ORGANIZATIONAL BEHAVIOR

Meenakshi Dave
Div.- B Roll no. 21

Chapter 1 What is Organizational Behavior?

OB is the study and application of knowledge how people act or behave within organization. It is a
human tool for human benefit. It applies broadly to the behavior of people in all types of
organizations such as businesses, government schools and service organizations.

Interpersonal skills are important because…

• ‘Good places to work’ have better financial performance.
• Better interpersonal skills result in lower turnover of quality employees and higher quality
applications for recruitment.
• There is a strong association between the quality of workplace relationships and job
satisfaction, stress, and turnover.
• It fosters social responsibility awareness.
•
Manager’s Functions, Roles, and Skills

• Manager: Someone who gets things done through other people in organizations.
• Organization: A consciously coordinated social unit composed of two or more people that
functions on a relatively continuous basis to achieve a common goal or set of goals.
– Planning, organizing, leading, and controlling.
• Mintzberg concluded that managers perform ten different, highly interrelated roles or sets
of behaviors attributable to their jobs.
 Category Roles

Figurehead
Leader
Interpersonal Liaison

Monitor
Disseminator
Informational Spokesperson

Entrepreneur
Disturbance Handler
Resource Allocator
Decisional Negotiator

Behavioral Science Disciplines

• Psychology: seeks to measure, explain, and sometimes change the behavior of
humans and other animals.
• Social psychology: blends the concepts of psychology and sociology.
• Sociology: studies people in relation to their social environment or culture.
• Anthropology: is the study of societies to learn about human beings and their
activities.
Challenges for Organizational Behavior:
• Responding to economic pressure
• Responding to globalization
• Managing workforce diversity
• Improving customer service
• Improving people skills
• Working in networked organizations
• Using social media at work
• Enhancing employee well-being at work
• Creating a positive work environment
• Improving ethical behavior
Chapter 2 Diversity in Organizations
Discrimination is to note a difference between things. Unfair discrimination assumes stereotypes
about groups.
– Refusal to recognize individual differences is harmful to organizations and
employees.
• Stereotype threat describes the degree to which we agree internally with the generally
negative stereotyped perceptions of our groups.
– Can be combatted by treating employees as individuals and not highlighting group
differences.
–
• Biological characteristics are personal characteristics that are objective and easily obtained
from personnel records.
– Variations in these can be the basis for discrimination
• Age
– The U.S. workforce is aging.
– Does job performance decline with increasing age?
– Studies show that turnover and absenteeism rates are lower among older workers,
and age is not associated with lower productivity.
• Sex
– There are no consistent male-female differences in problem-solving ability,
analytical skills, competitive drive, motivation, sociability, or learning drive.
But women earn less than men for the same positions and have fewer professional
opportunities

• Race and Ethnicity

– Laws against race and ethnic discrimination are in effect in many countries.
– But:
▪ Employees tend to favor colleagues of their own race in performance
evaluations, promotion decisions, and pay raises.
▪ African Americans generally fare worse than Whites in employment
decisions.
• Disabilities
– The U.S. Equal Employment Opportunity Commission classifies a person as disabled
who has any physical or mental impairment that substantially limits one or more
major life activities.
 – Workers with disabilities receive higher performance evaluations, but may have
lower performance expectations.

• Hidden Disabilities
▪ Sensory disabilities, chronic illness or pain, cognitive or learning
impairments, sleep disorders, and psychological challenges.
▪ U.S. organizations must accommodate employees with a very broad range
of impairments.
– Tenure
▪ Tenure is a good predictor of employee productivity.
▪ Tenure and job performance are positively related.
– Religion
▪ U.S. law prohibits discrimination based on religion, but it is still an issue,
especially for Muslims.
– Sexual Orientation and Gender Identity
▪ Federal law does not protect employees against discrimination based on
sexual orientation, though many states and municipalities do.
▪ Many Fortune 500 companies have policies covering sexual orientation and
about half now have policies on gender identity.
– Cultural Identity
▪ Need to accommodate and respect individual cultural identities.

• Ability is an individual’s current capacity to perform various tasks in a job.

• Two types
– Intellectual abilities
– Physical abilities

Managing diversity In Organizations:

• Attracting, selecting, developing, and retaining diverse employees

– Target recruiting messages to specific demographic groups.
– Some companies have been actively working toward recruiting less-hired groups.
• Diversity in Groups
– Most people in groups need a common way of looking at and accomplishing major
tasks, and they need to communicate well with each other.
• Emphasize higher-level similarities among people.
• Expatriate Adjustment
– Organizations should select employees for international assignments who are
capable of adjusting quickly and ensure they have the support they need for their
assignment.
• Effective diversity programs
– Teach managers about the legal framework for equal employment opportunity and
encourage fair treatment of all people.
– Teach managers how a diverse workforce will be more effective at serving a diverse
customer base.
– Foster personal development practices that bring out the skills and abilities of
everyone.
Chapter 3: Emotions and Moods

Affects: Defined as a broad range of feelings that people experience. Affect can be experienced in
the form of emotions or moods.

Emotions:
• Caused by specific event
• Very brief in duration (seconds or minutes)
• Specific and numerous in nature (many specific emotions such as anger, fear, sadness,
happiness, disgust, surprise)
• Usually accompanied by distinct
• facial expressions
• Action-oriented in nature

Moods
• Cause is often general and unclear
• Last longer than emotions (hours or days)
• More general (two main dimensions - positive affect and negative affect - that are
composed of multiple specific emotions)
• Generally, not indicated by distinct expressions
• Cognitive in nature

Sources of Emotions and Moods:

Personality
Time of Day
Day of the week
Weather
Stress
Social Activities
Sleep
Exercise
Age
Sex

Emotions and moods are similar because both are affective in nature. But they’re
also, different—moods are more general and less contextual than emotions. The
time of day, stressful events, and sleep patterns are some of the factors that influence emotions
and moods. OB research on emotional labor, affective events theory, emotional intelligence, and
emotion regulation helps us understand how people deal with emotions. Emotions and moods
have proven relevant for virtually every OB topic we study, with implications for managerial
practices.
Implications for Managers

• Recognize that emotions are a natural part of the workplace, and good management does
not mean creating an emotion-free environment.

• To foster effective decision making, creativity, and motivation in employees, model

positive emotions and moods as much as is authentically possible.

• Provide positive feedback to increase the positivity of employees. Of course, it also helps to
hire people who are predisposed to positive moods.

• In the service sector, encourage positive displays of emotion, which make customers feel
more positive and thus improve customer service interactions and negotiations.

• Understand the role of emotions and moods to significantly improve your ability to explain
and predict your co-workers’ and others’ behavior.
Chapter 4: Attitude and Job Satisfaction

Attitude: Attitudes are learned predispositions towards aspects of our environment. They may be
positive or negative directed towards certain people, service or institutions.

Attitude can be precisely defined as a persistent tendency to feel and behave in a particular way
towards some objects, persons or events.

Components of attitude:

Affective = feeling
Behavioral = Action
Cognitive = evaluation

Job Satisfaction:
It is a positive attitude towards one’s job. It is defined as a pleasurable or positive emotional state
resulting from the appraisal of one’s job or job experience.

Job satisfaction is measured in following ways:

1. Single global rating
2. Summation score
3. Interviews
4. Action tendencies
5. Critical incidents
Causes of job satisfaction:

supportive
colleagues

Nature of
Working work
conditions
Job
satisfaction

quality Pay and

supervision promotion

Outcomes of job satisfaction:

On performance:
In the long run job satisfaction leads to increased productivity

On absenteeism:
There is inverse relationship. When satisfaction is high, absenteeism tends to be lower and vice
versa

On turnover:
Inverse relationship at moderate level.
Employees with high job satisfaction tend to have better mental health and physical health.
They learn new job-related tasks more easily and quickly
They commit less mistakes including on the job accidents
They have and file less grievances about the job and the management
Last but not the least, the satisfied employees tend to evince prosocial attitude towards their
coworkers and customers.
Job dissatisfaction:
Though job dissatisfaction can be expressed in a number of ways on an overall basis job
dissatisfaction reflects the employees negative or unfavorable feelings towards their jobs.
The following section examines the most important of them:
Constructive Destructive
Active voice Exit
passive loyalty neglect

Corporate Social Responsibilities (CSR):

An organization’s commitment to corporate social responsibility (CSR), or its self-regulated actions
to benefit society or the environment beyond what is required by law, increasingly affects
employee job satisfaction. Organizations practice CSR in several ways, including environmental
sustainability initiatives, non-profit work and charitable giving.
Chapter 5: Personality and values

Personality:
It can be defined as the sum total of ways in which an individual reacts and interacts with others
and environment. In other words, personality is an organized behavior of an individual to react to
a given stimulus in a set manner.

How is personality measured?

Understanding of personality greatly influences several decisions like hiring personnel,
establishing relationship, designing motivational packages, promotion, etc.
Personality can be measured as follow:
1. Personality inventories
2. Projective tests
3. Assessment center
Factors that shape personality are;
1.heredity
2. Environment
3. situation
Strengths and weakness of the MBTI and Big Five model
Most widely used personality model is the Myers-Briggs Type Indicator (MBTI):
Here, individuals are classified as
- Extroverted or introverted (E or I)
- Sensing or Intuitive (S or N)
- Thinking or Feeling (T or F)
- Perceiving or judging (P or J)
o INTJs are visionaries
o ESTJs are organizers
o Entps are conceptualizers

The Big Five Model

- Extraversion
- Agreeableness
- Conscientiousness
- Emotional Stability
- Openness to experience
Traits that matter most to businesses are:
Persistence
Attention to detail
Efficiency
Analytical skills
Setting high standards

Less important
Strong oral communication
Teamwork
Flexibility/adaptability
Enthusiasm
Listening skills

Weaknesses of any self-report personality instrument (both the MBTI and FFM).

Each of us has blind spots. Sometimes we do not see ourselves as others do. In other words, we
can sometimes engage in unconscious denial.

Then, in certain contexts (such as an employment selection context), we can intentionally mis-
characterize who we are in order to “curry favour.” In other words, people can and do lie with self-
report inventories. The 16PF includes what are called “validity scales” to inform whether or not
the person was misrepresenting himself/herself when answering the questions. The NEO-PI-
R does NOT include such validity scales. Most Five Factor Model inventories, like the NEO-PI-R, do
not include validity scales.

• The Dark Triad

– Machiavellianism: the degree to which an individual is pragmatic, maintains
emotional distance, and believes that ends can justify means.
– Narcissism: the tendency to be arrogant, have a grandiose sense of self-
importance, require excessive admiration, and have a sense of entitlement.
– Psychopathy: the tendency for a lack of concern for others and a lack of guilt or
remorse when their actions cause harm.
 • An emerging framework to study dark side traits:
– First, antisocial people are indifferent and callous toward others.
– Second, borderline people have low self-esteem and high uncertainty.
– Third, schizotypal individuals are eccentric and disorganized.
– Fourth, obsessive compulsive people are perfectionists and can be stubborn, yet
they attend to details, carry a strong work ethic, and may be motivated by
achievement.
– Fifth, avoidant individuals feel inadequate and hate criticism.
• Other Personality Traits Relevant to OB
– Core Self-Evaluation: bottom line conclusions individuals have about their
capabilities, competence, and worth as a person.
– Self-Monitoring: measures an individual’s ability to adjust his or her behavior to
external, situational factors.
– Proactive Personality: people who identify opportunities, show initiative, take
action, and persevere until meaningful change occur

Hofstede’s Five Value Dimensions and GLOBE (1 of 2)

• Hofstede’s Framework
– Power distance
– Individualism versus collectivism
– Masculinity versus femininity
– Uncertainty avoidance
– Long-term versus short-term orientation
• Values: basic convictions about what is right, good, or desirable.
– Value system: ranks values in terms of intensity.
• The Importance and Organization of Values
– Values:
• Lay the foundation for understanding of attitudes and motivation.
• Influence attitudes and behaviors.
• Terminal vs. Instrumental Values
– Terminal values: desirable end-states of existence.
– Instrumental values: preferred modes of behavior or means of achieving terminal
values.
 • Person-Organization Fit
– People high on extraversion fit well with aggressive and team-oriented cultures.
– People high on agreeableness match up better with a supportive organizational
climate than one focused on aggressiveness.
– People high on openness to experience fit better in organizations that emphasize
innovation rather than standardization.

.
 Chapter 6: Perception and decision making

• Perception is a process by which individuals organize and interpret their sensory

impressions to give meaning to their environment.

• It is important to the study of OB because people’s behaviours are based on their perception
of what reality is, not on reality itself.
• Attribution theory suggests that when we observe an individual’s behaviour, we attempt to
determine whether it was internally or externally caused.

• Determination depends on three factors:

o Distinctiveness
o Consensus
o Consistency
• Clarification of the differences between internal and external causation
o Internally caused – those that are believed to be under the personal control of the
individual.
o Externally caused – resulting from outside causes.
• fundamental attribution error
o We have a tendency to underestimate the influence of external factors and
overestimate the influence of internal or personal factors.

• Self-serving bias
o Individuals attribute their own successes to internal factors.
• Common Shortcuts in Judging Others
o Selective perception
▪ Any characteristic that makes a person, object, or event stand out will
increase the probability that it will be perceived.
▪ Since we can’t observe everything going on around us, we engage in selective
perception.
• Halo effect
o The halo effect occurs when we draw a general impression based on a single
characteristic.

• Contrast effects
• We do not evaluate a person in isolation.
• Our reaction to one person is influenced by other persons we have recently
encountered.
 • Stereotyping

o Judging someone based on one’s perception of the group to which that person
belongs.
▪ We have to monitor ourselves to make sure we’re not unfairly applying a
stereotype in our evaluations and decisions.
• Applications of Shortcuts in Organizations
o Employment Interview
▪ Evidence indicates that interviewers make perceptual judgments that are
often inaccurate.
▪ Interviewers generally draw early impressions that become very
quickly entrenched.
▪ Studies indicate that most interviewers’ decisions change very little
after the first four or five minutes of the interview.
• Performance Expectations
o Evidence demonstrates that people will attempt to validate their perceptions of
reality, even when those perceptions are faulty.
▪ Self-fulfilling prophecy, or the Pygmalion effect, characterizes the fact that
people’s expectations determine their behaviour.
▪ Expectations become reality.
• Performance Evaluation
o An employee’s performance appraisal is very much dependent upon the perceptual
process.
▪ Many jobs are evaluated in subjective terms.
▪ Subjective measures are problematic because of selective perception,
contrast effects, halo effects, and so on.

Link Between Perception and Decision Making

• Individuals make decisions – choosing from two or more alternatives.

• Decision making occurs as a reaction to a problem.

o There is a discrepancy between some current state of affairs and some desired state,
requiring consideration of alternative courses of action.
▪ One person’s problem is another’s satisfactory state of affairs.
Steps in the Rational Decision-Making Model

1. Define the problem.

2. Identify the decision criteria.

3. Allocate weights to the criteria.

4. Develop the alternatives.

5. Evaluate the alternatives.

6. Select the best alternative.

• Assumptions of the Rational Model

o The decision maker…

▪ Has complete information.
▪ Is able to identify all the relevant options in an unbiased manner.
▪ Chooses the option with the highest utility.

Most decisions in the real world don’t follow the rational model.
• Bounded Rationality
o Most people respond to a complex problem by reducing it to a level at which it can
be readily understood.
▪ People satisfice – they seek solutions that are satisfactory and sufficient.
• Individuals operate within the confines of bounded rationality.
▪ They construct simplified models that extract the essential features.
• Intuition
o Intuitive decision making occurs outside conscious thought; it relies on holistic
associations, or links between disparate pieces of information, is fast, and is
affectively charged, meaning it usually engages the emotions.
o The key is neither to abandon nor rely solely on intuition, but to supplement it with
evidence and good judgment.
• Reducing Biases and Errors
• Focus on Goals. Without goals, you can’t be rational, you don’t know what information you
need, you don’t know which information is relevant and which is irrelevant, you’ll find it
difficult to choose between alternatives, and you’re far more likely to experience regret
over the choices you make. Clear goals make decision making easier and help you eliminate
options that are inconsistent with your interests.
• Look for Information That Disconfirms Your Beliefs. One of the most effective means for
counteracting overconfidence and the confirmation and hindsight biases is to actively look
for information that contradicts your beliefs and assumptions. When we overtly consider
various ways, we could be wrong, we challenge our tendencies to think we’re smarter than
we actually are.
 •
Don’t Try to Create Meaning out of Random Events. The educated mind has been trained
to look for cause-and-effect relationships. When something happens, we ask why. And
when we can’t find reasons, we often invent them. You have to accept that there are
events in life that are outside your control. Ask yourself if patterns can be meaningfully
explained or whether they are merely coincidence. Don’t attempt to create meaning out of
coincidence.
• Increase Your Options. No matter how many options you’ve identified, your final choice
can be no better than the best of the option set you’ve selected. This argues for increasing
your decision alternatives and for using creativity in developing a wide range of diverse
choices. The more alternatives you can generate, and the more diverse those alternatives,
the greater your chance of finding an outstanding one.
• Common Biases and Errors in Decision Making

o Overconfidence Bias: individuals whose intellectual and interpersonal abilities are

weakest are most likely to overestimate their performance and ability.
o Anchoring Bias: fixating on initial information as a starting point and failing to
adequately adjust for subsequent information.
• Confirmation Bias: type of selective perception.
o Seek out information that reaffirms past choices, and discount information that
contradicts past judgments.

• Availability Bias: tendency for people to base judgments on information that is readily
available.
• Escalation of Commitment: staying with a decision even when there is clear evidence that
it’s wrong.
o Likely to occur when individuals view themselves as responsible for the outcome.

• Randomness Error: our tendency to believe we can predict the outcome of random events.
o Decision making becomes impaired when we try to create meaning out of random
events.
• Risk Aversion: the tendency to prefer a sure thing instead of a risky outcome.
o Ambitious people with power that can be taken away appear to be especially risk
averse.
o People will more likely engage in risk-seeking behaviour for negative outcomes, and
risk-averse behaviour for positive outcomes, when under stress.

• Hindsight Bias: the tendency to believe falsely that one has accurately predicted the
outcome of an event, after that outcome is actually known.
• Utilitarianism: decisions are made solely on the basis of their outcomes or consequences.

• Focus on rights: calls on individuals to make decisions consistent with fundamental liberties
and privileges as set forth in documents such as the Bill of Rights.
o Protects whistle-blowers.

• Impose and enforce rules fairly and impartially to ensure justice or an equitable distribution
of benefits and costs.
• Behavioural ethics: an area of study that analyzes how people behave when confronted
with ethical dilemmas.
o Individuals do not always follow ethical standards promulgated by their
organizations, and we sometimes violate our own standards.
o There are ways to increase ethical decision making in organizations.
o Consider cultural differences.
• Lying
o One of the top unethical activities we may indulge in daily.
o It undermines all efforts toward sound decision making.
• Managers—and organizations—simply cannot make good decisions when facts are
misrepresented and people give false motives for their behaviours.
• Lying is a big ethical problem as well.
• Creativity is the ability to produce novel and useful ideas.

o These are ideas that are different from what has been done before, but that are
also appropriate to the problem.

Implications for Managers:

• Behaviour follows perception, so to influence behaviour at work, assess how people
perceive their work. Often behaviours we find puzzling can be explained by understanding
the initiating perceptions.

• Make better decisions by recognizing perceptual biases and decision-making errors we tend
to commit. Learning about these problems doesn’t always prevent us from making mistakes,
but it does help.
• Adjust your decision-making approach to the national culture you’re operating in and to
the criteria your organization values. If you’re in a country that doesn’t value rationality,
don’t feel compelled to follow the rational decision-making model or to try to make your
decisions appear rational. Adjust your decision approach to ensure compatibility with the
organizational culture.
• Combine rational analysis with intuition. These are not conflicting approaches to decision
making. By using both, you can improve your decision-making effectiveness.

• Try to enhance your creativity. Actively look for novel solutions to problems, attempt to
see problems in new ways, use analogies, and hire creative talent. Try to remove work and
organizational barriers that might impede your creativity.