Organizational Behavior Overview

Organization Definition

• Organizations are structured entities that utilize resources from the environment to produce outputs, while adhering to formalized procedures and rules.
• From a behavioral perspective, organizations are a collection of rights, obligations, and responsibilities that are dynamically maintained through negotiations and conflict resolution.

Organizational Features

• Organizations frequently utilize hierarchical structures to maintain authority and accountability, promote impartial decision-making and efficiency.
• Organizational routines and business processes represent standardized procedures for handling expected situations.
• The interplay of organizational politics, culture, environments, and structures influences organizational dynamics.

Business Processes and Routines

• Routines, also known as standard operating procedures, are precise sets of rules, procedures, and practices developed for managing common, predictable situations.
• Business processes comprise multiple, linked routines.
• A business firm is essentially a collection of intertwined business processes.

Information Systems and Organizational Impacts

• The implementation of information systems can significantly impact organizational structures, cultures, politics, and work practices.
• Organizations often experience resistance to change when information systems are introduced, as they can influence access to critical information - a key resource.
• Failure to adapt to new systems due to resistance to change is a common reason for project failures.

Key Factors when Planning Systems

• When planning the implementation of new information systems, it's vital to consider the organization's environment, structure, culture, politics, and leadership style.
• Understanding the main interest groups affected by the system and the attitudes of end users is crucial.
• It's essential to analyze the specific tasks, decisions, and business processes that the new system will support.

Information Systems and Competitive Advantage

• Michael Porter's competitive forces model provides a framework for understanding the dynamics between a firm, its competitors, and the industry environment.
• This model identifies five key competitive forces:
  • Traditional competitors
  • New market entrants
  • Substitute products and services
  • Customers
  • Suppliers

Strategies to Address Competitive Forces

• Information technology can facilitate four primary strategies for navigating competitive forces:
  • Low-cost leadership: producing products and services at lower prices than competitors while enhancing quality and service.
  • Product differentiation: introducing innovative products or services that significantly improve customer convenience and experience.
  • Focus on market niche: employing information systems to specialize in a specific market segment.
  • Strengthening customer and supplier intimacy: using information systems to cultivate strong relationships and loyalty with customers and suppliers, ultimately increasing their "switching costs."

Impact of the Internet on Competitive Advantage

• The internet has significantly altered the competitive landscape, leading to both industry transformations and threats for some businesses, such as travel agencies, printed encyclopedias, and newspapers.
• Increased competition: The internet fosters more intense rivalry among market players.
• Universal standards: These standards facilitate the entry of new rivals and market entrants.
• New opportunities: The internet provides avenues for building brands and fostering loyal customer bases.

Business Value Chain Model

• This model views a firm as a series of activities that add value to products or services.
• It highlights where competitive strategies can be most effectively implemented.
  • Primary activities versus support activities
• The model encourages evaluating how information systems can enhance operational efficiency and improve relationships with customers and suppliers, ultimately contributing to the firm's overall value proposition.
• To optimize performance, benchmarking and utilizing best practices from within the industry are valuable practices.

Test your understanding of organizational structure and behavior with this quiz. Explore key concepts like hierarchy, routines, and the dynamics that govern organizations. Perfect for students studying management or organizational behavior.