Organizational Behavior - Managerial Approach (PDF)

Organizational Behavior a managerial approach F I R S T E D I T I ON By Dr/Nada S. Mubariz & Dr/Ahmed F. Elias Lecturer of Business Administration Faculty of Commerce - Beni-Suef University Reviewed by Prof/Alaa E. Abdel Gani Professor of Business Administration Faculty of Commerce - Beni-Suef University 2023 Organizational Behavior a managerial approach F I R S T E D I T I ON By Dr/Nada Shaban Mubariz Dr/Ahmed Farouk Elias Lecturer of Business Administration Faculty of Commerce - Beni-Suef University Reviewed by Prof/Alaa El Dien Abdel Gani Professor of Business Administration Faculty of Commerce - Beni-Suef University 2023 Dedication To Our daughters; Farida & Farah A Table of contents Table of contents Learning Objectives Page Chapter 1: Nature of Organizational Behavior 1-39 1. Meaning of Organizational Behavior 4 2. Influences On Organizational Behavior 16 3. Importance (Need) of Organizational Behavior 19 4. Outcome Variables in Organizational Behavior 22 5. Challenges and Opportunities for Organizational Behavior 25 Chapter 2: Organizational Behavior Development 40-89 6. The Islamic Management Perspective 45 7. The Classical Management Perspective 48 8. The Behavioral Management Perspective 62 9. The Quantitative Management Perspective 73 10. Contemporary Management Perspectives 76 Chapter 3: Perception and Attribution 90-127 1. Meaning of Perception 94 2. Nature of Perception 96 3. Importance of Perception 98 4. Factors That Influence Perception 99 5. Stages of the Perception Process 110 6. Common Perceptual Biases 115 7. Attribution: Perceiving Causes and Motives 120 8. Biases in Attribution 126 B Table of contents Chapter 4: Attitudes 128-158 1. Meaning of Attitudes 131 2. Characteristics of Attitudes 134 3. Components of Attitudes 135 4. Elements of Attitudes 138 5. Types of Attitudes 140 6. Change and Modify Attitudes 143 7. Measure of Attitudes 154 8. Functions of Attitudes 157 Chapter 5: Personality 159-182 1. Meaning of Personality 162 2. Major Determinants of Personality 163 3. The Big Five Personality Model 170 4. Personality Theories 177 Chapter 6: Emotions and Moods 183-214 1. Meaning of Emotions and Moods 187 2. Types of Emotions and Moods 189 3. Emotional Intelligence 191 4. Emotions and Moods in Organizations 198 5. Applications of Emotions and Moods for Managers 206 C Table of contents Chapter 7: Work Group 215-248 1. Work Group Versus Team 219 2. Meaning of Work Group 221 3. Factors Affecting Group Behavior 223 4. Working Group Structure 227 5. Types of Groups 231 6. Reasons for Formation of Groups or Teams 236 7. Stages of Group Development 238 8. Characteristics of an Effective Work Group 243 9. Group Decision-Making 244 Chapter 8: Communication 249-281 1. Meaning of Communication 252 2. Process of Communication 257 3. Types of Communication 262 4. Barriers of Communication Process 270 5. Methods of Overcoming Barriers of Communication 274 6. Communication issues in Today’s Organizations 275 Chapter 9: Leading 282-339 1. Meaning of Leading 286 2. Sources of Power 291 3. Types of Leaders 294 4. Theories of Leadership 296 5. Principles of Direction 306 6. Ethical Leadership 307 D Table of contents Chapter 10: Motivation 340-369 1. Meaning of Motivation 344 2. Important of Motivation 346 3. Factors Affecting on Motivation 352 4. Types of Motivation 354 5. Maslow’s Need Hierarchy 358 Chapter 11: Employee Voice 370-411 1. Conceptualization of Employee voice 375 2. Importance of Employee voice 383 3. Types of Employee voice 386 4. The practice of voice in the workplace 391 5. Predicting of Employee voice 394 6. Mechanisms of Employee voice 398 7. Outcomes of Employee Voice 402 8. Challenges and Limitations of Employee voice 405 Chapter 12: Organizational Culture 412-452 1. Meaning of Organizational Culture 415 2. Importance of Organizational Culture 422 3. Components of Organization’s Culture 426 4. Types of Organization’s Culture 428 5. Valued Based Management 438 6. The Meaning of Organizational Socialization 441 Reference 453-455 E Chapter 1………..……… Nature of Organizational Behavior Chapter 1 Nature of Organizational Behavior 1 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Chapter 1 The Nature of Organizational Behavior Learning Objective After studying this chapter, you should be able to: 1. Meaning of Organizational Behavior 2. Influences On Organizational Behavior 3. Importance (Need) of Organizational Behavior 4. Outcome Variables in Organizational Behavior 5. Challenges and Opportunities for Organizational Behavior 2 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Introduction The scope for the examination of behavior in organizations is very extensive. There is a diversity of interrelated factors that affect the behavior and performance of individuals as members of a work organization. It is essential to recognize the role of management as an integrating activity and the increasingly global business environment. People and organizations require each other. The manager requires to understand the main effects on behavior in work organizations and the nature of the individual– organization relationship. Why do individuals behave the way they do? What causes various people to react differently to the same situation? Why are some organizations more successful than others, even though they appear to be managed in the same manner? All these questions – and more – are the substance of what organizational behavior is all about. 3 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Learning Objective 1: Meaning of Organizational Behavior Behavior has attracted the interest of humans since ancient times, and this was part of man's attempt to understand the truth about himself and his existence. The progress of natural sciences has led to the confirmation of the fact that if man wants to live, he must understand other people and know how to deal with them. We will now review the types of individual behavior: First: Individual Behavior Behavior can be defined as “a series of choices that an individual makes from among possible responses when the individual moves from one situation to another.” Behavior, according to the WEBSTER dictionary, is the way in which an individual behaves, especially during its response to a stimulus. Which means, by behavior we mean all aspects of mental, motor, emotional, and social activity carried out by the individual. It is also a continuous activity carried out by the individual in order 4 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior to conform and adapt to his environment, satisfy his needs, and solve his problems. Human behavior takes various forms, including the following: 1. Mental behavior: This is the behavior in which the individual uses his intelligence to confront the various problems that he encounters in his life. 2. Motor behavior: It is every manual skill that an individual learns, and this behavior usually requires a degree of mental behavior. 3. Emotional behavior: It is the behavior resulting from an individual’s response to a specific stimulus. Among these emotions are joy, sadness, crying, depression, anger, optimism, and pessimism. 4. Linguistic behavior: This behavior is represented in the communication processes that take place between individuals with each other. 5. Social behavior: This is the behavior that an individual exhibits while dealing with various groups 5 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior 6. Compatible behavior: This is the behavior that comes from the individual to adapt to the frustrating situations that he encounters in his daily life. This behavior consists of searching for alternative goals or giving up some goals which could not be satisfied by the individual or being satisfied with the partial satisfaction of these motivations. Second: Organizational Behavior There is a close relationship among organizational behavior and management theory and practice. Some writers seem to propose that organizational behavior and management are equal, but this is something of an over- simplification since there are several broader facets to management. Organizational behavior does not include the whole of management; it is more accurately described in the narrower interpretation of offering a behavioral approach to management. Organizational behavior (often abbreviated OB) is a field of study that investigates the effect individuals, groups, and structure have on behavior within organizations, for the purpose of applying such knowledge toward 6 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior developing an organization’s effectiveness. That’s a mouthful, so let’s break it down. Organizational behavior is a field of study, meaning that it is a different area of expertise with a common body of knowledge. It studies 3 determinants of behavior in organizations: individuals, groups, and structure. In addition, OB applies the knowledge gained about individuals, groups, and the impact of structure on behavior in order to make organizations work more effectively. Organizational behavior (OB)1 is defined as the systematic study and application of knowledge about how individuals and groups act within the organizations in which they work. definitions are important because they tell us what something is and what it is not. For instance, we will not be addressing childhood development in this course, however we may draw on research about twins raised apart to understand whether job attitudes are affected by genetics. 7 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Characteristics of Human Behavior 1. Behavior is purposeful: - meaning that every behavior issued by a person must be directed to a specific goal, and this goal may be to achieve a specific advantage or eliminate harm, and these goals may be known to the person or unknown. 2 Behavior is caused: the behavior must have a cause, and the cause is an interaction between the mover and the influencer and the individual’s orientation and interpretation of these drives and influences. These causes are divided into physical; material causes and social: moral causes. These causes may be clearly known to humans, or they may be unknown and unclear. 3. Behavior has a motive: The motive here is the real force that drives this behavior. Where a person has unsatisfied motives or desires, the person adopts specific behaviors to satisfy them. 8 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Elements of Human Behavior 1. Goal: Every behavior has a goal that the individual seeks to achieve, and this goal varies in terms of its importance or value to the individual. Entering medical school is considered a big and important goal for a high school student, and just arriving at high school every morning is also considered a goal, but less valuable. Human actions are usually directed towards certain goals. Some of these goals may be as close as preparing lunch for a housewife one day. The goals may be far-reaching, such as the distant professional goals of a university student. An individual often has multiple goals while he seeks to achieve. 2. Readiness: The individual can respond in many different ways. individual usually fails to reach his goal if the situation requires a response that he cannot do or is not capable of doing it. The individual may be so weak that he is unable to make a certain response, his level of knowledge and information may be substandard, and he may have limited mental 9 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior capacity. An individual's failure to achieve his goals may be due to his being unprepared and ill-equipped to make appropriate responses. A young child, if he faces situations that frustrate and annoy him, has no choice but to scream and cry, but as he grows older, his ability and experience in confronting situations increases. An individual does not engage in a certain behavior unless he is capable of it and prepared for it. 3. Situation: The situation provides the individual with different alternatives that require him to choose from among these alternatives. These situations give the individual the opportunity to satisfy his needs and meet his demands. The situation often involves a specific problem that requires a solution from the individual. The individual may be aware of the reality of this problem and its dimensions, or he may be unaware of it. Even for the routine situations that the individual faces in his life, the situation usually provides him with several alternatives that give him the opportunity to respond multiple times. When an individual is faced with a specific situation, such as trying to cross the street on his feet, he is usually 10 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior faced with several alternatives to the method and path he follows in crossing this street, and he must choose well among these alternatives. While it is easier if the individual is used to cross this street in a certain way, in this case the individual does not waste effort or time in choosing when he follows the usual behavior. 4. Interpretation: The individual interprets the situation before he takes it or acts in a certain way. He must decide possible actions and attempt to predict possible outcomes based on an appreciation and understanding of the present situation considering previous experience, and by using reasoning and logic. 5. Response: The individual responds, acts, and behaves in the manner that he believes will lead him to the greatest degree of satisfaction. After estimating the expected results of various actions, the individual tries to use the actions that give him the greatest amount of reward and satisfaction and the least amount of loss or cost. for example, a person who wants to travel with his family to a certain city, the 11 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior person tries to choose the path that will achieve his goals, comfort, financial gain and pleasure while traveling, with the least amount of hassle, risks and problems. 6. Consequences: The outcomes of an individual’s behavior and actions may achieve the goal and satisfy the individual’s demands and needs. Here, the individual’s interpretations of the situation agree with the outcomes he obtained. These outcomes may contradict his interpretations, disappoint his hopes, and do not achieve his goals. In this case, the individual reinterprets the situation and acts with new responses. He may decide that the goal cannot be reached or is not worth the effort of reaching it. The previous situation may lead to the individual feeling upset and psychologically stressed, and then frustrated and canceling the trip. 12 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Model of Human Behavior This model consists of the following elements: 1. Input: It is represented by all the external stimuli surrounding the person, as well as the stimuli related to factors in the individual’s personality, which the person receives through the process of feeling. 2. Central Operation of Information: This stage consists of storing the received information in memory and the process of perception, thinking and decision-making... This stage is considered very important as the nature of the resulting action or response depends on it. 3. Outputs: the information that has been received and stored in memory and then been operated resulting in specific decisions that clarify the nature of the required action and response. 4. Information Retrieval: - At this stage, information about the individual’s response is returned to the input process, and this then entails a change in the output “responses” that will occur later. 13 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Determinants of Human Behavior There are certain factors that are considered to determine an individual’s behavior, some of which are the following: 1. The great capabilities of the individual: An individual who has appropriate physical strength can do some work that another individual with weak strength cannot do. 2. Mental abilities: Mental abilities here can be divided into two types: General mental abilities or what is called intelligence. This ability varies from one person to another and therefore affects the extent of the individual’s success in tasks that expose him to special mental abilities, including linguistic ability, arithmetic, manual, mechanical, and technical abilities...etc. Some of these abilities are required to be present in the individual at a certain level to succeed in work. 3. Personality: There is no doubt that personality is what determines, to a large extent, the form of behavior and actions issued by the individual, and our understanding of the individual’s personality makes us able to predict 14 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior what this individual’s actions will be like if he faces a specific situation or encounters a specific problem. 4. Culture: Culture also has a clear impact on the behavior of individuals because the individual grows up and finds himself, voluntarily or unwillingly, following the culture that prevails in the group. He eats the way people eat and marries according to the prevailing custom and traditions... and from here we can realize the great influence of culture on the behavior of individuals who live within it. 5. The referral group: the group to which the individual belongs - Here it is noted that the impact of groups on the behavior of individuals varies depending on the importance of the group to the individual, the time the individual spends in the group, and the extent of this group’s ability to satisfy the individual’s financial, social, and psychological needs. 6. The social class: Here it is noted that the social class leaves its mark on the behavior of its members and imposes some restrictions on their actions. 15 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Learning Objective 2: Influences On Behavior The variables outlined provide parameters within which several interrelated dimensions could be identified – the individual, the group, the organization and the environment – which collectively affect behavior in work organizations. 1. The Individual Organizations are made up of their individual members. The individual is a central feature of organizational behavior, whether acting in isolation or as part of a group, in response to expectations of the organization, or as a result of the effects of the external environment. Where the needs of the individual and the demands of the organization are incompatible, this could result in frustration and conflict. It is the task of management to integrate the individual and the organization and to offer a working environment that allows the satisfaction of individual needs and the accomplishment of organizational goals. 16 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior 2. The Group Groups exist in all organizations and are critical to their work and performance. The organization includes groups of people and almost everyone in an organization would be a member of one or more groups. Informal groups result from the social needs of people within the organization. Individuals in groups affect each other in various ways and groups might develop their own hierarchies and leaders. Group pressures could have a major affect over the behavior and performance of individual members. An understanding of group structure and behavior matches a knowledge of individual behavior and adds a additional dimension to organizational behavior. 3. The Organization Individuals and groups interact within the structure of the formal organization. Structure is created by management to establish relationships among individuals and groups, to deliver order and systems and to direct the efforts of the organization into goal-seeking activities. It is through the formal structure that individuals carry out their 17 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior organizational activities in order to accomplish aims and objectives. Behavior is influenced by patterns of organization structure, technology, styles of leadership and systems of management over which organizational processes are planned, directed and controlled. The focus of attention, therefore, is on the effect of organization structure and design, and patterns of management, on the behavior of people within the organization. McPhee refers to the growth in the nature and importance of organizational structures and their essence, and for greater emphasis on business-to-business (B2B) depth or group interviewing as part of an insight into business and organizational behavior. 4. The Environment The organization functions as part of the broader external environment of which it is a part. The environment influences the organization through, for instance, technological and scientific development, economic activity, social and cultural effects and governmental actions. The impacts of the operation of the organization within its environment are reflected in terms of the 18 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior management of opportunities and risks and the successful accomplishment of its goals and objectives. The increasing rate of change in environmental factors has highlighted the necessity to study the total organization and the processes by which the organization tries to adapt to the external demands placed upon it. Increasing globalization means that organizations should respond to different market demands and local requirements. ‘In globalization, strategy and organization are inextricably twined. Globalization effects on organizational behavior and has placed greater emphasis on processes within organizations rather than functions of the organization. Learning Objective 3: Importance (Need) of Organizational Behavior Although organizational behavior is not a function performed daily like accounting, marketing, or finance, it involves almost every function at the organization level, and at the level of all disciplines. Every individual who plans to work in any organization, whether large or 19 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior small, public or private, must study and understand organizational behavior in order to deal with others. The importance of organizational behavior for modern organizations has become obvious for many reasons, including: 1- The importance of human resources attracted the interest to study and understand the behavior of individuals, as it has an impact on the effectiveness of the organization. 2- Changing the perception of human resources, drawing attention to the need to pay attention to the growth and development of these resources. This can be achieved by investing in them to increase their efficiency and improve their skills. Therefore, a correct understanding of the behavior of individuals enables the organization to deal with individuals in a correct manner. 3- The complexity of human nature and the existence of individual differences that characterize this behavior, which required the organization to understand and analyze these differences to arrive at methods that fit these differences. 20 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Need for Organizational Behavior 1. Explain individual and group behavior: We follow the explanation objective when we want to know why individuals or groups behave the way they do. For instance, if the turnover rate in an organization is very high, we want to know the reason, so as to action could be taken to correct the situation in the future. 2. Predict specific behavioral response to change: Prediction seeks to specify what outcomes would result from a given action. Having a sound knowledge of OB would aid the manager to predict specific behavioral responses to change. In this way, the manager could expect which approaches wolud generate the least degree of employee resistance and use that information in making decisions. 3. Control Behavior: The knowledge of OB could be used by managers to control behavior. Managers often see the control objective as the most valuable contribution that OB makes toward their effectiveness on the job. 21 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Learning Objective 4: Outcome Variables in Organizational Behavior Since OB is an applied science, the outcome variables studied are typically variables which leaders are interested in improving. There are 4 broad groups of outcome variables studied: performance, work-related attitudes, motivation, and employee withdrawal. Performance Productivity (or job performance) is one of the most essential outcomes in OB. Performance could be actual performance as collected in organizational records (for ex: the number of forms correctly processed in an insurance company) or it might be rated by supervisors or peers (for ex: the supervisor rates the follower’s work quality on a scale from 1 to 7, as 1 being poor and 7 being outstanding). Organizational citizenship behavior (OCB) is the worker’s willingness to go above and beyond what is needed in their job descriptions to assist others at work. While OCB is a critical outcome variable, 22 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior it has also been shown that OCB predicts individual and organizational outcomes also. Work-Related Attitudes The measurement of work-related attitudes is an essential aspect of OB research and job satisfaction has long been studied as an outcome variable. For instance: there is a measure of job satisfaction dating back to 1935 that is still employed in organizational studies today "the Hoppock Job Satisfaction". Another existing outcome variable that is gaining research attention is employee engagement. Employee engagement could be defined “as a relatively enduring state of mind referring to the immediate investment of personal energies in the experience or performance of work”. Motivation Classic views on motivation describe both extrinsic and intrinsic motivation as being equally essential. Extrinsic motivation is based on the rewards from the company’s compensation system, for example pay and bonuses. Intrinsic motivation, in contrast, is related to the value of 23 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior the work itself. As with attitudes, motivation has been studied as an outcome variable, however also as an independent variable that predicts productivity. Prosocial motivation is a new concept of motivation that evaluates the degree to which employees behave in a way that benefits society. Employee Withdrawal An employee leaving the organization is costly in terms of the money and time spent to recruit, hire, and train replacements. There is much research in OB on the reasons why personnel think about quitting (turnover intentions) and actual turnover. The availability of outside employment opportunities is a factor, although thoughts of quitting might be related to other outcomes such as lower job satisfaction and engagement. And if the economy and the job market improve, workers might eventually leave for other opportunities. Another costly form of worker withdrawal is absenteeism, as workers may not come to work when they are dissatisfied and there are little alternative jobs available. 24 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Learning Objective 5: Challenges and Opportunities for OB Understanding organizational behavior has never been more significant for managers. Take a quick look at the dramatic changes in companies. The typical worker is getting older; the workforce is becoming increasingly varied; corporate downsizing and the heavy use of temporary workers are severing the bonds of loyalty which tied many workers to their employers; and global competition needs employees to become more flexible and cope with rapid change. As a result of these changes and others such as the increasing use of technology, employment options have adapted to include new opportunities for employees. In short, today’s challenges bring opportunities for managers to use OB concepts. In the following section, we will review some of the most essential issues confronting managers for which OB offers solutions—or at least meaningful insights toward solutions. 25 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Responding to Economic Pressures When the U.S. economy plunged into a deep and long recession in 2008, virtually all other large economies around the world followed suit. Downsizings and job losses were widespread, and those who survived the ax were frequently asked to accept pay cuts. When times are bad as they were during the recession, managers are on the front lines with employees who should be fired, who are asked to make do with less, and who worry about their futures. The difference among good and bad management could be the difference among profit and loss or, ultimately, among survival and failure. Managing employees well when times are good could be just as hard, if not harder, than when times are bad. However, the OB approaches sometimes differ. In good times, understanding how to reward, satisfy, and keep employees is at a premium. In bad times, issues like stress, decision making, and coping come to the fore. 26 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Responding to Globalization: Organizations are no longer controlled by national borders. Burger King is owned by a British company, and McDonald’s sells hamburgers in more than 100 companies in 6 continents. ExxonMobil, a so-called U.S. company, reported that less than six percent of its 2011 earnings were from gas and natural products sales in the U.S. New employees at Finland-based phone maker Nokia are increasingly being recruited from India, China, and other developing. And all key automobile makers now manufacture cars outside their borders; Honda builds cars in Ohio, Ford in Brazil, Volkswagen in Mexico, and both Mercedes and BMW in South Africa. Organizations are no longer constrained by national borders; the world has become a global village. 1. Increased foreign assignment: Transferred to your employer's operating division in another country. you'll have to manage personnel, aspiration from workers, and attitudes from those you are used to back home. 27 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior 2. Working with diverse people: Working with bosses, peers and other employees who were born and raised in various culture, to work effectively with them you've to understand how the culture, geographic and religion have shaped them. 3. Coping with anti-capitalism backlash: "soak the rich" means fine must be charged with respect to income you earn. Managers at global organizations have come to understand that economic values are not universally transferable, necessity to change by managers to reflect economic values in those countries they're working. 4. Overseeing movement of jobs to countries with low-cost labor: In a global economy, jobs tend to flow to places where lower cost offer business companies a comparative advantage. 5. Managing people during the war on terror: An understanding of OB topics like emotions, motivation, communication, and leadership could assist managers to deal more effectively with their employees' fear about terrorism. 28 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Managing Workforce Diversity One of the most essential challenges for companies is workforce diversity, the concept that companies are becoming more mixed in terms of gender, age, race, ethnicity, sexual orientation, and inclusion of other various groups. Whereas globalization focuses on differences between people from various countries, workforce diversity addresses differences between people within given countries. Workforce diversity acknowledges a workforce of women and men, many racial and ethnic groups, individuals with a diversity of physical or psychological abilities, and individuals who differ in age and sexual orientation. Managing diversity is a global concern. Nevertheless, we have more to say about workforce diversity later, so we have to say here that diversity presents great opportunities and has challenging questions for managers and employees in all countries. How could we leverage differences within groups for competitive advantage? Should we treat all employees similarly? Should we recognize individual and cultural 29 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior differences? How could we foster cultural awareness in employees without ending into stereotyped political correctness? What are the legal needs in each country? Does diversity even matter? Improving Customer Service Service employees include technical support representatives, fast-food counter workers, salesclerks, nurses, automobile repair technicians, consultants, financial planners, and flight attendants. The shared traits of their jobs are substantial interaction with an organization’s customers. OB could assist managers increase the success of these interactions by showing how employee attitudes and behavior impact customer satisfaction. Many an organization has failed because its employees failed to please customers. OB could provide considerable guidance in assisting managers create customer-friendly cultures that employees are friendly and courteous, accessible, knowledgeable, prompt in responding to customer requirements, and willing to do what’s essential to please the customer. 30 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Improving People Skills We’ll present relevant concepts and theories that could assist you in explaining and predict the behavior of people at work. You’ll also gain insights into certain individuals’ skills you could use on the job. For example, you’ll learn ways to design motivating jobs, techniques for developing your management skills, and skills to create more effective teams. Working in Networked Organizations Networked organizations permit individuals to communicate and work together even though they might be thousands of miles apart. Independent contractors could telecommute through computer to workplaces around the globe and change employers as the demand for their services changes. Software programmers, graphic designers, systems analysts, technical writers, photo researchers, book and media editors, and medical transcribers are just a few instances of individuals who could work from home or other nonoffice locations. 31 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior The manager’s job is different in a networked company. Motivating and leading individuals and making collaborative decisions online need different techniques than when individuals are physically present in a single location. As more people do their jobs by linking to others through networks, managers should develop new skills. OB could provide valuable insights to assist hone those skills. Enhancing Employee Well-Being at Work The typical employee in the 1960s or 1970s showed up at a certain workplace Monday through Friday and worked for clearly defined 8- or 9-hour chunks of time. That’s no longer true for a large segment of today’s workforce as even the definition of the workplace has been expanded to contain anywhere a laptop or smartphone could go. Even if workers work at home or from half a continent away, managers require to consider their well-being at work. One of the biggest challenges to keeping employee well- being is that companies are asking employees to put in longer hours, either in the office or online. Employees 32 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior are increasingly complaining which the line among work and nonwork time has become blurred, creating personal conflicts and stress. Second, employee well-being is challenged by heavy outside commitments. Millions of single-parent households and employees with dependent parents are significantly challenged in balancing work and family responsibilities, for example. Creating a Positive Work Environment A real growth area in OB research is positive organizational scholarship (also called positive organizational behavior), that studies how companies improve human strengths, foster vitality and resilience, and unlock potential. Researchers in this area say too much of OB research and management practice has been targeted to identifying what’s wrong with companies and their individuals. In response, they attempt to study what’s good about them. Some main independent variables in positive OB research are engagement, hope, optimism, and resilience in the face of strain. Positive organizational academics have studied a concept called “reflected best self ”—asking workers to think 33 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior about when they were at their “personal best” in order to realize how to utilize their strengths. The idea is that we all have things that we are unusually good, yet we frequently focus on addressing our limitations and seldom think about how to utilize our strengths. Improving Ethical Behavior In an organizational world characterized by cutbacks, expectations of increasing productivity, and hard competition, it’s not surprising several employees feel pressured to cut corners, break rules, and engage in other questionable practices. Increasingly employees face ethical dilemmas and ethical choices, that they are required to identify right and wrong conduct. Would they “blow the whistle” if they uncover illegal activities in their organization? Do they follow orders that they don’t personally agree to? Do they “play politics” to advance their career? What establishes ethical behavior has never been clearly defined and, in recent years, the line differentiating right from wrong has blurred. Employees see people all 34 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior around them engaging in unethical practices—elected officials pad expense accounts or take bribes; corporate executives increase profits so they could cash in lucrative stock options; and university administrators look the other way when winning coaches encourage scholarship athletes to take easy courses. When caught, these people give excuses such as “Everyone does it” or “You have to grab every advantage nowadays.” Specifying the ethically correct way to behave is especially difficult in a global economy as various cultures have various perspectives on specific ethical issues. Fair treatment of employees in an economic downturn differs considerably across cultures, for example. As we’ll see, perceptions of religious, ethnic, and gender diversity vary across countries. Is it any wonder employees are expressing increasing uncertainty about what is appropriate ethical behavior in their companies? Stimulating Innovation and Change Today's successful organizations should foster innovation and be proficient in the art of change; or else, 35 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior they would become candidates for extinction in the due course of time and vanish from their field of business. Victory would go to those companies that keep flexibility, continually improve their quality, and beat the competition to the marketplace with a constant stream of innovative products and services. For instance, Compaq succeeded by creating more powerful personal computers for the same or less money than IBNM or Apple, and by putting their products to market quicker than the bigger competitors. Amazon.com is putting a lot of independent bookstores out of business as it proves you could successfully sell books from an Internet website. Some of the basic functions of business are being displaced as the advent of a new systems and procedures. For instance, books are being sold only through the internet. Internet selling a company’s employees could be the impetus for innovation and change; otherwise, they can be a key hindrance. The challenge for managers is to stimulate employee creativity and tolerance for change. 36 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior Victory would go the company the maintain their flexibility, continually develop their quality and beat their competition in marketplace. An organization's employees could be main block in change, the challenge to the manager to stimulate their creativity and tolerance for change. Emergence of E-Organization E-commerce refers to the business operations involving electronic mode of transactions. It includes presenting products on websites and filling order. Most articles and media attention given to using the Internet in business are directed to on-line shopping. In this process, the marketing and selling of goods and services are being carried out over the Internet. In ecommerce, the following activities are being taken place quite frequently – the marvelous numbers of people who are shopping on the Internet, business houses are setting up websites where they could sell goods, conducting the following transactions such as getting paid and fulfilling orders. It is a dramatic change in the way an organization relates to its consumers. At present e-commerce is 37 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior exploding. Globally, e-commerce spending was increasing at a great rate from US$ 111 billion in 1999 to US$ 1.3 trillion by 2003. E-business: It refers to the full breadth of activities included in a successful Internet-based organization. As such, e-commerce is a subset of e-business. E-business contains developing strategies for running Internet-based organizations, creating integrated supply chains, collaborating with partners to electronically coordinate design and production, identifying a various kind of leader to run a 'virtual' business, finding skilled people to build and operate intranets and websites, and running the back room or the administrative side. E-business involves the creation of new markets and consumers; however, it's also concerned with the optimum ways to combine Computers, the Web and Application Software. A sizable number of multinational organizations are selling goods and services via the Internet. Growth rate of e-business: The application of Internet operations initially covers a small part of the business. At this point, their e-commerce operations are secondary to their traditional business. An increasingly popular application 38 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 1………..……… Nature of Organizational Behavior of e-business is simply using the Internet to better manage a constant business. Later, there are millions of companies which are now selling anything over the Internet, however they are using e-business applications to improve communications with internal and external stakeholders and to better perform traditional business functions. Some organizations are putting maximum effort into improving its internal efficiency and providing support to its wide-reaching dealer network and to on- line sellers by creating a shared and integrated network. E-organizations: This embraces e-commerce and e- business. State and central governments, municipal corporations are using the Internet for extending all the public utility services more efficiently through internet. Implications for Managers: The employees should acquire skills, knowledge, attitudes in learning new technology, overcoming any resistance. 39 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Chapter 2 Organizational Behavior Development 40 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Chapter 2 Organizational Behavior Development Learning Objective After studying this chapter, you should be able to: Learning Objective 1: The Islamic Management Perspective Learning Objective 2: The Classical Management Perspective Learning Objective 3: The Behavioral Management Perspective Learning Objective 4: The Quantitative Management Perspective Learning Objective 5: Contemporary Management Perspectives 41 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Introduction Administrative thought has gone through many developments, at the beginning of the 20th century, with the emergence of the industrial revolution and the transformation of society in developed countries into an industrial society. With the technological development, the large size of organizations, the expansion of the use of the principle of specialization and the increasing growth of the role of trade unions, there has become an urgent need to pay attention to management science and develop scientific theories for it. In general, approaches of administrative thought development into 4 main approaches. It is worth noting that these approaches are complementary to each other and not contradictory to each other. Each school focused on an aspect of the practice of the administrative process. All these approaches were concerned with answering a major question, which is, how to reach the goals of the organization in a more effective and efficient way? The practice of management could be traced back thousands of years. The Egyptians used the management functions of planning, organizing, and controlling when they constructed the pyramids. 42 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Organizational Behavior Development Productive organizations began to attract large numbers of individuals at the end of the nineteenth century with the beginning of the Industrial Revolution. The importance of relationships between superiors and subordinates and their impact on the organization’s performance of its work and thus on the behavior of employees became apparent at that time. Most organizations that preceded the Industrial Revolution were military in nature, where the authority of the manager or owner was considered absolute. In such circumstances, leaders had no problem dealing with the behavioral aspect. There are many attempts by many researchers, thinkers, and writers throughout history to study and understand the behavior of individuals and groups within organizations and their impact on productivity. To study any aspect of social organizations, reference must be made to the contributions of some theorists who have left a fundamental impact in directing social science theories in the past decades. 43 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Hill and Egan believe that one of the prevailing ideas in the field of social sciences over the past century is that there is an unequal relationship between owners on the one hand and workers. Individuals in productive organizations are exposed to "Alienation" increasing isolation, in addition to “Depersonalization” the lack of personality, even though these individuals possess natural abilities and talents. Workers in such circumstances do not perform their work with satisfaction and contentment to satisfy their natural needs for production, but rather view work as a burden that must be eliminated whenever the opportunity arises. They work for the purpose of earning their daily bread or because they are forced to work. Their work is not an end, but rather a means to achieve a goal. 44 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Learning Objective 1: The Islamic Management Perspective First: The Islamic Management Perspective The Islamic theory has introduced an important and influential social dimension in the administrative behavior within the organization, which is the ethical dimension. There is no business management in Islam without morals, just as there is no Islamic society without morals. Islam came to organize people’s lives in all its different dimensions and fields, so it put clear foundations and rules for organizing the relations between people and their Creator, and between each other in one society, and multiple societies. Islam encourage people to make the best use of the resources available on the earth in order to satisfy their needs and desires, and to achieve happiness and maintain their existence. In the field of business organizations, Islam put principles for the performance of its activities, and put rules for the performance of 45 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development manager's activities and encourages dealing with people with high morals, without deception and fraud. Islam also put rules for performing various administrative functions such as: planning, organizing, and controlling to achieve efficiency and effectiveness. Accordingly, the theory of business administration in Islam is characterized by several characteristics, the most important of which are: 1. It is related to the social view of the Islamic community, and it is linked to the ethics and values of the Islamic community (social-ethical variable). 2. It focuses attention on the economic variable and the material motivator and works to satisfy the individual's physiological needs (economic variable). 3. It is concerned with the “Shura” concept in business management, as an essential element. 4. It is concerned with human and spiritual factors, respects man as a human being, and involves him in the administrative process, each according to his 46 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development mental abilities, capabilities and psychological preparations (human variable). 5. It is concerned with system and defining responsibilities, and respects official authority and official organization, respects the organizational structure (variable of behavior and order). Business management in Islam differs from any business administration anywhere else because business management in Islamic thought follows number of principles that guide it: 1. The First Principle: is that it works according to legal principles 2. The Second Principle: it works according to the ethics of faith. 3. The Third Principle: it always keeps up to date with modernity in its sophistication. 4. The Fourth Principle: It is based on good human elements. 47 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Learning Objective 2: The Classical Management Perspective Second: The Classical Management Perspective The classical management perspective, that includes three different viewpoints: scientific management, administrative management, and Bureaucratic management: 1. Scientific Management: 48 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Productivity appeared as a serious business problem, during the early years of the 20th century. Business was expanding, and capital was readily available, but labor was in short supply. Hence, managers start to search for ways to use existing labor more efficiently. In response to this need, experts began to focus on ways to develop the performance of people workers. Their work led to the development of scientific management. Some of the earliest advocates of scientific management included Frederick W. Taylor (The Father of Scientific Management) (1856–1915), Frank Gilbreth (1868– 1924), and Lillian Gilbreth (1878–1972). Frederick Taylor's studies of time and movement are considered one of the most important contributions to the field of scientific management. Taylor noticed that all factory workers perform the work in different ways from each other and that each of them does not perform their work as it should. Therefore, it is possible to determine the best way to do the work which is “One best way” by determining the movement and time required to perform each task. The scientific study of the movements to perform the work, in addition to the study of time, 49 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development enables the identification of a more rational, objective, effective, and economical method for carrying out the work based on this direction. Only material incentives can be used to direct the behavior of the individual within the organization. Taylor’s observed what he called soldiering—employees deliberately working at a pace slower than their capabilities. Taylor studied and timed each element of job. He determined what each worker should be producing, and then he designed the most efficient manner of doing every part of the overall task. Next, he implemented a piecework pay system. Rather than paying all employees the same wage, he began increasing the pay of each worker who met and exceeded the target level of output set for his or her job. Scientific Management consists of a specific philosophy of: A. Scientific selection and training of right employees for the right job. 50 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development B. Providing adequate working conditions, such as lighting, ventilation, drinking water, canteen, sanitation, rest rooms, rest periods. C. Providing a system of monetary incentives to efficient employees. D. Assumption of responsibilities by managers and supervisors. Criticisms faced scientific management school: a. It’s belief that the individual is lazy by nature, and therefore he must be constantly monitored and stimulated, especially in financial aspects. b. It’s view of the worker as a biological machine which can be controlled through financial incentives only. c. It’s reliance on the official organization and official relations in the organization, and its opinion about informal relations that arise in the organization as an evil thing that must be combated as it is directed against the administration. 51 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development d. Neglecting the human aspects of the human element and exploiting it through financial incentives. e. The belief that the individual is a selfish person who seeks to maximize his own gains at the expense of the public interest. Despite the criticism directed at Taylor's contributions that they neglected the human aspect, treated man like a machine, and focused on the material aspects only as determinants and directives of individual and group behavior in the organization, Taylor contributed to the advancement of the field of management by proving the possibility of studying management in a scientific manner. 2. Administrative Management Whereas scientific management works with the jobs of individual employees, administrative management focuses on managing the total organization. 52 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development The primary contributors to administrative management were Henri Fayol (1841–1925) Fayol tried to systematize management practice to offer guidance and direction to other managers. Fayol was also the first to recognize the certain managerial functions of planning, organizing, leading, and controlling. He believed that those functions accurately reflect the main core of the management process. 53 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Principles of Management set forth by Henri Fayol: 1) Division of Work: It’s assets to specialize in an activity which increases output with perfection. 2) Authority and Responsibility: Authority is closely linked with responsibility. Responsibility is critical to perform a job correctly. It is shouldered whenever authority is exercised. 54 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development 3) Discipline: Obedience and respect help an organization work smoothly. It is fundamental in all levels of management individuals. 4) Unity of Command: Each worker should receive orders from only one superior. 5) Unity of Direction: The efforts of everyone in the organization must be coordinated and focused in the same direction. 6) Subordination of Individual Interests to The General Interest: Resolving the tug of war among personal and organizational interests, in favor of the organization is one of management’s greatest difficulties. 7) Remuneration: Employees must be paid fairly in accordance with their contribution. 8) Centralization: The relationship among centralization and decentralization, is a matter of proportion; the optimum balance should be found for each organization. 55 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development 9) Scalar Chain: Subordinates must observe the formal chain of command unless obviously authorized by their respective superiors to communicate with each other. 10) Order: The principle of right place for everything and for everyone must be followed by management. The employees are selected scientifically and assigned duties due to their qualifications and ability. 11) Equity: It refers to combination of fairness, kindness and justice. It needs goodness and experience of managers and loyalty and devotion from workers. 12) Stability of Personnel: Security of job is a main factor. 13) Initiative: A manager must have conceiving and executing initiative. It has psychological impact on the workers. Managers must take decisions after getting suggestions from workers. 14) Esprit De Corps: All the workers of the organization are put together as a teamwork to attain the goals of the organization. The management must not follow the policy of divide and rule. 56 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Criticisms of Administrative Management Theory 1) Some administrative principles conflict with each other, such as the scope of supervision and the principle of reducing the number of administrative levels. 2) Some of these principles cannot implemented, such as the principle of specialization and unity of command, as there are no precise determinants for them. 3) There is confusion in the nouns of the principles and their significance, as the title of the principle may not explain its implications 4) There is doubt about the effectiveness of these principles. The Classical Management Perspective Today: the classical perspective focused on stable, simple organizations; various organizations today, in contrast, are changing and complex. They also, proposed universal guidelines which we now know that it do not fit every organization. A third limitation of the classical management perspective is that it slighted the role of the individual in organizations. This role was much more fully improved by advocates of the behavioral management perspective. 57 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development 3. Bureaucratic Management The German sociologist Max Weber (1864 - 1920) had a clear impact on the development of administrative organization theories. From his point of view, any organization - private, public, religious, etc. - must be represented by a bureaucratic system based on a hierarchy in which authority is chained from top to bottom. Max Weber saw the increasing need for the state to intervene in administrative activities. The organizational structure at that time was not appropriate to contribute effectively to solving social and political problems. From this standpoint, Max Weber developed a set of features and characteristics for the Ideal Type Bureaucracy. These characteristics must be characterized by this bureaucratic system in order to achieve the highest possible degree of “Efficiency.” Bureaucracy is defined as the ideal organization of large-sized organizations, in which systems, rules and regulations are established for the work of the organization, as a whole and clearly defines the function, authority, responsibility, superiors, subordinates and 58 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development lines of communication. Bureaucracy means “the development of a specialized administrative body whose work is to coordinate and control all employees of the organization.” The Defining Characteristics of Weber’s Bureaucratic Management are as follows: - 1) Labor is divided with obvious definitions of authority and responsibility, which are legitimized as official duties. 2) Positions are organized in a hierarchy of authority, every position reports to a higher level one. 3) All individuals are selected and promoted based on technical qualifications, that are evaluated by examination or according to training and experience. 4) Administrative acts and decisions are recorded in writing. Recordkeeping offers organizational memory. 5) Management is separate from the ownership of the organization. 6) Managers are subject to rules and procedures that would ensure reliable, predictable behavior. Rules are impersonal and uniformly applied to all employees. 59 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development From this it is clear that Max Weber was interested in describing the ideal organizational system in his view that can achieve the highest possible degree of productive efficiency and that material incentives are the only factor that can be used to influence an individual’s behavior. But he underestimated the importance, or at the very least, ignored other variables, such as the social and psychological aspect of the employee, the internal environment of the organization, and their impact on the morale of individuals and thus on their productivity. In addition, it does not discuss the external system environment data and the variables that may occur in it that affect the efficiency of the organization and its employees. This bureaucratic approach was not without some negative effects on the behavior of individuals: 1. Literal following to regulations and laws adds a kind of rigidity to the behavior of individuals. "Rigidity of behavior". 2. Not dealing with the organization’s employees as individuals who have desires, feelings, emotions, 60 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development and...etc. may lead them to reject the organization and not show enthusiasm for achieving its goals. 3. Imposing an automated system on individuals that may push them to be satisfied with the minimum performance standard. 4. The presence of strict systems and procedures that may push individuals to resist any type of change that the organization may desire, especially with the lack of encouraging incentives to accept a new situation. 5. People may resort to avoiding responsibility and making decisions or choosing only alternatives that fit the regulations and laws “Hide behind the rules”. 6. 6- Extremism and exaggeration in the application of rules and instructions in order to gain control. 7. 7- Focusing on the appearance aspect, especially at the higher administrative levels, such as titles. 61 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Learning Objective 3: The Behavioral Management Perspective Third: The Behavioral Management Perspective 1- Human Relations Interest in the human aspect in productive organizations began at the beginning of the 1930s and has continued until this date, and it represents the basic basis for organizational principles. This trend began with the famous “Hawthorne” studies by the thinker Elton May (1880 - 1949 AD), which he conducted with his research team in the Hawthorne factories. These studies aimed to know the relationships between physical factors such as lighting, rest hours, method of paying wages, etc., and “productivity” based on “The Rational Approach”. Expectations suggested the existence of a positive relationship between these material variables and productivity. Meaning that continuing to increase the intensity of lighting will be accompanied by an increase in performance on the part 62 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development of workers and vice versa. The same positive result for the other variables. But the results of this research proved contrary to what was expected. These material factors did not have a positive impact on the productivity of the individual. Rather, experiences have shown that social and humanitarian considerations have a greater impact on workers’ morale and thus on their productivity. Hawthorne Experiments 63 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development In general, the human relations school focused on six basic assumptions: 1) The need to focus on people rather than machines and physical factors alone 2) People exist in an organized business environment rather than an organized social context 3) The primary activity in human relations is to motivate individuals 4) Motivation should be directed towards teamwork which requires coordination and cooperation among the particular individuals in the organization 5) Human relations through teamwork seek to achieve individual and organizational goals at the same time. 6) Both individuals and organizations strive for organizational efficiency, i.e. they try to achieve maximum results with minimum inputs 64 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development The most important results of these studies can be summarized as follows: 1. Human factors have a greater impact on the level of satisfaction among employees and therefore their productivity than material factors 2. Any human gathering that results in what is known as informal organizations. These organizations establish certain “norms” that protect the behavior of individuals. 3. An individual’s behavior is affected by the moral incentives given to him 4. Social relations are among the variables that affect an individual’s behavior and thus his productivity. The research team also studied non-material variables such as improving human relations, methods of supervision, social interactions, incentive system, and job independence. In general, researchers have concluded that social factors are more important as determinants of individuals’ behavior and productivity than economic and material factors. 65 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Chester Barnard (1886 - 1961 AD) in his book “Functions of The Executive” 1938 reviewed the right to exercise authority in productive organizations. In his opinion, orders issued by senior management may not be implemented by subordinates for two reasons: First: it may be difficult to put them into practice. Second: The subordinate may believe that these orders are not within the powers of the person who issued them. Bernard believes that the organization is a cooperative system. Therefore, the use of authority must not be limited to the leadership, but rather the various administrative levels must participate. The orders issued by top management must be acceptable to people at the middle and executive management levels, and this is what Bernard referred to as the “Zone of Indifference." Bernard also stressed the importance of finding a kind of balance (Equilibrium) between what the worker offers to the organization in the form of work, time, and loyalty....and what he receives from the organization in the form of salary, reputation, incentives, etc. Finding this balance 66 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development to a satisfactory degree for the worker will affect his behavior and thus raise his level of performance. "Douglas Mccereger" 1943 classified the assumptions about the nature of the human soul into two groups, the first of which he called "X" and the second "Y'". The manager's behavior, from McGregor's point of view, depends on his adoption of either of the two groups. The most important hypothesis that distinguishes the first group is that a person by nature does not like work and tries to avoid it, desires subordination and evades responsibility. To guide an individual's behavior, based on these assumptions, the organization must use 67 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development punishment, threats and material incentives if it wishes to achieve its goals. Group Y assumes that the individual by nature loves to work and bear responsibility. He does not necessarily work for fear of punishment, but also for the hope of reward. this humanist approach is not without some drawbacks, including, for example: 1. Neglecting the formal organizational aspect, despite its importance in influencing individual behavior, and focusing on the human aspect 2. Neglecting the importance of contradictions and conflicts within the organization and the creativity, innovation, and change they may lead to...which are desirable things. 3. Focusing only on moral incentives as guides to the individual’s organizational behavior despite the importance of the material aspect of incentives. 2- Behavioral Approach Abraham Maslow's theory (1943) "The Hierarchy of Human Needs" is considered one of the most famous theories that attempted to explain human behavior. 68 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Human behavior, based on this theory, is determined when an individual tries to satisfy his desires. These desires take a hierarchical form, and it is possible to use the needs that occupy the base of the pyramid, “physiological needs,” to direct the individual’s behavior. If these needs are satisfied to a satisfactory degree, knowing that satisfaction is relative and varies from one person to another according to individual differences, the need will emerge, followed by the “need for security” as a determinant of the individual’s behavior. And so are the other needs - the social needs, recognition by others - then the needs for self- actualization, which occupy the top of the pyramid in terms of importance - knowing that the human need for recognition and self-actualization are considered infinite needs, so they can always be used to direct the behavior of individuals within the organization. Herbert Simon, winner of the Nobel Prize in 1978, in his book “Administrative Behavior” in 1949, took the analysis of decision-making as an approach to understanding individual behavior. From his point of view, an organization is nothing but a group of people 69 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development making decisions in order to achieve a common goal. The behavior of these individuals is affected by the "organizational structure", the type of communication method followed, "communications" and other formal aspects of the organization. He also sees the difficulty of using the stages of the traditional method in making decisions. This is because humans have limited mental capabilities and experiences, in addition to the lack of availability of information to the required degree and lack of time. E. Herzberg made a shift in the administrative thinking about the factors that affect an individual’s level of satisfaction and thus his productivity. The prevailing administrative belief before the studies of Herzberg and his team was that the lack of factors that lead to employee satisfaction necessarily leads to employee dissatisfaction. Also, the lack of factors that cause the employee to be dissatisfied, will push him to be more satisfied. “David Mccleland” 1966, confirmed that “Need For Achievement” and “Need For Power” in addition to the 70 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development individual’s need to work with friends, relatives and friends “Need For Affiliation” represent the basic factors that determine the quality of an individual’s behavior. People who have a need for achievement have specific behavior pattern, as they set for themselves non-fictional goals that are achievable, with a kind of challenge to their abilities and potentials. They prefer not to take risks at the expense of work. They prefer to deal with the problem and confront it and not leave it to the circumstances. They are more concerned with achievement than with the return from work. Lessons from the Behavioral Approach The behavioral approach makes it obvious to the present and the future managers that individuals are the key to productivity. According to advocates of the behavioral approach, technology, work rules, and standards do not guarantee good job performance. Instead, success bases on motivated and skilled people who are committed to organizational goals. Only a manager’s sensitivity to individual concerns may foster the cooperation necessary for high productivity. 71 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development The behavioral school of management is distinguished from its other theories, such as scientific management and human relations, in that it looks at human behavior in the context of the environment in which it is located. It takes into account a large number of influencing factors. It deals with the kinetic interaction that occurs between individual and group behavior on the one hand, and the environmental factors affecting it on the other. As for the study of individual and group behavior, it includes the personality of the individual, his upbringing, his motives, and the factors that influence his formation. In addition to, surrounding groups such as family, school, friends and co-workers. So, that the view of behavior is integrated and clarifies the areas of influence between these important overlapping elements. The behavioral school also directs its attention to studying the environmental factors that exist in the large society such as: economic, technological, social and educational factors. This school wants to help the administration in understanding the behavioral phenomena around it. And then to reach the best ways to deal with workers and achieve the productive and human goals it seeks. 72 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Learning Objective 4: The Quantitative Management Perspective Fourth: The Quantitative Management Perspective During World War II, military planners began to use mathematical models to solve defense and logistical problems. After the war ended, business organizations began to assemble teams of experts in quantitative studies to solve many complex issues facing large organizations. The quantitative management approach is based on the application of quantitative analysis to make 73 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development administrative decisions and solves the problems facing business organizations. Quantitative management helps the manager to take decision by developing mathematical models of the problem. The rapid development of computers has played a major role in developing the use of quantitative methods. The advantages of using quantitative methods in management are as follows: 1) Assisting in making quantitative decisions using modern scientific methods. 2) Quantitative methods help in making decisions in a more accurate manner and away from randomness resulting from trial and error. 3) The use of mathematical models helps to achieve the efficient allocation of available resources. 4) Quantitative methods help to analyze and solve complex problems that are difficult to address in their ordinary form. 5) It helps to save the cost of solving various problems by reducing the time needed to solve. 74 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development 6) It helps focus attention on the important dimensions of the problem without going into details that do not influence the decision. Despite the advantages of relying on quantitative methods in decision-making, many managers do not rely on quantitative methods as a primary decision-making approach. It is usually used as a supplement when making a decision. Also, many managers base their decision-making on outcomes that are consistent with their opinions and beliefs and reject those outcomes that are inconsistent with what they believe in. The reasons why managers do not rely on quantitative methods can be summarized as follow: 1) Many managers are not sufficiently trained to qualify them to apply these methods. 2) Many variables affecting management decisions cannot be expressed quantitatively. 3) There are many decisions facing managers, which are non-routine and difficult predict it. 75 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development Learning Objective 5: Contemporary Management Perspectives Fifth: Contemporary Management Perspectives It is very important to recognize that the classical, behavioral, and quantitative approaches to management are not necessarily contradictory or mutually exclusive. Even though each of the 3 perspectives makes very different assumptions and predictions, each may also complement the others. Indeed, a complete understanding of management needs an appreciation of all three perspectives. The systems and contingency perspectives may help us integrate those earlier approaches and enlarge our understanding of all three. 76 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development 1- The Systems Perspective The systems began to appear in the fifties of the last century. Systems theory views management as a set of inter-related and interdependent parts that interact together in a specific sequence that helps achieve the goals of the organization. The system is defined as “a unified organized unit consisting of two or more interconnected parts”. This definition emphasizes the need to consider the system as an integrated unit, where changes in one part of the system affect the rest of the system parts. The systems perspective is a critical contemporary management perspective. A system is an interrelated set of elements functioning as a whole. Thinking of organizations as systems offers us various important viewpoints on organizations, such as the concepts of open systems, subsystems. Open systems are systems that interact with their environment, whereas closed systems do not interact with their environment. Although organizations are open systems, some make the mistake of ignoring their environment and behaving as though it is not important. 77 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development There are a set of assumptions about what an organization is: 1. Its activities must undergo some type of continuous change to reflect the environment in which this organization exists. 2. There are different levels of behavior: behavior that occurs at the level of individuals, “individual behavior,” behavior that occurs at the group level, “group behavior,” then behavior at the organization level ”organizational behavior”. It is expected that the behavior of the individual will differ from the behavior of the group and the behavior of the organization. These levels also interact with each other, as behavior at the organization level is affected by the behavior of individuals, and the group’s behavior pattern is determined by its members, and the behavior of each member is affected by the restrictions imposed by the group and the opportunities it provides. Both levels are behaviorally affected by the formal aspect of the organization. 78 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development In addition to the impact of the external environment on all previous levels, these three levels are discussed as follows: - A. The individual level: The individual’s behavior is the result of the process of integrating some of the external influences with his individual characteristics, “his attitudes, his values, his level of awareness...” in addition to the pressures of the group to which he belongs and the regulations and laws that govern the workflow and represent the official side of the organization. Considering customs, traditions, religion and other data of its external environment. All these variables, in varying proportions, shape an individual's behavior. B. The group level: Man is social by nature. Therefore, we rarely find a member of an official organization who does not belong to a specific group. These groups, as mentioned previously, establish certain “norms” that govern the behavior of their members. In return, these groups create 79 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development opportunities for their members that may not be available to those who are not members. C. Organizational level: The regulations and laws that govern everything related to the organization and its employees are formulated from the first moment of its establishment. The behavior of individuals, including leaders and subordinates, at various administrative levels takes place within the framework of the restrictions imposed on them by these systems and the opportunities created for them. D. Environment: Organizations do not operate in a vacuum. Rather, they are considered part of the outside world. They derive everything they need from their external environment and provide this environment with their production in the form of goods and services. The success of the organization depends on the competence of its leaders to interact positively with the external environment of the organization. 3. The organization’s behavior: is affected by the available social and technical aspects. Therefore, we 80 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development find that business and manufacturing organizations include the characteristics of a system consisting of a group of elements interacting with each other and which are in a state of interaction with their external environment. The systems perspective also, stresses the importance of subsystems which are systems within a broader system. A subsystem is a smaller component of a larger system. Table (1) shows advantage and disadvantages of system approach. Table 2.1: Advantage and Disadvantages of System Approach Disadvantages of Systems Advantages of Systems Approach Approach It helps in studying the functions of It cannot be easily applied to large complex organizations and complex organization It highlights interdependence between It is not suitable for smaller various elements in an organization organization It provides clue to the complex No tools and techniques are provided behavior of the people to the managers to implement 81 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development 2- The Contingency Perspective Another noteworthy recent addition to management thinking is the contingency perspective. The classical, behavioral, and quantitative approaches are considered universal perspectives as they try to identify the “one best way” to manage organizations. The contingency perspective, in contrast, suggests that universal theories cannot be applied to organizations because each organization is unique. Instead, the contingency perspective suggests that appropriate managerial behavior in a given situation bases on, or is contingent on, unique elements in that situation. 82 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development In contrast to the traditional schools and human relations that are based on the existence of a set of scientific principles that are applicable in all organizations and in all administrative situations, the Situational School is based on a basic idea that the operations practiced by management depends to a large extent on a set of variables that differ from one situation to another, from one organization to another. Accordingly, there is no so- called optimal method of management, but the appropriate method of management depends on the interaction between a group of variables, including the environment of the organization, the organization, its life cycle, the techniques used and the strategies of the organization, the type of workers, the nature of the organization’s work and the prevailing culture. Figure (2): Features and Advantages of Contingency Approach 83 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development 3- Theory Japanese Management Japanese management is one of the modern management theories that achieved remarkable success, invented by the Japanese scientist William Ouchi, which he presented in the book “Theory Z.” As a result, Japanese companies achieved greater productivity than American companies. Specifically, it is based on the principle of respect for the head of the family and obeying his orders, while being responsible for them and participating with them in decision-making. The Attention to Japanese management starts since the beginning of the eighties as a result of the tremendous successes achieved by Japanese business 84 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development institutions since the end of World War II until now in terms of product quality, size and personnel productivity. The elements of Japanese management are as follows: 1. Job guarantee for the employee for life, which gives the stability and job security, as Japanese institutions do not tend to laying off individuals even in the most difficult economic conditions, which had the greatest impact on their creativity and productivity. 2. Working as a team, and group sense of responsibility for the work that an individual does. In many cases, production is measured by group effort, and the reward is collective, not individual. 3. The method of participation in decision-making, which creates harmony and compatibility between the goals of the employees and the goals of the institution, and provides a kind of self-monitoring, and the method of participation is represented in the so-called Quality Circles, which is a small working group formed at the level of organization with the aim of securing everyone and their participation in improving the organization, 85 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development performance/production, and analyzing technical and administrative problems and proposing solutions to them 4. Comprehensive attention to individuals, in terms of equal opportunities, justice, equality and dealing with human forces without discrimination, and providing them with the elements of life and stability in terms of housing, luxury and requirements for decent living, which creates an atmosphere of cooperation and mutual respect between them, and a kind of natural interaction between work and social life. 5. Avoiding rush on evaluation and promotion, and focus on developing the professional skills of individuals, as the employee is transferred from one position to another at the same administrative level to give the work a comprehensive and integrated character. Lessons from the Contingency Approach Although still not fully developed, the contingency approach is a helpful addition to management thought as it emphasizes situational appropriateness. individuals, organizations, and problems are too complex to justify 86 Dr/ Nada Shaban Dr/ Ahmed Farouk Chapter 2……………. Organizational Behavior Development rigid adherence to universal principles of management. In addition, contingen

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