1. Introduction to Behavioral Management

2. Behavioral management focuses on individual attitudes, behaviors and group processes, and it recognizes the importance of behavioral process in the workplace. The behavioral management perspective was stimulated by a number of writers and theoretical movements.

3. One of movements towards behavioral management had been the industrial psychology, the practice of applying psychological concepts to industrial settings. HUGO MUNSTERBERG (1863-1916) :- A noted German psychologist, is recognized as the father of industrial psychology.

4. Another early advocate of the behavioral approach to management was Mary Parker Follett (1868-1933) Mary Parker Follett was called as the ‘Prophet of Management’ by Peter Drucker. ‘The study of human relations in business and the study of the technology of operating are bound up together’ – Follett

6. In the 1920s Elton Mayo, a professor of Industrial Management at Harvard Business School, and his protégé Fritz J. Roethlisberger led a landmark study of worker behavior at Western Electric, the manufacturing arm of AT&T. Unprecedented in scale and scope, the nine-year study took place at the massive Hawthorne Works plant outside of Chicago and generated a mountain of documents, from hourly performance charts to interviews with thousands of employees. Harvard Business School’s role in the experiments represented a milestone in the dawn of the human relations movement and a shift in the study of management from a scientific to a multi- disciplinary approach.

9. * The Hawthorne studies were conducted in order to find out the role of human resource in increasing the production of an organization. * The studies were also to see if individuals improve an aspect of their behavior in response to their awareness of being observed.

10. Took place from 1924-1927 Was funded by General Electric Conducted by The National Research Council (NRC) of the National Academy of Sciences with engineers from MIT Measured Light Intensity vs. Worker Output Result : – Higher worker productivity and satisfaction at all light levels – Worker productivity was stopped with the light levels reached moonlight intensity. Conclusions: – Light intensity has no conclusive effect on output – Productivity has a psychological component Concept of “Hawthorne Effect” was created

13. Conducted 20,000 interviews. Objective was to explore information, which could be used to improve supervisory training. Initially used the method of Direct Questioning and changed to Non Directive. Results - Merely giving an opportunity to talk and express grievances would increase the morale. - Complaints were symptoms of deep-rooted disturbances. -Workers are governed by experience obtained from both inside and outside the company.

14. The worker was satisfied/dissatisfied depending upon how he regarded his social status in the company. -Social groups created big impact on work. -Production was restricted by workers regardless all financial incentives offered as group pressure are on individual workers.

17. Organizations have different departments, values, desires, ideas, and personalities that make each one of them unique. We need to understand that while companies are different, the individuals within a specific company are different from each other as well. They are unique and have their own views of the world and business. It is the overall goal of the company to embrace that uniqueness yet still have their employees identify with how the company views doing business. As the people in the company share the values of the organization, the company begins to get closer and starts working more like one big team as opposed to different departments staffed by different individuals. Organizational behavior acknowledges that human behavior is much more complex than the human raltaionists realized. The field of organizational behavior draws from a board interdisciplinary base of psychology, sociology, anthropology, economics and medicine. The two functions of management leading and organizing is heavily influenced by this. Management style is strongly influenced by one's beliefs and assumptions about what motivates members of the team. If you believe that team members dislike work, you will tend towards an authoritarian style of management; On the other hand, if you assume that employees take pride in doing a good job, you will tend to adopt a more participative style.

19. Theory X assumes that employees are naturally unmotivated and dislike working, and this encourages an authoritarian style of management. According to this view, management must actively intervene to get things done. This style of management assumes that workers: Dislike working. Avoid responsibility and need to be directed. Have to be controlled, forced, and threatened to deliver what's needed. Need to be supervised at every step, with controls put in place. Need to be enticed to produce results; otherwise they have no ambition or incentive to work. X-Type organizations tend to be top heavy, with managers and supervisors required at every step to control workers. There is little delegation of authority and control remains firmly centralized. McGregor recognized that X-Type workers are in fact usually the minority, and yet in mass organizations, such as large scale production environment, X Theory management may be required and can be unavoidable.

20. Theory Y expounds a participative style of management that is de-centralized. It assumes that employees are happy to work, are self-motivated and creative, and enjoy working with greater responsibility. It assumes that workers: Take responsibility and are motivated to fulfill the goals they are given. Seek and accept responsibility and do not need much direction. Consider work as a natural part of life and solve work problems imaginatively. This more participative management style tends to be more widely applicable. In Y-Type organizations, people at lower levels of the organization are involved in decision making and have more responsibility.

21. Motivation: Theory X assumes that people dislike work; they want to avoid it and do not want to take responsibility. Theory Y assumes that people are self-motivated, and thrive on responsibility. Management Style and Control: In a Theory X organization, management is authoritarian, and centralized control is retained, whilst in Theory Y, the management style is participative: Management involves employees in decision making, but retains power to implement decisions. Work Organization: Theory X employees tend to have specialized and often repetitive work. In Theory Y, the work tends to be organized around wider areas of skill or knowledge; Employees are also encouraged to develop expertise and make suggestions and improvements.

22. Rewards and Appraisals: Theory X organizations work on a ‘carrot and stick’ basis, and performance appraisal is part of the overall mechanisms of control and remuneration. In Theory Y organizations, appraisal is also regular and important, but is usually a separate mechanism from organizational controls. Theory Y organizations also give employees frequent opportunities for promotion. Application: Although Theory X management style is widely accepted as inferior to others, it has its place in large scale production operation and unskilled production-line work. Many of the principles of Theory Y are widely adopted by types of organization that value and encourage participation. Theory Y-style management is suited to knowledge work and professional services. Professional service organizations naturally evolve Theory Y-type practices by the nature of their work; Even highly structure knowledge work, such as call center operations, can benefits from its principles to encourage knowledge sharing and continuous improvement.

23. Behavioral Management is widely practiced today in top companies to help increase employee morale and productivity. This style of management is implemented through various means such as child daycare, flextime, employee chat rooms, positive reinforcement and various other methods. In the following slides we will take a closer look at these methods.

24. Companies that offer daycare for children of employees engage in behavioral management. The idea is that if employees know their children are nearby and are well cared for, work can proceed with fewer distractions. This is an example of trusting that the employee wants to work and giving the employee a work environment that doesn't pit the job against family life. Providing daycare is a behavioral approach to getting the most out of employees, because it focuses on employee satisfaction. Google, which topped Fortune’s Best Companies to work for list, has four child care centers on-campus specifically for its employees.

25. Allowing employees to choose flexible schedules is a way of trying to respect individual needs and improve job satisfaction by concentrating on providing an accommodating workplace. This can help a company retain employees and gain a reputation as a good place to work. Such a reputation may attract top talent. Employees can choose their hours as long as they work a set number of hours per week. Flexible scheduling can even expand to allow employees to work from home several days a week. Best Buy Co. and PricewaterhouseCoopers are just two companies among several which offers flexible work hours to its employees.

26. This electronic version of the suggestion box can give employees the sense that their ideas have value to the company. Empowering employees to make suggestions and create initiatives is a behavioral approach because it helps employees enjoy their jobs and raise their self-esteem. Management can monitor chat rooms and even join the conversation to encourage exploration of ideas. When enough people get behind a suggestion, management can meet with a delegation to discuss the possibilities.

27. The behavioral approach lends itself to positive reinforcement as a way to increase productivity. Managers who use this style look for employees who are doing things right rather than employees who are doing things wrong. By pointing out the beneficial behavior and even rewarding it, the manager sends the signal that such behavior can help employees get ahead in the workplace. As a side benefit, using positive reinforcement requires a manager to spend time among the workforce to observe. This promotes increased familiarity and has the potential to promote positive relations between employees and managers.

28. Provided important insights into motivation, group dynamics and other interpersonal processes in organizations. Focused managerial attention on these same processes Challenged the view that employees are tools and furthered the belief that employees are valuable resources

29. The complexity of individual behavior makes prediction of that behavior difficult. It is not always easy to know if Theory X or Theory Y should be applied. Many behavioral concepts have not yet been put to use because some managers are reluctant to adopt them. Contemporary research findings by behavioral scientists are often not communicated to practicing managers in an understandable form.