Organizational Behavior

UNIT I
Fundamentals of OB: Evolution of management thought , functions of management, Definition, Scope
and Importance of OB, Relationship between OB and the individual, Evolution of OB, Models of OB
(Autocratic, Custodial, Supportive, Collegial & SOBC), Limitations of OB.

The OB is composed of TWO words

1 Organizational
2 Behavior
An Organization is consciously coordinated social unit
Behavior is reaction to a Stimulus

Introduction
Organizational behavior revolves around two fundamental components
1. The nature of the man.
2. The nature of the organization.

Fundamentals of OB
o Nature of people
o Individual differences –Nature vs. nurture
o Perception –The unique way in which each person sees, organizes and interprets things –
Selective perception cause misinterpretation
o A whole person –We employ the whole person not just their brains or skills
o Ergonomics is the science of fitting workplace conditions and job demands to the capabilities of
the working population
Definition
“Organizational behavior is directly concerned with the understanding, production and control of
human behavior in organizations.”
—Fred Luthans.
Features of OB
o A Separate Field of Study and not a Discipline Only.
o An Interdisciplinary Approach.
o Applied Science.
o A Normative Science.
o A Humanistic and Optimistic Approach.
o A Total System Approach.

Objectives of OB
1. Job Satisfaction
2. Finding the Right People
3. Organizational Culture
4. Leadership and Conflict Resolution
5. Understanding the Employees Better
6. Understand how to Develop Good Leaders
7. Develop a Good Team
8. Higher Productivity
Importance of Organizational Behavior
1. It builds better relationship by achieving people’s, organizational, and social objectives.
2. It covers a wide array of human resource like behavior, training and development, change
management, leadership, teams etc.
3. It brings coordination which is the essence of management.
4. It improves goodwill of the organization.
5. It helps to achieve objectives quickly.
6. It makes optimum utilization of resources.
7. It facilitates motivation.
8. It leads to higher efficiency.
9. It improves relations in the organization.
10. It is multidisciplinary, in the sense that applies different techniques, methods, and theories to
evaluate the performances.
Scope of OB
Individual Behavior
It is the study of individual’s personality, learning, attitudes, motivation, and job satisfaction. In this
study, we interact with others in order to study about them and make our perception about them.

Example − The personal interview round is conducted to interact with candidates to check their skills,
apart from those mentioned in the resume.

Inter-individual Behavior
It is the study conducted through communication between the employees among themselves as well
as their subordinates, understanding people’s leadership qualities, group dynamics, group conflicts,
power and politics.
Example − A meeting to decide list of new board members.

Group Behavior
Group behavior studies the formation of organization, structure of organization and effectiveness of
organization. The group efforts made towards the achievement of organization’s goal is group
behavior. In short, it is the way how a group behaves.
Example − Strike, rally etc.

Functions of Management
Evolution of management thought
4 stages of Evolution of management thought
1. Pre-scientific management period.
2. Classical Theory
a. Scientific Management of Taylor
b. Administrative Management of Fayol
c. Bureaucratic Model of Max Weber
3. Neo-classical Theory or Behaviour Approach
4. Modern Theory or Systems Approach

Evolution of Management Thought

Relationship between OB and the individual

For organization to grow continuously there is need individual growing, this creates a sense of
responsibility and create relation between organization and individual.

Following things can enhance the relationship between OB and Individual:

1. Continuous Learning
2. Create Right Perception
3. Building Positive Attitude and Values
4. Having Personality and Emotions Compatible at workplace
5. Maintain Stress-Free Individuals and Environment
6. Keeping Individual and Team Motivated and Providing Job Satisfaction
Evolution of OB

1. Robert Owen: (1800) Young Factory Owner-First to emphasize the human needs of employees
and refused to employ children Taught workers to improve working conditions Father of
personnel management Andrew Ure-(1935) The Philosophy of Manufacturers -1835 Value of
human factor in manufacturing Provided welfare facilities to workers J.N. TATA in 1886
Instituted a pension fund & 1895 began to pay accident compensation.

2. William Gilbreth: (1914) “The Psychology of Management F.W.Taylor-(1916) Father of Scientific

Management Time & Motion Study Piece Rate Method

3. Henry Fayol: (1916) Administrative Management , Principle of Governing Behavior,

Management Quality Elton Mayo-(1920’s & 1930’s) Human behavior at Harvard University
Hawthorne's Experiments/Plant Abraham H. Maslow (1954): Need Hierarchy Motivation model
Douglas McGregor (1960): Theory X and Theory Y Managerial Style Henry Mintzberg (1960) :
Managerial Roles : Interpersonal, Informational and Decision making

4. Peter Drucker (1909 -2005) Father of modern management Importance of change How to bring
best out of people Innovation Entrepreneurship.

NOTE: Hawthorne Effect

 Illumination Experiment
 Relay Assembly Test Room Experiment
 Interviewing Programme
 Bank Wiring Test Room Experiment

Models of OB
1 Traditional Models
•Feudalism
•Slavery
2 Modern Models
 Autocratic
 Custodial
 Supportive
 Collegial
 SOBC

Autocratic Model
Basis of Model is the Power of the Boss, environment is authority oriented, and the employee’s
orientation is obedience to the boss, suitable when workers are actually lazy, performance result is
minimum.
Custodial Model

This model was developed to improve the employer-employee relations. The model emphasizes on
economic rewards and benefits, model brings security and satisfaction to the employees.

Supportive Model

This model helps in creating friendly superior-subordinate interaction with a high degree of confidence
and trust. Model takes care of the psychological, subsistence and security needs of the employees.

Collegial Model

This model creates a favorable climate, based upon the partnership between employees and the
management, workers have job satisfaction, job involvement, job commitment and some degree of
fulfillment. Suitable in research laboratories/projects.

S O B C Model

S à Stimulus O à Organism
B à Behaviour C à Consequence

S-O-B-C is a model which helps to understand, predict and control O.B. on the basis of managing the
contingent (conditional) environment.

Limitations of OB

1. Behavioral bias: It further causes dependence, dis-contentment, indiscipline, and

irresponsibility.
2. Law of diminishing returns: It says that beyond a certain point, there is a decline in output even
after each additional good or positive factor.
3. Unethical practices and manipulation of people: Knowledge of motivation and communication
acquired can be used to exploit subordinates in an Organization by the manipulative managers.
Organizational Behavioral Models:

Models are the techniques which help us to understand complex things and ideas in a clear
manner.

Models are frameworks or possible explanations why do people behave as they do at work.
There are so many models as many are organizations. Varying results across the organizations
are substantially caused by differences in the models of organizational behaviour. All the models
of organizational behaviour are broadly classified into four types: autocratic, custodial,
supportive and collegial. We discuss these four models beginning with the autocratic. O.B. is
the study of human behaviour in organizations, the interface between human behaviour and the
organization and the organization itself.

1. The Autocratic Model

The basis of this model is power with a managerial orientation of authority. The employees in
turn are oriented towards obedience and dependence on the boss. The employee need that is met
is subsistence. The performance result is minimal.

In case of an autocratic model, the managerial orientation is doctorial. The managers exercise
their commands over employees. The managers give orders and the employees have to obey the
orders. Thus, the employees orientation towards the managers/bosses is obedience. Under
autocratic conditions, employees give higher performance either because of their achievement
drive or their personal liking to the boss or because of some other factor.

Evidences such as the industrial civilization of the United States and organizational crises do
suggest that the autocratic model produced results. However, its principal weakness is its high
human cost. The combination of emerging knowledge about the needs of the employees and
ever changing societal values and norms suggested managers to adopt alternative and better
ways to manage people at work. This gave genesis to the second type of models or
organizational behaviour.
 2. The Custodial Model

The basis of this model is economic resources with a managerial orientation of money. The
employees in turn are oriented towards security and benefits and dependence on the
organization. The employee need that is met is security. The performance result is passive
cooperation.

While studying the employees, the managers realized and recognized that although the
employees managed under autocratic style do not talk back to their boss they certainly think
back about the system. Such employees filled with frustration and aggression vent them on their
co-workers, families and neighbors. This made the managers think how to develop better
employee satisfaction and security. It was realized that this can be done by dispelling employees'
insecurities, frustration and aggression. This called for introduction of welfare programmers to
satisfy security needs of employees. Provision for an on site day-care centre for quality child
care is an example of welfare programme meant for employees. Welfare programmes lead to
employee dependence on the organization. Stating more accurately, employees having
dependence on organization may not afford to quit even there seem greener pastures around.
The welfare programmes for employees started by the Indira Gandhi National Open University
(IGNOU), New Delhi are worth citing in this context, IGNOU, in the beginning provided its
employees facilities like house-lease facility, subsidized transport facility, day-time child care
centre in the campus, etc. These made employees dependent on IGNOU which, in turn, became
custodian of its employees.

The basis of this model is partnership with a managerial orientation of teamwork. The
employees in turn are oriented towards responsible behavior and self-discipline.

Although the custodian approach brings security and satisfaction, it suffers from certain flaws
also. Employees produce anywhere near their capacities. They are also not motivated to increase
their capacities of which they are capable. Though the employees are satisfied, still they do not
feel motivated or fulfilled in their work they do. This is in conformity with the research finding
that the happy employees are not necessarily most productive employees. Consequently
managers and researchers started to address yet another question. "Is there better approach/way
to manage people?" The quest for a better way provided a foundation for evolvement to the
supportive type of model of organizational behaviour.

3. The Supportive Model

The basis of this model is leadership with a managerial orientation of support. The employees in
turn are oriented towards job performance and participation. The employee need that is met is
status and recognition. The performance result is awakened drives.

The supportive model is founded on leadership, not on money or authority. In fact, it is the
managerial leadership style that provides an atmosphere to help employees grow and accomplish
their tasks successfully. The managers recognize that the workers are not by nature passive and
disinterested to organizational needs, but they are made so by an inappropriate leadership style.
The managers believe that given due and appropriate changes, the workers become ready to
share responsibility, develop a drive to contribute their mite and improve themselves. Thus,
under supportive approach, the management's orientation is to support the employee's job
performance for meeting both organizational and individual goals.

However, the supportive model of organizational behaviour is found more useful and effective
in developed nations and less effective in developing nations like ours because of employee's
more awakening in the former and less one in the latter nations.

4. The Collegial Model

The collegial model is an extension of the supportive model. As the literal meaning of the work
'college' means a group of persons having the common purpose, the collegial model relates to a
team work/concept. The basic foundation of the collegial model lies on management's building a
feeling of partnership with employee. Under collegial approach, employees feel needed and
useful. They consider managers as joint contributors to organizational success rather than as
bosses.

Its greatest benefit is that the employee becomes self-discipline. Feeling responsible backed by
self-discipline creates a feeling of team work just like what the members of a football team feel.
The research studies report that compared to traditional management model, the more open,
participative, collegial managerial approach produced improved results in situations where it is
appropriate.

Although there are four separate models, almost no organization operates exclusively in one.
There will usually be a predominate one, with one or more areas overlapping in the other
models.

The first model, autocratic, had its roots in the industrial revolution. The managers of this type
of organization operate out of McGregor's Theory X. The next three models begin to build on
McGregor's Theory Y. They have each evolved over a period of time and there is no one "best"
model. The collegial model should not be thought as the last or best model, but the beginning of
a new model or paradigm.

Now, the sum and substances of these four models of organizational behaviour are summarized
in Table 1.1.

Interpretation of Different Models: Various conclusions may be drawn from the study of

different models as follows :

(i) As soon as the understanding of human behaviour develops or social conditions change, the
model is bound to change. No one model is best for all times.

(ii) Models or organizational behaviour are related to hierarchy of human needs. As society
advances on the need hierarchy, new models are developed to serve the higher order needs
that is paramount at that time.

(iii) Present tendency towards more democratic models of organizational behaviour will
continue to develop for long run.

(iv) Different models will remain in use though new model predominates as most appropriate
for general use at any given time as task conditions differ from time to time and organization to
organization.
 Table 1.1 : Four Models of Organizational Behaviour

5. SOBC MODEL:

 S-O-B-C stands for Stimulus, Organism (a person), Behavior and Consequence.

 Stimulus: is any event that happens in the environment, it can be a sound(like someone
shouting) a scene(a car accident, a fight. etc...), events(like receiving a paycheck).
 Organism: is a person, nothing more can be said about this, so in OB you can consider
that to be an employee or an employer.
 Behavior: the organism behavior and response in regards to the stimulus( for example a
child(Organism) may hit(Behavior) his brother after seeing a violent movie(Stimulus).
 Consequence: (Covert and Overt) is the the outcome that comes after the behavior, it
either reinforces (thus repeated) the behavior or punished (thus not repeated). In the child
example previously mentioned, his mother can reprimand (Consequence: punishment) him for
doing what he did.
Limitations of OB: