....Rajarata University ,MBA 2010. Learning Portal....

rajarata university, mba, 2010,manoj alwis,



by  prof.W.M Jayaratyne and Mr.T.B Andarawewa










Additional Notes

Leadership and Organizational Behavior

Organizational Behavior (OB) is the study and application of knowledge about how people, individuals, and groups act in organizations. It does this by taking a system approach. That is, it interprets people-organization relationships in terms of the whole person, whole group, whole organization, and whole social system. Its purpose is to build better relationships by achieving human objectives, organizational objectives, and social objectives.

As you can see from the definition above, organizational behavior encompasses a wide range of topics, such as human behavior, change, leadership, teams, etc. Since many of these topics are covered elsewhere in the leadership guide, this paper will focus on a few parts of OB: elements, models, social systems, OD, work life, action learning, and change.

Elements of Organizational Behavior

The organization’s base rests on management’s philosophy, values, vision and goals. This in turn drives the organizational culture which is composed of the formal organization, informal organization, and the social environment. The culture determines the type of leadership, communication, and group dynamics within the organization. The workers perceive this as the quality of work life which directs their degree of motivation. The final outcome are performance, individual satisfaction, and personal growth and development. All these elements combine to build the model or framework that the organization operates from.

Models of Organizational Behavior

There are four major models or frameworks that organizations operate out of, Autocratic, Custodial, Supportive, and Collegial:

  • Autocratic — The basis of this model is power with a managerial orientation of authority. The employees in turn are oriented towards obedience and dependence on the boss. The employee need that is met is subsistence. The performance result is minimal.

  • Custodial — The basis of this model is economic resources with a managerial orientation of money. The employees in turn are oriented towards security and benefits and dependence on the organization. The employee need that is met is security. The performance result is passive cooperation.
  • Supportive — The basis of this model is leadership with a managerial orientation of support. The employees in turn are oriented towards job performance and participation. The employee need that is met is status and recognition. The performance result is awakened drives.
  • Collegial — The basis of this model is partnership with a managerial orientation of teamwork. The employees in turn are oriented towards responsible behavior and self-discipline. The employee need that is met is self-actualization. The performance result is moderate enthusiasm.

Although there are four separate models, almost no organization operates exclusively in one. There will usually be a predominate one, with one or more areas over-lapping in the other models.

The first model, autocratic, has its roots in the industrial revolution. The managers of this type of organization operate mostly out of McGregor’s Theory X. The next three models begin to build on McGregor’s Theory Y. They have each evolved over a period of time and there is no one best model. In addition, the collegial model should not be thought as the last or best model, but the beginning of a new model or paradigm.

Social Systems, Culture, and Individualization

A social system is a complex set of human relationships interacting in many ways. Within an organization, the social system includes all the people in it and their relationships to each other and to the outside world. The behavior of one member can have an impact, either directly or indirectly, on the behavior of others. Also, the social system does not have boundaries… it exchanges goods, ideas, culture, etc. with the environment around it.

Culture is the conventional behavior of a society that encompasses beliefs, customs, knowledge, and practices. It influences human behavior, even though it seldom enters into their conscious thought. People depend on culture as it gives them stability, security, understanding, and the ability to respond to a given situation. This is why people fear change. They fear the system will become unstable, their security will be lost, they will not understand the new process, and they will not know how to respond to the new situations.

Individualization is when employees successfully exert influence on the social system by challenging the culture.

The quadrant shown below shows how individualization affects different organizations (Schein, 1968):

Organization Development

Organization Development (OD) is the systematic application of behavioral science knowledge at various levels, such as group, inter-group, organization, etc., to bring about planned change (Newstrom, Davis, 1993). Its objectives is a higher quality of work-life, productivity, adaptability, and effectiveness. It accomplishes this by changing attitudes, behaviors, values, strategies, procedures, and structures so that the organization can adapt to competitive actions, technological advances, and the fast pace of change within the environment.

There are seven characteristics of OD (Newstrom, Davis, 1993):

  1. Humanistic Values: Positive beliefs about the potential of employees (McGregor’s Theory Y).
  2. Systems Orientation: All parts of the organization, to include structure, technology, and people, must work together.
  3. Experiential Learning: The learners’ experiences in the training environment should be the kind of human problems they encounter at work. The training should NOT be all theory and lecture.
  4. Problem Solving: Problems are identified, data is gathered, corrective action is taken, progress is assessed, and adjustments in the problem solving process are made as needed. This process is known as Action Research.
  5. Contingency Orientation: Actions are selected and adapted to fit the need.
  6. Change Agent: Stimulate, facilitate, and coordinate change.
  7. Levels of Interventions: Problems can occur at one or more level in the organization so the strategy will require one or more interventions.

Quality of Work Life

Quality of Work Life (QWL) is the favorableness or unfavorableness of the job environment (Newstrom, Davis, 1993). Its purpose is to develop jobs and working conditions that are excellent for both the employees and the organization. One of the ways of accomplishing QWL is through job design. Some of the options available for improving job design are:

  • Leave the job as is but employ only people who like the rigid environment or routine work. Some people do enjoy the security and task support of these kinds of jobs.
  • Leave the job as is, but pay the employees more.
  • Mechanize and automate the routine jobs.
  • And the area that OD loves — redesign the job.

When redesigning jobs there are two spectrums to follow — job enlargement and job enrichment. Job enlargement adds a more variety of tasks and duties to the job so that it is not as monotonous. This takes in the breadth of the job. That is, the number of different tasks that an employee performs. This can also be accomplished by job rotation.

Job enrichment, on the other hand, adds additional motivators. It adds depth to the job — more control, responsibility, and discretion to how the job is performed. This gives higher order needs to the employee, as opposed to job enlargement which simply gives more variety. The chart below illustrates the differences (Cunningham & Eberle, 1990

Action Learning

An unheralded British academic was invited to try out his theories in Belgium — it led to an upturn in the Belgian economy. “Unless your ideas are ridiculed by experts they are worth nothing,” says the British academic Reg Revans, creator of action learning.

Action Learning can be viewed as a formula: [L = P + Q]:

  • Learning (L) occurs through a combination of
  • programmed knowledge (P) and
  • the ability to ask insightful questions (Q).

Action learning has been widely used in Europe for combining formal management training with learning from experience. A typical program is conducted over a period of 6 to 9 months. Teams of learners with diverse backgrounds conduct field projects on complex organizational problems that require the use of skills learned in formal training sessions. The learning teams then meet periodically with a skilled instructor to discuss, analyze, and learn from their experiences.

Revans basis his learning method on a theory called System Beta, in that the learning process should closely approximate the scientific method. The model is cyclical — you proceed through the steps and when you reach the last step you relate the analysis to the original hypothesis and if need be, start the process again. The six steps are:

  1. Formulate Hypothesis (an idea or concept)
  2. Design Experiment (consider ways of testing truth or validity of idea or concept)
  3. Apply in Practice (put into effect, test of validity or truth)
  4. Observe Results (collect and process data on outcomes of test)
  5. Analyze Results (make sense of data)
  6. Compare Analysis (relate analysis to original hypothesis)

Note that you do not always have to enter this process at step 1, but you do have to complete the process.

Revans suggest that all human learning at the individual level occurs through this process. Note that it covers what Jim Stewart (1991) calls the levels of existence:

  • We think — cognitive domain
  • We feel — affective domain
  • We do — action domain

All three levels are interconnected — e.g. what we think influences and is influenced by what we do and feel.


In its simplest form, discontinuity in the work place is change, Knoster, Villa, 2000).

Our prefrontal cortex is a fast and agile computational device that is able to hold multiple threads of logic at once so that we can perform fast calculations. However, it has its limits with working memory in that it can only hold a handful of concepts at once, similar to the RAM in a PC. In addition, it burns lots of high energy glucose (blood sugar), which is expensive for the body to produce. Thus when given lots of information, such as when a change is required, it has a tendency to overload and being directly linked to the amygdala (the emotional center of the brain) that controls our fight-or-flight response, it can cause severe physical and psychological discomfort. (Koch, 2006)

Our prefrontal cortex is marvelous for insight when not overloaded. But for normal everyday use, our brain prefers to run off its hard-drive — the basal ganglia, which has a much larger storage area and stores memories and our habits. In addition, it sips rather than gulps food (glucose).

When we do something familiar and predictable, our brain is mainly using the basal ganglia, which is quite comforting to us. When we use our prefrontal cortex, then we are looking for fight, flight, or insight. Too much change produces fight or flight syndromes. As change agents we want to produce insight into our learners so that they are able to apply their knowledge and skills not just in the classroom, but also on the job.

And the way to help people come to insight is to allow them to come to their own resolution. These moments of insight or resolutions are called epiphanies — sudden intuitive leap of understanding that are quite pleasurable to us and act as rewards. Thus you have to resist the urge to fill in the entire picture of change, rather you have to leave enough gaps so that the learners are allowed to make connections of their own. Doing too much for the learners can be just as bad, if not worse, than not doing enough.

Doing all the thinking for learners takes their brains out of action, which means they will not invest the energy to make new connections.

Top of Form

Bottom of Form

Organizational Behavior

The PhD Program in Organizational Behavior at the Graduate School of Business emphasizes preparation for careers in scholarly research. Graduates of the Program usually pursue careers in academic or research institutions.

A variety of social science disciplines and topic areas are relevant to the study of human behavior in organizational settings. A distinguishing feature of Stanford’s PhD Program in Organizational Behavior is the broad interdisciplinary training it provides. The field is often broken down into two broad subareas.

Micro Organizational Behavior

The study of how individuals and groups affect and are affected by organizations. Drawing primarily on psychology, this area includes such topics as cognition, decision making, learning, motivation, negotiation and bargaining, cooperation and altruism, emotions, impressions management, group processes, stereotyping and injustice, power and influence.

There is also a formal institutional link between the behavioral side of marketing and the micro side of OB, which is called Behavioral Interest Group. The GSB Behavioral Lab links this group. This lab fosters collaborative work among the behavioral people across field boundaries.

Macro Organizational Behavior: Organizational Theory and Economic Sociology

Dedicated to training students who will be leading researchers in the fields of organizational theory and economic sociology.  Our faculty members are among the foremost scholars dedicated to bringing a sociological approach to the study of organizations and markets.  The training provides a deep grounding in the study of organizations as social systems; the dynamics of change in organizations, industries and markets; and the relationships between organizations and their environments.  Faculty study a range of topics, ranging from the role of identity in organizational processes; change in cultural categories and markets; social movements and their influence on firms and markets; firm strategies and the effects of long-run histories of strategic interaction; the impact of workforce demographic change and labor market inequality; organizational learning processes; social networks; and entrepreneurship and firm formation processes.

Doctoral students in the program benefit from their interactions in the broader inter-disciplinary environment of the GSB, as well as from Stanford University’s long-standing strength in the study of organizations and economic sociology.  Strong relations with the Department of Sociology mean that students can build their careers on the foundation of strong disciplinary training in sociology.  The doctoral program places a heavy emphasis on training students through active engagement in empirical research; students work closely with faculty starting in the first year, in addition to developing their own, independent research projects.  In addition to formal seminars with invited presenters, an informal weekly “Macro Lunch” provides a forum for the exchange of ideas and advice related to research in progress by both faculty and students.

Unique Aspects of the Stanford Program

The interdisciplinary resources available to students in the Stanford program are unique. The faculty of the Graduate School of Business have a reputation for excellence in fields such as accounting; economics; finance; marketing; and operations, information, and technology. Doctoral students in the organizational behavior program have frequent contact with faculty and students in these fields, many of whom show an interest in topics germane to organizational behavior.

A second source of interdisciplinary contact is colloquia presented by visiting scholars, seminars, off-campus conferences, and many other informal opportunities for interaction between faculty and students. The result is intellectual stimulation and active research collaboration across traditional disciplinary boundaries – a phenomenon that is unfortunately rare, yet obviously essential to the study of organizations.

Interdisciplinary contact is a natural extension of the fact that Stanford University as a whole emphasizes interdisciplinary cooperation. Cross-registration in courses, access to faculty, and participation in colloquia are encouraged by such Stanford departments as Psychology, Statistics, and Sociology. Students in the Organizational Behavior PhD Program have ease of access to a unique range of interdisciplinary resources. The GRE is required for admission.

A small number of students are accepted into the field each year, with a total of about 19 organizational behavior students in residence. Student-faculty relationships are close, both professionally and socially. This permits the tailoring of the program of study to fit the background and career goals of the individual.

Preparation and Qualifications

All students are required to have, or to obtain during their first year, mathematical skills at the level of one course each of calculus and linear algebra, probability, and mathematical statistics.

Cognitive Framework

Cognitive approach emphasizes the positive and freewill aspects of human behavior and uses concepts such as expectancy, demand, and intention.  Cognition can be simply defined as the act of knowing an item of information.  In cognitive framework, cognitions precede behavior and constitute input into the person’s thinking, perception, problem solving, and information processing.

The work of Edward Tolman can be used to represent the cognitive theoretical approach. According to Tolman, learning consists of the expectancy that a particular event will lead to a particular consequence. This cognitive concept of expectancy implies that organism is thinking about, or is conscious or aware of the goal and result of a behavior exhibited by it. It means that a person desires a goal and also knows the behavior that will lead to achievement of the goals.

In the subject of organizational behavior, cognitive approach dominates the units of analysis such as perception, personality and attitudes, motivation, behavioral decision making and goal setting.

Behavioristic Framework

Pioneer behaviorists Ivan Pavlov and Jon B. Watson stressed the importance of studying observable behaviors instead of the elusive mind. They advocated that behavior could be best understood in terms of stimulus and response (S-R). They examined the impact of stimulus and felt that learning occurred when the S-R connection was made. Modern behaviorism, that marks its beginning with B.F. Skinner, advocates that behavior in response to a stimulus is contingent on environmental consequences.  Thus, it is important to note that behaviortistic approach is based on observable behavior and environmental variables (which are also observable).

Social Cognitive Framework

Social learning theory takes the position that behavior can best be explained in terms of a continuous reciprocal interaction among cognitive, behavioral, and environmental determinants. The person and the environmental situation do not function as independent units but, in conjunction with behavior itself, reciprocally interact to determine behavior.  It means that cognitive variables and environmental variables are relevant, but the experiences generated by previous behavior also partly determine what a person becomes and can do, which, in turn, affects subsequently behavior. A persons cognition or understanding changes according to the experience of consequences of past behavior.

Bandura developed social learning theory into the more comprehensive social cognitive theory (SCT).  Stajkovic and Luthans have translated this SCT into the theoretical framework for organizational behavior. Social cognitive theory recognizes the importance of behaviorism’s contingent environmental consequences, but also includes cognitive processes of self regulation. The social part acknowledges the social origins of much of human thought and action (what individual learns from society), whereas the cognitive portion recognizes the influential contribution of thought processes to human motivation, attitudes, and action.

In social cognitive theoretical framework, organizational participants are at the same time both products and producers of their personality, respective environments, and behaviors.  The participants as a group of produce the environment, every individual is a product of the enironment and through his behavior changes the environment for others as well as for himself, every individual is a product of his personality, but also influences his personality as consequence of results of his behavior.

Bandura identified five basic human capabilities as a part of SCT.

1.     Symbolizing: People process visual


into cognitive models. They help in future action.

2.     Forethought: Employees plan their



3.     Observational: Employees learn


observing the performance of the referent  group (peers, supervisors and high performers) and the consequences of their actions.

4.     Self-regulatory: Employees self regulate their actions by setting internal standards (aspired level of performance).

5.     Self-reflective: Employees reflect back on their actions (how did I do?) and perceptually determine how they believe then can successfully accomplish the task in the future given the context (probability of success between 0 to 100% is estimated)

An ordinary way to distinguish among effectiveness, efficacy, and efficiency:

  • efficiency: doing things in
  • the most economical way (good input to output ratio)efficacy: getting things done, i.e. meeting targets
  • effectiveness: doing “right
  • ” things, i.e. setting right targets to achieve an overall goal (the effect)
  • (effectivity: synonymous
  • to effectiveness; usage is rather rare)

Effectiveness means the capability of producing an effect.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: