11 According to the current view of managerial functions, the central role for managers is to provide leadership and direction. Managers and employees now share the responsibility for the other traditional managerial functions. In some businesses, teams handle the controlling and monitoring functions. For example, many organizations use Total Quality Management --a concept popularized by W. Edwards Deming to promote customer satisfaction through continuous improvement of business processes. Continuous improvement requires all employees to improve the quality of products or services on an on-going basis. Managing quality becomes everyone’s job.
14 Managers must manage change by recognizing and adapting to new trends. Therefore, managers must analyze business, social, cultural, and political trends; understand the implications of these trends; and adapt to them. The traditional vertical career ladder is becoming increasingly rare. Moreover, few organizations promise long, stable employment. As a result, managers must manage their own careers through creative planning and by actively seeking training, education, and new learning opportunities. Establishing and managing strong relationships with people within and without the organization will be important to future managers. Therefore, they must master the skill of managing diverse relationships --that is, the ability to guide and control personal and work relationships effectively. Managers must be able to delegate tasks and empower employees and team members. While delegation refers to assigning various tasks to employees, empowerment goes one step further. Managers give employees the authority and responsibility to complete tasks; thus, employees are empowered to be in charge of jobs.
4 Organizations are groups of two or more people who cooperate and coordinate their activities in a systematic manner to reach their goals. Organizational behavior (OB) is the study of how people behave in organizations as individuals or as teams and how organizations structure human resources to achieve their goals. The purpose of OB is to understand people in organizations, to provide managers and practitioners with effective management tools, and to help organizations achieve their goals.
In an open system, an organization takes in resources from its external environment and converts or transforms them into goods and services that are sent back to that environment, where they are bought by customers. The activities of most organizations can be modeled using the open-systems view. Consider asking students to apply the open systems model to a company’s processes. The system is said to be open because the organization draws from and interacts with the external environment to secure resources, transform them, and then sell the products created to customers.
4 Figure 1.1 illustrates how organizational behavior concepts and theories allow people to correctly understand, describe, and analyze the characteristics of individuals, groups, work situations, and the organization itself.
Organizational behavior can be examined at 3 levels: organizational, group, and individual. OB is particularly important to managers.
Figure 1.3 illustrates how the text covers the three levels of organizational behavior. Part I includes chapters 2-9. Part 2 includes chapters 10-15. Part 3 includes chapters 16-18.
5 The first level of Organizational Behavior (micro OB) studies the individual. It is the smallest level of organizational analysis and includes topics such as perception, personality, motivation, and learning. The second level of organizational behavior is the small group that is made up of individual employees (two people or more) within an organization. It includes issues of group size and composition, cohesion, trust, conflict management, team building, small-group decision making, and leadership. The third level of OB analysis (macro OB) involves larger groups, such as departments, and organizational processes. Topics include the design and structure of organizations, organizational culture and strategy, organizational power and politics, change, and organizational effectiveness. Most managers must understand their organizations at all three levels of analysis to meet the daily challenges they face.
17 Though the world is becoming more interconnected, culture, politics, and religion can impede day-to-day business interactions. To manage the process of globalization more effectively, countries are signing agreements to reduce tariffs, subsidies, quotas, and other obstacles to business cooperation. Managers face two cultural issues in the workplace. As companies step outside their national borders, managers must change their managerial practices to fit other cultures. In addition, they must also deal with cultural diversity --differences due to ethnicity, religion, age, or sexual orientation. Globalization and technology are changing the marketplace. Managing the rapid pace of change is another challenge that managers and organizations face. If well managed, change can promote growth; if poorly managed, change can devastate any organization. Businesses must respond to the needs of customers in order to succeed. The challenge of delivering high quality and low cost has forced organizations to seek ways to become more efficient. Businesses must remain responsive to external and internal stakeholders --the individuals or groups that have some interest or stake in the organization. But what may benefit one group of stakeholders may hurt another group. To balance the needs of multiple stakeholders, managers must analyze business decisions in light of legal concerns, ethical considerations, and social responsibilities.
18 Organizations are going global by expanding markets and operations all over the world. In addition, firms are promoting diversity and training managers to handle cultural diversity. To face the global, quality, and efficiency challenges, many organizations are restructuring --that is, changing the way human resources are organized. The goals of restructuring are increased flexibility, quicker response to external changes, and more fluid structures. Entrepreneurs provide considerable competition for large businesses. Free of bureaucratic red tape and more connected to their customers, they can “turn on a dime” when a new opportunity or challenge arises. The flexibility, creativity, and responsiveness of entrepreneurs are benefits that many large businesses try to harness by encouraging intrapreneurs --employees in large organizations that have the drive, creativity, and flexibility of entrepreneurs. Through the use of high technology , business organizations can become more flexible and efficient. Computer networks, state-of-the-art hardware and software, information technology, telecommunication tools, automation, and robotics allow organizations to do more in less time.
19 To respond to globalization and cultural issues , managers must learn to work with people from other countries effectively and manage diverse cultures inside and outside the organization. To keep up with the rapid pace of change , managers must recognize, adapt to, and reap the inherent benefits of change. To respond to customer demands for low-cost, high-quality products and services, managers must adjust to new situations quickly, respond to organizational and customer demands efficiently, and think broadly and creatively. Managers must work with a diverse workforce, be socially responsible and aware of ethical issues, and consider the effects of business activities on multiple stakeholders .
AFTER STUDYING THIS CHAPTER, YOU SHOULD BE ABLE TO:
Define organizational behavior (OB).
Describe what managers do.
List the major challenges and opportunities for managers to use OB concepts.
Identify the contributions made by major behavioral science disciplines to OB.
AFTER STUDYING THIS CHAPTER, YOU SHOULD BE ABLE TO:
Describe why managers require a knowledge of OB.
Explain the need for a contingency approach to the study of OB.
. . . a field of study that investigates how individuals, groups and structure affect and are affected by behaviour within organizations, for the purpose of applying such knowledge toward improving an organization’s effectiveness.
Let employees make decisions that affect their work
Offer assistance with childcare
Have minimal bureaucracy (red tape)
“ Old” Companies
Think casual Fridays are pitiful
Charge employees for perks and incentives
Hold events on employee time
Have flex time: but only between 7:30 a.m. and 6:30 p.m.
Hide financial results from their employees
Encourage employee input -- but rarely act on it
Employ rigid hierarchies (chain of command)
Stop at “open door” policies
Exhibit 1-1 Challenges Facing the Workplace Workplace Organizational Level • Productivity • Developing effective employees • Global competition • Managing in the global village Group Level • Working with others • Workforce diversity Individual Level • Job satisfaction • Empowerment • Behaving ethically
Exhibit 1-4 The Layers of OB The Organization Negotiation Conflict Communication Groups and teams Power and politics The Group Emotions Values and attitudes Perception Personality Motivating self and others The Individual Change Organizational culture Decision making Leadership Groups and teams
Exhibit 1-3 Toward an OB Discipline Social psychology Psychology Behavioural science Contribution Unit of analysis Output Anthropology Sociology Political science Study of Organizational Behaviour Organization system Learning Motivation Perception Training Leadership effectiveness Job satisfaction Individual decision making Performance appraisal Attitude measurement Employee selection Work design Work stress Group dynamics Work teams Communication Power Conflict Intergroup behaviour Formal organization theory Organizational technology Organizational change Organizational culture Conflict Intraorganizational politics Power Organizational culture Organizational environment Behavioural change Attitude change Communication Group processes Group decision making Group Comparative values Comparative attitudes Cross-cultural analysis Individual
A schematic drawing that depicts hierarchical relationships (chain of command) among all positions in the organization.
Nonmanager Nonmanagers Managers Key Nonmanager Nonmanager Nonmanager Nonmanager Nonmanager Nonmanager Nonmanager Manager Director Director Director Director Director Director Manager Vice President Vice President Vice President President
Challenges for Today’s Organizations Rapid Pace of Change Multiple Stakeholders Globalization and Culture High Quality and Low Cost
The Response of Organizations Globalization and Cultural Issues Rapid Pace of Change Demand for Quality and Low Cost Multiple Stakeholders Going Global and Promoting Diversity Restructuring Entrepreneurship and Intrapreneurship High-Technology
The Response of Managers Globalization and Cultural Issues Rapid Pace of Change Demand for Quality and Low Cost Multiple Stakeholders Work With Others and Manage Diversity Identify and Harness Opportunities Be Flexible, Learn Fast, and Think Creatively Adopt a Broad, Big-Picture View