Textbook Notes - Chapter 1

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Published on 10 Nov 2010
Management (MGH)
MGTB27 / 01 Week 1
What Are Organizations?
- Organizations are social inventions for accomplishing common goals through group effort
- E.g. HOK, CBC, Toronto Blue Jays and a college sorority or fraternity
Social Inventions
- When organizations are social inventions, this means that their essential characteristic is the
coordinated presence of people (e.g. not owning lots of things such as equipment or offices)
- The field of organizational behaviour is about understanding people and managing them to
work effectively
Goal Accomplishment
- Organizations such as CBC, Toronto Blue Jays and a college sorority/fraternity have goals of
winning baseball games, delivering news, and educating people
- Non-profit organizations have goals such as saving souls, promoting the arts, helping the
needy, or educating people
- All organizations have survival as a goal but some organizations do fail (e.g. Canadian
- The field of organizational behaviour is concerned with how organizations can survive and
adapt to change
- Certain behaviours are necessary for survival and adaptation. People have to:
o Be motivated to join and remain in the organization
o Carry out their work reliably in terms of productivity, quality, and service
o Be willing to continuously learn and upgrade their knowledge and skills
o Be flexible & innovative(adapt to change; important for contemporary organizations)
Group Effort
- Organizations depend on interaction and coordination among people to accomplish their goals
since much of the intellectual and physical work done in organizations is performed by
- The field of organizational behaviour is concerned with how to get people to practise effective
What is Organizational Behaviour?
- Organizational behaviour refers to the attitudes and behaviours of individuals and groups in
organizations (provides insight about effectively managing and changing behaviours)
- Also studies how organizations can be structured more effectively and how events in their
external environments affect organizations
- Those studying organizational behaviour are interested in attitudes (e.g. how satisfied people
are with their jobs, how committed they feel to the goals of the organization etc...)
- Questions and factors that make an organization a great place to work
o How does organizational culture DIIHFWDQRUJDQL]DWLRQ¶VVXFFHVV"
HOK emphasizes collaboration, creativity, and social responsibility
o How do employees learn?
Employees have access to tuition reimbursement program/training courses
o How can organizations motivate employees?
Employees receive above average compensation and benefits as well as
bonuses based on their performance and company profits
o How should managers communicate to employees?
Communicates through company newsletters and intranet site
Chapter 1 ± Organizational Behaviour and Management (pg. 2 ± 25)
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MGTB27 / 02 Week 1
Why Study Organizational Behaviour?
- Why should we read and understand material in organizational behaviour?
Organizational Behaviour is Interesting
- It is interesting because it is about people and human nature (e.g. understands why employees
become committed to an organization and what motivates them to work hard)
- O.B. provides the tools to find out why bosses or why you behave the way you do
Organizational Behaviour is Important
- What happens in organizations often has a profound impact on people
- Organizational behaviour is important to managers, employees, and consumers, and
- understanding it can make us more effective managers, employees, or consumers
- There may be tremendous variation in organizational behaviour (e.g. skilled salespeople in
insurance and real estate make more than some of their peers)
- Field of O.B. is concerned with explaining these differences and using the explanations to
improve organizational effectiveness and efficiency
Organizational Behaviour Makes a Difference
- In Competitive Advantage Through People, Jeffrey Pfeffer argues that organizations can no
longer achieve a competitive advantage through the traditional sources of successes (e.g.
technology, regulated markets, access to financial resources, and economies of scale)
- Sustained competitive advantage and organizational effectiveness are increasingly related to
the management of human capital and organizational behaviour
- There is increasing evidence that management practices and O.B. not only influence
- RBC Financial Group recognize that satisfied, high-performing employees are good for
profits. Human resources and management practices resulted in an improvement in both
employee and customer satisfaction
How Much Do You Know About Organizational Behaviour?
- In general, researchers have found that the personalities of effective leaders vary a fair
amount, many people prefer routine jobs, managers are not well informed about the pay of
their peers and superiors, workers underestimate their own absenteeism, and pay is not always
the most effective way to motivate workers and improve job performance
- ³FRPPRQVHQVH´GHYHORSVWKUough unsystematic and incomplete experiences with O.B.
(statements could either be true or false, [e.g. Pay will motivate workers to work harder])
o Pay will always motivate workers because most people want to make more money so
they will work harder
o Some workers will only work as hard as they have to regardless of how much money
they are paid
Goals of Organizational Behaviour
- O.B. has a number of commonly agreed-upon goals: effectively predicting, explaining, and
managing behaviours that occurs in organizations
Predicting Organizational Behaviour
- Predicting the behaviour of others is an essential requirement for everyday life both inside
and outside of organizations
o Outside of organizations, if we are able to anticipate when our friends will get angry
or when politicians are telling the truth, this will make our lives easier
o In organizations, there is considerable interest in predicting when people will make
ethical decisions, create innovative products, or engage in sexual harassment
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MGTB27 / 03 Week 1
- Predicting organizational behaviour does not guarantee that we can explain the reason for the
behaviour and develop an effective strategy to manage it
Explaining Organizational Behaviour
- Another goal of organizational behaviour is to explain events in organizations and why they
occur (prediction and explanation are not synonymous)
- Organizational behaviour is especially interested in determining why people are more or less
motivated, satisfied, or prone to resign
- Explaining an event is more complicated than predicting it because particular behaviour may
have multiple causes (e.g. resign from job because of low pay or they are discriminated
against; companies that find that they have high turnover problem will have to find out why
this is happening before it can put an effective correction into place)
Managing Organizational Behaviour
- Management is defined as the art of getting things accomplished in organizations
- Managers acquire, allocate, and utilize physical and human resources to accomplish goals
- If behaviour can be predicted and explained, it can often be controlled. But this is hardly the
case so we must approach a problem with a systematic understanding of behavioural science
Early Prescriptions Concerning Management
- Experts interested in organizations were FRQFHUQHGZLWKSUHVFULELQJWKH³FRUUHFW´ZD\WR
manage an organization to achieve its goals, the classical and the human relations view
The Classical View and Bureaucracy
- Most of the major advocates of the classical viewpoint were experienced managers or
consultants who took the time to write down their thoughts on organizing (~ 1900s)
- The classical viewpoint tended to advocate a very high degree of specialization of labour,
intensive coordination, and centralized decision making
- To maintain control, managers have fairly few workers where machine pacing might
substitute for close supervision
- Frederick Taylor (1856-1915) is the father of Scientific Management which advocated the
use of careful research to determine the optimum degree of specialization and standardization
maximum efficiency)
specialize in particular functions (e.g. a specialist in training workers)
- Max Weber (1864-1920) was a distinguished German social theorist who made the term
- Bureaucracy has the qualities of:
o Strict chain of command where member reports to only a single superior
o Criteria for promotion based on impersonal technical skills rather than favouritism
o Set of detailed rules, regulations, and procedures that ensure that the job gets done
o Use of strict specialization to match duties with technical competence
o Centralization of power at the top of the organization
- Weber believed that bureaucracy standardize behaviour in organizations and provide workers
with security and a sense of purpose
- ³%XVLQHVVSKLORVRSKHU´0DU\3DUNHU)ROOHWW-1933) noted that the classical view of
management seemed to take for granted an essential conflict of interest between managers
and employees which can be found in the human relations movement
The Human Relations Movement and a Critique of Bureaucracy
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