  Chapter 

Organisational behaviour observes the interactions and habits of people and organisations. It tries to improve the organisations effectiveness.

Pfeffer found evidence that ‘people-centred practices’ are strongly associated with higher profits and significantly lower employee turnover. Seven people-centred practices in successful companies:

  • Job security: eliminate fear of losing a job

  • Careful hiring: emphasis on good fit with company culture

  • Power to the people: decentralisation and self-managed teams

  • Generous pay for performance

  • Lots of training

  • Less emphasis on status: to build a ‘we’ feeling

  • Trust-building: through the sharing of critical information

History

Classic social theory Marx, Drukheim, Weber

Rational-system view Taylor, Fayol, Barnard, Simon

Human relations view Mayo, Follett, McGregor

Symbolic interactionism – postmodernism Weick

Conflict-critical view Marx

Rational-system view

Taylor

He is the founder of scientific management. This is an approach to management in which all tasks in organisations are analysed, routinised, divided and standardised in depth, instead of using rules of thumb. This leads to more efficiency due to the increasing pace of working because of the divided subtasks.

Consequences:

  • Higher output

  • Standardisation

  • Control and predictability

  • The routine of the tasks allowed the replacement of skilled workers by non-skilled workers

  • Thinking is for managers, workers only work

  • Optimisation of the tools for each worker

Both employees and managers were analysed. Managers were provided with subtasks. Even though Taylor raised the loans, he got a lot of resistance from the employee’s. Many employees felt as if they lost their value as skilled employees. Due to misinterpretation and misuse, Tayor's had a bad reputation for pressuring workers by letting them do inhuman work methods and forcing them to work at speed to enrich management.

Fayol

He is the founder of ‘management’. Introduced five basic management tasks:

  • Planning: predicting a course of action to meet the planned goals.

  • Organising: allocating materials + organising people. Authority, discipline, control.

  • Leading: giving directions + orders to employees. Convince + influence + motivate others to make them accomplish the goals.

  • Co-ordinating: harmonise different departments to one unit, working for the general interest of the company.

  • Controlling: to what extent the goals were met + orders are followed. Carried out by an independent + competent employee.

To execute those basic tasks, fourteen management principles should be obeyed:

  • Division of labour

  • Authority and responsibility

  • Discipline

  • Unity of command

  • Unity of direction

  • Subordination of individual interest to the general interest

  • Fair remuneration of personnel

  • Centralisation

  • Hierarchy

  • Order

  • Equity

  • Stability of tenure of personnel: low turnover

  • Initiative by every employee

  • Unity among the employees

Six skills a manager should possess:

  • Physical qualities

  • Mental qualities

  • Moral qualities

  • General education

  • Specific education

  • Experience

Fayol had big admiration for Taylor, however they had two disagreements:

  • Fayol doesn't completely seperate acting andt thinking. Taylor does.

  • For Fayol is 'Unity of command' a crucial principle, however it does not fit with the principles of Taylor.

Bernard

Build his theory on general principles of co-operative systems. He describes individuals as separate beings but not totally independent. Freedom is bounded by biological and physical limitations. Effectiveness will increase by co-operative actions, necessary elements:

  • Willingness to co-operate

  • A common purpose

  • Communication about the actions

  • Specialisation

  • Incentives

  • Authority

  • Decision-making

He also states that organisations consist smaller, less formal groups, which all have their own goals. Management should align those goals to the overall organisational goal. The informal aspect of management and organisations is the main difference of scientific management.

Simon

Categorised under the rational-system view because of his rational approach to the working of organisations and he tried to apply principles of the hard science to social sciences (administrative decision-making processes). Organisation is characterised by communication, relationships and decision-making processes. How to motivate employees:

  • Loyalty of the employee to the organisation: commitment, identify himself

  • Training

  • Coercion: psychological manipulations to convince the worker into being motivated.

Humans have psychological and social limitations in thinking rationally, bounded rationality.

Human relations view

Human Relations Movement: Established because unions wanted better working conditions and researchers wanted more attention to the human factor within an organisation.

Mayo

He did research to the attention that was given to employees at Western Electric’s Hawthorne plant. Outcomes of this research: There is no correlation between working conditions and the employee output. Motivation was stimulated by status and the influence of mutual adjustments within the workgroup.Members of informal groups don't always belong to the same formal groups. Every groups creates their own noms and values. Follett

She stressed the importance of human relations in organisations, particularly the improvement of the relationship between management and employees. Employees were the key parts, paying attention to their needs was the way to improve productivity. Follett’s view on management was the integration of the individual and the organisation. She focussed on interest and needs of the workers and managers. Six concepts of Follett’s work:

  • Dynamism: dynamic social relations

  • Empowerment: a self-developed capacity, not a pre-existing thing.

    • Power-over: coercive power.

    • Power-with: co-active power.

  • Participation: co-ordination of the contribution of each individual unit. Clear communication, openness, explicitness.

  • Leadership: Communication, vision sharing. Inspires others to innovate and achieve goals.

  • Conflict: Shows differences between people, neither good nor bad. Solution: integration.

  • Experience

McGregor

He formulated two different approaches regarding the human nature, theory X and theory Y. (see Table 1.4 )

Symbolic interactionism – postmodernism

Symbolic interactionism

Focus on individual behaviour and interactions on micro-level. Subjective interpretations of the world by interactions. Enacted theory World is created by communication. Explains why people can have different reactions and make different decisions in the same situations.

Postmodernism

A very subjective and situation orientated ‘theory’. Postmodernism makes it impossible to develop general applicable theories of this world.

Conflict-critical view

Conflict theory

Social structures and relations within organisations are based on conflicts between groups and social classes. This is in contrast with the rational-view.

Critical theory

There is no general idea, but the concept is a being opposed to functionalism and capitalism.

According to Aldich and Ruef there are six alternative approaches which can explain certain organisational outcomes:

  • Ecological approach: the ecosystem and resources of a branch or organisation respond the same way as their environment to environmental contingencies.

  • Institutional approach: people take the characteristics of an organisation the way they are. Organisations copy other organisations' behaviour: mimetic isomorphism.

  • Interpretive approach: organisations are socially structured and therefore subjective.

  • Organisational learning: two strands are adaptive learning and knowledge development. Individuals recognise, interpret and use information to fit in with their environment.

  • Resource dependence: organisations are dependent on their environment. Managers have motives to cooperate to ensure their resources.

  • Transaction cost approach: outcomes are a choice between 'market or hierarchy'. Managers have to make the decision between making or buying for each individual transaction.

Morgan presents eight metaphorical lenses for visualising an organisation as:

Positive

  • Machines: orderly relationships, clearly defined logical system with subsystems, predictability and controllability.

  • Organisms: adaption to environment, open system that transforms inputs into outputs, dealing with survival.

  • Brains: having information-processing capacity, strategy formulation, planning processes and management, self-regulation of dispersed intelligence.

  • Cultures: constructed beliefs and interpretations, subjective reality, own language, shared values, norms and mental models.

Negative

  • Political systems: competition, conflict, influencing, power, politicking, own goals vs. organisational goals.

  • Physical prisons: being controlled mentally, constrained thinking, unconsciously getting trapped in web of own creation.

  • Flux and transformation: self-producing system, mutual causality, dialectic change.

  • Instruments of domination: ugly face, external domination of environment and humans, dominating own people.

Theory + Research + Practice = the most complete information for better understanding and managing organisational behaviour.

A good theoretical model:

  • Defines key terms

  • Constructs a conceptual framework that explains how crucial components are interrelated.

  • Gives a starting point for research that creates evidence.

  • Theory and practice lead to practical utilisation.

Five ways to provide insight about OB:

  • Meta analysis: combination of results from various studies to draw a general conclusion.

  • Field study: variables are researched in a real-life stetting.

  • Laboratory study: variables get manipulated and measured in phone situations.

  • Sample survey: a sample of a population group respond to questionnaires.

  • Case study: an extensive study by an individual, group or organisation.

The results from this test can be used in three different ways:

  • Instrumental use: direct application of research findings to practical problems.

  • Conceptual use: professionals acquire general understanding.

  • Symbolic use: outcomes confirm existing conclusions.

Four ways to obtain data in a valid way:

  • Observation: recording the number of times a specified behaviour is exhibited.

  • Questionnaires: ask respondents for their opinions or feelings about work-related issues.

  • Interviews: rely on face-to-face or telephone interactions, ask respondents questions of interest.

  • Indirect methods: obtaining data without any direct contact with respondents.

All research methods can be judged by three variables:

  • Generalisability: are the results of one study applicable for other individuals, groups or situations.

  • Precision in control and management: how accurate the manipulations and measurements are.

  • Realistic content: wether the the context is natural for the participants.

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