Organizational Behavior Principles

Designing Adaptive Organizations

• Departmentalization is a key management tool for creating structured, coherent, and functional business setups
• Involves dividing an organization into distinct departments, each with specific functions aligning with company objectives

Traditional Approaches to Departmentalization

• Five approaches exist, each offering unique advantages and disadvantages

Functional Departmentalization

• Departments are based on business functions or areas of expertise, such as production, marketing, finance, and HR in a manufacturing company
• It allows for high specialization while isolation can create communication barriers

Product Departmentalization

• Departments structured around products or services offered
• Apple might organize departments by iPhone, Mac, and Apple Watch
• Allows sharp focus on individual product performance, but may duplicate resources across product lines

Customer Departmentalization

• Division based on customer types served
• Software development companies may have departments for individual, enterprise, and government clients
• Enhances customer service through tailored approaches, but can duplicate efforts across customer groups

Geographic Departmentalization

• Divisions formed based on geographic areas or markets
• Walmart having separate departments for North America, Europe, and Asia
• Helps cater to local needs but may result in operational standard discrepancies across regions

Matrix Departmentalization

• Combines two or more forms of departmentalization, often product and functional
• Employees typically report to more than one manager
• A tech company employee might work under a product manager and an HR manager
• Promotes communication and collaboration but could lead to confusion because of dual reporting

Organizational Authority

• Outlines a company's hierarchical structure, defining command, decision-making, and task execution powers
• Chain of command vertically links every job, establishing reporting relationships and accountability
• Line authority gives managers power to direct subordinates
• Marketing managers can direct the activities of marketing executives
• Staff authority is advisory, providing advice or services without command or enforcement power

Delegation

• Managers delegate authority by assigning responsibility and power to subordinates for task completion
• A project timeline creation could be delegated to a project coordinator
• Centralization involves decision-making power primarily held by upper management
• Apple has strategic decisions made by top management
• Decentralization distributes authority throughout the organization
• Spotify has agile squads where teams can make decisions related to their work

Job Design

• A systematic approach to define tasks, duties, and responsibilities of specific roles.

Specialization

• Commonly used due to economic reasons and ease of learning, for repetitive tasks like assembly lines
• It helps maintain efficiency and lower wage costs but lacks motivation and satisfaction

Job Rotation, Enlargement, and Enrichment

• Strategies to combat specialization limitations

Job Rotation

• Involves periodic employee movement to different tasks to reduce boredom and increase skill set
• A customer service representative handling phone inquiries, live chat, and email responses

Job Enlargement

• Increases the number of tasks in a specific role to make work interesting.
• An administrative assistant's role enlarged to include social media account management

Job Enrichment

• Aims to increase employees' autonomy and responsibility, increasing their role's value
• A software developer given the opportunity to liaise directly with clients

Job Characteristics Model

• A comprehensive approach to make jobs intrinsically motivating, by focusing on 5 core characteristics; skill variety, task identity, task significance, autonomy and feedback
• Impacts three critical psychological states in workers: knowledge of results, responsibility for work outcomes, and meaningfulness of work.

Managing Redesign Elements

• Jobs can be redesigned by combining tasks, forming natural work units, establishing client relationships, adding vertical loading, and opening feedback channels.
• A project manager's role redesigned to have high skill variety, task identity, task significance, autonomy, and feedback

Organizational Processes

• Organizations continually evaluate their internal processes for; efficiency, productivity, and enhanced customer satisfaction

Business Process Reengineering (BPR)

• Turns organizations from vertical to horizontal structures, modifying work processes, decreases interdependance, and increase reciprocal interdependance
• Manufacturing companies making their production more horizontally focused

Empowerment

• Redistributes decision-making authority from managers to frontline employees to create a work environment
• A customer service representative can resolve customer complaints autonomously

External Organizational Processes

• Organizations redesign external processes to enhance efficiency, responsiveness, and competitiveness

Modular Organizations

• Outsource all non-core business activities, focusing on primary competencies
• Tech companies outsourcing customer service, logistics, and HR. It requires trust-based relationships which comes with risks

Virtual Organizations

• Involve networks where multiple entities share skills, costs, capabilities, markets, and customers
• They feature Software development companies, marketing firms, and customer service provider launch new digital product with effective coordination

Motivation

• Combination of forces that initiate, steer, and sustain individuals efforts

Needs

• The core of motvation are peoples lower and higher needs

Motivation & Rewards

• Fueled by extrinsic rewards administered externally (salary, bonuses, promotions) and intrinsic rewards (accomplishment, personal growth)

Equity Theory

• Employee perception of fairness influencing motivation through balanced inputs and outcomes
• Inputs encompass effort, skills, experience, and dedication; outcomes include salary, benefits, recognition, referents are Benchmarks
• Inequity leads to under-reward and over-reward scenarios
• Under award produces frustration and damage to motivations

Expectancy Theory

• Motivation based on expectations, influenced by outcome expectation and value
• Consists of valence (emotional orientations or value), expectancy (belief that effort yields performance), and instrumentality (perceived correlation between performance and outcomes)
• All three elements must be strong

Reinforcement Theory

• Suggests behavior is shaped by its consquences
• Strategies: positive reinforcement giving bonus, negative reinforcement exempting regular overtime, punishment reprimanding poor behaviour, extinction ignoring poor behaviors

Schedules of reinforcement

• Frequency and predictability are either continuous or intermittent
• Continuous involves praising and rewarding any good behaviour
• Intermittent involves some reward, some punishment for good or bad behaviour

Effective Motivation

• Requires understanding employees' unique needs, goals, and expectations

Leadership vs Management

• Leadership drives goal attainment while management is organizing tasks to drive daily output of an organization
• Management is the adherence to established routines whiles leadership inspires new and better behaviours and strategic ideas

Traits of Effective Leaders

• Drive, desire to lead, honesty, self-confidence, emotional stability, cognitive ability, and in-depth business knowledge
• Includes initiating structure, defining work relationships and roles, task scheduling, assigning tasks, and defining steps
• Includes Consideration by building relationships marked by mutual trust, respect, and employee's feelings

Theories of Leadership

• Includes visionaries, architects, bridgers and catalysts

Fiedler's Contingency Theory

• Situation dictates effectiveness with the right balance of leader-member relations, task structure, and position power
• There are two types of behaviors; relationship-oriented and task-oriented, who both need to be well supported

The Path-Goal Theory

• How leaders influence subordinate satisfaction and performance
• Provides employee satisfaction and bolsters performance by clarifying goals and increasing volume of rewards upon goal attainment

Normative Decision Theory

• Helps create leadership models that encourage higher levels of decisions
• Offers AI or AII autocratric behavior, which can make a decision alone, or CI and CII which seeks consultative advice

Visionary Leadership

• Constructing an image of the future that inspires and gives direction
• Made up key components, visionary leadership serves as powerful catalyst for innovation

Charismatic Leaders

• Charismatic leaders are characterised by their dynamic, confident personalities that naturally attract followers. They forge strong bonds with their followers and inspire them to work towards achieving the leader's vision.

Transformational Leaders

• Encourages awareness and acceptance of a group's purpose and mission and stimulates employees to look beyond their needs and self-interests for the benefit of the group.

Perception in ORganizational Communication

• It's the way people interpet and retian information, which is often subjective
• Defensive bias among employees and fundamental attribution error by managers creates gaps and self-serving bias
• These aspects often lead to poor feedback and breakdown

Communication Components

• Sender, receiver, noise, and feedback
• Communication is often formal, downwards of upwards communication, and informal, through the grapevine of gossip
• Should be timely, focused on specific actions, and be solution based

Non verbal Communciation

• Encompases kinesics body language ad paralanguage pitch and volumn

Managing Organizational Communication

• It's an understanding of the sender and recievers, how to implement tools, feedback, hotlines surveys and meetings to ensure alignment and correct feedback

Control Process

• A tool that enhances the organizations operations and ability to achieve goals
• Begins with establishing standards, measuring performance compared against standards, correcting issues to stear the organization on correct path

Control MEthods

• FEedback is for after action reports, concurrent is real time, feed forward is prevention

Types of Control

• Bureaucratic control, organizational policies and hierachial systems, objective, with measurements and outcomes used to grade performance, normative is the establishment of strong core values

Current landscape change

• Focus is shifting away from the standard, to be balanced scorecard, with focus on financial measures, consumer control and learning
• It drives internal operations, and more control

Test your knowledge of organizational behavior concepts, including organizational structure, job design, and reinforcement theory. Explore decentralized structures, improving response times, job satisfaction, and addressing employee behavior through reinforcement contingencies.