Organisational Behaviour

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ORGANISATIONAL BEHAVIOUR

Dr. ANANDA KUMAR Professor Department of Mgt.
Studies Christ College of Engg.
Tech. Puducherry, India. Mobile [phone]
42433 E-mail searchanandu_at_gmail.com
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• Unit 1
• Organisational Behaviour Introduction,
  Definition, Nature Scope Basic Concepts of OB.
  including, Behaviour Individual
  organizational, and Self Image includes
  discussion on self esteem self efficacy
  Introduction to the theoretical constructs and
  models of Organisational Behaviour.

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Organisational Behaviour

• OB is directly concerned with the
  understanding, prediction, and control of human
  behaviour in organisations. - Luthans
• OB is a field of study that investigates the
  impact that individuals, groups, and structure
  have on behaviour within organisations for the
  purpose of applying such knowledge towards
  improving an organisations effectiveness. -
  Stephen P. Robbins

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Objectives of OB

OBJECTIVES OF ORGANISATIONAL BEHAVIOUR
To Describe Behaviour
To Influence Behaviour
To Predict Behaviour
To Understand Behaviour
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Key Elements of OB
People
Structure
Key Elements Of OB
Technology
Environment
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Nature of OB

1. It focuses on the behaviour of individuals
2. It is inter-disciplinary
3. It is an applied science
4. It is an art as well
5. It adopts a humanistic approach
6. Its ultimate aim is to attain the organisational
   objective

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Scope of OB
Group Dynamics Group Conflicts Communication Leade
rship Power Politics
Personality Perception Attitudes Motivation Job
Satisfaction Learning Values
GROUPS
INDIVIDUALS
OB
Structure Culture Change Development
STRUCTURE
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Organisational Behaviour Models
Custodial
Models of Organisational Behaviour
Supportive
Autocratic
Collegial
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The Autocratic Model

• Under the autocratic model, the manager uses his
  authority and directs the subordinates to do the
  work as per his specifications. The subordinates
  are not given the freedom to act. They have to
  carry out the task faithfully as per their bosss
  instructions.
• Thus under the autocratic model, the employees
  are made to work like machines. The use of such
  an approach may not always give the manager the
  desired results. In the long run, the employees
  may develop frustration and may be prone to
  stress conditions. Their physical or mental
  health may get affected. The organisation may
  also begin to face such behavioural problems as a
  high rate of absenteeism, low morale, high rate
  of labour turnover and so on.

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Custodial Model

• If under the autocratic model the employee has to
  depend on his boss all the time, under the
  custodial model he has to depend on the
  organisation. The organisation takes care of all
  the needs of the employees. This is done by the
  introduction of a number of welfare measures like
  rent free accommodation, subsidised food, free
  education for the children of employees and so
  on. Such welfare measures make the employees
  dependent on the organisation that becomes their
  custodian.
• Under the custodial approach the employee is
  happy as the organisation satisfies his needs.
  But there is no guarantee that his performance
  level will be high. A happy and satisfied
  employee need not be a productive employee.

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Supportive Model

• In this case the manager supports his
  subordinates in the performance of their tasks.
  The focus here is on managerial leadership rather
  than on the exercise of authority or fulfillment
  of subordinates needs. The manager does not
  make unilateral decisions but involves his
  subordinates in the decision-making process.
• The supportive model is suitable in those
  workplaces where the employees are
  self-motivated. It has greater relevance for
  managerial personnel rather than the operative
  level workers.

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Collegial Model

• In the collegial model the manager participates
  in the process of task performance by the
  subordinates. In other words, the manager and
  the subordinates work as a team. There is better
  interaction among the team members. Such an
  approach is suitable where every subordinate is
  able to be self-disciplined.
• The basic foundation of the collegial model lies
  on managements building a feeling of partnership
  with employees. Under collegial approach,
  employees feel needed and useful. They consider
  managers as joint contributors to organisational
  success rather than as bosses.

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Autocratic Custodial Supportive Collegial
Basis of model Power Economic Sources Leadership Partnership
Managerial Orientation Authority Money Support Teamwork
Employee Orientation Obedience Security Benefits Job Performance Responsible behaviour
Employee psychological result Dependence on boss Dependence on organisation Participation Self-discipline
Employee needs met Subsistence Security Status and recognition Self-actualization
Performance result Minimum Passive cooperation Awakened drives Moderate enthusiasm
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ORGANISING

• Organising is the process of identifying and
  grouping of activities required to attain the
  objectives, delegating authority, creating
  responsibility and establishing relationships for
  the people to work effectively.

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NATURE OF ORGANIZATION

1. Common Objectives
2. Specialization or Division of Labour
3. Authority of Structure
4. Group of Persons
5. Co-ordination
6. Communication
7. Environment
8. Rule and Regulations

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SPAN OF CONTROL or SPAN OF MANAGEMENT

• Span of management means the number of people
  managed effectively by a single superior in an
  organization.
• The term Span of management is also known as
  Span of supervision, Span of authority and
  Span of responsibility.
• If the number of members is too large, it will
  be very difficult to manage the persons and
  perform the work effectively.

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FORMAL ORGANISATION

• A formal organisation typically consists of a
  classical hierarchical structure in which
  positions, responsibility, authority,
  accountability and the line of command are
  clearly defined and established.
• Each and every person is assigned the duties and
  given the required amount of authority and
  responsibility to carryout the job.
• The inter relationship of staff members can be
  shown in the organisation chart and manuals

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INFORMAL ORANISATION

• Informal organisation is an organisation which
  establishes the relationship on the basis of
  members interaction, communication, personal
  likings and disliking, and social contacts within
  as well as outside the organisation.
• It arises naturally on the basis of friendship or
  some common interest which may or may not be
  related with work.

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ORGANISATIONAL CHARTS

• Organisational charts are prepared for the
  purpose of describing the organisational
  structure clearly.
• An organisation chart is a graphical portrayal of
  the various positions in the enterprise and the
  formal relationships among them.
• It shows the organisational relationships and
  activities within an organisation.

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KINDS OF ORGANISATION CHARTS

• 1. Vertical Chart
• 2. Horizontal Chart or Left to Right Chart
• 3. Circular Chart or Concentric Chart

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• 1. Vertical Chart

Chairmen
Managing Director
Marketing Manager
Production Manager
Personnel Manager
Supervisor for Operation B
Supervisor for Operation A
Supervisor for Operation C
Workman III
Workman II
Workman I
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• 2. Horizontal chart or Left to right chart

Managing Director
Salesman I
Branch Manager I
President
Salesman II
Branch Manager II
Managing Director
Managing Director
Managing Director
Salesman III
Branch Manager III
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• Circular Chart or Concentric Chart
• Supervisor III
• Supervisor II
• Supervisor I

Production Marketing Manager
Manager Personnel Finance Manager
Manager
Chairman
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STEPS IN ORGANISING PROCESS

• 1. Determination of Activities
• 2. Grouping of Activities
• 3. Assignment of Duties
• 4. Delegation of Authority
• 5. Establishment of Structural Relationship
• 6. Co-ordination of Activities

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DEPARTMENTATION / FUNCTIONAL DEPARTMENTATION

• Departmentation means the process of grouping of
  similar activities of the business into
  department, division or other homogeneous units.
  It is used for the purpose of facilitating smooth
  administration at all levels.
• Departmentation involves grouping of people or
  activities with similar characteristics into a
  single department or unit.

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DEPARTMENTATION BY DIFFERENT STRATEGIES

• 1. Departmentation by Numbers
• 2. Departmentation by Time
• 3. Departmentation by Enterprise Function
• 4. Departmentation by Territory or Geography
• 5. Departmentation by Customers
• 6. Departmentation by Process or Equipment

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1. Departmentation by Numbers

• In this case, departments are created on the
  basis of number of persons forming the
  department. Similar types of activities are
  performed by small groups.
• In such case, the each group is controlled by a
  supervisor or an executive.
• For example, in the army soldiers are grouped
  into squads on the basis of the number prescribed
  for each unit.

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2. Departmentation by Time

• Under this base, the business activities are
  grouped together on the basis of the time of
  performance.
• For example, a manufacturing unit working in
  three shifts of eight hours each per day may
  group the activities shift wise and thus having
  separate department for each shift.
• The basic idea is to get the advantages of people
  specialized to work in a particular shift.

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• Departmentation by Enterprise Function

President
Vice-president
MD
Finance Dept
Personnel Dept
Production Dept
Marketing Dept
Production Planning
Financial Planning
Market Research
Recruitment Selection
Production Engineering
Budgets
Market Planning
Training
Purchasing
General Accounting
Sales Administration
Tooling
Labour
Advertising
Cost Accounting
Repairs
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• 4. Departmentation by Territory or Geography

President
Managing Director
Northern Region
Central Region
Western Region
Southern Region
Eastern Region
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• Departmentation by Customers

Branch Manager
Manager Housing Loans
Manager Business Loans
Manager Cooperative Loan
Manager Personal Loans
Manager Agricultural Loans
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6. Departmentation by Process or Equipment
President
General Director
Ginning
Weaving
Spinning
Packing Sale
Dying Printing
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• 7. Departmentation by Product or Service

General Manager
Automobile
Heavy Engg Division
Finance
Sales
Finance
Sales
Personnel
Production
Personnel
Production
Power Products Division
Earth Moving Equipment Division
Finance
Sales
Finance
Sales
Personnel
Production
Personnel
Production
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 AUTHORITY

• According to Hendry Fayol, Authority is the
  right to give orders and the power to exact
  obedience.
• Koontz and ODonnell have defined authority as,
  Authority is the power to command other to act
  or not to act in a manner deemed by the possessor
  of the authority to further enterprise or
  departmental purposes.

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LINE AUTHORITY or LINE ORGANISATION

• Line authority exists between superior and his
  subordinate.
• Line authority is the direct authority which a
  superior exercises over a number of subordinates
  to carry out orders and instructions.
• In organisation process, authority is delegated
  to the individuals to perform the activities.

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Manager
Superintendent 1
Superintendent 2
Foreman 1
Foreman 1
Foreman 2
Foreman 2
W
W
W
W
W
W
W
W
W
W
W
W
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STAFF AUTHORITY

• Staff authority is exercised by a man over line
  personnel.
• The relationship between a staff manager and the
  line manager with whom he works depends in part
  on the staff duties.
• In a management, staff refers to those elements
  of the organisation which help the line to work
  most effectively in accomplishing the primary
  objectives of the enterprise, the nature of the
  staff relationship is advisory.

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DECENTRALISATION OF AUTHORITY

• Centralization and decentralization refer to the
  location of decision-making authority in an
  organisation.
• Centralization means that the authority for
  most decisions is concentrated at the top of the
  managerial hierarchy whereas decentralisation
  requires such authority to be dispersed by
  extension and delegation through all levels of
  management.

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DELEGATION OF AUTHORITY

• Delegation of authority is a process which
  enables a person to assign works to others and
  delegate them with adequate authority to do it.
• Delegation consists of granting authority or the
  right to decision-making in certain defined areas
  and charging the subordinate with responsibility
  for carrying through an assigned task

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MANAGING BY OBJECTIVES (MBO)

• MBO is a process whereby the superior and the
  subordinate managers of an enterprise jointly
  identify its common goals define each
  individuals major areas of responsibility in
  terms of results expected of him, and use these
  measures as guides for operating the unit and
  assessing the contribution of each of its
  members.
• - George Odiorne

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Conti.

• MBO is a process whereby superiors and
  subordinates sit together to identify the common
  objectives and set the results which are to be
  achieved by the subordinates.

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THE PROCESS OF MBO

• 1. Setting Preliminary objectives
• 2. Fixing Key result areas
• 3. Setting subordinates objectives
• 4. Recycling objectives
• 5. Matching resources with objectives
• 6. Periodic performance reviews
• 7. Appraisal

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WEAKNESS OF MBO

• Failure to teach the philosophy of MBO
• Failure to give guidelines to goals setters
• Difficulty of setting goals
• Emphasis on short-term goals
• Danger of Inflexibility
• Time consuming
• Increased paper work

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REASONS WHY MBO FAIL

• Lack of top management involvement and support.
• Lack of understanding of the philosophy behind
  MBO.
• Difficultly insetting realistic and meaningful
  objectives.
• Increased time pressure.
• Lack of relevant skills.
• Lack of individual motivation.
• Poor integration with other systems

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Case Study

• As a part of the companys management development
  programme, a group of managers from various
  functional areas have devoted several class
  sessions to a study of motivation theory and the
  relevance of such knowledge to the managers
  responsibility for directing and controlling the
  operations of his organizational units. One of
  the participants in the programme is Ashok Seth,
  who has been a Supervisor in the Production
  department for about a year. During the
  discussion session, Ashok seth, made the
  observation

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Case Study

• Motivation theory makes sense in general, but
  there is really no opportunity for me to apply
  these concepts in my job situation. After all,
  our shop employees are unionized and have job
  security and wage scales that are negotiated and
  are not under my control. The study of
  motivation concepts has given me some ideas about
  how to get my sons to do their home work, but it
  has not given me anything I can use on the job.
  Further more, in a working situation, we are all
  dealing with adults, and it seems to me this
  reward and punishment thing smacks of personal
  manipulation that just wont go over with people.

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Case Study

• Questions
• What is the problem in this case?
• In what respects Ashok Seth is correct in his
  comment about not having any opportunity to apply
  motivational concepts in his job situations?
• Offer practical suggestions to apply motivational
  concepts in job situations.

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• Unit 2
• Perception and Learning Personality and
  Individual Differences Motivation Content
  Process Theories of Work Motivation - and Job
  Performance Personal Values, Attitudes and
  Beliefs Conflicts Stress Concept, why and
  how Management

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Perception

• Perception can be defined as a process by which
  individuals organise and interpret their sensory
  impressions in order to give meaning to their
  environment.
• Perception is an important mediating cognitive
  process through which persons make
  interpretations of the stimulus or situation
  they are faced with.
• Perception is the process of becoming aware of
  situations, of adding meaningful associations to
  sensations.

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• Unit 2
• Perception and Learning Personality and
  Individual Differences Motivation Content
  Process Theories of Work Motivation - and Job
  Performance Personal Values, Attitudes and
  Beliefs Conflicts Stress Concept, why and
  how Management

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Perception

• Perception is the process of receiving
  information about and making sense of the world
  around us. It involves deciding which
  information to notice, how to categories that
  information, and how to interpret it within the
  framework of our existing knowledge shape
  opinions, decisions and actions.

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Perception

• Perception can be defined as a process by which
  individuals organize and interpret their sensory
  impressions in order to give meaning to their
  environment.

• Peoples behaviour is based on their perception
  of what reality is, not on reality itself.
• The world as it is perceived is the world that
  is behaviourally important.

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The mind forms shapes that don't exist
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Man/Woman
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Sensation and Perception

• Sensation is the response of a physical sensory
  organ
• Eyes see
• Ears hear
• Hands touch
• Nose smell
• Tongue taste
• Sensation, thus, is essentially a physical
  process.
• Perception, on the other hand, is essentially a
  psychological activity. It correlates,
  integrates and comprehends diverse sensations to
  arrive at a meaningful conclusion. Sensation,
  thus, provides the basis for perception.

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Process of Perception
REACTING
CHECKING
INTERPRETING
ORGANISING
SELECTING
RECEIVING
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Process of Perception

• Stage I Receiving Stimuli
• Stage II Selecting Stimuli
• Stage III Organising Stimuli
• Stage IV Interpreting Stimuli
• Stage V Checking Stimuli
• Stage VI Reacting to Stimuli

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Learning

• Modification of behaviour taking place through
  observation, training or practice is what is
  called learning.
• Learning is the process of having ones
  behaviour modified, more or less permanently, by
  what he does and the consequences of his action,
  or by what he observes
  - Munn and others
• Relatively permanent change in behaviour
  potentiality that results from reinforced
  practice or experience - Steers and
  Lyman

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Nature or Characteristics of Learning

1. Learning results in change in behaviour.
2. The change may be good or bad. It must be
   remembered here that a person acquires certain
   bad habits like smoking or drinking only through
   learning.
3. The change must be relatively permanent.
   Behavioural change caused by fatigue is only
   temporary and it involves no learning.
4. A mere change in ones thought process or
   attitude is not learning. It must be accompained
   by a change in behaviour as well.

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Cont

1. Any change in behaviour due to ageing, illness or
   injury is not the result of learning. A change
   in behaviour is deemed to be the outcome of
   learning only it arises out of observation,
   training or practice.
2. Any positive change has to be permanent. To
   achieve permanency, the practice needs to be
   reinforced, supported or strengthened. In the
   absence of reinforcement, the expected behaviour
   will gradually disappear.
3. Learning is a continuous process. It is not
   something that occurs only during a particular
   stage in ones life.

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Factors determining Learning
Environment
Motivation
Determinants of Learning
Practice
Qualities of the Trainer Trainee
Meaningfulness of The subject
Feedback
Time Schedule
Reinforcement
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Theories on Learning

• 1. Classical Conditioning Theory
• 2. Operant Conditioning Theory
• 3. Cognitive Theory
• 4. Social Learning Theory

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Classical Conditioning

• The credit for developing the classical
  conditioning theory is given to Ivan Pavlov, a
  Russian psychologist.
• Learning is the process by which experience or
  practice results in a relatively permanent change
  in behavior or potential behavior.

Ivan Pavlov
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Cont.

• Classical conditioning is modifying behaviour so
  that a conditioned stimulus is paired with an
  unconditioned stimulus and elicits an
  unconditioned behaviour.
• The classical conditioning theory is based on
  Pavlovs experiments to teach a dog to salivate
  in response to the ringing of a bell. Pavlov
  offered the dog meat and noticed that the dog was
  salivating. Afterwards, without offering meat,
  be merely rang a bell. The dog had no
  salivation.

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Cont.

• As the next step he rang the bell before giving
  the dog meat. This went on for sometime.
  Thereafter, Pavlov merely rang the bell without
  offering meat and noticed that the dog was
  salivating. The dog, thus, learnt to relate the
  ringing of the bell to the presentation of meat.
• The classical conditioning theory has some
  relevance in understanding human behaviour in
  workplaces. For example, the employees can link
  their pay hike to the better financial position
  of their employer. In other words, they expect a
  hike in their pay when they know that the
  financial position of the organisation is very
  sound.

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Cont.

• The classical conditioning theory, however, has
  certain limitations. For example, it does not
  explain all aspects of human learning. The
  environment in the organisation also makes
  understanding of human learning difficult.

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Theories on Learning

• kjals

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Operant Conditioning Theory

• B.F. Skinner (1904-1990)
• developed behavioral technology
• the relationship between behavior and its
  consequences

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Cont..

• B. F. Skinner made the law of effect the
  cornerstone for his influential theory of
  learning, called operant conditioning.
• According to Skinner, the organisms behavior is
  operating on the environment to achieve some
  desired goal.
• Operant Chamber (Skinner Box) soundproof
  chamber with a bar or key that an animal can
  manipulate to obtain a food or water reinforcer
  contains a device to record responses
• The fundamental principle of behaviorism is that
  rewarded behavior is likely to be repeated.

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Cont.
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Cont

• Operant conditioning is voluntary behaviour and
  it is determined, maintained and controlled by
  its consequences.
• The tendency to repeat a specific behaviour is
  influenced by reinforcement (i.e., strengthening
  a behaviour by rewards), or the lack of
  reinforcement, resulting from the consequences of
  the behaviour.
• Positive reinforcement increases the chance of
  the behaviour being repeated. Thus rewards (eg.
  Pay rise, greater freedom, appreciation etc.) are
  used by organisations to improve productivity
  (i.e., desired behaviour).

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Cont

• It has also been observed that when a behaviour
  is not rewarded or is punished (negative
  reinforcement) it is seldom repeated. Operant
  conditioning is a useful technique with which
  organisations can induce desired behaviour.
• Operant conditioning is an effective tool for
  managing people in organisations. Most of the
  individual behaviours in organisations are
  learned, controlled and altered by the
  consequences. The operant conditioning is used
  by the management as a process successfully to
  control and influence the behaviour of employees
  by manipulating its reward system.

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Cont

• It one expects to influence behaviours, he must
  be able to manipulate the consequences. In
  general, it can be concluded that the behavioural
  consequences that are rewarding increase the rate
  of response, while the aversive consequences
  decrease the rate of a response.

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Personality

• Personality may be understood as the
  characteristic patterns of behaviour and modes
  of thinking that determine a persons adjustment
  to the environment
• 
  - E.R. Hilgard and other
• Personality can be described as how a person
  affects others, how he understands and views
  himself and his pattern of inner and outer
  measurable traits
• - Floyd L.Ruch

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Determinants of Personality

• 1. Biological
• a. Heredity
• b. Managerial Thinking
• c. Bio-feedback
• d. Physical Characteristics
• 2. Cultural
• 3. Familial
• 4. Social
• 5. Situational

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People are similar, yet they are different

• Similarities among individual
• 1. Intelligence
• 2. Self-awareness
• 3. Communication
• 4. Innovative skills
• 5. Accumulated gains
• 6. Miscellaneous

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• Difference among Individuals
• 1. People differ in their approach to the job
• 2. The style of supervision differs
• 3. Different types of compensation plans
• 4. Different types of tolerance
• 5. People differ in their work load

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Motivation

• Motivation means a process of stimulating people
  to action to accomplish desired goals W.G.
  Scott.
• Motivation is the process of attempting to
  influence others to do your will through the
  possibility of gain or reward. - Edwin B. Flippo

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Motivation

• The important task before every manager is to
  secure optimum performance from each of his
  subordinates. The performance of the
  subordinate, in turn, is determined by his
  ability to work and the extent to which he is
  motivated. Motivation is the process of inducing
  and instigating the subordinates to put in their
  best. Motivation is influenced significantly by
  the needs of a person and the extent to which
  these have been fulfilled. To motivate the
  subordinates, the manager must, therefore,
  understand their needs.

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Motivation

• The important task before every manager is to
  secure optimum performance from each of his
  subordinates. The performance of the
  subordinate, in turn, is determined by his
  ability to work and the extent to which he is
  motivated. Motivation is the process of inducing
  and instigating the subordinates to put in their
  best. Motivation is influenced significantly by
  the needs of a person and the extent to which
  these have been fulfilled. To motivate the
  subordinates, the manager must, therefore,
  understand their needs.

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Importance of Motivation

• 1. Inducement of employees
• 2. Higher efficiency
• 3. Optimum use of resources
• 4. Avoidance of loss due to mishandling and
  breakage
• 5. No complaints and grievances
• 6. Better human relations
• 7. Avoidance of strikes and lock-outs
• 8. Reduction in labour turnover

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Nature Characteristics of Motivation

• 1. Motivation is a psychological concept
• 2. Motivation is always total and not piece-meal
• 3. Motivation may be financial or non-financial
• 4. Method of Motivation may be positive as well
  as negative
• 5. Motivation is a continuous process

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Motivation Content Theories

1. Abraham Maslows Need Hierarchical Theory
2. Herzbergs Two Factor Theory
3. Douglas McGregors Theory X and Theory Y
4. Alderfers ERG Theory
5. David C. McClellands Three-Need Theory

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Motivation Process Theories

1. Vrooms Expectancy Theory
2. Porter and Lawlers Expectancy Theory
3. Adams Equity Theory

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• Abraham Maslow (1908-1970)

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Maslows Need Hierarchy Theory

• Abraham H. Maslow, a psychologist, developed a
  theory called the Need Hierarchy Theory. It is
  one of the oldest theories on motivation. Maslow
  was of the view that human behaviour is directed
  towards the satisfaction of certain needs.
• He classified all human needs into a hierarchical
  manner from the lower to the higher order. In
  essence, he believed that once a given level of
  need is satisfied, it no longer serves to
  motivate man. Then, the next higher level of
  need has to be activated in order to motivate the
  man.

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Maslows Need Hierarchy Theory
SELF- ACTUALIZATION
ESTEEM NEEDS
LOVE, AFFECTION, AND BELONGINGNESS NEEDS
SAFETY NEEDS
PHYSIOLOGICAL OR SURVIVAL NEEDS
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Maslows Need Hierarchy Theory
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1. Physiological Needs

• These are the primary or the basic needs of a
  person that must be fulfilled. These include,
  among others, food, clothing and shelter that are
  vital for the survival of mankind. A person
  cannot think of recognition or status when he is
  not able to earn adequately to satisfy his basic
  needs.

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2. Safety Needs

• The safety or security needs emerge once the
  basic or physiological needs of a person are
  fulfilled. Job security is one such need.
  People, generally, prefer secured jobs.
  Similarly, every employee wants to contribute to
  provident fund, insurance and such other schemes
  that protect his interest particularly in his old
  age when he cannot work and earn.

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3. Social Needs

• At this stage, a person wants friendship,
  companionship, association, love and affection of
  particularly those with whom he mingles often.
  In the work place he may long for the association
  of the fellow employees. In fact, it is for this
  reason that informal groups are formed within a
  formal organisation. In the living place he may
  desire to have the friendship of his neighbours.

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4. Esteem Needs

• These needs arise in view of a persons desire to
  have his ego satisfied. The satisfaction of
  these needs gives a person the feeling that he is
  above others. It gives a person self-respect,
  self-confidence, independence, status,
  recognition and reputation. Some people show
  preference for luxury cars, expensive jewels and
  so on not just because they can afford it but
  also due to the fact that possession of such
  goods satisfies their ego.

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5. Self-Actualisation needs

• According to Maslow, a person, who reaches this
  stage, wants to achieve all that one is capable
  of achieving. In other words, a person wants to
  perform to his potentials. A professor may, for
  example, author books. A singer may compose
  music and so on. The desire to excel need not
  necessarily be in the filed one is attached to.
  It can be in some other sphere also. For
  example, an actor or actress may excel in
  politics.

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McGregors X and Y Theories

• McGregor developed a philosophical view of
  humankind with his Theory X and Theory Y in 1960.
  He developed two theories on motivation that
  explain the positive and negative qualities of
  individuals. He gave the theories the names X
  theory and Y theory. His work is based upon
  Maslows Hierarchy of needs, where he grouped the
  hierarchy into lower order needs (Theory X) and
  higher order needs (Theory Y).
• He suggested that management could use either set
  of needs to motivate employees, but better
  results would be gained by the use of Theory Y,
  rather than Theory X. These two views theorized
  how people view human behaviour at work and
  organizational life.

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(THEORY X)

• McGregor looked at the way in which employers and
  employees traditionally viewed work The
  employer paid the money and gave instructions,
  and the worker did the job without asking
  questions
• People, in general, dislike work. They shirk
  their duties and are basically lazy.
• Most people are unambitious. They do not
  voluntarily accept any responsibility.
• Most people lack creativity. They show no
  preference for learning anything new.

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(THEORY X)

• 4. Satisfaction of physiological and safety needs
  along is important for most people. Workers in
  general are only bothered about their salary, job
  security and such other extrinsic factors.
• 5. While at work, an employee needs to be closely
  supervised and watched.

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(THEORY Y)

• Theory Y shows a participation style of
  management that is de-centralized. It assumes
  that employees are happy to work, are
  self-motivated and creative, and enjoy working
  with greater responsibility.
• Theory Y workers
• Enjoy their work
• Will work hard to get rewards
• Want to see new things happening
• Will work independently
• Can be trusted to make decisions
• Are motivated by things other than money
• Can work unsupervised

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• Workers attitudes
• Good worker Theory Y
• Lazy worker Theory X
• Skilled Theory Y
• Unskilled Theory X

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Evaluation of X and Y Theories

• The two theories X and Y bring out the two
  extreme qualities of a person. Theory X talks
  about the negative qualities along and theory Y
  talks only about the positive aspects.
• Practically speaking, no person is either too
  good or too bad. Every person has his or her own
  strong and weak points. By providing the right
  kind of environment and with proper motivation
  any individual can be made to perform well.

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Herzbergs Two Factor Theory

• Two factor theory states that there are certain
  factors in the work place that cause job
  satisfaction, while a separate set of factors
  cause dissatisfaction.

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Hygiene Factors

• According to Herzberg, hygiene factors do not
  actually motivate a person but their absence will
  lead to dissatisfaction. These factors are also
  known as extrinsic factors or maintenance
  factors. They help to maintain a reasonable
  level of job satisfaction among the employees.
  These are
• Company policies and Administration
• Type of supervision
• Inter-personal relationships
• Working conditions
• Salary
• Job Security and
• Status

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Motivational Factors

• The motivation factors are also known as
  intrinsic factors. According to Herzberg, the
  presence of the intrinsic factors will motivate
  the employees but their absence will not lead to
  dissatisfaction. These are
• 1. Work itself
• 2. Achievement
• 3. Recognition
• 4. Advancement
• 5. Growth and
• 6. Responsibility

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• Hygiene Factors
• The maintenance factors are known as hygiene
  factors as they influence the mental framework of
  the employees.
• Motivational factors
• Herzberg calls upon managers to use motivational
  factors to induce the employees to perform well.
• Vrooms Expectancy Theory

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Vrooms Expectancy Theory

• Vrooms developed a theory on motivation called
  the expectancy theory. One of the most widely
  accepted explanations of motivation is offered by
  Victor Vroom in his Expectancy Theory. It is a
  cognitive process theory of motivation. The
  theory is founded on the basic notions that
  people will be motivated to exert a high level of
  effort when they believe there are relationships
  between the effort they put forth, the
  performance they achieve, and the
  outcomes/rewards they receive.

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Vrooms Expectancy Theory
Effort
Reward
Performance
Will my effort improve my performance?
Will performance lead to rewards?
Will rewards satisfy my individual goals?
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Vrooms Expectancy Theory

• He tried to explain motivation through the
  following concepts
• 1. Valence
• 2. Expectancy and
• 3. Instrumentality
• According to Vrooms theory, motivation is the
  sum of the product of valence, expectancy and
  instrumentality. That is,
• Motivation Valence x Expectancy x
  Instrumentality

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Vrooms Expectancy Theory

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Vrooms Expectancy Theory

1. Valence Valence, according to Vroom, means
   the value or strength one places on a particular
   outcome or reward.
2. Expectancy It relates efforts to
   performance
3. Instrumentality By instrumentality, Vroom
   means, the belief that performance is related to
   rewards.

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VALUES

• A value is commonly formed by a particular
  belief that is related to the worth of an idea or
  type of behaviour. Values are one of the sources
  of individual differences. Values are general
  beliefs tinged with moral flavour containing an
  individuals judgemental ideas about what is
  good, right or desirable.
• Value is a concept of the desirable, an
  internalised criterion or standard of evaluation
  a person possesses. Such concepts and standards
  are relatively few and determine or guide an
  individuals evaluations of many objects
  encountered in everyday life.

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ATTITUDES

• The word attitude can refer to a lasting group
  of feelings, beliefs and behaviour tendencies
  directed towards specific people, groups, ideas
  or objects.
• Attitudes are the expression of our values. They
  are expressed through what we say or do, while
  values make us agree to certain things and
  discard others. How we act and what we say brings
  out our attitudes.

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Beliefs

• The mental act, condition, or habit of placing
  trust or confidence in another My belief in you
  is as strong as ever.
• Mental acceptance of and conviction in the truth,
  actuality, or validity of something His
  explanation of what happened defies belief.
• Something believed or accepted as true,
  especially a particular tenet or a body of tenets
  accepted by a group of persons.

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Conflicts

• Conflict means disagreement between the persons
  employed in an organisation. It may also mean
  clash of interests. It is the result of
  differences in the opinion of employees of an
  organisation over any issue.

Conflict is any situation in which two or more
parties feel themselves in opposition. It is an
interpersonal process that arises from
disagreement over the goals or the methods to
accomplish those goals
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Why do Conflicts Arise?

1. Changes in work patterns
2. Differences in perceptions
3. Differences in values
4. Availability of options
5. Allocation of limited resources
6. Inter-dependence
7. Unequal work-load
8. Biased assessment of subordinates
9. Unattainable targets
10. Lack of trust and confidence

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Stress

• Stress is defined in terms of its physical and
  physiological effects on a person, and can be a
  mental, physical, or emotional strain.

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Managing Stress
Stress Relief Strategies 1. Body relaxation
excercises - breathing techniques - guided
imagery 2. Physical exercise -yoga -work out
routine 3. Meditation 4. Counseling -talk
therapy -life coaching
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Sources of stress

• Environmental factors
• Organizational factors
• Individual factors

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1. Environmental factors

• Environmental uncertainties
• Changes in business cycles
• Political uncertainties
• Technical uncertainties

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2. Organizational factors

• Pressure to avoid errors or complete task in
  limited time period
• Task demands are factors related to a persons job
• Role of individuals to play in an organization

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3. Individual factors

• Employees personal life like family issues,
  economic problems and personality characteristics
• Broken families, wrecked marriages and other
  family issues
• Economic problems created by individuals
• A persons basic dispositional nature
• Stressors are additive stress builds up

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Behaviorally at Work with Stress

• Absenteeism
• Accidents
• Poor morale
• Impaired cognitive functioning
• Poor decision making
• Lower creativity
• Burnout
• Workplace violence
• Poor job performance

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UNIT - 3

• Group Behaviour

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Group

• A group is a collection of two or more
  individuals, interacting and interdependent, who
  have come together to achieve particular common
  objectives. A group is, thus, an aggregation of
  people who interact with each other, are aware of
  one another, have a common objective, and
  perceive themselves to be a group.
• Now a group may be defined as a collection of
  people who have a common purpose or objective,
  interact with each other to accomplish the group
  objectives.

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Classification of Group

• 1. Psychological Group
• It may be defined as one in which the two or
  more persons who are interdependent as each
  members nature influences every other person,
  members share an ideology and have common tasks.
  (e.g., Families, Friendship circles)
• 2. Social Group
• It may be defined as integrated system of inter
  related psychological groups formed to accomplish
  a defined function or objective. (Political party)

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Classification of Group

• 3. Formal Group
• It refers to those which are established under
  the legal or formal authority with the view to
  achieve a particular end result (e.g. people
  making up the airline fight crew)
• 4. Informal Group
• It refers to the aggregate of the proposal
  contracts and the interaction and the network of
  relationships among the individuals obtained in
  the formal groups.

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Classification of Group

• 5. Primary Group
• The primary groups are characterized by small
  size, face to face interactions and intimacy
  among the members. The examples are family
  groups.
• 6. Secondary Group
• The secondary group are characterized by large
  size and individuals identification with the
  values and beliefs prevailing in them rather than
  actual interactions . ( e.g., occupational
  association and ethnic groups)

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Classification of Group

• 7. Membership Group
• The membership group is those where the
  individual actually belongs.
• 8. Reference Group
• The reference is one which they would like to
  belong.

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Classification of Group

• 9. Command Group
• The command group are formed by subordinates
  reporting directly to the particular manager and
  are determined by the formal organizational
  chart. (e.g., an assistant regional transport
  officer and his two transport supervisors form a
  command group .
• 10. Task Group
• The task group are composed of people who work
  together to perform a task but involve a cross
  command relationship.

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Classification of Group

• 11. Interest Group
• The interest group involves people who come
  together to accomplish a particular goal with
  which they are concerned. (e.g., office
  employees)
• 12. Friendship Group
• The friendship group are formed by people having
  one or more common features.

137
Reasons for Formation of Groups

• 1. Companionship
• 2. Sense of identification
• 3. Source of Information
• 4. Job satisfaction
• 5. Protection of members
• 6. Outlet for frustration

138
Importance of Small Groups to the Organisation

• 1. Filling in gaps in managers abilities
• 2. Better coordination
• 3. Channel communication
• 4. Restrain managers
• 5. Better relations
• 6. Norms of behavior

139
Group Decision-Making

• Decision-making is the process whereby a final
  but best choice is made among the alternatives
  available. When a groups makes decision, it can
  be either through the consensus mode or through
  majority vote. When all members of the group
  agree to the decision arrived at, it is called
  consensus. If majority of the group members
  agree to the decision arrived at, it is called
  majority vote.

140
Group Decision-Making Process
1
2
3
4
Implementation Monitoring the Decision
Diagnose the Problem
Evaluating the Alternative
Developing Alternatives
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Advantages of Group Decision-Making

1. Compared to an individual, the groups usually
   have a greater knowledge, expertise, and skill
   base to make better decisions.
2. Larger number of members provide more
   perspectives of the problem. As such, the narrow
   vision of a single perspective is avoided in
   making decisions.
3. With larger number of group members, the
   participation also increases that help reach at a
   quality decision.
4. Following increased group participation,
   comprehension of final decision arrived at is
   usually high.

142
Disadvantages of Group Decision-Making

1. Group decision-making is a time consuming
   process.
2. Influence groups usually manipulate the group
   decision in a direction of their liking and
   interest.
3. Sometimes decisions made by the group members are
   simply a compromise between the various views and
   options offered by the group members.

143
How to improve Group Decision-Making?

• 1. Brainstorming (alex osborn 1938)(6-8people)
• 2. Nominal Group Technique (NGT)
• 3. Delphi Technique
• 4. Consensus Mapping

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TEAM

• A collection of individuals in one place may be
  only a crowd. A group of individuals working in
  a face-to-face relationship for a common goal,
  having collective accountability for the outcome
  of its efforts is called team.
• A team is a group whose members have
  complementary skills and are committed to a
  common purpose or set of performance goals for
  which they hold themselves mutually accountable.

145
Team Building Process
Problem Sensing
Examining Perceptual Differences
Follow Up Actions
Giving Receiving Feedback
Developing Interactive Skills
146
Team Building Process

• 1. Problem Sensing and Identification
• 2. Examination of Differences
• 3. Feedback
• 4. Developing Argumentative skills
• 5. Constructive Behaviour
• 6. Negative Behaviour
• 7. Follow-up Action

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Leadership

• Leadership is the activity of influencing people
  to strive willingly for group objectives -
  George K. Terry
• Leadership is the ability of a superior to
  influence the behaviour of his subordinates and
  persuade them to follow a particular course of
  action - Chester Barnard
• Leadership is the quality of behaviour of
  individuals whereby they guide people or their
  activities in organising efforts
  - Chester Barnard

148
Leadership

• Formal Leadership occurs when an organisation
  officially bestows upon a leader the power and
  authority to guide and direct others in the
  organisations.
• Informal Leadership occurs when others in the
  organisation unofficially accord a person the
  power and influence to guide and direct their
  behaviour.

149
Leadership Management
Leadership
Management
1. Leader leads people. 2. Leader can use his/her
informal influence. 3. Leaders create a vision
and inspire others to achieve this vision. 4.
Leader possesses non-sanctioned influencing
ability. 5. Leader inspires enthusiasm.
1. Manager manages things. 2. Managers hold
formal positions. 3. Manager achieve results by
direction the activities of others. 4. Manager
enjoys formal designated authority. 5. Manager
engenders fear.
150
Nature Characteristics of Leadership

• 1. It is the personal quality of a person
• 2. It is a process of influencing others
• 3. It requires the confidence of
  followers/subordinates
• 4. It requires motivation of subordinates
• 5. Varying leadership styles
• 6. Leadership is a continuous process

151
Qualities of Leader

• 1. Ability to analyze
• 2. Self-confidence
• 3. Foresight
• 4. Sense of judgement
• 5. Understanding
• 6. Mental courage

7. Capacity to motivate 8. Ability to guide 9.
Communication skills 10. Sound physical
health 11. Positive thinking
152
Kinds of Leadership Styles

1. Autocratic or Authoritative Style
2. Democratic or participative Style
3. Laissez-Faire or Free-Rein Style

153
1. Autocratic or Authoritative Style

• In autocratic style, the leader centralises power
  and decision-making in himself / herself. The
  leader commands complete control over the
  subordinates who are compelled to obey the
  orders. The subordinates have no opportunity to
  make suggestions or take part in decision-making
  function. The autocratic leader has little
  concern for the well-being of employees. In
  turn, employees have a tendency to avoid
  responsibility and try to work as little as
  possible. They also suffer from frustration and
  low morale.

154
2. Democratic or Participative Style

• In democratic style of leadership, the leader
  takes decision in consultation with the
  subordinates. In other words, the subordinates
  participate in decision-making function. Hence,
  the style is also known as participative style.
  Participation in decision-making enables
  subordinates to satisfy their social and ego
  needs. It also makes them more committed to
  their organisations. Frequent interaction
  between the manager-leader and subordinates also
  helps build up mutual faith and confidence.

155
3. Laissez Faire Style

• Laissez faire style is just the opposite of
  autocratic style. In laissez faire style, the
  manager-leader leaves decision-making to the
  subordinates. The leader completely gives up
  his/her leadership role. The subordinates enjoy
  full freedom to decide as and what they like.
  The biggest limitation of this style is that, due
  to full freedom to subordinates, it creates chaos
  and mismanagement in decision-making.

156
Power
B
A
157
Power

• Power is the capacity of a person, team or
  organization to influence others. Power is not
  the act of changing others attitudes or
  behaviour its only the potential to do so. The
  most basic prerequisites of power is that one
  party believes he or she is dependent on the
  other for something of value.

158
Distinction Between Power, Authority Influence

• Power is the ability to get an individual or
  group to do something to get the person or
  group to change in some way. The person who
  possesses power has ability to manipulate or
  change others.
• Authority is the right to manipulate or change
  others. Power need not to be lawful.
• Influence It involves ability to alter other
  people in general ways, such as by changing their
  satisfaction and performance. Influence is more
  closely associated with leadership than power is,
  but both obviously are involved in the leadership
  process.

159
Bases or Sources of Power

1. Reward Power It refers to the leaders ability
   to control the payment of salaries, wages,
   commission, fringe benefits etc. It is based on
   the belief that wealth is power.
2. Coercive Power It is the capacity of the leader
   to award punishment to subordinates in the form
   of suspension, transfer, demotion and so on.

160
Bases or Sources of Power

1. Legitimate Power It is available to a person by
   reason of his position. It may be formal or
   informal. Legitimate power is formal in an
   organisation where the superior delegates his
   authority to the subordinates.
2. Referent Power It refers to certain unique
   qualities of a leader that induce his followers
   to emulate him. In our society many film
   personalities and sportsmen are able to influence
   their fans. The latter take the former as their
   role models.

161
Bases or Sources of Power

1. Expert Power It accrues to the individual by
   virtue of his knowledge and skill. It is based
   on the belief that knowledge is power. Such a
   power arises owing to the fact that the expert is
   indispensable for the organisation.

162
Politics

• When a person having power or authority uses
  the same to favour some in the organisation, much
  against the interests of others, there is
  Politics.
• A manager, for example, by reason of his
  authority, may give promotion to an employee,
  owing to personal reasons, and the same may be
  detrimental to the interests of another deserving
  employee. It is an instance like this that is
  referred to as organisational politics.

163
Reasons for Organisational Politics

• 1. Unclear Goals
• 2. Autocratic Decisions
• 3. Discretionary Authority
• 4. Power Politics
• 5. Biased Performance Appraisal
• 6. Saturation in Promotion

164
UNIT 4
Organizational Dimensions
THE CAIN PROJECT
165
Organisational Structure
Organisational structure indicates the
organisations hierarchy and authority structure,
and shows its reporting relationships. It
provides the stability and continuity that allow
the organisation to survive the comings and
goings of individual and co-ordinate its dealings
with the environment.
THE CAIN PROJECT
166
Why Organisational Structure?
1. It facilitates management 2. It encourages
growth and diversification 3. It facilitates the
optimum use of technological improvement 4. It
encourages proper use of human resources 5. It
stimulates creativity
THE CAIN PROJECT
167
DEPARTMENTATION / FUNCTIONAL DEPARTMENTATION

• Departmentation means the process of grouping of
  similar activities of the business into
  department, division or other homogeneous units.
  It is used for the purpose of facilitating smooth
  administration at all levels.
• Departmentation involves grouping of people or
  activities with similar characteristics into a
  single department or unit.

THE CAIN PROJECT
168
DEPARTMENTATION BY DIFFERENT STRATEGIES
1. Departmentation by Numbers 2.
Departmentation by Time 3. Departmentation by
Enterprise Function 4. Departmentation by
Territory or Geography 5. Departmentation by
Customers 6. Departmentation by Process or
Equipment
THE CAIN PROJECT
169
1. Departmentation by Numbers

• In this case, departments are created on the
  basis of number of persons forming the
  department. Similar types of activities are
  performed by small groups.
• In such case, the each group is controlled by a
  supervisor or an executive.

THE CAIN PROJECT
170
2. Departmentation by Time

• Under this base, the business activities are
  grouped together on the basis of the time of
  performance.
• For example, a manufacturing unit working in
  three shifts of eight hours each per day may
  group the activities shift wise and thus having
  separate department for each shift.
• The basic idea is to get the advantages of people
  specialized to work in a particular shift.

171
3. Departmentation by Enterprise Function
Pr