Order 157854: Organisational Behaviour

Unit 7.1

Organisational Behaviour

Activity 1 – Report

Effective Leadership Behavior &

Leadership Practice

Student Name: Xxx

Student No: 12345

Date: Xx

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Course Title: Organisational Behaviour

Assignment No. 1

ATHE Level 7 Diploma in Strategic Management

Student Name: Xxx Xxx

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TABLE OF CONTENTS

Activity 1

Effective Leadership Behavior & Leadership Practice ….…………. 01 1.1 Introduction ……………………………………………………………………………… 01 1.1 Evaluation Of Leadership Theories ………………………………………………… 01 1.2 Evaluation Of The Impact Of Managerial Styles On Organizational Effectiveness …………. 03 1.3 Analyzing How Motivational Theory Can Inform Employee Motivation ……………………………………….. 06 1.4 Analyzing How Theories Relating Towork Relationships And Interaction ………….. 08

Activity 2 Organizational Structures and Culture impact on the effectiveness of the Organization ………………………………………………………………………………. 11

(Presentation Attached Separately)

Activity 3 An Analysis Of The Culture, Structure Of A Chosen Organization And Its Effectiveness ……………………………………………………………….. 12 3.1 Introduction …………………………………………………………………………………. 12 3.2 Structure Of NBAD ……………………………………………………………………….. 12 3.3 Culture Of NBAD …………………………………………………………………………………. 13 3.4 An Analysis Of The Culture & Structures Impact On NBAD ……………. 14

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Activity 4

Approaches, Risk & Uncertainty In Decision Making ………………….. 15 4.1 Diifferent Approaches To Organisational Decision Making ……..……………. 15 4.2 Management Approaches To Risk & Uncertainty In Decision Making ……………..………………… 17 4.3 Effectiveness Of Organizational Decision In NBAD ……………………………….. 18

References ………………………………………………………………..………………….………. 19 List Of Exhibits ……………………………………….………………………………………… iv

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List Of Exhibits ( Tables / Figures )

Exhibits No Page No

(i) The Relationship Among Leadership Variables 02

(ii) Different Management Styles 04

(iii)The features and the impacts of Management Style 04

(iv) Hieararchy Of Needs 06

(v)Motivation Theories 07

(vi) Powers in Organizations 08

(v) Power and Dependences 09

(vi) NBAD Organizational Structure 13

(vii) Decisions Making Environments 15

(viii)Decision Making Styles 16

(ix)Decision Making Conditions 17

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Activity 1

EFFECTIVE LEADERSHIP BEHAVIOUR & LEADERSHIP PRACTICE. 1 INTRODUCTION Moral leaders are made not born. To be an effective leader you should have the desire and determination.

It is a process of never ending education, training, self-study and experience that leaders are mold of(Jago,

1982).

An organizations performance depends on its leadership. Therefore the leadership of any organization is

very critical. When a good leadership is in place in a Company, it could be felt throughout the entire

organization (Anderson, 2013).A solid leadership will be the key for a Company to be a market leader

(Schein, 1985).

Leadership is where a leader influences the employees to achieve the aims, goals and the objectives of the

organization. These are achieved by leaders by applying leadership attributes such as ethics, character,

skills, knowledge, values and beliefs (Bennis, 1989).

To understand leadership there are countless research studies carried out by various researchers the

outcome of these studies shows some research are exceptionally useful, some have contradictory results

and some are unclear (Bass and Bass, 2008).

It is not the CEO, it’s the Leadership Strategy that matter. Long term business performance comes from

leadership culture and continuous development of leadership at all levels which will ultimately thrive

business (Bersin, 2012).

1.1 EVALUATION OF LEADERSHIP THEORIES Leadership theories have been the result of numerous studies. It is an assumption about distinguishing

characteristics of a specific kind of leader. Most of the theories falls in to one or more of the following tree

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perspectives, (i) Leadership as a relationship or process (ii) Leadership as a combination of personal

characteristics or traits (iii) Leadership skills or certain behaviors (Wolinski, 2010).

Exhibit (i) The relationship among Leadership Variables

Source: Author (2015) The following Leadership Theories will enable to define a leaders characteristics.

Leader Traits

and Skills

Leader

Behaviors

Follower

Attitudes and

Behaviors

Performance

Outcomes Influence

Processes

Situational

Factors

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Trait Theory – What type of a Person Makes a Good Leader? Trait leadership theory suggest that peoples are either born or are made with certain qualities which will make them success leaders. Such qualities as intelligence, creativity, sociability, self-confidence and courage are considered to be linked to great leaders (Matthews et al., 2003).

Advantages

 Trait Theory totally depends on hard data or a statistical analysis.

 Provides an understanding and a complete knowledge of the leader and elements of leadership.

 The theory provides a yardstick for identifying leaders.

Disadvantages

 Some behaviors should not always be inherited but could acquire through training.

 Environmental factors are not taken into consideration as it could differ from situation to situation.

 The qualities needed to achieve leadership will differ from the requirements needed to sustain leadership.

Advantages

* Trait Theory totally depends on hard data or on statistical analysis.

* Provides an understanding and a complete knowledge of the leader and elements of leadership.

* The theory provides a yardstick for identifying leaders.

Disadvantages

* Some behaviors should not always be inherited but could acquire through training.

* Environmental factors are not taken into consideration as it could differ from situation to situation.

* The qualities needed to achieve leadership will differ from the requirements to sustain

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Behavioral Theory – What does a good leader do? This theory is based upon the belief that great leaders are made not born. It focuses on the actions of the leader which will define the leadership ability. The famous behavioral theory was originated by the University of Michigan and the Ohio State University. It identified two key behavioral categories of “orientation towards task and towards people (Jaimovich and Rebelo, 2006). Advantages

 Behavioral Theory allows managers to find the right mix between different styles

of leadership further enabling them to act depending on the productivity and

concerns of people.

 Gives simulation to the value of leadership styles with a prominence on teamwork and

importance for people.

 This theory enable Managers to ascertain the effects of their behavioral style on

achievement of organizational goals and relationship with colleagues.

Disadvantages

 Although Behavioral theory recommends leadership styles a precise leadership style will

not be the most suitable in all circumstances.

 The difficulty of segregating which leadership style was more effective in enabling one

team to work well than the other team.

 The initial leadership theory that was to be implemented could be far more ineffective

rather than to the styles that leaders develop according to the environment and

according to the people they work with.

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Contingency Theory – How does the situation Influence Good leadership? The theory states a leader’s effectiveness depends how well the leader’s style matches a precise situation or setting. A method used for handling a situation will not be applicable in a different situation. In other words a leader who is successful in one situation might fail when the situation changes. Further a leader could perform at the maximum level in a certain situation but minimal performance when taken out of their element (Yukl and Waxley, 1985). Advantages

 Enables leaders to know the exact task they are responsible for without any

misperception.

 In Contingency theory leaders are not categorized or discriminated according to their

social or ethnic backgrounds, work experience or gender.

 The theory does not confine that all leaders should be effective in all situations further it

enables to develop close relationship between workers and leaders.

Disadvantages

 Unable to rectify and generate a solution if a mismatch occurs between workplace

situation and the leader.

 Not able to clarify why certain leadership styles are more appropriate in some situations

and inappropriate in other instances.

 Doubts are raised regarding the Least Preferred co-worker (LPC) scale as it do not relate

well with other standard leadership procedures.

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Great Man Theory – Is great leaders made or born?

The assumption in the Great Man Theory is that great leaders are born and not made. This theory emphasizes leaders who are destined by birth to become a leader and is born with necessary characteristics such as confidence, intelligence, social skill and charisma. They are destined to rise to leadership when needed (Carlyle et al., 1993).

Advantages

 The leadership qualities that a leader is born with is necessary and sufficient to

exercise influence over people and become successful.

 Anyone cannot desire to become a leader and conquer greatness.

 One individual could inspire and effect a change single handed.

Disadvantages

 Mythical belief of leaders becoming successful and great leaders independent of

their environmental situations.

 No scientific evidence.

 Leadership is limited to certain community.

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Management Theory – How rewarding a Leader could be? This theory is known as Transactional Theory as well. It is characterized as a transaction made between the leader and the follower. The theory assumes that employees are motivated strictly by Reward or Reprimands. It strictly focuses on task, provides clear direction and administers productivity in detail. When employees perform they are rewarded and when failed they are penalized (Bass et al., 1990). Advantages

 Powerful Motivator as tangible incentives and rewards such as cash is a proven

motivator.

 Easy to follow and clear structure – This approach leaves minimum confusion or

doubt among managers and subordinates as it is clear and straightforward if a

task is completed you are entitled for bonus, overtime or health benefits.

 Fast results and short term goals – An effective method for solving business issue

in short term where by offering extra remuneration if targets are achieved.

Disadvantages

 Negative on creativity and thinking skills since goals and objectives goals cannot

be defined only with set of procedures.

 This is not perfect since rewards and punishments will motivate only people on

the base level and will not motivate the higher level people.

 Flexibility roles - When required sometimes according to the demand leaders

have to change from one role to another therefore transactional leaders will be

limited in their effectiveness.

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Relationship Theory – How influencial is a Leader? Relationship theory is known as Transformational Theory as well. This process is where a leader interact with subordinates and creates a solid relationship which will result a high level of personal integrity leading to an increase in motivation and morality. The leader focuses on group performance but will insist each employee to perform to the maximum potential. This style of leaders have high moral and ethical standards (Bass and Bass, 2008). Advantages

 Transformational leaders are frequently involved in the development of employees and the growth of the company. As the organization expands the leaders are more involved and keep a close contact with the employees.

 The leaders reach out to employees and bring out the best in them and further helps them in developing career growth which enables to create a strong bond between the leader and the employees thus creating a high employee retention mechanism.

 Transformational leaders crafts an enthusiastic work atmosphere and inspire

staff to be more productive and work towards accomplishing organizational

goals.

Disadvantages

 Depends on an individual’s ability and charisma to inspire the workforce and if

the leader acts unethically or dishonestly the entire operation and the

organization will suffer.

 Transformational leadership is mainly established on Qualitative data.

 According to Transformational theory a leaders inspiration is the key for success

however if unreasonable deadlines, unacceptable working conditions or long

working hours might cause employees not to inspire to work.

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1.2 EVALUATION OF THE IMPACT OF MANAGERIAL STYLES ON ORGANISATIONAL EFFECTIVENESS. Managerial styles are one of the important features that have an impact on organizational effectiveness. The effectiveness is significantly determined by the way employees work and by the way work is organized. Further how employees cooperate with each other, with the community, with the leadership and the level of commitment to the organization mostly depends on the style of the management (Davidmann, 1981). Management styles influence the way the Company make decisions on strategy, formulating, branding, marketing and dealing with stake holders (Khandwalla, 2008). Exhibit (ii) Different management styles

Source: Author (2015) Exhibit (iii) Thefeatures and the impacts of Management Style

Management Styles

Autocratic

Democratic

Laissez- fairev

Paternalistic

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Management Style

Features Impact

Autocratic

Or

Authoritarian

* Centralizes power and decision making to himself. * Gives orders, assigns tasks, and duties without communicating with employees. * Do not invest any trust in the employees. * Leader takes full authority and assumes full responsibility.

* This method suits to Companies where quick decisions have to be made and controlling large number of employees. * Employees will depend upon leaders and there will be lack of creativity therefore supervision will be needed. * Staff motivation will decrease and staff turnover will increase. * Misuse of authority will lead to strikes and disputes.

Democratic Or Participative

* Everyone is involved in decision making process therefore everything is agreed on majority.

* Encourages participation in decision making and shares information.

* Leads the employees mainly through persuasion and example rather than force and fear.

* Improves job satisfaction and productivity.

* Increases cooperation with the management.

* High employee turnover.

* This process slows down decision making as the opinion of employees are considered. Therefore managers will not be able to implement the best decision.

Laissez-faire or Free-rein

* Avoids power and Authority and delegates much authority to employees.

* The leader acts as an umpire and the employees manage their own area of business.

* No direction or authority is exercised over the employees.

* This brings out the best in highly professional and creative groups of employees.

* Leads to lack of staff focus and sense of direction which in turn leads to dissatisfaction and poor Company image.

* Less productive.

Paternalistic

* Paternalism means “Papa knows best” which leads to a fatherly or paternal leadership. * When making decisions focuses on social and recreational needs of employees.

* This leadership style was successful in Japan and best suited for family (small) business. * Effective in keeping the employee moral high. * Employees will work harder out of gratitude.

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* Information flows from top to bottom. * The leader protects and guides his employees as members of the family.

Source:Beehr (1987)& Brookfield (2000)

1.3 ANALYZING HOW MOTIVATIONAL THEORY CAN INFORM EMPLOYEE MOTIVATION. “Motivation” is and continues to be a topic that draws interest on employers and researchers. Many philosophers base their knowledge on motivation to a mental satisfaction. The cause for employees to be motivated or demotivated have been researched comprehensively over many decades thus resulting a wealth of motivation theories. Motivation is described as the will to achieve its goals (Bedeian, 1993), further it is defined as the psychological process that gives behavior purpose and direction (Kreitner, 1980). It is also defined as the inner force that drives individuals to accomplish organizational and personal goals and to satisfy an unsatisfied need (Higgins, 1991). The most focused Motivation theory is Maslow’s ‘Hierarchy Of Needs’. Exhibit (iv) Hieararchy Of Needs

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Source: Maslows (1943) Exhibit (v) Motivation Theories

Content Theory

Focus on Human needs and how people with different needs react to different work situations (Job Satisfaction and behavior).

Process Theory

Emphasis on individual’s reactions and making choices based on rewards, preferences and accomplishments.

Hierarchy Needs Theory (Abraham Maslow, 1943) – Maslow suggested that motivation is a result of a person trying to fulfill five basic needs. There needs are has a pyramid hierarchy that will satisfy from bottom to top. When lower needs are fulfilled a higher need is seek out. Once the lower needs are fulfilled it will no longer serve as a source of motivation.Further Maslow stated that people are motivated both Intrinsically and Extrinsically. The five main needs are,

Equity Theory (J Stacy Adam, 1963) –The theory suggests that if an individual perceives that a reward received is equitable when compared to the others received in similar position then the individual is satisfied. On the other hand when treated unfairly in comparison to others they try to eliminate the unjust and try to restore a perceived sense of equity to the situation. Further it is stated that employees pursue to maintain equity between what they bring in to the job and the benefits they receive from it against the perceived inputs and outcomes of other

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[i]. Physiological (Air, water)

[ii] Safety (Security, Health)

[iii] Social / Belonging (Family, Friends)

[iv] Esteem (Achievement, Respect)

[v] Self-actualization (Potential, Morality)

colleagues.

Two Factor Model Theory(Frederick Herzberg, 1959)-Theory implies that there are certain factors in workplace that cause Job Satisfaction and certain elements that cause dissatisfaction. The two are,

(i) Hygiene Factor – Sources of job Dissatisfaction (Company polices, Supervision).

(ii) Motivator Factor – Sources of Job satisfaction and motivation (Achievement, Recognition).

Expectancy Theory (Victor H. Vroom, 1964)–The theory states that the motivation to behave in a specific way is determined by an employee’s expectation that behavior will lead to a certain outcome multiplied by the valence or preference that the employee has for that outcome. If Motivation (M), Expectancy (E), Instrumentality (I) and Valence (V) are presented in an equation,

M = E x I x V

If either variable E,I or V is low the motivation will be low.

ERG Theory (Clayton Alderfer, 1969) – It is a simplification of Maslow’s theory by categorizing hierarchy of needs into three categories.

[i] Existence Needs – It is a merger of Physiological and Safety Needs.

[ii] Relatedness Needs – It is as Social or Belonging needs.

[iii] Growth Needs – It is a merger of Esteem and self-actualization.

Goal Setting Theory(Edwin Locke, 1968)–The theory asserts that motivation and performance will be high if employees are set specific goals and managed well. The key principles of Goal setting are,

[i]Setting specific goals.

[ii] Clarifying goal priorities. [iii] Setting challenging goals

[iv] Building goal commitment and acceptance.

[v] Rewarding goal accomplishments.

[vi] Providing feedback on goal accomplishments.

1.4 ANALYZING HOW THEORIES RELATE TO WORK RELATIONSHIPS AND INTERACTION. Organizations consist of groups of people who work together for the achievement of common goals. Therefore building relationships in work place is vital in order to successfully perform your job. Power could be increased through Social Capital, Referent Power, Visibility and Centrality Contingencies (Lucas, n.d.).

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Exhibit (vi) Powers in Organizations

Source: Author, 2015 Power plays a major role in relationships therefore power is the capacity of a person, organization or a team to influence others (Demers, 2015). Exhibit (vii) Power and Dependences

Source: Author, 2015 We are destined as humans to live together in society and to depend one another as it is impossible to survive (Black, 2004). There are many strategies that could be adapted to develop characteristics at work place. Mentioned below are few characteristics,

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Consistency – The fastest way to ruin a reputation is inconsistency. If work is delivered on time consistently, eventually a leader will be considered reliable (Birman and Glade, 1995).

Respect –When people respect each others’ opinion it helps in problem solving. Respectful interaction is considered honest and tactful (Birman and Glade, 1995)..

Rather than Argument Emphasis on Action –Performing well and getting good results consistently verifies the ability to walk the walk. To get to the next step the ideas should be shown through your actions without arguing the structure will work in theory. A best leader will always talk through actions (Goodman, 2013).

Good conversation – Influence is a two way street. The more you believe and communicate with your colleagues it will be possible to incorporate their ideas to your vision. Respect and acknowledge everyone’s opinions and let your colleagues know they are valued (Gerson and Gerson,2007).

Building trust with Co-workers & loyalty – The way to success is trusting your colleagues where relationships seek input from one another and allow individuals to do their jobs without unnecessary supervision. Trust includes fundamentals such as accountability, honesty and support. The ability to be loyal at workplace is highly prized (Goodman, 2013).

Name-ID-OB-Sample Assignment1 A2.pdf