Behavior in Organization Mid-Term Review

Behavior in Organization Mid-term Review

Chapter 1

I the Field of OB

 A. Origins and Definitions

   OB: The study of what people think, feel, and do in and around organizations

   Organizations: Groups of people who work interdependently toward some purpose;

     2 key features: organizations are collective entities and their members have a collective sense of purpose.

 B. Why study OB

   OB helps to fulfill the need to understand and predict the world in which we live & to get things done in organizations (influence behavior)

   OB is for everyone.

   OB is important for the organization’s financial health.

   OB improves the organization’s survival and success.

II Four Perspectives of Organization Effectiveness: OB theories have the implicit and explicit objective of making organizations more effective.

  (Goal attainment: An old and poor way of viewing organizational effectiveness because leadership team could set goals that are easy to achieve or they might aim the organization in the wrong direction.)

1. Open system (Foundation): organizational effectiveness depends on the external environment for resources, affect that environment through their output (Feedback), and consist of internal subsystems that transform inputs into outputs.

Sources: Raw materials, Human resources, Information, Financial resources, Equipment.

External environment: rules and expectations (laws and cultural norms)

Outputs: Products and Services, Shareholder dividends, Community support, Waster and pollution

Effective organizations: maintain a close fit with changing conditions & transform inputs to outputs efficiently and flexibly (operates internally)

Good fit means organization puts resources where they are most useful to adapt to and align with the needs of the external environment.

Organizational efficiency (productivity): the ratio of inputs to outputs in transformation process.

1. Organizational Learning (knowledge management): organizational effectiveness depends on the organization’s capacity to acquire, share, use and store valuable knowledge. (main driver of competitive advantage)

Absorptive capacity: the ability to recognize the value of new information, assimilates it, and uses it for value-added activities.

Stock: intellectual capital; most obvious form is human capital-the knowledge, skills, and abilities that employees carry around in their heads and provide economic value; structural capital-knowledge embedded in an organization’s systems and structures; relationship capital-relationships with customers, suppliers, and other who provide added mutual value for the organization.

Flow: acquisition, sharing, and use

Knowledge acquisition: learning, scanning, grafting (fastest & most powerful, hiring individuals or acquiring entire companies), experimenting

Knowledge sharing: communication, training, information systems, observation

Knowledge use: awareness, sense-making, autonomy, empowerment

Knowledge storage (the process that creates organizational memory): human memory, documentation, practices/habits, databases

Organizational Memory: The storage and preservation of intellectual capital by keeping knowledgeable employees, transferring knowledge to others, and transferring human capital to structural capital; successful companies also unlearn.

1. High-Performance Work Practices (HPWPs): the effective organizations incorporate several workplace practices that leverage the potential of human capital; based on human capital-employee knowledge, skills, and abilities-is competitive advantage-variable (help discover opportunities and minimize threats in the external environment), rare, difficult to imitate, and nonsubstitutable (cannot be replaced by technology).

Employee involvement and job autonomy (independent & freedom): to strengthen employee motivation as well as improve decision making, organizational responsiveness, and commitment to change.

Employee competence: recruit and select people with relevant skills, knowledge, values, and other personal characteristics & invest in employee development through training and development.

Performance/skill-based rewards: link performance and skill development to various forms of financial and nonfinancial rewards valued by employees.

Four HPWPs have a strong effect when they bundled together.

HPWPs build human capital, improve organizational effectiveness and improve the organization’s adaptability to rapidly changing environments.

1. Stockholder: individuals, organizations, and other entities who affect, or are affected by, the organization’s objectives and actions.

Stakeholders have conflicting interests and limited resources.

CSR (corporate social responsibility): organizational activities intended to benefit society and the environment beyond the firm’s immediate financial interests or legal obligations; organizations have a contract with society.

Triple bottom line: economy, society, environment.