Organizational behavior is the study of how individuals and groups act within organizations. It examines human behavior in work settings and applies knowledge to improve organizational effectiveness. There are three levels of analysis: individual behavior, group behavior, and organizational behavior itself. Factors like individual differences, perception, motivation, and the social nature of organizations all influence behavior. Common models of organizational behavior include autocratic, custodial, supportive, and collegial approaches. Cultural diversity in the workplace benefits organizations through increased productivity, creativity, profits, and cultural insights. It also improves employee engagement and reduces turnover.

1. Unit 1
Fundamentals of
Organizational Behaviour

2. What is OB?
Organisational behaviour is a field of study that investigates the
impact that individuals, groups and structure have on behaviour
within the organisations for the purpose of applying such
knowledge toward improving an organization’s effectiveness.”—
Stephens P. Robbins.
In short, organisational behaviour revolves around two
fundamental components:
• The nature of the man
• The nature of the organisation

3. Characteristics of Organisational
Behavior
• Behavioural Approach to Management- Organisational
behaviour is that part of whole management which
represents the behavioural approach to management.
Organisational behaviour has emerged as a distinct field of
study because of the importance of human behaviour in
organisations.
• Cause and Effect Relationship- Human behaviour is
generally taken in terms of cause and effect relationship
and not in philosophical terms. It helps in predicting the
behaviour of individuals. It provides generalizations that
managers can use to anticipate the effect of certain
activities on human behaviour

4. • Organisational Behaviour is a Branch of Social Sciences-
Organisational behaviour is heavily influenced by several
other social sciences viz. psychology, sociology and
anthropology. It draws a rich array of research from these
disciplines.
• Three Levels of Analysis:Organisational behaviour
encompasses the study of three levels of analysis namely
individual behaviour, inter-individual behaviour and the
behaviour of organisations themselves. The field of
organisational behaviour embraces all these levels as being
complementary to each other

5. • Beneficial to both Organisation and
Individuals- Organisational behaviour creates
an atmosphere whereby both organisation
and individuals are benefitted by each other. A
reasonable climate is created so that
employees may get much needed satisfaction
and the organisation may attain its objectives.

6. Nature of Organisational Behavior
• Organisational behaviour in the study of human behaviour
in the organisations. Whenever an individual joins an
organisation he brings with him unique set of personal
characteristics, experiences from other organisations and a
personal background. At the first stage organisational
behaviour must look at the unique perspective that each
individual brings to the work setting.
• The second stage of organisational behaviour is to study
the dynamics of how the incoming individuals interact with
the broader organisation. No individual can work in
isolation. He comes into contact with other individuals and
the organisation in a variety of ways. The individual who
joins a new organisation has to come into contact with the

7. • Over the time, he is affected by his work experience and the
organisation as well as his personal experiences and maturity.
On the other hand, the organisation is also affected by the
presence or absence of the individual. Thus, it is essential that
OB must study the ways in which the individuals and
organisation interact with each other.
• The organisational behaviour must be studied from the
perspective of the organisation itself because an organisation
exists before a particular individual joins in and continues to
exist after he or she has left the organisation. Thus, OB is the
study of human behaviour in the organisation, the individual-
organisation interaction and the organisation itself. And these
factors are influenced by the external environment in which the
individuals and the organisation exist.

8. • Thus, we can say that we cannot study individual behaviour
completely without learning something about the
organisation. On the other hand, we cannot study the
organisations without studying the behaviour of the
individuals working in it. This is because the organisation
influences and is influenced by the people working in it.
Moreover, both the individuals and the organisation are
influenced by the external environment. Thus, the field of
organisational behaviour is a complex field. It seeks to
throw light on the entire canvas of human factor in the
organisations which will include the causes and effects of
such behaviour.

9. Fundamental Concepts of
Organizational Behavior
• Individual Differences.
• Perception.
• A Whole Person.
• Motivated Behavior.
• The desire for Involvement.
• The value of the Person.
• Human Dignity.
• Organizations are Social System.
• Mutuality of Interest.
• Holistic Concept.

10. • Individual Differences- The idea of the individual
difference comes originally from psychology. From the
day of birth, each person is unique, and personal
experiences after birth tend to make people even more
different.
• Perception- Peoples’ perceptions are also different when
they see an object. Two people can differently present
the same object. And this is occurring for their
experiences. Employees also see work differently for
differ in their personalities, needs, demographics factors,
past experiences, and social surroundings.

11. • A Whole Person- An employee’s personal life is not detached from
his working life.As an example, A women who attend the office at
9:00 AM is always anxious for her children’s school time (if her kids
can participate in the school or not). As a result, its impact falls on
her concentration that means her working life.For this reason, we
cannot separate it. So the manager should treat an employee as a
whole person.
• Motivated Behavior- An employee has many basic
Needs. So, they want to fulfill those needs. That’s why; they had
to perform well in the organization.

12. • Desire for Involvement- Every employee is actively seeking
opportunities to work to involve in decision-making problems. They
hunger for the chance to share what they know and to learn from
the experience.So, the organization should provide them a chance
to express their opinions, ideas, and suggestions for the decision-
making problem.
• Value of the Person- An employee wants to be treated separately
from another factor of production, (land, capital, labor).They refuse
to accept the old idea that they are just treated as economic tools
because they are the best creation of Almighty .For this, reason,
they want to be treated with carrying respect, dignity and other
things from their employers and society.

13. • Human Dignity- This concept is very philosophical. Every person
needs to be treated with dignity and respect, whether it’s the CEO
of the company or labor. it recognizes human dignity because
people are of a higher order; they want to be treated with respect
and dignity and should be treated this way.
• Organizations are Social System-From sociology, we learn that
organizations are social systems; consequently, activities therein are
governed by social laws as well as psychological laws. Just as people
have psychological needs, they also have social roles and status.
Their behavior is influenced by their group as well as by their drives.
In fact, two types of social systems exist side by side in
organizations. One is a formal system, and the other is the informal
social system.

14. • Mutuality of Interest-Mutual interest is represented by the
statement that organizations need people and people also
need organizations.Organizations have a human purpose.
They are formed and maintained by some mutuality of
interest among their participants. If mutuality is lacking, it
makes no sense to try to assemble a group and develop
cooperation, because there is no common base on which to
build.
• Holistic Concept- When the fundamental concepts of OB are
placed together, a holistic concept emerges.This concept
interprets people-organization relationships regarding the
whole person, the whole group, whole organization, and the
whole social system.

16. Models of Organizational Behavior
• There are four major models or frameworks
that organizations operate out of, Autocratic,
Custodial, Supportive, and Collegial.
• Autocratic — The basis of this model is power
with a managerial orientation of authority.
The employees in turn are oriented towards
obedience and dependence on the boss. The
employee need that is met is subsistence. The
performance result is minimal.

17. • Custodial — The basis of this model is economic resources
with a managerial orientation of money. The employees in
turn, are oriented towards security, benefits, and dependence
on the organization. The employee need that is met is
security. The performance result is passive cooperation.
• Supportive — The basis of this model is leadership with a
managerial orientation of support. The employees in turn are
oriented towards job performance and participation. The
employee need that is met is status and recognition. The
performance result is awakened drives.

18. • Collegial — The basis of this model is
partnership with a managerial orientation of
teamwork. The employees in turn are oriented
towards responsible behavior and self-
discipline. The employee need that is met is
self-actualization. The performance result is
moderate enthusiasm.

19. Emerging aspects of Organizational
Behaviour:

21. What is Cultural Diversity?
• Cultural diversity is the quality of diverse or
different cultures, as opposed to monoculture,
the global monoculture, or a homogenization of
cultures, akin to cultural decay. The phrase
cultural diversity can also refer to having different
cultures respect each other's differences. The
phrase "cultural diversity" is also sometimes used
to mean the variety of
human societies or cultures in a specific region,
or in the world as a whole. Globalization is often
said to have a negative effect on the world's

22. Importance of Cultural Diversity in
Workplace
• Increased productivity
• Improved creativity
• Increased profits
• Improved employee engagement
• Reduced employee turnover
• Improved company reputation
• Wider range of skills
• Improves cultural insights

23. What is cultural diversity in the workplace?
• Cultural diversity in the workplace is when
companies are open to hiring employees from all
sorts of different backgrounds; regardless of race,
religion and culture. When companies recruit and
retain a diverse pool of people, it brings about
different benefits to the company as well as its
employees. Companies will also gain from each
employee by learning from each other’s experiences
and applying this new-found knowledge to their
work. Employees from all sorts of different
backgrounds get to learn from their colleagues’
experiences from a different perspective. Thus, they