Organization

behavior
AS AN ENTREPRENEUR
AYUSH BISHT

1 Intr
odu
ctio
n to

organizational Behavior
Organizational Behavior is a field of study that investigates the impact
that individuals, groups and structure have on behavior within
organizations, for the purpose of applying such knowledge toward
improving an organizations effectiveness.

Organizational behavior is the study of the many factors that have an impact on
how individuals [1] and groups [2] respond to and act in organizations and how
organizations [3] manage their environments. The study of organizational
behavior provides a set of toolsconcepts and theoriesthat help people

understand, analyze, and describe what goes on in organizations and why. How do
the characteristics of individuals, groups, work situations, and the organization itself
affect how members feel about their organization?

The ability to use the tools of organizational behavior to understand behavior in

organizations is one reason for studying this subject. A second reason is to learn
how to apply these concepts, theories, and techniques to improve behavior in
organizations so that individuals, groups, and organizations can achieve their goals.
Managers are challenged to find new ways to motivate and coordinate employees to
ensure that their goals are aligned with organizational goals.

Organizational Behavior addresses following points:

Organizational behavior studies the factors that impact individual and group
behavior in organizations and how organizations manage their environments.
Organizational behavior provides a set of toolstheories and conceptsto
understand, analyze, describe, and manage attitudes and behavior in organizations.

The study of organizational behavior can improve and change individual, group, and
organizational behavior to attain individual, group, and organizational goals.

Organizational behavior can be analyzed at three levels: the individual, the group,
and the organization as a whole. A full understanding must include an examination
of behavioral factors at each level.
A managers job is to use the tools of organizational behavior to increase
effectiveness, an organizations ability to achieve its goal. Management is the
process of planning, organizing, leading, and controlling an organizations human,
financial, material, and other resources to increase its effectiveness.

Part 1: The individual level

2.1 ABILITY & LEARNING

Ability refers to an individuals capacity to perform the various tasks in a job. It is a
current assessment of what one can do. A high ability-job fit necessary for improved
job performance Lack of fit leads to performance problems.

As a manager I need to ensure there is optimal Ability-job fit.

If, Ability < Job Requirements

Basic cause of poor performance

Ability > Job Requirements

Organizational inefficiency and job dissatisfaction

2.2 VALUES, ATTITUDES

AND JOB

SATISFACTION

As a manager I need to understand the importance of values:

Provide understanding of the attitudes, motivation, and behaviors of
individuals.
Influence perception of the world around us.
Represent our assumptions of right and wrong.
Some behaviors or outcomes are preferred over others.

As an entrepreneur I need to be informed of the values of my employees,

as these value are important in the efficiency of the business. Ethical
values and behaviors of leaders help in an ethical climate in the
organization
Research shows most people that are 60+ have values like hard working,
conservative, loyalty to organization, etc. However, people with age under 25
years have different work values like confidence, financial success, self-reliance
but team oriented.

Attitudes of individuals are the evaluative statements or judgments

concerning objects, people, or events.
Organizational Commitment is the extent to which an individual identifies
with a particular organization and its goals, and wishing to maintain
membership in the organization.
Job Involvement is the extent to which an individual identifies with the job,
actively participating in it, and considering performance important to selfworth.
Job Satisfaction is the collection of positive and/or negative feelings that an
individual holds toward his or her job.

All of these factors are of utmost importance as:

Productivity is higher in organizations with more satisfied workers.

Job satisfaction and involvement result in fewer avoidable absences.
Employees are less likely to quit.
Employees increase customer satisfaction as they are more friendly,
upbeat and responsive.

Satisfied employees who feel fairly treated by and are trusting of the
organization are more willing to engage in behaviors that go beyond the
normal expectations of their job.

2.3 PERSONALITY & EMOTIONS

As an entrepreneur, I need to understand the various personality traits
and emotions that individuals exhibit. These traits are important in an
organization as it helps us predict behavior. Personality and emotions can
help match people to jobs, to some extent at least.

Emotions tend to hinder performance, especially when emotions are

negative. However if used properly, they can also enhance performance.
Women show greater emotional expression than men. They experience and
display emotions more intensely. Therefore they are often favored of some
job positions and work responsibilities.
Negative emotions can lead to negative workplace behaviors, like leaving
early, working slowly, gossiping, stealing, etc.
Various methods can be used by me to infer the personality traits of
individuals such the Big 5 model or the Myers-Briggs Type indicator,
etc.

2.4 PERCEPTION & INDIVIDUAL DECISION MAKING

As an entrepreneur, an individuals perception is important to the
organization because behavior is based on perception of what reality is,
not on reality itself. People will believe what they perceive to be true.
The world as it is perceived is the world that is behaviorally important.

Needed to better understand how people make attributions about events.

We dont see reality. We interpret what we see and call it reality
The attribution process guides our behavior, regardless of the truth of the
attribution.

Perception shapes individual decision making and will help in predicting the ways in
which an individual reacts and interacts with others.
Personality tests will help me in hiring individuals. And the scores on
personality tests will help me forecast who is best fit for the job.

2.5 BASIC MOTIVATION CONCEPTS

Motivation gives the required intensity, direction and persistence towards
attainment of goals.
Some of the motivation techniques I would use as an entrepreneur are:

Hierarchy of Needs Theory (Maslow) Hierarchy of Needs Theory There is a

hierarchy of five needs physiological, safety, social, esteem, and selfactualization; as each need is substantially satisfied, the next need becomes
dominant.

Theory X and Theory Y (Douglas McGregor) Theory X Assumes that

employees dislike work, lack ambition, avoid responsibility, and must be
directed and coerced to perform. Theory Y Assumes that employees like work,
seek responsibility, are capable of making decisions, and exercise selfdirection and self-control when committed to a goal.

Two-Factor Theory (Frederick Herzberg) Two-Factor (Motivation-Hygiene)

Intrinsic factors are related to job satisfaction, while extrinsic factors are
associated with dissatisfaction. Hygiene Factors such as company policy
and administration, supervision, and salarythat, when adequate in a job,
placate workers. When factors are adequate, people will not be dissatisfied.

ERG Theory (Clayton Alderfer) Existence: provision of basic material

requirements. Relatedness: desire for relationships. Growth: desire for
personal development. More than one need can be operative at the same
time. If a higher-level need cannot be fulfilled, the desire to satisfy a lowerlevel need increases.

David McClellands Theory of Needs Need for Achievement The drive to

excel, to achieve in relation to a set of standards, to strive to succeed. Need
for Affiliation. The desire for friendly and close personal relationships. Need
for Power. The need to make others behave in a way that they would not
have behaved otherwise. nAch nPow nAf

Cognitive Evaluation Theory: Providing an extrinsic reward for behavior

that had been previously only intrinsically rewarding tends to decrease the
overall level of motivation. The theory may only be relevant to jobs that
are neither extremely dull nor extremely interesting.

Goal-Setting Theory (Edwin Locke) The theory that specific and difficult
goals, with feedback, lead to higher performance. Factors influencing the
goalsperformance relationship: Goal commitment, adequate selfefficacy, task characteristics, and national culture. Self-Efficacy: The
individuals belief that he or she is capable of performing a task.

Reinforcement Theory Behavior is environmentally caused. Behavior can

be modified (reinforced) by providing (controlling) consequences. Reinforced
behavior tends to be repeated. The assumption is that behavior is a function
of its consequences.

Equity Theory Referent Comparisons: Self-inside Self-outside Other-inside

Other-outside
Individuals compare their job inputs and outcomes with those of others and
then respond to eliminate any inequities.

Expectancy Theory (Victor Vroom) the strength of a tendency to act in a

certain way depends on the strength of an expectation that the act will be
followed by a given outcome and on the attractiveness of that outcome to the
individual.
EfortPerformance Relationship
The probability that exerting a given amount of effort will lead to
performance.
PerformanceReward Relationship
The belief that performing at a particular level will lead to the attainment
of a desired outcome.
RewardsPersonal Goals Relationship
The degree to which organizational rewards satisfy an individuals goals or
needs and the attractiveness of potential rewards for the individual.

Apart from these, as an entrepreneur, it will be my duty to adapt to

changes that are required.

For example, implementation of job rotation, job enlargement and

job enrichment.
Allow job sharing, having 2 or more people split a 40-hour-a-week
job.
Flexitime, employees work during a common core time period each
day but have discretion in
Forming their total workday from a flexible set of hours outside the
core
Telecommuting, Employees do their work at home on a computer
that is linked to their office.
Variable Pay Programs, a portion of an employees pay is based on
some individual and/or organization measure of performance.

 And many more.

3 Part 2: The group level

As a manager it is my responsibility to facilitate workflow in the
organization and through the most efficient procedures. Groups will help
make better decisions, increase commitment to decisions, promote
creativity, implement control, and be very useful in large organizations.
As I am in charge of more than 50 employees, I will come across 2 major
types of groups:
Formal Group

A designated work group defined by the organizations structure.

Informal Group

A group that is neither formally structured nor organizationally determined;

appears in response to the need for social contact.

Command Group

A group composed of the individuals who report directly to a given manager

Task Group

Those working together to complete a job or task

Interest Group

Those working together to attain a specific objective with which each is

concerned

Friendship Group

Those brought together because they share one or more common

characteristics

These groups will provide many benefits to the individuals. Some benefits
are security, status, self-esteem, affiliation, power and, goal achievement.

As we proceed further in groups, we find a set of expected behavior

patterns attributed to someone occupying a given position in a social unit,
these shape into attitudes and behaviors consistent with a role, and we
tend to perceive how an individual is supposed to act in a given situation.
We get this perception from stimuli all around us. And we judge from this
perception and expect how a person should act in a given situation. These
expectations, when not fulfilled, lead to role conflicts.
It will be my effort to increase cohesiveness and decrease social loafing in
the groups, and use group thinking techniques to be useful towards
common goals, like brainstorming and electronic meeting.

3.1 COMMUNICATION

Exchanging routine information and processing paperwork

As manager, I need to find appropriate communication channels

I need to adapt with the organizational needs as well as the

technological needs.

A good communication channel will increase responsiveness to

customers, empower employees, lower response time to satisfy
customer wants and needs

More innovation through communication. Cross-functional teams

communicating effectively produce higher quality products.

I will be using a network of internet and intranet communication.

3.2 LEADERSHIP

Emotions are important to acceptance of messages from organizational

leaders.

Includes motivating employees, directing others, selecting the most

effective communication channels, and resolving conflicts.

Need people with self-motivation traits

Inspiring and guiding individuals and groups.

As a leader my influence will turn on their own qualities of character,

expertise, prestige, intelligence, charm and credibility, but these will
have little impact unless they engage the relevant needs and
motivations of the persons being influenced.

3.3 POWER &

POLITICS
Avoid gossiping, blaming on other people in the organization

Pre-decided Reporting relationship. Clearly defined authority and

responsibility

Will be very diligent against unequal power distribution in the

workplace for higher positions

Even in this era of globalization, there exists a mental block among the
male, which dont accepts a female as their as their boss. This
behavior will not be accepted in the organization

Also, there will be no type of sexual harassment or requests for sexual

favors

3.4 LEVELS

OF CONFLICT
As the manager, it will be my duty to reduce and remove any conflicts
that may arise. There are many sources of conflicts. Such as
incompatible goals, scarce resources, poor communication or even
differentiation.
Conflicts if not tackled properly may give rise to stress, turnover, and
politics in the organization and even lower performance. But if properly
tackled, they result in better decisions, a responsive organization and a
cohesive team.
Five category model of conflicts, that will help my employees the
outcome-conflict relationship. They can better judge what best option
is.
Problem Solving
[Win-Win outcome]
Forcing
[Win Lose]
Avoiding
[avoiding conflict to attempt to
smooth it over]
Yielding
[Giving in Completely]
Compromising
[Losses offset by equally valuable
gains]

How can OB help me in my

business

As an entrepreneur employing more than fifty employees, I need to apply the study
of organizational behavior in order to improve the overall effectiveness and
efficiency of the organization
Organizational behavior will provide solutions as well as insight towards solution to
many challenges which may be faced by my organization. Some of the important
roles that I will perform by organizational behavior in management of business are
as follows:-

4.1 GLOBALIZATION
Due to globalization, organizations are no longer confined to one particular country.
The Managers job is changing with the expansion of the organizations across the
national borders. Example, Volkswagen builds its cars in Mexico, Mercedes and BMW
in South Africa. Due to globalization, the management has to deal with the problems
of unfamiliar languages, laws, work ethics, management styles etc. The functions of
hiring, training, etc. must acquire a global perspective. Organizational Behavior
will help the management to become flexible, and proactive and enables it
to execute the organization on a global scale.

4.2 MANAGING

WORK FORCE DIVERSITY

Organizations are a heterogeneous mix of people in terms of age, gender, race etc.
Managing the workforce diversity has become a global concern. Managers have to
deal with individuals and groups belonging to different ethnic cultures. They have to
exercise control and channelize behavior in the desired direction. Organizational
behavior will help the managers to efectively deal with work force
diversity by promoting its awareness, increasing diversity skills,
encouraging culture and gender diversity.

4.3 IMPROVING QUALITY

AND PRODUCTIVITY
Industries are facing the problem of excess supply. This has increased competition
to a large extent. Almost every
Manager is confronting the same problem of improving the productivity, quality of
the goods and services their organization is providing. Programmes such as
business process reengineering, and total Quality Management are being
implemented to achieve these ends. Organizational Behavior will help the
managers to empower their employees, as they are the major forces for
implementing this change.

4.4 IMPROVING

CUSTOMER SERVICE
Most of the employees work in service sector. The jobs in the service sector, is very
demanding. It requires continuous interaction with the organizations clients i.e. the
customers. Management has to ensure that the employees do everything to satisfy
the customers of the organization. The attitude and behavior of an employee affects
the customer satisfaction. Organizational Behavior will help the managers to
improve customer service and organizational performance.

4.5 IMPROVING

PEOPLE SKILLS
Organizational Behavior will help in better management of business as it
helps in improving the skills of the people. It provides insight into the skills
that the employees can use on the job such as designing jobs and creating effective
teams.

4.6 INNOVATION

AND CHANGE
Organizational Behavior will help in stimulating innovation and change.
Employees can either be a hurdle or an instrument of change. It is organizational
behavior which fosters ideas and techniques to promote innovation and change by
improving employees creativity.

4.7 WORK

LIFE BALANCE
Organizations that do not help employees to achieve work life balance will not be
able to retain their most talented employees. Organizational behavior will helps
in designing flexible jobs which can help employees deal with work life
balance issues.

4.8 PROMOTING

ETHICAL BEHAVIOR
Sometimes the organizations are in a situation of ethical dilemma where they have
to define right and wrong. It is Organizational Behavior which will help the
management to create such a work environment which is ethically healthy
and increases work productivity, job satisfaction and organizational
citizenship behavior.

4.9 CREATING

A POSITIVE WORK ENVIRONMENT

Organizational behavior will help in creating a positive work environment
in todays where competitive pressures are stronger than before. OB will
help to develop resilience, human strength, and it fosters vitality.