB will help the person
understand his own behavior
 A person who strives to know
himself better is entering the realm
of intrapersonal intelligence, which
is a very useful type of intelligence
The benefits of Studying Organizational Behavior (OB)
for one who wants to achieve his
 Enhancement of Organizational
and Individual Effectiveness

Effectiveness is a major attribute of successful

organizations, as well as individuals.

When the right decisions are made,

effectiveness follows.

In decision-making, knowledge of OB can be

very useful.

Such errors could be avoided if the one

authorized to decide on work assignment have
knowledge of OB

The benefits of Studying Organizational Behavior (OB)

 Sharpening and
Refinement of Common
Sense

 People differ in the degree of common sense

they possess.
 Improvement in this type of ability, however,
can still be made and great benefits can be
derived if this is done
 For instance, common sense dictates that
persons working in hot and humid places cannot
perform well. Common sense, however, cannot
easily provide information o the exact
temperature that will make them work at
optimum levels. In those types of concerns,
knowledge of OB may be very useful
The benefits of Studying Organizational Behavior (OB)
video
video
 Early Theorists
 1. Adam Smith’s contribution
 In the Wealth of Nations
published in 1776, Adam Smith
stated that organizations and
society would benefit if they
practice division of labor.
 Division of labor increased
34
productivity by improving
workers’ skills and expertise
and by saving time.
 Smith argued that the division
of labor – based on concepts of
task differentiation and
specialization - creates
economic efficiency and leads to
increases of productive powers
Organizational Behavior

of labor.
 B) The Classical Era
Classical era covers the period from
1900 to mid 1930s.
The main contributors during this period
were
Frederick Taylor
Henri Fayol
Max Weber
Mary Parker Follet
Chester Barnard

35 Organizational Behavior
 1.Frederick Taylor
36
Taylor published "The Principles of
Scientific Management." In this,
he proposed that by optimizing
and simplifying jobs, productivity
would increase. He also advanced
the idea that workers and
managers needed to cooperate
with one another.
His main focus was on
finding the best way of
doing a job.
He gave importance to
selecting the right people
for the right job and train
them to do the job in the
best way.
Organizational Behavior
37 2.Henri Fayol

 He was a mining
engineer and a
manager by profession.

 He defined the nature

and working patterns
of twentieth century
organizations in his
book, General and
Industrial
Management,
published in 1916.
Organizational Behavior
 2.Henri Fayol
38
 In this book 14 principles of
management are defined. They
are----
 Division of work – Tasks should
be divided among employees.
 Authority and responsibility –
Authority is the right to give
orders. It should match with
responsibility.
 Discipline – It is necessary for
proper functioning of business.
 Unity of command – An
employee should receive
orders from one superior only.
 Unity of direction – Activities
related to a single objective
Organizational Behavior

should be coordinated by a
 6. Subordinates of individual interest to general interest –
Individual or group goals must not take priority over business
goals.
7. Remuneration of personnel – It should be fair, encourage
effort and there should be no overpayment.
8. Centralization – The extent of centralization of power of
issuing orders at the top depends on size of the organization
and the skills of its personnel.
9. Scalar chain (line of authority) – Flow of communication
should be up and down the line of authority.
10. Order – Material and personnel should be at proper place.
11. Equity – People should be treated with kindness and justice.
12. Stability of tenure of personnel – Quick turnover of people
should be avoided because it takes time to develop expertise.
13. Initiative – Employees should be encouraged to take
initiatives.
14. Esprit de corps – All efforts should be made to maintain peace
and harmony within the organization.

39 Organizational Behavior
 3.Max Weber

 His theory is also known as bureaucratic theory in

management.
 He described an ideal kind of organization and called it
bureaucracy.
The features of Weber’s bureaucratic structure are-------
 Areas of authority should be clearly specified.
 Organizations follow principle of hierarchy where subordinates
follow instructions of superiors but have a right to appeal.
 Abstract rules guide decisions and actions.
 Officials are selected on the basis of technical qualifications.
 Employment by the organization is a career.

40 Organizational Behavior
The Human
Relations
Movement
 1. Mary Parker Follet------

43
 The view that people are
important to the world of
business was given by
Mary Parker Follet. With
this the concept of human
relations movement
started.
 Follet believed that
organizations should be
based on collectivism
(group ethics) rather than
individualism.
 The manager’s task was to
Organizational Behavior
coordinate group efforts.
 2. Chester Barnard 45

 Barnard believed that

organizations consist of people
who have interacting social
relationships.
 He believed that organizations
can be successful if they
cooperate with various
stakeholders such as employees,
customers, investors, suppliers,
etc.
 He emphasized on the need for
development of skills and
Organizational Behavior

motivation of employees for the

 3. Elton Mayo

 He is known as the founder of human relations movement.

 He is also known for his research including the Hawthorne
Studies and his book ‘The Social Problems of an
Industrialized Civilization (1933)’.
 The research conducted under the Hawthorne Studies
showed the importance of groups in affecting the behavior
of individuals at work.
 He found that work satisfaction depended on the social
relationship of the workgroup.
 Physical conditions and financial incentives have very low
motivational value.
 He concluded that performance depends on both social
issues and job content.
47 Organizational Behavior
 4. Abraham
48
Maslow
 He proposed the need hierarchy
theory (physiological, safety,
social, esteem and self
actualization needs).
 Each step in the hierarchy must
be satisfied before moving on to
the next step.
 After a need is satisfied, it does
not motivate an individual.
 The final goal of human
existence is self actualization.
 Managers who accepted this
theory tried to change
organization and management
practices to reduce hurdles that
Organizational Behavior

prevent employees from

Does a pyramid of needs often
represent Abraham Maslow's
hierarchy of needs?

TRUE OR FALSE?
 TRUE!
Maslow's hierarchy of needs is often displayed
as a pyramid.
The lowest levels of the pyramid of needs are
made up of the most basic needs while the
most complex needs are at the top.
Maslow’s
Hierarchy Self Be where you want to be
of Needs
Need for respect from others
Esteem

Need to be in a group, be loved

Social

Need for stability and consistency

Safety

Basic needs like food, water

Physiological
 6. Douglas McGregor
* He gave two statements about human nature – Theory
X and Theory Y.
 Theory X put forward a negative view of people
stating that this category has
 Little ambition, Dislike work, Want to avoid responsibility
, Need close supervision at work
 Theory Y put forward a positive view of people stating
that this category has
 Self direction, Take responsibility, Consider work as a natural
activity
 McGregor believed that managers should give
freedom to their subordinates to utilize their
creativity and potential.
rWork is inherently distasteful to most people, and
they will attempt to avoid work whenever possible.
Most people are not ambitious, have little desire for
52 responsibility, and prefer to be directed.
 D) Behavioral Science
Theorists
1. B.F. Skinner-
 His research on classical and operant
conditioning and behavior modification
affected the design of organization’s training
programs and reward systems.
 According to Skinner, behavior depends on
results.
 He stated that people show a desired behavior
only if they are rewarded for it.
 A behavior is not repeated if an individual is
not rewarded or punished for it.
53 Organizational Behavior
 2.David McClelland
 His work has helped organizations to match people with jobs
and in redesigning jobs for high achievers to motivate them.
is best known for his work on motivation and his
development of the Need Theory, which
identifies three primary needs that influence
human behavior in organizational settings: the
need for achievement, the need for affiliation,
and the need for power.

 For example, people who have received achievement training

in India, work for longer hours, initiate more new business
ventures, make greater investments in productive assets as
compared to people who did not receive such training.
54 Organizational Behavior
1.Need for Achievement:

Employees with a high need for

achievement are often driven by
personal success and the desire to
excel.

2. Need for Affiliation: Those with a

strong need for affiliation prioritize
relationships and social interactions.
3. Need for Power: Employees
motivated by the need for power
seek to influence others and control
their environment.

A project leader who takes charge of

decision-making processes and
seeks to guide their team towards a
common goal exemplifies this need.
This can be beneficial in driving
initiatives forward but may require
balance to avoid authoritarianism.
 3.Fred Fiedler
 His work in the field of leadership has a big
contribution to the growth of OB as a discipline.

is He highlighted the situational aspects of

leadership and tried to develop a complete
theory of leadership behavior.

57 Organizational Behavior
1) Do you consider
yourself to be an
ethical person?
2) Should poor people be
punished for stealing if
they are stealing to feed
their family?
 3) If you saw a
pickpocket stealing
someone’s wallet
what would you do?
 4) If you could save
people by killing one
person, would you?
5) Would you risk
your life to save
another person?
 What is Ethics
- refers to the set of moral choices a
person makes based on what he or she
ought to do.

- ethics, also called moral philosophy, the

discipline concerned with what is morally good and
bad and morally right and wrong. The term is also
applied to any system or theory of moral values or
principles.
For individuals, the role of ethics in
organizational behavior helps ensure
that each person is treated fairly and
maintains personal responsibility.
- These are moral principles that
define right or wrong behavior in
organizations
 Organizational ethics is a form of
applied or professional ethics that
scrutinizes ethical morals, values
and principles that arise in a
workplace..
 Organizational Ethics

The way an organization should respond to

external environment refers to
organization ethics.
Organization ethics includes various
guidelines and principles which decide the
way individuals should behave at the
workplace.
It also refers to the code of conduct of the
individuals working in a particular
organization.
An ethical organization can achieve
better business results.

Organizations indulging in unethical

business practices or even in unethical
dealings with their employees are now
quickly identified and globally exposed
in this era of technology intensive
communication systems.
This refers to behavior that is
accepted as morally “good” and
“right” as opposed to “bad” and
“wrong”
There are important ethical
issues that confront
organizations. They consist of
the following:

1) Conflict of Interest
2) Fairness and honesty
3) Communication
4) Relationships within the
organization
Conflict of interest exist when a person is in the
position of having to decide whether to advance
the interests of the organization or to operate in
his or her own personal interests.
A conflict of interest (COI) is a situation in which
a person or organization is involved in multiple
interests, financial or otherwise, and serving one
interest could involve working against another.
Conflict of interest is a punishable
crime under Republic Act 6713,
Fairness
and
honesty
Honesty and
Fairness. Simply
put, honesty
means being
truthful with
ourselves and
with others
People in organization are expected to be
fair and honest.

Ethical behavior demands that, beyond

obeying law, they should not knowingly
harm customers, clients, and competitors
through deception, coercion or
misrepresentation.
Fairness and
honesty are
at the heart of
business ethics
and relate to
the general
values of
decision
makers
Why there should be ethics in
communication?
Ethics in the communications field
is important because if the public
views someone as not
trustworthy, it can compromise
a professions reputation. A
satisfying life also develops as a
result of developing trusting and
caring relationships with others
and that comes from making
ethical choices.
Communication Ethics is how a
person uses language,
media, journalism, and
creates relationships that
are guided by an
individual's moral and
values.
Relationship within the
organization
Relationship influe
nces behavior at
work place.
People interact
with each other
formally,
informally, officially
and socially that
may leads to love,
hate, respect,
disrespect, fear,
insecurity, anxiety
among each other.
Ethical customer relationships
should include honesty with
customers, delivering a good
product or service and backing
the product or service. A
company policy that encourages
positive relationships with
customers can help position your
company as a trusted one.
Ethical
relationships have
room for
forgiveness,
when those who
have failed or
erred not only
regret what
they've done,
but make
amends to those
they've hurt.
Is Behavior
affects morality?
TRUE OR FALSE
WHAT IS YOUR
LEARNINGS?