ORGANIZATIONAL

BEHAVIOR

BY PROF SHIBANI SHUVASMITA

DEPT OF MBA
GANDHI INSTITUTE FOR
TECHNOLOGY, BBSR
 INTRODUCTION TO
ORGANIZATIONAL BEHAVIOR
• ORGANISATION:
• An organization is a group of people working together to meet the collective
organizational goals. The main objective is profit maximization.
• FEATURES OF AN ORGANIZATION:-
•  Group Of People
•  Formally Organized People/Structure
•  Co-ordination Among People
•  Rationality
•  Purposefully Created To Achieve A Common Goal

BEHAVIOR:

• It Is How A Person Behaves. It Is An Observable And Measurable Activity Of

Human Beings.
 CONCEPT OF ORGANIZATIONAL BEHAVIOR

OB 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 towards improving an organization’s
effectiveness.
OB is directly involved with the understanding , prediction, and
management of human behavior in organizations.
• HENCE BASED ON THE DEFINITION WE CAN SAY
THAT
• OB is a field of study
• It studies individuals, groups, and structures
• It applies the knowledge to improve organizational effectiveness.
• Therefore Organization Behavior Is Concerned With Two
Aspects:-
• How do people behave in an organization?
• How does their behavior affect their performance?
 NATURE OF OB
1. Separate Field of study not a Discipline
2. An Interdisciplinary approach: Draws knowledge from psychology, sociology
and anthropology
3. Applied Science : Applies various researches to solve the organizational
problem related to human behaviour.
4. Normative Science: While the positive science discusses only cause effect
relationship, OB deals with what is accepted by individuals and society
engaged in an organisation.
5. Humanistic and Optimistic approach: Deals with the thinking and feeling of
human beings.
6. A total system approach: Integrates all the variables , affecting organisational
functioning
 SCOPE OF ORGANIZATIONAL
BEHAVIOR
• 1. Organizational Structure
• 2. Group Dynamics
3. Individual Behavior
 1. ORGANIZATIONAL STRUCTURE
• Hierarchy and authority

• Role clarity and responsibilities

• Types of organizational structures

• Workflow and coordination

• Adaptability and change management

 2. GROUP DYNAMICS

• Communication Patterns

• Leadership Roles

• Conflict Resolution

• Group Decision-making
 3.INDIVIDUAL BEHAVIOR

1. Personality(it is a str that combines a person’s

behavior, thoughts, and emotions)

2. Attitude ( The way a person think)

3. Perceptions ( the ability to notice or understand

something)

4. Motivation

5. Learning
 WHAT MANAGERS DO?
• A manager is an individual who is responsible for overseeing and
coordinating the activities of a group of people within an organization.
Their primary role is to ensure that the team or department they manage
meets its goals efficiently and effectively. Managers are typically tasked
with planning, organizing, leading, and controlling various resources—
such as people, time, and materials—to achieve the organization’s
objectives.
 MANAGEMENT FUNCTIONS
Planning
 It is the 1st function. It is base of all other functions.
 Deciding in advance What to do, How to do , When to do & Who is going to do.
 It bridges the gap between where we stand today where we want to reach.

Organising
 To organize the activities and establishing an organization structure to execute the
plan
 Deciding the framework of working how many units and subunits of departments are
needed , how many posts or designations are needed in each department.
 How to distribute the authority and responsibility among different people.
• STAFFING
 It is the 3rd step or functions of a manager .
 It refers to recruiting , Selecting, appointing the employees , assigning
them duties and maintaining cordial relations and taking care of
grievances of employees.
 Training and Developing the employees.
 Deciding Remuneration, promotion
 Maintaining personal Rewards of employees.
• Directing
 Giving directions or instructions to employees and get work done by
motivating them supervising the activities of employees,
communicating with them.
 It Includes supervising , motivating , communicating and leadership

Controlling
 It is last functions of managers .
 Managers try to match Actual performance with the planned
performance .
 If there is no match between both them managers try to find out the
reasons of deviations and suggest corrective measures
LEVELS OF MANAGEMENT
ELEMENTS OF OB
EMPLOYEE OR PEOPLE

• The existence of an organization is impossible without people. People

make up the internal social system of the organization.
• People consist of individuals and groups.
• Groups may be formal or informal, small or large interrelated and
complex.
• People are dynamic in nature as they interact with each other and also
influence each other.
• Groups may form, change, and dissolve.
• Organizations are established to serve the people.
 STRUCTURE
• In this world ,everything has a structure for example, the human body,
tree, house , and even your class.
• In an organization, structure defines the roles and responsibilities of
people . It leads to a division of work
• Some may be executives; others may be supervisors, assistants ,
persons, and workers.
• The structure clarifies the authority responsibilities relationships.
• All of these people are related to each other to accomplish the
objectives in a coordinated manner.
 TECHNOLOGY
• In today’s world without technology work would be either difficult or
even impossible.
• It provides economic and physical resources to make people’s jobs
easy.
• The people are given the assistance of machines, tools, methods and
resources.
• Technology may also put restrictions on the freedom of people
 SOCIAL SYSTEM

• Everything around us is society and everyone in the social lives

together.
• The social system determines the organizational work environment and
from which the organization can operate.
• As people cannot live alone just like organization can not run alone its
job.
• The organization has to do its activity with the help of the employee.
 EXTERNAL ENVIRONMENT

• The external environment is an important elements of OB.

• An organisation operates in a larger social system and is influenced by
the external environment which includes socio cultural , economic ,
political , legal, technological, and geological forces.
• These forces influence people’s attitudes, motives, and working
conditions in an organization in many ways.
• Similarly , the organization also has also an influence over the
environment but the degree of influence is less.
MODELS OF OB
 1. AUTOCRATIC MODEL
 Started in the period of industrial revolution
 It gives the owners and manager’s power to dictate and form decisions while
making employees obey their orders.
 Manager will do all the thinking work and employees will execute
 Command comes from top to bottom in the form of “ you do this or else….”
 Power lies in the hand of employers to hire and fire
 Employees receive less wages as they are less skilled and their performance is
also minimum, which they do it rather reluctantly as they have to satisfy the
needs of their families and themselves.
 2. CUSTODIAL MODEL
• In the autocratic setup employees does not talk back yet they have many things
to say but incapability to speak result in frustrations, insecurity, and aggressive
behavior towards their boss.
• In this model, managers began to think about the security of the security of the
employees ( social as well as economic).
• Now managers begun to study about their employees needs.
• Employers started to develop better relations with the employees and to keep
them satisfied and motivated.
• A successful custodial approach depends on providing economic security which
many companies are now offering as high pay scale , remunerations in the form
of health benefits, corporate cars, financial packaging and many other forms of
incentives.
 3. Supportive model
• Unlike the two previous approaches, the supportive model emphasis on
motivated and aspiring leader.
• There is no space for any control or authoritative power in this model or on the
incentives or reward schemes.
• It is simply based on motivating staff through the establishment of the manager
and employee relationship and the treatment that is given to employees on daily
basis.
• Create a positive work place to keep the employees self motivated.
• A classic example is Howthorne experiment which concluded that organization is
a social system where workers are important element of the system.
• Group dynamics and supportive supervision give better results.
 4. COLLEGIAL MODEL
• In this scheme, the structure of an organization is developed in a way that there
is no boss nor subordinates, but all are colleagues who have to work as a team.
• No one is worried about his status or a job title.
• Manager’s role is here like a coach whose function is to guide the team to
perform and generate positive and motivating work environment, instead of
focusing on his own personal growth.
• Collegial models seems to be an extension of the supportive model.
• The success of the collegial model depends on the management’s ability to
foster the feeling of partnership between the employees.
• The manager is oriented towards the team performance while each employee is
responsible for his task and towards each other.
 5. SYSTEM MODEL
• One of the most emerging model.
• Today’s employees need more than salary and security from their job, they need the hours
they are putting towards the organization is giving them some value and meaning.
• In the system model, the expectations of the managers are much more than getting the
work done by the employees.
• The managers have to show their emotional side, be more compassionate and caring
towards their team and they must be sensitive towards the needs of the diverse workforce.
• They have to devote their attention to creating the feeling of optimisim, hope,
trustworthiness, courage , self-determination, and through this they try to develop the
positive work culture where are employees feel more at ease and work as if they are
working for their fami9ly
• This ultimately results in the long time commitment and loyality of the employees and the
success of the company.
ORGANIZATION BEHAVIOR
CHART
OB CHART BASED ON LEVELS

• The individual level includes each person within an

organization. Each acts differently which affects group
dynamics and the organization as a whole. If there are a lot
of happy and efficient individuals, the work environment
will be an efficient and productive one.

• The group level includes any groups within an

organization. Groups can range in size from a couple of
people working together, to a large group with dozens or
hundreds of members.
• Organization-level deals with analyzing the
organizational structure, and culture. And climate within
an organization. It studies how organizations differ based
on their organizational structure, work environment,
human resource policies, etc.
 EXAMPLE

• If I want to understand my manager’s personality, I would examine the

individual analysis level.

• If i want to know about how my manager’s personality affects my team, i

am examining things at the team level.

• But, if i want to understand how my organization’s culture affects my

manager’s behavior, i would be interested in the organizational level of
analysis.
 GOALS OF OB
• DESCRIBE EMPLOYEE BEHAVIOR
• UNDERSTAND EMPLOYEE BEHAVIOR
• PREDICT EMPLOYEE BEHAVIOR
• CONTROL HUMAN ACTIVITY
 OB DRAWS FROM OTHER
DISCIPLINES
• PERSONALITY & MOTIVATION – PSYCHOLOGY
• DECISION MAKING – ECONOMICS
• POWER & INFLUENCE IN ORGANIZATION – POLITICAL
SCIENCE
• STRESS & ITS EFFECTS ON INDIVIDUALS – MEDICAL
SCIENCE
• ATTITUDE CHANGE , GROUP PROCESS – SOCIAL
PSYCHOLOGY
 HISTORICAL DEVELOPMENT
OF OB

The formal discipline of management as we find it today evolved only

during the later part of nineteenth century.
• Scientific management
• Classical administration
• The human relations approach
• The systems approach
• The contingency approach
 SCIENTIFIC MANAGEMENT
FREDERICK WINSLOW TAYLOR
(1865-1915)
• He is known as the father of scientific management.

• He gave much concentration on the supervisory level of management and the

performance of managers and workers at an operational level.

• He suggested that the duty of management was to select, train, and help
workers to perform their jobs properly.

• The responsibility, of workers was simply to accept the new methods and
perform accordingly.
• The practical application of this approach was to break each job down into
its smallest and simplest component .

• Each single component became a separate, specialized job to be allocated to

a separate worker.

• Workers were selected and trained to perform such jobs in the most efficient
way possible, eliminating all wasted motions or unnecessary physical
movement.
 CONTD……

• COOPERATION, NOT INDIVIDUALISM [MANAGERS AND

WORKERS SHOULD HAVE MUTUAL COOPERATION AND
CONFIDENCE AND A SENSE OF GOODWILL.]

• DEVELOPMENT OF EVERY PERSON TO HIS GREATEST

EFFICIENCY [ THE TRAINING IS GIVEN TO THE RIGHT
EMPLOYEE, THE RIGHT STEPS SHOULD BE TAKEN AT THE TIME
OF SELECTION AND RECRUITING CANDIDATES BASED ON A
SCIENTIFIC SELECTION.]
 1. FUNCTIONAL
FOREMANSHIP

• Taylor suggested that the managerial activities should be divided into

two parts, i.E., Planning and production. There should be two
individual in charges appointed under the factory manager for carrying
out both of these activities holding the position of planning in charge
and production in charge, respectively.
 FACTORY MANAGER

• A factory manager is a person who holds the highest managerial

position in the unit and is responsible for the proper functioning of the
organization.

• Planning in charge: a planning in charge is responsible for the

formulation of policies, strategies and procedures of the operational
activities. To simplify the work, following four clerks are appointed
under the planning in charge:
• Instruction card clerk: the instruction card clerk will determine and direct
how the work has to be performed.

• Route clerk: a route clerk will decide what is to be done and the steps that
are to be taken to perform a particular task.

• Time and cost clerk: the person who determines the time limit in which the
work is to be completed and the cost involved in carrying out each task is
known as a time and cost clerk.

• Disciplinarian: a disciplinarian is a clerk who ensures discipline, following

rules and regulations and code of conduct in the organization.
 PRODUCTION IN CHARGE
• A production in charge needs to take care of all the operational and production

activities. The four clerks assigned under production in charge are as follows:

• Speed boss: the speed boss is responsible for getting the work done on time.

• Gang boss: the person who looks after the availability of all the equipment, tools,

and accessories is a gang boss.

• Repairs boss: the repairs boss has to take care of the repairs, and maintenance of

the tools and machinery used for production.

• Inspector: the inspector is responsible for ensuring that all activities are being

carried out in a planned manner. He/she also checks whether the quality of the

products are as per the standards or not.

 2. STANDARDIZATION AND SIMPLIFICATION OF WORK

Taylor suggested that there should be a fixed standard for everything, i.E., The
product, raw material, process, machinery and working conditions. This is to
save the time and cost and bring in specialization in the organization.
3. WORK-STUDY

• Taylor emphasized on examining and analyzing the working at the operational

level of the organization. It develops a systematic course of action and resolves
the problems faced by the labors and workers who are responsible for
accomplishing the given task and duties.
a. FATIGUE STUDY- According to taylor, the task can be accomplished
effectively and efficiently only if the worker is allowed to take the
required amount of rest during working hours.

Eg. The number of rest intervals, frequency of rest intervals, duration of each
rest interval.

B. METHOD STUDY- The managers come across numerous

ways of performing a particular task or carrying out the

production of goods or services. Out of all these possible

methods, the selection of the most appropriate way, which is

cost-effective and also increases the production is

considered a method study.

C. TIME STUDY- Analyzing the time consumed for carrying out the given
task in a specified manner is taylor’s other scientific management technique
which is called a time study. If an activity takes more time than the defined
standard, it may lead to delay and a decline in productivity.

D. MOTION STUDY- The examination of every movement of

the workers during working hours to find out the
unproductive tasks and activities come under motion study.
 4. DIFFERENTIAL PIECE WAGE SYSTEM

THE WAGES PAID TO THE WORKERS SHOULD BE BASED ON THEIR

PRODUCTION CAPABILITY, I.E., THE NUMBER OF PIECES LABOR
CAN MANUFACTURE IN A GIVEN PERIOD, INSTEAD OF A FIXED RATE
OF REMUNERATION. A STANDARD NUMBER OF UNITS OF
PRODUCTION SHOULD BE DETERMINED, AND THE WAGES SHOULD
BE DECIDED ACCORDINGLY. IF A WORKER IS UNABLE TO PRODUCE
THE USUAL QUANTITY, THEN SOME AMOUNT WILL BE DEDUCTED
FROM THE DECIDED REMUNERATION. HOWEVER, IF A WORKER
PRODUCES MORE THAN THE STANDARD NUMBER OF UNITS, HE OR
SHE WILL BE LIABLE FOR ADDITIONAL COMPENSATION.
 5. MENTAL REVOLUTION
A FRIENDLY AND CORDIAL WORK ENVIRONMENT LEADS TO
THE GROWTH OF THE ORGANIZATION AS WELL AS THE
INDIVIDUALS. THE EMPLOYEES SHOULD NOT CONSIDER
THEMSELVES AS JUST THE WORKERS OF THE ORGANIZATION
BUT BELIEVE THEMSELVES TO BE THE MEMBERS OF A
FAMILY. BOTH ORGANIZATIONS AND EMPLOYEES MUST VALUE
THE EFFORTS OF EACH OTHER AND WORK TOGETHER,
CREATING A POSITIVE ENVIRONMENT TO ACHIEVE COMMON
ORGANIZATIONAL GOALS AND OBJECTIVES.
 CLASSICAL ADMINISTRATION
THEORY
• Henri fayol was a french industrialist who put forward and popularized the
concept of the "universality of management principles." In other words, he
advocated that all organizations could be structured and managed according
to certain rational principles.

• He gave us the famous 14 principles of management. According to him, the

5 main managerial functions of management are planning, organizing,
commanding, coordinating and controlling.
• 1. DIVISION OF WORK - If an employee is given a specific task to do,
they will become more efficient and skilled in it. This is opposed to a multi-
tasking culture where an employee is given so many tasks to do at once. To
implement this principle effectively, look at the current skill sets of each
employee and assign them a task that they can become proficient at. This
will help them to become more productive, skilled, and efficient in the long
run.
• 2. AUTHORITY- A manager needs to have the necessary authority to
ensure that his instructions are carried out by the employees. If managers
did not have any authority, then they would lack the ability to get any work
done. However, this authority should come along with responsibility.

• So, there should be a balance between authority and responsibility. If there

is more authority than responsibility, the employees will get frustrated. If
there is more responsibility than authority, the manager will feel frustrated.
• 3. DISCIPLINE- To run any organization effectively, discipline is
required. To have disciplined employees, managers need to build a culture
of mutual respect. There should be a set of organizational rules,
philosophies, and structures in place that should be met by everyone.
Bending rules should not be allowed in any organization. To achieve this,
there is a need for good supervision and impartial judgment.
• 4. UNITY OF COMMAND- There should be a clear chain of command in
the organization. The employees should be clear on whose instructions to
follow. According to fayol, an employee should receive orders from only
one manager. If an employee works under two or more managers, then
authority, discipline, and stability are threatened. Moreover, this will cause a
breakdown in the management structure and cause employees to burn out.
• 5. UNITY OF DIRECTION- The work to be done should be organized in
such a way that employees work in harmony towards the same objective, using
one plan, under the direction of one manager.

• FOR EXAMPLE, If you have a range of marketing activities such as

advertising, budgeting, sales promotion, etc., There should be one manager
using one plan for all the marketing activities. The different activities can be
broken down for different sub-managers, but they should all work towards a
common goal under the direction of one main person in charge of the whole
thing.
• 6. COLLECTIVE INTEREST OVER INDIVIDUAL INTEREST- The
overall interest of the team should take precedence over personal ones. The
interest of the organization should not be sabotaged by the interest of an
individual. If anyone goes rogue, the organization will collapse.

• 7. EQUITY- It is a combination of kindness and justice. Managers should

use kindliness and justice towards everyone they manage. This creates

loyalty and devotion among the employees towards the organization they

work for.
• 8. Remuneration- employees should be paid fair wages for the work that
they carry out. Any organization that underpays its workers will struggle to
motivate and keep quality workers. This remuneration should include both
financial and non-financial incentives. Also, there should be a structure in
Place to reward good performance to motivate employees.
• 9. CENTRALIZATION- It refers to the concentration of power in the hands of

the authority and following a top-bottom approach to management. In

decentralization, this authority is distributed to all levels of management.

Complete centralization means that people at the bottom have no authority over

their responsibilities. Similarly, complete decentralization means that there will

be no superior authority to control the organization. To use this effectively today,

there should be a balance of centralization and decentralization. The degree to

which this balance is achieved will differ from organization to organization.

• 10. SCALAR CHAIN- It refers to a clear chain of communication between
employees and their superiors. Employees should know where they stand in
the hierarchy of the organization and who to go to in a chain of command.

• To implement this in the workplace, fayol suggests that there should be an

organizational chart drawn out for employees to see this structure.
• 11.ORDER- There should be an orderly placement of resources
(manpower, money, materials, etc.) In the right place at the right time. This
ensures the proper use of resources in a structured fashion. Misplacement of
any of these resources will lead to misuse and disorder in the organization.
• 12. STABILITY OF TENURE OF PERSONNEL- An organization

should work to minimize staff turnover and maximize efficiency. Any new

employee cannot be expected to get used to the culture of an organization

right away. They need to be given enough time to settle into their jobs to

become efficient.

• Both old and new employees should also be ensured job security.

• There should also be a clear and effective method to handle vacancies when

they arise because it takes time and expense to train new ones.
• 13. INITIATIVE- All employees should be encouraged to show initiative.

When employees have a say as to how best they can do their jobs, they feel

motivated and respected. Organizations should listen to the concerns of their

employees and encourage them to develop and carry out improvement

plans.
• 14. ESPRIT DE CORPS- it means “team spirit”.

• It states that the management should strive to create unity, morale, and co-
operation among the employees.

• Team spirit is a great source of strength in the organization.

• Happy and motivated employees are more likely to be productive and

efficient.
 THE HUMAN RELATIONS
MOVEMENT

• HUMAN RELATIONS MOVEMENT BEGAN IN THE 1930'S

AND CONTINUED IN VARIOUS FORMS UNTIL THE 1950'S.

• THE HUMAN RELATIONS MOVEMENT, POPULARIZED BY

ELTON MAYO AND HIS FAMOUS HAWTHORNE STUDIES
CONDUCTED AT THE HAWTHORNE PLANT OF THE
WESTERN ELECTRIC COMPANY
 NEO-CLASSICAL THEORY
• THE NEO-CLASSICAL THEORY IS THE EXTENDED VERSION OF THE
CLASSICAL THEORY WHEREIN THE BEHAVIORAL SCIENCES GETS
INCLUDED INTO THE MANAGEMENT.

• ACCORDING TO THIS THEORY, THE ORGANIZATION IS THE SOCIAL

SYSTEM, AND ITS PERFORMANCE DOES GET AFFECTED BY THE
HUMAN ACTIONS.

• NEOCLASSICAL THEORISTS CONCENTRATED ON ANSWERING

QUESTIONS RELATED TO THE BEST WAY TO MOTIVATE, STRUCTURE,
AND SUPPORT EMPLOYEES WITHIN THE ORGANIZATION.
• BEFORE THE HAWTHORNE STUDIES OFFICIALLY STARTED,
ELTON MAYO HEADED A RESEARCH TEAM, WHICH WAS
INVESTIGATING THE CAUSES OF VERY HIGH TURNOVER IN
THE MULE-SPINNING DEPARTMENT OF A PHILADELPHIA
TEXTILE MILL IN 1923 AND 1924.

• AFTER INTERVIEWING AND CONSULTING THE WORKERS, THE

TEAM SET UP A SERIES OF REST PAUSES, WHICH RESULTED
IN GREATLY REDUCED TURNOVER AND MORE POSITIVE
WORKER ATTITUDES AND MORALE.
 HAWTHORNE EXPERIMENT

• SOME OF THE MAJOR PHASES OF HAWTHORNE’S

EXPERIMENTS ARE AS FOLLOWS:
• 1. ILLUMINATION EXPERIMENTS (1924-27)
• 2. RELAY ASSEMBLY TEST ROOM EXPERIMENTS
(1927-28)
• 3. MASS INTERVIEWING PROGRAM (1928-30)
• 4. BANK WIRING OBSERVATION ROOM
EXPERIMENT (1931-32)
 1. ILLUMINATION
EXPERIMENTS

• ILLUMINATION EXPERIMENTS WERE UNDERTAKEN TO FIND OUT HOW

VARYING LEVELS OF ILLUMINATION (AMOUNT OF LIGHT AT THE
WORKPLACE) AFFECTED PRODUCTIVITY.

• THE HYPOTHESIS WAS THAT WITH HIGHER ILLUMINATION,

PRODUCTIVITY WOULD INCREASE.

• IN THE FIRST SERIES OF EXPERIMENTS, A GROUP OF WORKERS WAS

CHOSEN AND PLACED IN TWO SEPARATE GROUPS (EXPERIMENTAL
GROUP & CONTROL GROUP).

• CONTROL GROUP, CONTINUED TO WORK UNDER CONSTANT

INTENSITIES OF ILLUMINATION.
• THE RESEARCHERS FOUND THAT AS THEY INCREASED THE
ILLUMINATION IN THE EXPERIMENTAL GROUP, BOTH GROUPS
INCREASED PRODUCTION.

• WHEN THE INTENSITY OF ILLUMINATION DECREASED, THE

PRODUCTION CONTINUED TO INCREASE IN BOTH GROUPS.

• THE PRODUCTION IN THE EXPERIMENTAL GROUP DECREASED

ONLY WHEN THE ILLUMINATION WAS DECREASED TO THE LEVEL
OF MOONLIGHT. THE DECREASE WAS DUE TO LIGHT FALLING
MUCH BELOW THE NORMAL LEVEL.
• THUS, IT WAS CONCLUDED THAT ILLUMINATION DID NOT
HAVE ANY EFFECT ON PRODUCTIVITY BUT SOMETHING ELSE
WAS INTERFERING WITH THE PRODUCTIVITY.

• AT THAT TIME, IT WAS CONCLUDED THAT HUMAN FACTOR

WAS IMPORTANT IN DETERMINING PRODUCTIVITY BUT
WHICH ASPECT WAS AFFECTING, IT WAS NOT SURE.
THEREFORE, ANOTHER PHASE OF EXPERIMENTS WAS
UNDERTAKEN.
 2. RELAY ASSEMBLY TEST ROOM
EXPERIMENTS:

• RELAY ASSEMBLY TEST ROOM EXPERIMENTS WERE

DESIGNED TO DETERMINE THE EFFECT OF CHANGES IN
VARIOUS JOB CONDITIONS ON GROUP PRODUCTIVITY AS THE
ILLUMINATION EXPERIMENTS COULD NOT ESTABLISH A
RELATIONSHIP BETWEEN THE INTENSITY OF ILLUMINATION
AND PRODUCTION.

• FOR THIS PURPOSE, THE RESEARCHERS SET UP A RELAY

ASSEMBLY TEST ROOM TWO GIRLS WERE CHOSEN.
• THESE GIRLS WERE ASKED TO CHOOSE MORE GIRLS AS CO-
WORKERS. THE WORK RELATED TO THE ASSEMBLY OF TELEPHONE
RELAYS.

• EACH RELAY CONSISTED OF SEVERAL PARTS WHICH GIRLS

ASSEMBLED INTO FINISHED PRODUCTS.

• OUTPUT DEPENDED ON THE SPEED AND CONTINUITY WITH WHICH

GIRLS WORKED.

• THE EXPERIMENTS STARTED WITH INTRODUCING NUMEROUS

CHANGES IN SEQUENCE WITH A DURATION OF EACH CHANGE
RANGING FROM FOUR TO TWELVE WEEKS.
• AN OBSERVER WAS ASSOCIATED WITH GIRLS TO SUPERVISE
THEIR WORK.

• BEFORE EACH CHANGE WAS INTRODUCED, THE GIRLS WERE

CONSULTED.

• THEY WERE ALLOWED TO EXPRESS THEIR VIEWPOINTS AND

CONCERNS TO THE SUPERVISOR.

• IN SOME CASES, THEY WERE ALLOWED TO MAKE DECISIONS

ON MATTERS CONCERNING THEM.
• FOLLOWING WERE THE CHANGES AND RESULTANT OUTCOMES:

• 1. THE INCENTIVE SYSTEM WAS CHANGED. THE PRODUCTIVITY

INCREASES AS COMPARED TO BEFORE.

• 2. TWO FIVE-MINUTE RESTS ONE IN THE MORNING SESSION AND THE

OTHER IN THE EVENING SESSION WERE INTRODUCED WHICH WERE

INCREASED TO TEN MINUTES. PRODUCTIVITY INCREASED.

• 3. THE REST PERIOD WAS REDUCED TO FIVE MINUTES BUT

FREQUENCY WAS INCREASED. THE PRODUCTIVITY DECREASED

SLIGHTLY AND THE GIRLS COMPLAINED THAT FREQUENT REST
INTERVALS AFFECTED THE RHYTHM OF THE WORK.
• 4. THE NUMBER OF REST WAS REDUCED TO TWO OF TEN MINUTES EACH,
BUT IN THE MORNING, COFFEE OR SOUP WAS SERVED ALONG WITH THE
SANDWICH, AND IN THE EVENING, SNACKS WERE PROVIDED. PRODUCTIVITY
INCREASED.

• 5. CHANGES IN WORKING HOURS AND WORKDAY WERE INTRODUCED, SUCH

AS CUTTING AN HOUR OFF AT THE END OF THE DAY AND ELIMINATING
SATURDAY WORK. THE GIRLS WERE ALLOWED TO LEAVE AT 4.30 P.M.
INSTEAD OF THE USUAL 5.00 P.M. AND LATER AT 4.00 P.M. PRODUCTIVITY
INCREASED.

• AS EACH CHANGE WAS INTRODUCED, ABSENTEEISM DECREASED, MORALE

INCREASED, AND LESS SUPERVISION WAS REQUIRED.
 3. MASS INTERVIEWING
PROGRAM:

• DURING THE COURSE OF EXPERIMENTS, ABOUT 20,000

INTERVIEWS WERE CONDUCTED BETWEEN 1928 AND 1930
TO DETERMINE EMPLOYEES’ ATTITUDES TOWARDS THE
COMPANY, SUPERVISION, INSURANCE PLANS, PROMOTION,
AND WAGES.

• INITIALLY, THESE INTERVIEWS WERE CONDUCTED USING

DIRECT QUESTIONING SUCH AS “DO YOU LIKE YOUR
SUPERVISOR?” OR “IS HE IN YOUR OPINION FAIR OR
DOES HE HAVE FAVORITES?” ETC.
• THIS METHOD HAS THE DISADVANTAGE OF STIMULATING
OVERSIMPLIFIED ‘YES’ OR ‘NO’ RESPONSES WHICH COULD
NOT GET TO THE ROOT OF THE PROBLEM.

• SO, THE METHOD WAS CHANGED TO NON-DIRECTIVE

INTERVIEWING WHERE THE INTERVIEWER WAS ASKED TO
LISTEN INSTEAD OF TALKING, ARGUING, OR ADVISING. THE
INTERVIEW PROGRAM GAVE VALUABLE INSIGHTS INTO THE
HUMAN BEHAVIOR IN THE COMPANY.
 MAJOR FINDINGS OF THE
PROGRAM

• A COMPLAINT IS NOT NECESSARILY AN OBJECTIVE RECITAL OF FACTS; IT IS

A SYMPTOM OF PERSONAL DISTURBANCE THE CAUSE OF WHICH MAY BE
DEEP-SEATED.

• OBJECTS, PERSONS, OR EVENTS ARE RELATED TO EMPLOYEE

SATISFACTION OR DISSATISFACTION ONLY.

• THE PERSONAL SITUATION OF THE WORKER IS A CONFIGURATION.

• POSITION OR STATUS OF THE WORKER IN THE COMPANY IS A REFERENCE

FROM WHICH THE WORKER ASSIGNS MEANING AND VALUE TO THE
EVENTS, OBJECTS AND FEATURES OF HIS ENVIRONMENT SUCH AS HOURS
OF WORK, WAGES, ETC.
 4. BANK WIRING OBSERVATION ROOM
EXPERIMENT:

• THESE EXPERIMENTS WERE CONDUCTED TO FIND OUT THE

IMPACT OF SMALL GROUPS ON THE INDIVIDUALS.

• IN THIS EXPERIMENT, A GROUP OF 14 MALE WORKERS WAS

FORMED INTO A SMALL WORKGROUP.

• THE MEN WERE ENGAGED IN THE ASSEMBLY OF TERMINAL

BANKS FOR THE USE OF TELEPHONE EXCHANGES.

• THE WORK INVOLVED ATTACHING WIRES WITH SWITCHES

FOR CERTAIN EQUIPMENT USED IN TELEPHONE EXCHANGES.
• HOURLY WAGE FOR EACH WORKER WAS FIXED BASED ON THE AVERAGE OUTPUT

OF EACH WORKER. BONUS IS ALSO PAYABLE BASED ON GROUP EFFORT.

• IT WAS EXPECTED THAT HIGHLY EFFICIENT WORKERS WOULD PUT PRESSURE ON

LESS EFFICIENT WORKERS TO INCREASE OUTPUT AND TAKE ADVANTAGE OF THE

GROUP INCENTIVE PLAN.

• HOWEVER, THE STRATEGY DID NOT WORK AND WORKERS ESTABLISHED THEIR

STANDARD OF OUTPUT.

• THE WORKERS CITED VARIOUS REASONS FOR THIS BEHAVIOR VIZ. FEAR OF

UNEMPLOYMENT, FEAR OF AN INCREASE IN OUTPUT, DESIRE TO PROTECT SLOW

WORKERS, ETC.
• THE HAWTHORNE EXPERIMENTS CLEARLY SHOWED THAT A MAN

AT WORK IS MOTIVATED BY MORE THAN THE SATISFACTION OF

ECONOMIC NEEDS. MANAGEMENT SHOULD RECOGNIZE THAT

PEOPLE ARE ESSENTIALLY SOCIAL BEINGS AND NOT MERELY

ECONOMIC BEINGS. AS A SOCIAL BEING, THEY ARE MEMBERS

OF A GROUP AND THE MANAGEMENT SHOULD TRY TO

UNDERSTAND GROUP ATTITUDES AND GROUP PSYCHOLOGY.

 MAX WEBER’S THEORY OF
BUREAUCRACY

• AFTER STUDYING THE CAPITALIST INDUSTRIES OF GERMANY

AND THE US, WEBER CONCLUDED THAT A RATIONAL
ORGANIZATION IS THE BEST WAY TO SET UP AN
ORGANIZATION. HE NAMED THIS ‘RATIONAL ORGANIZATION’
AS BUREAUCRACY.

• IN BUREAUCRATIC MANAGEMENT, ALL MEMBERS OF THE

ORGANIZATION ARE TREATED EQUALLY AND DIVISION OF
LABOR IS CLEARLY DEFINED.
• ACCORDING TO MAX WEBER BUREAUCRACY IS AN

ORGANIZATIONAL STRUCTURE THAT IS CHARACTERIZED BY

MANY RULES, STANDARDIZED PROCESSES, PROCEDURES

AND REQUIREMENTS, NUMBER OF DESKS, THE METICULOUS

DIVISION OF LABOR AND RESPONSIBILITY, CLEAR

HIERARCHIES, AND PROFESSIONAL, ALMOST IMPERSONAL

INTERACTIONS BETWEEN EMPLOYEES.’

 MAX WEBER’S SIX PRINCIPLES OF
BUREAUCRACY

• Task specialization

• Formal selection

• Impersonal (impersonality and personal indifference)

• Hierarchical layers of authority

• Rules and regulations

• Career orientation
 CRITICISMS OF WEBERIAN BUREAUCRACY

• Highly rigid and strict regulations to follow for the employees and the
managers

• Requires A ton of paperwork which contributes to A huge waste of money,

effort, and time

• A large number of rules and formalities tend to delay the decision-making

process and, thereby, important business tasks
• The bureaucratic structure usually suits government
organizations, but businesses need quick decision-making,
which is not A characteristic of max weber’s bureaucracy.
That’s why it is not beneficial for corporate organizations

• Only focuses on the technical skills of workers and neglects

the employee’s dedication, hard work, and commitment

• It can get difficult for employees and managers to

communicate and coordinate among themselves
SYSTEMS APPROACH TO MANAGEMENT

• THE SYSTEMS APPROACH TO MANAGEMENT THEORY, COMMONLY

VIEWED AS THE FOUNDATION OF ORGANIZATIONAL DEVELOPMENT,
VIEWS THE ORGANIZATION AS AN OPEN SYSTEM MADE UP OF
INTERRELATED AND INTERDEPENDENT PARTS THAT INTERACT AS SUB-
SYSTEMS.

• FOR EXAMPLE, A FIRM IS A SYSTEM THAT MAY BE COMPOSED OF SUB-

SYSTEMS SUCH AS PRODUCTION, MARKETING, FINANCE, ACCOUNTING,
AND SO ON. AS SUCH, THE VARIOUS SUB-SYSTEMS SHOULD BE STUDIED
IN THEIR INTER-RELATIONSHIPS RATHER, THAN IN ISOLATION FROM
EACH OTHER.
 COMPONENTS OF AN ORGANIZATIONAL
SYSTEM

• THE SYSTEM APPROACH ENVISIONS THE ORGANIZATION AS MADE UP OF FIVE

COMPONENTS:

• INPUTS - RAW MATERIALS, HUMAN RESOURCES, CAPITAL, INFORMATION, TECHNOLOGY

• A TRANSFORMATIONAL PROCESS - EMPLOYEE WORK ACTIVITIES, MANAGEMENT

ACTIVITIES, OPERATIONS METHODS

• OUTPUTS - PRODUCTS OR SERVICES, FINANCIAL RESULTS, INFORMATION, HUMAN

RESULTS

• FEEDBACK - RESULTS FROM OUTPUTS INFLUENCE INPUTS.

• THE ENVIRONMENT - THESE COMPONENTS MAKE UP INTERNAL AND EXTERNAL

FACTORS THAT AFFECT THE SYSTEM.

 LIMITATIONS OF
ORGANIZATIONAL BEHAVIOR

3 MAJOR LIMITATIONS OF OB ARE

• BEHAVIORAL BIAS.

• THE LAW OF DIMINISHING RETURNS. [AT SOME POINT,

INCREASES OF A DESIRABLE PRACTICE PRODUCE DECLINING
RETURNS, FINALLY RESULTING IN ZERO RETURNS, AND THEN
FOLLOWS NEGATIVE RETURNS AS MORE INCREASES ARE
ADDED.]

• UNETHICAL MANIPULATION OF PEOPLE.