CHAPTER 1

Organizational Behavior - The study of what people think, feel, and do in and around organizations.

Organizations - Groups of people who work interdependently toward some purpose. They expect

each other to complete certain tasks in a coordinated way.

WHY STUDY OB?- To apply marketing, accounting, etc, you need to understand, predict, and

influence behavior (both ours and others)- Much of our time is spent working in or around orgs, OB theories are particularly

helpful in satisfying this innate drive to make sense of the workplace (understand and predict the world we live in).

- Gives you the opportunity to question and rebuild your personal mental models that have developed through observation and experience.

- Need to influence other people in orgs. OB helps to help u perform you r job and working more effectively w others.

- Important for company’s financial health. (3x better) (higher financial and long-term stock market performance for ‘the best place to work’).

No longer for ‘managers’ only, all of us need to manage ourselves especially since companies have removed many layers of management and delegate more responsibilities. Everyone is a manager.

OB TRENDS1. Globalization

- Economic, social, and cultural connectivity and interdependence with people in other parts of the world.

- Benefits: larger markets, lower costs, greater access to knowledge and innovation, help developing countries, work intensification

- Disadvantage: may reduce work security for developing countries.

OB: OB researchers are examining how leadership, influence, conflict, and other OB topics vary across cultures.

2. The Changing WorkforceTakes many forms, but the three most prominent ones are:

- Race/ethnicity- Women in the workforce – half of the paid workforce, doubled since a decade ago- Generational diversity

o Baby boomers (1946-1964) – expect and desire more job security and more intent on improving their economic and social status.

o Generation X (1965-1979) – less job security and more motivated by workplace flexibility, opportunity to learn (new techs), and working in an egalitarian and ‘fun’ orgs.

o Generation Y (>1979) – self-confident, optimistic, adept in multitasking, more independent than Gen X.

Different generations have different values and expectations, benefits:- Directly, companies are more likely to understand their diverse customers better.- Indirectly:

o Increase the pool of talented applicantso Reduce employee turnovero Improve on decision making and team performance on complex taskso At the same time, it presents new challenges: conflicts,

miscommunication, discrimination in orgs and society.

3. Evolving Employment RelationshipGlobalization and change in the workforce are two causes of the evolution in employment relationship.

Today, employers demand more workforce flexibility to remain competitive:- most have shifted to employability – an employment relationship in which people

are expected to continuously develop their skills to remain employed.- Greater use of contingent work – any job in which individual does not have an

explicit or implicit contract for long-term employment, or one in which the minimum hours of work can vary in a nonsystematic way (ex: temporary or seasonal work, freelance, etc)

Adapting to emerging workforce expectationsTo adapt, employees are demanding and receiving:

- Work/life balance – the minimization of conflict between work and non-work demands (today, it is a must-have, especially for Gen X and Y). One of the most important indicators of young employee’s career success.

- More egalitarian and fun workplaces.

4. Virtual Work- Virtual work – employees perform work away from the traditional physical

workplace using IT.- Teleworking or Telecommuting – working at home rather than commuting to

the office.- Nearly 20% of Americans work at home at least one day each month.

Benefits:- reduce employee stress- increases productivity and job satisfaction- makes employees feel more empowered

Disadvantages:- loneliness and lack of recognition- work/family stress if they lack sufficient space and resources for a home office.

5. Workplace Values and EthicsSine qua non (essential element) of org excellence.

Values – stable, long-lasting beliefs about what is important in a variety of situations.- evaluative standard of what is right or wrong, good or bad; dictate our priorities,

preferences and desires; influence our motivation and decision.- Personal values and Shared values.

Importance of Values in the workplace. OBRecently become popular:

- Today’s workforce rejects ‘command-and-control.’ Leaders turn to values as a more satisfactory approach to keeping employees’ decisions and actions aligned w corporate goals.

- Globalization has raised our awareness of and sensitivity to culture differences in values and beliefs. Creates an increasing challenge to ID a set of core values acceptable to employees around the world.

- Organizations are under increasing pressure to engage in ethical practices and corporate social responsibility.

Ethics – the study of moral principles or values that determine whether actions are right or wrong and outcomes are good or bad.

Corporate Social Responsibility (CSR)- An organization’s moral obligation toward its stakeholders. - Triple bottom line: earn positive returns in the economic, social, and

environmental spheres of sustainability.

THE FIVE ANCHORS OF OBThe field of OB relies on a set of basic conceptual anchors that guide our thinking about orgs and how to study them:

1. The Multidisciplinary Anchor- Field should borrow knowledge from other disciplines, not just from its own

isolated research base.- Exs: psychological research has aided our understanding of individual and

interpersonal behavior.- Sociologists have contributed to our knowledge of team dynamics, organizational

socialization, organizational power, and other aspects of the social system.- communications, marketing and IS- OB has suffered from trade-deficit – importing far more knowledge from other

disciplines than exporting its own.

2. The Systematic Research Anchor- OB research should rely on scientific method – a set of principles and procedures

that help researches to systematically understand previously unexplained events and conditions

- Forming research questions, systematically collecting data, testing hypotheses.- Relies mainly on quantitative (numerical) data.- To minimize personal biases.- Recently, OB knowledge has also developed through qualitative research

methods: open-ended interviews, observation in the workplace, etc.

3. The Contingency Anchor- Contingency approach – the idea that a particular action may have different

consequences in different situations. - No single solution is best for all circumstances,- When faced with a particular problem or opportunity, we need to understand and

diagnose the situation and select the strategy most appropriate under those conditions.

4. The Multiple Levels of Analysis Anchor- Three levels of analysis: individual, team, organization.- OB topic relates to multiple levels, so try to think about each OB topic at the

individual, team, and organizational levels, not just at one of these levels.

5. The Open Systems Anchor- OB view orgs as open systems – orgs that take their sustenance from the

environment and, in turn, affect that environment through their output.- Orgs are living organisms whose survival and success depends on how well

employees sense environmental changes and alter their patterns of behavior to fit those emerging conditions.

- Never closed systems, but monopolies come close. - Traditionally focused on physical resources and goods, not of the new economy,

where the most valued input is knowledge.

Check out Exhibit 1.3 “open systems view of organizations” page 12.

KNOWLEDGE MANAGEMENTKnowledge management – any structured activity that improves an organization’s capacity to acquire, share, and use knowledge in ways that improve its survival and success.

Intellectual capital – the sum of an organization’s human, structural, and relationship capital, that gives it competitive advantage.

- Human capital- Structural capital – organization’s systems and structures. The knowledge that

remains after all the human capital has gone home.

- Relationship capital – org’s relationships with customers, suppliers, and other external stakeholders who provide added value for the orgs. Ex: customer loyalty and mutual trust w the suppliers.

Knowledge management processesOrganizational Learning – the knowledge management process in which organizations acquire, share, and use knowledge to succeed:

- Knowledge acquisition.o Fastest and powerful is by hiring individuals or acquiring entire

companies. - Knowledge sharing.

o How well knowledge is distributed. o Computer intranets – often marketed as complete ‘knowledge

management’ but it’s expensive to maintain. Also overlook the fact that lots of knowledge is difficult to document.

o Give employees more opportunities for informal online or face-to-face interaction.

- Knowledge use.

Organizational Memory- The storage and preservation of intellectual capital.- How?

o Keeping good employeeso Systematically transfer knowledge before employees leaveo Transfer knowledge into structural capital – bringing out hidden

knowledge, organizing it, and putting it in a form that can be available to others.

CHAPTER 2

MARS MODELThis model highlights the four factors affecting employees’ voluntary behavior and performance:

- Motivation - Ability- Role perception- Situational factor

Motivation The forces within a person that affect his or her direction, intensity, and persistence of voluntary behavior.

AbilityBoth the natural aptitudes (natural talents that help employees learn specific tasks more quickly and perform them better) and learned capabilities required to successfully complete a task.

Skills, knowledge, aptitudes, and others characteristics that lead to a superior performance are bunched into the concept of competencies. (the abilities, values, personality traits, and other characteristics of people that lead to superior performance).

Challenge: match people’s competencies with the competencies that each job requires:- Select applicants whose existing competencies best fit the required tasks.- Provide training so employees develop required skills and knowledge- Redesign the job so employees are only given tasks within their capabilities.

Role PerceptionTo improve RP: clear job description, ongoing training, clarify work together w employees over time, receive feedback.

Situational factorsThese are conditions beyond the employees’ immediate control that constrain or facilitate his or her behavior performance (consumer preferences and economic conditions).

TYPES OF INDIVIDUAL BEHAVIOR IN ORGANIZATIONS- Task performance – goal-directed behaviors under the individual’s control that support organizational objectives.

- Organizational citizenship – behaviors that extend beyond the employee’s normal job duties. “They will go the extra step, or maybe even the extra mile, to support the interest of the organization.”

- Counterproductive behaviors (CWBs) – abuse of others, threats, work avoidance (tardiness), work sabotage (doing work incorrectly), overt acts (thefts)

- Joining and staying with the organization – the probably reason why employees quit is because of ‘shock events,’ such as the boss’s unfair decision or colleague conflicts.

- Work attendance – situational factors like snow or car break down ok. Motivational is another factor.

VALUES IN THE WORKPLACEValues - stable, evaluative beliefs that guide our preferences for outcomes or courses of action in a variety of situations. Tells us what we ought to do.

Value system – people arrange values into a hierarchy of preferences.

Espoused values – values we say we use and we think we use. Enacted values – values we actually rely on to guide our decisions and actions. Apparent by watching people in action.

Types of valuesSchwartz’s values circumplex

- Openness to change (self-direction and simulation) – Conservation (tradition and security)

- Self transcendence (universalism and benevolence) – Self-enhancement (achievement and power).

Values and individual behaviorOur day to day behaviors are often different with our values. Reason being might be because values are abstract concepts that sound good in theory but hard to follow in real life.

Job sometimes requires us to be inconsistent with our values -> incongruence.

Values Congruence- a situation wherein two or more entities have similar value systems.

- Person-organization values of congruence: where personal values are congruent with the organizations.

o Employees feel less stress, more job satisfaction, loyal and their decisions are consistent with the orgs’ goals and missions.

- Espoused-enacted values congruence: how closely the values apparent in their actions (enacted values) are consistent with that they say they believe in (espoused). Noticeable gaps -> undermine a person’s perceived integrity.

- Compatibility of an organization’s dominant values with the prevailing values of the community or the society in which it conducts its business.

VALUES ACROSS CULTURESIndividualism and CollectivismIndividualism – the extent to which we value independence and personal uniqueness (value personal freedom, self-sufficiency, etc)

Collectivism – the extent to which we value our duty to groups to which we belong and group harmony (define themselves by their group membership and value harmonious relationships within those groups).

Power distanceIt is the extent that people accept unequal distribution of power in a society.

High power distance -> accept unequal power distribution. Obedience to authority and are comfortable receiving commands from superiors without debate.

Less power distance -> expect relatively equal power sharing.

Other cross-culture values- Uncertainty avoidance

o The degree to which people tolerate ambiguity (low uncertainty avoidance)

o Feel threatened by ambiguity and uncertainty (high uncertainty avoidance).

- Achievement-nurturing orientationo Reflects a competitive vs. cooperative view of relations w other peopleo High achievement orientation -> value assertiveness, competitiveness,

materialismo Nurturing orientation -> emphasize relationships and the well-being of

others

ETHICAL VALUES AND BEHAVIOREthics – study of moral principles or values that determine whether actions are right or wrong and outcomes are good or bad.

Three ethical principles- Utilitarianism – seek the greatest good for the greatest number of people.

o Sometimes known as the consequential principle because it focuses on the consequences of our actions not how we achieve them.

o Problem: impossible to evaluate the benefits and costs of many decisions (stakeholders have wide-ranging needs and values).

o Uncomfortable engaging in behaviors that seem unethical to attain results that are ethical.

- Individual rights – everyone has entitlements to act in certain way (freedom of movement, speech ,physical security, fair trial, etc).

o Problem: certain individual rights may conflicted with others’

- Distributive justice principle – people who are similar should receive similar treatment, and vice versa.

o Problem: it’s difficult to agree on who is ‘similar’ and what factors are ‘relevant.’

Moral intensity, ethical sensitivity, and situational influencesMoral intensity – the degree to which an issue demands the application of ethical principles.

Ethical sensitivity -> personal characteristic that enables people to recognize the presence and determine the relative importance of an ethical issue.

Situational influences -> employees may feel pressured by their employees and so they lie to customers etc. they do not justify unethical conduct, rather we need to recognize these factors so orgs can reduce their influence in the future.

PERSONALITY IN ORGANIZATIONSPersonality – the relatively stable pattern of behaviors and consistent internal states that explain a person’s behavioral tendencies.

The Big Five Personality DimensionsHandy acronym: CANOE:

- Conscientiousness – careful, dependable, responsible, self-disciplined.- Agreeableness – courteous, good-natured, empathic, caring. ‘friendly

compliance’ vs. ‘hostile noncompliance’- Neuroticism – high: high levels of anxiety, hostility, depression, self-

consciousness. Low: calm, posed, secure- Openness to experience: sensitive, flexible, creative and curious.- Extroversion – outgoing talkative, sociable, assertive.

Persons with high emotional stability work better than high-stressor

MBTI- Sensing/Intuition

o Sensing: organized structure to acquire factual and preferable quantitative details.

o Intuition: collect info non-systematically.- Thinking/feeling

o Thinking: cause-effect logic and scientific method to make decisions. Objectively and unemotionally

o Feeling: weigh options against personal values than rational logic.- Judging/perceiving

o Judging: enjoy the control of decision making and want to resolve problems quickly

o Perceiving: flexible, spontaneously adapt to events as they unfold and what to keep their options open.

CHAPTER 3PERCEPTIONS AND LEARNING IN ORGANIZATIONS

Perception: the process of selecting, organizing, and interpreting information in order to make sense of the world around us.

THE PERCEPTUAL PROCESSSelective attention: the process of filtering information received by our senses.

- Affected by characteristics of the objects being perceived and of the individual doing the perceiving.

- Gets noticed because of: size, intensity, motion, repetition, novelty, and our expectations.

Perceptual Organization and InterpretationCategorical thinking: the most unconscious process of organizing people and objects into preconceived categories that are stored in our long-term memory.

- Occurs w/o our awareness (ex: filling in missing pieces of situations (closure)) or conceptually group people together based on the similarity to others.

- We have natural tendencies to see patterns- Making sense also involves in interpreting information.

Mental models: the broad worldviews or ‘theories-in-use’ that people rely on to guide their perceptions and behaviors.

- May causes us to overlook important information in the selective attention process. .

SOCIAL IDENTITY THEORYSocial ID theory: states that self perception and social perception are shaped by a person’s unique characteristics (personal ID) and membership in various social groups (social ID).

- Personal ID: characteristics that make a person unique and distinct- Social ID: how people define themselves in terms of groups they belong to and

have an emotional attachment.

Perceiving others through Social ID

Social perception: how we perceive others; influenced by:- Categorization - categorizing people into distinct groups.- Homogenization - people within each group are similar to each other.- Differentiation - assigning more favorable characteristics to people in our groups

than to people in other groups.

STEREOTYPING IN ORG SETTINGSStereotyping: the process of assigning traits to people based on their membership in a social category.

Has 3 elements:- First, we develop social categories and assigns traits that are difficult to observe.- Second, we assign people to one or more social categories based on easily

observable info about them (gender, appearance, physical location)- Third, people who seem to belong to the stereotyped group are assigned non-

observable traits associated with the group.

Occurs for 3 reasons:- It’s a form of categorical thinking –energy saving process to simply understand

our world.- We have innate drive to understand and anticipate how others behave.- We are motivated to rely on negative stereotypes when others threaten our self-

esteem.

Problems with Stereotyping- Lays the foundation of discrimination behavior.- Mostly occurs as unintentional (systemic) discrimination – decision makers rely

on stereotypes to establish notions of the ‘ideal’ person in specific roles. - Intentional discrimination – people hold unfounded negative emotions and

attitude toward people belonging to a particular stereotyped group.

ATTRIBUTION THEORYAttribution process: perceptual process of deciding whether behaviors or events are caused by internal or external factors.

Attribution ErrorsBiases:

- Fundamental attribution error: tendency to attribute others’ behavior more to internal factors rather than external.

- Self-serving bias: attribute our favorable outcomes internally, attribute failure externally.

SELF-FULFILLING PROPHECYSelf-fulfilling prophecy: when our expectations on other person cause that person to act accordingly. Can influence reality.

Four steps in self-fulfilling prophecy process:- Expectations formed- Behavior towards the employee- Effects on the employee- Employee behavior and performance

Contingencies of self-fulfilling prophecies- leaders need to develop and maintain a positive, yet realistic, expectation towards

all employees.

- This recommendation is consistent w positive OB philosophy -> focusing on the positive rather than the negative will improve org success and individual well-being.

IMPROVING PERCEPTIONSMeaningful Interaction

- The more we interact with each other in the meaningful way, the less we rely on stereotypes.

- Participants must have a close and frequent interaction working towards a shared goal where they need to rely on each other (cooperate rather than compete).

- Should have equal status- Improves empathy (a person’s ability to understand and sensitive to others’

feelings, thoughts, and situations) towards others.

Mutual Understanding: Johari WindowThe model of personal and interpersonal understanding that encourages disclosure and feedback to increase the open are and reduce the blind, hidden, and unknown areas to oneself.

- Open area. Known to both.- Blind. Known to others.- Hidden. Known to you.- Unknown. Unknown to both.

Main objective: increase the size of open area. Ways:- Disclosure – informing others of your beliefs, feelings, and experiences- Feedback

LEARNING IN ORGANIZATIONSLearning: a relatively permanent change in behavior that occurs as a result of a person’s interaction with the environment.

Tacit knowledge: knowledge embedded in our actions and ways of thinking, and transmitted only trough observation and experience.

BEHAVIOR MODIFICATION: LEARNING THROUGH REINFORCEMENTBehavior modification (operant conditioning and reinforcement theory): learning in terms of antecedents and consequences of behavior (completely dependent on the environment).

A-B-Cs of Behavior modificationChange (B) behavior by managing its (A) antecedents and (C) consequences. Mainly focuses on the consequences.

Contingencies of ReinforcementContingencies of reinforcement (four types of consequences that strengthen, maintain, or weaken behavior):

- Positive reinforcement – the intro of a consequences increases or maintains- Punishment - decreases- Negative reinforcement – the removal or avoidance of a C increases or maintains- Extinction – decreases a behavior because no consequences follow it.

Schedules of reinforcement: - For new task – continuous reinforcement (every time).- For learned behavior – variable ratio schedule (reinforced after a variable number

of times).

SOCIAL LERNING THEORY: LEARNING BY OBSERVINGSocial learning theory: learning that occurs by observing others and then modeling the behaviors that lead to favorable outcomes and avoiding the behaviors that lead to punishing consequences.

- Behavior modeling. – by observing behaviors and practice them: tacit knowledge and skills are mainly acquired by this.

- Learning behavior consequences. – through logic and observation not just direct experience.

- Self reinforcement – whenever someone has control over a reinforcer but delays it until a self-set of goals has been completed.

LEARNING THROUGH EXPERIENCEKolb’s experiential learning model:

- Concrete experience – sensory and emotional engagement in some activity.- Reflective observation – listening, watching, recording and elaborating an

experience- Abstract conceptualization – we develop concepts and integrate our observation

into logically sound theories.- Active experimentation – when we test our previous experience, reflection, and

conceptualization in a particular context.

Learning works best in organizations with a strong learning orientation:- The extent that an organization or individual supports knowledge management,

particularly opportunities to acquire knowledge through experience and experimentation.

Action learning: when employees, usually in teams, investigate and apply solutions to a situation that is both real and complex, with immediate relevance to the company.

CHAPTER 4WORKPLACE EMOTIONS, ATTITUDES, STRESS

EMOTIONS IN THE WORKPLACEEmotions: physiological, behavioral, and psychological episodes experienced toward an object, person, or event that create a state of readiness.

Attitudes: the cluster of beliefs, assessed feelings, and behavioral intentions toward an object.

Attitudes are judgments (we think about it), emotions are experience (w/o awareness).

Attitudes has 3 components:- Beliefs – the established perceptions about the attitude object (from past

experience or other forms of learning).- Feelings – represents your + or – evaluations of the attitude object.- Behavioral intentions – your motivation to engage in a particular behavior w

respect to the attitude object.

The more we have positive emotions, the more we form positive attitudes towards the targets of those emotions.

People have direct behavioral reactions to emotions.

Cognitions vs. emotionsWe should pay attention to both the cognitive and emotional side of the attitude model and hope they agree w each other most of the time.

Cognitive dissonance: inconsistency between their beliefs, feelings, and behavior. - Causes us to change one or more of these elements.- Behavior is the hardest to change- We usually change our beliefs or feelings to reduce the inconsistency.

MANAGING EMOTIONS AT WORKEmotional labor: the effort, planning, and control needed to express organizationally desire emotions during interpersonal transactions.

- abide to display rules

Emotional Dissonance- The conflict between required and true emotions. - The larger it is, the more stress, job burnout, and psychological separation from

self (work alienation)- Those occurs when engaging in surface acting – modifying behavior to the

required emotions but continuing emotions to match the required emotions.

Emotional Intelligence: the ability to:- perceive and express emotion- assimilate emotion and thought- understand and reason with emotion- regulate emotion in oneself and others.

Has 4 dimensions:- Self-awareness. Having a deep understanding of one’s own emotions, strengths,

weaknesses, values, and motives.- Self-management. How well we control or redirect our internal states, impulses,

and resources. - Social awareness. Mainly about empathy.- Relationship management. Refers to managing other people’s emotions

(inspiring, influencing, developing others’ capabilities, managing change, resolve conflict, cultivating relationships, supporting teamwork and collaboration.

These four form hierarchy, self awareness requires lowest EI, relationship management requires highest.

JOB SATISFACTION- A person’s attitude regarding his or her job and work content.

Exit-Voice-Loyalty-Neglect (EVLN) model: the 4 ways employees respond to job dissatisfaction.

- Exit – quit, transfer, usually follows specific ‘shock events’- Voice

o any attempt to change, rather than escape. o constructive responses, recommending ways to management.o or can be confrontational such as filing formal grievances. o Extreme cases: display counterproductive behaviors to get attention.

- Loyalty – “suffer in silence” and wait to be resolved by others or by itself.- Neglect

o Reduce work efforto Paying less attention to qualityo Absent and late

Happy workers are more productive to some extent. - General attitudes (such as job satisfaction) don’t predict specific behaviors very

well.- Job performance leads to job satisfaction, not vice versa, but only when

performance is linked to valued rewards.

Job satisfaction-performance relationship is strongest in complex jobs, where employees have more freedom to perform their work or to slack off.

ORGANIZATIONAL (affective) COMMITMENT- The employee’s emotional attachment to, ID with, and involvement in a particular

organization. - Competitive advantage and customer satisfaction because long-tenure employees

have better knowledge- Can suppresses constructive conflict.

Along with it, employees have varying levels of continuance commitment:- A bond felt by an employee that motivates him to stay only because leaving

would be costly.- Lower performance

Employers need to win employee’s hearts (affective commitment) beyond tying them to the org (continuance commitment).

Building organizational commitmentStrategies:

- Justice and support. (Orgs fulfill their obligations to employees and abide by humanitarian values, such as fairness, courtesy, forgiveness, and moral integrity).

- Shared values (values are congruent)- Trust – a psychological state comprising the intention to accept vulnerability

based upon positive expectations of the intent or behavior of another person. o That’s why layoffs are a major blow to employee loyalty – reduced job

security, reduced trust.- Organizational comprehension – loyalty tends to increase w open and rapid

communication to and from corporate leaders, as well as w opportunities to interact with co-workers across the organization.

- Employee involvement – employees feel they are part of the org then they participate in decisions that guide the org’s future.

WORK-RELATED STRESS AND ITS MANAGEMENTStress: an individual’s adaptive response to a situation that is perceived as challenging or threatening to the person’s well-being.

Distress: the degree of physiological, psychological, and behavioral deviation from healthy functioning.

Eustress: activates and motivates people to achieve goals, change their environments, and succeed in life’s challenges.

General adaptation syndrome: a model of stress experience, consisting of 3 stages: alarm reaction, resistance, and exhaustion.

Stressor: the causes of stress, including any environmental conditions that place a physical or emotional demand on that person. 3 most prevalent stressors:

- Harassment and incivilityo Psychological harassment: repeated and hostile or unwanted conduct,

verbal comments, actions or gestures, which affect an employee’s dignity or psychological or physical integrity and that result in a harmful work environment for the employee.

o Sexual harassment: unwelcome conduct of a sexual nature that detrimentally affects the work environment or leads to adverse job-related consequences for its victims.

- Work overload o Working more hours and more intensely during those hours than they can

reasonably cope.o Caused by globalization and its demands for more work efficiency.o Culture

- Low task control – Coach and drivers: high responsibility, low task control (what happens in the field and traffic congestion).

Stress varies, due to:- Lifestyle- Different coping strategies- Level of resilience – the capability of individuals to cope successfully in the face

of significant change, adversity, or risk. o Workplace spirituality – investigates a person’s inner strength and how it

nurtures and is nurtured by the workplace. o Resilience is stronger when people have a sense of purpose and are in

touch w their personal values.

Managing work-related stress- Remove the stressor

o Assign employees to jobs that match their skills, reduce excessive noise, have a complaint system, corrective action against harassment, give more control over work process, work/life balance.

- Withdraw from the stressoro Taking days off, breaks, vacations, sabbaticals. Leisure times improve

employees’ ability to cope with stress.- Change stress perception

o Look at ways for employees to strengthen their confidence and self-esteem so that job challenges are not perceived as threatening. Humor.

- Control stress consequenceso Can reduce adverse C by having healthy lifestyle (onsite/offsite fitness

centre, relaxation or mediation)- Receive social support

o Improves the person’s resilience and provides information to help interpret, comprehend and possibly remove the stressor.

CHAPTER 5EMPLOYEE MOTIVATION: FOUNDATION AND PRACTICES

Motivation: the forces within a person that affect his or her direction, intensity, and persistence of voluntary behavior.

EMPLOYEE NEEDS AND DRIVESNeeds: deficiencies that energize or trigger behaviors to satisfy those needs. Drives: instinctive or innate tendencies to seek certain goals or maintain internal stability.

Needs are produced by drives but may also be strengthened by learning and social forces such as culture and childhood upbringing.

Maslow’s Needs Hierarchy Theory- a motivation theory of needs arranged in a hierarchy, whereby people are

motivated to fulfill a higher need as a lower one becomes gratified. - He called for a more holistic, humanistic, and positive approach to human

motivation research.- Five basic categories:

o Physiologicalo Safetyo Social (belongingness)o Esteem (self-esteem and social esteem)o Self-actualization – the need for self-fulfillment in reaching one’s

potential.o In addition to the 5, The need to know and the need for aesthetic beauty as

two needs that do not fit within the hierarchy.

Evaluation- do not seem to capture the entire variety of needs that people experience- gratification of one need level does not necessarily lead to increased motivation to

satisfy the next higher need level.- People don’t seem to fit into one universal needs hierarchy (needs hierarchy are

unique, not universal, because a person’s needs are strongly influenced by his or her value).

- In summary, we seem to have personal and somewhat flexible needs hierarchy, not one that is hardwired in human nature, as Maslow’s needs hierarchy theory assumes.

Four-drive Theory- a motivation theory based on the innate drives to acquire, bond, learn, and defend

that incorporates both emotions and rationality. - Both holistic (pulls together various drives and needs) and humanistic (considers

human thought and social influences rather than just instinct).

According to the theory, everyone has the drive to:- Drive to acquire – seek, take, control, and retain objects and personal experiences

(extends beyond basic food and water. It includes the need for relative status and recognition in society. It’s foundation of competition and the basis of our need for esteem).

- Drive to bond – drive to form social relationships and develop mutual caring commitments with others.

- Drive to learn – to satisfy our curiosity, to know and understand ourselves and the environment around us.

- Drive to defend – creates a fight-or-flight response in the face of personal danger (not only physical, but also relationship, acquisitions, belief systems, etc). In contrast, the other three are always proactive, we seek them.

Each is independent of each other and these four are complete.

Practical implications of four-drive theoryCompanies need to ensure that individual jobs and workplaces provide a balance opportunity to fulfill the drive to acquire, born, learn, and defend. Why?

- because each of us continuously seek fulfillment of all 4 drivers, not just some of them.

- These four drivers must be kept in balance.

Companies need to offer employees a choice of rewards rather than give everyone the same specific reward.

EXPECTANCY THEORY OF MOTIVATION- the motivation theory based on the idea that work effort is directed toward

behaviors that people believe will lead to desired outcomes.

Individual’s efforts depend on these 3 factors (E-effort, P-performance, O-outcome):- E-to-P expectancy – the individual’s perception that his or her effort will result in

a particular level of performance (0.0-1.0)o How to increase?o Assure employees they have the necessary competencieso Clear role perceptiono Necessary resources to reach the desired level of performance.o Matching job with skillso Communicating tasks requiredo Feedback

- P-to-O expectancy – the perceived probability that a specific behavior or performance level will lead to particular outcomes. (0.0-1.0)

o Measure employee performance accurately and distribute more valued rewards to those w higher job performance

o Need to know how higher performance will result in higher rewards

- Outcome valences – the anticipated dis/satisfaction that an individual feels towards an outcome. (negative-positive)

o Individualizing rather than standardizing rewards and other performance outcomes is important for employee motivation

o Watch out for countervalent outcomes-consequences w negative valences that reduce rather than enhance employee motivation.

The theory provides clear guidelines for increasing employee motivation.

GOAL SETTING AND FEEDBACKGoal setting: the process of motivating employees and clarifying their role perceptions by establishing performance objectives. Improves performance in 2 ways:

- stretching the intensity and persistence of effort- giving employees clearer role perceptions so that their effort is channeled toward

behaviors that will improve work performance.

Characteristics of effective goals6 conditions:

- Specific goals - Relevant goals – relevant to their jobs and within his/her control- Challenging goals – causes people to raise intensity and persistence of their work

effort and to think through info more actively. Also fulfills a sense of achievement.Stretch goals – goals you don’t know how to reach, so you need to be creative.

- Goal commitment – challenging but not so difficult until lose motivation. Same like E-P. The lower the E-P, the less committed.

- Goal participation – not always, but more effective when employees participate setting the goals.

- Goal feedback – any info people receive about their consequences of their behavior. An essential ingredient in motivation because our self-actualization and underlying drive to learn can’t be satisfied unless we receive info on goal accomplishment.

Characteristics of effective feedback- clarifies role perception and improves ability - motivates when it’s positive (recognition activities)- negative (constructive) can motivate too (for people with strong self-esteem)- specific and relevant- timely- sufficiently frequent- credible

Problems w goal setting- tends to focus employees on a narrow subset of measurable performance

indicators while ignoring aspects of job performance that are difficult to measure.

- When tied to financial rewards, many employees are motivated to make their goals easy (while making the boss think they are difficult) so they have a higher probability of receiving bonus or pay increase.

EQUITY THEORY- A theory that explains how people develop perceptions of fairness in the

distribution and exchange of resources. - The outcome/input ration is the value of the outcomes you receive divided by the

value of inputs you provide in the exchange relationships.- We compare our outcome/input ratio w a comparison other.

Motivation to reduce inequity feelings- reduce our inputs – perform at a lower level- increase our outcomes – ask for an increase in salary- increase comparison others’ inputs – ask a better-off co-worker to do larger

share of the work- reduce comparison other’s outcomes – ask the boss to stop giving favorable

treatment to the co-worker. - Change our perception- Change the comparison other- Leave the field

The theory:- Isn’t so easy to put because it doesn’t specify the comparison other and doesn’t

indicate which input/outcomes are most valuable to each employee.- The solution is for the leaders to know their employees well enough to minimize

the risk of inequity feelings. - Open communication!- To ensure fairness: give employees ‘voice’, encourage them to present facts and

perspectives on the issue. - Give full explanation behind each decision so employees feel they are treated w

respect.

JOB DESIGN- the process of assigning tasks to a job, including the interdependency of those task

w other jobs.

Job specialization: the result of division of labor in which each job includes a subset of the tasks required to complete the product or service.

Job characteristics model: a job design model that relates the motivational properties of jobs to specific personal and organization consequences of those properties. All jobs can be examined in terms of 5 core dimensions:

- Skill variety- Task identity – completion of a whole piece of work.- Task significance

- Autonomy- Job feedback

These 5 core dimensions affect employee motivation and satisfaction through 3 critical psychological states:

- Experienced meaningfulness (the 1st three)– the belief that one’s work is worthwhile or important.

- Experienced responsibility (autonomy)– where employees feel personally accountable for the outcomes of their efforts

- Knowledge of results (feedback)

Job enrichmentEvidence points to autonomy as the core dimension to consider when trying to enrich the motivational potential of jobs.Job enrichment: occurs when employees are given more responsibility for scheduling, coordinating, and planning their own work.

Another way to increase job enrichment: natural grouping – tasks are combined to form a meaningful piece of work, such as creating an entire product or large part of it. Increases task ID and significance.

Second way: establishing client relationships – putting employees in direct contact w consumers. Since they are directly responsible, they have more info and can make decisions affecting those clients.

Many firms have taken a broader approach to increasing autonomy: empowerment.

EMPOWERMENT PRACTICES- A psychological concept in which people experience more self-determination,

meaning, competence, and impact regarding their role in the organization.

If any of these dimensions weakens, sense of empowerment will weaken:- Self-determination – empowered employees feel freedom, independence,

discretion over their work activities- Meaning – employees who feel empowered care about their work and believe that

what they do is important.- Competence – empowered people are confident about their ability to perform the

work well and have a capacity to grow w new challenges.- Impact – empowered employees view themselves as active participants in the

orgs; i.e. their decision and actions have an influence on the company’s success.

Empowerment is not a personality trait, although the extent to which someone feels empowered might be influenced.

Supporting empowermentEmpowering workplace -> changing the work environment to support empowerment.

- Job characteristics influence dynamics of empowerment. - Must work in jobs with a high degree of autonomy w minimal bureaucratic

control. - Jobs must have high level of task ID and significance (sense of meaningfulness)- Jobs must provide sufficient feedback (self-confidence)- Employees feel empowerment in orgs where info and other resources are easily

accessible.- Also requires learning orientation culture – where employee learning is

encouraged and reasonable mistakes are viewed as a natural part of the learning process.

CHAPTER 6INDIVIDUAL DECISION MAKING

Decision making is a conscious process of making choices among one or more alternatives with the intention of moving toward some desired state of affairs.

RATIONAL CHOICE PARADIGM OF DECISION MAKINGRational choice paradigm of decision making: rationality and logic.

Steps:1. Identify problem or opportunity2. Choose the best decision process (ex: involve others or not)3. Develop alternative solutions4. Choose the best alternative: people choose the one with the highest subjective

expected utility: the ones that have highest payoff.5. Implement the selected alternative6. Evaluate decision outcomes

Rational choice paradigm is logical but rarely practiced in reality. Why?- People have difficulty recognizing problems: they can’t simultaneously process

the huge volume of info needed to ID the best solution.- They have difficulty recognizing when their choices failed.- Completely ignores emotion’s effect

IDENTIFYING PROBLEMS AND OPPORTUNITIESProblem ID (the 1st step) is arguably the most important step in decision making.

Problems with Problem ID- People with vested interests try to influence perceptions that there is or is not a

problem or opportunity. This frames the decision maker’s view of the situation (short-circuits a full assessment of the problem or opportunity).

- People block out negative info as a coping mechanism. - Mental models blind people from seeing opportunities that deviate form the status

quo.o If an idea doesn’t fit the existing mental model of how things should work,

then the idea is dismissed as unworkable or undesirable.- Decision makers lack the ability or motivation to diagnose problems.

o Tendency to focus on a solution, whereas proper diagnosis would determine the cause of symptoms before jumping to solutions. Coz people want to quickly understand and solve problems.

ID Problems and Opportunities More EffectivelyCan be improved by:

- Awareness of these perceptual and diagnostic limitations.- Recognizing how mental models restrict a person’s understanding of the world,

decision makers learn to openly consider other perspectives of reality.

- Discuss the situation with colleagues.- Leaders require willpower to look less decisive when there is a more thoughtful

examination needed.

EVALUATING AND CHOOSING ALTERNATIVESBounded rationality: processing limited and imperfect information and satisficing rather than maximizing when choosing among alternatives.

Problems with GoalsBest: clear goals.Reality: ambiguous or in conflict with each other.

Problems with Information Processing- Decision makers can’t possibly think through all of the alternatives and the

outcomes of those alternatives.- Decision makers typically look at alternatives sequentially rather than all at the

same time.- As a new alternative comes along, it’s compared to an alternative that the decision

maker prefers: implicit favorite – the decision maker’s preferred alternative against which all other choices are judged.

- People tend to defend their implicit favorite by distorting info and changing the importance of decision criteria.

Problems with Maximization- Satisficing rather than maximizing.- Satisficing: selecting a solution that is satisfactory, or ‘good enough,’ rather than

optimal, or ‘the best.’- Occurs because it’s not possible to look at all alternatives and the outcomes.- Also because decision makers tend to evaluate alternatives sequentially. They

compare alternatives with the implicit favorite and eventually select an option that is good enough to satisfy their needs or preferences.

Emotions and Making Choices- Our brain attaches specific emotions to information about each alternative when

we receive that info.- People with damaged emotional brain centers have difficulty making choices.- We pay more attention to details when in negative mood, and vice versa. - People ‘listen in’ on their emotions to provide guidance when making choices.

Intuition and Making ChoicesIntuition: the ability to know when a problem or opportunity exists and select the best course of action without conscious reasoning.

- Both emotional experience and rapid unconscious analytic process.- All gut feelings are emotional signals. Not all emotional signals are intuition.

Making Choices More Effectively- When leaders are decisive rather than contemplative: higher failure rate.- Systematically evaluating alternatives: minimize implicit favorite and satisficing

problems. - Constantly aware that decisions are influenced by both rational and emotional

processes.- Revisit important issues in different moods.- Scenario planning: a systematic process of thinking about alternative futures and

what the org should do to anticipate and react to those environments.

EVALUATING DECISION OUTCOMESEscalation of commitment: the tendency to repeat an apparently bad decision or allocate more resources to a failing course of action.

Why?- Self justification. Individuals are motivated to maintain their course of action

when they have a high need to justify their decision. - Prospect theory effect: an effect in which losing a particular amount is more

disliked than gaining the same amount.o Stopping a project is a certain loss, which is more painful to most people

than the uncertainty of success associated with continuing to fund the project. Given the choice, decision maker choose less painful option.

- Perceptual blinders. Escalation of commitment sometimes occurs because decision makers do not see the problems soon enough. They unconsciously screen out or explain away negative information to protect self-esteem.

- Closing cost. Even when a project’s success is in doubt, decision makers will persist because the costs of ending the project are high or unknown.

Recent studies suggest that throwing more money into a failing project is sometimes a logical attempt to further understand an ambiguous situation. This strategy is particularly common where the project has high closing cost.

Evaluating Decision Outcomes More EffectivelyWays to evaluate more effectively:

- Minimize escalation of commitment by: separate decision choosers from decision evaluators.

o This minimizes self-justification.- Publicly establish a preset level at which the decision is abandoned or

reevaluated.- Projects might have less risk of escalation if several people are involved.

EMPLOYEE INVOLVEMENT IN DECISION MAKINGEmployee involvement or participative management: the degree to which employees influence how their work is organized and carried out.

- Lowest level: employees are asked for information.

- Moderate level: employees are told about the problem and provide recommendation.

- Highest level: the entire decision-making process is handed over to the employees.

Advantages:- Improves problem ID because employees are usually the 1st to know when

something goes wrong w production, customer service, or many other subsystems within the org.

- Creates synergy that can generate more and better solutions that when these people work alone.

- People collectively tend to be better than individuals at picking the best alternative when they have diverse perspectives and backgrounds.

- Employee involvement also strengthens employee commitment to the decision.

Contingencies of Employee InvolvementA number of factors can undermine employee involvement or render it unnecessary, so we need to consider the following contingencies:

- Decision structure. Employee involvement is unnecessary when the problem is routine.

- Source of decision knowledge. Employees are closer to customers and production activities, so they often know where the company can save money, improve product or service quality, and realize opportunities.

- Decision commitment. - Risk of conflict

o If employee goals and norms conflict with the organization’s goals, then only a low level of employee involvement is advisable.

o The degree of involvement depends on whether employees will reach agreement on the preferred solution.

CHAPTER 7TEAM DYNAMICS

Teams: groups of two or more people who interact and influence each other, are mutually accountable for achieving common objectives, and perceive themselves as a social entity within an organization.

Groups: two or more people with a unifying relationship.

All teams are groups but not all groups are teams.

Why rely on teams?- under certain conditions, teams potentially make better decisions, develop better

products and services, and create a more energized workforce compared with employees working alone.

Why people belong to informal groups:- Human beings are social animals- Social identity theory: individuals define themselves by their group affiliations- To accomplish task that cannot be achieved by individuals working alone.

A MODEL OF TEAM EFFECTIVENESSTeam effectiveness: the extent to which a team achieves its objectives, achieves the needs and objectives of its members, and sustains itself over time (maintain commitment of its members).

ORGANIZATIONAL AND TEAM ENVIRONMENTSix of the most important contextual factors are:

- Reward system- Communications system- Physical space – put them together into a same room that encourages free flow of

communication more quickly and effectively- Organizational environment- Organizational structure – team works better in a flatter management structure.- Organizational leadership – ongoing support from senior executive, also requires

team leaders or facilitators who provide coaching and support.

TEAM DESIGN FEATURES3 main elements to consider when designing an effective team:

- Task characteristicso The higher the level of task interdependence, the greater the need for

teams rather than individuals working alone.o Task interdependence – the degree to which a task requires employees to

share common inputs or outcomes, or to interact in the process of executing their work.

o This motivation and satisfaction only occurs then team members have the same job goal.

- Team sizeo Should be large enough to provide the necessary competencies and

perspectives to perform the work, yet small enough to maintain efficient coordination and meaningful involvement of each member.

- Team compositiono High-performing team members demonstrate more cooperative behavior

toward others and generally have more EI.

Team diversityHomogenous team: teams that include members with common technical expertise, demographics, ethnicity, experiences, or values.

- higher satisfaction and less conflict- develop more quickly- more effective on tasks requiring a high degree of cooperation and coordination

Heterogeneous team: teams that include members with diverse personal characteristics and background.

- more conflict and take longer to develop.- Susceptible to ‘fault lines’ -> dividing lines that may split a team into subgroups- Even so, they are more effective in situations involving complex problems

requiring innovative solutions -> different perspectives and have a broader knowledge base.

- The diversity provides representation to the team’s constituents (other departments or clients from similarly diverse backgrounds).

TEAM PROCESSES5 stages of team development:

- Formingo Orientation. Learn about each other and evaluate the benefits and costs of

continued membership. Tend to be polite.- Storming

o Interpersonal conflict arises as members become more proactive and compete for various team roles.

o A tenuous stage if the leader is autocratic and lacks the necessary conflict-management skills.

- Norming o Develops its first real sense of cohesion as roles are established and a

consensus forms around group objectives.o Members have developed similar mental models, have common

expectations and assumptions about how the team’s goals should be accomplished.

- Performingo More task-oriented

o In a high-performing team, members are highly cooperative, have a high level of trust in each other, are committed to group objectives, and identify with the team.

- Adjourningo Members shift their attention away from task orientation to a

socioemotional focus as they realize that their relationship is ending.

Team norms: the informal rules and expectations that groups establish to regulate the behavior of their members.

- apply for behaviors that are important to the team, not to private thoughts and feelings.

How team norms develop:- Develop as soon as teams form because people need to anticipate or predict how

others will act. - Also forms when team members discover behaviors that help them function more

effectively (quick respond to emails).- The past experiences and values that members bring influence the norms.

Preventing and changing dysfunctional team norms:- Establish desirable norms when the team is first formed

o One strategy to do that is to select people w appropriate values.- To change dysfunctional norms in older teams:

o Explicitly discuss the counterproductive norm w team members using persuasive communication tactics.

o Team-based reward systems can weaken counterproductive norms.

Team roles – team members take various roles informally based on their personality, values, and expertise.

- Roles preferences are usually worked out during the storming stage- But in a dynamic environment, team members often assume various roles

temporarily as the need arises.

Team cohesiveness: the degree of attraction people feel toward the team and their motivation to remain members.Influences in team cohesiveness:

- Member similarity- Team size- Member interaction- Somewhat difficult entry (the more elite the team, the more prestige it confers on

its members, and they tend to value their membership in that team).- Team success- External competition and challenges

Cohesive teams can have lower task performance when norms conflict w org objectives, because cohesiveness motivates employees to perform at a level more consistent w group norms.

THE TROUBLE WITH TEAMSProcess losses: resources (including time and energy) expended toward team development and maintenance rather than the task.

“Brook’s law” – adding more people to a late software project only makes it later.

Team norms support company goals

Team norms conflictw company goals

low Team cohesiveness high

Social loafing: a situation in which people exert less effort (lower performance) when working in groups than when working alone.

- Most likely to appear in larger groups where individual output is difficult to identify.

- Ways to minimize social loafing:o Split team into several smaller groups so each person’s performance

becomes noticeable and importanto Give each member a different work activityo Measure each member’s contributiono Make the job more interestingo Choose people who are inherently motivated to perform the work or who

have a collectivist orientation so they are motivated not to let the group down.

SELF-DIRECTED WORK TEAMS (SDWTs)- cross-functional work groups, organized around work processes, that complete an

entire piece of work requiring several interdependent tasks and that have substantial autonomy over the execution of those tasks.

- Can be significantly more productive- But can be difficult to implement

o Management resistance – worry bout losing power (but not if they have personally worked in a high-involvement workplace and receive considerable training in their new facilitation role).

o SDWTs are less compatible with high power-distance cultureso Difficult to maintain in cultures w low collectivism

Moderately high task performance

High task performance

Moderately low task performance

Low task performance

VIRTUAL TEAMS- Teams whose members operate across space, time, and organizational boundaries

and are linked through IT to achieve organizational tasks. Differences:o They are usually not co-locatedo Due to their lack of co-location, members of virtual teams depend

primarily on IT rather than face-to-face interaction.

- Knowledge management and globalization make virtual teams necessary.o Knowledge management – allow and encourage employees to share and

use knowledge where geography limits more direct forms of collaboration.

- To improve it’s effectiveness:o Virtual team competencies (can use techs, have self-leadership skills,

higher EI to decipher emotions through emails)o Flexible IT (best if the team has a toolkit of comm. Methods, which gain

and lose importance over diff parts of the project).o Occasional face-to-face interaction

TEAM DECISION MAKING4 of the best known problems:

- Time constraints o Teams take longer than individuals.o Production blocking: a time constraint in team decision making due to

the procedural requirement that only one person may speak at a time.- Evaluation apprehension

o When individuals are reluctant to mention ideas that seem silly because they believe (often correctly) that other team members are silently evaluating them.

- Pressure to conformo High cohesion motivates employees to conform to team’s norms.

- Groupthinko The tendency of highly cohesive groups to value consensus at the price of

decision quality.

Team members need to be confident in their decision making, but not so confident that they collectively feel invulnerable.3 team structures that improve creativity and decision making:

- Constructive conflict – occurs when team members debate their different perceptions about an issue in a way that keeps the conflict focused on the task rather than the people.

- Brainstorming – a freewheeling, face-to-face meeting where team members aren’t allowed to criticize, but are encouraged to speak freely, generate as many ideas as possible, and build on the ideas of others

o Speak freely – even the craziest ideas

o Don’t criticizeo Provide as many ideas as possible – the quality of ideas increases w the

quantity of ideas.o Build on the ideas that others have presented.o Electronic brainstorming

- nominal group techniqueo a structured team decision-making process whereby team members

independently write down ideas, describe and clarify them to the group, and then independently rank or vote on them.

CHAPTER 9POWER AND INFLUENCE IN THE WORKPLACE

THE MEANING OF POWERPower: the capacity of a person, team, or organization to influence others. Not the act of changing others’ attitudes or behaviors, it is only the potential to do so.

Counterpower: the capacity of a person, team, or org to keep a more powerful person or group in the exchange relationship. Employees have counterpower by controlling their ability tow work productively or not.

SOURCES OF POWER IN ORGANIZATIONSThree sources of power that originate from the powerholder’s formal position (by the org) or informal role (by coworkers) are:

1. Legitimate power: an agreement among organizational members that people in certain roles can request certain behaviors of others.

a. Job description/positionb. Also depends on mutual agreement from those expected to abide by this

authority. (Boss tells you to work overtime, you agree or not).2. Reward power: derived from the person’s ability to control the allocation of

rewards valued by others and to remove negative sanction. a. Employees also have reward power: 360-degree feedback systems.

3. Coercive power: the ability to apply punishment. a. Employees also have coercive power ranging from sarcasm to ostracism,

to ensure that co-workers conform to team norms.

Two power sources that originate from the powerholder’s own characteristics:1. Expert power: an individual’s or work unit’s capacity to influence others by

possessing knowledge or skills that they value. 2. Referent power: the capacity to influence others based on the identification and

respect they have for the powerholder. a. It’s largely a function of the person’s interpersonal skills and develops

slowly.b. Usually associated with charisma: a form of interpersonal attraction

whereby followers develop a respect for and trust in the charismatic individual.

Information and PowerInformation power exists in two forms:

- People gain info power when they control the flow of info to others.- Info power is higher for those who seem to be able to cope with org uncertainties.

Individuals and work units gain power by offering one or more of the following ways to cope with uncertainty, with the 1st being more powerful:

- Prevention

- Forecasting- Absorption (machine breaks down, maintenance crews come)

CONTINGENCIES OF POWERThe sources of power operate at full capacity only under certain conditions. Four important contingencies of power:

1. Substitutability: the availability of alternatives.2. Centrality: the degree and nature of interdependence between the powerholder

and others. If you have high centrality, lots of people will be affected by your action.

3. Discretion: the freedom to exercise judgment—to make decisions without referring to a specific rule or receiving permission from someone else—is another important contingency of power in organizations.

4. Visibility. Those who control valued resources or knowledge will yield power only when others are aware of these power bases, then they are visible.

a. To increase visibility: take people-oriented jobs and work on projects that require frequent interaction with senior executives.

b. Be literally visible often. c. Display diplomas and awards on the wall.

Networking and PowerNetworking: cultivating social relationships with others to accomplish one’s goals. Networking increases a person’s power in three ways:

- Networks consist of people who trust each other -> increases the flow of knowledge among those within the network.

- People tend to identify more with partners within their own networks -> increases referent power among people within each network.

- Effective networkers are better known by others in the organization so their talents are more readily recognized.

INFLUENCING OTHERSPower is only the capacity to influence others. Influence refers to any behavior that attempts to alter someone’s attitudes or behaviors. Influence is power in motion.

Types of Influence TacticsHard influence tactics – they force behavior change through position power (legitimate, reward, and coercion):

1. Silent authority: occurs when someone complies with a request because of the requester’s legitimate power as well as the target person’s role expectations. This condition is called deference to authority.

a. the most common form of influence in high-power-distance cultures.2. Assertiveness: or vocal authority, involves actively applying legitimate and

coercive power to influence others. a. Persistently reminding the target of his or her obligations, frequently

checking on the target’s work, confronting, and using threats of sanctions to force compliance.

b. Explicit or implicit threats range from job loss to losing face by letting down the team.

3. Information control: involves explicitly manipulating others’ access to information for the purpose of changing their attitudes or behavior, or both. (the WorldCom accounting fraud example).

4. Coalition formation: when people lack sufficient power to influence others they form a coalition of people.

a. Coalition: a group that attempts to influence people outside the group by pooling the resources and power of its members.

b. Influential in 3 ways:i. It pools the power and resources of many people, so they have

more influence.ii. The coalition’s mere existence can be a source of power by

symbolizing the legitimacy of the issue (deserve attention).iii. The coalitions tap into the power of the social identity process.

5. Upward appeal: a type of coalition in which one of the members is someone with higher authority or expertise. It ranges from a formal alliance to the perception of informal support from someone with higher authority or expertise.

Soft influence tactics: they rely more on personal sources of power (referent, expert) and appeal to the target person’s attitudes and needs:

1. Ingratiation and impression management: any attempt to increase liking by, or perceived similarity to, some targeted person.

a. Better than most other forms of influence at predicting career success (performance appraisal feedback, salaries, and promotions).

b. It’s part of a larger influence tactic known as impression management: the practice of actively shaping our public image.

2. Persuasion: using logical arguments, facts, and emotional appeals to encourage people to accept a request or message.

a. One of the most effective influence strategies for career success.b. The effectiveness depends on the persuader’s characteristics, message

content, communication medium, and the audience being persuaded. c. The message should be limited to strong arguments, repeated a few

times.d. Should use emotional appeals but with logical arguments and

recommendations.e. Inoculation effect: a persuasive communication strategy of warning

listeners that others will try to influence them in the future and that they should be wary about the opponent’s arguments.

f. Best medium: face-to-faceg. More difficult to persuade people who have high self-esteem and

intelligence.3. Exchange: the promise of benefits or resources in exchange for the target

person’s compliance with your request.

a. The norm of reciprocity: individuals are expected to help those who have helped them.

b. Networking is another form of exchange as an influence strategy. Active networkers build up ‘exchange credits’ by helping colleagues in the short term for reciprocal benefits in the long term.

Consequences and Contingencies of Influence TacticsThree ways that people react when others try to influence them:

1. Resistance: people or work units oppose the behavior desired by the influencer and consequently refuse, argue, or delay engaging in the behavior.

2. Compliance: people are motivated to implement the influencer’s request at a minimal level of effort and for purely instrumental reasons.

3. Commitment: the strongest form of influence whereby people identify with the influencer’s request and are highly motivated to implement it even when extrinsic sources of motivation are no longer present.

Soft tactics tend to build commitment.Hard influence tactics tend to produce compliance or resistance.Hard tactics also tend to undermine trust, which can hurt future relationships.

Contingencies- Upward, Downward, or Lateral Influence: whether the person being influenced

is higher, lower, or at the same level in the organization.- Influencer’s power base: those with expertise tend to be more successful using

persuasion. Those with a strong legitimate power base are usually more successful applying silent authority.

- Personal and cultural values: personal values guide our preference for some influence methods more than others.

INFLUENCE AND ORGANIATIONAL POLITICSOrganizational politics: behaviors that others perceive as self-serving tactics for personal gain at the expense of other people and possibly the organization.

The influence tactics are labeled as organizational politics when observers view the tactics as self-serving behaviors at the expense of others and sometimes contrary to the interests of the entire organization or work unit.

Conditions Supporting Organizational PoliticsOrganizational politics flourishes under the right conditions: scarce resources and organizational change.

- Personal characteristics: affect a person’s motivation to engage in organizational politics. Some people have a strong need for personal as opposed to socialized power.

o Some individuals have strong Machiavellian values: the belief that deceit is a natural and acceptable way to influence others.

- Minimizing organizational politics and its consequences

o Clear rules and regulations to specify the use of scarce resourceso Effective organizational change practiceso Leaders need to actively manage group norms to curtail self-serving

influence activities.o Give employees more control over their work and keeping them informed

of organizational events.

CHAPTER 10CONFLICT MANAGEMENT

Conflict: the process in which one party perceives that its interests are being opposed or negatively affected by another party.

Conflict management: interventions that alter the level and form of conflict in ways that maximize its benefits and minimizes its dysfunctional consequences.

Socioemotional conflict: any situation where people view their differences as personal attacks rather than attempts to resolve an issue.

Three strategies to reduce socioemotional conflict:- EI- Cohesive team- Supportive team norms

o When team norms encourage team openness -> learn to appreciate honest dialogue w/o personally reacting to any emotional display during the disagreements.

o Can also use tactics like humor.

SOURCES OF CONFLICT IN ORGANIZATIONS6 main conditions that cause conflict in organizational settings are:

- Incompatible goals- Differentiation – different training, values, beliefs, experiences, perspectives,

mental images of ideal goals (during merger etc).- Task interdependence – conflicts increase as task-interdependence increases

(greater chance that each side may disrupt or interferes with others’).o Highest in reciprocal interdependence situations.

- Scarce resources - Ambiguous rules – uncertainty increases the risk that one party intends to

interfere w the other party’s goals.- Communication problems

o Lack communication causes stereotypeso Some people lack the skills to communicate in a diplomatic, no

confrontational manner.o Can cause less motivation in the future.

INTERPERSONAL CONFLICT MANAGEMENT STYLESWin-win orientation: the belief that the parties will find a mutually beneficial solution to their agreement.

Win-lose orientation: the belief that conflicting parties are drawing from a fixed pie, so the more one party receives, the less the other party will receive.

Five conflict resolution style:- Problem solving- Avoiding

o The best approach where conflict has become socioemotional or where negotiation has a higher cost than benefits of conflict resolution.

o Ongoing conflicts can increase frustrations.- Forcing – the strongest win-lose orientation

o Inappropriate except if you know you are right and the situation needs quick solution.

- Yielding – giving in completely or at least cooperating w little or no attention to your own interest

o Appropriate if the other party has more power or it’s not as important to you as it is to him/her.

o But may give the other side unrealistically high expectations, motivating to seek more from you in the future.

o In the long run, may create conflict rather than resolving it.- Compromising – looking for a position in which your losses are offset by equally

valued gains.o when there is little hope for mutual gain, both have equal power, both are

under time pressure, this may be the best.o However, it’s rarely a final solution and may cause parties to overlook

options for mutual gain.

People from collectivist culture tend to use problem solving or avoidance.Women: tend to choose problem solving or compromise.

STRUCTURAL APPROACHES TO CONFLICT MANAGEMENT:- Superordinate goals: a common objective held by conflicting parties that is more

important than their conflicting departmental or individual goals.- Reducing differentiation- Improving comm. and understanding

o Talking circle -> emphasis is on healing relationships and restoring harmony, typically through the circle’s communal experience and improved understanding of each person’s views.

- Reducing task interdependence- Increasing resources- Clarifying rules and procedures

THIRD-PARTY CONFLICT RESOLUTION- any attempt by a relatively neutral person to help the parties resolve their

differences. Three ways:o Arbitration

High control over the final decision Low over the process Follow previously agreed rules of due process, listen to arguments

from disputing employees, make a binding decisiono Inquisition

Control all discussions – high control on both decision and processo Mediation

High control over the process Little or no control over the decision Purpose: to manage the process and context of interaction between

the disputing parties.

- inquisitional approach – usually the least effectiveo cause they may collect limited info about the problem so their decision

may be an ineffective solution- for everyday disputes, mediation is best

o gives employees more responsibility for resolving their own disputeso although not as efficient as others, it gives high employee satisfaction

- when employees can’t solveo arbitration – cause the predetermined rules of evidence and other

processes create a higher sense of procedural fairness.o Is preferred where the org’s goals should take priority over individual

goals.

CHAPTER 11LEADERSHIP IN ORGANIZATIONAL SETTINGS

Leadership: influencing, motivating, and enabling others to contribute toward the effectiveness and success of the organizations of which they are members.

- Influence, motivate, clarify roles and goals, arrange work environments, etc.

Shared leadership or the leaderful org: anyone in the org may be a leader in various ways at various times.

COMPETENCY (TRAIT) PERSPECTIVE OF LEADERSHIPSeven competencies that are characteristics of effective leaders:

- Emotional intelligence. o Have the ability to perceive and express emotion, assimilate emotion in

thought, understand and reason with emotion, and regulate emotion in themselves and others.

o Social skills to build rapport as well as network with others.- Integrity.

o Leader’s truthfulness and tendency to translate words into deeds -> authentic leadership. Individual acts consistently with his or her beliefs or values.

o Integrity and honesty are the most important leadership characteristics. o Most employees don’t trust their leaders and don’t think they have

integrity.- Drive – inner motivation that leaders possess to pursue their goals and encourage

others to move forward with theirs.- Leadership motivation – leaders have a strong need for power because they want

to influence others. - Self-confidence – effective leaders believe in their leadership skills and ability to

achieve objectives. Effective leaders are typically extroverted.- Intelligence- Knowledge of the business

BEHAVIORAL PERSPECTIVE OF LEADERSHIPWhat behaviors make leaders effective?

- People-oriented behaviors: showing mutual trust and respect for subordinates, demonstrating a genuine concern for their needs, and having a desire to look out for their welfare.

- Task-oriented leadership style: assign employees to specific tasks, clarify their work duties and procedures, ensure that they follow company rules, and push them to reach their performance capacity.

Choosing Task- vs. People-Oriented LeadershipBoth are positively associated with leader effectiveness, but differences are often apparently only in very high or very low levels of each style.

- Absenteeism, grievances, turnover, and job dissatisfaction are higher among employees who work with supervisors with very low levels of people-oriented leadership.

- Job performance is lower among employees who work for supervisors with low levels of task-oriented leadership.

One problem with the behavioral leadership perspective is that the two categories are broad generalizations that mask specific behaviors within each category.

Best leadership style depends on the situation!

CONTINGENCY PERSPECTIVE OF LEADERSHIPThis style is based on the idea that the most appropriate leadership style depends on the situation.

Effective leaders must be both insightful and flexible and able to adapt their behaviors and styles to the immediate situation.

Path-Goal Theory of Leadership: a contingency theory of leadership, based on expectancy theory of motivation, that relates several leadership styles to specific employee and situational contingencies.

- Effective leaders strengthen the performance-to-outcome expectancy and valences of those outcomes by ensuring that employees who perform their jobs well have a higher degree of need fulfillment than employees who perform poorly.

- Strengthen the effort-to-performance expectancy by providing the info, support, and other resources necessary to help employees complete their tasks.

- It advocates servant leadership: the belief that leaders serve followers by understanding their needs and facilitating their work performance (coach, mentor, etc).

Leadership StylesFour leadership styles:

- Directiveo Clarifying behaviors that provide a psychological structure for

subordinates o Clarifies performance goals, the means to reach those goals, and the

standards against which performance will be judgedo Judicious use of rewards and disciplinary actions.

- Supportiveo Provide psychological support for subordinates.o Supportive leadership is the same as people-oriented leadership.

- Participativeo Encourage and facilitate subordinate involvement in decisions beyond

their normal work activities.- Achievement-oriented

o Encourage employees to reach their peak performance.

o Achievement-oriented leadership applies goal-setting theory as well as positive expectations in self-fulfilling prophecy.

Contingencies of Path-Goal TheoryTwo sets of situational variables that moderate the relationship between a leader’s style and effectiveness:

- Employee characteristics- Characteristics of the employee’s work environment.

Three contingencies:- Skill and experience: a combination of directive and supportive leadership is best

for employees who are, or perceive themselves to be, inexperienced and unskilled.o Directive leadership is detrimental when employees are skilled and

experienced because it introduces too much supervisory control.- Task structure

o Directive style when the task is not routine -> minimizes role ambiguity that tends to occur in these complex work situations, particularly for inexperienced employees.

o Supportive leadership in highly routine and simple jobs.o Participative leadership is preferred for non-routine tasks.

- Team dynamicso High team cohesiveness substitutes for supportive leadership.o Performance-oriented team norms substitute for directive and possibly

achievement-oriented leadership.o Low team cohesiveness -> supportive style.o Use directive style to counteract team norms that oppose the team’s formal

objectives.

Leadership SubstitutesIdentifies conditions that either limit the leader’s ability to influence subordinates or make that particular leadership style unnecessary.

- Performance-based reward systems keep employees directed toward organizational goals, so they might replace or reduce the need for task-oriented leadership.

- Effective leaders help team members learn to lead themselves through leadership substitutes.

- Teams with norms that support org goals may substitute for achievement-oriented leadership.

- SDWT, self-leadership, and reward systems might reduce the importance of task- or people-oriented leadership but probably wont’ completely replace leaders in these situations.

TRANSFORMATIONAL PERSPECTIVE OF LEADERSHIPTransformational leaders are agents of change: develop a vision for the org or work unit, inspire and collectively bond employees to that vision, and give them a con-do attitude that makes the vision achievable.

Transformational vs. Transactional LeadershipTransactional: leadership that helps organizations achieve their current objectives more efficiently. They manage.

Transformational: a leadership perspective that explains how leaders change teams or organizations by creating, communicating, and modeling a vision for the org or work unit and by inspiring employees to strive for that vision.

- They lead: changing the organization’s strategies and culture so that they have a better fit with the surrounding environment.

- Change agents who energize and direct employees to a new set of corporate values and behaviors.

Requires both. Transactional leadership improves organizational efficiency. Transformational leadership steers companies onto a better course of action.

Transformations vs. Charismatic Leadership Charisma: a personal trait that provides referent power over followers.Transformational: a set of behaviors that people use to lead the change process.

It’s possible to be a transformational leader without being charismatic.Charismatic leaders might be transformational leaders.

- Can use charisma to change the behavior of followers. - Charismatic leaders produce dependent followers- Transformational leaders have the opposite effect—they support follower

empowerment, which tends to reduce dependence on the leader.

Elements of Transformational LeadershipFour elements:

- Creating a strategic vision: transformational leaders shape a strategic vision of a realistic and attractive future that bonds employees together and focuses their energy toward a superordinate organizational goal.

- Communicating the vision: transformational leaders communicate meaning and elevate the importance of the visionary goal to employees, use emotional appeal and framing to establish a common mental model, use symbols, metaphors, stories, and other vehicles that transcend plain language.

- Modeling the vision: enact it, walk the talk. Reliable and persistent in their actions, thereby legitimating the vision and providing further evidence that they can be trusted.

- Building commitment toward the vision: build employee commitment through several ways:

o Words, symbols, and stories build a contagious enthusiasm that energies people to adopt the vision as their own.

o Demonstrate a can-do attitude by enacting their vision and staying on course.

o Persistence and consistency reflect an image of honesty, trust, and integrity.

o Involve employees in the process of shaping the organization’s vision.

Evaluating the Transformational Leadership PerspectiveSubordinates are more satisfied and have higher affective organizational commitment under transformational leaders.

Most popular. But faces a number of challenges:- leaders are transformational when they successfully bring about change, rather

than whether they engage in certain behaviors we call transformational.- Seems to be universal rather than contingency-oriented.

IMPLICIT LEADERSHIP PERSPECTIVEImplicit leadership theory: the theory that people rely on preconceived traits to evaluate others as leaders, and that they tend to inflate the influence of leadership on organizational events.

These perceptions are stereotypes or prototypes of idealized leadership that develop through socialization.Mental images of an ideal leader shape our expectations and acceptance of people as leaders, which in turn affect their ability to influence us as followers.

Fundamental attribution error: leaders are given credit or blame for the company’s success or failure because employees do not readily see the external forces that also influence these events.

Individuals who do not make an effort to fit leadership prototypes will have more difficulty bringing about necessary organizational change.

CROSS-CULTURAL AND GENDER ISSUES IN LEADERSHIPMale and females do not differ in their levels of task-oriented or people-oriented leadership.

- Women do adopt a participative leadership style more readily than their male counterparts.

- Women have somewhat better interpersonal skills than men, and this translates into their relatively greater use of the participative leadership style.

- Subordinates expect female leaders to be more participative, based on their own sex stereotype, so female leaders comply with follower expectations to some extent.

- Women are rated higher then men on the emerging leadership qualities of coaching, teamwork, and empowering employees.

- Women are evaluated negatively when they try to apply the full range of leadership styles, particularly more directive and autocratic approaches.

CHAPTER 12ORGANIZATIONAL STRUCTURE

Organizational structure: the division of labor and the patterns of coordination, communication, workflow, and formal power that direct organizational activities.

DIVISION OF LABOR AND COORDINATIONTwo fundamental requirements:

- The division of labor (increases work efficiency)- Coordinating work activities, coordinating mechanisms:

o Informal Communication – easiest in small firmso Formal hierarchy

assigns legitimate power to individuals, who then use this power to direct work processes and allocate resources

work is coordinated through direct supervisiono Standardization – involves creating routine patterns of behavior or output,

this take 3 distinct forms: Standardized process (making pizzas) Standardized outputs Standardized skills (doctors)

ELEMENTS OF ORGANIZATIONAL STRUCTUREFour basic elements of organizational structure:

- Span of control – the number of people directly reporting to the next level in the organizational hierarchy

o 31 employees under a supervisoro The best-performing manufacturing operations today rely on self-directed

work teams, so direct supervision (formal hierarchy) is just a back up.o ‘Delayering’ cuts OH costs and puts decision making closer to frontline

staff and info about customer needs.o Companies will always need hierarchy, cause someone has to make quick

decisions and represent a source of appeal over conflictso Conclusion: there is an optimal level of delayering (depends on the

number of people employed and the average span of control)- Centralization and decentralization

o The degree to which formal decision authority is held by a small group of people, typically those at the top of organizational hierarchy.

- Formalizationo The degree to which organizations standardize behavior through rules,

procedures, formal training, and related mechanisms.o Formalize as companies grow old and larger. Government also encourages

formalization. o May increase efficiency and complianceo But can also create problems: rules and procedures reduce org flexibility,

so employees follow prescribed behaviors even when the situation clearly calls for a customized response.

o Source of job dissatisfaction, particularly among young employees, and these rules tend to undermine performance of SDWTs as well as creativity among employees.

- Mechanistic vs. organic structureso Mechanistic – an organizational structure with a narrow span of control

and high degrees of formalization and centralization Operates best in stable environment because they rely on

efficiency and routine behaviors.o Organic – an organizational structure with a wide span of control, little

formalization, and decentralized decision making. More compatible w knowledge management because they

emphasize information sharing rather than hierarchy and status.

FORMS OF DEPARTMENTALIZATION- Structuring of organizations, how employees and their activities are grouped

together

Influences OB in the following ways:- departmentalization establishes chain of command- focuses people around common mental models or ways of thinking- encourages coordination through informal communication among people and

subunits

Five types of departmentalization:- Simple structure

o Employ only a few people and typically offer one distinct producto Minimal hierarchyo Flexible, yet under owner’s supervision

- Functional structureo An organizational structure that organizes employees around specific

knowledge or other resources.o Direct supervision is easier because managers have backgrounds in that

functional areao Creates common pools of talent -> provides economies of scaleo Limitations: grouping skills tends to focus attention on those skills and

related professional needs rather than on the company’s product/service or client needs.

o Produces higher dysfunctional conflict and poorer coordination in serving clients or developing products.

- Divisional structureo An organizational structure that groups employees around geographic

areas, clients, or outputs.o More autonomous than functional

o Geographic structure organizes employees around distinct regions of the country or globe

o Product/service structure organizes work around distinct outputso Client structure represents employees are organized around specific

customer groups A building block structure because it accommodates growth

relatively easily. Limitations: tends to duplicate resources, such as production

equipments and engineering or IT expertise. Unless the division is quite large, resources are not used as

efficiently as in functional structures where resources are pooled across the entire organization.

Reduces the ability and perhaps motivation of expertise to share knowledge w their counterparts in other divisions.

- Matrix structureo A type of departmentalization that overlays two organizational forms in

order to leverage the benefits of both (ex: geography and process). Optimizes resources and expertise, ideal for project-based orgs

with fluctuating workloads. Improves comm. efficiency, project flexibility and innovation

compared to purely functional or divisional designs. Works when two different dimensions deserve equal attention. But, it increases goals and ambiguity (have 2 bosses, 2 sets of

priorities that aren’t always aligned, challenges-> no ownership) Employees – stress, employers – less satisfied

- Team-based structureo A type of departmentalization w a flat hierarchy and relatively little

formalization, consisting of self-directed work teams responsible for various work processes.

o Builds around SDWTso Flattens the org’s hierarchyo Has very little formalization

reduces costs because teams have less reliance on formal hierarchy (direct supervision)

improves comm. and cooperation across traditional boundaries greater autonomy -> allows quicker and more informed decision

making but, difficult to maintain due to need for ongoing interpersonal

skills training takes more time to coordinate than formal hierarchy during early

stages of team development stress due to role ambiguity team leaders stress cause of conflicts, loss of functional power,

unclear career progression ladders.

CONTINGENCIES OF ORGANIZATIONAL DESIGNContingencies – ideas that work well in one situation might not work as well in another situation.Four contingencies of org design:

- External environmento Dynamism vs. stable environment

High rate of change, lack of identifiable patterns. Organic structures are better suited for this Stable environment - mechanic

o Complexity vs. simple More complex, more decentralized the org should become

o Diversity vs. integrated The more diversified, the more the firm needs to use a

divisionalized form aligned with that diversity.o Hostility vs. munificent

Hostile: scarce resources, competitive Organic structures is best for hostile However, when it’s extremely hostile, orgs may temporarily

centralize so decision can be made quickly and executives feel more comfortable being in control.

But centralization -> lower decision quality during org crisis, because top management has less info, especially when the environment is complex.

- Size o Larger firms, standardizeo However, emerging IT and increased emphasis on empowerment have

caused informal comm. to regain its importance in large firmso Large, tend to be more decentralized

- Technologyo Variability

Low variability (routine jobs, etc) -> mechanistic High variable - organic

o Analyzability Low analyzability -> less formalization & more informal comm. High -> more formalized

- Organizational strategyo The way an org positions itself in its setting in relation to its stakeholders,

given the org’s resources, capabilities, and mission.o Structure follows strategy

Orgs with cost leadership strategy should adopt a mechanistic, functional structure w high levels of job specialization and standardized work processes.

A differentiation strategy requires more customized relations w clients.

A matrix or team-based -> decentralization and less formalization.CHAPTER 13

ORGANIZATIONAL CULTURE

Organizational culture: 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.

- like the DNA: invisible to the naked eye, yet powerful template that shapes what happens in the workplace.

ELEMENTS OF ORGANIZATIONAL CULTURE- the assumptions, values, and beliefs that represent organizational culture operate

beneath the surface of behavior.

Check out exhibit 13.1 ‘elements of organizational culture’ iceberg.

Artifacts of org culture: physical structures, language, rituals and ceremonies, stories and legends.

(Unseen) Organizational culture: beliefs, values, assumptions.

Organizational SubculturesOrganizational culture: dominant culture.However, organizations are also comprised of subcultures located throughout their various divisions, geographic regions, and occupational groups.

- Some subcultures enhance the dominant culture by espousing parallel elements, while others are called countercultures because they directly oppose the organization’s core values.

- Subcultures potentially create conflict and dissension but they have 2 important functions:

o They maintain the org’s standards of performance and ethical behavior. Important source of surveillance and critique over the dominant order. Encourage constructive conflict and more creative thinking about how the org should interact with its environment. Help the org to abide by society’s ethical values.

o They are the spawning grounds for emerging values that keep the firm aligned with the needs of customers, suppliers, society, and other stakeholders.

DECIPHERING ORGANIZATIONAL CULTURE THROUGH ARTIFACTSArtifacts: the observable symbols and signs of an organization’s culture: the way visitors are greeted, the physical layout, and how employees are rewarded.Subtle and ambiguous.

Four board categories of artifacts:- Organizational stories and legends

o Provide human realism to corporate expectations, individual performance standards, and the criteria for getting fired.

o Stories have greatest effect at communicating corporate culture when they describe real people, are assumed to be true, and are remembered by employees throughout the organizations.

o Stories are also prescriptive—they advise people what to do or not to do.- Rituals and ceremonies

o Rituals: the programmed routines of daily organizational life that dramatize the organization’s culture.

How visitors are greeted, how often senior executives visit the subordinates, how people communicate with each other, how much time employees take for lunch, etc.

o Ceremonies: planned and usually dramatic displays of organizational culture, conducted specifically for the benefit of an audience.

- Organizational languageo How employees address co-workers, describe customers, express anger,

and greet stakeholders are all verbal symbols of cultural values.- Physical structures and symbols

o The size, shape, location, and age of buildings might suggest the company’s emphasis on teamwork, environmental friendliness, flexibility, or any other set of values.

ORGANIZATIONAL CULTURE AND PERFORMANCEA strong corporate culture is potentially good for business because it serves three important functions:

- Org culture is a deeply embedded form of social control that influences employee decisions and behavior.

- Org culture is the “social glue” that bonds people together and makes them feel part of the organizational experience. It fulfills their need for social ID. This is a way to attract new and retain top performers.

- Org culture assists the sense-making process. Helps employees understand what goes on and why things happen in the company.

Org Culture: Strength and Fit- One reason for the weak relationship is that a strong culture increases

organizational performance only when the cultural content is appropriate for the org’s environment.

- Second concern: strong cultures lock decision makers into mental models that blind them to new opportunities and unique problems.

- Third issue is that very strong cultures tend to suppress dissenting subcultural values.

Adaptive Culture

- An organizational culture in which employees focus on the changing needs of customers and other stakeholders, and support initiatives to keep pace with those changes.

Bicultural AuditBicultural audit diagnoses cultural relations between companies prior to a merger and determines the extent to which cultural clashes are likely to occur.

- Begins with identifying cultural differences between the merging companies.- Next, the bicultural audit data are analyzed to determine which differences

between the 2 firms will result in conflict and which provide common ground to build the new co on.

- Finally, identify strategies and prepare action plans to bridge the 2 org’s cultures.

Strategies to Merge Different Organizational CulturesFour main strategies:

Merger Strategy Description Works Best WhenAssimilation Acquired company embraces acquiring

firm’s cultures.Acquired firm has a weak culture.

Deculturation Acquiring firm imposes its culture on unwilling acquired firm.

Rarely works—may be necessary only when acquired firm’s culture doesn’t work but employees don’t realize it.

Integration Combining the two or more cultures into a new composite culture.

Existing cultures can be improved.

Separation Merging companies remain distinct entities with minimal exchange of culture or organizational practices.

Firms operate successfully n different businesses requiring different cultures.

CHANGING AND STRENGTHENING ORGANIZATIONAL CULTUREThe only way to ensure any lasting change is to realign cultural values with those changes.Changes ‘stick’ when they become ‘the way we do things around here.’

Strengthening Organizational CulturesFive approaches:

- Actions of founders and leaders: subsequent leaders can break the organization away from the founder’s value if they apply the transformational leadership concepts.

- Introducing culturally consistent rewards- Maintaining a stable workforce

o Organization’s culture is embedded in the minds of tis employees. o Stories, rituals and ceremonies, metaphors are not written down or visible

to the naked eye.

o Thus, organizations depend on a stable workforce to communicate and reinforce the dominant beliefs and values.

o Company’s culture disintegrate during periods of high turnover.- Managing the cultural network: org culture is learned through informal

communication, so an effective network of cultural transmission is necessary to strengthen the company’s underlying assumptions, values, and beliefs.

- Selecting and socializing employeeso Org culture is strengthened by hiring people who already embrace the

cultural values.o Organizational socialization: the process by which individuals learnt he

values, expected behaviors, and social knowledge necessary to assume their roles in the organization.

ORGANIZATIONAL SOCIALIZATIONStages of socialization:

- Pre-employment socializationo Look for info about the company, formed expectations about working

there, and felt some anticipation about fitting into that environment.o Encompasses all of the learning and adjustment that occurs prior to the

first day of work in a new position.- Encounter

o The first day on the job.o Reality shock: occurs when newcomers perceive discrepancies between

their preemployment expectations and on-the-job reality. - Role management: employees settle in as they make the transition from

newcomers to insiders.

Improving the Socialization ProcessRealistic Job Preview (RJP): giving job applicants a balance of positive and negative information about the job and work context.

- helps applicants develop more accurate preemployment expectations that, in turn, minimize reality shock.

- RJPs increases organizational loyalty.- Companies who provide candid information are easier to trust.

Socialization Agents- Helpful co-workers, bosses, or friends who work for the company.- Supervisors tend to provide technical info, performance feedback, and info about

job duties.- Co-workers are easily accessible, can answer Qs when problems arise, and serve

as role models for appropriate behavior. Flexible and tolerant in their interactions with these new hires.

- ‘buddy system’ whereby newcomers are assigned to co-workers for sources of information and social support.

CHAPTER 14ORGANIZATIONAL CHANGE

LEWIN’S FORCE FIELD ANALYSIS MODELForce field analysis: Kurt Lewin’s model of system wide change that helps change agents diagnose the forces that drive and restrain proposed organizational change.

There are driving forces and restraining forces (called resistance to change because they appear as employee behaviors that block the change process).

Stability occurs when the driving and restraining forces are roughly in equilibrium.

Effective change occurs by unfreezing the current situation, moving to a desired condition, and then refreezing they system so that it remains in this desired state.

- Unfreezing: the first part of the change process, whereby the change agent produces disequilibrium between the driving and restraining forces.

- Refreezing: the latter part of the change process, in which systems and conditions are introduced that reinforces and maintains the desired behaviors.

Restraining ForcesTakes many forms: passive noncompliance, complaints, absenteeism, turnover, and collective action.

Leaders need to understand why employees oppose changes, the main reasons are:- Direct costs: people tend to block actions that result in higher direct costs or

lower benefits than the existing situation.- Saving face: some people resist change as a political strategy to ‘prove’ that the

decision is wrong or that the person encouraging change is incompetent.- Fear of the unknown: worried they cannot adopt the new behaviors; increase the

risk of personal loss.- Breaking routines: people hate leaving their comfort zones.- Incongruent organizational systems: organizational systems that maintain

stability discourages employees from adopting new ways.- Incongruent team dynamics: conformity to existing team norms may discourage

employees from accepting organizational change.

UNFREEZING, CHANGING, AND REFREEZINGUnfreezing occurs when the driving forces are stronger than the restraining forces. Thus, unfreezing takes place when we strengthen the driving forces, weaken or remove the restraining forces, or a combination of both.

Increasing the driving forces creates urgency for change, whereas reducing the restraining forces minimizes resistance to change.

Reducing the Restraining ForcesStrategy Example When Used ProblemsCommunication Customer complaint letters

shown to employees.When employees don’t feel urgency for change or don’t know how the change will affect them.

Time-consuming and potentially costly.

Learning Employees learn how to work in teams as company adopts a team-based structure.

When employees need to break old routines and adopt new role patterns.

Time-consuming and potentially costly.

Employee involvement

Company forms task force to recommend new customer service practices.

When the change effort needs more employee commitment, some employees need to save face, or employee ideas would improve decisions about the change strategy.

Very time-consuming; might also lead to conflict and poor decisions if employees’ interests are incompatible with organizational needs.

Stress management

Employees attend sessions to discuss their worries about the change.

When communication, training, and involvement do not sufficiently ease employee worries.

Time-consuming and potentially expensive; some methods may not reduce stress for all employees.

Negotiation Employees agree to replace strict job categories with multiskilling in return for increased job security.

When employees will clearly lose something of value from the change and would not otherwise support the new conditions; also necessary when the company must change quickly.

May be expensive, particularly if other employees want to negotiate their support; also tends to produce compliance but not commitment to the change.

Coercion Company president tells mangers to ‘get on board’ the change or leave.

When other strategies are ineffective and the company needs to change quickly.

Can lead to more subtle forms of resistance, as well as long-term antagonism with the change agent.

Refreezing the Desired Conditions- realign the reward system around desired behavior and outcomes.

STRATEGIC VISIONS AND CHANGE AGENTSLewin’s force field analysis model overlooks 3 other ingredients in effective change process: strategic visions, change agents, and diffusing change.

This vision provides a sense of direction and establishes the critical success factors against which the real changes are evaluated.

Also minimizes employee fear of the unknown and provides a better understanding about what behaviors employees must learn for the future state.

Change Agents- anyone who possesses enough knowledge and power to guide and facilitate the

organizational change effort.- Transformational leaders are the primary agents for change.- Also requires transactional leaders who implement the change.- Finally, just as employees are encouraged to become leaders anytime and

anywhere, they also assist the change process as role models for others to follow in the change process.

THREE APPROACHES TO ORGANIZATIONAL CHANGE1. Action research approach

- A data-based, problem-oriented process that diagnoses the need for change, introduces the intervention, and then evaluates and stabilizes the desired changes.

- Adopts an open system view. Organizations have many interdependent parts, so change agents need to anticipate both the intended and unintended consequences of their interventions.

o Form client-consultant relationship: action research usually assumes the change agent originates outside the system (such as consultant), so the process begins by forming the client-consultant relationship.

o Diagnose the need for change: include employee involvement in agreeing on the appropriate change method, the schedule for these actions, and the expected standards of successful change.

o Introduce intervention In this stage, the model applies one or more actions to correct the

problem. Some experts recommend incremental change. Incremental change

is risky when the organization is seriously misaligned with its environment, thereby threatening its survival.

Others claim that quantum change is often required. Quantum change is usually traumatic to employees and offers little opportunity for correction.

o Evaluate and stabilize change: the effectiveness of intervention might not be apparent for several years, or might be difficult to separate from other factors.

2. Appreciative inquire approach- An organizational change process that directs attention away from the group’s

own problems and focuses participants on the group’s potential and positive elements.

- Useful when participants are aware of their ‘problems’ or already suffer from enough negativity in their relationships.

- Four-D model:

o Discovery: identifying positive elements of the observed events or org.o Dreaming: envision what might be possible in an ideal org.o Designing: the process of dialogue, in which participants listen with

selfless receptivity to each other’s models and assumptions and eventually form a collective model for thinking within the team.

o Delivering: participants establish specific objectives and direction for their own organization based on their model of what will be.

- Requires a particular mind=set in which participants are willing to let go of the problem-oriented approach and leaders are willing to accept appreciative inquiry’s less-structured process.

3. Parallel learning structure approach- Highly participative groups constructed alongside (i.e. parallel to) the formal

organization with the purposes of increasing the organization’s learning and producing meaningful organizational change.

- Created enthusiasm in participants that spread contagiously to their co-workers, including managers above them, when they returned to their home countries.

CROSS-CULTURAL AND ETHICAL ISSUES IN ORGANIZATIONAL CHANGEEthical concerns:

- Threat to privacy rights of individuals. o The action research model is built on the idea of collecting information

from org members, yet this requires employees to provide info that they may not want to divulge.

- Some change activities potentially increase management’s power by inducing compliance and conformity in organizational members.

- Some organizational change interventions undermine the individual’s self-esteem. The unfreezing process requires participants to disconfirm their existing beliefs.