Post and responses OB

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Chapter 1: Why Organizational Behavior Is Important in the 21st Century

What is Organizational Behavior and Why Is it Important?

“The success of your organization doesn’t depend on your understanding of economics, or organizational development, or marketing. It depends, quite simply, on your understanding of human psychology.”

Neck, Organizational Behavior. © SAGE Publications, 2017.

Today’s constantly changing economic world needs managers who can understand, anticipate, and direct people in a fast-paced competitive market. In the past, organizations focused on numbers and how to achieve those numbers, without paying too much attention to motivating and understanding their staff. However, fast-paced organizations need the right people with the right skills to achieve success. This is why organizational behavior has taken on a new level of importance; people with organizational behavior skills are now regarded as a valuable and essential commodity. In an environment where competition is fiercer than ever, it is people who will differentiate your business from anyone else’s. No matter what area of business you will end up working in, it is worth remembering that people are the cornerstone of success.

Figure 1.1: Four Functions of Managers

WHAT IS ORGANIZATIONAL BEHAVIOR AND WHY IS IT IMPORTANT

SOURCE: http://2012books.lardbucket.org/books/management-principles-v1.1/s19-the-essentials-of-control.html.

Managers need to be equipped with specific skills to carry out their roles effectively3 Firstly, they must have technical skills. A technical skill is an aptitude to perform and apply specialized tasks. Today’s managers need to be proficient in using the latest technologies, including databases, spreadsheets, email, and social networking tools. While technical skills are important, they can also be learned on the job.

To be really effective, managers need to possess human skills or the ability to relate to other people.5 People with good human skills take the feelings of others into account and are adept at dealing with conflict. Another facet of human skills is emotional intelligence (EI), which is an awareness of how your actions and emotions affect those around you, and the ability to understand and empathize with the feelings of others.

Managers need to be technically proficient and know how to get along with people, but what about dealing with the complexities of the organization itself? Managers need conceptual skills in order to see the organization as a whole, visualize how it fits into its overall environment, and understand how each part relates to the others. Good conceptual skills help managers solve problems, identify opportunities and challenges, and think creatively when it comes to decision making.

Figure 1.2: How Human Capital Enhances Competitive Advantage

Neck, Organizational Behavior. © SAGE Publications, 2017.

Managing Human Capital

Value

Employees can add value in many different ways, but there is a difference between merely fulfilling the requirements of your job and working with an eye on company strategy. Human capital value accumulates when employees work towards the strategic goals of an organization to achieve competitive advantage.

Rareness

Not everyone has the right skillset to further the progress of an organization. Human capital rareness is the level of exceptional skills and talents employees possess in an industry.

Inimitability

Employees may be able to add real value and possess rare and important skills, but these attributes must be inimitable for an organization to achieve success. Human capital inimitability is the degree to which the skills and talents of employees can be emulated by other organizations.

Behavioral Science Disciplines

Neck, Organizational Behavior. © SAGE Publications, 2017.

Figure 1.3 Disciplines

Contributing to the Field of Organizational Behavior

In the early days of management theory, studies focused on how workers could perform more efficiently (on a factory assembly line, for example), and how physical working conditions could be improved for better employee performance. There was little focus on the human element. Over the past one hundred years, however, researchers have carried out a host of studies on the practice and application of OB, taking full advantage of its strong links to five main behavioral science disciplines: psychology, sociology, social psychology, political science, and anthropology.

BEHAVIORAL SCIENCE DISCIPLINES

Psychology

Psychology is the scientific study of the human mind that seeks to measure and explain behavioral characteristics.

Neck, Organizational Behavior. © SAGE Publications, 2017.

Psychology is the scientific study of the human mind that seeks to measure and explain behavioral characteristics. Early organizational psychological research and theory focused on the factors affecting work performance and efficiency, such as lethargy and boredom. More recently, psychologists have focused on the mental health and well-being of employees in relationship to their work performance and created methods to help employees deal with challenges such as job stress. Psychologists have also helped design performance appraisals, decision-making processes, recruitment techniques, and training programs.

BEHAVIORAL SCIENCE DISCIPLINES

Sociology

Sociology looks at the way groups behave and the way they communicate and exchange information in a social setting.

Neck, Organizational Behavior. © SAGE Publications, 2017.

While psychology focuses on the individual, sociology looks at the way groups behave and the way they communicate and exchange information in a social setting. Sociologists have made some valuable contributions to OB within areas such as group dynamics, communication, power, organizational culture, and conflict.

BEHAVIORAL SCIENCE DISCIPLINES

Social Psychology

Social psychology mixes concepts from sociology and psychology and focuses on the way people influence each other in a social setting.

Neck, Organizational Behavior. © SAGE Publications, 2017.

Social psychology mixes concepts from sociology and psychology and focuses on the way people influence each other in a social setting. Social psychologists look at behaviors, feelings, actions, beliefs, and intentions and how they are constructed and influenced by others. They have made significant contributions to reducing the level of prejudice, discrimination, and stereotyping by designing processes to change attitudes, build communication, and improve the way groups work together.

BEHAVIORAL SCIENCE DISCIPLINES

Political Science

Political science studies the behavior of individuals and groups within a political environment.

Neck, Organizational Behavior. © SAGE Publications, 2017.

Political science studies the behavior of individuals and groups within a political environment. Political scientists focus particularly on how conflict is managed and structured, how power is distributed, and how power is abused or manipulated for the purposes of self-interest. Their studies have helped improve our understanding of how different interests, motivations, and preferences can lead to conflict and power struggles between individuals and groups.

BEHAVIORAL SCIENCE DISCIPLINES

Anthropology

Anthropology is the study of people and their activities in relation to societal, environmental, and cultural influences.

Neck, Organizational Behavior. © SAGE Publications, 2017.

Anthropology is the study of people and their activities in relation to societal, environmental, and cultural influences. In a global organizational environment, anthropological research has become even more significant as it increases our understanding of other cultures, and the different types of values and attitudes held by peoples from other countries and organizations.

A Critical Thinking Perspective on Organizational Behavior

Critical Thinkers …

think carefully about the questions they are asked.

base responses on facts or experience rather than emotion or bias.

consider different viewpoints or perspectives equally.

compare responses with similar examples that have occurred in the past.

Neck, Organizational Behavior. © SAGE Publications, 2017.

Your ability to think critically will differentiate you from other applicants. In an interview situation, critical thinkers take the time to think carefully about the questions they are asked, base their responses on facts or experience rather than emotion or bias, consider different viewpoints or perspectives equally, and compare their responses with similar examples that have occurred in the past. Once hired, critical thinkers are more likely to succeed. After all, most companies do not employ graduates to simply go through the motions or to be a mere cog in the wheel. They expect their employees to play a pivotal role in helping the company achieve its organizational goals. And when a company does well, everyone benefits. You do not need to be an expert in critical thinking to get a job, for many of these skills can be learned in the workplace, but employers look for candidates who have a questioning mind, a willingness to embrace change, and a keen desire to learn.

Table 1.1: Applied Skills Dominate Rankings of Knowledge and Skills Expected to Increase in Performance over Next Five Years

Neck, Organizational Behavior. © SAGE Publications, 2017.

A CRITICAL THINKING PERSPECTIVE ON ORGANIZATIONAL BEHAVIOR

SOURCE: Are They Really Ready to Work? Employers’ Perspectives on the Basic Knowledge and Applied Skills of New Entrants to the 21st-Century U.S. Workforce. Study conducted by the Conference Board, Partnership for 21st-Century Skills, Corporate Voices for Working Families, and the Society for Human Resource Management, 2006.

NOTE: Number of respondents varied for each question, ranging from 398 to 424. Percentages calculated out of total number of respondents electing “increase” in importance over the next five years.

Table 1.1: Applied Skills Dominate Rankings of Knowledge and Skills Expected to Increase in Performance over Next Five Years

Figure 1.4 Five steps to managing and changing behavior using critical thinking

Neck, Organizational Behavior. © SAGE Publications, 2017.

A CRITICAL THINKING PERSPECTIVE ON ORGANIZATIONAL BEHAVIOR

SOURCE: Neck, C., et al., Management (Hoboken, NJ: Wiley, 2014): 5.

Let us use an example to further illustrate the five steps of critical thinking methodology. Suppose you are a manager of a restaurant owned by a local businesswoman. Samir, one of your waitstaff, has persistently failed to show up for shifts without giving any meaningful reason. Since Samir is usually reliable, you are puzzled by the extent of his absenteeism. Because you do not have all the facts, you decide to use critical thinking skills to investigate the real source of the problem.

The next time Samir comes to work, you observe the situation objectively, suspending all bias and judgment. You notice that he is abrupt with customers, does not attempt to communicate with his fellow colleagues, and walks across the restaurant with a heavy gait. This helps you to interpret the situation better, giving you enough evidence to deduce that your employee is not happy. You might analyze these effects and think of a way to deal with the behavior. What should you do? You decide to evaluate the situation and assess the consequences of trying to change his behavior. Based on his performance, your boss, Jessica, the restaurant owner, tells you to fire Samir but you explain to your boss why you believe an attempt to change his behavior might be justified and she agrees to give Samir another chance.

You set up a meeting with Samir to discover the reasons behind his unexplained absences and unmotivated behavior at work. Samir apologizes and tells you he has become dissatisfied with his job and would much rather work on the front desk of the restaurant, greeting customers and taking reservations. He says he has been afraid to tell you this because he has been worried he would be letting you down by switching roles. You explain that his absences have already disappointed you but that you are willing to give him a second chance. Following a trial period at the front desk, Samir immediately becomes more motivated and his attendance is impeccable.

A CRITICAL THINKING PERSPECTIVE ON ORGANIZATIONAL BEHAVIOR

Using the Scientific Method to Enhance Critical Thinking in OB

Theory, a set of principles intended to explain behavioral phenomena in organizations.

Research may involve independent (potentially causal) and dependent variables (the outcomes).

Neck, Organizational Behavior. © SAGE Publications, 2017.

The scientific method researchers use to enhance critical thinking in OB begins with a theory, a set of principles intended to explain behavioral phenomena in organizations.21 OB researchers use models, which are simplified snapshots of reality, to find out the reasons behind certain behaviors, such as absenteeism or employee turnover, for example. Connecting the elements of these models are independent variables, which are factors that remain unchanged, and dependent variables, factors affected by independent variables. Researchers then write a prediction called a hypothesis, a statement that specifies the relationships between the two variables. For example, much OB research has been carried out on the correlation, or the reciprocal relationship between two or more factors, between job satisfaction (independent variable) and absenteeism (dependent variable).

A CRITICAL THINKING PERSPECTIVE

ON ORGANIZATIONAL BEHAVIOR

Neck, Organizational Behavior. © SAGE Publications, 2017.

Source: Basic Open System Model. CSAP Institute for Partnership Development. United States Department of Health and Human Servcies

Figure 1.5 Open Systems Theory: Inputs and Outputs

Another part of the scientific method in OB is open systems theory, which holds that organizations are systems that interact with (are open to) their environments and use them to obtain resources, or inputs, and transform them into outputs returned to the environment for consumption.23 According to the theory, all organizations are also unique, and subject to internal and external environmental influences that can affect their efficiency. To ensure the smooth running of an organization, a defined structure should be in place that can accommodate problems and opportunities as they arise.

OB Challenges and Opportunities

Neck, Organizational Behavior. © SAGE Publications, 2017.

Figure 1.6: Challenges and Opportunities Facing Today’s Organization

Globalization: The world has become increasingly connected through trade, culture, technology, and politics.

Economic Factors: Economic events have had a significant effect on the workplace.

Workforce Diversity: The demographic profile is changing.

Customer Service: Organizations are creating customer-responsive cultures.

People Skills: Managers and employees must have excellent people skills.

Innovation and change: Organizations need to simulate innovation and change.

Sustainability: Many organizations are striving to build more sustainability.

OB CHALLENGES AND OPPORTUNITIES

Globalization

Globalization is a process by which the world has become increasingly connected through trade, culture, technology, and politics.

Neck, Organizational Behavior. © SAGE Publications, 2017.

Globalization is a process by which the world has become increasingly connected through trade, culture, technology, and politics. It has had a huge influence on OB. Many organizations now have offices all over the world, and it is not uncommon for employees to move between them. For example, you may be placed on a foreign assignment, where you will be expected to learn a different language and work with people from different cultures and backgrounds. Even at home, you are very likely to be working with people from abroad or with a background different from yours. It is essential to be able to relate well to others, and to demonstrate genuine respect and tolerance for them.

OB CHALLENGES AND OPPORTUNITIES

Economic Factors

Economic events have had a significant effect on the workplace.

Neck, Organizational Behavior. © SAGE Publications, 2017.

Economic events have had a significant effect on the workplace. Recessions and financial crises have led to layoffs, reduced wages, unemployment, bankruptcy, and labor shortages. Organizations are continuously strategizing to overcome economic stumbling blocks by seeking out talent and focusing on the skillset of their workforce to find innovative ways to differentiate themselves from competitors. To flourish in a work environment that is constantly in flux, you will need to be agile, adaptable, and open to learning new skills when required.

OB CHALLENGES AND OPPORTUNITIES

Workforce Diversity

The demographic profile of the united states is changing, and the resulting diversity in the work force is encouraging organizations to foster working environments that do not discriminate.

Neck, Organizational Behavior. © SAGE Publications, 2017.

The demographic profile of the United States is changing, and the resulting diversity in the work force is encouraging organizations to foster working environments that do not discriminate against others regardless of gender, race, ethnicity, age, sexual orientation, or disability.25 In most large organizations, employees are educated about diversity and taught the importance of respecting individual differences. Forming and building good working relationships is central to achieving professional success. You will need to respect others and accept people without prejudice if you want to get ahead in the workplace.

OB CHALLENGES AND OPPORTUNITIES

Customer Service

Organizations are creating customer-responsive cultures to meet the increasing needs and changing demands of their customer bases.

Neck, Organizational Behavior. © SAGE Publications, 2017.

Organizations are creating customer-responsive cultures to meet the increasing needs and changing demands of their customer bases. Companies are striving to understand the customer’s needs first and then tailor the product to their requirements. In most businesses, you will carry out some level of customer service, whether you are dealing with external clients (customers) or internal ones (coworkers). In doing so, you will need to develop a customer-focused attitude and think creatively about how to satisfy their needs.

OB CHALLENGES AND OPPORTUNITIES

People Skills

Managers and employees must have excellent people skills, such as the ability to communicate and interact with others, in order to work harmoniously with their colleagues.

Managers and employees must have excellent people skills, such as the ability to communicate and interact with others, in order to work harmoniously with their colleagues. Being able to relate to other people has just as much impact on success as your technical skills, especially when you are leading and managing teams.

OB CHALLENGES AND OPPORTUNITIES

Innovation and Change

Organizations need to simulate innovation and change by becoming faster and more agile than competitors.

Organizations need to simulate innovation and change by becoming faster and more agile than competitors. Tangible resources such as physical equipment are no longer the mainstay of an organization. The organization’s most important assets are its people, and their ability to continuously create, strategize, innovate, and convert their ideas into quality products and processes. Critical thinking is imperative when it comes to innovation; you will need to question, analyze, and create to come up with new, original ideas that will appeal to your consumers to secure a competitive advantage.

OB CHALLENGES AND OPPORTUNITIES

Sustainability

Many organizations are striving to build a more sustainable and responsible global marketplace by taking environmental factors into consideration during decision-making and goal-setting.

Many organizations are striving to build a more sustainable and responsible global marketplace by taking environmental factors into consideration during decision making and goal setting. Whatever role you play, you will need to take into account the effects your decisions and the decisions of others may have on the environment, your community, and the organization itself.

Global Ethics

Ethics are moral principles that guide our behavior.

“right” versus “wrong” moral answer to these issues.

Ethics are moral principles that guide our behavior. While ethics are useful in helping us make decisions and come to certain conclusions, they do not always give a clear answer to each moral question. For example, complex issues such as abortion and euthanasia have been the subject of strong debate over many years, yet people do not agree on a “right” or “wrong” moral answer to these issues.

By following a code of ethics, however, we can make many decisions based on sound guiding principles.

Three Levels of Analysis in OB

Figure 1.7: The Three Main Levels of Analysis

THREE LEVELS OF ANALYSIS IN OB

Individuals

Individuals are the foundation of organizations, and the way they work and behave makes or breaks a business.

Individuals are the foundation of organizations, and the way they work and behave makes or breaks a business. The role of managers is to integrate individuals into the organization, nurture their skills and attributes, and balance their needs and expectations accordingly. When managers do this successfully, individuals will achieve high levels of job satisfaction, motivating them to work towards attaining organizational goals. For instance, the management at Ed Schmidt Auto, featured in Voices of OB, strives to engage employees from all over the company in projects they are passionate about.

THREE LEVELS OF ANALYSIS IN OB

Teams

Teams or groups exist in all organizations, large or small, and their effective functioning is essential to the success of any organization.

Teams or groups exist in all organizations, large or small, and their effective functioning is essential to the success of any organization. Teams are complex because they consist of many different personalities and attitudes. Managers who understand the dynamics of a team and the way it is structured also better understand the underlying behaviors of individuals within the group. A good example is the British football team “Manchester United” whose players continually cooperate with each other in pursuit of a common goal, in spite of well-documented personality differences and the odd feud.

THREE LEVELS OF ANALYSIS IN OB

Organizations

Organizations provide individuals and groups with the tools and systems to achieve objectives and goals.

Organizations provide individuals and groups with the tools and systems to achieve objectives and goals. The attitudes and behavior of employees are influenced by the way organizations are structured.

For instance, Google’s organizational structure is centered around employees from all disciplines working together to meet goals and generate innovative ideas. Google employees derive job satisfaction from a flexible working structure that provides them the freedom to set their own goals and standards.

Positive OB and High-Involvement Management

Positive organizational behavior focuses on the strengths, virtues, vitality, and resilience of individuals and organizations.

Drawing from a range of organizational research and theories, scholarship on positive organizational behavior focuses on the strengths, virtues, vitality, and resilience of individuals and organizations. The idea is that nurturing the strengths of individuals rather than attempting to “fix” their weaknesses is far more beneficial to achieving organizational goals. Employees will gain more self-confidence and feel more positive about their skills and abilities, leading to better performance. Managers who practice positive OB value human capital as their most important resource.

POSITIVE OB AND HIGH-INVOLVEMENT MANAGEMENT

High-Involvement Management

Empower employees to make decisions.

Provide extensive training and opportunities to increase their knowledge base.

Share important information.

Provide incentives.

Positive OB places the highest priority on the well-being of employees. This style of management is closely linked with high-involvement management, a strategy in which managers empower employees to make decisions, provide them with extensive training and opportunities to increase their knowledge base, share important information, and provide incentive compensation. Increasing employee involvement in this way is a very democratic approach to management, giving all employees, including those who carry out basic duties, a say in how the work is conducted. They are then more likely to work hard, and more willing to adapt to new processes and learn new tasks. Empowered, satisfied employees strive to achieve organizational goals.