Unit 1

Definition, Nature, Scope and Significance of OB

Organizational behaviour is the academic study of how people interact within groups. The
principles of the study of organizational behaviour are applied primarily in attempts to make
businesses operate more effectively.

Organizational behaviour is the academic study of how people interact within groups and its
principles are applied primarily in attempts to make businesses operate more effectively.

 The study of organizational behaviour includes areas of research dedicated to

improving job performance, increasing job satisfaction, promoting innovation, and
encouraging leadership and is a foundation of corporate human resources.
 The Hawthorne Effect, which describes the way test subjects' behaviour may change
when they know they are being observed, is the best-known study of organizational
behaviour.
 Organizational behaviour is embedded in human resources such as employee
retention, engagement, training, and culture.
 Organizational behaviour is a subset of organizational theory which studies a more
holistic way of structuring a company and managing its resources.

The study of organizational behaviour includes areas of research dedicated to improving job
performance, increasing job satisfaction, promoting innovation, and encouraging leadership.
Each has its own recommended actions, such as reorganizing groups, modifying
compensation structures, or changing methods of performance evaluation.

Organizational Behaviour is concerned with the understanding, prediction and control of

human behaviour in organizations. It focuses on the individuals, the groups and the
organization and also on their interactional relationships. It is the study and application of
knowledge about how people act with organizations.

It is a human tool for human benefit. It applies broadly to the behaviour of people in all
types of organizations. Wherever organizations are, there is a need to understand
organizational behaviour. According to Fred Luthans, “Organisational behaviour is directly
concerned with the understanding, production and control of human behaviour in
organisations.”

So, the study of group interactions inside organisations is known as organisational

behaviour. It examines the behaviours of individuals and groups inside an organisation and
how they impact its diverse operations. It also looks at how businesses can become more
productive by using their knowledge of human behaviour within the organisation’s
structure. Organisations may improve their understanding of employee behaviour and how
to foster a more effective workplace by researching organisational behaviour models.
NATURE

The nature/ characteristics of OB are as given below:

1. OB is a part of general management and not the whole of management. It represents
behavioural approach to management.

2. OB contains a body of theory, research and application associated with a growing

concern for people at the work place. It helps in understanding human behaviour in
work organizations.

3. OB is a human tool for human benefit. It helps in predicting the behaviour of

individuals.

4. OB is inter-disciplinary field of study. It tries to synthesize knowledge drawn from

various behavioural and social sciences such as Psychology, Sociology,
Anthropology, Political-science, Economics, etc. In fact, OB is an applied
behavioural sciences.

5. OB involves three levels of analysis of behaviour-individual behaviour, group

behaviour and behaviour of the organization itself.

6. OB is an action-oriented and goal-directed discipline. It provides a rational thinking

about people and their behaviour

7. OB is both a science and an art. The systematic knowledge about human behaviour
is a science. The application of behavioural knowledge and skills clearly leans
towards being an art.

8. OB seeks to fulfil both employees’ needs and organizational objectives.

SCOPE OF OB

“OB is a field of study that investigates the impact that individuals, groups, and
structure have on behaviour within organizations, for the purpose of applying such
knowledge towards improving an organisation’s effectiveness”.

The scope of OB involves three levels of behaviour in organizations: individuals,

groups and structure.

1. Individual Behaviour

This dimension of organisational behaviour concentrates on examining workers’ beliefs,

attitudes, perspectives, and personal characteristics to ascertain their behavioural patterns
at work. Its analysis is based on human psychology. It includes

(i) Personality
 (ii) Perception
(iii) Values and Attitudes
(iv) Learning
(v) Motivation

2. Group Behaviour

The examination at the group level, also known as the team level, looks at how workers
behave when collaborating and explores various group concepts, including power, conflict
resolution, group dynamics, and leadership. It controls how individuals and a group of
individuals behave in a social setting. The team-level analysis is built on the foundation of
sociology and social psychology.

(i) Work groups and group dynamics

(ii) Dynamics of conflict
(iii) Communication
(iv) Leadership
(v) Morale

3. Organization Behaviour

This level is concerned with examining an organisation’s climate, culture, and structure. It
examines how different organisational structures, work environments, human resource
practices, and other factors influence organisations’ operations. Organisation system-level
analysis is built on a foundation of sociology and political science.

(i) Organizational Climate

(ii) Organizational Culture
(iii) Organizational Change
(iv) Organizational Effectiveness
(v) Organizational Development

SIGNIFICANCE OF ORGANIZATION BEHAVIOR

1. It builds better relationships by achieving, people, organizational, and social objectives.

2. It covers a wide array of human resources like Behaviour, training and
development, change management, leadership, teams etc.
3. It brings coordination which is the essence of management.
4. It improves the goodwill of the organization.
5. It helps to achieve objectives quickly.
6. It makes optimum utilization of resources.
7. It facilitates motivation.
8.
9. It leads to higher efficiency.
 10. It improves relations in the organization.
11. It is multidisciplinary in the sense that applies different techniques, methods, and
theories to evaluate the performances.
.

The Main Objectives of Organisational Behaviour

The several objectives of organisational behaviour are:-

 To create a social structure within the organisation.

 To inspire employees to work energetically for the company.
 To construct a setting that will foster good leadership.
 To help the staff members cultivate successful group behaviour.
 To determine the conflict’s causes and find a solution.
 To identify the sources of dissatisfaction and take steps to mitigate or eliminate those
sources.
 To boost the organisation’s workforce’s morale.
 To keep the workplace atmosphere favourable inside the business.

Key Elements of Organisational Behaviour

Organisational behaviour models and theories consider four key elements:-

1. People:

They make up the organisation’s internal and social structure. People include the
organisation’s stakeholders (those impacted by its actions), workers, and groups.

2. Structure:

In an organisation, work is conducted according to a system of official and informal norms

and procedures. Also, it comprises hierarchies, communication networks, regulations,
processes, and other similar elements.

3. Technology:

It is the umbrella term for all the resources a company uses to accomplish its goals,
including machinery, software, tools, gadgets, and operational procedures.

4. Environment:
The social aspects that an organisation’s personnel are impacted by outside the
organisation. Cultural, economic, technical, political, and legal aspects are all included.

Importance of organisational behaviour

Some specific reasons why OB is important:

1. Improves communication: Studying OB helps understand and detangle the

communication patterns within an organisation. This helps the authorities
communicate better with the employees and stakeholders.
2. Increases productivity: Studying organisational behaviour theories provides insight
into the factors that promote job satisfaction and boost productivity at the workplace.
The results derived from the studies can be conceptualised effectively to produce
optimal outputs.
3. Enhances job satisfaction: Just like understanding OB theories and models enhances
productivity, it also helps understand employee satisfaction. This helps build a
healthier workplace for everyone working in the organisation.
4. Reduces turnover: Creating a healthy, positive environment ensures less employee
turnover. This also helps build a good reputation for the organisation at large.
5. Helps manage change: OB models, such as Lewin’s Change Management Model,
help the authorities understand how the stakeholders and employees would accept a
change within the organisation.

Organisation behaviour as a field of study

Organizational behaviour is the study of how individuals and groups interact within an
organization and how these interactions affect an organization’s performance toward its goal
or goals. The field examines the impact of various factors on behaviour within an
organization.

The focus of organizational behaviour tends to centre on employee productivity. For

example, organizational behaviour studies have shown that employees who feel valued and
appreciated tend to be more motivated and productive, leading to increased profits for the
organization. However, organizational behaviour can also focus on the ways in which
organizations can better manage, change and improve behaviour in order to achieve desired
outcomes (i.e., productivity, employee well-being, or workplace satisfaction).

Various Frameworks of Organisational Behaviour

There are three major frameworks of organisational behaviour.

1. Cognitive Framework: It includes the positive and freewill aspects of human behaviour.
Cognitive framework of OB is based on the concept of:

 The expectancy of the human being

 The demand of the human being
 The intention of the human being

Cognitive framework simply means that every individual set his goal and he also know the
behaviour will take him to achieve the goal.

This cognitive framework is useful in analysing perception, personality, motivation, decision

making of human in the organisation.

2. Behaviourist Framework: It is advisable and fruitful to study the behaviour of the human
being which is visible than studying the mind which is elusive in nature. The concept of the
Behavioural Framework of Organizational Behaviour can be clearly explained with the help
of Stimulus and response. This is also called as Behaviouristic Framework of Organisational
Behaviour. It mainly focus on stimulus and response.

Stimulus is the force of action or motivation and response is the reaction or the behaviour.
Behaviour is not the outcome of stimulus alone, but it is an outcome that also depends on
contingent environmental consequences of a behaviour. This means that a human can project
different behaviour for the same stimulus and he exhibits a response depending on
environmental consequences. Overall it can be said that the Behavioural framework based on
observable behaviour and observable environmental variables.

3. Social cognitive framework: The Social Cognitive Theory is a framework that will give a
base to understand human behaviour. The social cognitive Framework in Organisational
Behaviour states that the person and the external situations are interdependence with each
other along with the behaviour itself to determine the behaviour. It means that along with
cognitive and external situation the experiences faced through relevant past events determines
what a person becomes and this will create an impact in subsequent behaviour.

This framework of organisational behaviour considers cognitive and environmental variables.

Bandura identified five basic human capabilities as a part of Social Cognitive Theory or
framework of organizational behaviour.

Symbolizing:
People process visual experiences into cognitive models. They help in future action.
Forethought:
Employees plan their actions.

Observational:
Employees learn by observing the performance of the referent group (peers, supervisors and
high performers) and the consequences of their actions.
Self-regulatory:
Employees self-regulate their actions by setting internal standards (aspired level of
performance).

Self-reflective:
Employees reflect back on their actions (how did I do?) and perceptually determine how they
believe they can successfully accomplish the task in the future given the context (probability
of success between 0 to 100% is estimated)

Contributions of other disciplines

Organizational Behaviour (OB) refers to the study of human behaviour in organization. There

are some important disciplines in organizational behaviour field which developed it

extensively. Since, organization affects an individual and is affected by the individual, so

both have to be read together. Thus, Stephen P Robbins defines ‘OB’ as a field of study that

examines the influence of individuals, groups, and structure on behaviour within an

organization, and then applies that knowledge to organizational betterment. Organisational

behaviour is an interdisciplinary approach as it has borrowed concepts, theories, models and

practices of physical sciences as well as social sciences. The main features of organisational

behaviour are primarily based on behavioural sciences. The organisational behaviour is

studied in relation to psychology, sociology, political science, anthropology, economics,

science, technology and environmental sciences. OB is, in fact, called an applied behavioural

science.

People do not work in isolation. When they join an organization, they come in contact with
other people and organizations. When they get exposed to managers, co-workers,
organizational policies, formal structure with their prior experience, values, culture etc., they
change. The organization is also affected by individual’s presence, and ultimately by their
absence. Therefore, in the study of organizational behaviour the methods should consider the
ways in which individuals and organizations interact.

The relationship of OB with other fields of study is depicted in the following diagram:
Psychology:

The term ‘psychology’ is derived from the Greek World ‘Psyche’ which means ‘soul’ or

‘spirit’. Organisational behaviour studies human behaviour which is concerned mainly with

the psychology of the people. Psychology, especially, industrial or organisational psychology

is the greatest contributor to the field of organisational behaviour. Psychologists study

behaviour and industrial or organisational psychologists deal specifically with the behaviour

of people in organisational settings.

Psychology as a science, measures, explains and suggests the appropriate human behaviour.

Individual behaviour is governed by perception, learning and personality. Industrial

psychology understands people’s behaviour at work, particularly under different working

conditions, stress, conflicts and other related behaviour of employees. Job satisfaction,

performance appraisals and reward systems are measured and directed with the use of

psychological theories and models.

Group behaviour in the organisations is studied, researched and moulded with the use of

theories of Social Psychology. The communication system in the organisation, attitudes of

employees, their needs etc. as a subject of social psychology have a great influence on

behaviour. Thus, many of the concepts which interest psychologists e.g. learning, motivation

etc. are also central to the students of organisational behaviour.

Sociology:

Sociology also has a major impact on the study of organisational behaviour. Sociology makes

use of scientific methods in accumulating knowledge about the social behaviour of the

groups. Sociologists study social systems such as a family, an occupational class, a mob or an

organisation. It specifically studies, social groups, social behaviour, society, customs,

institutions, social classes, status, social mobility, prestige etc.

It studies the behaviour of the people in the society in relation to their fellow human beings.

Sociology contributes to organisational behaviour through its contribution to the study of

interpersonal dynamics like leadership, group dynamics, communication etc. Socialisation is

accepted for moulding the behaviour of people where the capacities of individuals to learn

and respond to social systems, values, norms and social roles are accelerated and appreciated.

The attitudes and behavioural patterns of individuals and groups are greatly influenced by

socialisation.

Anthropology:

Anthropology is concerned with the interactions between people and their environment,

especially their cultural environment. Culture is a major influence on the structure of

organisations as well as on the behaviour of people within organisations. ‘Anthropo’ is a

Greek word which means ‘man’ and ‘logy’ means ‘Science’. Aristotle defined anthropology

as a science of man’s self-understanding. It particularly studies civilization, forms of cultures

and their impact on individuals and groups, biological features of man and evolutionary

pattern, speech and relationship among languages.

Anthropology contributes in understanding the cultural effects on organisational behaviour,

effects of value systems, norms, sentiments, cohesion and interaction. Socialization involves

spreading of values and missions of organisation among employees. Anthropology influences

the employees’ behaviour through motivation, interaction, goal setting, decision making,

coordinating and controlling.

Political Science:

In recent times, political science has also started interesting the organisational behaviourists.

Political Science is usually, thought of as the study of political systems. But political

scientists are interested in how and why people acquire power, political behaviour, decision

making, conflict, the behaviour of interest groups and coalition formation. These are also

major areas of interest in organisational behaviour.

Political parties and Government directly intervene in many activities of the organisation.

Specific principles of political science are observed in organisational behaviour for

delegation of authority and responsibility, conflict resolution and stress management.

In organisations, people strive for power and leadership recognition. Political Science helps

in the management of men in an effective and efficient manner. Political perspectives and

government policies are thoroughly analysed for moulding and modifying the behaviour of

people, because they greatly influence the organisation. The law and order of the country

influence the people at work.

Economics:

Economists study the production, distribution and consumption of goods and services.

Students of organisational behaviour share the economist’s interest in such areas as labour

market dynamics, productivity, human resource planning and forecasting, and cost benefit

analysis.

The economic conditions of a country have long lasting impact on organizational behaviour.

If psychological and economic expectations of employee are met, they are satisfied and

become high performers. Economic systems include financial, commercial and industrial

activities which have greater influences on the behaviour of the people. The consumption

pattern in society monitors the behaviour of employees. Consumption oriented society

witnesses a different employee behaviour from that of a production oriented society.

Science:
Science is systematized knowledge. The scientific methods attempt to produce information

that is objective in the sense that it is certifiable and independent of a person’s opinions or

preferences. Scientific method is the backbone of organisational behaviour. Organisational

behaviour is based on the systematized study of facts, behaviour, their relationships and

predictions.

New scientific methods viz. observation of facts and behaviour, explanation of facts and

relationships and coming to conclusion thereon have become important bases of the study of

organisational behaviour. The cause and effect relationship is also established in

organisational behaviour like that of science. The verification of the relationship and its

quantification has added to the importance of organisational behaviour.

It becomes relatively easy to predict and mould the people at work. A researcher, in the field

of OB investigates new facts, tests theories, hypothesis and models. Personal bias,

superfluous conclusions and whimsical approaches are avoided in the study. A systematized

form of inquiry is used for the study of various problems.

Technology:

The level of technological development affects the behaviour of the employees. Modern age

is the age of computerization. It has come within the framework of the model of

organisational behaviour. The study of technological development is becoming essential for

understanding the organisational behaviour, because people are influenced by the

technological development. Human behaviour relations and environments develop as a result

of technological innovations.

Technology changes consumer behaviour, production activities, and distribution and storage

activities. To cope up with the technological development people have to become educated

and/or technically skilled. They should have to be responsibility conscious and development

oriented. Unskilled or irresponsible will have no place in the modern innovative age. Thus,
technological development leads to effective work behaviour, improved organisational

culture and helpful work environment.

Engineering:

Engineering also influences the study of organisational behaviour. Some topics are common

to engineering as well as organisational behaviour e.g. work measurement, productivity

measurement, work flow analysis, work design, job design and labour relations. In fact,

organisational behaviour is dependent on engineering for these technical jobs.

Medicine:

Nowadays, medicine has also come in connection with the study of human behaviour at

work. Stress is becoming a very common problem in the organisations as well as in the

people working in the organisations. Research shows that controlling the causes and

consequences of stress in and out of organisational settings, is important for the well-being of

the individual as well as the organisations. Medicine helps in the control of stress as well as

stress related problems.

Thus, it can be concluded that organisational behaviour has an interdisciplinary focus. It

draws from a variety of other fields and attempts to describe behaviour as opposed to

prescribing how behaviour can be changed in consistent and predictable ways.

Organisation Behaviour Models

1. The Autocratic Model

Also known as the Authoritarian Model, this model’s fundamental level is power.
According to this paradigm, the workers are focused on compliance and discipline. The
top management is the only group with power.

All decisions, strategies, and policies are made by the senior management in a company
that follows an authoritarian style. Lower-level personnel are required to comply with
senior management’s directives. They must comply; if not, they risk punishment or
termination.
Under this model, people tend to get easily irritated due to the lack of security, reliance on
superiors, and minimal performance following low pay. These are the main problems of
this model.

2. Custodial model

According to this paradigm, an equitable remuneration structure boosts employee

enthusiasm and productivity inside the company. Giving employees numerous financial
and non-financial perks, including job stability, fair compensation, bonuses, paid time off,
and prizes, is the main goal of this strategy, which aims to keep great staff and boost
motivation and productivity.

The custodial model assumes that employees will work more and stay longer when they
are paid fairly.

Businesses use this strategy with substantial resources. It is reliant on financial resources.
This strategy encourages relying on the company rather than the management or boss.
People cooperate passively because they are content but not very motivated.

3. Supportive model

This approach assumes that although employees may be somewhat self-motivated, they
nevertheless require managerial help to achieve their best. As a result, a supportive model
aims to strengthen the interaction between managers and their staff members.

It emphasises the psychology, inspiration, and zeal of workers. Here, the supervisor is a
great proponent of motivating staff to do better.

The supportive model works best when there is a positive work atmosphere, management
support, stronger relationships, harmony, good communication, etc. Workers experience a
sense of involvement.

4. Collegial model

Collegial refers to a situation where groups of coworkers share responsibilities. This model
places a strong emv,phasis on encouraging collaboration inside the company.
The manager serves both as a mentor and a member of the team. Their job is to encourage
teamwork and make sure the team performs well. They routinely encourage cooperation
and keep track of outcomes.

This approach presupposes teamwork is superior to working alone and can lead to more
significant outcomes. As managers and employees collaborate as a team, their bonds
become stronger, they attend crucial meetings, their opinions are respected, everyone
appears to respect one another, and a harmonious work atmosphere is produced.

5. System model

The system model discusses the organisational structure, culture, working environment,
and consistent policies.

It works to achieve a balance between the objectives of the individual and the organisation,
assuming that people have varying goals, abilities, and potential. Managers and staff
members of the organisation invest their interests to help and achieve established
objectives. All staff members and management should feel that they have a relationship
with the organisation and agree on how to accomplish shared objectives.

A positive workplace atmosphere, communication and collaboration, and value to

employees and the community are only a few advantages of the system model.

Challenges and Opportunities of Organizational Behavior

1. Improving People’s Skills: – Technological changes, structural changes, environmental

changes occur at a rapid pace in the business sector. Unless employees and executives are
equipped to have the necessary skills to adapt to those changes, targeted goals may not be
achieved in a timely manner. These are two different categories of skills – managerial
skills and technical skills. Some of the managerial skills include listening skills,
motivational skills, planning and organizing skills, leading skills, problem solving skills,
decision making skills. These skills can be enhanced by conducting a range of training and
development programmes, career development programmes, induction and socialisation.

2. Improving Quality and Productivity: – Quality is the extent to which customers or users
believe that the product or service exceeds their needs and expectations. For example, a
customer who buys an automobile has a certain expectation, one of which is that the
automobile will start when the engine is started. If the engine does not start, the
customer’s expectations will not be met and the customer will find the quality of the car to
be poor. The major dimensions of quality are as follows: –
 o Performance: -Primary rating characteristics of a product such as signal coverage,
audio quality, display quality, etc.
o Features: – Secondary features, additional features, such as calculator, and alarm clock
features in the handphone
o Conformity: – meeting specifications or industry standards, the degree of
workmanship to which the product’s design or operating characteristics match pre-
established standards
o Reliability: – The probability of a product falling out within a specified period
o Durability: – It is a measure of the life of a product having both economic and
technical dimensions.
o Services: – Problem and complaints resolution, Ease of repair
o Feedback: – Human-to-human interfaces, such as Courtesy of Dealer « Aesthetics:
Sensory features such as exterior finishes.
o Reputations: – Past performance and other abstractions, such as being in the first
place.
More and more managers are facing challenges to meet the specific needs of customers. To
improve quality and productivity, they are implementing programs like total quality
management and reengineering programs that require extensive employee participation.

3. Total Quality Management (TQM): – Total Quality Management (TQM) is a

philosophy of management driven by continuous achievement of customer satisfaction
through continuous improvement of all organizational processes. The components of
TQM are: –
o an intense focus on the customer,
o concern for continuous improvement,
o improving the quality of what the organization does,
o accurate measurement and,
o Empowerment of employees.
4. Managing Workforce Diversity: – It refers to employing different categories of
employees who are heterogeneous in terms of gender, caste, ethnicity, affiliation,
community, physically disadvantaged, elderly people etc. The primary reason for
employing a heterogeneous range of employees is to harness talent and potential, harness
innovation, to achieve synergistic effects among the divorced workforce. In general,
employees wanted to maintain their personal and cultural identity, values, and lifestyle,
even if they were working in the same organization with similar rules and regulations. The
biggest challenge for organizations is to become more accommodating to different groups
of people by addressing their different lifestyles, family needs and work styles.
5. Responding to Globalization: – Today’s business is mostly market-driven; wherever the
demands exist irrespective of distance, locations, climatic conditions, the business
operations are expanded to gain their market share and to remain in the top rank, etc.
Business operations are no longer restricted to a particular locality or region. The
company’s products or services are spreading across the nations by using mass
communication, internet, fast transportation etc. More than 95% of Nokia handsets are
sold outside their home country of Finland, Japanese cars are being sold in different parts
of the world, Sri Lankan tea is exported to many cities across the world, Garment products
from Bangladesh are exported to USA and EU countries. Executives of multinational
corporations are very dynamic and move more frequently from one subsidiary to another.
6. Empowering People: – The main issue is to delegate more power and responsibility to
the lower-level cadre of employees and to provide more freedom to make choices
regarding their schedules, operations, procedures and method of solving problems related
 to their work. Encouraging employees to participate in work-related decisions will
significantly increase their commitment to work. Empowerment is defined as putting
employees in charge of the work they do by gaining some kind of ownership. Managers
are going far ahead by allowing employees complete control over their work. The
movement implies constant change, with an increasing number of organizations using
self-managed teams, where workers largely work without bosses.
7. Coping with Temporariness: In recent times, product life cycles are shortening,
operating methods are improving, and fashion is changing very rapidly. In those days,
managers were required to undertake major transformation programs once or twice a
decade. Today, change is an ongoing activity for most managers. The concept of
continuous improvement refers to continuous change. In the old years, there used to be a
long period of stability and sometimes interrupted by a short period of change, but at
present, the change process is an ongoing activity due to competition in developing new
products and services with better features. Everyone in the organization today is facing
permanent impermanence. The actual work to be done by the workers is in a permanent
state of flow. Hence, workers need to constantly update their knowledge and skills to meet
the requirements of the new job.
8. Stimulating Innovation and Change: – Today’s successful organizations must foster
innovation and master the art of change; Otherwise, they will become candidates for
extinction over time and disappear from their field of business. Wins will go to
organizations that maintain flexibility, continually improve their quality, and beat the
competition with a constant stream of innovative products and services in the market
place. For example, Compaq was successful in making more powerful personal computers
than EBNM or Apple for the same or less money, and in getting their products to market
faster than larger competitors.
9. The Emergence of E-Organisation & E-Commerce: – It refers to business operations
involving electronic mode of transaction. This includes presenting products on websites
and filling orders. Most of the articles and media attention given to using the Internet in
business has focused on online shopping. The process involves marketing and selling of
goods and services on the Internet. In e-commerce, the following activities are happening
quite frequently – with a tremendous number of people shopping on the internet, business
houses setting up websites where they can sell goods, following transactions such as
receiving payments and fulfilling orders.
10. Improving Ethical Behavior: – Complexity in business operations is forcing the
workforce to face ethical dilemmas where they need to define right and wrong conduct to
carry out their assigned activities. For example, should employees of a chemical company
blow the whistle if they uncover that its untreated waste in the river is polluting its water
resources? Do managers give an inflated performance appraisal to an employee of their
choice, knowing that such an appraisal could save that employee’s job? The basic rules
governing the components of good ethical behavior are not clearly defined, separating
right things from bad behavior becoming more blurred. It has become a common practice
to follow unethical practices such as successful executives who use insider information for
personal financial gain, employees in competing businesses participating in mass cover-
ups of defective products, etc.
11. Improving Customer Service: – OBs can contribute to improving organizational
performance by showing how employee attitudes and behaviors are correlated with
customer satisfaction. In that case, the service must first be production-oriented, using
technological opportunities such as computers, internet, etc. We also need to provide sales
service and also after-sales service in order to improve customer service.
 12. Helping Employees Balance Work-Life Conflicts: – In the 1960s or 1970s, normal
workers showed up at the workplace from Monday to Friday and worked 8 or 9 hours a
day. Workplaces and hours were specified. This is no longer true for a large part of
today’s workforce. Employees are increasingly complaining that the line between work
and non-work time has become blurred, leading to personal conflict and tension. Several
forces have contributed to the blurring of the lines between the working life and personal
life of the employees, such as
o The creation of global organizations means that their world never sleeps. For example,
at any given time and on any given day, there are thousands of General Electric
employees working somewhere.
o Communication technology allows employees to do their jobs at home, in their cars or
on the beach in Cox’s Bazar.
o Organizations are asking employees to work longer hours.
o In the end, fewer families have only one breadwinner. Today’s married worker is
usually part of a couple with a dual career. This makes it difficult for married
employees to find time to meet commitments to the home, spouse, children, parents,
and friends.
o Today’s married worker is usually part of a couple with a dual career. This makes it
difficult for married employees to find time to meet commitments to the home, spouse,
children, parents, and friends. Employees are increasingly recognizing that work is
squeezing personal lives and they are not happy with it.
13. Flattening World: Thomas Friedman’s book The World Is Flat: A Brief History of the
Twenty-First Century outlines that the Internet has “flattened” the world and created an
environment in which more access to information is needed. There is a level playing field.
This access to information has led to an increase in innovation, as knowledge can be
shared quickly across time zones and cultures. It has also created intense competition, as
the pace of business is getting faster and faster all the time.

New Realities and Trends related to the field of Organisation Behaviour

Organizations have witnessed a great development from the olden times particularly in
respect of structure, operations and people. There is a considerable change in the cross-
culture environment, influence of MNCs, growth in the technical know-how and quality
management which has provided different environment in the modern organizations. Some of
the important trends observed are mentioned below:

 Globalization
 Emerging employment relationships
 changing workforce
 Knowledge Management
 Information technology and OB
Globalization
Organisation in recent days has changed the style of working and tries to spread worldwide.
Trapping new market place, new technology or reducing cost through specialization or cheap
labour are few of the different reasons that motivates organizations to become global
Moreover the way companies integrate their business practices with other countries has also
changed. Instead of controlling the whole supply chain countries outsource some part of it to
gain advantage of specialization.

Thomas Friedman highlights this phenomenon in his book “The world is flat” There are
several types of organizational changes that has occurred to help business adopt to
globalization, as the old principles no longer work in the age of globalization Strategic
changes, technological change, change in organizational cultural including organizational
structural change and a redesign of work tasks are some of the important one.
In line with these changes, there is strong expectation of employee to improve their
knowledge and become an integral part of successful business formula in order to respond to
the challenges brought by the global economy. In other words it leads to formation of a
learning organisation, which is characterized by creating, gaining and transferring the
knowledge, and thus constantly modifying the organizational behavior.

Emerging employment relationship

Changing trends in organisations in recent years have made it utmost important to consider
some of the emerging employee relations issues which can affect employers in the coming
decade. Understanding these issues will help management to better plan and respond to
changes in the workplace. Employer employee relationship is also showing change in the
modern era. Employers are no more autocrats and participative style of leadership is
welcomed.

Flexible working hours and increased authority motivates employees to perform to their best.
Management now welcomes upward communication and participation of lower level
employees in the decision making process.

Changing workforce
The demographic of the workforce has changed in the recent years.. This is due to a number
of factors such as an aging population, labour shortages and immigration. Another significant
factor that has changed the workforce is the changes in the attitudes of workers. Employers
need to adapt their recruitment, training and management processes to adapt to changing
workforce.

An example of this is that where employers may have previously looked to younger people as
a source of recruits, they may now have to broaden their view as there are currently a large
number of older people either currently employed or seeking employment. These people may
need extra training to bring their skills up to date.

New parents now want to work closer to home or from home, employers may find that they
need to make this a possible option in order to retain or find new staff. Allowing people to
work from home will also make the employer and job more attractive to a wider range of
people.

Recent days is also witnessing a shortage of skilled labour in many sectors. Hence employers
may have to take on less skilled workers initially and develop them, rather than simply hiring
experienced people. Hiring employees from overseas also serves the purpose.

Knowledge Management
Knowledge management is a structured activity that improves an organization’s capacity to
acquire, share, and utilize knowledge for its survival and success. Knowledge management is
 around us from a very long period of time in one form or the other. The decisions we make
and the action we take both are enabled by knowledge of some type. Hence to improve
quality of these actions and decisions it is important to understand the process of knowledge
management.

Studies in knowledge management has proved an inseparable relationship between

knowledge management and organizational culture (Davenport and Prusak,2000; Von Krogh,
2000; Nonaka and Takeuchi, 1995) Research has also proved that organizational culture is a
major barrier to leveraging intellectual assets. They focus on four ways in which culture
influences organizational behaviours central to knowledge creation, sharing, and use.

The first is the shared assumptions about what knowledge is and which knowledge is worth
managing. Second is the relationship between individual and organizational knowledge.
Third is the context for social interaction that determines how knowledge will be used in
particular situations. Fourth is the processes by which knowledge is created, legitimated, and
distributed in organizations.

There are three basic elements of knowledge management

1. Knowledge acquisition: It is method of learning through experiences, sensation or

perception.
2. Knowledge sharing: Knowledge sharing is a process through which knowledge is shared
among family, friends or any community.
3. Knowledge dissemination: It is conceptual and instrumental use of new knowledge.
Increased awareness and ability to make informed choice among available alternatives are the
outcomes of knowledge dissemination.
4. Knowledge maps: Knowledge maps guide employees to understand what knowledge is
needed to increase their efficiency and productivity and where these knowledge are located.

Information Technology and OB

Technological change and advancement is one of the most salient factors impacting
organizations and employees today. In particular, the prominence of information technology
(IT) has grown many folds in recent years. This innovation in IT has opened new ways for
conducting business that are different from the past. Technology has changed the nature of
work as well as the roles of employees.

Managerial decision making, stress handling, and attitude towards work have changed as an
impact of technology. It is also seen from decades that there is a normal tendency of human
being to resist to changes, making adoption of new technologies a little difficult.

It has become important for the business and management to understand and take these issues
into consideration while introducing or implementing any new technology. Frequent sessions
on change management can help employees understand, use and adopt new technologies
easily.