Chapter 1

Concept of Organizational Behavior

Organizational Behavior (OB) is a multidisciplinary field of study that

focuses on understanding and managing individuals, groups, and
structures within an organization to improve its effectiveness and
achieve organizational goals.
Interdisciplinary Nature: Organizational Behavior draws from
various disciplines, including psychology, sociology, anthropology,
economics, and management. It combines insights from these fields to
analyze and understand human behavior in organizational setting
Focus on Individuals: It examines the behavior of individuals within
an organization, including their attitudes, values, motivation,
perception, and job satisfaction. Understanding individual behavior is
crucial for effective management
Group Dynamics: OB also explores how individuals interact within
groups or teams. This includes studying communication patterns,
group norms, leadership styles, and conflict resolution mechanisms
Organizational Culture: Culture refers to the shared values, beliefs,
and norms that shape the behavior of individuals within an
organization. OB looks at how culture influences employee behavior,
decision-making, and overall organizational performance
Leadership and Management: OB delves into the role of leaders
and managers in influencing employee behavior. It examines different
leadership styles, power dynamics, and the impact of leadership on
organizational outcomes
Motivation and Job Satisfaction: Understanding what motivates
employees and keeps them satisfied in their jobs is a central concern
of OB. This includes examining factors like intrinsic and extrinsic
motivation, rewards systems, and work-life balance
Communication: Effective communication is crucial for a well-
functioning organization. OB studies the various channels of
communication, barriers to effective communication, and strategies for
improving communication within the organization
Decision-Making and Problem Solving: OB explores how
individuals and groups make decisions and solve problems within an
organizational context. This includes examining cognitive biases,
decision-making models, and problem-solving techniques
Change Management: In a rapidly changing business environment,
understanding how individuals and organizations adapt to change is
critical. OB provides insights into managing resistance to change,
implementing organizational change initiatives, and fostering a culture
of adaptability
Conflict and Negotiation: Conflict is inevitable in any organization.
OB looks at the sources of conflict, its effects on individuals and teams,
and strategies for resolving conflicts and negotiations effectively
Ethics and Corporate Social Responsibility: OB also considers the
ethical dimensions of behavior within organizations. This includes
examining ethical dilemmas, ethical decision-making, and the role of
organizations in society
Global Perspective: With the increasing globalization of business, OB
takes into account the cultural and diversity issues that impact
behavior in multinational organization
Application in Practice: The insights gained from studying OB are
applied in various areas of management, including human resource
management, organizational development, leadership development,
and employee training and development.

Role of OB in Manager’s functions

Organizational Behavior (OB) plays a crucial role in each of a manager's functions
—planning, organizing, leading, and controlling. Here's how OB influences these
functions.
1. Planning

a) Understanding Individual and Group Behavior: OB helps managers

anticipate how individuals and groups within the organization are likely to
react to different goals, tasks, and objectives. This understanding is vital for
setting realistic and achievable targets
b) Setting Realistic Expectations: By considering the behavioral aspects of
employees, managers can set goals and objectives that align with the
capabilities, motivation, and skills of the workforce
 c) Cultural Considerations: OB also takes into account organizational
culture, which is crucial in determining the feasibility and acceptance of
various plans and initiatives

2. Organizing:

a) Structuring Tasks and Responsibilities: OB helps managers assign roles and

responsibilities based on employees' strengths, skills, and preferences. This
ensures that tasks are aligned with individual capabilities
b) Group Dynamics and Team Composition: Understanding how groups
function helps in forming effective teams. Managers can create teams with
complementary skills and compatible working styles
c) Creating a Positive Work Environment: Organizational Behavior insights
can be used to design workspaces and establish policies that foster a positive
and productive work environment

3. Leading:

a) Adopting Effective Leadership Styles: OB provides managers with

insights into different leadership styles and their impact on employee
motivation and performance. This enables them to adapt their
leadership approach to suit the needs of their team members
b) Motivation and Employee Engagement: OB helps managers
understand what motivates employees at an individual and group
level. This knowledge can be applied to create incentive structures and
recognition programs that boost morale and productivity
c) Managing Conflict and Communication: Understanding OB
principles aids in handling conflicts effectively and promoting open,
honest communication within the team
4. Controlling:

a) Performance Evaluation: OB helps in designing performance

appraisal systems that take into account the behavioral aspects of job
performance. This ensures that evaluations are fair and accurate
b) Identifying Behavioral Patterns: Managers can use OB insights to
identify patterns of behavior that may be affecting productivity or
performance. They can then take corrective actions as necessary
c) Monitoring Employee Well-being: Understanding employee
behavior allows managers to identify signs of stress, burnout, or
dissatisfaction. This enables them to implement measures to support
employee well-being