Industrial psychology by_pawan_tripathi_e_book___2014_09_07_15_23_42_168

Industrial psychology
By
Pawan Kumar Tripathi
{ Asst. Professor }
Skyline Institute of Engineering and Techonology Gr. Noida
Contact no. 09456295085
Email. pawantripathi42@gmail.com
About the Author: Mr. Tripathi , A young and dynamic management
Professional powered with the knowledge of law, completed his
management program from Shambhunath Institute of Engineering and
Technology, Allahabad a premier institute affiliated from Uttar Pradesh
Technical University, Lucknow and holded a honorary ―Research
fellowship‖ from ―American Biographical institute‖ Based at releigh
Berg north Carolena U.S.A. he holds rich experience with extensive
cross-functional experience in successfully and consistently delivering
the responsibilities of Human Resource Development & Training Areas
since last 4 years.
A competent and diligent professional with capability to handle a wide range of assignments ranging
from Corporate to Campus relations, Public Relations, Strategic Planning, Market Research and
complete range of legal consultation and fully eligible appear in any court of law in india.
He is Resourceful and competent to create win-win relationship with Corporate and its various stake
holders. Being young and energetic he understands the modern requirement of the corporate HR and IR
aspect to equipped any industry with rich and talented people. He possess keen acumen in analyzing
and understanding requirements of the industries and help in value maximization and developing new
business processes and revenue streams in a planned manner.
Mr. Tripathi had published number of research paper in journal of international and national repute on
HR and IR domain. He had also published a text book for law students. Along with teaching and
training to the candidate, He is actively involved in the Area of HR , IR, Corporate Law Consulting,
Training, Recruitment and solution for corporate legal complexities.
Industrial Psychology By Pawan Kumar Tripathi Email. Pawantripathi42@gmail.comPage 1

Message to the Reader:
“When one door closes, another opens; but we often look so long and so regretfully upon the
closed door that we do not see the one which has opened for us.” –Alexander Graham Bell.
I was inspired to frame my knowledge in to the little piece of work because of a constant and
insisting demand of my students.
Dear all I wish to link you with the above quotations and wish a great time and career path for
you. i have not only but also a faith that this e book will meet your expectations for knowledge
and time constraint in order to qualify in the exam in best manner and it is intently made for
your purpose.
This book is dedicated to my father Late Krishan kumar tripathi who left me at the age of 13
yrs. But still I always guided by him in all ups and downs of life. The contributions of my
mother who proved herself as an iron lady and shape us in such a way cant ignored.
I want to convey my best compliment Dr. S.C.Tripathi who is a living god for me in the earth.
I m also thankful to all the authors from where the material has been collected and pick
figures has been drawn to make this book more effective and compact,
lastly I m thankful to all my present and previous students who always inspired us to put my
best before them and always take part in my knowledge sharing session. Suggestions are
always encouraged from the readers.
All the best
Author
© 2014, author Mr. Pawan Kumar Tripathi. All rights reserved. This material may not be reproduced,
displayed, modified or distributed without the express prior written permission of the copyright holder.
For permission, contact [ Pawantripathi42@gmail.com].

Syllabus
NHU-301 : Industrial Psychology
Unit-I
Introduction to Industrial Psychology – Definitions & Scope. Major influences on industrial
Psychology- Scientific management and human relations schools Hawthorne Experiments
Unit-II
Individual in Workplace Motivation and Job satisfaction , stress management. Organizational
culture, Leadership & group dynamics.
Unit-III
Work Environment & Engineering Psychology-fatigue. Boredom, accidents and safety. Job
Analysis, Recruitment and Selection – Reliability & Validity of recruitment tests.
Unit –IV
Performance Management : Training & Development.

Unit-I
Focus Areas: Introduction to Industrial Psychology – Definitions & Scope. Major influences on
industrial Psychology- Scientific management and human relations schools Hawthorne Experiments
Introduction to Industrial Psychology –
Psychology: is a scientific discipline. It branched off from philosophy and has ushered as an
independent science on its own right. The definition of psychology had undergone several revisions in
the past. It is currently defined as a discipline engaged in studying behavior and mental processes. The
field of psychology is ever expanding and diversifying. Several sub fields of psychology have been
developed. The strength of psychology as a science rests on its methods. A wide variety of methods
have been eve loved by psychologists over the century. These methods help collecting data needed to
build up a reliable and valid psychology.
Rudolph Goclenius, a Greek philosopher, invented the term 'psychology' in1590. The English word
‘Psychology’ originated from the root ‘psyche’ in Greek. The root word in Greek meant ‘soul’ or ‘spirit’.
Logos in Greek meant ‘knowledge.’ Since the beginning psychology has been continuously undergoing
redefinitions. Thus psychology was conceived to be a study of soul in the ancient time. At the end of
the last century, psychology was recognized as the study of mind and consciousness through
introspection, the description of experience.
Industrial psychology: is that branch of applied psychology that is concerned with efficient
management of an industrial labour force and especially with problems encountered by workers in a
mechanized environment. The time was gone when the workers treated as machine and employers
always think about the higher production at any cost or without taking consideration of workers'.
Now, management better knows if the workers' feel ease/ comfortable then they give their maximum
contribution.
There are some other factors then wages which directly affect the performance of individuals. If
employers provide adequate working conditions, proper distribution of work, attractive
compensation, effective leader etc. then definitely organization achieves its success. In this chapter
we define the industrial psychology, their characteristics, scope and historical development.
CONCEPT AND MEANING:
Industrial psychology is concerned with people's work-related values, attitudes and behaviors, and
how these are influenced by the conditions in which they work. The term 'Industrial Psychology' is a
combination of two words 'Industrial' and 'Psychology'. Industrial is that part of social life whose
function is to provide civilized man with the material goals that his condition of life demand.
Psychology is the science of behavior in relation to environment. Thus industrial psychology is the
systematic study of the behavior of the people at work. It studies how the social, industrial, economic,
political and other factors affect the behavior of the people at work.

Definitions:
According to C.S. Myres, ‘The aim of industrial psychology is primarily not to obtain greater production
or output but to give the worker greater ease at his work’.
According to Thomas W. Harrell, ‘Industrial psychology may be defined as the study of people as
individuals and in groups and of the relationship between individual and group’.
According to Tiffin and McCormick, 'Industrial psychology is concerned with the study of human
behavior in those aspects of life that are related to production, distribution and use of goods and
services of our civilization’.
According to Blum and Naylor. ‘Industrial psychology is simply the application or extension of
psychology facts and principles to the problem concerning human beings operating within the context
of business and industry’,
According to Guion. ‘The scientific study of the relationship between man and the world at work: The
study of adjustment people make to the place they go, the people they meet and the things they do in
the process of making a living’,
1.3 CHARACTERISTICS OF INDUSTRIAL PSYCHOLOGY
● Systematic study—Industrial psychology is the systematic study of human behavior concerned with
collecting the information regarding human behavior at work. What are the different factors which
affect the work of an individual either they are personal or related to working conditions.
● Research—Industrial psychology is not concerned with administration. They are the part of the
research. Whatever information gathered from the work should be implemented and the personnel
administration is the application of such research.
● Functional/Applied—It is concerned with the application of information about human behavior to
the various problems of industrial human life.
● Human engineering—It studies the varied methods of performing manual operations for the better
utilization and the least waste of effort through human engineering.
CHARACTERISTICS OF INDUSTRIAL PSYCHOLOGY:
● Systematic study—Industrial psychology is the systematic study of human behavior concerned with
collecting the information regarding human behavior at work. What are the different factors which
affect the work of an individual either they are personal or related to working conditions.
● Research—Industrial psychology is not concerned with administration. They are the part of the
research. Whatever information gathered from the work should be implemented and the personnel
administration is the application of such research.
● Functional/Applied—It is concerned with the application of information about human behavior to
the various problems of industrial human life.

● Human engineering—It studies the varied methods of performing manual operations for the better
utilization and the least waste of effort through human engineering.
 Promoting labour welfare—It promotes the welfare of the labour by introducing adequate
working environment through which job satisfaction, work efficiency increases and also state
the provisions of higher incentives.
● Enhancement of human relations—Human relations are the relation among individuals in an
organization and the group behaviour that emerge from their relations. Most of problems arise in the
industries are connected to human relation. If workers' feel ease with the surrounding then
automatically they get motivated and productivity will be higher. Industrial psychology has made
significant contribution in framing the techniques of leadership, worker participation, communication
etc.
● Developing industrial relations—Industrial psychology studies the attitude of the employer and
employees. Individuals differ from each others in their thoughts, thinking, behaviour and other
parameters. Therefore, different measures may be adopted in solving the problem relating to each
individual like transfers, promotions, grievances etc. This helps in developing industrial relationship
among workers' and management.
● Increase production—It helps in attaining the major objective of the organization that to get the
best output from the existing resources. The production is automatically increased if proper selection
is made, the work will be properly distributed, accident prevention and safety measures suggested.
This will improve and promote individual as well as industrial relations.
American Psychologist Association, Division of Industrial Psychology,
The psychologist industry, Washington, D.C., 1959 cited seven major areas which comprised the
content area of industrial psychology. These were:
(1) Selection and testing.
(2) Management development.
(3) Counseling.
(4) Employee motivation.
(5) Human engineering.
(6) Marketing research.
(7) Public relations research.
HISTORICAL DEVELOPMENT OF INDUSTRIAL PSYCHOLOGY:
Bryan & Harter (1897) published a first paper describing the study and application of psychology to
work activities (Morse code telegraphic) coined the term “industrial psychology” by mistake.
During the First and Second World War when various industrial organizations and plants faced a
number of problems related to production, efficiency and individual employees, the help of industrial

psychologist are in great demand. At this stage, industrial psychology received a special status,
although it began in America in 1901, and England soon after.
Industrial Psychology:
The first book, “The Psychology of Industrial Efficiency”, written by Hugo Munsterberg in 1913 was
dealing with various problems faced by the industries and analysis of such problem from the
psychological point of view. During the war years, the Fatigue Research Board was organized in Great
Britain to discover the problems connected with working hours, condition of work, problems
associated with fatigue and monotony/boredom, accident and safety measures and other work
related matters.
In 1925, social psychology of industry entered into the arena of industrial psychology therefore,
interpersonal and intrapersonal relationships, theories of motivations, importance of communication
and other associated areas were investigated.
In 1917, Journal of applied psychology made its appearance and at the same time it introduced as a
subject of applied psychology.
The classical studies, started in 1927 by the famous Hawthorne group, contributed to the
development of industrial psychology in a major way. Their finding ultimately changed the trends and
approach of industrial psychology from economic to social , from the work-oriented attitude to a
workers-oriented attitude.
During the Second World War, the applied psychology research unit of the Medical Research Council
of Great Britain carried out several researches and investigations to solve many industrial and
organizational problems.
American Association of Applied Psychology, 1937 was the first asso-ciation for industrial psychology.
Major organization after the Second World War divided into two parts.
Human factor society, it was associated with the American group of applied psychology with interest
in human engineering problem. Ergono-mics society, it was British counterpart of human factor.
Society occupational psychology and ergonomics are two journals.
Considerable attention was focussed on various human relations and social problems of industry
during the later part of 1940's and in the 1950's. Problems related to supervision, group dynamics,
leadership, employees' interaction with others, employees attitude, morale, job satisfaction,
communication process and others.
In the beginning of the 1960's organizational psychology began to enter the area of industrial
psychology and as such, special emphasis was given to the organizational inputs in the industrial
situation.
The psychologists who have made valuable contributions to the development of industrial psychology
are Walter, Dill and Scott. The industrial psychology division of American Psychological Association
was established in 1945 and gave professional recognition to industrial psychology.

Though industrial psychology was a neglected branch of applied psychology in India. After the Second
World War and particularly after Independence, it got special recognition from Indian psychologists.
With the establishment of various universities, centre and institutes in India, research in industrial
psychology has been accelerated after 1950's.
In 1970's, the division of industrial psychology was renamed as the division of industrial and
organizational psychology. An eminent industrial and organizational psychologist of India Professor
Durganand Sinha (1971) has made a valuable survey of the important topics of research in industrial
psychology in India.
SCIENTIFIC MANAGEMENT:
INTRODUCTION
The Industrial Revolution and the ideas of Adam Smith had transformed the economies of the United
States and Western Europe in the 18th Century. Technology and industry might had replaced
population and agriculture as the major determinants of national strength. France, rich in population
and farmland, had once been the dominant power of Europe. It was now overshadowed by its more
industrial rival, Great Britain. And America was emerging as the industrial powerhouse whose
factories would swing the outcomes of the century's two world wars.
The factories of the early 20th Century were beginning to look like something that could be
reasonably compared to the factories of today, but appearances could be deceiving. Early mass
production methods were more efficient than the cottage industry methods of several centuries
earlier; but processes were chaotic by today's standards. Despite the fact that large-scale production
was taking place in factories that employed hundreds or thousands of employees, worker training was
minimal, and sophisticated systems of equipment maintenance, quality assurance, and production
control were still decades in the future. The improvement of efficiency in industry is one of the prime
objectives of industrial psychology. In every enterprise where goods are produced, increased
production at a lower cost has been the main consideration for growth of the enterprise. In particular
chapter first we explain the significance of scientific management and then discuss the Taylorism and
lastly explain briefly time-motion study.
SCIENTIFIC MANAGEMENT SCHOOL
Frederick Winslow Taylor devised a system he called scientific management, a form of industrial
engineering that established the organization of work as in Ford's assembly line. This discipline, along
with the industrial psychology established by others at the Hawthorne Works of Western Electric in
the 1920s, moved management theory from early time-and-motion studies to the latest total quality
control ideas. Scientific management theory arose in part from the need to increase productivity. In
the United States especially, skilled labour was in short supply at the beginning of the 20th century.
The only way to expand the productivity was to raise the efficiency of workers. Therefore, Frederick
W. Taylor, Henry Gantt, and Frank and Lillian Gilbreth devised the body of principles known as
scientific management theory.
Scientific management (also called Taylorism or the Taylor system) is a theory of management that
analyzes and synthesizes workflows, with the objective of improving labour productivity. The core
ideas of the theory were developed by Frederick Winslow Taylor in the 1880s and 1890s, and were

first published in his monographs, Shop Management (1905) and The Principles of Scientific
Management (1911) . Taylor believed that decisions based upon tradition and rules of thumb should
be replaced by precise procedures developed after careful study of an individual at work. Its
application is contingent on a high level of managerial control over employee work practices.
Taylor was a foreman for the Midvale Steel Company in Philadelphia from 1878 to 1890. Early in his
management career, Taylor observed that the workers under his supervision engaged in soldiering—
the practice of deliberately working slower than one's capabilities. Because the management of
Midvale Steel had little real knowledge about the jobs performed in the plant, the practice went
mostly undetected.
Taylor (1986–1915) rested his philosophy on four basic principles.
1.The development of a true science of management instead of rule of thumb so that the best method
for performing each task could be determined.
2.The scientific selection of workers so that each worker's would be given responsibility for the task
for which he or she was best suited.
3.The scientific education and development of workers.
4.Intimate friendly cooperation between management and labour.
Taylor contended that the success of these principles require “a complete mental revolution” on the
part of management and labour. Rather than quarrel over profits both side should increase
production, by so doing, he believed profits would rise to such an extent that labour have to fight over
them. Employers to pay more productive workers higher rate than others. Using a “scientifically
correct” rate that would benefit both the company and workers. Thus the workers were urged to
surpass their previous performance standards to earn more pay. Taylor called his plan the differential
rate system. Taylor believed that management and labour had common interest in increasing
productivity.
The Human Relations school: of management started focusing on the humans working on the
tasks. This aimed at increasing the work productivity through collaboration and it saw work as a group
activity. This approach also used the most popular Maslow’s hierarchy of needs which stated that
every human being has some needs which affects his performance and motivation. These needs in the
order from the most basic are Physiological needs, Safety needs, Social needs, Esteem needs and Self-actualization
needs.
Elton Mayo (1880 – 1949) believed that workers are not just concerned with money but could be
better motivated by having their social needs met whilst at work (something that Taylor ignored). He
introduced the Human Relation School of thought, which focused on managers taking more of an
interest in the workers, treating them as people who have worthwhile opinions and realising that
workers enjoy interacting together.
Mayo conducted a series of experiments at the Hawthorne factory of the Western Electric Company in
Chicago

He isolated two groups of women workers and studied the effect on their productivity levels of
changing factors such as lighting and working conditions.
He expected to see productivity levels decline as lighting or other conditions became progressively
worse
What he actually discovered surprised him: whatever the change in lighting or working conditions, the
productivity levels of the workers improved or remained the same.
From this Mayo concluded that workers are best motivated by:
Better communication between managers and workers ( Hawthorne workers were consulted over the
experiments and also had the opportunity to give feedback)
Greater manager involvement in employees working lives ( Hawthorne workers responded to the
increased level of attention they were receiving)
Working in groups or teams. ( Hawthorne workers did not previously regularly work in teams)
In practice therefore businesses should re-organise production to encourage greater use of team
working and introduce personnel departments to encourage greater manager involvement in looking
after employees’ interests. His theory most closely fits in with a paternalistic style of management
Hawthorn studies: The Hawthorne studies were carried out by the Western Electric
company at their Hawthorne plant in the 1920's. Initially, the study focused on lighting.
George Elton Mayo was in charge of certain experiments on human behavior carried out at
the Hawthorne Works of the General Electric Company in Chicago between 1924 and 1927.
His research findings have contributed to organization development in terms of human
relations and motivation theory.

Hawthorn effect:
The Hawthorne effect (also referred to as
the observer effect) refers to a
phenomenon whereby workers improve or
modify an aspect of their behavior in
response to the fact of change in their
environment, rather than in response to
the nature of the change itself. The
"Hawthorne effect" study suggested that
the novelty of having research conducted
and the increased attention from such
could lead to temporary increases in
productivity.
Hawthorn Experiments:
Part I - Illumination Experiments (1924-27)
These experiments were performed to find out the effect of different levels of illumination (lighting)
on productivity of labour. The brightness of the light was increased and decreased to find out the
effect on the productivity of the test group. Surprisingly, the productivity increased even when the
level of illumination was decreased. It was concluded that factors other than light were also
important.
Part II - Relay Assembly Test Room Study (1927-1929)
Under these test two small groups of six female telephone relay assemblers were selected. Each group
was kept in separate rooms. From time to time, changes were made in working hours, rest periods,
lunch breaks, etc. They were allowed to choose their own rest periods and to give suggestions. Output
increased in both the control rooms. It was concluded that social relationship among workers,
participation in decision-making, etc. had a greater effect on productivity than working conditions.
Part III - Mass Interviewing Programme (1928-1930)
21,000 employees were interviewed over a period of three years to find out reasons for increased
productivity. It was concluded that productivity can be increased if workers are allowed to talk freely
about matters that are important to them.
Part IV - Bank Wiring Observation Room Experiment (1932)
A group of 14 male workers in the bank wiring room were placed under observation for six months. A
worker's pay depended on the performance of the group as a whole. The researchers thought that the
efficient workers would put pressure on the less efficient workers to complete the work. However, it
was found that the group established its own standards of output, and social pressure was used to
achieve the standards of output.

Conclusions of Hawthorne Studies / Experiments:
The conclusions derived from the Hawthorne Studies were as follows :-
 The social and psychological factors are responsible for workers' productivity and job
satisfaction. Only good physical working conditions are not enough to increase productivity.
 The informal relations among workers influence the workers' behaviour and performance
more than the formal relations in the organisation.
 Employees will perform better if they are allowed to participate in decision-making affecting
their interests.
 Employees will also work more efficiently, when they believe that the management is
interested in their welfare.
 When employees are treated with respect and dignity, their performance will improve.
 Financial incentives alone cannot increase the performance. Social and Psychological needs
must also be satisfied in order to increase productivity.
 Good communication between the superiors and subordinates can improve the relations and
the productivity of the subordinates.
 Special attention and freedom to express their views will improve the performance of the
workers.
Criticism of Hawthorne Studies / Experiments:
The Hawthorne Experiments are mainly criticised on the following grounds :-
 Lacks Validity : The Hawthorne experiments were conducted under controlled situations.
These findings will not work in real setting. The workers under observation knew about the
experiments. Therefore, they may have improved their performance only for the
experiments.
 More Importance to Human Aspects : The Hawthorne experiments gives too much
importance to human aspects. Human aspects alone cannot improve production. Production
also depends on technological and other factors.
 More Emphasis on Group Decision-making : The Hawthorne experiments placed too much
emphasis on group decision-making. In real situation, individual decision-making cannot be
totally neglected especially when quick decisions are required and there is no time to consult
others.
 Over Importance to Freedom of Workers : The Hawthorne experiments gives a lot of
importance to freedom of the workers. It does not give importance to the constructive role of
the supervisors. In reality too much of freedom to the workers can lower down their
performance or productivity.

Unit-II
Focus Areas: Individual in Workplace Motivation and Job satisfaction , stress management. Organizational
culture, Leadership & group dynamics.
Motivation:
Motivation is a process that starts with a physiological or psychological need that activates a behavior
or a drive that is aimed at a goal.
Every employee is expected to show increased and qualitative productivity by the manager. To achieve
this the behavior of the employee is very important. The behavior of the employees is influenced by the
environment in which they find themselves. Finally, an employee's behavior will be a function of that
employee's innate drives or felt needs and the opportunities he or she has to satisfy those drives or
needs in the workplace.
Motivation may be defined as a process of stimulating people to action , to accomplish desired goal.
Definitions
According to Dalton E. Mcfarland ―Motivation refers to the way in which urges, drives, desires,
aspirations, striving or needs directs, control or explain the behvior of human beings‖.
―Motivation is the act of stimulating someone or oneself to get desired course of action, to push right
button to get desired reactions.‖
Features of motivation :
 Motivation is an act of managers
 Motivation is a continuous process
 Motivation can be positive or negative
 Motivation is goal oriented
 Motivation is complex in nature
 Motivation is an art
 Motivation is system-oriented
 Motivation is different from job satisfaction
MOTIVATIONAL FACTORS
There are several factors that motivate a person to work. The motivational factors can be broadly
divided into two groups:
I. MONETARY FACTORS: Salaries or wages:
Salaries or wages is one of the most important motivational factors. Reasonable salaries must be paid
on time. While fixing salaries the organization must consider such as :Cost of living , Company ability
to pay

,Capability of company to pay etc,
Bonus:
It refers to extra payment to employee over and above salary given as an incentive. The employees
must be given adequate rate of bonus.
Incentives:
The organization may also provide additional incentives such as medical allowance, educational
allowance, hra ,allowance, etc.
Special individual incentives:
The company may provide special individual incentives. Such incentives are to be given to deserving
employees for giving valuable suggestions.
II. NON MONETARY FACTORS:
Status or job title: By providing a higher status or designations the employee must be motivated.
Employees prefer and proud of higher designations.
Appreciation and recognition: Employees must be appreciated for their services. The praise should
not come from immediate superior but also from higher authorities.
Delegation of authority: Delegation of authority motivates a subordinate to perform the tasks with
dedication and commitment. When authority is delegated, the subordinate knows that his superior has
placed faith and trust in him.
Working conditions : Provision for better working conditions such as air-conditioned rooms, proper
plant layout, proper sanitation, equipment, machines etc, motivates the employees.
Job security: Guarantee of job security or lack of fear dismissal, etc can also be a good way to
motivate the employees. Employees who are kept temporarily for a long time may be frustrated and
may leave the organization.
Job enrichment: Job enrichment involves more challenging tasks and responsibilities. For instance an
executive who is involved in preparing and presenting reports of performance, may also asked to frame
plans.
Workers participation: Inviting the employee to be a member of quality circle, or a committee, or
some other form of employee participation can also motivate the work-force.
Cordial relations: Good and healthy relations must exist throughout the organization. This would
definitely motivates the employees.

Good superiors: Subordinates want their superiors to be intelligent, experienced, matured, and having a
good personality. In fact, the superior needs to have superior knowledge and skills than that of his
subordinates. The very presence of superiors can motivate the subordinates.
Other factors: There are several other factors of motivating the employees:
 Providing training to the employees.
 Proper job placements.
 Proper promotions and transfers.
 Proper performance feed back.
 Proper welfare facilities.
 Flexible working hours.
Need and importance of motivation: Motivation offers several importance to he organization and to the
employees:
 Higher efficiency
 Reduce absenteeism.
 Reduces employee turn over.
 Improves a corporate image.
 Good relations.
 Improved morale.
 Reduced wastages and breakages.
 Reduced accidents.
 Facilitates initiative and innovation.
Money as a motivator:
It is normally believed that money acts as a motivator. In general the role of money as a motivator depends
upon certain factors:
Money fails to motivate people, when there is no direct relationship between reward and effort.
Economic conditions of people influence the Importance of money. For poor person, the value of certain
amount of money is quite high as compared to rich.
Industrial Psychology By Pawan Kumar Tripathi Email. Pawantripathi42@gmail.comPage
15

Money is a significant motivator at lower level of employees level however money may not be a significant
factor for senior executives who have already fulfilled their lower level needs.
Employees are concerned not only wih the amount of money paid to them, but it should be fair and
equitable as paid to that of othe employees of same level or status.
Social attitudes towards money and wealth also decides the motivation to earn more and more.
Process of Motivation:
Motivational Theories:
16

Maslow’s-Hierarchy of Needs Theory:
This theory was proposed by Abraham Maslow
and is based on the assumption that people are
motivated by a series of five universal needs.
These needs are ranked, according to the order in
which they influence human behavior, in
hierarchical fashion
Physiological needs are deemed to be the
lowest- level needs. These needs include the
needs such as food & water sex.
So long as physiological needs are unsatisfied,
they exist as a driving or motivating force in a
person's life. A hungry person has a felt need.
This felt need sets up both psychological and
physical tensions that manifest themselves in
overt behaviors directed at reducing those tensions (getting something to eat). Once the hunger is sated, the
tension is reduced, and the need for food ceases to motivate. At this point (assuming that other
physiological requirements are also satisfied) the next higher order need becomes the motivating need.
Thus, safety needs -- the needs for shelter and security -- become the motivators of human behavior.
Safety needs include a desire for security, stability, dependency, protection, freedom from fear and anxiety,
and a need for structure, order, and law.. In the workplace this needs translates into a need for at least a
minimal degree of employment security; the knowledge that we cannot be fired on a whim and that
appropriate levels of effort and productivity will ensure continued employment.
Social needs include the need for belongingness and love. Generally, as gregarious creatures, human have
a need to belong. In the workplace, this need may be satisfied by an ability to interact with one's coworkers
and perhaps to be able to work collaboratively with these colleagues.
After social needs have been satisfied, ego and esteem needs become the motivating needs.
Esteem needs include the desire for self-respect, self-esteem, and the esteem of others. When focused
externally, these needs also include the desire for reputation, prestige, status, fame, glory, dominance,
recognition, attention, importance, and appreciation.
Self-actualization: The highest need in Maslow's hierarchy is that of self-actualization; the need for self-realization,
continuous self-development, and the process of becoming all that a person is capable of
becoming.
Two-factor Theory:
Herzberg's Two Factor Theory, also known as the Motivation-
Hygiene Theory, was derived from a study designed to test
the concept that people have two sets of needs:
Their needs as animals to avoid pain their needs as humans to
grow psychologically Herzberg‘ study
Herzberg's study consisted of a series of interviews that
sought to elicit responses to the questions:
Recall a time when you felt exceptionally good about your
job. Why did you feel that way about the job? Did this feeling
affect your job performance in any way? Did this feeling have
17

an impact on your personal relationships or your well- being?
Recall a time on the job that resulted in negative feelings? Describe the sequence of events that resulted in
these negative feelings.
Research Resultlts : it appeared from the research, that the things making people happy on the job and those
making them unhappy had two separate themes.
1)SATISFACTION (MOTIVATION): Five factors stood out as strong determiners of job satisfaction:
 achievement
 recognition
 work itself
 responsibility
 advancement
The last three factors were found to be most important for bringing about lasting changes of attitude. It
should be noted, that recognition refers to recognition for achievement as opposed to recognition in the
human relations sense.
2)DISSATISFACTION (HYGIENE): The determinants of job dissatisfaction were found to be:
 company policy
 administrative policies
 supervision
 salary
 interpersonal relations
 working conditions
From the results Herzberg concluded that the replies people gave when they felt good about their jobs were
significantly different from the replies given when they felt bad. Certain characteristics tend to be
consistently related to job satisfaction and others to job dissatisfaction. Intrinsic factors, such as work itself
, responsibility and achievement seem to be related to job satisfaction. Respondents who felt good about
their work tended to attribute these factors to themselves. On the other dissatisfied respondents tended to
cite extrinsic factors such as supervision, pay, company policies and working condition. Herzberg proposed
that his findings indicated the existence of a dual continuum: the opposite of ―satisfaction‖ is ― No
satisfaction‖ and the opposite of ―Dissatisfaction‖ is ―No Dissatisfaction.
According to Herzberg, the factors leading to Job satisfaction are separate and distinct form those that lead
to job dissatisfaction. Therefore, managers who seek to eliminate factors that can create job dissatisfaction
may bring about peace but not necessarily motivation. They will be placating their workforce rather than
motivating them. As a result, conditions surrounding the job such as quality of supervision, pay , company
policies, physical working conditions relations with others and job security were characterized by Herzberg
as hygiene factors, when they‘re adequate, people will not be dissatisfied ; neither will they be satisfied.
18

we want to motivate people on their jobs, Herzberg suggested emphasizing factors associated with the work
itself or to outcomes directly derived form it, such as promotional opportunities, opportunities for personal
growth, recognition, responsibility and achievement. These are the characteristics that people find
intrinsically rewarding.
Alderfer's Hierarchy of Motivational Needs : Clayton Alderfer reworked Maslow's Need Hierarchy to
align it more closely with empirical research. Alderfer's theory is called the ERG theory -- Existence,
Relatedness, and Growth.
Existence refers to our concern with basic material existence requirements; what Maslow called
physiological and safety needs.
Relatedness refers to the desire we have for maintaining interpersonal relationships; similar to Maslow's
social/love need, and the external component of his esteem need.
Growth refers to an intrinsic desire for personal development; the intrinsic component of Maslow's esteem
need, and self-actualization
Alderfer's ERG theory differs from Maslow's Need Hierarchy insofar as ERG theory demonstrates that
more than one need may be operative at the same time. ERG theory does not assume a rigid hierarchy
where a lower need must be substantially satisfied before one can move on.
19

Alderfer also deals with frustration-regression. That is, if a higher-order need is frustrated, an individual
then seeks to increase the satisfaction of a lower-order need.
According to Maslow an individual would stay at a certain need level until that need was satisfied. ERG
theory counters by noting that when a higher- order need level is frustrated the individual‘s desire to
increase a lower- level need takes place. Inability to satisfy a need for social interaction, for instance,
might increase the desire for more money or better working conditions. So frustration can lead to a
regression to a lower need.
In summary, ERG theory argues, like Maslow, that satisfied lower- order needs lead to the desire to satisfy
higher-order needs; but multiple needs can be operating as motivators at the same time, and frustration in
attempting to satisfy a higher- level need can result in regression to a lower- level need.
Alderfer's Hierarchy of Motivational Needs
Level of Need Definition Properties
Impel a person to make
Satisfied through using
capabilities in engaging
Growth
creative or productive problems; creates a
effects on himself and his greater sense of
environment wholeness and fullness as
a human being
Satisfied by mutually
Involve relationships with
sharing thoughts and
Relatedness
feelings; acceptance,
significant others confirmation, under-standing,
and influence
are elements
Includes all of the various When divided among
Existence forms of material and
people one person's gain
is another's loss if
psychological desires
resources are limited
20

McClelland’s Theory of Needs: According to David
McClelland, regardless of culture or gender, people are driven by
three motives:
 Need for achievement,
 Need for affiliation, and
 Need for influence.
Since McClelland's first experiments, over 1,000 studies relevant to
achievement motivation have been conducted. These studies
strongly support the theory.
Achievement : The need for achievement is characterized by the wish to take responsibility for finding
solutions to problems, master complex tasks, set goals, get feedback on level of success.
Affiliation : The need for affiliation is characterized by a desire to belong, an enjoyment of teamwork, a
concern about interpersonal relationships, and a need to reduce uncertainty.
Power :The need for power is characterized by a drive to control and influence others, a need to win
arguments, a need to persuade and prevail
According to McClelland, the presence of these motives or drives in an individual indicates a
predisposition to behave in certain ways. Therefore, from a manager's perspective, recognizing which need
is dominant in any particular individual affects the way in which that person can be motivated.
A comparative analysis of all 4 need base theories:
Maslow Herzberg Alderfer McClelland
Need for power
90
A Graphic Comparison of Four Content
Approaches to Motivation
Self-actualization
Esteem
Belongingness,
social, and love
Safety and
security
Physiological
The work itself
- Responsibility
-Advancement
- Growth
Achievement
Recognition
Quality of inter-personal
relations
among peers, with
supervisors
Job security
Salary
Growth
Relatedness
Existence
Need for
achievement
Need for
affiliation
Motivators
Hygiene
conditions
Higher
order needs
Basic
needs
21

Expectancy Theory : MF= Expectancy x Instrumentality x Valance
In recent years, probably the most popular motivational theory has been the Expectancy Theory (also
known as the Valence- Instrumentality- Expectancy Theory). Although there are a number of theories
found with this general title, they all have their roots in Victor Vroom's 1964 work on motivation.
ALTERNATIVES AND CHOICES:
Vroom's theory assumes that behavior results from conscious choices among alternatives whose purpose it
is to maximize pleasure and minimize pain. The key elements to this theory are referred to as Expectancy
(E), Instrumentality (I), and Valence (V) . Critical to the understanding of the theory is the understanding
that each of these factors represents a belief.
Vroom's theory suggests that the individual will consider the outcomes associated with various levels of
performance (from an entire spectrum of performance possibilities), and elect to pursue the level that
generates the greatest reward for him or her.
Expectancy: "What's the probability that, if I work very hard, I'll be able to do a good job?"
Expectancy refers to the strength of a person's belief about whether or not a particular job performance is
attainable. Assuming all other things are equal, an employee will be motivated to try a task, if he or she
believes that it can be done. This expectancy of performance may be thought of in terms of probabilities
ranging from zero (a case of "I can't do it!") to 1.0 ("I have no doubt whatsoever that I can do this job!")
A number of factors can contribute to an employee's expectancy perceptions:
the level of confidence in the skills required for the task
the amount of support that may be expected from superiors and subordinates
the quality of the materials and equipment
the availability of pertinent information
Previous success at the task has also been shown to strengthen expectancy beliefs.
Instrumentality: "What's the probability that, if I do a good job, that there will be some kind of outcome in
it for me?"
22

If an employee believes that a high level of performance will be instrumental for the acquisition of
outcomes which may be gratifying, then the employee will place a high value on performing well. Vroom
defines Instrumentality as a probability belief
23

linking one outcome (a high level of performance, for example) to another outcome (a reward).
Instrumentality may range from a probability of 1.0 (meaning that the attainment of the second outcome --
the reward -- is certain if the first outcome -- excellent job performance -- is attained) through zero
(meaning there is no likely relationship between the first outcome and the second). An example of zero
instrumentality would be exam grades that were distributed randomly (as opposed to be awarded on the
basis of excellent exam performance) . Commission pay schemes are designed to make employees perceive
that performance is positively instrumental for the acquisition of money.
For management to ensure high levels of performance, it must tie desired outcomes (positive valence) to
high performance, and ensure that the connection is communicated to employees.
The VIE theory holds that people have preferences among various outcomes. These preferences tend to
reflect a person's underlying need state.
Valence: "Is the outcome I get of any value to me?"
The term Valence refers to the emotional orientations people hold with respect to outcomes (rewards). An
outcome is positively valent if an employee would prefer having it to not having it. An outcome that the
employee would rather avoid ( fatigue, stress, noise, layoffs) is negatively valent. Outcomes towards which
the employee appears indifferent are said to have zero valence.
Valences refer to the level of satisfaction people expect to get from the outcome (as opposed to the actual
satisfaction they get once they have attained the reward).
Vroom suggests that an employee's beliefs about Expectancy, Instrumentality, and Valence interact
psychologically to create a motivational force such that the employee acts in ways that bring pleasure and
avoid pain.
People elect to pursue levels of job performance that they believe will maximize their overall best interests
(their subjective expected utility).`
There will be no motivational forces acting on an employee if any of these three conditions hold:
the person does not believe that he/she can successfully perform the required task
the person believes that successful task performance will not be associated with positively valent outcomes
the person believes that outcomes associated with successful task completion will be negatively valent
(have no value for that person).
Equity theory: This theory of
motivation centres around the principle of
balance or equity. According to this
theory level of motivation in an individual
is related to his or her perception of
equity and farness practiced by
management. Greater the fairness
perceived higher the motivation and vice
versa. In this assessment of fairness,
employee makes comparison of input in
the job ( in terms of contribution) with
that of outcome (in terms of
compensation) and compares the same
with that of another colleague of
equivalent cadre.
24

Theory of “X” and Theory of “Y”:
Douglas McGregor observed two diametrically
opposing view points of managers about their
employees, one is negative called ―Theory of
X‖ and one is positive called ―Theory of Y‖
Theory of X : Following are the assumptions of
managers who believe in the ―Theory of X‖ in
regard to their employees.
Employees dislike work; if possible avoid the
same
Employees must be coerced, controlled or threatened to do the work
Employees avoid responsibilities and seek formal direction
Most employees consider security of job, most important of all other factors in the job and have very little ambition
Theory of Y: Following are the assumptions of managers who believe in the ―Theory of Y‖ in regard to their
employees.
Employees love work as play or rest
Employees are self directed and self controlled and committed to the organizational objectives
Employees accept and seek responsibilities
Innovative spirit is not confined to managers alone, some employees also possess it.
Theory of X assumes Maslow‘s lower level needs dominate in employees. Whereas Theory of Y, assumes Maslow‘s
higher level needs dominate in employees.
Goal Setting Theory : Edwin Locke proposed that
setting specific goals will improve motivation. Salient
features of this theory are the following:
• Specific goal fixes the needs of resources and
efforts
• It increases performance
• Difficult goals result higher performance than easy
job
• Better feedback of results leads to better to better
performance than lack of feed back.

• Participation of employees in goal has mixed result
• Participation of setting goal, however, increases acceptance of goal and involvements.
• Goal setting theory has identified two factors which influences the performance. These are given below;
Theory of Z
Theory Z is a name applied to three distinctly different psychological theories. One was developed by Abraham H.
Maslow in his paper Theory Z and the other is Dr. William Ouchi's so-called "Japanese Management" style
popularized during the Asian economic boom of the 1980s. The third was developed by W. J. Reddin in Managerial
Effectiveness (19 Situation guides) man:
Reason motivates him.
Interdependence is man's primary mode of discourse.
Interaction is man's social unit of importance.
"Objective" best and succinctly describes man's concept of man.
McGregor's Theory Y in contrast to Theory X, which stated that workers inherently dislike and avoid work and must
be driven to it, and Theory Y, which stated that work is natural and can be a source of satisfaction when aimed at
higher order human psychological needs.
For Ouchi, Theory Z focused on increasing employee loyalty to the company by providing a job for life with a
strong focus on the well-being of the employee, both on and off the job. According toOuchi, Theory Z management
tends to promote stable employment, high productivity, and high employee morale and satisfaction.
Ironically, "Japanese Management" and Theory Z itself were based on Dr. W. Edwards Deming's famous "14
points". Deming, an American scholar whose management and motivation theories were rejected in the United
States, went on to help lay the foundation of Japanese organizational development during their expansion in the
world economy in the 1980s. Deming's theories are summarized in his two books, Out of the Crisis and The New
Economics, in which he spells out his "System of Profound Knowledge". He was a frequent advisor to Japanese
business and government leaders, and eventually became a revered counselor. Deming was awarded the Second
Order of the Sacred Treasures by the former Emperor Hirohito, and American businesses ultimately tried
unsuccessfully to use his "Japanese" approach to improve their competitive position.
Gist of the theory of Z:
Professor Ouchi spent years researching Japanese companies and examining American companies using the Theory
Z management styles.
By the 1980‘s, Japan was known for the highest productivity anywhere in the world, while America had fallen
drastically.
The word "Wa" in Japanese can be applied to Theory Z because they both deal with promoting partnerships and
group work.
The word "Wa" means a perfect circle or harmony, which influences Japanese society to always be in teams and to
come to a solution together.
Promoting Theory Z and the Japanese word "Wa" is how the Japanese economy became so powerful.
And also because the Japanese show a high level enthusiasm to work,some of the researchers claim that 'Z' in the
theory Z stands for 'Zeal'.
Reinforcement theory
Reinforcement theory of motivation was proposed by BF Skinner and his associates. It states that individual‘s
behaviour is a function of its consequences. It is based on ―law of effect‖, i.e, individual‘s behaviour with positive
consequences tends to be repeated, but individual‘s behaviour with negative consequences tends not to be repeated.
Reinforcement theory of motivation overlooks the internal state of individual, i.e., the inner feelings and drives of
individuals are ignored by Skinner. This theory focuses totally on what happens to an individual when he takes some
action. Thus, according to Skinner, the external environment of the organization must be designed effectively and
positively so as to motivate the employee. This theory is a strong tool for analyzing controlling mechanism for
individual‘s behaviour. However, it does not focus on the causes of individual‘s behaviour.

Types of reinforcement
The managers use the following methods for
controlling the behaviour of the employees:
Positive Reinforcement.
Negative Reinforcement.
Punishment.
Extinction.
Positive Reinforcement- This implies giving a positive
response when an individual shows positive and
required behaviour. For example - Immediately praising
an employee for coming early for job. This will
increase probability of outstanding behaviour occurring
again. Reward is a positive reinforce, but not necessarily. If and only if the employees‘ behaviour improves, reward
can said to be a positive reinforcer. Positive reinforcement stimulates occurrence of a behaviour. It must be noted
that more spontaneous is the giving of reward, the greater reinforcement value it has.
Negative Reinforcement-
This implies rewarding an employee by removing negative / undesirable consequences. Both positive and negative
reinforcement can be used for increasing desirable / required behaviour.
Punishment-
It implies removing positive consequences so as to lower the probability of repeating undesirable behaviour in
future. In other words, punishment means applying undesirable consequence for showing undesirable behaviour. For
instance - Suspending an employee for breaking the organizational rules. Punishment can be equalized by positive
reinforcement from alternative source.
Extinction- It implies absence of reinforcements. In other words, extinction implies lowering the probability of
undesired behaviour by removing reward for that kind of behaviour. For instance - if an employee no longer receives
praise and admiration for his good work, he may feel that his behaviour is generating no fruitful consequence.
Extinction may unintentionally lower desirable behaviour.
Implications of Reinforcement Theory
Reinforcement theory explains in detail how an individual learns behaviour. Managers who are making attempt to
motivate the employees must ensure that they do not reward all employees simultaneously. They must tell the
employees what they are not doing correct. They must tell the employees how they can achieve positive
reinforcement.
Stress Management:
Introduction
Stress is a fact of life, wherever you are and whatever you are doing. You cannot avoidstress, but you can learn to
manage it so it doesn‘t manage you. Changes in our lives—such as going to college, getting married, changing jobs,
or illness—are frequent sources of stress. Keep in mind that changes that cause stress can also benefit you. Moving
away from home to attend college, for example, creates personal-development opportunities—new challenges,
friends, and living arrangements. That is why it‘s important to know yourself and carefully consider the causes of
stress. Learning to do this takes time, and although you cannot avoid stress, the good news is that you can minimize
the harmful effects of stress, such as depression or hypertension. The key is to develop an awareness of how you
interpret, and react to, circumstances. This awareness will help you develop coping techniques for managing stress.
Defining Stress
Stress is the way human beings react both physically and mentally to changes, events, andsituations in their lives.
People experience stress in different ways and for different reasons. The reaction is based on your perception of an
event or situation. If you view a situation negatively, you will likely feel distressed—overwhelmed, oppressed, or
out of control. Distress is the more familiar form of stress. The other form, eustress, results from a ―positive‖ view

of an event or situation, which is why it is also called ―good stress.‖ Eustress helps you rise to a challenge and can
be an antidote to boredom because it engages focused energy. That energy can easily turn to distress, however, if
something causes you to view the situation as unmanageable or out of control. Many people regard public speaking
or airplane flights as very stressful—causing physical reactions such as an increased heart rate and a loss of
appetite—while others look forward to the event. It‘s often a question of perception: A positive stressor for one
person can be a negative stressor for another.
Causes of Stress
The most frequent reasons for ―stressing out‖ fall into three main categories:
1. The unsettling effects of change
2. The feeling that an outside force is challenging or threatening you
3. The feeling that you have lost personal control.
Life events such as marriage, changing jobs, divorce, or the death of a relative or friend are the most common causes
of stress. Although life-threatening events are less common, they can be the most physiologically and
psychologically acute. They are usually associated with public service career fields in which people experience
intense stress levels because of imminent danger and a high degree of uncertainty—police officer, fire and rescue
worker, emergency relief worker, and the military. You may not plan to enter a high-stress career, but as a college
student, you may find that the demands of college life can create stressful situations. The National Institute of
Mental Health (NIMH) notes some of the more common stressors for college students:
• Increased academic demands
• Being on your own in a new environment
• Changes in family relations
• Financial responsibilities
• Changes in your social life
• Exposure to new people, ideas, and temptations
• Awareness of your sexual identity and orientation
• Preparing for life after graduation.
Symptoms of Distress
Symptoms of stress fall into three general, but interrelated, categories—physical, mental, and emotional. Review this
list carefully. If you find yourself frequently experiencing these symptoms, you are likely feeling distressed:
• Headaches
• Fatigue
• Gastrointestinal problems
• Hypertension (high blood pressure)
• Heart problems, such as palpitations
• Inability to focus/lack of concentration
• Sleep disturbances, whether it‘s sleeping too much or an inability to sleep
• Sweating palms/shaking hands
• Anxiety
• Sexual problems.
Even when you don‘t realize it, stress can cause or contribute to serious physical disorders. It increases hormones
such as adrenaline and corticosterone, which affect your metabolism, immune reactions, and other stress responses.
That can lead to increases in your heart rate, respiration, blood pressure, and physical demands on your internal
organs.
Behavioral changes are also expressions of stress. They can include:
• Irritability
• Disruptive eating patterns (overeating or under eating)
• Harsh treatment of others
• Increased smoking or alcohol consumption
Managing Stress
As noted in the Introduction, you can learn to manage stress. The first step is understanding yourself better—how
you react in different situations, what causes you stress, and how you behave when you feel stressed. Once you‘ve
done that, take the following steps:

 Set priorities. Use the time-management tips you learned in Section 1. Make a To-Dolist. Decide what is
really important to get done today, and what can wait. This helps you to know that you are working on your
most immediate priorities, and you don‘thave the stress of trying to remember what you should be doing.
Practice facing stressful moments. Think about the event or situation you expect to face and rehearse your
reactions. Find ways to practice dealing with the challenge. If you know that speaking in front of a group
frightens you, practice doing it, perhapsfreeze up, buy some practice tests at the school bookstore or online
and work with them when there are no time pressures.
 Examine your expectations. Try to set realistic goals. It‘s good to push yourself to achieve, but make sure
your expectations are realistic. Watch out for perfectionism. Be satisfied with doing the best you can.
Nobody‘s perfect—not you, not your fellow Cadet, nobody. Allow people the liberty to make mistakes, and
remember that mistakes can be a good teacher.
 Live a healthy lifestyle. Get plenty of exercise. Eat healthy foods. Allow time for rest and relaxation. Find a
relaxation technique that works for you—prayer, yoga, meditation, or breathing exercises. Look for the
humor in life, and enjoy yourself.
 Learn to accept change as a part of life. Nothing stays the same. Develop a support system of friends and
relatives you can talk to when needed. Believe in yourself and your potential. Remember that many people
from disadvantaged backgrounds have gone on to enjoy great success in life. At the same time, avoid those
activities that promise release from stress while actually adding to it. Drinking alcohol (despite what all
those TV commercials imply), drinking caffeine, smoking, using narcotics (including marijuana), and
overeating all add to the body‘s stress in addition to their other harmful effects.
Here are some other strategies for dealing with stress:
• Schedule time for vacation, breaks in your routine, hobbies, and fun activities.
• Try to arrange for uninterrupted time to accomplish tasks that need your concentration. Arrange some leisure time
during which you can do things that youreally enjoy.
• Avoid scheduling too many appointments, meetings, and classes back-to-back. Allow breaks to catch your breath.
Take a few slow, deep breaths whenever you feel stressed. Breathe from the abdomen and, as you exhale, silently
say to yourself, ―I feel calm.‖
• Become an expert at managing your time. Read books, view videos, and attend seminars on time management.
Once you cut down on time wasters, you‘ll find more time to recharge yourself.
• Learn to say ―no.‖ Setting limits can minimize stress. Spend time on your main responsibilities and priorities rather
than allowing other people‘s priorities or needs to dictate how you spend your time.
• Exercise regularly to reduce muscle tension and promote a sense of well-being.
• Tap into your support network. Family, friends, and social groups can help when dealing with stressful events.
Organizational culture:
Organizational culture is the behavior of humans within an organization and the meaning that people attach to those
behaviors. Culture includes the organization's vision, values, norms, systems, symbols, language, assumptions,
beliefs, and habits. It is also the pattern of such collective behaviors and assumptions that are taught to new
organizational members as a way of perceiving, and even thinking and feeling. Organizational culture affects the
way people and groups interact with each other, with clients, and with stakeholders.
Ravasi and Schultz (2006) stated that organizational culture is a set of shared mental assumptions that guide
interpretation and action in organizations by defining appropriate behavior for various situations. Although a
company may have its "own unique culture", in larger organizations there are sometimes conflicting cultures that co-exist
owing to the characteristics of different management teams. Organizational culture may affect employees'
identification with an organization.
Schein (1992), Deal and Kennedy (2000), and Kotter (1992) advanced the idea that organizations often have very
differing cultures as well as subcultures.
According to Needle (2004),organizational culture represents the collective values, beliefs and principles of
organizational members and is a product of such factors as history, product, market, technology, and strategy, type

of employees, management style, and national culture. Corporate culture on the other hand refers to those cultures
deliberately created by management to achieve specific strategic ends.
Factors affecting organization culture:
Gerry Johnson (1988) described a cultural web, identifying a number of elements that can be used to describe or
influence organizational culture:
 The paradigm: What the organization is about, what it does, its mission, its values.
 Control systems: The processes in place to monitor what is going on. Role cultures would have vast
rulebooks. There would be more reliance on individualism in a power culture.
 Organizational structures: Reporting lines, hierarchies, and the way that work flows through the business.
 Power structures: Who makes the decisions, how widely spread is power, and on what is power based?
 Symbols: These include organizational logos and designs, but also extend to symbols of power such as
parking spaces and executive washrooms.
 Rituals and routines: Management meetings, board reports and so on may become more habitual than
necessary.
 Stories and myths: build up about people and events, and convey a message about what is valued within the
organization.
Types of culture:
Charles Handy (1976), popularized Roger Harrison (1972) with linking organizational structure to organizational
culture. The described four types of culture are:
 Power culture: concentrates power among a small group or a central figure and its control is radiating
from its center like a web. Power cultures need only a few rules and little bureaucracy but swift in decisions
can ensue.
 Role culture: authorities are delegated as such within a highly defined structure. These organizations form
hierarchical bureaucracies, where power derives from the personal position and rarely from an expert
power. Control is made by procedures (which are highly valued), strict roles descriptions and authority
definitions. These organizations have consistent systems and are very predictable. This culture is often
represented by a "Roman Building" having pillars. These pillars represent the functional departments.
 Task culture: teams are formed to solve particular problems. Power is derived from the team with the
expertise to execute against a task. This culture uses a small team approach, where people are highly skilled
and specialized in their own area of expertise. Additionally, these cultures often feature the multiple
reporting lines seen in a matrix structure.
 Person culture: formed where all individuals believe themselves superior to the organization. It can
become difficult for such organizations to continue to operate, since the concept of an organization
suggests that a group of like-minded individuals pursue organizational goals. However some professional
partnerships operate well as person cultures, because each partner brings a particular expertise and clientele
to the firm.

Leadership:
Definition of leadership
According to Harry Truman ―Leadership is the ability to get other people do what they don‘t want to do or like it‖
According to Chester Bernard ―Leadership is the ability of a superior to influence the behavior of his subordinate
and persuade them to follow a particular course of action ‖
According to Koontz and O’Donnel ―Leadership is the ability of a manger to induce subordinates to work with
confidence and zeal‖
According to George R. Terry ―Leadership is the activity of influencing people to strive willingly for mutual
objective‖
Leadership The ability to influence a group toward the achievement of goals.
Characteristics of a leadership
 It is a process of influencing.
 It is the function of stimulation.
 Leadership gives an experience of helping attain the common goal.
 Employee must be satisfied with type of leadership.
Significance/ importance of leadership
 Determination of goal.
 Organization of activity.
 Achieving coordination.
 Representation of worker.
 Providing guidance.
 Inspiration for subordinate.
 Building employee morale.
 Facilitating change.
Components of leadership
Leadership Traits
 Intelligence
 More intelligent than non-leaders

 Scholar
 Knowledge
 Being able to get things done
 Physical
 Doesn’t see to be correlated
 Personality
 Communication
 Honesty
 Initiative
 Aggressive
 Self-confident
 Ambitious
 Creativity
 Sociability
 flexibility
What skills do leaders need?
 Personal Skills
 Interpersonal Skills
•Interpersonal Skills
•Coaching
•Counseling
•Listening
4. Communication
supportively
5. Gaining power
and influences
7. Management
conflict
•Gaining power
•Exercise influence
•Empowering others
6. Motivating others
•Identifying causes
•Selecting appropriate strategies
•Resolving confrontations
•Diagnosing poor performance
•Creating a motivating environment
•Rewarding accomplishment

Leaders Vs ManagersLeader vs manager
Styles of leadership:
1-Styles based on authority retained
 Autocratic or authoritarian leader
 Participative or Democratic leader
 Free rein or laissez faire leader
2-style based on task Vs relationship
 Autocratic
 Participative
 Supportive
 Free rein
3-style based on assumptions about people
 Exploitative
 Benovolent authoritarian
 Consultive
 participative
1- Style based on authority:
Autocratic:
 Leader makes decisions without reference to anyone else
 High degree of dependency on the leader
 Can create de-motivation and unfriendliness
of staff
 May be valuable in some types of business where decisions need to be made quickly and
decisively
Democratic:
 help motivation and involvement
 Workers feel ownership of the firm and its ideas

 Improves the sharing of ideas and experiences within the business
 Can delay decision making
Free-Rein:
 the leadership responsibilities are shared by all
 Can be highly motivational, as people have control over their working life
 Relies on good team work
 Relies on good interpersonal relations
 Can make coordination and decision making time-consuming and lacking in overall direction
 Can be very useful in businesses where creative ideas are important
2- Types of leadership (based on task Vs relationship)
Charismatic Leadership
Key Characteristics of Charismatic leaders
• Self Confidence- They have complete confidence in their judgment and ability.
• A vision- This is an idealized goal that proposes a future better than the status quo. The greater the
disparity between idealized goal and the status quo, the more likely that followers will attribute
extraordinary vision to the leader.
• Ability to articulate the vision- They are able to clarify and state the vision in terms that are
understandable to others. This articulation demonstrates an understanding of the followers‘ needs and,
hence acts as a motivating force.
• Strong convictions about vision- Charismatic leaders are perceived as being strongly committed, and
willing to take on high personal risk, incur high costs, and engage in self-sacrifice to achieve their
vision.
• Behavior that is out of the ordinary- Those with charisma engage in behavior that is perceived as
being novel, unconventional, and counter to norms. When successful , these behaviors evoke surprise
and admiration in followers.
• Perceived as being a change agent- Charismatic leaders are perceived as agents of radical change
rather than as caretakers of the status quo.
• Environmental sensitivity- These leaders are able to make realistic assessments of the environmental
constraints and resources needed to bring about change.
Theories of Leadership
1. Trait Theories:
2. Situational/Contingency Theories
3. Behavioral Theories:
1. Trait Theories
Similar in some ways to "Great Man" theories, trait theories assume that people inherit certain qualities and traits
that make them better suited to leadership. Trait theories often identify particular personality or behavioral
characteristics shared by leaders. If particular traits are key features of leadership, then how do we explain people
who possess those qualities but are not leaders? This question is one of the difficulties in using trait theories to
explain leadership.

2.Behavioral Theories:
Behavioral theories of leadership are based upon the belief that great leaders are made, not born. Rooted
in behaviorism, this leadership theory focuses on the actions of leaders not on mental qualities or internal states.
According to this theory, people can learn to become leaders through teaching and observation.
Some theories are as---
1. Ohio state university studies
2. University of Michigan studies
3.Theory of X and Y
4.Blake & Mouton Managerial Grid (1964)
4. Situational/contingency Theories: Situational theories propose that leaders choose the best course of action
based upon situational variables. Different styles of leadership may be more appropriate for certain types of
decision-making.
Some theories are as-
 Fiedler's Contingency Model
 The Hersey-Blanchard Model of Leadership.
 Tannenbaum & Schmidt’s Leadership Continuum
 Adair’s Action-Centred Leadership Model
Trait Theories
What characteristics or traits make a person a leader?
Great Man Theory: Individuals are born either with or
without the necessary traits for leadership.
 Intelligence
 Physiological features
 Inner motivations drive
 Emotional stability
 Self confidence
 Vision
 Maturity
 Acceptance of responsibility
 Self Motivation
 Human Relation
 Empathy
 Openness and adaptability
Behavioral Theories
 Ohio state studies:
A famous series of studies on leadership were done in
Ohio State University, starting in the 1950s. They found
two critical characteristics either of which could be high
or low and were independent of one another.
The research was base on questionnaires to leaders and
subordinates. These are known as the Leader Behavior
Description Questionnaire (LDBQ) and the Supervisor
Behavior Description Questionnaire (SDBQ). By 1962,
the LDBQ was on version XII.

Actions--
Consideration
Consideration is the degree to which a leader acts in a friendly and supportive manner towards his or her
subordinates.
Initiating Structure
This is the degree to which a leader defines and structures his or her role and the roles of the subordinates towards
achieving the goals of the group.
 The Michigan Leadership Studies
The Michigan Leadership Studies which began in the 1950s and indicated that leaders could be classified as either
"employee centered," or "job centered." These studies identified three critical characteristics of effective leaders:
task oriented behavior, relationship-oriented behavior, and participative leadership.
 McGregors Theory X & Theory Y
McGregors Theory X & Theory Y developed by Douglas McGregor in the 1960s at MIT Sloan School of
Management. These theories described employee motivation in the workforce. Both theories begin with the premise
that the role of management is to assemble the factors of production, including people, for the economic benefit of
the firm. Beyond this point, the two theories of management diverge.
As previously discussed—
 The Blake Mouton Managerial Grid (Blake
& Mouton, 1964)
The Managerial Grid developed by Robert Blake and
Jane Mouton focuses on task (production) and
employee (people) orientations of managers, as well as
combinations of concerns between the two extremes. A
grid with concern for production on the horizontal axis
and concern for people on the vertical axis and plots
five basic leadership styles. The first number refers to a
leader's production or task orientation; the second, to
people or employee orientation.
Blake and Mouton propose that ―Team Management‖ -
a high concern for both employees and production - is
the most effective type of leadership behaviour.
4. Situational/contingency Theories
 Fiedler's Contingency Model
The Fiedler contingency model is a leadership theory of industrial
and organizational psychology developed by Fred Fiedler (born
1922), one of the leading scientists who helped his field move from
the research of traits and personal characteristics of leaders to
leadership styles and behaviours.

Two factors
The first management style, Taylorists, assumed there was one best style of leadership. Fiedler‘s contingency model
postulates that the leader‘s effectiveness is based on ‗situational contingency‘ which is a result of interaction of two
factors: leadership style and situational favourableness (later called situational control). More than 400 studies have
since investigated this relationship.
Least preferred co-worker (LPC)
The leadership style of the leader, thus, fixed and measured by what he calls the least preferred co-worker (LPC)
scale, an instrument for measuring an individual‘s leadership orientation.
Situational favourableness
According to Fiedler, there is no ideal leader. Both low-LPC (task-oriented) and high-LPC (relationship-oriented)
leaders can be effective if their leadership orientation fits the situation. The contingency theory allows for predicting
the characteristics of the appropriate situations for effectiveness. Three situational components determine
the favourableness of situational control:
Leader-Member Relations, referring to the degree of mutual trust, respect and confidence between the leader and the
subordinates.
Task Structure, referring to the extent to which group tasks are clear and structured.
Leader Position Power, referring to the power inherent in the leader's position itself.
When there is a good leader-member relation, a highly structured task, and high leader position power, the situation
is considered a "favorable situation." Fiedler found that low-LPC leaders are more effective in extremely favourable
or unfavourable situations, whereas high-LPC leaders perform best in situations with intermediate favorability.
Leader-situation match and mismatch
Since personality is relatively stable, the contingency model suggests that improving effectiveness requires
changing the situation to fit the leader. This is called "job engineering." The organization or the leader may
increase or decrease task structure and position power, also training and group development may improve leader-member
relations. In his 1976 book Improving Leadership Effectiveness: The Leader Match Concept Fiedler
(with Martin Chemers and Linda Mahar) offers a self paced leadership training programme designed to help leaders
alter the favourableness of the situation, or situational control.
 The Hersey-Blanchard Model of Leadership.
Hersey and Blanchard characterized leadership style in terms of
the amount of Task Behavior and Relationship Behavior that the
leader provides to their followers. They categorized all
leadership styles into four behavior types, which they named S1
to S4:
S1: Telling - is characterized by one-way communication in
which the leader defines the roles of the individual or group and
provides the what, how, why, when and where to do the task;
S2: Selling - while the leader is still providing the direction, he
or she is now using two-way communication and providing the
socio-emotional support that will allow the individual or group
being influenced to buy into the process;
S3: Participating - this is how shared decision-making about
aspects of how the task is accomplished and the leader is
providing less task behaviours while maintaining high
relationship behavior;
S4: Delegating - the leader is still involved in decisions;
however, the process and responsibility has been passed to the
individual or group. The leader stays involved to monitor
progress.

Of these, no one style is considered optimal for all leaders to use all the time. Effective leaders need to be flexible,
and must adapt themselves according to the situation.
The Hersey-Blanchard Model of Leadership.
Maturity Levels
The Hersey-Blanchard Situational Leadership Theory identified four levels of Maturity M1 through M4:
M1 - They still lack the specific skills required for the job in hand and are unable and unwilling to do or to take
responsibility for this job or task. (According to Ken Blanchard "The honeymoon is over")
M2 - They are unable to take on responsibility for the task being done; however, they are willing to work at the task.
They are novice but enthusiastic.
M3 - They are experienced and able to do the task but lack the confidence or the willingness to take on
responsibility.
M4 - They are experienced at the task, and comfortable with their own ability to do it well. They are able and
willing to not only do the task, but to take responsibility for the task.
Maturity Levels are also task-specific. A person might be generally skilled, confident and motivated in their job, but
would still have a maturity level M1 when asked to perform a task requiring skills they don't possess.
 Tannenbaum & Schmidt’s
Leadership Continuum
The leadership continuum was originally
written in 1958 by Tannenbaum and Schmidt
and was later updated in the year 1973. Their
work suggests a continuum of possible
leadership behavior available to a manager and
along which many leadership styles may be
placed. The continuum presents a range of
action related to the degree of authority used
by the manager and to the area of freedom
available to non-managers in arriving at
decisions. A broad range of leadership styles have been depicted on the continuum between two extremes of
autocratic and free rein (See figure 1). The left side shows a style where control is maintained by a manager and the
right side shows the release of control. However, neither extreme is absolute and authority and freedom are never
without their limitations.
The Tannenbaum and Schmidt continuum can be related to McGregor‘s supposition of Theory X and Theory Y.
Boss-centered leadership is towards theory X and subordinate-centered leadership is towards theory Y
A manager is characterized according to degree of control that is maintained by him. According to this approach,
four main styles of leadership have been identified:
TellsSellsConsultsJoins
Tells: The manager identifies a problem, chooses a decision, and announces this to subordinates. The subordinates
are not a party to the decision making process and the manager expects them to implement his decisions as soon as
possible.
Sells: The decision is chosen by the manager only but he understands that there will be some amount of resistance
from those faced with the decision and therefore makes efforts to persuade them to accept it.
Consults: Though the problem is identified by the manager, he does not take a final decision. The problem is
presented to the subordinates and the solutions are suggested by the subordinates.
Joins: The manager defines the limits within which the decision can be taken by the subordinates and then makes
the final decision along with the subordinates.
According to Tannenbaum and Schmidt, if one has to make a choice of the leadership style which is practicable and
desirable, then his answer will depend upon the following three factors:
Forces in the Manager: The behavior of the leader is influenced by his personality, background, knowledge, and
experience. These forces include:
Value systems
Confidence in subordinates

Leadership inclinations
Feelings of security in an uncertain situation
Forces in the subordinate: The personality of the subordinates and their expectations from the leader influences
their behavior. The factors include:
Readiness to assume responsibility in decision-making
Degree of tolerance for ambiguity
Interest in the problem and feelings as to its importance
Strength of the needs for independence
Knowledge and experience to deal with the problem
Understanding and identification with the goals of the organization
If these factors are on a positive side, then more freedom can be allowed to the subordinate by the leader.
Forces in the situation: The environmental and general situations also affect the leader‘s behavior. These include
factors like:
Type of organization
Group effectiveness
Nature of the problem
Time pressure
When the authors updated their work in1973, they suggested a new continuum of patterns of leadership behavior. In
this, the total area of freedom shared between managers and non-managers is redefined constantly by interactions
between them and the environmental forces. This pattern was, however, more complex in comparison to the
previous one.
Conclusion
According to Tannenbaum and Schmidt, successful leaders know which behavior is the most appropriate at a
particular time. They shape their behavior after a careful analysis of self, their subordinates, organization, and
environmental factors.
 John Adair's Action-Centred Leadership model
In any situation where a group of people are trying to achieve
some goal, one or more of those people will emerge and act
as a leader to the others.
Look again at this sentence more closely. Break it down into
elements. What are they?
According to John Adair, there are three elements to all
leadership situations. They are:
The achievement of a goal or task. This may be the
completion of a very practical activity or it may be a less
tangible goal. We know that effective groups have clear goals
shared by all members. Often the task is what brings the group together in the first place.
The group of people performing the task. It is likely that the task will only be achieved if all members of the
group work together to the common good. Therefore, the group itself has to be understood as an entity in its own
right.
Each individual member of the group involved in the task. While the group will take on a life of its own,
individuals do not lose their own identity. Their needs as people must continue to be met if their allegiance to the
group, and their motivation to achieve the task, is to be sustained.
Conti---
This approach, "Action-Centred Leadership", is centred on the actions of the leader. The leader has to balance the
needs from each of the three elements. The effective leader is the one who keeps all three in balance; that is who
attends to all three at the same time. If any one element is ignored, the others are unlikely to succeed.
At the same time, the three elements can conflict with each other. For example, pressure on time and resources often
increases pressure on a group to concentrate on the task, to the possible detriment of the people involved. But if
group and individual needs are forgotten, much of the effort spent may be misdirected.

In another example, taking time creating a good team spirit without applying effort to the task is likely to mean that
the team will lose its focus through lack of achievement.
John Adair's Action-Centred Leadership model is represented by Adair's 'three circles' diagram, which illustrates
Adair's three core management responsibilities:
 achieving the task
 managing the team or group
 managing individuals
your responsibilities as a manager for achieving the task are:
identify aims and vision for the group, purpose, and direction - define the activity (the task)
identify resources, people, processes, systems and tools (inc. financials, communications, IT)
create the plan to achieve the task - deliverables, measures, timescales, strategy and tactics
establish responsibilities, objectives, accountabilities and measures, by agreement and delegation
set standards, quality, time and reporting parameters
control and maintain activities against parameters
monitor and maintain overall performance against plan
report on progress towards the group's aim
review, re-assess, adjust plan, methods and targets as necessary
your responsibilities as a manager for the group are:
establish, agree and communicate standards of performance and behaviour
establish style, culture, approach of the group - soft skill elements
monitor and maintain discipline, ethics, integrity and focus on objectives
anticipate and resolve group conflict, struggles or disagreements
assess and change as necessary the balance and composition of the group
develop team-working, cooperation, morale and team-spirit
develop the collective maturity and capability of the group - progressively increase group freedom and authority
encourage the team towards objectives and aims - motivate the group and provide a collective sense of purpose
identify, develop and agree team- and project-leadership roles within group
enable, facilitate and ensure effective internal and external group communications
identify and meet group training needs
give feedback to the group on overall progress; consult with, and seek feedback and input from the group
your responsibilities as a manager for each individual are:
understand the team members as individuals - personality, skills, strengths, needs, aims and fears
assist and support individuals - plans, problems, challenges, highs and lows
identify and agree appropriate individual responsibilities and objectives
give recognition and praise to individuals - acknowledge effort and good work
where appropriate reward individuals with extra responsibility, advancement and status
identify, develop and utilise each individual's capabilities and strengths
train and develop individual team members
develop individual freedom and authority
An approach that a skilled leader might take, in any challenge, is to balance the needs of all three elements as
follows:
Identify and evaluate the requirements of the task.
Communicate these to the group and gain their commitment.
Plan the achievement of the task with the group.
Identify resources within the group and allocate responsibility to individuals.
Monitor and evaluate progress of the whole group and of individual members.
Communicate feedback to the group and support, praise, encourage individuals.
Review plans, and make changes, with the group until the task is achieved.
 Path goal theory of Robert house
The theory was developed by Robert House and has its roots in the expectancy theory of motivation. The theory is
based on the premise that an employee‘s perception of expectancies between his effort and performance is greatly
affected by a leader‘s behavior. The leaders help group members in attaining rewards by clarifying the paths to goals

and removing obstacles to performance. They do so by providing the information, support, and other resources
which are required by employees to complete the task.
House‘s theory advocates servant leadership. As per servant leadership theory, leadership is not viewed as a
position of power. Rather, leaders act as coaches and facilitators to their subordinates. According to House‘s path-goal
theory, a leader‘s effectiveness depends on several employee and environmental contingent factors and certain
leadership styles. All these are explained in the figure 1 below:
Leadership Styles:
The four leadership styles are:
Directive: Here the leader provides guidelines, lets subordinates know what is expected of them, sets performance
standards for them, and controls behavior when performance standards are not met. He makes judicious use of
rewards and disciplinary action. The style is the same as task-oriented one.
Supportive: The leader is friendly towards subordinates and displays personal concern for their needs, welfare, and
well-being. This style is the same as people-oriented leadership.
Participative: The leader believes in group decision-making and shares information with subordinates. He consults
his subordinates on important decisions related to work, task goals, and paths to resolve goals.
Achievement-oriented: The leader sets challenging goals and encourages employees to reach their peak
performance. The leader believes that employees are responsible enough to accomplish challenging goals. This is
the same as goal-setting theory.
According to the theory, these leadership styles are not mutually excusive and leaders are capable of selecting more
than one kind of a style suited for a particular situation.
Group dynamics
Group dynamics refers to a system of behaviors and psychological processes occurring within a social
group (intragroup dynamics), or between social groups (intergroup dynamics).
Features of group
 Perception
 Motivation
 Group goals
 Group organizatation
 Interdependency
 Interactions
 Entity
Group: Meanings and definitions
A group consist of two or more person who interact with each other, consistently for the achievement of certain
common objectives. The members of the group are interdependent and are aware that they are the part of a group.
Definitions
According to David H. Smith
―A group is a set of two are more individuals who are jointly characterized by a network of relevant
communication, a share sense of collective identity and one are more shared dispositions with associated normative
strength.‖
Characteristics of a group
 Social interactions
 Stable structure
 Common interest
 Perceive themselves as a part of group
 Advantage of working in group
 Pooling of knowledge and information
 Satisfaction and commitment

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