Introduction to Organizational Behavior

Introduction to Organizational Behavior
Chapter 1 Introduction to Organizational Behavior

Introduction Organizations are much more than only a means for providing goods and service They create the settings in which most of us spend our lives They have profound influence on employee behavior

The core 21st century qualities needed to create the ideal work atmosphere begin with intelligence, passion, a strong work ethic, and a genuine concern for people.

Managing and Working Today and in the Future:
Managers must become agile and flexible to help their firms develop and sustain competitive advantage To be successful, managers will need to harness the powers of: information technology human capital

Environmental Forces Reshaping Management Practice
Rapidity of Change New Worker- Employer Psychological Contract Technology Globalism Cultural Diversity Power of Human Resources Break-even Analysis identifies profit or loss at various sales volumes Return on Investment measures productivity of assets Marginal Analysis compares the additional cost in a particular decision rather than average cost Game Theory mathematical models that analyze multi-party decision contexts Linear Programming for optimally solving resource allocation problems Queuing Theory for calculating waiting lines 5

Challenges of These Forces to Managers
Resisting the reality of these forces will likely lead to: Unnecessary conflict Reduced managerial performance Reduced non-managerial performance Lost opportunities Failing to cope and deal with these forces will likely result in: Job dissatisfaction Poor morale Reduced commitment Lower work quality Burnout Poor judgment Unhealthy consequences

The Origins of Management
Frederic W. Taylor’s Scientific Management Principles Henri Fayol’s Functions of Management

Taylor’s Scientific Management Principles (1 of 2)
Develop a science for each element of an employee’s work which replaces the old rule-of-thumb method Scientifically select and then train, teach, and develop the worker whereas in the past a worker chose the work to do and was self-trained

Taylor’s Scientific Management Principles (2 of 2)
Heartily cooperate with each other to insure that all work was done in accordance with the principles of science There is an almost equal division of the work and the responsibility between management and non-managers

Impact of Fayol’s Functions of Management
Emphasized the importance of carefully practicing efficient: planning organizing commanding coordinating controlling Management is a separate body of knowledge that can be applied in any type of organization A theory of management that can be learned and taught There is a need for teaching management in colleges

Definition of Organizational Behavior (OB)
The study of human behavior, attitudes, and performance within an organizational setting drawing on theory, methods, and principles from such disciplines as psychology, sociology, political science, and cultural anthropology to learn about individual, groups, structure, and processes

Key Points About OB OB is a way of thinking OB is multidisciplinary
There is a distinctly humanistic orientation within OB The field of OB is performance-oriented The role of the scientific method is important in studying variables and relationships OB has a distinctive applications orientation

Contributions to the Study of Organizational Behavior
Discipline Unit of Analysis Output Psychology Individual Sociology Organizational Behavior Social Psychology Group Anthropology Organization Political Science

Studying Organizational Behavior
Leaders and Organizational Behavior The Hawthorne Studies

Topics in Studying and Understanding OB
Organizational Processes Structure Change and Innovation Understanding and Managing Individual Behavior Group Behavior and Interpersonal Influence The Organization’s Environment Break-even Analysis identifies profit or loss at various sales volumes Return on Investment measures productivity of assets Marginal Analysis compares the additional cost in a particular decision rather than average cost Game Theory mathematical models that analyze multi-party decision contexts Linear Programming for optimally solving resource allocation problems Queuing Theory for calculating waiting lines 5

The Basic Elements of a System
Inputs Process Outputs Environment

Three Perspectives on Effectiveness
Individual effectiveness Group effectiveness Organizational effectiveness

Time Dimension Model of Effectiveness
Short run Intermediate run Long run Quality Quality Quality Productivity Efficiency Satisfaction Adaptiveness Efficiency Satisfaction Survival

Systems Theory and Effectiveness (1 of 2)
Effectiveness criteria must reflect the entire input-process-output cycle, not simply output Effectiveness criteria must reflect the interrelationships between the organization and its outside environment

Systems Theory and Effectiveness (2 of 2)
Organizational effectiveness is an all-encompassing concept that includes a number of component concepts The managerial task is to maintain the optimal balance among these components

Managers can lead the way to higher levels of effectiveness by: (1 of 2)
Providing opportunities for training and continuous learning Sharing information with employees Encouraging cross-development partnerships Linking compensation to performance

Managers can lead the way to higher levels of effectiveness by: (2 of 2)
Avoiding layoffs Being a supportive role model Respecting the differences across employees Being a good listener

Key Points (1 of 2) The key to an organization’s success is its human resources Organizations need human resources that: work hard think creatively perform excellently

Key Points (2 of 2) Rewarding, encouraging, and nurturing the human resources in a timely and meaningful manner is what is required The behavior of employees is the key to achieving effectiveness

Organizational Culture
Chapter 2 Organizational Culture

Introduction National culture: the sum total of the beliefs, rituals, rules, customs, artifacts, and institutions that characterize the population A nation’s culture and sub-cultures effect how organizational transactions are conducted Learning to operate in a world influenced by national culture is becoming a requirement for effective management

Organizational Culture and Society’s Values (1 of 2)
Values – the conscious, affective desires or wants of people that guide their behavior Organizations are able to operate efficiently only when shared values exist among the employees An individual’s personal values guide behavior on and off the job

Organizational Culture and Society’s Values (2 of 2)
Values are a society’s ideas about what is right or wrong Values are passed from one generation to the next

Hofstede’s Four Value Dimensions (1 of 2)
Description Power Distance The level of acceptance by a society of the unequal distribution of power in organizations In higher power distance cultures, employees acknowledge the boss’s authority and follow the chain of command The result is a more centralized authority and structure Uncertainty Avoidance The extent to which people in a society feel threatened by ambiguous situations Countries with a high level of uncertainty avoidance tend to have specific rules, laws, and procedures Managers in these countries tend towards low-risk decision-making Employees exhibit little aggressiveness

Hofstede’s Four Value Dimensions (2 of 2)
Description Individualism The tendency of people to fend for themselves and their family In countries that value individualism, individual initiative and achievement are highly valued and the relationship of the individual with organizations is one of independence Masculinity The extent to which assertiveness and materialism is valued In highly masculine societies, there is considerable job stress and conflict between job and family roles

Cultural Values (1 of 4) Region / Country Individualism-Collectivism
Power Distance Uncertainty Avoidance Masculinity-Femininity Other Dimensions North America (USA) Individualism Low Medium Masculine Japan Collectivism High and Low High Masculine and Feminine Amae (mutual dependence) China Emphasis on tradition, Marxism, Leninism, and Mao Zedong thought

Power Distance Uncertainty Avoidance Masculinity-Femininity Other Dimensions Europe: Anglo Germanic West Slavic West Urgic Near Eastern Balkanic Nordic Individualism Medium individualism Collectivism Medium/high individualism Low/ medium Low High Low/medium Medium/high Masculine Medium/high masculine Medium masculine Feminine

Power Distance Uncertainty Avoidance Masculinity-Femininity Other Dimensions Europe: (cont’d) Latin Europe East Slavic Individualism Medium/high individualism Collectivism Low/medium High Low Medium Masculine Medium masculine

Power Distance Uncertainty Avoidance Masculinity-Femininity Other Dimensions Africa Collectivism High Feminine Colonial traditions; tribal customs Latin America Masculine Extroverted; prefer orderly customs and procedures

A society’s values have an impact on organizational values because of the interactive nature of work, leisure, family, and community.

Organizational culture – what the employees perceive and how this perception creates a pattern of beliefs, values, and expectations.

Edgar Schein’s Definition of Culture:
A pattern of basic assumptions – invented, discovered, or developed by a given group as it learns to cope with the problems of external adaptation and internal integration – that has worked well enough to be considered valid and, therefore, to be taught new members as the correct way to perceive, think, and feel in relation to those problems.

Schein’s Three-Layer Organizational Culture Model
Examples of cultural attributes Layer I: Artifacts & Creations Visible but often not decipherable Documents Physical layouts Furnishings Language Jargon Work ethic and practice Fair day’s work for a fair day’s pay Loyalty Commitment Helping others Performance leads to rewards Management equity Competency counts Technology Art Visible and audible behavior patterns Layer II: Values Greater level of awareness Testable in the physical environment Testable only by social consensus Schein’s Three-Layer Organizational Culture Model Taken for granted, invisible, preconscious Layer III: Basic Assumptions Relationship to environment Nature of reality, time, & space Nature of human nature Nature of human activity Nature of human relations

Organizational Culture and Its Effects
Strong Culture Weak Culture

The Evolution of a Positive Culture
Intervening Conditions Outcome Methods Elaborate on history Communications about and by “heroes” and others Develop a sense of history H Leadership and role modeling Communicating norms and values Create a sense of oneness O Cohesive organizational culture Reward systems Career management and job security Recruiting and staffing Socialization of new staff members Training and development Promote a sense of membership M Member contact Participative decision making Inter-group coordination Personal exchange Increase exchange among members E

Three Views on Influencing Cultural Change: (1 of 2)
Cultures are so elusive and hidden that they cannot be adequately diagnosed, managed, or changed Because it takes difficult techniques, rare skills, and considerable time to understand a culture and then additional time to change it, deliberate attempts at culture change are not really practical

Three Views on Influencing Cultural Change: (2 of 2)
People will naturally resist change to a new culture Cultures sustain people through periods of difficulty and serve to ward off anxiety Cultures provide continuity and stability

Changing Culture Intervention Points
Hiring and socialization of members who fit in with the culture Removal of members who deviate from the culture Culture 4 5 Cultural communications 3 Behavior 1 Justifications of behavior 2 Managers seeking to create culture change must intervene at these points.

Socialization and Culture
Socialization – the process by which organizations bring new employees into the culture.

The Process of Organizational Socialization
Start 1 Deselect Careful selection of entry-level candidates Consistent role models 7 2 Humility-inducing experiences promote openness toward accepting organizational norms and values Reward and recognize individuals who have done the job well Teaches the new entrant that he/she doesn’t know everything about the job or company Reinforcing folklore 6 Keeping alive stories that validate the organization’s culture 3 In-the-trenches training leads to mastery of a core discipline Adherence to values enables the reconciliation of personal sacrifices 5 Rewards and control systems are meticulously refined to reinforce behavior that is deemed pivotal to success in the marketplace 4 Extensive and reinforced on-the-job experience

Socialization Stages Anticipatory Socialization Accommodation
Role Management

A Checklist of Effective Socialization Practices (1 of 2)
Anticipatory socialization Recruitment using realistic job previews Selection and placement using realistic career paths Role management socialization Provision of professional counseling Adaptive and flexible work assignments Sincere person-oriented managers

A Checklist of Effective Socialization Practices (2 of 2)
Accommodation socialization Tailor-made and individualized orientation programs Social as well as technical skills training Supportive and accurate feedback Challenging work assignments Demanding but fair supervisors

Mentor – a friend, coach, advisor or sponsor who supports, encourages, and helps a less experienced protégé.

Mentoring Guidelines (1 of 2)
Do not dictate mentoring relationships, but encourage leaders/managers to serve a mentors Train mentors in how to be effective in mentoring others Include in the firm’s newsletter or in other forms of mass communication (print and electronic) an occasional story of mentoring as reported by a current top-level executive

Mentoring Guidelines (2 of 2)
Inform employees about the benefits and difficulties of mentor relationships with individuals of different race and gender Make sure there is diversity among the mentors All mentors should be trained in dealing with diversity

Phases of the Mentor Relationship
Initiation Cultivation Redefinition Separation 3

Cultural Diversity Diversity – the vast array of physical and cultural differences that constitute the spectrum of human differences. The managerial challenge will be to identify ways to integrate the increasing number and mix of people from diverse national cultures into the workplace.

Workforce diversity issues for managers to consider: (1 of 2)
Coping with employees’ unfamiliarity with the English language Increased training for service jobs that require verbal skills Cultural (national) awareness training for the current workforce Learning which rewards are valued by different ethnic groups

Workforce diversity issues for managers to consider: (2 of 2)
Developing career development programs that fit the skills, needs, and values of the ethnic group Rewarding managers for effectively recruiting, hiring, and integrating a diverse workforce Focusing not only on ethnic diversity, but also learning more about the diversities of age, gender, and workers with disabilities

Spirituality and Culture
Spirituality – employees have a personal or inner life that nourishes and is nourished by performing relevant, meaningful, and challenging work Workplace spirituality is not the same as religion Spirituality is a path, is personal and private, contains elements of many religions, and points to a person’s self-inquiry

Research on spirituality and work dimensions indicates:
Employees who are more spiritually involved achieve better results Spirituality encourages: trust work/life balance empathy and compassion about others the value of human assets the full development and self-actualization of people ethical behavior

Individual Differences and Work Behavior
Chapter 3 Individual Differences and Work Behavior

Why Individual Differences Are Important: (1 of 2)
Individual differences have a direct effect on behavior People who perceive things differently behave differently People with different attitudes respond differently to directives People with different personalities interact differently with bosses, coworkers, subordinates, and customers

Why Individual Differences Are Important: (2 of 2)
Individual differences help explain: Why some people embrace change and others are fearful of it Why some employees will be productive only if they are closely supervised, while others will be productive if they are not Why some workers learn new tasks more effectively than others

Attraction-Selection-Attrition (ASA) Cycle (1 of 3)
Different people are attracted to different careers and organizations as a function of their own: abilities interests personalities

Organizations select employees on the basis of the needs the organization has skills and abilities individual attributes such as values and personality

Attrition occurs when: individuals discover they do not like being part of the organization and elect to resign, or the organization determines an individual is not succeeding and elects to terminate

Each phase of the ASA cycle is significantly influenced by the individual differences of each person

Effective managerial practice requires that individual behavior differences be recognized, and when feasible, taken into consideration while carrying out the job of managing organizational behavior.

Individual Differences in the Workplace
Personality Perception Ability and Skills Attitudes Work Behavior Productivity Creativity Performance

The Basis for Understanding Work Behavior:
To understand individual differences a manager must: 1. observe and recognize the differences and 2. study relationships between variables that influence behavior

Individual Differences Influencing Work Behavior:
Ability and Skills Perception Attitudes Hereditary and Diversity Factors Personality Contracting protects the organization from changes in quantity or price on either the input or output side. We see this strategy used when management agrees to a long-term fixed contract to purchase materials and supplies or to sell a certain part of the organization’s output. Lobbying using influence to achieve favorable outcomes is a widespread practice used by organizations to manage their environment. 9

Primary Dimensions (stable)
Diversity Factors Primary Dimensions (stable) Age Ethnicity Gender Physical attributes Race Sexual / affectional orientation Secondary Dimensions (changeable) Educational background Marital status Religious beliefs Health Work experience

Sex Differences in Management: Selected Results (1 of 2)
Dimension Results Behavior: Task-oriented People-oriented Effectiveness ratings Response to poor performer Influence strategies No difference. Stereotypical difference in evaluations of managers in laboratory studies: Males favored. No difference in evaluations of actual managers. Stereotypical difference: Males use norm of equity, whereas females use norm of equality. Stereotypical difference: Males use a wider range of strategies, more positive strategies, and less negative strategies. The difference diminishes when women managers have high self-confidence.

Sex Differences in Management: Selected Results (2 of 2)
Dimension Results Motivation No difference in some studies. Non-stereotypical difference in other studies: Female motivational profile is close to that associated with successful managers. Commitment Inconsistent evidence regarding difference. Subordinates responses Stereotypical differences in responses to managers in laboratory studies; Managers using style that matches sex role stereotype are favored. No difference in responses to actual managers.

Emotional Intelligence
Abilities and Skills Ability – a person’s talent to perform a mental or physical task Skill – a learned talent that a person has acquired to perform a task Key Abilities Mental Ability Emotional Intelligence Tacit Knowledge

Attitudes Are determinates of behavior because they are linked with perception, personality, feelings, and motivation Attitude – a mental state of readiness learned and organized through experience exerting a specific response to people, objects, and situations with which it is related

Attitudes: Implications for the Manager
Attitudes are learned Attitudes define one’s predispositions toward given aspects of the world Attitudes provide the emotional basis of one’s interpersonal relations and identification with others Attitudes are organized and are close to the core of personality

The Three Components of Attitudes: Cognition, Affect, Behavior
Stimuli Manager style Technology Noise Peers Reward system Compensation plan Career opportunities Work environment factors Beliefs and values “My supervisor is unfair.” Cognition “Having a fair supervisor is important to me.” Feelings and emotions Affect “I don’t like my supervisor.” Intended behavior “I’ve submitted a formal request to transfer.” Behavior

Cognition What individuals know about themselves and their environment
Implies a conscious process of acquiring knowledge Evaluative beliefs – favorable or unfavorable impressions that a person holds toward an object or person

Affect The emotional component of an attitude Often learned from
parents teachers peer group members The part of an attitude that is associated with “feeling” a certain way about a person, group, or situation

Cognitive Dissonance A discrepancy between attitudes and behaviors
A mental state of anxiety Occurs when there is a conflict among an individual’s various cognitions after a decision has been made

Changing Attitudes The Communicator The Message The Situation

How to Increase Your Effectiveness in Changing Attitudes: (1 of 2)
Concentrate on gradually changing the attitude over a period of time Identify the beliefs or values that are part of the attitude and provide the attitude holder with information that will alter those beliefs or values

How to Increase Your Effectiveness in Changing Attitudes: (2 of 2)
Make the setting (in which the attempted change occurs) as pleasant and enjoyable as possible Identify reasons that changing the attitude is to the advantage of the attitude holder

Attitudes and Job Satisfaction
Job satisfaction – an attitude people have about their jobs Results from people’s perception of their jobs Results from the degree of fit between the individual and the organization Key factors associated with job satisfaction: Pay Promotion opportunities Supervision Coworkers Working conditions Job security

Satisfaction-Performance Relationships: Three Views
Causes “The satisfied worker is more productive.” Job Performance 1. Job Satisfaction Causes “The more productive worker is satisfied.” Job Satisfaction 2. Job Performance Perceived Equity Rewards Job Satisfaction 3. Job Performance

Personality A relatively stable set of feelings and behaviors that have been significantly formed by genetic and environmental factors The relationship between behavior and personality is one of the most complex matters that managers have to understand

Some Major Forces Influencing Personality
Cultural forces Individual Personality Social class / group membership forces Hereditary forces Family relationship forces

Personality and Behavior in Organizations
The Big Five Personality Dimensions Locus of Control Self-efficacy Creativity 4

The Big Five Personality Dimensions
Extroversion Agreeableness Conscientiousness Emotional Stability Openness to Experience

Locus of Control Locus of control of individuals –
Determines the degree to which they believe their behaviors influence what happens to them Internals – believe they are masters of their own fate Externals – believe they are helpless pawns of fate, success is due to luck or ease of task

Self-Efficacy Feelings of self-efficacy have managerial and organizational implications: Selection decisions Training programs Goal setting and performance

How to Develop Employee Creativity
Encourage everyone to view old problems from new perspectives Make certain people know that it is OK to make mistakes Provide as many people with as many new work experiences as you can Set an example in your own approach to dealing with problems and opportunities

Perceptions, Attributions, and Emotions
Chapter 4 Perceptions, Attributions, and Emotions

Perception, attribution, and emotion are not concepts a manager can directly access or fix in others. Managers need an understanding of how these factors impact a person’s view of the work environment.

Perception The cognitive process by which an individual selects, organizes, and gives meaning to environmental stimuli Through perception, individuals attempt to make sense of their environment and the objects, people, and events in it

The Perceptual Process: An Individual Interpretation
Work Environment Stimuli Response Person’s Perceptual Process: Organizing, Translating, and Selection Attitudes Feelings Motivation Behavioral Manager style Technology Noise Peers Reward system Compensation plan Career opportunities Observation Selection Translation Sight Learning Taste Smell Intensity Size Impatience Stereotyping Self-concept Emotions

The Perceptual Gap Between Supervisor and Subordinates
Frequency with Which Supervisors Say They Give Various Types of Recognition for Good Performance Frequency with Which Subordinates Say Supervisors Give Various Types of Recognition for Good Performance Types of Recognition Gives privileges 52% 14% Gives more responsibility 48% 10% Gives a pat on the back 82% 13% Gives sincere and thorough praise 80% Trains for better jobs 64% 9% Gives more interesting work 51% 3%

Self-Fulfilling Prophecy
Perceptions influence reality Self-fulfilling prophecy – tendency for someone’s expectations about another to cause the individual to behave in a manner consistent with those expectations Pygmalion effect: the positive case Golem effect: the negative case

The Pygmalion and Golem Effect
Expectations Support Granted Experience Performance Positive Negative Positive Negative More Less More Less

Perceptual Grouping (1 of 2)
The law of nearness – all other things being equal, stimuli that are near each other tend to be grouped together The law of similarity – stimuli that are similar in size, color, shape, or form tend to be grouped together

Perceptual Grouping (2 of 2)
The law of closure – the tendency to complete a figure, so that it has a consistent overall form The law of figure and ground – the tendency to group sensations into figures and backgrounds

Perceptual Grouping: Causes of Inaccuracies and Distortions
Situational Factors Needs and Perceptions Attribution Theory Halo Effect Similar-To-Me Errors Stereotyping Break-even Analysis identifies profit or loss at various sales volumes Return on Investment measures productivity of assets Marginal Analysis compares the additional cost in a particular decision rather than average cost Game Theory mathematical models that analyze multi-party decision contexts Linear Programming for optimally solving resource allocation problems Queuing Theory for calculating waiting lines 5

Stereotyping A way of categorizing individuals (or events, organizations, etc.) on the basis of limited information or observation It is a perceptual process Prejudice – a stereotype that refuses to change when presented with information indicating the stereotype is inaccurate

Sources of Prejudice Personal Prejudice Group Prejudice

How to Pay Attention to One’s Stereotyping
Remember that stereotypes are frequently based on little or inaccurate information Always be willing to change or add information that will improve the accuracy of any of your stereotypes Understand that stereotypes rarely accurately apply to a specific individual

Halo Effect Occurs when a person (e.g. manager) allows one important and noticeable characteristic of another person to bias the evaluation, perception, or impression of that person A manager’s entire approach to making judgments based on a single, obvious characteristic has to be cautiously reviewed

Attribution Theory Concerned with the process by which individuals interpret events around them as being caused by a relatively stable portion of their environment Attempts to explain the why of behavior

The Attribution Process
Event Analysis of what caused the event Reinforcement or modification of previous assumptions of causality Choices regarding future behavior Example: I received a raise I received the raise because I am a hard worker Hard work leads to rewards in this organization Since I value these rewards, I will continue to work hard in the future

Internal and External Attributions
Distinctiveness Consistency Consensus Does this person behave in this same manner in other situations? Does this person behave in this same manner at other times? Do other people behave in this same manner? YES YES NO INTERNAL ATTRIBUTION Low Distinctiveness High Consistency Low Consensus NO NO YES EXTERNAL ATTRIBUTION High Distinctiveness Low Consistency High Consensus

Managers cannot assume that their own attributions are error free
Managerial Implications of an Attributional Approach to Understanding Work Behavior: In order to influence employee behavior, the manager must understand the attributions employees make A manager must be aware that his own attributions may be different from employees’ attributions Managers cannot assume that their own attributions are error free

Impression Management
The attempt to influence others’ perception e.g., managers manage impressions by: how they talk their overall style their office location and furniture the individuals they select as employees Employees, job candidates, external stake-holders, and organizations engage in impression management

Impression Management Tactics of Individuals: (1 of 2)
Ingratiation – seek to be viewed positively by flattering others or offering to do favors for them Self-promotion – tout their abilities and competence Exemplification – seek to be viewed as dedicated by going above and beyond the call of duty

Impression Management Tactics of Individuals: (2 of 2)
Supplication – seek to be viewed as needing help because of limitations Intimidation – seeks to be viewed as powerful and threatening

Emotions A person’s emotion – a state characterized by physiological arousal and changes in facial expressions, gestures, posture, and subjective feelings Emotions are important in understanding the behavior and attitudes of people Emotions are difficult to determine with any degree of accuracy

Universal Primary Emotions
Fear Surprise Sadness Disgust Anger Joy Anticipation Acceptance

Emotional Labor (1 of 2) The management of your emotions to keep them under control In organizations, emotional labor may involve: enhancing, faking, or suppressing emotions to modify the emotional expression

Emotional Labor (2 of 2) Individuals manage their emotions through:
Surface acting – where one regulates his or her emotional expressions Deep acting – where one modifies feelings in order to express a desired emotion

Emotional Intelligence (EI)
A combination of skills and abilities such as: self-awareness self-control empathy sensitivity to the feelings of others

EI (as Defined by Mayer and Salovey)
Perception, appraisal, and expression of emotion Emotional facilitation of thinking Understanding and analyzing emotional information; employing emotional knowledge Regulation of emotion

Chapter 5 Motivation

Determinants of Job Performance
Willingness to perform Job performance Capacity to perform Opportunity to perform

The Starting Point: The Individual (1 of 4)
Most managers must motivate a diverse and unpredictable group of people The diversity results in different behavioral patterns that are in some manner related to needs and goals

Need – a deficiency or lack of something of value that an individual experiences at a particular point in time Deficiencies may be: Physiological (e.g., a need for food) Psychological (e.g., a need for self-esteem) Sociological (e.g., a need for social interaction)

When needs are present, the individual will seek to fulfill those needs and may be more susceptible to managers’ motivational efforts Work-related needs can vary from individual to individual People seek to reduce need deficiencies Need deficiencies trigger a search process for ways to reduce the tension caused by the deficiencies

The motivational process is goal-directed The goals (or outcomes) that an employee seeks are viewed as forces that attract the person The accomplishment of desirable goals can result in a significant reduction in need deficiencies

The Motivational Process: A General Model
Need deficiencies VI. II. Need deficiencies reassessed by the employee Search for ways to satisfy needs The Employee V. III. Rewards or punishments Goal-directed behavior IV. Performance (evaluation of goals accomplished)

Motivation Theories: A Summary Overview
Content Motivation Theories Theories that focus on factors within a person that: Energize behavior Direct behavior Sustain behavior Stop behavior These factors can only be inferred Process Motivation Theories Theories that describe and analyze how behavior is: Energized Directed Sustained Stopped

Content Theories of Motivation
Founders of the Theories Maslow – five-level need hierarchy Alderfer – three-level hierarchy (ERG) Herzberg – two major factors (hygienes and motivators) McClelland – three learned needs acquired from the culture Managerial Application Managers need to be aware of differences in needs, desires, and goals because each individual is unique in many ways

Maslow’s Need Hierarchy (1 of 2)
Maslow defined human needs as: Physiological: the need for food, drink, shelter, and relief from pain Safety and security: the need for freedom from threat; the security from threatening events or surroundings Belongingness, social, and love: the need for friendship, affiliation, interaction, and love

Maslow’s Need Hierarchy (2 of 2)
Esteem: the need for self-esteem and for respect from others Self-actualization: the need to fulfill oneself by making maximum use of abilities, skills, and potential

Maslow’s Need Hierarchy Related to the Job
Starting a successful new business Developing and mentoring others Using business skills to start a charity that helps homeless children SELF-ACTUALIZATION Winning a coveted award for performance Receiving a high-level promotion Earning an outstanding reputation among peers ESTEEM Being accepted by personal and professional friends Working in groups that are compatible Having supportive supervision BELONGINGNESS, SOCIAL, AND LOVE Receiving regular salary increases Having medical and disability insurance Working in a hazard free environment SAFETY AND SECURITY Receiving a sufficient salary to live on Having sufficient food and drink available Working in a comfortable environment PHYSIOLOGICAL

Maslow’s Theory: Key Points
A person attempts to satisfy basic needs before directing behavior toward satisfying upper-level needs A satisfied need ceases to motivate Unsatisfied needs can cause frustration, conflict, and stress People have a need to grow and develop and will strive constantly to move up the hierarchy in terms of need satisfaction

Alderfer’s ERG Theory Alderfer proposes a hierarchy involving three sets of needs: Existence: needs satisfied by such factors as food, air, water, pay, and working conditions Relatedness: needs satisfied by meaningful social and interpersonal relationships Growth: needs satisfied by an individual making creative or productive contributions

Alderfer’s ERG Theory: Key Points (1 of 2)
In addition to the satisfaction-progression process, a frustration-regression process is also at work e.g., if a person is continually frustrated in attempts to satisfy growth needs, relatedness needs reemerge as a major motivating force this causes the individual to redirect efforts toward satisfying a lower-order need category

Alderfer’s ERG Theory: Key Points (2 of 2)
Individuals are motivated to engage in behavior to satisfy one of the three sets of needs

Alderfer’s ERG Theory: Management Application
If a subordinate’s higher-order needs (e.g., growth) are being blocked, perhaps because of a company policy or lack of resources, Then it is in the manager’s best interest to attempt to redirect the subordinate’s efforts toward relatedness or existence needs

Herzberg’s Two-Factor Theory
Extrinsic Conditions: Dissatisfiers or Hygienes Salary Job security Working conditions Status Company procedures Quality of technical supervision Quality of interpersonal relations among peers, with superiors, and subordinates Intrinsic Conditions: Satisfiers or Motivators Achievement Recognition Responsibility Advancement The work itself The possibility of growth

Traditional versus Herzberg View of Job Satisfaction
I. Traditional Job Satisfaction Theory High job dissatisfaction High job satisfaction II. Herzberg’s Two-Factor Theory No job satisfaction High job satisfaction Based on Motivators Feeling of achievement Meaningful work Opportunities for advancement Increased responsibility Recognition Opportunities for growth No job dissatisfaction High job dissatisfaction Hygiene Factors Pay Status Job security Working conditions Employee benefits Policies and procedures Interpersonal relations 9

Herzberg’s Two-Factor Theory: Job Enrichment
The process of building personal achievement, recognition, challenge, responsibility, and growth opportunities into a person’s job Has the effect of increasing the individual’s motivation by providing him/her with more discretion and accountability when performing challenging work

McClelland’s Learned Needs Theory
McClelland contends that when a need is strong in a person, its effect is to motivate the person to use behavior that leads to its satisfaction. Achievement (n Ach) Affiliation (n Aff) Power (n Pow)

McClelland’s Theory: Key Points
Needs are learned through coping with one’s environment Since needs are learned, behavior which is rewarded tends to recur at a higher frequency As a result of the learning process, individuals develop unique configurations of needs that affect their behavior and performance

A Comparison of the Content Theories
Maslow (need hierarchy) Self-actualization Esteem Belongingness, social, and love Safety and security Physiological Herzberg (two-factor theory) The work itself Responsibility Advancement Growth Achievement Recognition Quality of interpersonal relations among peers, with supervisors, with subordinates Job security Working conditions Salary Alderfer Growth Relatedness Existence McClelland Need for achievement power affiliation Higher order needs Motivators Hygiene conditions Basic needs

Process Theories of Motivation
Founders of the Theories Vroom – an expectance theory of choices Adams – equity theory based on comparisons that individuals make Locke – goal-setting theory (conscious goals and intentions are the determinants of behavior) Managerial Application Managers need to understand the process of motivation and how individuals make choices based on preferences, rewards, and accomplishments

Vroom’s Expectancy Theory
Motivation is a process governing choices among alternate forms of voluntary activity Most behaviors are considered to be under the voluntary control of the person and consequently are motivated

Expectancy Theory: Key Terms (1 of 4)
First-Level Outcomes First-level outcomes resulting from behavior are those associated with doing the job itself They include: productivity absenteeism turnover quality of production

Second-Level Outcomes Those events (rewards and punishments) that the first-level outcomes are likely to produce, such as: merit pay increases group acceptance or rejection promotion termination

Instrumentality The perception by an individual that first-level outcomes (performance) are associated with second-level outcomes (rewards) Valence The preferences for outcomes as seen by the individual

The individual’s belief regarding the likelihood or subjective probability that a particular behavior will be followed by a particular outcome Easily thought of as a probability statement

Expectancy Theory Effort Performance First-level outcome
E P EXPECTANCY E O EXPECTANCY Perceived probability of successful performance, given effort Perceived probability of receiving an outcome, given performance Expectancy Theory Second-level outcome First-level outcome Second-level outcome Effort Performance First-level outcome Second-level outcome Second-level outcome First-level outcome Second-level outcome Second-level outcome

Equity Theory Employees compare their efforts and rewards with those of others in similar work situations Based on the assumption that individuals are motivated by a desire to be equitably (fairly) at work The individual works in exchange for rewards from the organization

Equity Theory: Key Terms
Person – the individual for whom equity or inequity is perceived Comparison other – any group or persons used by Person as a referent regarding the ratio of inputs and outcomes Inputs – the individual characteristics brought by Person to the job Outcomes – what Person received from the job

The Equity Theory of Motivation
A person (P) with certain inputs (I) and receiving certain outcomes (O) Compares his/her input/outcome ratio to reference person’s (RP) inputs (I) and outcomes (O) OP ORP IP IRP equity = and perceives or OP ORP IP IRP inequity < or OP ORP IP IRP inequity > IP: Inputs of the person OP: Outcomes of the person IRP: Inputs of reference person ORP: Outcomes of reference person 13

Change Procedures to Restore Equity
Changing inputs Changing outcomes Changing attitudes Changing the reference person Changing the inputs or outcomes of the reference person Leaving the field

Organizational Justice
The degree to which individuals feel fairly treated at the workplace Distributive justice – the perceived fairness of how resources and rewards are distributed throughout an organization Procedural justice – the perceived equity or fairness of the organization’s processes and procedures used to make resource and allocation decisions

Procedural Justice: Positive Impact
Procedural justice has been shown to have a positive impact on affective and behavioral reactions: Organizational commitment Intent to stay with the organization Organizational citizenship Trust in supervisor Satisfaction with decision outcome Work effort Performance

Key Steps to Implementing a Commitment-Oriented Management System:
Commit to people-first values Clarify and communicate your mission Guarantee organizational justice Create a sense of community Support employee development

Goal Setting: Key Concepts
The process of establishing goals Goal Specific target that a person, team, or group is attempting to accomplish Goal specificity Degree of quantitative precision (clarity) of the goal Goal difficulty Level of performance required to achieve the goal Goal intensity Process of setting the goal or of determining how to reach it Goal commitment Amount of effort used to achieve a goal

Examples of Goal Setting at Work
Developing a new software program within 4-6 months to detect malicious viruses on the Internet Landing 5 new customers or increasing sales of existing customers by 10% over the next 12 months Decreasing waste in the manufacturing process by 20% over the next 3 years

Goal Setting Applied to Organizations
Goal Characteristics Performance Rewards Clarity Meaningful Challenging Desired by Organization Preferred by Individual or Team Moderators Ability Commitment Feedback

Exchange Theory Suggests that members of an organization engage in reasonably predictable give-and-take relationships (exchanges) with each other e.g., an employee gives time and effort in exchange for pay e.g., management provides pleasant working conditions in exchange for employee loyalty

Psychological Contract (1 of 2)
An unwritten agreement between the individual and the organization which specifies what each expects to give and receive from the other These implicit agreements may take precedence over written agreements May focus on exchanges involving: satisfaction, challenging work, fair treatment, loyalty, and opportunity to be creative

Psychological Contract (2 of 2)
Managing the psychological contract is a key aspect of most managers’ jobs The more attuned the manager is to the needs and expectations of subordinates, the greater the number of matches that are likely to exist and be maintained in the psychological contract This can positively impact the direction, intensity, and persistence of motivation in the organization

Conclusions for Managers (1 of 2)
Managers can influence the motivation state of employees If performance needs to be improved, managers must intervene and help create an atmosphere that encourages, supports, and sustains improvement Managers should be sensitive to variations in employees’ needs, abilities, and goals Managers must also consider differences in preferences (valences) for rewards

Conclusions for Managers (2 of 2)
Continual monitoring of needs, abilities, goals, and preferences of employees is each individual manager’s responsibility It is not just the domain of human resources managers only Managers need to work on providing employees with jobs that offer task challenge, diversity, and a variety of opportunities for need satisfaction

Job Design, Work, and Motivation
Chapter 6 Job Design, Work, and Motivation

The jobs that people perform in organizations are the building blocks of all organization structures. A major cause of effective job performance is job design.

Job Design Job design – process by which managers decide individual job tasks and authority Job redesign – process by which managers reconsider what employees are expected to do The well-being of organizations and people relates to how well management designs jobs

The issue of designing jobs has gone beyond the determination of the most efficient way to perform tasks

Job Design and Quality of Work Life (QWL) (1 of 4)
Quality of work life (QWL) – management philosophy that Enhances the dignity of all workers Introduces cultural change in an organization Improves the physical and emotional well-being of employees

Indicators of quality of work life include: Accident rates Sick leave usage Employee turnover Number of grievances filed

The continuing challenge to management is to provide for QWL and to improve production, quality, and efficiency through revitalization of business and industry Job design attempts to: identify the needs of employees and the organization remove obstacles in the workplace that frustrate those needs

Managers hope that the results are jobs that: fulfill important individual needs contribute to individual, group, and organizational effectiveness

Conceptual Model of Job Design and Job Performance
Social setting differences Job context Perceived job content Job performance Job content Job analysis Job design Job requirements Individual differences

Job Performance Outcomes
Objective Outcomes Personal Behavior Intrinsic and Extrinsic Job Satisfaction 4

Job Analysis (1 of 2) The purpose of job analysis is to provide an objective description of the job itself The result of job analysis is a job description

Job Analysis (2 of 2) Job analysis gathers and identifies information about three aspects of all jobs: Job content Job requirements Job context

Job Content Refers to the activities required of the job
factors that define the general nature of a job Can be described as broad in scope, or narrow in scope

Functional Job Analysis (FJA)
Describes job content in terms of: What the worker does in relation to data, people, and jobs What methods and techniques the worker uses What machines, tools, and equipment the worker uses What materials, products, subject matter, or services the worker produces

Job Requirements (1 of 2) Refer to education, experience, licenses, and other personal characteristics an individual needs to perform the job content Position analysis questionnaire (PAQ), takes into account human characteristics as well as task and technological factors of jobs and job classes

Job Requirements (2 of 2) The PAQ identifies and analyzes the following job aspects: Information sources critical to job performance Information processing and decision making critical to job performance Physical activity and dexterity required of the job Interpersonal relationships required of the job Reactions of individuals to working conditions

Job Context Job context refers to factors such as the:
Physical demands and working conditions of the job Degree of accountability and responsibility Extent of supervision required or exercised Consequences of error Job context describes the environment within which the job is to be performed

Job Analysis in Different Settings
Jobs in the Factory Specialization Motion and time study Work simplification Standard methods Jobs in the New Economy Human factors Technology Knowledge workers Team-based Broadly stated job descriptions

Job Designs: The Results of Job Analysis
Job range Number of tasks a person is expected to perform while doing a job The more tasks required, the greater the job range Job depth Degree of influence or discretion that an individual possesses to choose how a job will be performed

Job Depth and Range: Differences in Selected Jobs
High College professors Hospital anesthesiologists Business packaging machine mechanics College presidents Hospital chiefs of surgery Business research scientists Job depth College instructors Hospital bookkeepers Business assembly-line workers College department chairpersons Hospital nurses Business maintenance repair workers Low Job range Low High

Job Designs: Job Relationships
Determined by managers’ decisions regarding departmentalization bases and spans of control The wider the span of control, the larger the group and, consequently, the more difficult the establishment of friendship and interest relationships The basis for departmentalization also impacts job relationships

The Way People Perceive Their Jobs (1 of 2)
Perceived job content – specific job activities and general job characteristics as perceived by individuals performing the job Two individuals doing the same job may have the same or different perceptions of job content

The Way People Perceive Their Jobs (2 of 2)
If managers desire to increase job performance by changing perceived job content, they can change: Job characteristics Individual perceptions Social settings

Six Characteristics of Perceived Job Content
Variety Autonomy Task Identity Feedback Dealing with Others Friendship Opportunities

Designing Job Range: Job Rotation and Job Enlargement
Moving individuals from one job to another Individual completes more job activities because each job includes different tasks Involves increasing the range of jobs and the perception of variety in job content Job Enlargement Increasing the number of tasks for which an individual is responsible Increases job range, but not depth

Designing Job Depth: Job Enrichment (1 of 2)
The practice of increasing discretion individuals can use to select activities and outcomes Increases job depth and accordingly fulfills growth and autonomy needs Herzberg’s two-factor theory of motivation is the impetus for designing job depth

Designing Job Depth: Job Enrichment (2 of 2)
Managers can provide employees with greater opportunities to exercise discretion by making the following changes: Direct feedback New learning Scheduling Uniqueness Control over resources Personal accountability

The Job Characteristics Model
Critical Psychological States Personal and Work Outcomes Experienced Meaningfulness of Work Skill Variety Task Identity Task Significance High Internal Work Motivation High-quality Work Performance High Satisfaction with Work Low Absenteeism and Turnover Experienced Responsibility for Outcomes of Work Autonomy Knowledge of Actual Results of Work Activities Feedback Employee’s Growth Need Strength 10

Steps that management can take to increase core job dimensions:
Combining task elements Assigning whole pieces of work (i.e., work modules) Allowing discretion in selection of work methods Permitting self-paced control Opening feedback channels

Problems associated with job design include:
Unless lower-level needs are satisfied, people will not respond to opportunities to satisfy upper-level needs Job design programs may raise employees’ expectations beyond what is possible Job design may be resisted by labor unions who see the effort as an attempt to get more work for the same pay Job design efforts may not produce tangible improvements for some time after the beginning of the effort

Teams and Job Design: Key Characteristics to Address (1 of 3)
Self-management. Refers to the team’s ability to set its own objectives coordinate its own activities resolve its own internal conflicts Participation. The degree to which all members of the team are encouraged and allowed to participate in decisions

Task variety. The extent to which team members are given the opportunity to perform a variety of tasks and use different skills Task significance. The degree to which the team’s work is valued and has significance for both internal and external stakeholders of the organization

Task identity. The degree to which a team completes a whole and separate piece of work and has control over most of the resources necessary to accomplish its objectives

Alternative Work Arrangements
Flexible work arrangements include: Job sharing Flextime Telecommuting Virtual teams Benefits to companies of flexible work programs: Higher recruitment and retention rates Improved morale Lower absenteeism and tardiness Higher levels of employee productivity

Job Embeddedness and Job Design (1 of 2)
Job embeddedness – refers to an employee’s: links with other people and teams within the organization perceptions of their fit with their job, organization, and community sacrifices that would be made if he/she left the job It is like a “net or web” that can expand across an individual’s work, home, and community activities and interests

Job Embeddedness and Job Design (2 of 2)
Managers can increase job embededdness by: Placing employees on teams that are compatible with their skill set and personality Supporting the idea of flexible work scheduling to allow their employees to pursue some non-work hobbies and volunteer leadership opportunities This will help decrease turnover of key employees

Total Quality Management and Job Design
Total quality management (TQM) combines technical knowledge and human knowledge Managers who implement TQM, design jobs that empower individuals to make important decisions about product and service quality The empowerment process encourages participative management, team-oriented task modules, and autonomy

Evaluation, Feedback, and Rewards
Chapter 7 Evaluation, Feedback, and Rewards

Introduction Organizations use a variety of rewards to attract and retain people and to motivate them to achieve their personal and organizational goals The manner and timing of distributing rewards are important issues for managers To distribute rewards equitably, it is necessary to evaluate employee performance

Purposes of Evaluation: Judgmental
Provide a basis for reward allocation (e.g., raises, promotions, transfers, etc.) Identify high-potential employees Validate the effectiveness of employee selection procedures Evaluate previous training programs

Purposes of Evaluation: Developmental
Stimulate performance improvement Develop ways of overcoming obstacles and performance barriers Identify training and development opportunities Establish supervisor-employee agreement on performance expectations

Focus of Evaluation Evaluations should focus on translating the position responsibilities into each employee’s day-to-day activities Performance evaluations should focus on job performance, not individuals Evaluations should have proper weighting of relevant behaviors

Relevancy of Evaluation
Deficiency – occurs when the evaluation does not focus on all aspects of the job Contamination – occurs when activities not part of the job are included in the evaluation Distortion – occurs in the evaluation process when an improper emphasis is given to various job elements

Improving Evaluations (1 of 3)
Higher levels of employee participation in the evaluation process lead to more satisfaction with the system Setting specific performance goals to be met results in greater performance improvement than discussions of more general goals

Supervisors should receive training in how to evaluate employee performance They should be evaluated on how effectively they do this Systematic evaluation of performance does little good if the results are not communicated to employees

Performance evaluation feedback should not focus solely on problem areas Good performance should be actively recognized and reinforced Effective performance evaluation is a continuous, ongoing process

Performance Evaluation Feedback
The need for feedback among people on and off the job is significant People want to know: how they are doing how they are being perceived by others how they can make adjustments to perform better Delivering feedback to a poor performing employee is a difficult experience for a manager

Purpose of Evaluation Feedback
Instructional Motivational

A Feedback Model Evaluated Person Individual Characteristics:
Perceptual Process Values Needs Goals Self-Concept Self-Efficacy Behavioral Results Effort Self-motivation to Adjust Persistence Disregard or Non-acceptance Person Others Job Cognitive Evaluation: Creditive of Feedback Source Expectancies Personal Standards Form of Feedback (Objective or Subjective)

Multisource Feedback: A 360-Degree Approach
90 percent of Fortune 1000 firms use some form of multisource program The increasing use of multisource programs is the result of calls for more fairness clarity credibility Everyone in the person’s full domain could serve as an evaluator

Best Practices to Improve 360-Degree Feedback Programs (1 of 2)
Use 360-degree feedback primarily for individual development Link the feedback process with the overall strategy and direction of the firm Exert administrative control over every aspect of the 360-degree process

Best Practices to Improve 360-Degree Feedback Programs (2 of 2)
Use senior management as role models Use highly trained internal coaches to leverage the investment Evaluate the effectiveness or return on investment of the process

Reinforcement Theory Reinforcement is the most important principle of learning Desirable or reinforcing consequences will increase the strength of a behavior and increase the probability of being repeated Undesirable or punishment consequences will decrease the strength of a response and decrease its probability of being repeated

Rewards, Reinforcement, and Punishment
Positive reinforcement (behavior increases) Punishment (behavior decreases) Negative reinforcement I II Applied III IV Withdrawn Desirable Undesirable 4

Reinforcement Theory: Operant Conditioning
Operant conditioning – attempts to influence behavior through the use of rewards and punishments Operants – behaviors that can be controlled by altering the consequences that follow them Most workplace behaviors are operants

Operant Conditioning: Key Principles
Reinforcement Punishment Extinction

Reinforcement Schedules
Description Organizational Example Continuous Reinforcer follows every response Praise after every new sale and order Fixed interval Response after specific time period is reinforced Weekly, bimonthly, monthly paycheck Variable interval Response after varying period of time (an average) is reinforced Transfers, unexpected bonuses, promotions, recognition Fixed ratio A fixed number of responses must occur before reinforcement Piece rate, commission on units sold Variable ratio A varying number (average) of responses must occur before reinforcement Random checks for quality yield praise for doing good work

Individual Rewards The main objectives of reward programs are:
to attract qualified people to join the organization to keep employees coming to work to motivate employees to achieve high levels of performance

The Reward Process Ability and skill Intrinsic rewards
Performance results: Individual Motivation to exert effort Performance evaluation Satisfaction Extrinsic rewards Experience Feedback

Lawler’s Conclusions on Satisfaction and Rewards (1 of 2)
Satisfaction with a reward is a function both of how much is received and of how much the individual feels should be received An individual’s feelings of satisfaction are influenced by comparisons with what happens to others Satisfaction is influenced by how satisfied employees are with both intrinsic and extrinsic rewards

Lawler’s Conclusions on Satisfaction and Rewards (2 of 2)
People differ in the rewards they desire and in how important different rewards are to them Some extrinsic rewards are satisfying because they lead to other rewards

Management Considerations for Developing and Distributing Rewards
The rewards available must be sufficient to satisfy basic human needs Individuals tend to compare their rewards with those of others The process by which rewards are distributed should be perceived as fair The managers distributing the rewards must recognize individual differences

Intrinsic and Extrinsic Rewards
Extrinsic reward – initiated from outside the person Salary and wages Employee benefits Interpersonal rewards Promotions Intrinsic reward – one that is self-administered by the person Completion Achievement Autonomy Personal growth

Administering Rewards
Positive Reinforcement Modeling and Social Imitation Expectancy Theory

Rewards Affect Organizational Concerns
Rewards affect employee perceptions, attitudes, and behavior Key organizational concerns affected by rewards: Turnover Absenteeism Performance Commitment

Innovative Reward Systems
Skill-based pay Broadbanding Team-based rewards Concierge services Banking time off Part-time Benefits Gainsharing Employee stock ownership plans

Line of Sight: The Key Issue (1 of 2)
Line of sight – means that the employee perceives that there is a “real” linkage between his or her performance and the rewards received For extrinsic rewards, organizations need to have systems that clearly tie rewards to desired performance

Line of Sight: The Key Issue (2 of 2)
Organizations can influence intrinsic rewards by: providing jobs that are challenging providing clear feedback on job performance

Chapter 10 Groups and Teams

The existence of groups can alter a person’s motivation or needs and can influence the behavior of people in an organizational setting.

Introduction Groups and teams are not the same
Group – two or more individuals interacting with each other to accomplish a common goal Teams – mature groups with a degree of member interdependence and motivation to achieve a common goal

Teams and Groups Share Many Common Characteristics:
They can be formed when two or more individuals interact Both teams and groups provide structure for the work and interaction of its members Their members can perform specific technical, leadership, problem-solving, and emotional roles Members of groups and teams share a common goal(s)

Group Versus Team Differences
Formal Work Group Team Works on common goals Total commitment to common goals Accountable to manager Accountable to team members Skill levels are often random Skill levels are often complementary Performance is evaluated by leader Performance is evaluated by members as well as leaders Culture is one of change and conflict Culture is based on collaboration and total commitment to common goals Performance can be positive, neutral, or negative Performance can be greater than the sum of members’ contribution or synergistic (e.g., = 5) Success is defined by the leader’s aspirations Success is defined by the members’ aspirations

Types of Groups Formal Groups Command Group Task Group Team
Informal Groups Interest Group Friendship Group

Why People Form Groups Need Proximity Satisfaction Economics Goals
Attraction Goals Economics Need Satisfaction Proximity The following suggestions specify the types of changes in jobs that are most likely to lead to improvements in each of the five core dimensions. (1) Combine tasks - managers should put existing fractionalized tasks back together to form a new, larger module of work. This increases skill variety and task identify. (2) Create natural work units - managers should design tasks that form an identifiable and meaningful whole. This increases employee “ownership” of the work and encourages employees to view their work as meaningful and important rather than as irrelevant and boring. (3) Establish client relationships - the client is the user of the product or service that the employee works on. Whenever possible, managers should establish direct relationships between workers and their clients. This increases skill variety, autonomy, and feedback for the employee. (4) Expand jobs vertically - vertical expansion means giving employees responsibilities and controls that were formerly reserved for management. It partially closes the gap between the “doing” and “controlling” aspects of the job, and it increases employee autonomy. (5) Open feedback channels - by increasing feedback, employees not only learn how well they are performing their jobs but also whether their performances are improving, deteriorating, or remaining at a constant level. Ideally, employees should receive performance feedback directly as they do their jobs rather than from management on an occasional basis. 9

Stages of Group Development
Group forms and situation is uncertain and disorganized 1. Forming Stages of Group Development Turbulence, disruption, and frustration is at highest level 2. Storming Share vision, values, goals, and expectations; deviations are not welcome 3. Norming Roles are specific, goals are clear, and results are noted 4. Performing Disbands in an orderly way 5. Adjourning

Stages of Group Development (1 of 3)
Stage 1: Forming The beginning stage of group development Individuals are brought together as a functioning unit Agree to rules of conduct and the goals of the team Stage 2: Storming Most turbulent stage of group development The group confronts conflicts and discovers ways to keep the group focused

Stage 3: Norming The group establishes its long-term vision of how it will function over time This agreement is referred to as shared values The group’s norms are the unwritten rules of correct behavior and decorum

Stage 4: Performing Reached when the group is able to begin performing the task it was designed to address The group begins to fine-tune its work patterns Stage 5: Adjourning A functioning group or team is able to disband once the work tasks are completed

Characteristics of Groups
Norms Leadership Cohesiveness Status Hierarchy Roles Composition Break-even Analysis identifies profit or loss at various sales volumes Return on Investment measures productivity of assets Marginal Analysis compares the additional cost in a particular decision rather than average cost Game Theory mathematical models that analyze multi-party decision contexts Linear Programming for optimally solving resource allocation problems Queuing Theory for calculating waiting lines 5

Composition The extent to which group members are alike
Homogeneous group – members share a number of similar characteristics Heterogeneous group – members have few or no similar characteristics Group composition can influence outcomes

Status Hierarchy Status – the rank, respect, or social position that an individual has in a group Individuals in leadership roles possess status because of their roles The individual’s skill in performing a job as a factor related to status Expertise in the technical aspects of the job is a factor related to status

Roles Expected Role Perceived Role Enacted Role

Norms Norms – the standards shared by members of a group
Formed only with respect to things that have significance to the group Accepted in various degrees by group members May apply to every group members, or may apply to only some group members

Norm Conformity Why employees conform to group norms is an issue of concern to managers Variables which influence conformity to norms: personal characteristics of the individual situational factors inter-group relationships cultural factors

Leadership In the formal group the leader can exercise legitimately sanctioned power i.e., the leader can reward or punish members who do not comply with the orders or rules Sometimes a formal group has no single formal leader autonomous work groups self-managed teams

Characteristics of Informal Group Leaders (1 of 2)
The leadership role is filled by the individual who possesses the attributes that members perceive as being critical for satisfying their needs The leader embodies the values of the group able to perceive those values able to organize them into intelligible philosophy able to verbalize them to nonmembers

Characteristics of Informal Group Leaders (2 of 2)
The leader is able to receive and interpret communication relevant to the group able to effectively communicate important information to group members

Group Cohesiveness Cohesiveness – the extent that group members are attracted to each other and to the group values and accept group goals It is the pressure on the individual member to remain active in the group and resist leaving it As the cohesiveness of a work group increases, the level of conformity to group norms also increases

Group Cohesiveness: Sources of Attraction to a Group (1 of 2)
The goals of the group and the members are compatible and clearly specified The group has a charismatic leader The reputation of the group indicates that the group successfully accomplishes its tasks

Group Cohesiveness: Sources of Attraction to a Group (2 of 2)
The group is small enough to permit members to have their opinions heard and evaluated by others The members support one another and help one another overcome obstacles and barriers to personal growth and development

Group Cohesiveness and Organizational Goals
Agreement with Organizational Goals Low High Performance probably oriented away from organizational goals Performance probably oriented toward organizational goals Performance oriented away from organizational goals Performance oriented toward organizational goals Low Degree of Group Cohesiveness High

Strategies for Increasing Group Cohesion (1 of 2)
Inducing agreement on group goals Making the group more homogeneous in its composition Increasing the frequency of interaction among group members

Strategies for Increasing Group Cohesion (2 of 2)
Making the group smaller Physically and/or socially isolating the group from other groups Allocating rewards to the group rather than to the individual

Groupthink A decision-making process sometimes utilized by groups
Irving Janis defines groupthink as the: “deterioration of mental efficiency, reality testing, and moral judgment” in the interest of group solidarity

Groupthink: Characteristics (1 of 3)
Illusion of invulnerability. Group members collectively believe they are invincible Tendency to moralize. Opposition to the group’s position is viewed as weak, evil, or unintelligent

Feeling of unanimity. All group members support the leader’s decisions Members keep dissenting views to themselves

Pressure to conform. Formal and informal attempts are made to discourage discussion of divergent views Opposing ideas dismissed. Any individual or outside group that criticizes or opposes a decision receives little or no attention from the group

End Results Groups exist to accomplish objectives
In the case of work groups: objectives are related to the performance of specific tasks specific tasks are designed to result in attainment of formal organizational outcomes

Hackman’s Criteria of Group Effectiveness:
The extent to which the group’s productive output meets the standard of quantity, quality, and timeliness of the users of the output The extent to which the group process of actually doing the work enhances the capability of group members to work together interdependently in the future The extent to which the group experience contributes to the growth and well-being of its members

Problem-Solving Teams Cross-Functional Teams
Types of Teams (1 of 3) Problem-Solving Teams Formed to deal with problems i.e., specific and known problems (usually temporary team) i.e., potential future problems not yet identified Quality circle – permanent problem-solving team Cross-Functional Teams Consists of members from different functional departments Formed to address a specific problem Members come from different departments and levels

Virtual Teams (continued)
Types of Teams (2 of 3) Virtual Teams A number of people geographically separated that are assembled by using various technologies to accomplish specific goals Can meet without concern for space, time, or physical presence Efficient and successful use of technology is a key factor Virtual Teams (continued) As virtual team members interact, it is important for leaders to: coach build trust evaluate performance provide feedback

Research and Development Teams
Types of Teams (3 of 3) Research and Development Teams Used to develop new products Usually composed of members from many different departments or functions Can significantly reduce the time required to bring a new product to the marketplace e.g., skunk works Self-Managed Teams Small groups of individuals empowered to perform certain activities based on procedures established and decisions made within the team, with minimum or no outside direction Need to be consistent with the organization’s: business requirements values and goals competencies

Factors Influencing Team Effectiveness
Training Communications Empowerment Rewards 4

Skills for Team Members to Be Effective:
Open-mindedness Emotional stability Accountability Problem-solving abilities Communication skills Conflict resolution skills Trust

Steps for Managers to Help Ensure Teams Work:
Keep the team size as small as possible Make certain that a sufficient range of skills, information, and/or experience to do the task exists among team members Instill in the team a sense of common purpose Give the team leeway to develop its own set of work procedures without outside interference Help develop a sense of mutual accountability

Organizational Structure and Design
Chapter 16 Organizational Structure and Design

Organization structure – the pattern of jobs and groups of jobs in an organization.
It is an important cause of individual and group behavior.

The Concept of Organization Structure
Structure as recurring activities Structure as an influence on behavior

Organization design – management decisions and actions that result in a specific organization structure.

Organizational Design Decisions
Managers decide how to divide the overall task into successively smaller jobs Managers decide the bases by which to group the jobs Managers decide the appropriate size of the group reporting to each superior Managers distribute authority among the jobs

The Four Key Design Decisions
Specialization Division of Labor: Low High Basis Departmentalization: Homogeneous Heterogeneous Number Span of Control: Few Many Delegation Authority: High Low 3

Division of Labor Division of labor – concerns the extent to which jobs are specialized It is the process of dividing work into relatively specialized jobs to achieve advantages of specialization

Division of Labor Occurs in Three Different Ways:
1. Personal specialties e.g., accountants, software engineers, graphic designers, scientists, etc. 2. Natural sequence of work e.g., dividing work in a manufacturing plant into fabricating and assembly (horizontal specialization) 3. Vertical plane e.g., hierarchy of authority from lowest-level manager to highest-level manager

Delegation of Authority
Managers decide how much authority should be delegated to each job and to each jobholder Delegation of authority – process of distributing authority downward in an organization

Reasons to Decentralize Authority
Relatively high delegation of authority encourages the development of professional managers High delegation of authority can lead to a competitive climate within the organization Managers who have relatively high authority can exercise more autonomy, and thus satisfy their desires to participate in problem solving

Reasons to Centralize Authority (1 of 2)
Managers must be trained to make the decisions that go with delegated authority Many managers are accustomed to making decisions and resist delegating authority to their subordinates

Reasons to Centralize Authority (2 of 2)
Administrative costs are incurred because new control systems must be developed to provide top management with information about the effects of subordinates’ decisions Decentralization means duplication of functions

Delegation Decision Guidelines (1 of 2)
How routine and straightforward are the job’s or unit’s required decisions? The authority for routine decisions can be centralized Are individuals competent to make the decision? Even if the decision is non-routine, if the local manager is not capable, then the decision should be centralized Delegation of authority can differ among individuals depending upon each one’s ability to make the decision

Delegation Decision Guidelines (2 of 2)
Are individuals motivated to make the decision? Capable individuals are not always motivated individuals Motivation must accompany competency to create conducive conditions for decentralization Do the benefits of decentralization outweigh its costs?

Departmentalization – process in which an organization is structurally divided by combining jobs in departments according to some shared characteristic or basis.

Departmentalization Bases
Functional Geographic Product Customer 4

Departmental Bases: Functional Departmentalization
Jobs are combined according to the functions of the organization The principal advantage is efficiency By having departments of specialists, management creates efficient units A major disadvantage is that organizational goals may be sacrificed in favor of departmental goals

Functional Departmentalization Structure
OBM Company Engineering Reliability Finance Public Relations Manufacturing Distribution Human Resources Purchasing 4

Departmental Bases: Geographic Departmentalization
Establish groups according to geographic area The logic is that all activities in a given region should be assigned to a manager Advantageous in large organizations because physical separation of activities makes centralized coordination difficult Provides a training ground for managerial personnel

Geographic Departmentalization Structure
Northeast Midwest Southeast Pacific OBM Company Southwest

Departmental Bases: Product Departmentalization
All jobs associated with producing and selling a product or product line will be placed under the direction of one manager Product becomes the preferred basis as a firm grows by increasing the number of products it markets Concentrating authority, responsibility, and accountability in a specific product department allows top management to coordinate actions

Product Departmentalization Structure
OBM Company Small Household Appliances Large Household Appliances Commercial Appliances Building Materials and Products Lawn and Garden Products Automotive Products 7

Departmental Bases: Customer Departmentalization
The importance of customer satisfaction has stimulated firms to search for creative ways to serve people better Organizations with customer-based departments are better able to satisfy customer-identified needs than organizations that base departments on non-customer factors

Customer Departmentalization Structure
Retail Stores Mail Order On-Line Sales Government Contracts OBM Company Institutional

Span of Control (1 of 2) Number of individuals who report to a specific manager Narrow span Wide span The frequency and intensity of actual relationships is the critical consideration in determining the manager’s span of control

Degree of Specialization Ability to Communicate
Span of Control (2 of 2) Key Factors If we shift our attention from potential to actual relationships as the bases for determining optimum span of control, three factors appear to be important: Required Contact Degree of Specialization Ability to Communicate

Dimensions of Structure
Formalization – the extent to which expectations regarding the means and ends of work are specified, written, and enforced Centralization – the location of decision-making authority in the hierarchy Complexity – the direct outgrowth of dividing work and creating departments

Organization Design Models
The Mechanistic Model Emphasizes importance of achieving high levels of production and efficiency through: Extensive use of rules and procedures Centralized authority High specialization of labor The Organic Model Emphasizes importance of achieving high levels of production and efficiency through: Limited use of rules and procedures Decentralized authority Relatively low degrees of specialization

Comparison of Mechanistic and Organic Structures (1 of 3)
Process Mechanistic Structure Organic Structure 1. Leadership Includes no perceived confidence and trust between superiors and subordinates. Includes perceived confidence and trust between superiors and subordinates. 2. Motivation Taps only physical, security, and economic motives, through use of fear and sanctions. Taps a full range of motives through participatory methods. 3. Communication Information flows downward and tends to be distorted, inaccurate, and viewed with suspicion by subordinates. Information flows freely: upward, downward, and laterally. The information is accurate and undistorted.

Process Mechanistic Structure Organic Structure 4. Interaction Closed and restricted. Subordinates have little effect on departmental goals, methods, and activities. Open and extensive. Both superiors and subordinates are able to affect departmental goals, methods, and activities. 5. Decision Relatively centralized. Occurs only at the top of the organization. Relatively decentralized. Occurs at all levels through group processes. 6. Goal setting Located at the top of the organization, discouraging group participation. Encourages group participation in setting high, realistic objectives.

Process Mechanistic Structure Organic Structure 7. Control Centralized. Emphasizes fixing blame for mistakes. Dispersed throughout the organization. Emphasizes self-control and problem solving. 8. Performance goals Low and passively sought by managers, who make no commitment to developing the organization’s human resources. High and actively sought by superiors, who recognize the need for full commitment to developing, through training, the organization’s human resources.

Organization Design Models: The Matrix Model
Matrix organization – attempts to maximize the strengths and minimize the weaknesses of both the functional and product bases Superimpose a horizontal structure of authority, influence, and communication on the vertical structure Facilitates the utilization of highly specialized staff and equipment

Example of the Matrix Organization Model
Functions Project or product A Project or product B Project or product C Project or product D Project or product E Projects, products Manufacturing Marketing Engineering Finance 8

Advantages of Matrix Organization
Efficient use of resources Flexibility in conditions of change and uncertainty Technical excellence Freeing top management for long-range planning Improving motivation and commitment Providing opportunities for personal development

Evolutionary Steps to the Matrix Model
Task Force (1) Teams (2) Product Managers (3) Product Management Depts. (4)

Multinational Structure and Design
Multinational corporation – consists of a group of geographically dispersed organizations with different national subsidiaries Multinational corporations frequently exist in very divergent environments The most prevalent departmental basis is geographic

Multinational Corporations: Implications for Organizational Design (1 of 2)
National boundaries are an important force in defining organizational environments Subsidiaries or affiliates of multinational corporations can act as conduits that introduce changes into the host country’s environment

Multinational Corporations: Implications for Organizational Design (2 of 2)
Subsidiaries of multinational corporations can act as conduits through which features of the host country culture are introduced throughout the multinational organization

Virtual Organizations
Virtual organization – a collection of geographically distributed, functionally and/or culturally diverse aggregations of individuals that is linked by electronic forms of communication Assembled and disassembled according to needs

Virtual Organizations: Factors in Design Considerations
Personnel distributed geographically Electronically connected Differences in expertise and function Culturally diverse Work schedule differences Horizontally arranged with little emphasis on command and control authority

Virtual Organizations: Design Implications
Contractual relationships Constant change and reconfiguration No rigid boundaries Flexible Little or personal and social contact

Virtual Organizations: Consequences
Increase in overall communication and messages Relationships are tenuous Continual surety of roles, tasks, and assignments Caution needed in managing feedback, discussion, performance review, and reward systems Greater equity of participation

Boundaryless Organizations
Organizations in which: the hierarchy and chain of command are minimized rigidly structured departments are eliminated Implemented to reduce barriers between people and constituencies

Introduction to Organizational Behavior

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