Chapter 1 What is OB?

OB is a field of study devoted to understanding, explaining, and ultimately improving the attitudes and behaviours of individuals and groups in organizations An organization is a structured social system consisting of groups and individuals working together to meet some agreed-upon objectives. Organizations are open systems -- that is, they are self sustaining systems that use energy to transform resources from the environment into some form of output. Scholars in mgmt departments and scientists in business orgs conduct research on OB Contrasts with human resource mgmt (which takes theories and principles of OB and explores the nuts and bolts applications) OB study might explore the relationship between learning and job performance, whereas an HR mgmt study might examine the best ways to structure training programs to promote employee learning Strategic mgmt focuses on the product choices and industry characteristics affect an organizations profitability. They will study the relationship between firm diversification and firm profitability Role of management theory Theories and concepts in OB have also been heavily influenced by the popular mgmt approaches of the day, such as Frederick Winslow Taylors theory of scientific management, where he focused on designing optimal and efficient work processes. (optimize performance of any task) Bureaucracy is another important contributor to the classical approach to mgmt was Max Weber, an organizational form that emphasizes the control and coordination of its members through a strict chain of command, formal rules and procedures, high specialization, and centralized decision making Superior form of organizing, coordinating, and controlling human work activities Human relations movement emerged as mgmt scholars began to recognize that the psychological attributes of individual workers (needs, attitudes) and social forces within work groups had important effects on behaviours Fundamental to contingency approach is the idea that there is no one-best, universal principles and same is true for OB Integrative model of OB Two Primary individual outcomes the right-most portion of the model, two employees have 2 primary gals for their working lives: to perform their jobs well and to remain a member of the organization that they respect. Likewise, most managers have two primary goals for their employees: maximize performance and to ensure that they stay with the firm for a significant length of time o Job Performance o Commitment (Retention and Withdrawal Behaviours) o Starting points Individual Mechanisms Linked to Outcomes (they affect job performance and commitment DIRECTLY)

Chapter 1 What is OB?

Job Satisfaction captures what employees feel when thinking about their job and daily work o Stress reflects employees psychological responses to job demands that exceed their capacities o Motivation captures energetic forces that drive employees work effort o Trust, Justice, and Ethics reflect the degree to which employees feel that their company conducts business with fairness, honesty, and integrity o Learning and Decision Making deals with how employees gain job knowledge and how they use that job knowledge to make accurate judgments on the job The Relation between the Individual Mechanisms and Outcomes occur within an Individual, Group and Organizational Context (influence individual mechanisms and individual outcomes) o Personality, Cultural Values and Ability influence how we behave at work and kinds of tasks that interest us, and might account for our responses to events that happen on the job o Team Characteristics and Processes shape individual mechanisms like motivation, where we explore the structure of effective work groups, such as their norms, roles, and the way members depend on one another o Power and Influence summarizes the process in which individuals attain authority over others o Leadership Styles and Behaviours are what individuals use to take influence others at work o Organizational Structure centralized vs decentralized o Organizational Culture captures the way they are in the organization rules, norms, values that shape attitudes and behaviours of employees o

Chapter 1 What is OB?

Does OB matter? Does a firms ability to manage OB have any bearing on its bottom-line profitability? Maybe, since if a firm has a good enough product, effective OB can keep the product good over the long term and also help the product get better over the long term, if it is currently a bad enough product. Building a conceptual argument Might affect bottom line profitability Consider this question from a resource-based perspective. Examples of a firms resources that are related to OB: Knowledge, decision-making, ability, wisdom of the workforce as well as its image, and culture Resource based view is a model that argues that rare and inimitable resources help firms maintain competitive advantage Describes what exactly makes resources valuable that is, what makes them capable of creating long term profits for the firm. A firm`s resources include financial (rev and equity) and physical (buildings, machines, technology) resources, but they also include resources related to OB, such as the knowledge, decision making, ability, and wisdom of the workforce, as well as the image, culture and goodwill of the organization This view suggests that the value of resources depends on several factors Resource is more valuable when it is rare (in short supply). Ex: diamonds, oil, etc are al expensive because they are hard to find. Good people are also rare and hard to find. If good people are rare, then effective mgmt of OB should prove to be a valuable resource The resource based view also suggests that a resource is more valuable when it is inimitable meaning that it cannot be easily copied. Ex: good people cannot be or very difficult to imitate o 3 reasons why people are inimitable o People create history a collective pool of experience, wisdom, and knowledge that benefits the organization o Numerous small decisions capture the idea that people make many small decisions day in and day out o Big decisions can be copied and are visible to competitors and observable by industry experts and analysts. o To successfully mimic a competitor, it would be necessary to take into consideration all the day to day decisions and trade offs that employees make every day. Ex: watching a flight attendant spontaneously use humour to attract inattentive passengers to safety instructions, or observing a ticket agent use his discretion to make an anxious passenger smile (all of which are INVISIBLE to competitors) o Socially complex resources - people are the source of these, like culture, teamwork, trust and reputation o termed socially complex because it is not always clear how they came to develop, though it is clear which organization do (and do not possess them) o LEADERSHIP, culture and teamwork cannot be easily copied

Chapter 1 What is OB?