Introduction to Organizational Behavior

Organizational Behavior - systematic study of the actions

and attitudes that people exhibit within organizations
The field of OB seeks to replace intuitive explanations
with systematic study

Goals of Organisational Behaviour

Explain, predict, and control human behavior

 Why Do We Study OB?

• Tolearn about yourself and how to deal with others

• You are part of an organization now, and will continue to be
a part of various organizations
• Organizations are increasingly expecting
individuals to be able to work in teams, at least
some of the time
• Some of you may want to be managers or
entrepreneurs
What Is an Organization?

A consciously coordinated social unit, composed of a group

of people, which functions on a relatively continuous basis
to achieve a common goal or set of goals.
 Determinants of Employee Performance
Productivity
Absenteeism
Turnover

organizational behaviour is a field of study that investigates

the impact that individuals, groups and structure have on
behaviour withinorganizations, for the purpose of applying
such knowledge toward improving an organization’s
effectiveness.

Systematic study - the use of scientific evidence gathered

under controlled conditions and measured and interpreted in
a reasonably rigorous manner to attribute cause and effect
 Challenges Facing the Workplace
•Organizational Level
• Productivity
• Developing Effective Employees
• Global Competition
• Managing in the Global Village Group Level
• Working With Others
• Workforce DiversityIndividual Level
• Job Satisfaction
• Empowerment
• Behaving Ethically
 Contributing Disciplines
Psychology seeks to Sociology studies
measure,explain, people in relation to their
and change fellow human beings
behavior

Social psychology
focuses on the
influence of people
on one another

Political science is the

Anthropology is the
study of the
study of societies
behavior of individuals
to learn about human
and groups within
beings and their activities
a political environment
Responding to Globalization
Increased Foreign Assignments
Working with People from Different
Cultures
Coping with Anti-Capitalism Backlash
Overseeing Movement of Jobs to
Countries with Low-cost Labor
 OB Insights
Improving People Skills
Improving Customer Service
Empowering People
Working in Networked Organizations
Stimulating Innovation and Change
Coping with “Temporariness”
Helping Employees Balance Work/Life
Conflicts
Declining Employee Loyalty
Improving Ethical Behavior
 Definition of Learning

A relatively permanent change

in behaviour (or behaviour
tendency) that occurs as a
result of a person’s interaction
with the environment
 How Learning Occurs
Classical Conditioning

Bell No Response

Unconditioned
Unconditioned Stimulus Response
(Food) (Salivation)
During
Unconditioned
Conditioning
Stimulus
(Food)
Conditioned Stimulus
(Bell) Unconditioned
Response (Salvation)

Conditioned Stimulus Conditioned Response

(Bell) (Salivation)
Operant Conditioning
 Contingencies of
Reinforcement
Consequence No Consequence
is introduced consequence is removed

Behaviour
increases/ Positive Negative
maintained reinforcement reinforcement

Behaviour Punishment Extinction Punishment

decreases
Schedules of Reinforcement
Behaviours
1 2 3 4 5 6 7 8 9

Continuous

Fixed ratio
Variable ratio
Time (Days)
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
Fixed interval

Variable interval
Kolb’s Experiential Learning
Model
Concrete
experience

Active Reflective
experimentation observation

Abstract
conceptualization
 Developing a Learning
Orientation
Value the generation of new
knowledge
Reward experimentation
Recognize mistakes as part of
learning
Encourage employees to take
reasonable risks
 Action Learning
Experiential learning in which
employees are involved in a ‘real,
complex and stressful problem’,
usually in teams, with immediate
relevance to the company
– Concrete experience
– Learning meetings
– Team conceptualizes and applies a
solution to a problem
 Learning and OB
Stimulus generalization in Organizations

Stimulus discrimination in Organizations

Learning and Training

Learning Through Training

Employee Indiscipline
What is Personality?
Personality Determinants
Heredity
Environment
Situation
Family
Social
Personality Traits
The
TheBig
Big Five
FiveModel
Model
The
The Myers-Briggs
Myers-Briggs Type
Type Indicator
Indicator

Personality
PersonalityTypes
Types
••Extroverted
Extrovertedor
orIntroverted
Introverted(E
(E
or
orI)I)
••Sensing
Sensingor
orIntuitive
Intuitive(S
(Sor
orN)
N)
••Thinking
Thinkingor
orFeeling
Feeling(T
(Tor
orF)
F)
••Perceiving
Perceivingor
orJudging
Judging(P(Por
orJ)
J)
OTHER PERSONALITY TRAITS Achievement
Orientation

Authoritarianism Self - Esteem

Locus of Control Risk -Taking

Personality
Traits
Machiavellism Self - Monitoring

Introversion Type A Type B

Extroversion Personality
Major
Major Personality
Personality Attributes
Attributes Influencing
Influencing OB
OB

Locus of control
Machiavellianism
Self-esteem
Self-monitoring
Propensity for risk taking
Type A personality
Locus
Locus of
of Control
Control
Machiavellianism
Machiavellianism

Conditions
ConditionsFavoring
FavoringHigh
HighMachs
Machs
••Direct
Directinteraction
interaction
••Minimal
Minimalrules
rulesand
andregulations
regulations
••Distracting
Distractingemotions
emotions
Self-Esteem
Self-Esteem and
and Self-Monitoring
Self-Monitoring
 Risk-Taking
Risk-Taking
High Risk-taking Managers
– Make quicker decisions.
– Use less information to make decisions.
– Operate in smaller and more entrepreneurial
organizations.
Low Risk-taking Managers
– Are slower to make decisions.
– Require more information before making decisions.
– Exist in larger organizations with stable environments.
Risk Propensity
– Aligning managers’ risk-taking propensity to job
requirements should be beneficial to organizations.
Personality
Personality Types
Types
Achieving
Achieving Personality-Job
Personality-Job Fit
Fit

Holland’s
Holland’s
Typology
Typologyof
of
Personality
Personality
and
and
Congruent
Congruent
Occupation
Occupation
ss
OB
OB Applications
Applications of
of Understanding
Understanding Emotions
Emotions

Ability and Selection

– Emotions affect employee effectiveness.
Decision Making
– Emotions are an important part of the
decision-making process in organizations.
Motivation
– Emotional commitment to work and high
motivation are strongly linked.
Leadership
– Emotions are important to acceptance of
messages from organizational leaders.
OB
OB Applications
Applications of
of Understanding
Understanding Emotions
Emotions

Interpersonal Conflict
– Conflict in the workplace and individual
emotions are strongly intertwined.
Deviant Workplace Behaviors
– Negative emotions can lead to employee
deviance in the form of actions that violate
established norms and threaten the
organization and its members.
Productivity failures
Property theft and destruction
Political actions
Personal aggression
Defining
Defining Motivation
Motivation

Key
KeyElements
Elements
1.1. Intensity:
Intensity:how
howhard
hardaaperson
persontries
tries
2.2. Direction:
Direction:toward
towardbeneficial
beneficialgoal
goal
3.3. Persistence:
Persistence:how
howlong
longaaperson
persontries
tries
 Challenges of Motivating
Employees
Changing workforce
– Younger employees have different
needs
– Diverse workforce
Layoffs, restructuring
– Damaged trust, commitment
Flatter organizations
– Fewer supervisors to monitor
performance
 Needs Hierarchy Theory
Needs Hierarchy
Theory

Self- Maslow arranged five

Actualization needs in a hierarchy
Esteem
Satisfaction-progression
process
Belongingness People who experience
self-actualization desire
Safety more rather than less of this
need
Physiological Not much support for
Maslow’s theory
Theory
Theory XX and
and Theory
Theory YY (Douglas
(Douglas McGregor)
McGregor)
 Holland’s
Typology of
Personality
and Congruent
Occupations
Two-Factor
Two-Factor Theory
Theory (Frederick
(Frederick Herzberg)
Herzberg)
Factors characterizing events
on the job that led to extreme
job dissatisfaction

Factors characterizing events

on the job that led to extreme
job satisfaction

Comparison
Comparisonof of
Satisfiers and
Satisfiers and
Dissatisfiers
Dissatisfiers
 Contrasting
Contrasting Views
Views ofof Satisfaction
Satisfaction
and
and Dissatisfaction
Dissatisfaction

Presence Absence
 ERG Theory ( Alderfer)
Needs Hierarchy ERG
Theory Theory

Self- Alderfer’s model has

Actualization
Growth three sets of needs
Esteem Adds frustration-
regression process to
Belongingness Relatedness
Maslow’s model
Safety Somewhat more
Existence research support than
Physiological Maslow’s theory
Innate Drives Theory
• Need to take/keep objects and
Drive to Acquire experiences
• Basis of hierarchy and status

• Need to form relationships and

Drive to Bond social commitments
• Basis of social identity

• Need to satisfy curiosity and

Drive to Learn resolve conflicting information
• Basis of self-actualization

• Need to protect ourselves

Drive to Defend • A reactive (not proactive) drive
• Basis of fight or flight
Innate Drives and Motivation
Emotional brain centre relies on
innate drives to assign emotional
markers to incoming information
Emotional markers influence
rational thoughts and become the
conscious sources of motivation
 Learned Needs Theory
Some needs are learned, not innate
Need for achievement
– desire for challenging and somewhat risky
goals, feedback, recognition
Need for affiliation
– desire to seek approval, conform, and avoid
conflict
– try to project a favourable self-image
Need for power
– desire to control one’s environment
– personalized versus socialized power
Implications of Needs-based
Theories
Organizations need to support
employees to achieve a balance of
their innate needs
People have different needs at
different times
Offer employees a choice of
rewards
Do not rely too heavily on financial
rewards
Expectancy
Expectancy Theory
Theory
 Expectancy Theory in
Practice
Increasing the E-to-P expectancy
– training, selection, resources, clarify roles,
provide coaching and feedback
Increasing the P-to-O expectancy
– Measure performance accurately, clarify
outcomes, explain how rewards are based
on past performance, provide examples
Increasing outcome valences
– Use valued rewards, individualize rewards,
minimize countervalent outcomes
 Effective Goal Setting
Specific

Relevant

Challenging
Task Task
Effort Performance
Commitment

Participation

Feedback
Characteristics of Effective
Feedback

Specific

Credible Effective Relevant

Feedback

Sufficiently
Timely
frequent
 Multisource (360-degree)
Feedback
Supervisor
Project
Customer
leader

Co-worker Evaluated Co-worker

Employee

Subordinate Subordinate
Subordinate
What
What Is
Is Perception,
Perception, and
and Why
Why Is
Is ItIt Important?
Important?

••People’s
People’s behavior
behavior isis
based
based on on their
their
perception
perception of of what
what
reality
reality is,is, not
not on
on
reality
reality itself.
itself.
••The
The world
world as as itit isis
perceived
perceived isis thethe worldworld
that
that isis behaviorally
behaviorally
important.
important.
Perceptual Process Model
Environmental Stimuli

Feeling Hearing Seeing Smelling Tasting

Selective Attention

Organization and
Interpretation

Emotions and
Behaviours
 Selective Attention
Characteristics of the object
– size, intensity, motion, repetition,
novelty

Perceptual context

Characteristics of the perceiver

– attitudes
– perceptual defense
– expectations -- condition us to expect
events
Factors
FactorsThat
That
Influence
Influence
Perception
Perception

EXHIBIT 5-1
Person
Person Perception:
Perception: Making
Making Judgments
Judgments About
About
Others
Others

Distinctiveness:
Distinctiveness:shows
showsdifferent
differentbehaviors
behaviorsinindifferent
different
situations.
situations.
Consensus:
Consensus:response
responseisisthe
thesame
sameasasothers
othersto tosame
same
situation.
situation.
Consistency:
Consistency:responds
respondsininthe
thesame
sameway
wayover
overtime.
time.
Attribution
Attribution Theory
Theory
 Errors
Errors and
and Biases
Biases in
in Attributions
Attributions

Errors
Errors and
and Biases
Biases in
in Attributions
Attributions (cont’d)
(cont’d)
Errors
Errors and
and Biases
Biases in
in Attributions
Attributions
Frequently
Frequently Used
Used Shortcuts
Shortcuts in
in Judging
Judging Others
Others
 Stereotyping
Process of assigning traits to people based on their
membership in a social category
– Categorical thinking
– Strong need to understand and anticipate others’ behaviour
– Enhances our self-perception and social identity

Minimizing Stereotyping Biases

Diversity awareness training
– educate employees about the benefits of diversity and
dispel myths

Meaningful interaction
– Contact hypothesis
Decision-making accountability
– use objective criteria in decision-making
Specific
Specific Applications
Applications in
in Organizations
Organizations
Employment Interview
– Perceptual biases affect the accuracy of interviewers’
judgments of applicants.
Performance Expectations
– Self-fulfilling prophecy (pygmalion effect): The lower or
higher performance of employees reflects preconceived
leader expectations about employee capabilities.
Performance Evaluations
– Appraisals are subjective perceptions of performance.
Employee Effort
– Assessment of individual effort is a subjective judgment
subject to perceptual distortion and bias.
 Other Perceptual Errors
Primacy
– first impressions
Recency
– most recent information dominates
perceptions
Halo
– one trait forms a general impression
Projection
– believing other people are similar to
you
 Improving Perceptions
Empathy
– Sensitivity to the feelings, thoughts,
and situation of others
– Cognitive and emotional component
Self-awareness
– Awareness of your values, beliefs and
prejudices
– Applying Johari Window
 Conflict Defined

The process in which one party

perceives that its interests are being
opposed or negatively affected by
another party.
Conflict
 The Conflict Process

Conflict
Perceptions
Sources of Manifest Conflict
Conflict Conflict Outcomes
Conflict
Emotions

Conflict
Escalation Cycle
Task vs. Socioemotional
Conflict
Task-related conflict
– Conflict is aimed at issue, not parties
– Helps recognize problems, identify
solutions, and understand the issues
better
– Potentially healthy and valuable

Socioemotional conflict
– Conflict viewed as a personal attack
– Introduces perceptual biases
– Distorts information processing
 Organizational Conflict
Outcomes
Conflict Management
– Interventions that alter the level and
form of conflict for organizational
effectiveness

Constructive Conflict
– Encourages people to learn about
other points of view
 Organizational Conflict
Outcomes
Potential benefits
– Improves decision making
– Strengthens team dynamics

Dysfunctional outcomes
– Diverts energy and resources
– Weakens knowledge management
– Increases frustration, job
dissatisfaction, stress, turnover and
absenteeism
 Sources of Conflict

Incompatible • One party’s goals perceived to

Goals interfere with other’s goals

• Different values/beliefs
Differentiation • Explains cross-cultural and
generational conflict

• Conflict increases with

Task interdependence
Interdependence • Higher risk that parties interfere with
each other
more
 Sources of Conflict (con’t)

Scarce • Motivates competition for the resource

Resources

• Creates uncertainty, threatens goals

Ambiguous Rules • Without rules, people rely on politics

• Increases stereotyping
Communication • Reduces motivation to communicate
Problems • Escalates conflict when arrogant
Conflict Management Styles
High
Forcing Problem-Solving
Assertiveness

Compromising

Avoiding Yielding

Low High
Cooperativeness
 Conflict resolution
Emphasizing Superordinate Goals
Emphasizing common objectives rather than conflicting sub-goals
Reduces goal incompatibility and differentiation
Reducing Differentiation
Remove sources of different values and beliefs
Move employees around to different jobs, departments, and regions
Other ways to reduce differentiation:
– Common dress code/status
– Common work experience

Better Communication/Understanding
Employees understand and appreciate each other’s views through
communication
– Informal gatherings
– Formal dialogue sessions
– Teambuilding activities
 Other Ways to Manage Conflict
Reduce Task Interdependence
– Dividing shared resources
– Combine tasks
– Use buffers

Increase Resources
– Duplicate resources

Clarify Rules and Procedures

– Clarify resource distribution
– Change interdependence
 Situational Influences on
Negotiation
Location

Physical
Setting

Time Passage
and Deadlines

Audience
 Effective Negotiator
Behaviours
Preparation and
Goal Setting

Gathering
Information

Communicating
Effectively

Making Concessions
 Types of Third Party
Intervention
High
Mediation Inquisition

Level of
Process
Control

Arbitration

Low Level of Outcome Control High

Organizational Culture Defined

The basic pattern of shared assumptions,

values, and beliefs considered to be the
correct way of thinking about and acting
on problems and opportunities facing the
organization.
 The Basic Functions of
Organizational Culture

Organizational
Culture/basic functions

Provides a
Enhances Clairifies
sense of
commitment and
identity for
to the reinforces
members
organization’s standards
mission of behavior
What
What Is
Is Organizational
Organizational Culture?
Culture?
What
What Is
Is Organizational
Organizational Culture?
Culture?
Culture Versus Formalization
– A strong culture increases behavioral
consistency and can act as a substitute
for formalization.
Organizational Culture Versus National
Culture
– National culture has a greater impact on
employees than does their organization’s
culture.
– Nationals selected to work for foreign
companies may be atypical of the
local/native population.
 What
What Do
Do Cultures
Cultures Do?
Do?

Culture’s
Culture’sFunctions:
Functions:
1.1. Defines
Definesthe
theboundary
boundarybetween
betweenone
one
organization
organizationand
andothers.
others.
2.2. Conveys
Conveysaasense
senseof
ofidentity
identityfor
forits
itsmembers.
members.
3.3. Facilitates
Facilitatesthe
thegeneration
generationofofcommitment
commitmentto
to
something
somethinglarger
largerthan
thanself-interest.
self-interest.
4.4. Enhances
Enhancesthe
thestability
stabilityof
ofthe
thesocial
socialsystem.
system.
What
What Do
Do Cultures
Cultures Do?
Do?

Culture
Cultureas
asaaLiability:
Liability:
1.1. Barrier
Barrierto
tochange
change
2.2. Barrier
Barrierto
todiversity
diversity
3.3. Barrier
Barrierto
toacquisitions
acquisitionsand
and
mergers
mergers
 Core Organizational Values
Reflected in Culture

•Sensitivity to needs of customers and employees

•Freedom to initiate new ideas

•Willingness to tolerate taking risks

•Openness to communication options

 Elements of Organizational
Culture
Artifacts of Physical Structures
Organizational Language
Culture
Rituals and
Ceremonies
Stories and Legends

Organizational Beliefs
Culture Values
Assumptions
Artifacts: Stories and Legends
Social prescriptions of desired
(undesired) behaviour
Provides a realistic human side to
expectations
Most effective stories and legends:
– Describe real people
– Assumed to be true
– Known throughout the organization
– Are prescriptive
 Artifacts: Rituals and
Ceremonies
Rituals
– programmed routines
– (eg., how visitors are greeted)

Ceremonies
– planned activities for an audience
– (eg., award ceremonies)
 Artifacts: Organizational
Language
Words used to address people,
describe customers, etc.
Leaders use phrases and special
vocabulary as cultural symbols
– eg. Container Store’s “Being Gumby”
Language also found in subcultures
– eg. Whirlpool’s “PowerPoint culture”
Artifacts: Physical Structures and
Symbols
Building structure -- may shape and
reflect culture

Office design conveys cultural

meaning
– Furniture, office size, wall hangings
Organizational
Organizational Culture
Culture
 The Process of Innovation

Stage 1 Stage 2 Stage 3 Stage 4 Stage 5 Progress

Setting Setting Producing Testing and Outcome Success

the the the Implementing Assessment End
Agenda Stage Ideas the Ideas Failure
End

Individual
Motivation or Team
Productivity

Resources

Skills
Creating
Creating aa Customer-Responsive
Customer-Responsive Culture
Culture
Managerial
ManagerialActions:
Actions:
•• Select
Selectnew
newemployees
employeeswith
withpersonality
personalityand
and
attitudes
attitudesconsistent
consistentwith
withhigh
highservice
service
orientation.
orientation.
•• Train
Trainand
andsocialize
socializecurrent
currentemployees
employeestotobe
be
more
morecustomer
customerfocused.
focused.
•• Change
Changeorganizational
organizationalstructure
structureto
togive
give
employees
employeesmore
morecontrol.
control.
•• Empower
Empoweremployees
employeestotomake
makedecision
decisionabout
about
their
theirjobs.
jobs.
Creating
Creating aa Customer-Responsive
Customer-Responsive Culture
Culture
Managerial
ManagerialActions
Actions(cont’d)
(cont’d)::
•• Lead
Leadby
byconveying
conveyingaacustomer-focused
customer-focusedvision
vision
and
anddemonstrating
demonstratingcommitment
commitmenttotocustomers.
customers.
•• Conduct
Conductperformance
performanceappraisals
appraisalsbased
basedon
on
customer-focused
customer-focusedemployee
employeebehaviors.
behaviors.
•• Provide
Provideongoing
ongoingrecognition
recognitionfor
foremployees
employeeswho
who
make
makespecial
specialefforts
effortsto
toplease
pleasecustomers.
customers.
 Keeping
Keeping Culture
Culture Alive
Alive
Selection
– Concerned with how well the candidates
will fit into the organization.
– Provides information to candidates about
the organization.
Top Management
– Senior executives help establish behavioral
norms that are adopted by the
organization.
Socialization
– The process that helps new employees
adapt to the organization’s culture.
Stages
Stages in
in the
the Socialization
Socialization Process
Process
How
How Organization
Organization Cultures
Cultures Form
Form
How
How Employees
Employees Learn
Learn Culture
Culture

•• Stories
Stories
•• Rituals
Rituals
•• Material
MaterialSymbols
Symbols
•• Language
Language
Spirituality
Spirituality and
and Organizational
Organizational Culture
Culture

Characteristics:
Characteristics:
• • Strong
Strongsense
senseofof
purpose
purpose
• • Focus
Focusononindividual
individual
development
development
• • Trust
Trustand
andopenness
openness
• • Employee
Employee
empowerment
empowerment
• • Toleration
Tolerationof
ofemployee
employee
expression
expression
 “Vulnerable Sensitive. Honest about your weakness.
Just the qualities you need to be a strong leader”.
Consider leading softly is more effective than armour
plated command and control.
Harvard Business Review
“Failing Organisations are usually over-managed and
under-led”. Warren G Bennis
Today’s Presentation is aimed at:
Discussing the necessity of leadership.
Understanding and finding implications of different
leadership styles.
Identifying differences between Manager and Leader.
Theories of leadership.
“Leadership is the ability to persuade others to seek
defined objectives enthusiastically. It is the human factor
which binds a group together and motivates it towards
goals”. Keith Davis
“Leadership is the art or process of influencing people so
that they will strive willingly and enthusiastically towards
the achievement of group goals”. Koontz
“Leadership is the quality of behaviour of individuals
whereby they guide people or their activities in organising
efforts”. Chester Barnard
It implies:
– It is a continuous process.
– Essentially a process of influencing.
– Basically a personal quality.
– A continuous motivation process.
– Functioning of a common goals determines leader follower relationship.
 NECESSITY

Motivating Employees.
Creating Confidence.
Building Morale.
Developing Team Work.
Securing Group Effectiveness.
Counselling People.
STYLES OF LEADERSHIP
Autocratic Leadership
Participative Leadership
Free-rein Leadership

Autocratic Leadership
Authoritarian, directive or nomothetic style.
Ultra-utilization of power.
Result may be negative leadership.

Types of Autocratic Leadership

Strict Autocrat
Benevolent Autocrat
Incompetent Autocrat
Participative Leadership
Democratic, consultative or ideographic style.
Team building and goal sharing.
Consultation and participation of subordinates.
Decentralised decision - making process.

Free-rein Leadership
Super democratic style.
Policy of no intervention.
Manager’s only contribution in framing policy
programmes and limitation.
Manager only maintains a contact.
 Leadership Theories
Trait Theories.
Behavioural Theories.
Contingency Theories.
Situational Theories.
LMX Theory.
Leadership-participation Theory.
Path-Goal Theory.
 LEADERSHIP AS A CONTINUUM
Leadership in a practical world is between two
extremes of autocratic and free-rein.
Tannenbaum and Schmidt proposed a continuum
moving from authoritarian leadership behaviour to
free-rein.
Autocratic Free-rein
(boss centered (subordinate centered
leadership) leadership)

Use of authority by the

Manager

Area of freedom for

subordinates

Manager takes Manager presents ideas Manager presents Manager permits

decisions and and invities suggestions problems, gets subordinates of
announces suggestions and function within limits
makes decisions defined by superior
Manager sells Manager presents Manager defines
decisions tentative decision limits, asks groups to
subject to change make decision
 DIFFERENCES BETWEEN MANAGER AND LEADER

“Managers are people who do things right, and leaders are

people who do the right thing. Management’s efficiency lies
in climbing the ladder of success, leadership determines
whether the ladder s leaning against the right wall”.
Warren Bennis and Burt Nanus

LEADERSHIP MANAGEMENT
1. Leader leads people. 1. Manager manages things.
2. Leader can use his/her 2. Managers hold formal
informal influence. position.
3. Leaders create a vision and 3. Managers achieve results by
inspire others to achieve this directing the activities of
vision. others.
4. Leader processes non- 4. Manager enjoys formal
sanctioned influences ability. designated authority.
5. Leader inspires enthusiasm. 5. Manager engenders fear.
 Way to Effective Leadership
Finding the Leader in You
 Starting to Communicate
 Motivating People
 Expressing Genuine Interest in others
 Seeing Things from the Other Person’s point of view
 Listening to Learn
 Teaming up for Tomorrow
 Respecting the dignity of others
 Recognition, Praise, and Rewards
 Handling Mistakes, Complaints, and Criticism
 Setting Goals
 Focus and Discipline
Achieving Balance
Creating a Positive Mental Attitude
Learningnot to worry
The Power of Enthusiasm
 Organisational Change
“Organisational Change is the process by which
organisations move from their present state to some
desired future state to increase their effectiveness”
Gareth. R. Jones
Org Level Forces
Org structure Group level Forces
Org Cultureion Group Norms
Org Strategy & Group Cohesiveness
Over Determination Groupthink

Sources of
Change
Individual Level Forces
Cognitive Biases
Sub Unit Level Forces Uncertainty
Differences in Orientation Fear of Loss
Power & Conflict Selective Perception
Habit
Logical Reasons
 Planned & Unplanned Change
Planned change are the activities that are
intentional and goal oriented
First order change – Linear and Continuous
Second order change – that is multidimensional
multilevel, continuous and radical
Change Agents: Can be managers or non
managers, employees or consultants
Change agents can change structure,
technology, physical setting and people
 Force Field Analysis Model
Desired Restraining
Forces
Conditions

Restraining Driving
Forces
Forces
Restraining
Forces
Current Driving
Conditions Forces
Driving
Forces

Before During After

Change Change Change
 Resistance to Change

Nature of the Workforce

Technology

Economic Shocks
Forces for
Change Competition

Social Trends

World Politics
 Creating an Urgency for
Change
Inform employees about driving forces
Most difficult when organization is doing
well
Must be real, not contrived
Customer-driven change
– Adverse consequences for firm
– Human element energizes employees
 Minimizing Resistance to
Change
CommunicationHighest priority and first
strategy for change
Improves urgency to
change
Reduces uncertainty
(fear of unknown)
Problems -- time
consuming and costly
 Minimizing Resistance to
Change
Communication Increases ownership of
change
Training
Helps saving face and
Employee reducing fear of unknown
Involvement
Includes task forces,
search conferences
Problems -- time-
consuming, potential
conflict
 Minimizing Resistance to
Change
Communication When communication,
training, and involvement
Training do not resolve stress
Employee Potential benefits
Involvement – More motivation to change
– Less fear of unknown
Stress
Management – Fewer direct costs
Problems -- time-
consuming, expensive,
doesn’t help everyone
 Minimizing Resistance to
Change
Communication

Training When people clearly lose

something and won’t
Employee otherwise support change
Involvement
Influence by exchange--
Stress
Management reduces direct costs
Problems
Negotiation
– Expensive
– Increases compliance, not
commitment
 Minimizing Resistance to
Change
Communication

Training
When all else fails
Employee
Involvement Assertive influence
Stress Firing people -- radical
Management form of “unlearning”
Negotiation Problems
– Reduces trust
Coercion – May create more subtle
resistance
 Refreezing the Desired
Conditions
Realigning organizational systems and
team dynamics with the desired changes
– Alter rewards to reinforce new behaviours
– Feedback systems
Help employees learn how they are doing
Provide support for the new behaviour
patterns
 Strategic Vision & Change
Need a vision of the
desired future state
Minimizes employee fear
of the unknown
Clarifies role perceptions
 Change Agents
Anyone who possesses
enough knowledge and
power to guide and facilitate
the change effort
Change agents apply
transformational leadership
– Help develop a vision
– Communicate the vision
– Act consistently with the vision
– Build commitment to the vision
Successfully Diffusing Change
Successful pilot project
Receives visibility
Top management support
Labour union involvement
Diffusion strategy described clearly
Pilot project people moved to other areas
Action Research Philosophy
Change needs both action and
research focus
Action orientation
– Solve problems and change the
organizational system
Research orientation
– Concepts guide the change
– Data needed to diagnose problem,
identify intervention, evaluate change
Action Research Process
Establish
Client-
Consultant
Relations

Diagnose Evaluate/
IntroAduce
Need for Stabilize
Change
Change Change

Disengage
Consultant’s
Services
Appreciative Inquiry Philosophy
Directs the group’s attention
away from its own problems
and focuses participants on
the group’s potential and
positive elements.

Reframes relationships
around the positive rather
than being problem oriented Courtesy of Amanda Trotsen-Bloom
Appreciative Inquiry Process

Discovery Dreaming Designing Delivering

Forming Engaging in Developing

Discovering
ideas about dialogue objectives
the best of
“what might about “what about “what
“what is”
be” should be” will be”
 Parallel Learning Structure
Philosophy
Highly participative social structures
Members representative across the formal
hierarchy
Sufficiently free from firm’s constraints
Develop solutions for organizational
change which are then applied back into
the larger organization
Parallel Learning Structures
Parallel
Organization
Structure
 Cross-Cultural and Ethical
Concerns
Cross-Cultural Concerns
– Linear and open conflict assumptions different
from values in some cultures

Ethical Concerns
– Privacy rights of individuals
– Management power
– Individuals’ self-esteem
– Consultant’s role
 Communication
Communication may be understood as the process of
exchanging information and understanding between
people
Significance:
a. Control member behaviour
b. Fosters motivation
c. Provides Information
d. Changing people’s attitudes
e. Essence of social behaviour
f. Role in knowledge management Proemics

Types of Communication:
a. Verbal Kinesics
b. Non Verbal
c. Written
Para language
 Organisational Communication
Factors Influencing Organisational Communication
a. Formal channel of communication
b. Authority structure
c. Job specialisation
d. Information ownership
Communication Flows
a. Downward communication
b. Upward communication
c. Lateral communication
d. Diagonal communiaction
e. External communication
 Communication Networks
Wheel Network Chain Network Y Network
A A B
A

B
D E B

C C
C
D D
All Channel Network
A E
E A Circle Network

B
E E B

D C D C
 Communication Roles
a. Gatekeepers
b. Liasons
c. Isolates
d. Cosmopolites

Informal Communication ( Grapevine )

a. Chain System
b. Cluster System
c. Gossip Sustem
 Communication Process

Source
Message

Encoding F
E
Message E
D
Channel
B
Message A
C
Decoding
K
Message
Reciever
 Communication Barriers
Sender Related Barriers:
Communication Goals
Communication Skills
Interpersonal Sensitivity
Differing frames of reference
Improper Diction
Inconsistent Non – Verbal Signals
Fear
Sender Credibility
Receiver Related Barriers
Selective & Poor Listening
Evaluating the Source
Perceptions
Lack of responsive feedback
Meta communication
Situation Related Barriers:
a. Jargon
b. Information Overload
c. Time Pressure
d. Communication Climate
e. Noise
f. Distance
g. Mechanical Failure
h. Murphy’s Law of Communication

Overcoming the Barriers:

Sender’s Responsibility
a. Setting communication goals
b. Using appropriate language
c. Using empathic communication
d. Improving Coommunicator’s Credibility
e. Using face to face communication
f. Encouraging feedback
g. Using a correct amount of redundancy
h. Developing trusting climate
i. Using picture

Receiver's Responsibility:
a. Effective Listening ( Barriers to effective listening ):
i. Physiological Limitation
ii. Inadequate background information
iii. Selective memory
iv. Selective expectation
v. Fear of being influenced or persuaded
vi. Bias and pre judgment
vii. Selective perception
viii.Influence from emotions
ix. Avoiding evaluative judgement
x. Providing responsive feedback
 International OB
Trends in International Business
 International joint ventures, Multinational mergers &
Acquisitions and global strategic alliances
 More earning from international business than domestic
ABB, Honda, BP, Siemens, Motorola and Eastman kodak
functioning in more than 50 countries
 Most assets owned by different nationalities
 Trade volume growing since WW II from $51 Billion to $415
Billion in 1972 and since then $18 trillion till recent times
 Cultural Similarities & Differences
Cultural Norms, Values, cultural symbols, stories and rituals
vary from nation to nation
Americans Japanese Arabs
Belongingness Family Security
Freedom Group Harmony Family Harmony
Independence Collectiveness Parental Guidance
Self – Reliance Age / Seniority Age
Equality Group Consensus Authority
Individualism Cooperation Compromise
Competition Quality Devotion
Efficiency Patience Very Patient
Time Indirectness Indirectness
Directness Go Between Hospitality
Openness Interpersonal Friendship
Aggressiveness Hierarchy Formal/Admiration
Informality Continuation Past & Present
Future Orientation Conservative Religious Belief
Risk – Taking Information Tradition
Creativity Group Achievement Social Recognition
Self Accomplishment Success Reputation
Winning Relationship Friendship
Money Harmony with Nature Belongingness
Material Possessions Networking Family Network
Privacy
 Cultural Clusters
Anglo Latin American Arab
Australia Abu Dhabi
Argentina
Canada Bahrain
Chile
Ireland Kuwait
Columbia
New zealand Oman
Mexico
South Africa Saudi Arabia
Peru
UK UAE
Venezuela
USA Far Eastern
Latin European Hong Kong
Nordic Belgium Indonesia
Denmark France Malaysia
Finland Italy Philippines
Norway Portugal Singapore
Sweden Spain Taiwan
Thailand
Near Eastern Vietnam
Germanic
Austria
Greece Independent
Iran Brazil
Germany
Turkey India
Switzerland
Portugal Israel Japan
Spain
 HR Practices

• Hourly Wage rates in Mexico plays little role as it is

mandatory for the employers to pay wages for 365 days
• In Aus and Brazil employees get 1 month leave for one yr of
work
• In Japan seniority is the basis of promotions and
performance
• In UK maternity leave is 40 weeks 18 of these paid
•In sweden 87% of companies HR managers are on board of
directors
 Hofstede’s Cultural Dimension

• Power Distance – is the extent to which less powerful

members of institutions of and organizations accept that
power is distributed unequally
• Uncertainty Avoidance – is the extent to which people feel
threatened by ambiguous situations, and have certain beliefs
and institutions that try to avoid these
• Individualism – is the tendency of people to look after
themselves and their family
• Masculinity – refers to a situation in which the dominant
values in a society are success, money, and other material
things
• Cultural Diversity – Source of energy - can be great source
of energy and organizational effectiveness
 Motivation Across Cultures
American Japanese Arab
•Management Styles Leadership, Friendliness Persuasion, Coaching, Personal
Functional attention, Parenthood
Group activities
• Control Independence, Decision Of parents \
Making, Space, Time, Group Harmony parenthood
Money

• Emotional Appeal Opportunity Religion, Nationalistic,

Group Participation; Admiration
Company Success

•Recognition Individual Contribution Individual Status,

Group Identity, Belong Class\ society,
Ing to group Promotion

•Material Awards Salary, Commission, Gift for self\family

Profit – Sharing Annual Bonus, Social Family affair, salary
Services, Fringe increase
Benefits
•Threats Loss of Job Demotion
Out of Group

Competition; Risk Taking Reputation, Family

•Cultural Values Material Possession; Group harmony, security, Religion,
Freedom Achievement, Social Status
 Compensation Across Cultures
Japanese get paid more than three times the wages of other Asian
countries like Korea, Singapore, Taiwan
Korean & Japanese workers expect bonuses twice a year
In, Denmark more than 80% of employees belong to trade unions
In Germany a minimum 18 days paid annual leave is mandatory

In India
MNC employees are paid more for identical work
Distinction in salaries in different industries for identical works
Huge gaps between employees of organized and unorganized sectors
Distinction between salaries of public and private sector organizations
In Govt. sector salary gaps between different departments
 Assignments Choice Stock
Purchase
Customize
Core
Competitive Cash
Flexible Performance Based Base /Bonus
Schedules Employability
Work Challenges

Tax Benefit Choices

Base/ Bonus
Deferral Mix
MNC Pay Schedules
Phases of Cultural Adjustment
Phase 1 – Expatriate experiences range of emotions
Phase 2 – Crisis / Shock leading to negative appraisals
Phase 3 - Psychological adjustment for the expatriate
Phase 4 – Adjustment to the new environment
 Leadership across Cultures
Emotional Intelligence individual & social
1. Self Awareness National Context National Context
Culture influences Cultural Influences
2. Self Regulation
Worker needs and Worker Needs &
3. Motivation expectations Expectations
4. Empathy Subordinate
5. Social Skills Characteristics
Needs
Achievement
Motivation Leader Behaviors
Subordinate Motivation &Traits
Work Setting
Nature of tasks
Organizational structure National Context
Outcomes Nature of work group
Performance culture and
Satisfaction educational training
National Context define leader
Cultural institutions preferences for
Influence organizations behaviors and
and group structures traits
 Leadership Across Cultures
Universalism in Leadership
 Articulates a Vision
 Breaks from the Status Quo
 Provides goals and a plan
 Gives meaning or a purpose to goals
 Takes risks
 Is motivated to lead
Builds a power base
 Demonstrates high ethical and moral standards
Multicultural Teams
 Token Teams – One member from one culture
 Bicultural Teams – Members from two cultures
 Multicultural Teams – Members from three or more cultures
Managing Culturally Diverse Teams
 Task – related selection
 Establishing a vision
 Equalizing
 Negotiating Globally
When to Negotiate
Power
Value of Relationship Time Distribution
Strategy Commitment
Exchange Available Yours/Theirs
Sufficiently
Negot High Very Very
Important Low High
iate Important Low

Bargain

Take it
Un Un Very Very
or Low Low
Important Important Low High
Leave it
Steps in International Negotiations

Step 1
Preparation Negotiating Tactics
•Promise
Step 2 • Threat
Building the Relati • Recommendation
ship • Warning
•Reward
Step 3
Exchange of Infor • Punishment
mation and first offer • Normative Appeal
• Commitment
Step 4
Persuasion
• Self – Disclosure
• Question
Step 5 • Command
Concessions

Step 6
Agreement
 Communicating Across Cultures
 Language and Culture
1. High & Low Context Languages – in which people state
things directly and explicitly are low context language
and indirectly and implicitly is high context language
2. Use of Interpreters
3. Non – Verbal Communication – facial gestures, voice,
intonation, physical distance, smile, battling of eyelid,
kiss, handshake, and silence