write a journal – Achiever Papers

I should write journal every week. there are 2 chapters every week. i will attach the assessment to know what should write about. and i will attach the chapters

first 2 weeks i did not join any group u can mention that then i joined a group and we decide our company is doha bank in kuwait this is the link (https://kw.dohabank.com/)

Assessment 2: Journal

In this unit you will be writing a page of 10 weekly notes in a Word document. You can use the following outline for your topic headings:

1. Your Planning (At the beginning of the week)

a. Individual

b. Group

c. Company

2. Lecture notes (2 per week)

a. What you learn or don’t understand from each chapter of the book.

b. What your group can take from the lecture for your project.

c. What issues are relevant to your company.

3. Meeting Record (Every week either internal group or external company)

a. What you need to do as an individual.

b. Decisions that are made by the group.

c. What you learn from the company.

4. Reflection (At the end of the week)

a. What you are individually learning about the unit.

b. How your group is growing through this process.

c. What you have learnt from the company.

You will submit the completed journal through the link on the Turnitin in the LMS.

Organizational Behavior

Eighteenth Edition, Global Edition

Chapter 1

What Is Organizational Behavior?

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Welcome to this Organizational Behavior course that uses the 18th edition of the textbook, Organizational Behavior by Robbins and Judge. This is considered among the most widely used OB textbooks in the world. Robbins and Judge are recognized as definitive aggregators of OB concepts, applications, and practices. The course and this book will provide you with a resource that will benefit you throughout your degree program and your professional life.
1

Learning Objectives
1.1 Demonstrate the importance of interpersonal skills in the workplace.
1.2 Define organizational behavior (OB).
1.3 Show the value to OB of systematic study.
1.4 Identify the major behavioral science disciplines that contribute to OB.
1.5 Demonstrate why few absolutes apply to OB.
1.6 Identify managers’ challenges and opportunities in applying OB concepts.
1.7 Compare the three levels of analysis in this text’s OB model.
1.8 Describe the key employability skills gained from studying OB applicable to other majors or future careers.

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The first chapter entitled “What is Organizational Behavior,” begins by defining eight learning objectives for the chapter. These lay a foundational understanding for the origins of OB and its applications in management and organizational existence. You should focus on this chapter to ground yourself, and as a starting place for the more complex and significant concepts throughout the book. We will elaborate on each of these objectives to ensure that you acquire a base knowledge of the core OB competencies.
2

Demonstrate the Importance of Interpersonal Skills in the Workplace
Interpersonal skills are important because…
‘Good places to work’ have better financial performance.
Better interpersonal skills result in lower turnover of quality employees and higher quality applications for recruitment.
There is a strong association between the quality of workplace relationships and job satisfaction, stress, and turnover.
It fosters social responsibility awareness.

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Managers need a cadre of skills to create a productive workplace, including technical and quantitative skills. However, leadership and communication skills are critical to organizational success. When managers have solid interpersonal skills, there are positive work outcomes for the organization. These outcomes include lower turnover of strong employees, improved recruitment pools for filling employment positions, and a better bottom line.
3

Describe the Manager’s Functions, Roles, and Skills (1 of 4)
Manager: Someone who gets things done through other people in organizations.
Organization: A consciously coordinated social unit composed of two or more people that functions on a relatively continuous basis to achieve a common goal or set of goals.
Planning, organizing, leading, and controlling.
Mintzberg concluded that managers perform ten different, highly interrelated roles or sets of behaviors attributable to their jobs.

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A manager is someone in the organization who gets things done through the efforts of other people. It is important to keep in mind that an organization is defined as a social entity comprised of two or more people and can be found at any level within the organization.
The work of managers revolves around four functions: planning, organizing, leading, and controlling. When thinking about these functions, one realization comes forward: that they all involve the interpersonal skills of communication for their effective implementation.
Henry Mintzberg looked at management differently when he defined the 10 roles of managers. As shown on the next slide, you will see that they again involve implementation through the interpersonal skills of communication.
4

Describe the Manager’s Functions, Roles, and Skills (2 of 4)
Exhibit 1-1 Minztberg’s Managerial Roles
Role Description
Interpersonal Blank
Figurehead Symbolic head; required to perform a number of routine duties of a legal or social nature
Leader Responsible for the motivation and direction of employees
Liaison Maintains a network of outside contacts who provide favors and information
Informational Blank
Monitor Receives a wide variety of information; serves as nerve center of internal and external information of the organization
Disseminator Transmits information received from outsiders or from other employees to members of the organization

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In fact, if you look at the three categories of roles suggested by Mintzberg – interpersonal, informational, and decisional—you will note the distribution of communication and interpersonal skills such as tact, diplomacy, and the like, focusing on both internal and external audiences in the role’s activities. For this reason, developing the interpersonal skills introduced in this course is essential to the professional development of young professionals and is essential to managerial success.
5

Describe the Manager’s Functions, Roles, and Skills (3 of 4)
[Exhibit 1-1 Continued]
Role Description
Spokesperson Transmits information to outsiders on organization’s plans, policies, actions, and results; serves as expert on organization’s industry
Decisional Searches organization and its environment for opportunities and initiates projects to bring about change
Entrepreneur Responsible for corrective action when organization faces important, unexpected disturbances
Resource allocator Makes or approves significant organizational decisions
Negotiator Responsible for representing the organization at major negotiations

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In fact, if you look at the three categories of roles suggested by Mintzberg—interpersonal, informational, and decisional—you will note the distribution of communication and interpersonal skills such as tact, diplomacy, and the like, focusing on both internal and external audiences in the role’s activities. For this reason, developing the interpersonal skills introduced in this course is essential to the professional development of young professionals and is essential to managerial success.
6

Describe the Manager’s Functions, Roles, and Skills (4 of 4)
Management Skills
Technical Skills – the ability to apply specialized knowledge or expertise. All jobs require some specialized expertise, and many people develop their technical skills on the job.
Human Skills – the ability to work with, understand, and motivate other people.
Conceptual Skills – the mental ability to analyze and diagnose complex situations.

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What skills do managers need to effectively achieve their goals? Researchers have identified several skills that set successful managers apart from their less effective counterparts. These include technical skills, human skills, and conceptual skills.
7

Effective Versus Successful Managerial Activities (1 of 2)
Luthans and his associates found that all managers engage in four managerial activities:
Traditional management
Communication
Human resource management
Networking

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Luthans and his research associates found that all managers engage in four managerial activities.
Traditional management is decision making, planning, and controlling. The average manager spent 32 percent of his or her time performing this activity.
Communication involves exchanging routine information and processing paperwork. The average manager spent 29 percent of his or her time performing this activity.
Human resource management includes motivating, disciplining, managing conflict, staffing, and training. The average manager spent 20 percent of his or her time performing this activity.
Networking is socializing, politicking, and interacting with outsiders. The average manager spent 19 percent of his or her time performing this activity.
8

Effective Versus Successful Managerial Activities (2 of 2)
Exhibit 1-2 Allocation of Activities by Time
Source: Based on F. Luthans, R. M. Hodgetts, and S. A. Rosenkrantz, Real Managers (Cambridge, MA: Ballinger, 1988).

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Managers who were high performing in these activities were found to be fast-tracked through organizational promotion.
9

Define Organizational Behavior
Organizational behavior (OB) is a field of study that investigates the impact that individuals, groups, and structure have on behavior within organizations for the purpose of applying such knowledge toward improving an organization’s effectiveness.

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Organizational behavior (OB) is a field of study that investigates the impact that individuals, groups, and structure have on behavior within organizations for the purpose of applying such knowledge toward improving an organization’s effectiveness. More specifically, OB explores motivation, leader behavior and power, interpersonal communication, group structure and processes, attitude development and perception, change processes, conflict and negotiation, and work design.
10

Complementing Intuition with Systematic Study
Systematic Study of Behavior
Behavior generally is predictable if we know how the person perceived the situation and what is important to him or her.
Evidence-Based Management (EBM)
Complements systematic study.
Argues for managers to make decisions based on evidence.
Intuition
Systematic study and EBM add to intuition, or those “gut feelings” about “why I do what I do” and “what makes others tick.”
If we make all decisions with intuition or gut instinct, we’re likely working with incomplete information.

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Many people say that the ideas and concepts of OB are common sense. However, the systematic study of OB has come closer to finding ways to predict the behavior of individuals and groups through an understanding of the situation and composition of the people. Evidence-based management (EBM) complements systematic study by basing managerial decisions on the best available scientific evidence.
“Intuition” is a decision-making approach advocated by numerous managers and pundits. However, if we make all decisions with intuition or gut instinct, we likely working with incomplete information. EBM and the systematic study of behavior enhance the understanding of these internal contributors to organizational behavior.
11

Big Data
Background:
The use of Big Data for managerial practices is a relatively new area, but one that holds convincing promise.
Current Usage:
The reasons for data analytics include predicting any event, detecting how much risk is incurred at any time, and preventing catastrophes.
New Trends:
The use of Big Data for understanding, helping, and managing people is relatively new but holds promise.
Limitations:
Use evidence as much as possible to inform your intuition and experience.

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The recent availability of “big data” shows promise for the field of OB, potentially providing evidence that can be used to support intuition and experience.
12

Identify the Major Behavioral Science Disciplines That Contribute to OB (1 of 4)
Organizational behavior is an applied behavioral science that is built upon contributions from a number of behavioral disciplines:
Psychology
Social psychology
Sociology
Anthropology

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OB is a behavioral social science that merges concepts from a number of different social sciences to apply specifically to the organizational setting at both the individual (or micro) and group (or macro) levels. The most significant social sciences are psychology, social psychology, sociology, and anthropology. Look at each for a moment.
13

Identify the Major Behavioral Science Disciplines That Contribute to OB (2 of 4)
Exhibit 1-3 Toward an OB Discipline

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This exhibit shows the contributions made by other disciplines to the development of organizational behavior. Notice the predominant areas of psychology, social psychology, sociology, and anthropology. Each of the disciplines has contributed specific concepts and theories to the study of OB and its increasing applications.
14

Identify the Major Behavioral Science Disciplines That Contribute to OB (3 of 4)
Psychology
seeks to measure, explain, and sometimes change the behavior of humans and other animals.
Social psychology
blends the concepts of psychology and sociology.

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Psychology focuses on the individual level by seeking to measure, explain, and sometimes change behaviors in individuals. This area of study offers insights into such areas as learning, training, decision-making, and employee selection.
Social psychology moves beyond individual analysis to look at group behavior and how individuals can influence one another. It blends together sociology and psychology and looks primarily at change, communication, and group interactions.
15

Identify the Major Behavioral Science Disciplines That Contribute to OB (4 of 4)
Sociology
studies people in relation to their social environment or culture.
Anthropology
is the study of societies to learn about human beings and their activities.

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Sociology looks at the relationship between people and their environment. Sociologists’ main contribution to OB has been a better understanding of group behavior, particularly in formal and complex organizations. Another key area that sociologists contribute to in OB is organizational culture, a key factor in OB studies.
Anthropologists study societies to learn about human beings and their activities. They help us understand the differences between different groups in terms of their values, attitudes, and behaviors.
16

Demonstrate Why Few Absolutes Apply to OB
There are few, if any, simple and universal principles that explain organizational behavior.
Contingency variables situational factors are variables that moderate the relationship between the independent and dependent variables.

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There are few absolutes in organizational behavior. When making decisions, you must always take into account the situational factors that can change the relationship between two variables. Every situation has the potential to have unseen factors or even known factors that can change rapidly. Opening your minds to detecting these changes and unseen factors, and to being ready with optional responses, is essential to effective management.
17

Identify the Challenges and Opportunities of OB Concepts (1 of 12)
Exhibit 1-4 Employment Options
Sources: Based on J. R. Anderson, E. Binney, N. M. Davis, G. Kraft, S. Miller, T. Minton-Eversole, . . . and A. Wright, “Action Items: 42 Trends Affecting Benefits, Compensation, Training, Staffing and Technology,” HR Magazine (January 2013): 33; M. Dewhurst, B. Hancock, and D. Ellsworth, “Redesigning Knowledge Work,” Harvard Business Review (January–February 2013): 58–64; E. Frauenheim, “Creating a New Contingent Culture,” Workforce Management (August 2012): 34–39; N. Koeppen, “State Job Aid Takes Pressure off Germany,” The Wall Street Journal, February 1, 2013, A8; and M. A. Shaffer, M. L. Kraimer, Y.-P. Chen, and M. C. Bolino, “Choices, Challenges, and Career Consequences of Global Work Experiences: A Review and Future Agenda,” Journal of Management (July 2012): 1282–1327.

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Today’s economic uncertainty has created new challenges in the workplace. This exhibit shows some of the types of options individuals may have or would like to have.
18

Identify the Challenges and Opportunities of OB Concepts (2 of 12)
Responding to economic pressure
In tough economic times, effective management is an asset.
In good times, understanding how to reward, satisfy, and retain employees is at a premium.
In bad times, issues like stress, decision making, and coping come to the forefront.

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During economic difficulties, the need for effective management is heightened. Anyone can manage during good times; it is much tougher to manage effectively through economic struggles.
In bad economic times, resource constraints may force managers to make tough decisions, such as whether to lay off employees. It can also be difficult to motivate employees when resources are limited. Moreover, managers must be able to deal with employees who are stressed about their futures.
19

Identify the Challenges and Opportunities of OB Concepts (3 of 12)
Responding to globalization
Increased foreign assignments.
Working with people from different cultures.
Overseeing movement of jobs to countries with low-cost labor.
Adapting to differing cultural and regulatory norms.

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Globalization means that organizations now exist in an environment with no national borders. As a result, the manager’s job has changed. Managers today need to have a broader perspective when making decisions.
As foreign assignments increase, you will need to be able to manage a workforce that is different than what you may be used to, and which may bring different needs, aspirations, and attitudes to the workplace.
You will also have individuals who come from different cultures coming to work in your own country. You will need to find ways to accommodate their needs and help them assimilate to your workplace culture.
As more jobs move to countries with low-cost labor, managers will need to balance the needs of their organizations with the needs of the countries in which they operate.
In the new global village, managers need to understand the implications of differing cultural and legal practices on their operations. Violating local regulations and practices could have serious consequences for the organization.
20

Identify the Challenges and Opportunities of OB Concepts (4 of 12)
OB POLL Percentage of Men and Women Working
Sources: Based on U.S. Bureau of Labor Statistics, “Women in the Labor Force: A Datebook,” 2014, www.bls.gov/opub/reports/cps/women-in-the-labor-force-adatabook-2014 ; and U.S. Bureau of Labor Statistics, “Economic News Release,” 2013, http://www.bls.gov/news.release/ecopro.t02.htm.

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As students of OB, we can investigate what factors lead employees to make various choices and how their experiences affect their perceptions of their workplaces. In turn, this can help us predict organizational outcomes. As shown in the OB Poll for example, the days when women stayed home because it was expected are just a memory in some cultures, while in others, women still face significant barriers to entry into the workplace.
21

Identify the Challenges and Opportunities of OB Concepts (5 of 12)
Managing workforce diversity
Workforce diversity – organizations are becoming more heterogeneous in terms of gender, age, race, ethnicity, sexual orientation, and inclusion of Workforce other diverse groups.

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As the borders are disappearing, we are seeing more and more heterogeneity in the workplace. Managers today need to embrace diversity and find ways to manage it effectively. The changing demographics have shifted management philosophy in a way that recognizes and utilizes differences to create productivity, profitability, and welcoming workplace cultures.
22

Identify the Challenges and Opportunities of OB Concepts (6 of 12)
Improving customer service
Service employees have substantial interaction with customers.
Employee attitudes and behavior are associated with customer satisfaction.
Need a customer-responsive culture.

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Many jobs today involve substantial interaction with customers. Managers can increase the chance that these interactions will be successful by focusing on employee attitudes and behavior. Companies need to develop customer-responsive cultures wherein employees are friendly and courteous, accessible, knowledgeable, prompt with their responses, and willing to do what is necessary to ensure that customers are satisfied.
23

Identify the Challenges and Opportunities of OB Concepts (7 of 12)
Improving people skills
People skills are essential to managerial effectiveness.
OB provides the concepts and theories that allow managers to predict employee behavior in given situations.

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Because organizations are composed of people, organizations cannot achieve desired outcomes without them. Therefore, the skills to manage people successfully are essential to the effectiveness of anyone in a managerial or leadership role. OB provides the concepts and theories that help predict behavior to create a more effective organization, accomplishing desired goals.
24

Identify the Challenges and Opportunities of OB Concepts (8 of 12)
Working in networked organizations
Networked organizations are becoming more pronounced.
A manager’s job is fundamentally different in networked organizations.
Challenges of motivating and leading “online” require different techniques.

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Networked organizations are proliferating. These are organizations that are spread over geographic, time, or other boundaries and that are connected by technology. Managing and leading people who never see each other but who work together requires a different set of management and leadership skills.
25

Identify the Challenges and Opportunities of OB Concepts (9 of 12)
Using social media at work
Policies on accessing social media at work.
When, where, and for what purpose.
Impact of social media on employee well-being.

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Social media is a difficult issue for today’s manager, presenting both a challenge and an opportunity for OB.
26

Identify the Challenges and Opportunities of OB Concepts (10 of 12)
Enhancing employee well-being at work
The creation of the global workforce means work no longer sleeps.
Communication technology has provided a vehicle for working at any time or any place.
Employees are working longer hours per week.
The lifestyles of families have changed—creating conflict.
Balancing work and life demands now surpasses job security as an employee priority.

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Because of the expansion of networked business to global competition, time is no longer a definable boundary of organizational activity and personnel responsibility. Managers and leaders of organizations are challenged to help employees find ways to balance work and life roles to ensure they remain effective and viable members of the team. Employees who feel as though they don’t get a break and who believe they must work 24 hours a day can be less effective, suffering from burnout and dissatisfaction.
27

Identify the Challenges and Opportunities of OB Concepts (11 of 12)
Creating a positive work environment
Positive organizational scholarship is concerned with how organizations develop human strength, foster vitality and resilience, and unlock potential.
This field of study focuses on employees’ strengths versus their limitations, as employees share situations in which they performed at their personal best.

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Creating a positive work environment has been found to be a basis for employee satisfaction, increased productivity, and longevity of skilled personnel. Responsibility for positive work environments is not a part of traditional management practice, but as the work environment has changed in terms of characteristics and behaviors of younger generations, the focus on making work a good place to be has become more important for success. Positive organizational scholarship studies what is “good” about organizations.
28

Identify the Challenges and Opportunities of OB Concepts (12 of 12)
Improving ethical behavior
Ethical dilemmas and ethical choices are situations in which an individual is required to define right and wrong conduct.
Good ethical behavior is not so easily defined.
Organizations distribute codes of ethics to guide employees through ethical dilemmas.
Managers need to create an ethically healthy climate.

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Increased scrutiny by society and governmental entities has increased business concerns with ethical behavior. Lapses in ethical behavior have resulted in everything ranging from public sanctions against businesses to legal penalties against a firm and its managers.
Ethical dilemmas require managers to make decisions involving right and wrong conduct. Managers and leaders must clearly define what constitutes appropriate, ethical behavior by the organization and its people, and they must lead by example.
29

Three Levels of Analysis in This Text’s OB Model
Exhibit 1-5 A Basic OB Model

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This book proposes three types of variables—inputs, processes, and outcomes—at three levels of analysis: individual, group, and organizational.
The basic OB model here proceeds from left to right, with inputs leading to processes and processes leading to outcomes. Notice that the model also shows that outcomes can influence inputs in the future.
30

Three Levels of Analysis in This Book’s OB Model (1 of 3)
Inputs
Variables like personality, group structure, and organizational culture that lead to processes.
Group structure, roles, and team responsibilities are typically assigned immediately before or after a group is formed.
Organizational structure and culture change over time.

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Inputs are factors that exist in advance of the employment relationships. For example, individual diversity characteristics, personality, and values are shaped by a combination of an individual’s genetic inheritance and childhood environment.
Group structure, roles, and team responsibilities are typically assigned immediately before or after a group is formed.
Finally, organizational structure and culture are usually the result of years of development and change as the organization adapts to its environment and builds up customs and norms.
31

Three Levels of Analysis in This Book’s OB Model (2 of 3)
Processes
If inputs are like the nouns in organizational behavior, processes are like verbs.
Defined as actions that individuals, groups, and organizations engage in as a result of inputs, and that lead to certain outcomes.

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Processes are actions that individuals, groups, and organizations engage in as a result of inputs, and that lead to certain outcomes.
At the individual level, processes include emotions and moods, motivation, perception, and decision-making.
At the group level, they include communication, leadership, power and politics, and conflict and negotiation.
Finally, at the organizational level, processes include human resource management and change practices.
32

Three Levels of Analysis in This Book’s OB Model (3 of 3)
Outcomes
Key variables that you want to explain or predict, and that are affected by some other variables.

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Scholars have emphasized individual-level outcomes like attitudes and satisfaction, task performance, citizenship behavior, and withdrawal behavior.
At the group level, cohesion and functioning are the dependent variables.
Finally, at the organizational level, we look at overall profitability and survival.
Because these outcomes will be covered in all of the chapters, we will briefly discuss each of them on the following slides, so you can understand what the “goal” of OB will be.
33

Outcome Variables (1 of 6)
Attitudes and stress
Employee attitudes are the evaluations employees make, ranging from positive to negative, about objects, people, or events.
Stress is an unpleasant psychological process that occurs in response to environmental pressures.

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The belief that satisfied employees are more productive than dissatisfied employees has been a basic tenet among managers for years, though only now research has begun to support it. Some people might think that influencing employee attitudes and stress is purely soft stuff, and not the business of serious managers, but as we will show, attitudes often have behavioral consequences that relate directly to organizational effectiveness.
34

Outcome Variables (2 of 6)
Task performance
The combination of effectiveness and efficiency at doing your core job tasks is a reflection of your level of task performance.

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Task performance is the most important human output contributing to organizational effectiveness, so in every chapter we devote considerable time to discussing how task performance is affected by specific topics.
35

Outcome Variables (3 of 6)
Organizational citizenship behavior
The discretionary behavior that is not part of an employee’s formal job requirements, and that contributes to the psychological and social environment of the workplace, is called organizational citizenship behavior.

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In today’s dynamic workplace, where tasks are increasingly performed by teams and flexibility is critical, employees who engage in good citizenship behaviors help others on their team by volunteering for extra work, avoiding unnecessary conflicts, respecting the spirit as well as the letter of rules and regulations, and gracefully tolerating occasional work-related impositions and nuisances.
36

Outcome Variables (4 of 6)
Withdrawal behavior
Withdrawal behavior is the set of actions that employees take to separate themselves from the organization.

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Employee withdrawal can have a very negative effect on an organization. The cost of employee turnover alone has been estimated to run into the thousands of dollars, even for entry-level positions. Absenteeism also costs organizations significant amounts of money and time every year. For instance, a recent survey found the average direct cost to U.S. employers of unscheduled absences is 8.7 percent of payroll.
37

Outcome Variables (5 of 6)
Group cohesion
Group cohesion is the extent to which members of a group support and validate one another at work.
Group functioning
Group functioning refers to the quantity and quality of a group’s work output.

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When employees trust one another, seek common goals, and work together to achieve these common goals, the group is cohesive. Conversely, when employees are divided among themselves in terms of what they want to achieve and have little loyalty to one another, the group is not cohesive. And the greater the group’s cohesion, the greater the effect of group functioning that leads to effective outcomes and satisfying impacts on group members.
38

Outcome Variables (6 of 6)
Productivity
An organization is productive if it achieves its goals by transforming inputs into outputs at the lowest cost. This requires both effectiveness and efficiency.
Survival
The final outcome is organizational survival, which is simply evidence that the organization is able to exist and grow over the long term.

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Popular measures of organizational efficiency include return on investment, profit per dollar of sales, and output per hour of labor. Service organizations must include customer needs and requirements in assessing their effectiveness. These measures of productivity are affected by the behaviors of managers, employees, and supervisors. Increased productivity leads to the ultimate goal of most organizations, which is the survival of the firm.
39

The Plan of the Text
Exhibit 1-6 The Plan of the Text

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As you can see in this exhibit, we will deal with inputs, processes, and outcomes at all three levels of analysis, but we group the chapters as shown here to correspond with the typical ways that research has been done in these areas.
40

Implications for Managers (1 of 2)
Resist the inclination to rely on generalizations; some provide valid insights into human behavior, but many are erroneous.
Use metrics and situational variables rather than “hunches” to explain cause-and-effect relationships.
Work on your interpersonal skills to increase your leadership potential.

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This first chapter has provided a firm foundation that will be the basis for the study and application of concepts and practices that make the young professional more successful in productivity, job satisfaction, and career development. The systematic study of OB can improve predictability of behavior and, while it is not perfect, it provides excellent roadmaps to guide managers and leaders. These studies help to ensure that contingencies are in place to better understand people’s behaviors and how to influence them for the success of the employee and the organization.
41

Implications for Managers (2 of 2)
Improve your technical skills and conceptual skills through training and staying current with OB trends like big data and fast data.
OB can improve your employees’ work quality and productivity by showing you how to empower your employees, design and implement change programs, improve customer service, and help your employees balance work-life conflicts.

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It is important for managers to develop their interpersonal “people skills” to be effective. Understanding OB makes their organizations work more effectively by improving productivity, reducing absenteeism, turnover, and deviant workplace behavior, and increasing organizational citizenship behavior and job satisfaction.
42

Questions?

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Organizational Behavior
Eighteenth Edition, Global Edition
Chapter 2
Diversity in Organizations
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Learning Objectives
2.1 Describe the two major forms of workplace diversity.
2.2 Demonstrate how workplace discrimination undermines organizational effectiveness.
2.3 Describe how the key biographical characteristics are relevant to Organizational Behavior (OB).
2.4 Explain how other differentiating characteristics factor into OB.
2.5 Demonstrate the relevance of intellectual and physical abilities to OB.
2.6 Describe how organizations manage diversity effectively.

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After studying this chapter, you should be able to:
Describe the two major forms of workplace diversity.
Demonstrate how workplace discrimination undermines organizational effectiveness.
Describe how the key biographical characteristics are relevant to OB.
Explain how other differentiating characteristics factor into OB.
Demonstrate the relevance of intellectual and physical abilities to OB.
Describe how organizations manage diversity effectively.
46

Workplace Diversity

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Everyone brings differences to the organizations where they work. These differences can create energy and excitement in the workplace, but they can also cause conflict. So, it is important that we have an understanding of how diversity works in organizations.
When we look at the workplace, we recognize two levels of diversity. Surface-level diversity represents the characteristics that are easily observed such as race, gender, and age. Deep-level diversity represents the aspects that are more difficult to see at first glance such as values, personality, and work preferences.
47

Workplace Discrimination and Organizational Effectiveness (1 of 3)
Discrimination is to note a difference between things.
Unfair discrimination assumes stereotypes about groups.
Refusal to recognize individual differences is harmful to organizations and employees.
Stereotype threat describes the degree to which we agree internally with the generally negative stereotyped perceptions of our groups.
Can be combatted by treating employees as individuals and not highlighting group differences.

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Managing diversity effectively requires working to eliminate unfair discrimination. The act of discrimination means to note differences between things, which isn’t a bad thing. However, when we allow our behavior to be influenced by stereotypes about groups of people, unfair discrimination can be harmful to organizations and employees. Recognizing people for their abilities rather than assumptions of stereotypes is an important part of OB and its application to the work environment.
Stereotype threat has serious implications for the workplace. Stereotype threat can occur during preemployment tests and assessments, performance evaluations, and everyday workplace exchanges. It can lead to underperformance on tests, performance evaluations, training exercises, negotiations, and everyday interactions with others as well as to disengagement, poor job attitudes, a reluctance to seek feedback, and poor performance in the employees experiencing the threat.
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Workplace Discrimination and Organizational Effectiveness (2 of 3)
Exhibit 2-1 Forms of Discrimination
Type of Discrimination Definition Examples from Organizations
Discriminatory policies or practices Actions taken by representatives of the organization that deny equal opportunity to perform or unequal rewards for performance. Older workers may be targeted for layoffs because they are highly paid and have lucrative benefits.
Sexual harassment Unwanted sexual advances and other verbal or physical conduct of a sexual nature that create a hostile or offensive work environment. Salespeople at one company went on company-paid visits to strip clubs, brought strippers into the office to celebrate promotions, and fostered pervasive sexual rumors.
Intimidation Overt threats or bullying directed at members of specific groups of employees. African-American employees at some companies have found nooses hanging over their work stations.
Mockery and insults Jokes or negative stereotypes; sometimes the result of jokes taken too far. Arab-Americans have been asked at work whether they were carrying bombs or were members of terrorist organizations.

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This Exhibit lists definitions and examples of different types of discrimination. Increasing legal scrutiny and social disapproval have reduced most overt forms of discrimination, but less obvious discrimination, like incivility or exclusion, continues to exist. This type of discrimination can be difficult to eliminate because it’s less easily observed, and because it’s not always intentional. Even so, it can have serious negative implications for an organization including reduced productivity, increased turnover, and increased conflict among employees.
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Workplace Discrimination and Organizational Effectiveness (3 of 3)
[Exhibit 2-1 Continued]
Type of Discrimination Definition Examples from Organizations
Exclusion Exclusion of certain people from job opportunities, social events, discussions, or informal mentoring; can occur unintentionally. Many women in finance claim they are assigned to marginal job roles or are given light workloads that don’t lead to promotion.
Incivility Disrespectful treatment, including behaving in an aggressive manner, interrupting the person, or ignoring his or her opinions. Female lawyers note that male attorneys frequently cut them off or do not adequately address their comments.

Sources: Based on J. Levitz and P. Shishkin, “More Workers Cite Age Bias after Layoffs,” The Wall Street Journal, March 11, 2009, D1–D2; W. M. Bulkeley, “A Data-Storage Titan Confronts Bias Claims,” The Wall Street Journal, September 12, 2007, A1, A16; D. Walker, “Incident with Noose Stirs Old Memories,” McClatchy-Tribune Business News, June 29, 2008; D. Solis, “Racial Horror Stories Keep EEOC Busy,” Knight-Ridder Tribune Business News, July 30, 2005, 1; H. Ibish and A. Stewart, Report on Hate Crimes and Discrimination against Arab Americans: The Post-September 11 Backlash, September 11, 2001–October 11, 2001 (Washington, DC: American-Arab Anti-Discrimination Committee, 2003); A. Raghavan, “Wall Street’s Disappearing Women,” Forbes, March 16, 2009, 72–78; and L. M. Cortina, “Unseen Injustice: Incivility as Modern Discrimination in Organizations,” Academy of Management Review 33, no. 1 (2008): 55–75.

Biographical Characteristics and Organizational Behavior (1 of 6)
Biological characteristics are personal characteristics that are objective and easily obtained from personnel records.
Variations in these can be the basis for discrimination

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Biographical characteristics typically include age, gender, and race, and represent many of the surface-level aspects of diversity. We can usually find out about these from personnel records. Because biological characteristics can be the basis for discrimination, it’s important to understand how they are related to work outcomes.
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Biographical Characteristics and Organizational Behavior (2 of 6)
Age
The U.S. workforce is aging.
Does job performance decline with increasing age?
Studies show that turnover and absenteeism rates are lower among older workers, and age is not associated with lower productivity.

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Age is an increasingly relevant characteristic as the workforce is aging. Older workers bring with them a wealth of knowledge and experience, but the misperception is that productivity often declines with age. Whether this is true or not, it is a perception people act upon and will affect the workplace.
52

Biographical Characteristics and Organizational Behavior (3 of 6)
Sex
There are no consistent male-female differences in problem-solving ability, analytical skills, competitive drive, motivation, sociability, or learning drive.
But women earn less than men for the same positions and have fewer professional opportunities.

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Another biological characteristic is sex. In studying gender in the workplace, it has been found that there are very few differences between men and women that impact job performance. However, women still earn less money than men for the same positions and working mothers may face additional bias that limits their professional opportunities.
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Biographical Characteristics and Organizational Behavior (4 of 6)
Race and Ethnicity
Laws against race and ethnic discrimination are in effect in many countries.
But:
Employees tend to favor colleagues of their own race in performance evaluations, promotion decisions, and pay raises.
African Americans generally fare worse than Whites in employment decisions.

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Race is a controversial issue and research shows members of racial and ethnic minorities perceive discrimination in the workplace. More specifically, studies indicate that people in the workplace do identify more with people like themselves; so in some cases, opportunities may be given to people based on the fact that they are like their supervisor, rather than on their merits. Keep in mind, though, that research has found no significant differences in race or ethnic backgrounds related to absence rates, applied social skills, or accident rates, and that discrimination can lead to higher turnover.
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Biographical Characteristics and Organizational Behavior (5 of 6)
Disabilities
The U.S. Equal Employment Opportunity Commission classifies a person as disabled who has any physical or mental impairment that substantially limits one or more major life activities.
Workers with disabilities receive higher performance evaluations, but may have lower performance expectations.

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According to the U.S. Equal Employment Opportunity Commission, a person with a disability is one who has a physical or mental impairment that limits one or more major life activities. The Americans with Disabilities Act of 1990 requires employers to make “reasonable accommodation” for disabilities. Even so, individuals with disabilities continue to face bias in the workplace.
55

Biographical Characteristics and Organizational Behavior (6 of 6)
Hidden Disabilities
Sensory disabilities, chronic illness or pain, cognitive or learning impairments, sleep disorders, and psychological challenges.
U.S. organizations must accommodate employees with a very broad range of impairments.

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As a result of recent changes to the Americans with Disabilities Act Amendments Act of 2008, U.S. organizations must accommodate employees with a very broad range of impairments such as sensory disabilities, chronic illness or pain, cognitive or learning impairments, sleep disorders, and psychological challenges. However, employees must disclose their conditions to their employers in order to be eligible for workplace accommodations and employment protection.
56

Other Characteristics and Organizational Behavior (1 of 2)
Tenure
Tenure is a good predictor of employee productivity.
Tenure and job performance are positively related.
Religion
U.S. law prohibits discrimination based on religion, but it is still an issue, especially for Muslims.

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Tenure refers to the length of time people have been on the job. Tenure is often seen as a positive, as it signifies that people are happy with their employment because they have remained in their job for a long period of time. Therefore, employees with long tenure tend to be more productive, call in sick less frequently, and don’t leave the organization as readily.
Discrimination based on religion is prohibited in the United States; however, it continues to be an issue in the workplace. Muslims in particular may face discrimination, but bias against other religious beliefs exists as well. In fact, religious discrimination claims represent an increasing share of all discrimination claims in the United States.
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Other Characteristics and Organizational Behavior (2 of 2)
Sexual Orientation and Gender Identity
Federal law does not protect employees against discrimination based on sexual orientation, though many states and municipalities do.
Many Fortune 500 companies have policies covering sexual orientation and about half now have policies on gender identity.
Cultural Identity
Need to accommodate and respect individual cultural identities.

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Sexual orientation and gender identity are not protected by federal law and as a result, they are handled differently by most employers. These characteristics are often dealt with as if they are federally protected characteristics even though they are not, in order to discourage discriminatory behavior. For example, about 90 percent of Fortune 500 companies have policies on sexual orientation and roughly half have policies on gender identity. This is a big change from just a few years ago, and there are indications that legislation may soon be in place to protect gay, lesbian, bisexual, and transgender employees.
Finally, it is important for companies to respect and accommodate the cultural identities of their employees.

Intellectual and Physical Abilities and OB (1 of 5)
Ability is an individual’s current capacity to perform various tasks in a job.
Two types
Intellectual abilities
Physical abilities

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Ability is an individual’s capacity to perform job tasks. An individual’s overall abilities are composed of intellectual abilities and physical abilities.
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Intellectual and Physical Abilities and OB (2 of 5)
Intellectual abilities are abilities needed to perform mental activities – thinking, reasoning, and problem solving.
Most societies place a high value on intelligence.
General mental ability is an overall factor of intelligence as suggested by the positive correlations among specific intellectual ability dimensions.

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Intellectual abilities are those needed to perform mental activities. These would include abilities such as critical thinking, reasoning, and problem-solving. In most cultures, high value is placed on intelligence and it is easy to see why. Smart people tend to earn more money, attain higher levels of education, and be leaders.
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Intellectual and Physical Abilities and OB (3 of 5)
Exhibit 2-2 Dimensions of Intellectual Ability
Dimension Description Job Example
Number aptitude Ability to do speedy and accurate arithmetic Accountant: Computing the sales tax on a set of items
Verbal comprehension Ability to understand what is read or heard and the relationship of words to each other Plant manager: Following corporate policies on hiring
Perceptual speed Ability to identify visual similarities and differences quickly and accurately Fire investigator: Identifying clues to support a charge of arson
Inductive reasoning Ability to identify a logical sequence in a problem and then solve the problem Market researcher: Forecasting demand for a product in the next time period
Deductive reasoning Ability to use logic and assess the implications of an argument Supervisor: Choosing between two different suggestions offered by employees
Spatial visualization Ability to imagine how an object would look if its position in space were changed Interior decorator: Redecorating an office
Memory Ability to retain and recall past experiences Salesperson: Remembering the names of customers

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The seven most frequently cited dimensions making up intellectual abilities are number aptitude, verbal comprehension, perceptual speed, inductive reasoning, deductive reasoning, spatial visualization, and memory.
Exhibit 2-2 describes these dimensions. If you score high on verbal comprehension, you’re more likely to also score high on spatial visualization. Evidence strongly supports the idea that the structures and measures of intellectual abilities generalize across cultures.
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Intellectual and Physical Abilities and OB (4 of 5)
Physical Abilities
The capacity to do tasks demanding stamina, dexterity, strength, and similar characteristics.
Nine basic abilities related to strength, flexibility, and other factors are needed to perform physical tasks.

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Physical abilities are needed when performance requires physical activity to complete a task. Research has identified nine basic abilities that are needed to perform physical tasks—they are shown in the following slide. Managers need to identify which of these abilities are necessary for specific jobs, and then ensure that people in those jobs have the necessary abilities to do their jobs successfully.
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Intellectual and Physical Abilities and OB (5 of 5)
Exhibit 2-3 Nine Basic Physical Abilities
Strength Factors Blank
1. Dynamic strength Ability to exert muscular force repeatedly or continuously over time
2. Trunk strength Ability to exert muscular strength using the trunk (particularly abdominal) muscles
3. Static strength Ability to exert force against external objects
4. Explosive strength Ability to expend a maximum of energy in one or a series of explosive acts
Flexibility Factors Blank
5. Extent flexibility Ability to move the trunk and back muscles as far as possible
6. Dynamic flexibility Ability to make rapid, repeated flexing movements
Other Factors Blank
7. Body coordination Ability to coordinate the simultaneous actions of different parts of the body
8. Balance Ability to maintain equilibrium despite forces pulling off balance
9. Stamina Ability to continue maximum effort requiring prolonged effort over time

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Exhibit 2-3 shows the nine basic physical abilities needed to perform physical tasks. Strength factors include dynamic strength, trunk strength, static strength, and explosive strength. Flexibility factors include both components of extent flexibility and dynamic flexibility. Other factors include body coordination, balance, and stamina.

Describe How Organizations Manage Diversity Effectively (1 of 6)
Diversity management is the process and programs by which managers make everyone more aware of and sensitive to the needs and differences of others.
Diversity is more successful when it is everyone’s business, not just for certain groups of employees.

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Diversity management makes everyone more aware of and sensitive to the needs and differences of others. Diversity management programs are more successful when they are the norm for everyone, rather than just for certain groups of employees.
64

Describe How Organizations Manage Diversity Effectively (2 of 6)

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Managing diversity effectively begins by attracting, selecting, developing, and retaining employees who can operate and excel in a workplace with diverse individuals, viewpoints, and ideas. These efforts are then complemented by effectively managing diversity in groups and ensuring that strong diversity programs are in place.
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Describe How Organizations Manage Diversity Effectively (3 of 6)
Attracting, selecting, developing, and retaining diverse employees
Target recruiting messages to specific demographic groups.
Some companies have been actively working toward recruiting less-hired groups.

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Attracting, selecting, developing, and retaining diverse employees are important to the process. Recruiting messages should be targeted to specific demographic groups that are underrepresented in the workforce.
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Describe How Organizations Manage Diversity Effectively (4 of 6)
Diversity in Groups
Most people in groups need a common way of looking at and accomplishing major tasks, and they need to communicate well with each other.
Emphasize higher-level similarities among people.

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Working in group settings is common in most contemporary workplaces. To be effective members of a group, employees need a common way of looking at and accomplishing major tasks, as well as good communication skills. Emphasizing higher-level similarities can also increase the effectiveness of groups.
67

Describe How Organizations Manage Diversity Effectively (5 of 6)
Expatriate Adjustment
Organizations should select employees for international assignments who are capable of adjusting quickly and ensure they have the support they need for their assignment.

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Several factors should be targeted to help the adjustment process for expatriates.
Feelings of empowerment along with the motivation to interact with those of other cultures were found in to be related to adjustment, satisfaction, and reduced intentions to leave prematurely.
Those with previous culture-specific work experience as well as higher self-esteem and self-efficacy tend to adjust and be promoted more quickly.
Several other factors work in concert to affect different forms of adjustment, including language ability, relational skills, role clarity and autonomy, organizational support, and familial support.
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Describe How Organizations Manage Diversity Effectively (6 of 6)
Effective diversity programs
Teach managers about the legal framework for equal employment opportunity and encourage fair treatment of all people.
Teach managers how a diverse workforce will be more effective at serving a diverse customer base.
Foster personal development practices that bring out the skills and abilities of everyone.

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Effective diversity programs have three components. First, they teach managers about the legal framework for equal employment opportunity and encourage fair treatment of all people regardless of their demographic characteristics. Second, they teach managers how a diverse workforce will be better able to serve a diverse market of customers and clients. Finally, they foster personal development practices that bring out the skills and abilities of all workers, acknowledging how differences in perspective can be a valuable way to improve performance for everyone.
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Implications for Managers
Understand your organization’s anti-discrimination policies thoroughly and share them with your employees.
Assess and challenge your own stereotype beliefs to increase your objectivity.
Look beyond readily observable biographical characteristics and consider the individual’s capabilities before making management decisions.
Fully evaluate what accommodations a person with disabilities will need and then fine-tune a job to that person’s abilities.
Seek to understand and respect the unique biographical characteristics of your employees; a fair but individualistic approach yields the best performance.

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Understand your organization’s anti-discrimination policies thoroughly and share them with your employees.
Assess and challenge your stereotype beliefs to increase your objectivity.
Look beyond readily observable biographical characteristics and consider the individual’s capabilities before making management decisions.
Fully evaluate what accommodations a person with disabilities will need and then fine-tune a job to that person’s abilities.
Seek to understand and respect the unique biographical characteristics of your employees; a fair but individualistic approach yields the best performance.
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Questions?

Organizational Behavior

Eighteenth Edition, Global Edition

Chapter 3

Attitudes and Job Satisfaction

Learning Objectives
3.1 Contrast the three components of an attitude.
3.2 Summarize the relationship between attitudes and behavior.
3.3 Compare the major job attitudes.
3.4 Define job satisfaction.
3.5 Summarize the main causes of job satisfaction.
3.6 Identify three outcomes of job satisfaction.
3.7 Identify four employee responses to dissatisfaction.

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After studying this chapter, you should be able to:
Contrast the three components of an attitude.
Summarize the relationship between attitudes and behavior.
Compare the major job attitudes.
Define job satisfaction.
Summarize the main causes of job satisfaction.
Identify three outcomes of job satisfaction.
Identify four employee responses to dissatisfaction.
2

Contrast the Three Components of an Attitude (1 of 2)
Attitudes are evaluative statements—either favorable or unfavorable—about objects, people, or events.
They reflect how we feel about something.

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Attitudes are evaluative statements or judgments concerning objects, people, or events. They reflect how we feel about something. In other words, saying “I like my job”, reflects your attitude toward work.
3

Contrast the Three Components of an Attitude (2 of 2)
Exhibit 3-1 The Components of an Attitude

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Attitudes are made up of three components. The cognitive component is the belief in the way things are. The affective component is the more critical part of the attitude, as it is calls upon emotions or feelings. The behavioral component describes the intention to behave in a certain way toward someone or something.
These three components work together to aid in our understanding of the complexity of an attitude.
4

Summarize the Relationship Between Attitudes and Behavior (1 of 2)
The attitudes that people hold determine what they do.
Festinger: cases of attitude following behavior illustrate the effects of cognitive dissonance.
Cognitive dissonance is any incompatibility an individual might perceive between two or more attitudes or between behavior and attitudes.
Research has generally concluded that people seek consistency among their attitudes and between their attitudes and their behavior.

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Early research assumed that attitudes were causally related to behavior. One researcher, Leon Festinger, argued that attitudes follow behavior. Sometimes we observe people who will change what they say so it doesn’t contradict their behavior. When attitudes and behaviors don’t line up, individuals will experience cognitive dissonance. This incongruity is uncomfortable and individuals will seek to reduce the dissonance to find consistency.
People are willing to live with some discomfort, but the degree to which this is true depends on the importance of the elements, how much influence the individual has on the situation, and the rewards available.
5

Summarize the Relationship Between Attitudes and Behavior (2 of 2)
Moderating Variables:
Attitude’s importance
Correspondence to behavior
Accessibility
Presence of social pressures
Whether a person has direct experience with the attitude
The attitude-behavior relationship is likely to be much stronger if an attitude refers to something with which we have direct personal experience.

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Some variables moderate the relationship between attitude and behavior. These variables include the importance of the attitude to the person, the correspondence of the attitude to the behavior, the accessibility of the attitude, the presence of social pressures on behavior, and the direct experience a person has with the attitude. These mitigating variables will affect whether or not and to what degree a certain attitude will predict behavior.
Finally, the attitude–behavior relationship is likely to be much stronger if an attitude refers to something with which we have direct personal experience.
6

Compare the Major Job Attitudes (1 of 5)
Job Satisfaction
A positive feeling about the job resulting from an evaluation of its characteristics.
Job Involvement
Degree to which a person identifies with a job, actively participates in it, and considers performance important to self-worth.
Psychological Empowerment
Belief in the degree of influence over one’s job, competence, job meaningfulness, and autonomy.

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Most of the research in OB has been concerned with three major job attitudes: job satisfaction, job involvement, and organizational commitment. In addition, perceived organizational support and employee engagement are important.
Job satisfaction is the positive feeling about the job resulting from an evaluation of its characteristics.
Job involvement looks at the degree of psychological identification with the job. Related to this is psychological empowerment, which is defined as employees’ beliefs in the degree to which they influence their work environment, their competencies, the meaningfulness of their job, and their perceived autonomy.
7

Compare the Major Job Attitudes (2 of 5)
Organizational Commitment
Identifying with a particular organization and its goals and wishing to maintain membership in the organization.
Employees who are committed will be less likely to engage in work withdrawal even if they are dissatisfied, because they have a sense of organizational loyalty.

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Another important job attitude is organizational commitment, which is defined as the act of identifying with a particular organization and its goals, and wishing to remain a member of the organization.
8

Compare the Major Job Attitudes (3 of 5)
Perceived Organizational Support (POS)
Degree to which employees believe the organization values their contribution and cares about their well-being.
Higher when rewards are fair, employees are involved in decision making, and supervisors are seen as supportive.
POS is important in countries where power distance is lower.

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Perceived organizational support (or POS) is the degree to which employees believe the organization values their contribution and cares about their well-being. The perception of fairness is a key factor in determining the willingness of employees to work hard for the organization. In addition, employees have a higher POS when they perceive that they have some input in decision making processes.
POS is important in countries where power distance, the degree to which people in a country accept that power in institutions and organizations is distributed unequally, is lower.
9

Compare the Major Job Attitudes (4 of 5)
Employee Engagement
The individual’s involvement with, satisfaction with, and enthusiasm for the work.
Engaged employees are passionate about their work and company.

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Employee engagement goes beyond just job satisfaction. It also includes involvement and enthusiasm for the job. Highly engaged employees have a passion for their work and feel a deep connection to their company. Disengaged employees have essentially checked out—putting time but not energy or attention into their work.
Engagement is a real concern for most organizations because surveys indicate that few—between 17 percent and 29 percent—are highly engaged by their work. Engagement is a very general concept, perhaps broad enough to capture the intersection of the other variables we’ve discussed. In other words, it may be what these attitudes have in common.
10

Compare the Major Job Attitudes (5 of 5)
Are these job attitudes really all that distinct?
No, these attitudes are highly related; and while there is some distinction, there is also a lot of overlap that may cause confusion.

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There is a high degree of overlap between the different job attitudes. For example, if a worker has higher job satisfaction, he or she tends to be more engaged and show a stronger commitment to the organization. Researchers are trying to find ways to measure the different attitudes in order to get at their distinctiveness.
11

Define Job Satisfaction (1 of 5)
Exhibit 3-2 Worst Jobs of 2016 for Job Satisfaction*
*Based on physical demands, work environment, income, stress, and hiring outlook.
Source: Based on CareerCast.com (2016), http://www.careercast.com/jobs-rated/worst-jobs-2016.

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When it comes to job satisfaction, some jobs are less attractive, as shown in Exhibit 3-2.
12

Define Job Satisfaction (2 of 5)
Job Satisfaction
A positive feeling about a job resulting from an evaluation of its characteristics.
Two approaches for measuring job satisfaction are popular
The single global rating.
The summation of job facets.

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As we have discussed, job satisfaction is defined as a positive feeling about a job resulting from an evaluation of its characteristics. There are multiple ways to measure job satisfaction, but two approaches are popular.
The single global rating approach is a response to one question, such as, “All things considered, how satisfied are you with your job?” Respondents circle a number between 1 and 5 on a scale from “highly satisfied” to “highly dissatisfied.”
The second approach, the summation of job facets, is more sophisticated. It identifies key elements in a job, such as the nature of the work, supervision, present pay, promotion opportunities, and relations with coworkers.
13

Define Job Satisfaction (3 of 5)
How satisfied are people in their jobs?
Over the last 30 years, employees in the U.S. and most developed countries have generally been satisfied with their jobs.
With the recent economic downturn, more workers are less satisfied.
Satisfaction levels differ depending on the facet involved.
There are cultural differences in job satisfaction.

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Research shows that over the past 30 years, the majority of U.S. workers have been satisfied with their jobs. However, the recent economic downturn has generated a dramatic drop-off in satisfaction levels, with just half of workers reporting feeling satisfied now.
The exhibits on the following two slides illustrate additional details regarding differences among job satisfaction, including the affect of particular facets and cultural context.
14

Define Job Satisfaction (4 of 5)
Exhibit 3-3 Average Job Satisfaction Levels by Facet

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As shown here in Exhibit 3-3, people have typically been more satisfied with their jobs overall, with the work itself, and with their supervisors and coworkers, than they have been with their pay and promotion opportunities.
15

Define Job Satisfaction (5 of 5)
Exhibit 3-4 Average Levels of Employee Job Satisfaction by Country
Source: Based on J. H. Westover, “The Impact of Comparative State-Directed Development on Working Conditions and Employee Satisfaction,” Journal of Management & Organization 19, no. 4 (2013): 537–54.

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Exhibit 3-4 provides results of a global study of job satisfaction levels of workers in 15 countries. Mexico and Switzerland report the highest levels of job satisfaction.
16

Summarize the Main Causes of Job Satisfaction (1 of 3)
What causes job satisfaction?
Job conditions
The intrinsic nature of the work itself, social interactions, and supervision are important predictors of satisfaction and employee well-being.
Personality
People who have positive core self-evaluations, who believe in their inner worth and basic competence, are more satisfied with their jobs than those with negative core self-evaluations.

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Interesting jobs that provide training, variety, independence, and control satisfy most employees. There is also a strong correspondence between how well people enjoy the social context of their workplace and how satisfied they are overall. Interdependence, feedback, social support, and interaction with coworkers outside the workplace are strongly related to job satisfaction even after accounting for characteristics of the work itself.
Personality also plays a role in job satisfaction. Research has shown that people who have positive core self-evaluations, who believe in their inner worth and basic competence, are more satisfied with their jobs than those with negative core self-evaluations.
Pay also has an influence on job satisfaction but not as much as one might think. We’ll look at it in the next slide.
17

Summarize the Main Causes of Job Satisfaction (2 of 3)
Exhibit 3-5 Relationship between Average Pay in Job and Job Satisfaction of Employees in That Job
Source: Based on T. A. Judge, R. F. Piccolo, N. P. Podsakoff, J. C. Shaw, and B. L. Rich, “The Relationship between Pay and Job Satisfaction: A Meta-Analysis of the Literature,” Journal of Vocational Behavior 77, no. 2 (2010): 157–67.

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Exhibit 3-5 shows the relationship between the average pay for a job and the average level of job satisfaction. Once an individual reaches a level of comfortable living (in the United States, that occurs at about $40,000 a year, depending on the region and family size), the relationship between pay and job satisfaction virtually disappears. Money does motivate people, as we will discover in Chapter 6, but what motivates us is not necessarily the same as what makes us happy.
18

Summarize the Main Causes of Job Satisfaction (3 of 3)
Corporate Social Responsibility (CSR)
Corporate social responsibility (CSR): self-regulated actions to benefit society or the environment beyond what is required by law.
Includes environmental sustainability initiatives, nonprofit work, and charitable giving.
Increasingly affects employee job satisfaction.
CSR is particularly important for Millennials.
But, not everyone finds value in CSR.

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An organization’s commitment to corporate social responsibility (CSR), or its self-regulated actions to benefit society or the environment beyond what is required by law, increasingly affects employee job satisfaction. Organizations practice CSR in a number of ways, including environmental sustainability initiatives, nonprofit work, and charitable giving.
The relationship between CSR and job satisfaction is particularly strong for Millennials.
Although the link between CSR and job satisfaction is strengthening, not all employees find value in CSR. Therefore, organizations need to address a few issues in order to be most effective:
First, not all projects are equally meaningful for every person’s job satisfaction, yet participation for all employees is sometimes expected.
Second, some organizations require employees to contribute in a prescribed manner.
Third, CSR measures can seem disconnected from the employee’s actual work, providing no increase to job satisfaction.
19

Outcomes of Job Satisfaction
Job Performance
Happy workers are more likely to be productive workers.
OCB
People who are more satisfied with their jobs are more likely to engage in OCB.
Customer Satisfaction
Satisfied employees increase customer satisfaction and loyalty.
Life Satisfaction
Research shows that job satisfaction is positively correlated with life satisfaction.

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Now, let’s look at specific outcomes of job satisfaction related to job performance, OCB, customer satisfaction, and life satisfaction.
Job Performance: Happy workers are more likely to be productive workers—the evidence suggests that productivity is likely to lead to satisfaction.
Organizational Citizenship Behavior (OCB): It seems logical to assume job satisfaction should be a major determinant of an employee’s organizational citizenship behavior (OCB). Finally, research shows that when people are more satisfied with their jobs, they are more likely to engage in OCBs.
Customer Satisfaction: Evidence indicates that satisfied employees increase customer satisfaction and loyalty.
Life Satisfaction: Research in Europe indicated that job satisfaction is positively correlated with life satisfaction, and your attitudes and experiences in life spill over in to your job approaches and experiences. Furthermore, life satisfaction decreases when people become unemployed.
20

Four Employee Responses to Dissatisfaction (1 of 2)
Exhibit 3-6 Responses to Dissatisfaction from

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What happens when employees dislike their jobs? The exit–voice–loyalty–neglect framework shown in Exhibit 3-6 is helpful for understanding the consequences of dissatisfaction.
The exhibit illustrates employees’ four responses to job dissatisfaction, which differ along two dimensions: constructive/destructive and active/passive.
The responses are as follows:
Exit. The exit response directs behavior toward leaving the organization, including looking for a new position or resigning.
Voice. The voice response includes actively and constructively attempting to improve conditions, including suggesting improvements, discussing problems with superiors, and undertaking union activity.
Loyalty. The loyalty response means passively but optimistically waiting for conditions to improve, including speaking up for the organization in the face of external criticism and trusting the organization and its management to “do the right thing.”
Neglect. The neglect response passively allows conditions to worsen and includes chronic absenteeism or lateness, reduced effort, and increased error rate.
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Four Employee Responses to Dissatisfaction (2 of 2)
Counterproductive Work Behavior (CWB)
Counterproductive work behavior: actions that actively damage the organization, including stealing, behaving aggressively toward coworkers, or being late or absent.
Absenteeism: the more satisfied you are, the less likely you are to miss work.
Turnover: a pattern of lowered job satisfaction is the best predictor of intent to leave.
Managers Often “Don’t Get It”

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In addition, we can look at job dissatisfaction by exploring counterproductive work behavior. Substance abuse, stealing at work, undue socializing, gossiping, absenteeism, and tardiness are examples of behaviors that are destructive to organizations.
They are indicators of a broader syndrome called counterproductive work behavior (CWB), also termed deviant behavior in the workplace, or simply employee withdrawal. CWB doesn’t just happen—the behaviors often follow negative and sometimes longstanding attitudes. Generally, job dissatisfaction predicts CWB. People who are not satisfied with their work become frustrated, which lowers their performance and makes them more likely to commit CWB. Other research suggests that, in addition to vocational misfit (being in the wrong line of work), lack of fit with the organization (working in the wrong kind of organizational culture) also predicts CWBs.
As a manager, you can take steps to mitigate CWB. You can poll employee attitudes, for instance, and identify areas for workplace improvement. If there is no vocational fit, the employee will not be fulfilled, so you can screen for that. Tailoring tasks so a person’s abilities and values can be exercised should increase job satisfaction and reduce CWB. Furthermore, creating strong teams, integrating supervisors with them, providing formalized team policies, and introducing team-based incentives may help lower the CWB “contagion” that lowers the standards of the group.
Absenteeism: We find a consistent negative relationship between satisfaction and absenteeism. The more satisfied you are, the less likely you are to miss work.
Turnover: Satisfaction is also negatively related to turnover, but the correlation is stronger than what we found for absenteeism.
Workplace Deviance: Job dissatisfaction predicts unionization, stealing, undue socializing, and tardiness. If employees don’t like their work environment, they will respond somehow.
Managers Often “Don’t Get It”
It should come as no surprise that job satisfaction can affect the bottom line. Regular surveys can reduce gaps between what managers think employees feel and what they really feel.
22

Implications for Managers (1 of 2)
Of the major job attitudes – job satisfaction, job involvement, organizational commitment, perceived organizational support (POS), and employee engagement – remember that an employee’s job satisfaction level is the best single predictor of behavior.
Pay attention to your employees’ job satisfaction levels as determinants of their performance, turnover, absenteeism, and withdrawal behaviors.

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Creating a satisfied workforce is not a guarantee of successful performance, but managers should make it a priority as much as possible. In particular, managers should:
Of the major job attitudes—job satisfaction, job involvement, organizational commitment, perceived organizational support (POS), and employee engagement—remember that an employee’s job satisfaction level is the best single predictor of behavior.
Pay attention to employees’ job satisfaction levels as determinants of their performance, turnover, absenteeism, and withdrawal behaviors.
23

Implications for Managers (2 of 2)
Measure employee job attitudes objectively and at regular intervals to determine how employees are reacting to their work.
To raise employee satisfaction, evaluate the fit between the employee’s work interests and the intrinsic parts of his/her job to create work that is challenging and interesting to the individual.
Consider the fact that high pay alone is unlikely to create a satisfying work environment.

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Measure employee job attitudes objectively and at regular intervals to determine how employees are reacting to their work.
Evaluate the fit between the employee’s work interests and the intrinsic parts of his/her job to create work that is challenging and interesting to the individual.
Consider the fact that high pay alone is unlikely to create a satisfying work environment.
24

Questions

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Organizational Behavior
Eighteenth Edition, Global Edition
Chapter 4
Personality and Values
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Learning Objectives (1 of 2)
4.1 Describe personality, the way it is measured, and the factors that shape it.
4.2 Describe the strengths and weaknesses of the Myers-Briggs Type Indicator (MBTI) personality framework and the Big Five model.
4.3 Discuss how the concepts of core self-evaluation (CSE), self-monitoring, and proactive personality contribute to the understanding of personality.
4.4 Describe how personality affects job search and unemployment.

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After studying this chapter, you should be able to:
Describe personality, the way it is measured, and the factors that shape it.
Describe the strengths and weaknesses of the Myers-Briggs Type Indicator personality framework and the Big Five model.
Discuss how the concepts of core self-evaluation (CSE), self-monitoring, and proactive personality contribute to the understanding of personality.
Describe how personality affects job search and unemployment.
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Learning Objectives (2 of 2)
4.5 Describe how the situation affects whether personality predicts behavior.
4.6 Contrast terminal and instrumental values.
4.7 Describe the differences between person-job fit and person-organization fit.
4.8 Compare Hofstede’s five value dimensions and the GLOBE framework.

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Additional objectives for this chapter.
Describe how the situation affects whether personality predicts behavior.
Contrast terminal and instrumental values.
Describe the differences between person-job fit and person-organization fit.
Compare Hofstede’s five value dimensions and the GLOBE framework.
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Describe Personality, the Way It Is Measured, and the Factors that Shape It (1 of 4)
Defining Personality
Personality is a dynamic concept describing the growth and development of a person’s whole psychological system.
The sum of ways in which an individual reacts to and interacts with others.

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We begin by defining personality. Personality is a dynamic concept, meaning it is changing all the time. It describes the total of growth and development of a person’s whole psychological system. The text definition is that personality is the sum of ways in which an individual reacts to and interacts with others.
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Describe Personality, the Way It Is Measured, and the Factors that Shape It (2 of 4)
Measuring Personality
Managers need to know how to measure personality.
Personality tests are useful in hiring decisions and help managers forecast who is best for a job.
The most common means of measuring personality is through self-report surveys.

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One of the greatest challenges in the study of personality is its measurement. Managers need to know how to measure personality because accurately measuring personality gives managers an advantage in the recruitment and hiring processes. Typically, personality is measured using self-report surveys.
Research indicates our culture influences the way we rate ourselves. People in individualistic countries trend toward self-enhancement, while people in collectivist countries such as Taiwan, China, and South Korea trend toward self-diminishment.
Observer-ratings surveys provide an independent assessment of personality. Here, a coworker or another observer does the rating.
Though the results of self-reports and observer-ratings surveys are strongly correlated, research suggests observer-ratings surveys predict job success more than self-ratings alone.
However, each can tell us something unique about an individual’s behavior, so a combination of self-reports and observer reports predicts performance better than any one type of information.
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Describe Personality, the Way It Is Measured, and the Factors that Shape It (3 of 4)
Personality Determinants
Is personality the result of heredity or environment?
Heredity refers to those factors that were determined at conception.
The heredity approach argues that the ultimate explanation of an individual’s personality is the molecular structure of the genes, located in the chromosomes.

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An early argument centered on whether or not personality was the result of heredity or environment. Personality appears to be a result of both influences. Heredity refers to those factors that were determined at conception. The heredity approach argues that the ultimate explanation of an individual’s personality is the molecular structure of the genes, located in the chromosomes.
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Describe Personality, the Way It Is Measured, and the Factors that Shape It (4 of 4)
Early research tried to identify and label enduring personality characteristics.
Shy, aggressive, submissive, lazy, ambitious, loyal, and timid.
These are personality traits.

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Popular characteristics include shy, aggressive, submissive, lazy, ambitious, loyal, and timid. These are personality traits. The more consistent the characteristic over time, and the more frequently it occurs in diverse situations, the more important the trait is in describing the individual.
33

Strengths and Weakness of the MBTI and Big Five Model (1 of 7)
The most widely used personality framework is the Myers-Briggs Type Indicator (MBTI).
Individuals are classified as:
Extroverted or Introverted (E or I)
Sensing or Intuitive (S or N)
Thinking or Feeling (T or F)
Perceiving or Judging (P or J)
INTJs are visionaries.
ESTJs are organizers.
ENTPs are conceptualizers.

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The most widely used personality framework is the Myers-Briggs Type Indicator (MBTI). Individuals are classified as Extroverted or Introverted (E or I), Sensing or Intuitive (S or N), Thinking or Feeling (T or F), and Perceiving or Judging (P or J). These classifications are then combined into 16 personality types.
INTJs are visionaries. They usually have original minds and great drive. They are characterized as skeptical, critical, independent, determined, and often stubborn.
ESTJs are organizers. They are realistic, logical, analytical, decisive, and have a natural head for business or mechanics.
ENTPs are conceptualizers. They are innovative, individualistic, versatile, and attracted to entrepreneurial ideas. They tend to be resourceful in solving challenging problems but may neglect routine assignments.
MBTI is widely used. It is taken by over 2.5 million people each year and 89 of the Fortune 100 companies use it.
34

Strengths and Weakness of the MBTI and Big Five Model (2 of 7)
The Big Five Model
Extraversion
Agreeableness
Conscientiousness
Emotional stability
Openness to experience

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An impressive body of research supports that five basic dimensions underlie all other personality dimensions. The five basic dimensions are extraversion, agreeableness, conscientiousness, emotional stability, and openness to experience. Let’s look at each of these for a minute.
Extraversion is a comfort level with relationships. Extroverts tend to be gregarious, assertive, and sociable. Introverts tend to be reserved, timid, and quiet.
Agreeableness is an Individual’s propensity to defer to others. People who are high on agreeableness are cooperative, warm, and trusting. Low agreeableness is indicated by people who are cold, disagreeable, and antagonistic.
Conscientiousness is a measure of reliability. A highly conscientious person is responsible, organized, dependable, and persistent. Those who score low on this dimension are easily distracted, disorganized, and unreliable.
Emotional stability describes a person’s ability to withstand stress. People with positive emotional stability tend to be calm, self-confident, and secure. Those with high negative scores tend to be nervous, anxious, depressed, and insecure.
And lastly, openness to experience suggests the range of interests and fascination with novelty. Extremely open people are creative, curious, and artistically sensitive. Those at the other end of the openness category are conventional and find comfort in the familiar.
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Strengths and Weakness of the MBTI and Big Five Model (3 of 7)
Exhibit 4-1 Traits That Matter Most to Business Success at Buyout Companies
Most Important Less Important
Persistence Strong oral communication
Attention to detail Teamwork
Efficiency Flexibility/adaptability
Analytical skills Enthusiasm
Setting high standards Listening skills

Source: Based on S. N. Kaplan, M. M. Klebanov, and M. Sorensen, “Which CEO Characteristics and Abilities Matter?” The Journal of Finance 67, no. 3 (2012): 973–1007.

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Exhibit 5-1 shows the results of research on personality scores of CEO candidates. The study found that conscientiousness—in the form of persistence, attention to detail, and setting of high standards—was more important than other traits. These results attest to the importance of conscientiousness to organizational success. Although conscientiousness is the best predictor of job performance, other traits are also important.
36

Strengths and Weakness of the MBTI and Big Five Model (4 of 7)
Exhibit 4-2 Model of How Big Five Traits Influence OB Criteria

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All five traits also have other implications for work and for life. Let’s look at these one at a time. Exhibit 5-2 summarizes the points.
Of the Big Five traits, emotional stability is most strongly related to life satisfaction, job satisfaction, and reduced intentions to quit and burnout.
People with high emotional stability can adapt to unexpected or changing demands in the workplace.
Extraversion is a relatively strong predictor of leadership emergence and behaviors in groups. Extraverts also tend to have generally high job satisfaction and reduced burnout. Some negatives are that extraverts can appear to be self-aggrandizing, egoistic, or too dominating and that their social behavior can be disadvantageous for jobs that do not require frequent social interaction.
Individuals who score high on openness to experience are more likely to be effective leaders and are more comfortable with ambiguity. They cope better with organizational change and are more adaptable in changing contexts.
Agreeable individuals are better liked than disagreeable people, which explains why they should perform well in interpersonally oriented jobs such as customer service.
They experience less work–family conflict and are less likely to turnover. People who are agreeable are more satisfied in their jobs and contribute to organizational performance by engaging in citizenship behavior. They are also less likely to engage in organizational deviance.
One downside is that agreeableness is associated with lower levels of career success.
The five personality factors identified in the Big Five model appear in almost all cross-cultural studies.
These studies have included a wide variety of diverse cultures such as China, Israel, Germany, Japan, Spain, Nigeria, Norway, Pakistan, and the United States. Generally, the findings corroborate what has been found in U.S. research: of the Big Five traits, conscientiousness is the best predictor of job performance.
37

Strengths and Weakness of the MBTI and Big Five Model (5 of 7)
The Dark Triad
Machiavellianism: the degree to which an individual is pragmatic, maintains emotional distance, and believes that ends can justify means.
Narcissism: the tendency to be arrogant, have a grandiose sense of self-importance, require excessive admiration, and have a sense of entitlement.
Psychopathy: the tendency for a lack of concern for others and a lack of guilt or remorse when their actions cause harm.

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The Dark Triad is a group of negative personality traits including Machiavellianism, narcissism, and psychopathy – all three of which have relevance for organizational behavior.
Machiavellianism is the degree to which an individual is pragmatic, maintains emotional distance, and believes that ends can justify means. Narcissism refers to the tendency to be arrogant, have a grandiose sense of self-importance, require excessive admiration, and have a sense of entitlement. And psychopathy is the tendency for a lack of concern for others and a lack of guilt or remorse when their actions cause harm.
38

Strengths and Weakness of the MBTI and Big Five Model (6 of 7)
An emerging framework to study dark side traits:
First, antisocial people are indifferent and callous toward others.
Second, borderline people have low self-esteem and high uncertainty.

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The Dark Triad is a helpful framework for studying the three dominant dark-side traits in current personality research, and researchers are exploring other traits as well.
One emerging framework incorporates five additional aberrant compound traits based on the Big Five.
First, antisocial people are indifferent and callous toward others.
Second, borderline people have low self-esteem and high uncertainty.
39

Strengths and Weakness of the MBTI and Big Five Model (7 of 7)
Third, schizotypal individuals are eccentric and disorganized.
Fourth, obsessive compulsive people are perfectionists and can be stubborn, yet they attend to details, carry a strong work ethic, and may be motivated by achievement.
Fifth, avoidant individuals feel inadequate and hate criticism.

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Third, schizotypal individuals are eccentric and disorganized.
Fourth, obsessive-compulsive people are perfectionists and can be stubborn, yet they attend to details, carry a strong work ethic, and may be motivated by achievement.
Fifth, avoidant individuals feel inadequate and hate criticism.
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CSE, Self-Monitoring, and Proactive Personality
Other Personality Traits Relevant to OB
Core Self-Evaluation: bottom line conclusions individuals have about their capabilities, competence, and worth as a person.
Self-Monitoring: measures an individual’s ability to adjust his or her behavior to external, situational factors.
Proactive Personality: people who identify opportunities, show initiative, take action, and persevere until meaningful change occurs.

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Some other personality traits relevant to OB include core self-evaluation, self-monitoring, and proactive personality.
People who have a positive core self-evaluation see themselves as effective, capable, and in control. People who have a negative core self-evaluation tend to dislike themselves.
Self-monitoring refers to an individual’s ability to adjust his or her behavior to external, situational factors. Individuals high in self-monitoring show considerable adaptability. They are highly sensitive to external cues, can behave differently in different situations, and are capable of presenting striking contradictions between their public persona and their private selves.
An individual with a proactive personality actively takes the initiative to improve his or her current circumstances. These individuals identify opportunities, show initiative, take action, and persevere.
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The Situation, Job Search, and Unemployment
What personality characteristics predict job search behaviors among the unemployed?
Conscientiousness and extraversion are the two strongest predictors of job search behavior,
Self-esteem and self-efficacy (parts of CSE) are also important.

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How does personality influence our job search outcomes and operate during our unemployed periods?
Many studies of unemployed job seekers have found that conscientiousness and extraversion were predictive of networking intensity, general job-search intensity, interviews, and job offers, even after controlling for demographic characteristics and the time spent unemployed.
Overall, one review suggests that conscientiousness and extraversion are the two strongest predictors of job search behavior, although self-esteem and self-efficacy (parts of CSE) are also important.
Additional work on unemployed university students suggests that positive affectivity is also important in getting interviews, job offers, and becoming employed—primarily because the positive affect enables the students to have a clearer and more open perspective toward the job search process, engage in more self-monitoring of their motivation, and through reducing procrastination. Negative affectivity and hostility can have the reverse effect.
It appears that extraversion, conscientiousness, and positive affectivity tend to have a substantial effect on becoming employed and coping with unemployment (with negative affectivity and hostility having equivalent negative effects).
Finally, as we will discuss further in the next section, the situation and context matters as well. The experience of unemployment is not the same for everyone across the board—it can be different for new entrants to the labor market (college grads), those who have just lost their jobs, and those who are employed, seeking jobs.
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The Situation, Personality, and Behavior (1 of 3)
Situation strength theory: indicates that the way personality translates into behavior depends on the strength of the situation.
The degree to which norms, cues, or standards dictate appropriate behavior.
Clarity
Consistency
Constraints
Consequences

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Research shows that the effect of a particular trait on organizational behavior depends on the situation. Two theoretical frameworks that can help explain this are the situation strength theory and trait activation theory.
Situation strength in an organization can be analyzed in terms of:
Clarity, or the degree to which cues about work duties and responsibilities are available and clear.
Consistency, or the extent to which cues regarding work duties and responsibilities are compatible with one another.
Constraints, or the extent to which individuals’ freedom to decide or act is limited by forces outside their control.
Consequences, or the degree to which decisions or actions have important implications for the organization or its members, clients, suppliers, and so on.
43

The Situation, Personality, and Behavior (2 of 3)
Exhibit 4-3 Trait Activation Theory: Jobs in Which Certain Big Five Traits Are More Relevant
Detail Orientation Required Social Skills Required Competitive Work Innovation Required Dealing with Angry People Time Pressure (Deadlines)
Jobs scoring high (the traits listed here should predict behavior in these jobs) blank blank blank blank blank
Air traffic controller Clergy Coach/scout Actor Correctional officer Broadcast news analyst
Accountant Therapist Financial manager Systems analyst Telemarketer Editor
Legal secretary Concierge Sales representative Advertising writer Flight attendant Airline pilot
Jobs scoring low (the traits listed here should not predict behavior in these jobs) blank blank blank blank blank
Forester Software engineer Postal clerk Court reporter Composer Skincare specialist
Masseuse Pump operator Historian Archivist Biologist Mathematician

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Trait activation theory predicts that some situations, events, or interventions “activate” a trait more than others. Exhibit 5-3, shown here, provides specific examples of this theory.
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The Situation, Personality, and Behavior (3 of 3)
[Exhibit 4-3 Continued]
Detail Orientation Required Social Skills Required Competitive Work Innovation Required Dealing with Angry People Time Pressure (Deadlines)
Model Broadcast technician Nuclear reactor operator Medical technician Statistician Fitness trainer
Jobs that score high activate these traits (make them more relevant to predicting behavior) blank blank blank blank blank
Conscientiousness (+) Extraversion (+) Extraversion (+) Openness (+) Extraversion (+) Conscientiousness (+)
Blank Agreeableness (+) Agreeableness (–) Blank Agreeableness (+) Neuroticism (–)
Blank Blank Blank Blank Neuroticism (–) Blank

Contrast Terminal and Instrumental Values (1 of 3)
Values: basic convictions about what is right, good, or desirable.
Value system: ranks values in terms of intensity.
The Importance and Organization of Values
Values:
Lay the foundation for understanding of attitudes and motivation.
Influence attitudes and behaviors.

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Values represent basic convictions that a person has about what is right, good, or desirable. Values have both content and intensity attributes, and have the tendency to be stable and enduring. An individual’s set of values ranked in terms of intensity is considered the person’s value system. Values lay the foundation for our understanding of attitudes and motivation and generally influence attitudes and behaviors.
46

Contrast Terminal and Instrumental Values (2 of 3)
Terminal vs. Instrumental Values
Terminal values: desirable end-states of existence.
Instrumental values: preferred modes of behavior or means of achieving terminal values.

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A specific mode of conduct or end-state of existence is personally or socially preferable to an opposite or converse mode of conduct or end-state of existence. Terminal values refer to desirable end-states of existence. These are the goals that a person would like to achieve during his or her lifetime. Instrumental values refer to preferable modes of behavior, that is, the means of achieving the terminal values.
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Contrast Terminal and Instrumental Values (3 of 3)
Exhibit 4-4 Dominant Work Values in Today’s Workforce
Cohort Entered the Workforce Approximate Current Age Dominant Work Values
Boomers 1965–1985 50s to 70s Success, achievement, ambition, dislike of authority; loyalty to career
Xers 1985–2000 Mid-30s to 50s Work-life balance, team-oriented, dislike of rules; loyalty to relationships
Millennials 2000 to present To mid-30s Confident, financial success, self-reliant but team-oriented; loyalty to both self and relationships

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Exhibit 5-4 shows that different generations hold different work values. Boomers (Baby Boomers) entered the workforce during the 1960s through the mid-1980s. Xers (Generation Xers) entered the workforce beginning in the mid-1980s. The most recent entrants to the workforce are the Millennials. Though it is fascinating to think about generational values, remember that these classifications lack solid research support. Generational classifications may help us understand our own and other generations better, but we must also appreciate their limits.
48

Person-Job Fit vs. Person-Organization Fit (1 of 3)
Exhibit 4-5 Holland’s Typology of Personality and Congruent Occupations
Type Personality Characteristics Congruent Occupations
Realistic: Prefers physical activities that require skill, strength, and coordination Shy, genuine, persistent, stable, conforming, practical Mechanic, drill press operator, assembly-line worker, farmer
Investigative: Prefers activities that involve thinking, organizing, and understanding Analytical, original, curious, independent Biologist, economist, mathematician, news reporter
Social: Prefers activities that involve helping and developing others Sociable, friendly, cooperative, understanding Social worker, teacher, counselor, clinical psychologist
Conventional: Prefers rule-regulated, orderly, and unambiguous activities Conforming, efficient, practical, unimaginative, inflexible Accountant, corporate manager, bank teller, file clerk
Enterprising: Prefers verbal activities in which there are opportunities to influence others and attain power Self-confident, ambitious, energetic, domineering Lawyer, real estate agent, public relations specialist, small business manager
Artistic: Prefers ambiguous and unsystematic activities that allow creative expression Imaginative, disorderly, idealistic, emotional, impractical Painter, musician, writer, interior decorator

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The concept of Person-Job Fit is best articulated in John Holland’s personality-job fit theory as shown in Exhibit 5-5. Holland presents six personality types and proposes that satisfaction and the propensity to leave a job depends on the degree to which individuals successfully match their personalities to an occupational environment. He identifies six personality types: realistic, investigative, social, conventional, enterprising, and artistic.
49

Person-Job Fit vs. Person-Organization Fit (2 of 3)
Person-Organization Fit
People high on extraversion fit well with aggressive and team-oriented cultures.
People high on agreeableness match up better with a supportive organizational climate than one focused on aggressiveness.
People high on openness to experience fit better in organizations that emphasize innovation rather than standardization.

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The Person-Organization Fit is most important for an organization facing a dynamic and changing environment. Such organizations require employees who are able to readily change tasks and move fluidly between teams. It argues that people leave jobs that are not matched with their personalities.
Using the Big Five terminology, for instance, we could expect that people high on extraversion fit well with aggressive and team-oriented cultures, that people high on agreeableness match up better with a supportive organizational climate than one focused on aggressiveness, and that people high on openness to experience fit better in organizations that emphasize innovation rather than standardization. Research on person-organization fit has also looked at whether people’s values match the organization’s culture. This match predicts job satisfaction, commitment to the organization, and low turnover.
50

Person-Job Fit vs. Person-Organization Fit (3 of 3)
Other Dimensions of Fit
Although person-job fit and person-organization fit are considered the most salient dimensions for workplace outcomes, other avenues of fit are worth examining.
Person-group fit
Person-supervisor fit

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Although person-job fit and person-organization fit are considered the most salient dimensions for workplace outcomes, other avenues of fit are worth examining.
These include person-group fit and person-supervisor fit.
Person-group fit is important in team settings, where the dynamics of team interactions significantly affect work outcomes.
Person-supervisor fit has become an important area of research since poor fit in this dimension can lead to lower job satisfaction and reduced performance.
51

Hofstede’s Five Value Dimensions and GLOBE (1 of 2)
Hofstede’s Framework
Power distance
Individualism versus collectivism
Masculinity versus femininity
Uncertainty avoidance
Long-term versus short-term orientation

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Hofstede’s framework for assessing cultures suggests five value dimensions of national culture.
Power distance: is the degree to which people in a country accept that power in institutions and organizations is distributed unequally.
Individualism versus collectivism: individualism is the degree to which people in a country prefer to act as individuals rather than as members of groups. Collectivism emphasizes a tight social framework in which people expect others in groups in which they are a part to look after them and protect them.
Masculinity versus femininity: masculinity is the degree to which values such as the acquisition of money and material goods prevail. Femininity is the degree to which people value relationships and show sensitivity and concern for others.
Uncertainty avoidance: is the degree to which people in a country prefer structured over unstructured situations.
Long-term versus short-term orientation: long-term orientations look to the future and value thrift and persistence. Short-term orientation values the here and now; they accept change more readily and don’t see commitments as impediments to change.
52

Hofstede’s Five Value Dimensions and GLOBE (2 of 2)
The GLOBE Framework for Assessing Culture
The Global Leadership and Organizational Behavior Effectiveness (GLOBE) research program updated Hofstede’s research.
Data from 825 organizations and 62 countries.
Used variables similar to Hofstede’s.
Added some news ones.

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The Global Leadership and Organizational Behavior Effectiveness (GLOBE) program began updating Hofstede’s research using data from 825 organizations and 62 countries. The variables studied are similar to Hofstede’s, with some additional ones as well. For example, performance orientation is the degree to which a society encourages and rewards group members for performance improvement and excellence, and humane orientation is the degree to which a society rewards individuals for being altruistic, generous, and kind to others.
53

Implications for Managers (1 of 2)
Consider screening job candidates for high conscientiousness—and the other Big Five traits—depending on the criteria your organization finds most important. Other aspects, such as core self-evaluation or narcissism, may be relevant in certain situations.
Although the MBTI has faults, you can use it for training and development; to help employees better understand each other, open communication in work groups, and possibly reduce conflicts.

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Personality matters to organizational behavior. It doesn’t explain all behavior, but it sets the stage. Emerging theory and research reveal how personality matters more in some situations than others. The Big Five has been a particularly important advancement, though the Dark Triad and other traits matter as well. Every trait has advantages and disadvantages for work behavior, and there is no perfect constellation of traits that is ideal in every situation. Personality can help you to understand why people (including yourself!) act, think, and feel the way we do, and the astute manager can put that understanding to use by taking care to place employees in situations that best fit their personalities. An understanding of personality can also help you understand what strengths you may have (and should strive for) when searching for a job.
Consider screening job candidates for high conscientiousness—and the other Big Five traits—depending on the criteria your organization finds most important. Other aspects, such as core self-evaluation or narcissism, may be relevant in certain situations.
Although the MBTI has faults, you can use it for training and development; to help employees better understand each other, open communication in work groups, and possibly reduce conflicts.
54

Implications for Managers (2 of 2)
Evaluate jobs, work groups, and your organization to determine the optimal personality fit.
Consider situational factors when evaluating observable personality traits, and lower the situation strength to better ascertain personality characteristics more closely.
The more you consider people’s different cultures, the better you will be able to determine their work behavior and create a positive organizational climate that performs well.

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Evaluate jobs, work groups, and your organization to determine the optimal personality fit.
Consider situational factors when evaluating observable personality traits, and lower the situation strength to better ascertain personality characteristics more closely.
The more you consider people’s different cultures, the better you will be able to determine their work behavior and create a positive organizational climate that performs well.
55

Questions?

Organizational Behavior

Eighteenth Edition, Global Edition

Chapter 5

Perception and Individual Decision Making

Learning Objectives
5.1 Explain the factors that influence perception.
5.2 Describe attribution theory.
5.3 Explain the link between perception and decision making.
5.4 Contrast the rational model of decision making with bounded rationality and intuition.
5.5 Explain how individual differences and organizational constraints affect decision making.
5.6 Contrast the three ethical decision criteria.
5.7 Describe the three-stage model of creativity.

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After studying this chapter, you should be able to:
Explain the factors that influence perception.
Describe attribution theory.
Explain the link between perception and decision making.
Contrast the rational model of decision making with bounded rationality and intuition.
Explain how individual differences and organizational constraints affect decision making.
Contrast the three ethical decision criteria.
Describe the three-stage model of creativity.
2

Explain the Factors That Influence Perception (1 of 2)
Perception is a process by which individuals organize and interpret their sensory impressions to give meaning to their environment.
It is important to the study of OB because people’s behaviors are based on their perception of what reality is, not on reality itself.

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Perception is a process by which individuals organize and interpret their sensory impressions to give meaning to their environment. It is important to the study of OB because people’s behaviors are based on their perception of what reality is, not on reality itself.
3

Explain the Factors That Influence Perception (2 of 2)
Exhibit 5-1 Factors That Influence Perception

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Many factors shape and sometimes distort perception. These factors can reside in the perceiver, the object or target being perceived, or the situation in which the perception is made (see Exhibit 6-1).
4

Explain Attribution Theory (1 of 10)
Attribution theory suggests that when we observe an individual’s behavior, we attempt to determine whether it was internally or externally caused.
Determination depends on three factors:
Distinctiveness
Consensus
Consistency

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Attribution theory suggests that when we observe an individual’s behavior, we attempt to determine whether it was internally or externally caused. That determination depends largely on three factors: distinctiveness, consensus, and consistency. We’ll talk more about each of these in a minute.
5

Explain Attribution Theory (2 of 10)
Clarification of the differences between internal and external causation
Internally caused – those that are believed to be under the personal control of the individual.
Externally caused – resulting from outside causes.

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First, let’s clarify the differences between internal and external causation. Internally caused behaviors are those who are believed to be under the personal control of the individual. Externally caused behavior is seen as resulting from outside causes; that is, the person is seen as having been forced into the behavior by the situation.
6

Explain Attribution Theory (3 of 10)
Exhibit 5-2 Attribution Theory

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Now, let’s look at each of the three determining factors shown here in Exhibit 6-2, more closely. Distinctiveness refers to whether an individual displays different behaviors in different situations. Consensus occurs if everyone who is faced with a similar situation responds in the same way. Finally, is there consistency in a person’s actions.
7

Explain Attribution Theory (4 of 10)
Fundamental attribution error
We have a tendency to underestimate the influence of external factors and overestimate the influence of internal or personal factors.
Self-serving bias
Individuals attribute their own successes to internal factors.

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Errors or biases can distort attributions. Fundamental attribution error occurs when we underestimate the influence of external factors and overestimate the influence of internal or personal factors. Self-serving bias occurs when individuals attribute their own successes to internal factors, such as ability or effort, while putting the blame for failure on external factors, such as luck.
8

Explain Attribution Theory (5 of 10)
Common Shortcuts in Judging Others
Selective perception
Any characteristic that makes a person, object, or event stand out will increase the probability that it will be perceived.
Since we can’t observe everything going on around us, we engage in selective perception.

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We use a number of shortcuts when we judge others, but it’s important to recognize that while these shortcuts can be helpful, they can also result in significant distortions.
Let’s begin with selective perception. Any characteristic that makes a person, object, or event stand out will increase the probability that it will be perceived. Since we can’t observe everything going on around us, we engage in selective perception.
9

Explain Attribution Theory (6 of 10)
Halo effect
The halo effect occurs when we draw a general impression based on a single characteristic.
Contrast effects
We do not evaluate a person in isolation.
Our reaction to one person is influenced by other persons we have recently encountered.

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Another shortcut is the halo effect, which occurs when we draw a general impression on the basis of a single characteristic.
A third shortcut involves contrast effects. We do not evaluate a person in isolation. Our reaction to one person is influenced by other individuals we have recently encountered. For example, an interview situation in which one sees a pool of job applicants can distort perception. Distortions of any given candidate’s evaluation can occur as a result of his or her place in the interview schedule.

Explain Attribution Theory (7 of 10)
Stereotyping
Judging someone based on one’s perception of the group to which that person belongs.
We have to monitor ourselves to make sure we’re not unfairly applying a stereotype in our evaluations and decisions.

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A fourth shortcut is stereotyping, wherein we judge someone based on our perception of the group to which that person belongs. Generalization is not without advantages – it is a means of simplifying a complex world, and it permits us to maintain consistency. The problem, of course, is when we inaccurately stereotype. We have to monitor ourselves to make sure we’re not unfairly applying a stereotype in our evaluations and decisions.
11

Explain Attribution Theory (8 of 10)
Applications of Shortcuts in Organizations
Employment Interview
Evidence indicates that interviewers make perceptual judgments that are often inaccurate.
Interviewers generally draw early impressions that become very quickly entrenched.
Studies indicate that most interviewers’ decisions change very little after the first four or five minutes of the interview.

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Let’s look at some specific applications of shortcuts in organizations.
The first application is the employment interview. Evidence indicates that interviewers make perceptual judgments that are often inaccurate. Moreover, early impressions can become quickly entrenched. In fact, research shows that most interviewers’ decisions change very little after the first few minutes of an interview.
12

Explain Attribution Theory (9 of 10)
Performance Expectations
Evidence demonstrates that people will attempt to validate their perceptions of reality, even when those perceptions are faulty.
Self-fulfilling prophecy, or the Pygmalion effect, characterizes the fact that people’s expectations determine their behavior.
Expectations become reality.

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The second application of shortcuts involves performance expectations. Evidence demonstrates that people will attempt to validate their perceptions of reality, even when those perceptions are faulty. Self-fulfilling prophecy, or the Pygmalion effect, characterizes the fact that people’s expectations determine their behavior. Expectations become reality.
13

Explain Attribution Theory (10 of 10)
Performance Evaluation
An employee’s performance appraisal is very much dependent upon the perceptual process.
Many jobs are evaluated in subjective terms.
Subjective measures are problematic because of selective perception, contrast effects, halo effects, and so on.

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The third application of shortcuts involves performance evaluation. An employee’s performance appraisal is very much dependent upon the perceptual process. Although the appraisal can be objective, many jobs are evaluated in subjective terms. Subjective measures can be problematic because of selective perception, contrast effects, halo effects, and so on.
14

Explain the Link Between Perception and Decision Making
Individuals make decisions – choosing from two or more alternatives.
Decision making occurs as a reaction to a problem.
There is a discrepancy between some current state of affairs and some desired state, requiring consideration of alternative courses of action.
One person’s problem is another’s satisfactory state of affairs.

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Individuals in organizations constantly make decisions. They make choices from among two or more options many times during the day, and at different levels of importance or intensity.
Usually, decision making occurs as a reaction to a problem: there is a discrepancy between some current state of affairs and some desired state, requiring consideration of alternative courses of action. One person’s problem is another’s satisfactory state of affairs.
Every decision requires interpretation and evaluation of information. Data are typically received from multiple sources. The perceptions of the decision maker will decide which data are relevant to the decision and which are not. Alternatives will be developed, and the strengths and weaknesses of each need to be evaluated.
15

Rational Model of Decision Making vs. Bounded Rationality and Intuition (1 of 12)
Exhibit 5-3 Steps in the Rational Decision-Making Model
Define the problem.
Identify the decision criteria.
Allocate weights to the criteria.
Develop the alternatives.
Evaluate the alternatives.
Select the best alternative.

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We often think the best decision maker is rational and makes consistent, value-maximizing choices within specified constraints. This Rational Decision-Making process follows six steps, as shown here in Exhibit 6-3.
Step 1: Define the problem.
Step 2: Identify the decision criteria.
Step 3: Allocate weights to the criteria.
Step 4: Develop the alternatives.
Step 5: Evaluate the alternatives.
Step 6: Select the best alternative.
16

Rational Model of Decision Making vs. Bounded Rationality and Intuition (2 of 12)
Assumptions of the Rational Model
The decision maker…
Has complete information.
Is able to identify all the relevant options in an unbiased manner.
Chooses the option with the highest utility.
Most decisions in the real world don’t follow the rational model.

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The rational decision-making model assumes the decision maker has complete information, is able to identify all the relevant options in an unbiased manner, and chooses the option with the highest utility.
Most decisions in the real world don’t follow the rational model. People are usually content to find an acceptable or reasonable solution to a problem rather than an optimal one. Choices tend to be limited to the neighborhood of the problem symptom and the current alternative. As one expert in decision making put it, “Most significant decisions are made by judgment, rather than by a defined prescriptive model.” People are remarkably unaware of making suboptimal decisions.
17

Rational Model of Decision Making vs. Bounded Rationality and Intuition (3 of 12)
Bounded Rationality
Most people respond to a complex problem by reducing it to a level at which it can be readily understood.
People satisfice – they seek solutions that are satisfactory and sufficient.
Individuals operate within the confines of bounded rationality.
They construct simplified models that extract the essential features.

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When faced with a complex problem, most people respond by reducing the problem to a level at which it can be readily understood. This is because the limited information-processing capability of human beings makes it impossible to assimilate and understand all the information necessary to optimize. Instead, people satisfice; that is, they seek solutions that are satisfactory and sufficient. Individuals operate within the confines of bounded rationality and construct simplified models that extract the essential features.
18

Rational Model of Decision Making vs. Bounded Rationality and Intuition (4 of 12)
How does bounded rationality work?
Once a problem is identified, the search for criteria and options begins.
A limited list of the more conspicuous choices is identified.
The decision maker then reviews the list, looking for a solution that is “good enough.”

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How does bounded rationality work? Once a problem is identified, the search for criteria and options begins. The decision maker will identify a limited list made up of the more conspicuous choices, which are easy to find, tend to be highly visible, and represent familiar criteria and previously tried-and-true solutions. Once this limited set of options is identified, the decision maker will begin reviewing it.
The decision maker will begin with options that differ only in a relatively small degree from the choice currently in effect. The first option that meets the “good enough” criterion ends the search. (Satisficing is not always a bad idea. It is a simple process that may frequently be more sensible than the traditional rational decision-making model.)
To use the rational model in the real world, you need to gather a great deal of information about all the options, compute applicable weights, and then calculate values across a huge number of criteria. All these processes can cost time, energy, and money. If there are many unknown weights and preferences, the fully rational model may not be any more accurate than a best guess. Sometimes a fast-and-frugal process of solving problems is the best option.
19

Rational Model of Decision Making vs. Bounded Rationality and Intuition (5 of 12)
Intuition
Intuitive decision making occurs outside conscious thought; it relies on holistic associations, or links between disparate pieces of information, is fast, and is affectively charged, meaning it usually engages the emotions.
The key is neither to abandon nor rely solely on intuition, but to supplement it with evidence and good judgment.

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Another important decision-making technique is intuition. Perhaps the least rational way of making decisions, intuitive decision making is an unconscious process created from distilled experience. It occurs outside conscious thought, relies on holistic associations, or links between disparate pieces of information, is fast, and is affectively charged, meaning it usually engages the emotions. While intuition isn’t rational, it isn’t necessarily wrong. Nor does it always contradict rational analysis; rather, the two can complement each other. The key is neither to abandon nor rely solely on intuition, but to supplement it with evidence and good judgment.
20

Rational Model of Decision Making vs. Bounded Rationality and Intuition (6 of 12)
Exhibit 5-4 Reducing Biases and Errors
Focus on Goals. Without goals, you can’t be rational, you don’t know what information you need, you don’t know which information is relevant and which is irrelevant, you’ll find it difficult to choose between alternatives, and you’re far more likely to experience regret over the choices you make. Clear goals make decision making easier and help you eliminate options that are inconsistent with your interests.

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Decision makers allow systematic biases and errors to creep into their judgments. People tend to rely on experience, impulses, gut feelings, and rules of thumb, which can all lead to distortions. Exhibit 6-4 suggests some techniques to avoid decision biases or errors beginning with focusing on goals.
21

Rational Model of Decision Making vs. Bounded Rationality and Intuition (7 of 12)
[Exhibit 5-4 Continued]
Look for Information That Disconfirms Your Beliefs. One of the most effective means for counteracting overconfidence and the confirmation and hindsight biases is to actively look for information that contradicts your beliefs and assumptions. When we overtly consider various ways we could be wrong, we challenge our tendencies to think we’re smarter than we actually are.
Don’t Try to Create Meaning out of Random Events. The educated mind has been trained to look for cause-and-effect relationships. When something happens, we ask why. And when we can’t find reasons, we often invent them. You have to accept that there are events in life that are outside your control. Ask yourself if patterns can be meaningfully explained or whether they are merely coincidence. Don’t attempt to create meaning out of coincidence.

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Additional techniques to avoid decision biases or errors include looking for information that disconfirms your beliefs and avoiding trying to create meaning out of random events.
22

Rational Model of Decision Making vs. Bounded Rationality and Intuition (8 of 12)
[Exhibit 5-4 Continued]
Increase Your Options. No matter how many options you’ve identified, your final choice can be no better than the best of the option set you’ve selected. This argues for increasing your decision alternatives and for using creativity in developing a wide range of diverse choices. The more alternatives you can generate, and the more diverse those alternatives, the greater your chance of finding an outstanding one.
Source: Based on S. P. Robbins, Decide & Conquer: Making Winning Decisions and Taking Control of Your Life (Upper Saddle River, NJ: Financial Times/Prentice Hall, 2004), 164–68.

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One more technique to avoid decision biases or errors is to increase your options.
23

Rational Model of Decision Making vs. Bounded Rationality and Intuition (9 of 12)
Common Biases and Errors in Decision Making
Overconfidence Bias: individuals whose intellectual and interpersonal abilities are weakest are most likely to overestimate their performance and ability.
Anchoring Bias: fixating on initial information as a starting point and failing to adequately adjust for subsequent information.

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Decision makers engage in bounded rationality, but they also allow systematic biases and errors to creep into their judgments.
The first is overconfidence bias. Individuals whose intellectual and interpersonal abilities are weakest are most likely to overestimate their performance and ability. The tendency to be too confident about their ideas might keep some from planning how to avoid problems that arise. Investor overconfidence operates in a variety of ways. People think they know more than they do, and it costs them. Investors, especially novices, overestimate not just their own skill in processing information, but also the quality of the information with which they’re working.
A second bias is anchoring bias. This involves fixating on initial information as a starting point and failing to adequately adjust for subsequent information. Anchors are widely used by people in advertising, management, politics, real estate, and law, where persuasion skills are important. Any time a negotiation takes place, so does anchoring.
24

Rational Model of Decision Making vs. Bounded Rationality and Intuition (10 of 12)
Confirmation Bias: type of selective perception.
Seek out information that reaffirms past choices, and discount information that contradicts past judgments.
Availability Bias: tendency for people to base judgments on information that is readily available.

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A third bias is confirmation bias. It is a type of selective perception. Here we seek out information that reaffirms past choices, and discount information that contradicts past judgments.
Fourth is availability bias, or the tendency for people to base judgments on information that is readily available.
25

Rational Model of Decision Making vs. Bounded Rationality and Intuition (11 of 12)
Escalation of Commitment: staying with a decision even when there is clear evidence that it’s wrong.
Likely to occur when individuals view themselves as responsible for the outcome.
Randomness Error: our tendency to believe we can predict the outcome of random events.
Decision making becomes impaired when we try to create meaning out of random events.

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Escalation of commitment is a bias that occurs when we stay with a decision even when there is clear evidence that it’s wrong. This type of bias is most likely to occur when individuals view themselves as responsible for the outcome.
Another bias is randomness error, which is rooted in our tendency to believe we can predict the outcome of random events. Decision making becomes impaired when we try to create meaning out of random events.
26

Rational Model of Decision Making vs. Bounded Rationality and Intuition (12 of 12)
Risk Aversion: the tendency to prefer a sure thing instead of a risky outcome.
Ambitious people with power that can be taken away appear to be especially risk averse.
People will more likely engage in risk-seeking behavior for negative outcomes, and risk-averse behavior for positive outcomes, when under stress.
Hindsight Bias: the tendency to believe falsely that one has accurately predicted the outcome of an event, after that outcome is actually known.

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Another bias, risk aversion, is the tendency to prefer a sure thing instead of a risky outcome. Overall, the framing of a decision has an effect on whether or not people will engage in risk aversive behavior—when decisions are framed positively, such as a potential gain of $50, people will be more risk averse (conversely, when the decision is framed in a negative manner, such as a loss of $50, people will engage in riskier behaviors). Generally speaking, people will more likely engage in risk-seeking behavior for negative outcomes, and risk-averse behavior for positive outcomes, when under stress.
Finally, hindsight bias is the tendency to believe falsely that one has accurately predicted the outcome of an event, after that outcome is actually known. Hindsight bias reduces our ability to learn from the past.
27

Individual Differences, Organizational Constraints, and Decision Making (1 of 2)
Individual Differences
Personality
Conscientiousness
High self-esteem
Gender
Rumination
Mental Ability
Cultural Differences

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Individual differences and organizational constraints also affect decision making.
Personality influences our decisions. Specific facets of conscientiousness—rather than the broad trait itself—may affect escalation of commitment.
Achievement-striving people are more likely to escalate their commitment, whereas dutiful people are less likely to do so. Achievement-oriented people hate to fail, so they escalate their commitment, hoping to forestall failure. Dutiful people, by contrast, are more inclined to do what they see as best for the organization. People with high self-esteem are strongly motivated to maintain it, so they use the self-serving bias to preserve it.
Additional individual characteristics include gender. For example, women, in general, are more likely than men to engage in rumination. Rumination refers to reflecting at length; in decision making, it translates to over-thinking problems. Evidence indicates that women analyze decisions more than men. The rumination tendency appears to be moderated by age. Differences are largest during young adulthood and smallest after age 65.
Next is mental ability. We know people with higher levels of mental ability are able to process information more quickly, solve problems more accurately, and learn faster, so you might expect them also to be less susceptible to common decision errors.
Cultural differences also come into play. The rational model makes no acknowledgment of cultural differences, nor does the bulk of OB research literature on decision making. However, it is important to recognize that the cultural background of a decision maker can significantly influence the selection of problems, the depth of analysis, the importance placed on logic and rationality, and whether organizational decisions should be made autocratically by an individual manager or collectively in groups. Cultures differ in their time orientation, the importance of rationality, their belief in the ability of people to solve problems, and their preference for collective decision making. While rationality is valued in North America, that’s not true elsewhere in the world.
Some cultures emphasize solving problems, while others focus on accepting situations as they are. The United States falls in the first category, while Thailand and Indonesia are examples of the second. Because problem-solving managers believe they can and should change situations to their benefit, U.S. managers might identify a problem long before their Thai or Indonesian counterparts would choose to recognize it. Decision making by Japanese managers is much more group-oriented than in the United States. The Japanese value conformity and cooperation. Before Japanese CEOs make an important decision, they collect a large amount of information, which they use in consensus-forming group decisions. In short, there are probably important cultural differences in decision making, but unfortunately there is not yet much research to identify them.
28

Individual Differences, Organizational Constraints, and Decision Making (2 of 2)
Organizational Constraints
Performance Evaluation Systems
Reward Systems
Formal Regulations
System-Imposed Time Constraints
Historical Precedents

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Organizational constraints that impinge on decision making begin with performance evaluation. Managers are strongly influenced in their decision making by the criteria by which they are evaluated. The organization’s reward system influences decision makers by suggesting to them what choices are preferable in terms of personal payoff.
Other constraints are the formal rules, policies, procedures, and other formalized regulations created by organizations to standardize the behavior of their members. System-imposed time constraints are another influence wherein organizations impose deadlines on decisions.
Finally, historical precedents can serve to impede decision making. Decisions have a context. Individual decisions are more accurately characterized as points in a stream of decisions. Decisions made in the past are ghosts, which continually haunt current choices. For example, it is common knowledge that the largest determining factor of the size of any given year’s budget is last year’s budget.
29

Contrast the Three Ethical Decision Criteria (1 of 3)
Utilitarianism: decisions are made solely on the basis of their outcomes or consequences.
Focus on rights: calls on individuals to make decisions consistent with fundamental liberties and privileges as set forth in documents such as the Bill of Rights.
Protects whistle-blowers.
Impose and enforce rules fairly and impartially to ensure justice or an equitable distribution of benefits and costs.

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Ethical considerations should be an important criterion in organizational decision making. The first is utilitarianism, which occurs when decisions are made solely on the basis of their outcomes or consequences. The focus on rights calls on individuals to make decisions consistent with fundamental liberties and privileges as set forth in documents such as the Bill of Rights; this particular criterion protects whistle-blowers in organizations. The third criterion involves imposing and enforcing rules fairly and impartially to ensure justice or an equitable distribution of benefits and costs. Union members typically favor this view.
Each criterion has advantages and liabilities. A focus on utilitarianism promotes efficiency and productivity, but it can sideline the rights of some individuals, particularly those with minority representation. The focus on rights protects individuals from injury and is consistent with freedom and privacy, but it can create a legalistic environment that hinders productivity and efficiency. A focus on justice protects the interests of the underrepresented and less powerful, but it can encourage a sense of entitlement that reduces risk-taking, innovation, and productivity.
30

Contrast the Three Ethical Decision Criteria (2 of 3)
Behavioral ethics: an area of study that analyzes how people behave when confronted with ethical dilemmas.
Individuals do not always follow ethical standards promulgated by their organizations, and we sometimes violate our own standards.
There are ways to increase ethical decision making in organizations.
Consider cultural differences.

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Increasingly, researchers are turning to behavioral ethics – an area of study that analyzes how people behave when confronted with ethical dilemmas. Their research tells us that while ethical standards exist collectively (e.g., in society and organizations) and individually (e.g., personal ethics), individuals do not always follow ethical standards promulgated by their organizations and we sometimes violate our own standards.
How might we increase ethical decision making in organizations? First, seemingly superficial aspects of the environment—such as lighting, outward displays of wealth and status, and cleanliness—can affect ethical behavior in organizations. Second, managers should encourage conversations about moral issues; they may serve as a reminder and increase ethical decision making. Finally, we should be aware of our own moral “blind spots” — the tendency to see ourselves as more moral than we are, and others as less moral than they are.
Behavioral ethics research stresses the importance of culture in ethical decision-making. What is ethical in one culture may be unethical in another.
Without sensitivity to cultural differences in defining ethical conduct, organizations may encourage unethical conduct without even knowing it.
31

Contrast the Three Ethical Decision Criteria (3 of 3)
Lying
One of the top unethical activities we may indulge in daily.
It undermines all efforts toward sound decision making.
Managers—and organizations—simply cannot make good decisions when facts are misrepresented and people give false motives for their behaviors.
Lying is a big ethical problem as well.

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Lying is one of the top unethical activities we may indulge in daily, and it undermines all efforts toward sound decision making. Lying is deadly to decision making, whether we sense the lies or not. Managers—and organizations—simply cannot make good decisions when facts are misrepresented and people give false motives for their behaviors.
Lying is a big ethical problem as well.
32

Describe the Three-Stage Model of Creativity (1 of 2)
Creativity is the ability to produce novel and useful ideas.
These are ideas that are different from what has been done before, but that are also appropriate to the problem.

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Creativity is the ability to produce novel and useful ideas.
33

Describe the Three-Stage Model of Creativity (2 of 2)
Exhibit 5-5 Three-Stage Model of Creativity in Organizations

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The three-stage model of creativity shown in Exhibit 6-5 suggests that creativity involves causes (creative potential and creative environment), creative behavior, and creative outcomes (innovation).
The first stage, causes of creative behavior, is composed of creative potential and creative environment. Most people have some of the characteristics shared by exceptionally creative people, but the more of these characteristics we have, the higher our creative potential. The potential for creativity is enhanced when individuals have abilities, knowledge, proficiencies, and similar expertise to their field of endeavor.
What environmental factors affect whether creative potential translates into creative behaviors? First and perhaps most important is motivation. If you aren’t motivated to be creative, it is unlikely you will be. It is also valuable to work in an environment that rewards and recognizes creative work. A recent nation-level study suggests that countries scoring high on Hofstede’s culture dimension of individuality are more creative. Good leadership matters to creativity, too. Studies show that diverse teams can be more creative, but only under certain conditions.
Creative behavior occurs in four steps, each of which leads to the next:
Problem formulation: the stage of creative behavior in which we identify a problem or opportunity that requires a solution yet unknown.
Information gathering: the stage of creative behavior when possible solutions to a problem incubate in an individual’s mind.
Idea generation: the process of creative behavior in which we develop possible solutions to a problem from relevant information and knowledge.
Idea evaluation: the process of creative behavior in which we evaluate potential solutions to identify the best one.
Lastly, we can define creative outcomes as ideas or solutions judged to be novel and useful by relevant stakeholders. Novelty itself does not generate a creative outcome if it isn’t useful; thus, “off-the-wall” solutions are creative only if they help solve the problem. Softs skills help translate ideas into results. Another important factor is organizational climate. A study of health care teams found that team creativity translated into innovation only when the climate actively supported innovation.
34

Implications for Managers (1 of 3)
Behavior follows perception, so to influence behavior at work, assess how people perceive their work. Often behaviors we find puzzling can be explained by understanding the initiating perceptions.
Make better decisions by recognizing perceptual biases and decision-making errors we tend to commit. Learning about these problems doesn’t always prevent us from making mistakes, but it does help.

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Individuals base their behavior not on the way their external environment actually is, but rather on the way they see it or believe it to be. An understanding of the way people make decisions can help us explain and predict behavior, but few important decisions are simple or unambiguous enough for the rational model’s assumptions to apply. We find individuals looking for solutions that satisfice rather than optimize, injecting biases and prejudices into the decision process, and relying on intuition.
Managers should encourage creativity in employees and teams to create a route to innovative decision making. Specific implications for managers are:
Behavior follows perception, so to influence behavior at work, assess how people perceive their work. Often behaviors we find puzzling can be explained by understanding the initiating perceptions.
Make better decisions by recognizing perceptual biases and decision-making errors we tend to commit. Learning about these problems doesn’t always prevent us from making mistakes, but it does help.
35

Implications for Managers (2 of 3)
Adjust your decision-making approach to the national culture you’re operating in and to the criteria your organization values. If you’re in a country that doesn’t value rationality, don’t feel compelled to follow the rational decision-making model or to try to make your decisions appear rational. Adjust your decision approach to ensure compatibility with the organizational culture.

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Adjust your decision-making approach to the national culture you’re operating in and to the criteria your organization values. If you’re in a country that doesn’t value rationality, don’t feel compelled to follow the rational decision-making model or to try to make your decisions appear rational. Adjust your decision approach to ensure compatibility with the organizational culture.
36

Implications for Managers (3 of 3)
Combine rational analysis with intuition. These are not conflicting approaches to decision making. By using both, you can improve your decision making effectiveness.
Try to enhance your creativity. Actively look for novel solutions to problems, attempt to see problems in new ways, use analogies, and hire creative talent. Try to remove work and organizational barriers that might impede your creativity.

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Combine rational analysis with intuition. These are not conflicting approaches to decision making. By using both, you can improve your decision-making effectiveness.
Try to enhance your creativity. Actively look for novel solutions to problems, attempt to see problems in new ways, use analogies, and hire creative talent. Try to remove work and organizational barriers that might impede your creativity.
37

Questions?

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Organizational Behavior
Eighteenth Edition, Global Edition
Chapter 6
Emotions and Moods
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Learning Objectives
6.1 Differentiate between emotions and moods.
6.2 Identify the sources of emotions and moods.
6.3 Show the impact emotional labor has on employees.
6.4 Describe affective events theory.
6.5 Describe emotional intelligence.
6.6 Identify strategies for emotion regulation.
6.7 Apply concepts about emotions and moods to specific OB issues.

Copyright © 2019 Pearson Education, Ltd. All Rights Reserved.
After studying this chapter, you should be able to:
Differentiate between emotions and moods.
Identify the sources of emotions and moods.
Show the impact emotional labor has on employees.
Describe affective events theory.
Describe emotional intelligence.
Identify strategies for emotion regulation.
Apply concepts about emotions and moods to specific OB issues.
We will discuss each of these objectives in some detail.
41

Differentiate Between Emotions and Moods (1 of 7)
Exhibit 6-1 Affect, Emotions, and Moods

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Three terms that are closely intertwined: affect, emotion, and moods.
Affect is a generic term that covers a broad range of feelings people experience. This includes both emotions and moods. Emotions are intense feelings that are directed at someone or something. Moods are the feelings that tend to be less intense than emotions and that lack a contextual stimulus.
42

Differentiate Between Emotions and Moods (2 of 7)
Six essentially universal emotions
Anger
Fear
Sadness
Happiness
Disgust
Surprise

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Though not all psychologists agree, there do seem to be six basic emotions that emerge in studies: anger, fear, sadness, happiness, disgust, and surprise. All other emotions fall under these six categories. Sometimes as many as 12 emotions are identified.
43

Differentiate Between Emotions and Moods (3 of 7)
Moral Emotions
Moral emotions: emotions that have moral implications because of our instant judgement of the situation that evokes them.
Our responses to moral emotions differ from our responses to other emotions.
Moral emotions are developed during childhood.
Because morality is a construct that differs between cultures, so do moral emotions.

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Researchers have been studying what are called moral emotions; that is, emotions that have moral implications because of our instant judgement of the situation that evokes them. Interestingly, research indicates that our responses to moral emotions differ from our responses to other emotions.
Moral emotions are developed during childhood as children learn moral norms and standards, so they depend upon the situation and norms more so than other emotions.
Because morality is a construct that differs between cultures, so do moral emotions. Therefore, we need to be aware of the moral aspects of situations that trigger our emotions and make certain we understand the context before we act, especially in the workplace.
44

Differentiate Between Emotions and Moods (4 of 7)
Exhibit 6-2 The Structure of Mood

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Our basic moods carry positive and negative affects. They cannot be neutral. Emotions are grouped into general mood states as shown in Exhibit 4-2. These states impact how employees perceive reality; thereby, the moods can impact the work of employees.
At zero input, most people experience a mildly positive mood. This is referred to as positivity offset.
45

Differentiate Between Emotions and Moods (5 of 7)
OB Poll Emotional States
*Respondents in 148 countries worldwide during 2014 were asked whether they experienced five positive (well-rested, treated with respect, enjoyment, smiling and laughing, learning or doing something interesting) and five negative emotions (anger, stress, sadness, physical pain, worry) daily. Source: Based on J. Clifton, “Latin Americans Lead World in Emotions,” Gallup (August 27, 2015), http://www.gallup.com/poll/184631/latin-americans-leadworld- emotions.aspx.

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As if it weren’t complex enough to consider the many distinct emotions and moods a person might identify, the reality is that we all experience moods and emotions differently.
For most people, positive moods are somewhat more common than negative moods. Indeed, research finds a positivity offset, meaning that at zero input (when nothing in particular is going on), most individuals experience a mildly positive mood.
Does the degree to which people experience positive and negative emotions vary across cultures? Yes (see the OB Poll).
People in most cultures appear to experience certain positive and negative emotions, and people interpret them in much the same way worldwide.
However, an individual’s experience of emotions appears to be culturally shaped.
46

Differentiate Between Emotions and Moods (6 of 7)

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Do emotions make us irrational? There are some who think that emotions are linked to irrationality and that expressing emotions in public may be damaging to your career or status. However, research has shown that emotions are necessary for rational thinking. They help us make better decisions and help us understand the world around us. If we are going to make decisions, we need to incorporate both thinking and feeling.
47

Differentiate Between Emotions and Moods (7 of 7)
Do emotions make us ethical?
Research on moral emotions questions the previous belief that emotional decision making is based on higher-level cognitive processes.
Our beliefs are shaped by our groups, resulting in unconscious responses and a shared moral emotion.
This may allow us to justify purely emotional reactions as rationally ethical just because we share them with others.

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A growing body of research has begun to examine the relationship between emotions and moral attitudes.
Examples of moral emotions include sympathy for the suffering of others, guilt about our own immoral behavior, anger about injustice done to others, contempt for those who behave unethically, and disgust at violations of moral norms. Numerous studies suggest that these reactions are largely based on feelings rather than on cognition.
Our beliefs are shaped by our groups, which influence our perceptions of the ethicality behind certain situations, resulting in unconscious responses and a shared moral emotion.” Unfortunately, these shared emotions may allow us to justify purely emotional reactions as “ethical” just because we share them with others.
We also tend to judge (and punish) outgroup members (anyone who is not in our group) more harshly for moral transgressions than ingroup members, even when we are trying to be objective. In addition, we tend to glorify ingroup members (anyone who is a part of our group) and are more lenient when judging their misdeeds, often leading to a double-standard in ethicality.
48

Identify the Sources of Emotions and Moods (1 of 4)
Personality
Moods and emotions have a trait component.
Affect intensity: how strongly people experience their emotions.
Time of Day
There is a common pattern for all of us.
Happier in the midpoint of the daily awake period.
Day of the Week
Happier toward the end of the week.

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There are many things that impact our mood and emotions. Personality is a key component and will definitely impact the intensity of the emotions we feel. The day and time of the week is a common pattern for all of us as well.
Exhibit 4-3 in your text shows the results of recent research related to time of day. Positive emotions have their greatest effect in mid-morning and then remain stable before rising again until midnight.
In Exhibit 4-4, we can see how the day of the week affects emotions. As the week progresses, positive effects of emotions increases while negative effects decrease. So positive emotions are considerably higher toward the end of the week than they are at the beginning. This tends to be true among many cultures.
49

Identify the Sources of Emotions and Moods (2 of 4)
Weather
Illusory correlation – no effect.
Stress
Even low levels of constant stress can worsen moods.
Social Activities
Physical, informal, and dining activities increase positive moods.

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Weather is thought to have an impact on our emotions, but there is no proven effect.
Stress is an important factor and even at low levels it can cause our mood to change. It is important to maintain a low level of stress to help control psychological and physical health.
Social activities have been shown to have a positive impact on our moods. This could be physical outlets such as playing in a basketball league, or as simple as going out to dinner with friends.
50

Identify the Sources of Emotions and Moods (3 of 4)
Sleep
Poor sleep quality increases negative affect.
Exercise
Does somewhat improve mood, especially for depressed people.

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Some additional sources of emotion and moods include such factors as sleep and exercise. It is important to get enough and high-quality levels of sleep.
Physical activity can also aid in keeping our moods upbeat, particularly for people who are depressed.
51

Identify the Sources of Emotions and Moods (4 of 4)
Age
Older people tend to focus on more positive stimuli than younger adults.
Sex
Women tend to be more emotionally expressive, feel emotions more intensely, have longer-lasting moods, and express emotions more frequently than men.

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Some characteristics that are beyond our control can impact our moods, such as age and sex.
Elderly people tend to have fewer negative emotions.
Older adults tend to focus on more positive stimuli (and on less negative stimuli) than younger adults, a finding confirmed across nearly 100 studies. Furthermore, these older adults tend to self-regulate by actively trying to increase the positivity (and decrease the negativity) in their attention and memory.
Women tend to express their emotions readily and their moods tend to last longer. Research has shown that this is due more to cultural socialization than to biology. People also tend to attribute men’s and women’s emotions in ways that might be based on stereotypes of typical emotional reactions.
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Show the Impact Emotional Labor Has on Employees (1 of 2)
Emotional labor: an employee’s expression of organizationally desired emotions during interpersonal transactions at work.
Types of Emotions
Felt: the individual’s actual emotions.
Displayed: required or appropriate emotions.
Surface acting: hiding feelings and foregoing emotional expressions in response to display rules.
Deep acting: trying to modify true inner feelings based on display rules.

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In many jobs, there is an implied agreement on the types of emotions that should be expressed. For example, waitresses are supposed to be friendly and cheerful, whether they are currently feeling that emotion or not.
An employee’s actual emotions are their felt emotions. The emotions that are required or deemed appropriate by the employer are called displayed emotions. Displaying fake emotions requires suppressing real ones and acting.
Surface acting occurs when an employee displays the appropriate emotions even when he or she don’t feel those emotions. Deep acting occurs when the employee actually changes his or her internal feelings to match display rules; this level of acting can be very stressful.
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Show the Impact Emotional Labor Has on Employees (2 of 2)
Emotional dissonance: Inconsistencies between the emotions people feel and the emotions they project.
Long-term emotional dissonance is a predictor for job burnout, declines in job performance, and lower job satisfaction.

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When employees must project one emotion while feeling another, this disparity is called emotional dissonance.
Bottled-up feelings of frustration, anger, and resentment can lead to emotional exhaustion.
Long-term emotional dissonance is a predictor for job burnout, declines in job performance, and lowers job satisfaction.
However, research from Germany and Australia suggests that employees who have a high capacity for self-control, who get a daily good night’s sleep on a daily basis, and who have strong relationships with their customers or clients tend to be buffered to some degree from the negative side effects of emotional dissonance.
54

Describe Affective Events Theory
Affective events theory (AET): employees react emotionally to things that happen to them at work and this influences job performance and satisfaction.
Emotions provide valuable insights into how workplace events influence employee performance and satisfaction.
Employees and managers shouldn’t ignore emotions or the events that cause them, even when they appear minor, because they accumulate.

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Affective Events Theory, or AET, demonstrates that employees react emotionally to things that happen to them at work, which can influence their job performance and job satisfaction. The intensity of these responses will be based on emotion and mood.
In sum, AET offers two important messages.71 First, emotions provide valuable insights into how workplace events influence employee performance and satisfaction. Second, employees and managers shouldn’t ignore emotions or the events that cause them, even when they appear minor, because they accumulate.
55

Describe Emotional Intelligence (1 of 2)
Emotional Intelligence:
A person’s ability to:
Perceive emotions in the self and others.
Understand the meaning of these emotions.
Regulate one’s emotions accordingly in a cascading model.

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Emotional Intelligence is a person’s ability to be self-aware, which is to recognize his or her own experienced emotions and to understand them. More significantly is the ability to observe and detect emotion in others, and to regulate the emotions in a cascading relationship. People who know their emotions and can read emotional cues are likely to be most effective.
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Describe Emotional Intelligence (2 of 2)
Exhibit 6-5 A Cascading Model of Emotional Intelligence
Source: Based on D. L. Joseph and D. A. Newman, “Emotional Intelligence: An Integrative Meta-Analysis and Cascading Model,” Journal of Applied Psychology 95, no. 1 (2010): 54–78.

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Exhibit 4-5 illustrates the Cascading Model of Emotional Intelligence. Here we see the suggested relationship between Conscientiousness, Cognitive, and Emotional Stability, and the outcomes of detecting one’s own and others’ emotions, understanding what they mean, and regulating the emotions successfully.
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Identify Strategies for Emotion Regulation (1 of 2)
Emotion regulation involves identifying and modifying the emotions you feel.
Emotion Regulation Influences and Outcomes
Diversity in work groups may help us to regulate our emotions more consciously and effectively.

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The process of identifying and modifying emotions you feel is called emotion regulation.
As you might suspect, not everyone is equally good at regulating emotions.
Individuals who are higher in the personality trait of neuroticism have more trouble doing so and often find their moods are beyond their ability to control.
The workplace environment has an effect on an individual’s tendency to employ emotion regulation.
In general, diversity in work groups increases the likelihood that you will regulate your emotions. Racial diversity also has an effect: if diversity is low, the minority will engage in emotion regulation, perhaps to “fit in” with the majority race as much as possible; if diversity is high and many different races are represented, the majority race will employ emotion regulation, perhaps to integrate themselves with the whole group.
These findings suggest a beneficial outcome of diversity—it may cause us to regulate our emotions more consciously and effectively.
It’s important to note that there is a downside to trying to change the way you feel. The effort involved can be exhausting.
From another perspective, research suggests that avoiding negative emotional experiences is less likely to lead to positive moods than does seeking out positive emotional experiences.
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Identify Strategies for Emotion Regulation (2 of 2)
Emotion Regulation Techniques
Surface acting
Deep acting
Emotional suppression
Cognitive reappraisal
Social sharing
Mindfulness
The best option though is to recruit positive-minded individuals and train leaders to manage their moods, attitudes, and performance.

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Researchers of emotion regulation often study the strategies people employ to change their emotions.
One technique of emotion regulation is emotional suppression, or suppressing initial emotional responses to situations. This response seems to facilitate practical thinking in the short term. However, it appears to be helpful only when a strongly negative event would illicit a distressed emotional reaction during a crisis. Thus, unless we’re truly in a crisis, acknowledging rather than suppressing our emotional responses to situations, and re-evaluating events after they occur, yields the best outcomes.
Cognitive reappraisal, or reframing our outlook on an emotional situation, is one way to effectively regulate emotions. This result suggests that cognitive reappraisal may allow people to change their emotional responses, even when the subject matter is highly emotionally charged.
Another technique with potential for emotion regulation is social sharing, or venting. Research shows that the open expression of emotions can help individuals to regulate their emotions, as opposed to keeping emotions “bottled up.” Social sharing can reduce anger reactions when people can talk about the facts of a bad situation, their feelings about the situation, or any positive aspects of the situation.
99A final emotion regulation technique, mindfulness—receptively paying attention to and being aware of the present moment, events, and experiences—has started to become popular in organizations. However, studies on employee mindfulness are new and we have yet to fully realize its causes and outcomes, along with the most effective methods for achieving and sustaining mindful states.
Thus, while there is much promise in emotion regulation techniques, the best route to a positive workplace is to recruit positive-minded individuals and train leaders to manage their moods, job attitudes, and performance. The best leaders manage emotions as much as they do tasks and activities. The best employees can use their knowledge of emotion regulation to decide when to speak up and how to express themselves effectively.
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Apply Concepts About Emotions and Moods to Specific OB Issues (1 of 4)
Selection
EI should be a hiring factor, especially for social jobs.
Decision Making
Positive emotions can lead to better decisions.
Creativity
Positive mood increases flexibility, openness, and creativity.

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Understanding emotions and moods can help us explain and predict selection, decision making, creativity, motivation, leadership, interpersonal conflict, negotiation, customer service, job attitudes, and deviant workplace behaviors. When it comes to selection, EI should be a hiring factor to ensure employee fit. Positive emotions can lead to better decisions and often more creative ones as well.
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Apply Concepts About Emotions and Moods to Specific OB Issues (2 of 4)
Motivation
Positive mood affects expectations of success.
Feedback amplifies this effect.
Leadership
Emotions are important to acceptance of messages from organizational leaders.
Negotiation
Emotions can affect negotiations.

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Positive mood affects expectations of success by all people, which contributes to their motivation for performance. Leadership is affected by mood and emotion, as people in a positive emotional state are found to be more receptive of messages from leaders. Emotions, those both held and displayed, are effective contributors to negotiation, as the potential impact of displayed emotion on negotiation is large. The best negotiators are probably those who remain emotionally detached.
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Apply Concepts About Emotions and Moods to Specific OB Issues (3 of 4)
Customer Service
Emotions influence customer service.
Influences repeat business and customer satisfaction.
Emotional contagion: “catching” emotions.
Work-Life Satisfaction
A good day at work tends to be followed by a good mood at home and vice versa.
This usually dissipates overnight.

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Emotions affect customer service in a number of ways, ranging from the attitude of the employee, to the effectiveness of communication with customers, to overall feelings about the outcome. Research has found that people who are on an emotional high at the end of a day take the positive feelings home with them, and vice versa. This good mood, however, tends to dissipate overnight.
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Apply Concepts About Emotions and Moods to Specific OB Issues (4 of 4)
Deviant Workplace Behaviors
Negative emotions lead to workplace deviant behaviors.
Actions that violate norms and threaten the organization.
Safety and Injury at Work
Don’t do dangerous work when in a bad mood.

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Negative emotions can lead to deviant workplace behaviors. These are actions that violate norms and threaten the organization.
Once aggression starts, it’s likely that other people will become angry and aggressive, so the stage is set for a serious escalation of negative behavior.
Managers, therefore, need to stay connected with their employees to gauge emotions and emotional intensity levels.
In addition, research has found that workers asked to do dangerous work while in negative emotional states are more likely to have accidents. Selecting positive team members can have a contagion effect, as positive moods transmit from team member to team member.
63

Implications for Managers (1 of 2)
Recognize that emotions are a natural part of the workplace and good management does not mean creating an emotion-free environment.
To foster effective decision making, creativity, and motivation in employees, look to model positive emotions and moods as much as is authentically possible.
Provide positive feedback to increase the positivity of employees. Of course, it also helps to hire people who are predisposed to positive moods.

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Finally,
Recognize that emotions are a natural part of the workplace and good management does not mean creating an emotion-free environment.
To foster effective decision making, creativity, and motivation in employees, look to model positive emotions and moods as much as is authentically possible.
Provide positive feedback to increase the positivity of employees. Of course, it also helps to hire people who are predisposed to positive moods.
64

Implications for Managers (2 of 2)
In the service sector, encourage positive displays of emotion, which make customers feel more positive and thus, improve customer service interactions and negotiations.
Understand the role of emotions and moods to significantly improve your ability to explain and predict your coworkers’ and others’ behavior.

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Finally,
In the service sector, encourage positive displays of emotion, which make customers feel more positive and thus, improve customer service interactions and negotiations.
Understand the role of emotions and moods to significantly improve your ability to explain and predict your coworkers’ and others’ behavior.
As one consultant aptly put it, “You can’t divorce emotions from the workplace because you can’t divorce emotions from people.” Managers who understand the role of emotions and moods will significantly improve their ability to explain and predict their coworkers’ and employees’ behavior.
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Questions?

Organizational Behavior

Eighteenth Edition, Global Edition

Chapter 9

Foundations of Group Behavior

Learning Objectives (1 of 2)
9.1 Distinguish between the different types of groups.
9.2 Describe the punctuated-equilibrium model of group development.
9.3 Show how role requirements change in different situations.
9.4 Demonstrate how norms exert influence on an individual’s behavior.

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After studying this chapter, you should be able to:
Distinguish between the different types of groups.
Describe the punctuated-equilibrium model of group development.
Show how role requirements change in different situations.
Demonstrate how norms exert influence on an individual’s behavior.
2

Learning Objectives (2 of 2)
9.5 Show how status and size differences affect group performance.
9.6 Describe how issues of cohesiveness and diversity can be integrated for group effectiveness.
9.7 Contrast the strengths and weaknesses of group decision making.

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Additional objectives for this chapter.
Show how status and size differences affect group performance.
Describe how issues of cohesiveness and diversity can be integrated for group effectiveness.
Contrast the strengths and weaknesses of group decision making.
3

Distinguish Between Different Types of Groups (1 of 5)
A group is defined as two or more individuals, interacting and interdependent, who have come together to achieve particular objectives.
Groups can be either formal or informal.
Formal groups: those defined by the organization’s structure.
Informal groups: alliances that are neither formally structured nor organizationally determined.

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A group is defined as two or more individuals, interacting and interdependent, who have come together to achieve particular objectives. Groups can be either formal or informal.
Formal groups, like an airline flight crew, are those defined by the organization’s structure, with designated work assignments establishing tasks. The behaviors that one should engage in are stipulated by and directed toward organizational goals. In contrast, informal groups are alliances that are neither formally structured nor organizationally determined, but instead are natural formations in the work environment in response to the need for social contact. So, for example, three employees from different departments who regularly eat lunch together is an informal group.
4

Distinguish Between Different Types of Groups (2 of 5)
Social identity theory: considers when and why individuals consider themselves members of groups.
People have emotional reactions to the failure or success of their group because their self-esteem gets tied into the performance of the group.
Social identities help us understand who we are and where we fit in with people.

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Why do people form groups? Our tendency to take personal pride or offense for the accomplishments of a group is the territory of social identity theory.
Social identity theory proposes that people have emotional reactions to the failure or success of their group because their self-esteem gets tied into the performance of the group. Social identities help us understand who we are and where we fit in with other people, but they can have a negative side as well.
5

Distinguish Between Different Types of Groups (3 of 5)
OB Poll Most People Report Drinking with Coworkers is Acceptable
Note: Society for Human Resources Management (SHRM) survey of 501 individuals and how drinking is viewed in their organization at a range of workrelated activities.
Source: Based on S. M. Heathfield, “To Drink or Not to Drink: Does Alcohol Drinking Mix Safely with Work Events?,” About.com Guide, 2013, http://humanresources.about.com/od/networking/qt/drink_i3.htm.

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Until now, we’ve discussed social identities primarily in a cultural context. However, the identity we may feel with respect to our organization is only one aspect of our work-related identities (see OB Poll). Within our organizations and workgroups, we can develop many identities through: (1) relational identification, when we connect with others because of our roles, and (2) collective identification, when we connect with the aggregate characteristics of our groups.
6

Distinguish Between Different Types of Groups (4 of 5)
Ingroups and Outgroups
Ingroup favoritism occurs when we see members of our group as better than other people, and people not in our group as all the same.
Whenever there is an ingroup, there is by necessity an outgroup, which is sometimes everyone else, but is usually an identified group known by the ingroup’s members.

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Probably the biggest downside is that social identities encourage ingroup favoritism, which occurs when we see members of our ingroup as better than other people and people not in our group as all the same. Recent research suggests that people with low openness and/or low agreeableness are more susceptible to ingroup favoritism.
Whenever there is an ingroup, there is by necessity an outgroup, which is sometimes everyone else, but is usually an identified group known by the ingroup’s members. When there are ingroups and outgroups, there is often animosity between them.
One of the most powerful sources of ingroup-outgroup feelings is the practice of religion, even in the workplace. One global study, for instance, found that when groups became heavily steeped in religious rituals and discussions, they became especially discriminatory toward outgroups and aggressive if the outgroups had more resources.
7

Distinguish Between Different Types of Groups (5 of 5)
Social Identity Threat
Ingroups and outgroups pave the way for social identity threat, which is akin to stereotype threat.
Individuals believe they will be personally negatively evaluated due to their association with a devalued group, and they may lose confidence and performance effectiveness.

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Ingroups and outgroups pave the way for social identity threat, which is akin to stereotype. With social identity threat, individuals believe they will be personally negatively evaluated due to their association with a devalued group, and they may lose confidence and performance effectiveness.
8

Describe the Punctuated Equilibrium Model
Exhibit 9-1 The Punctuated-Equilibrium Model

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Temporary groups with deadlines don’t seem to follow the usual five-stage model. Studies indicate they have their own unique sequencing of actions (or inaction). Their first meeting sets the group’s direction. This first phase of group activity is one of inertia. A transition takes place at the end of this phase, which occurs exactly when the group has used up half its allotted time. A transition initiates major changes. A second phase of inertia follows the transition, and the group’s last meeting is characterized by markedly accelerated activity. This pattern, called the punctuated-equilibrium model, is shown in Exhibit 9-1.
The first meeting sets the group’s direction. A framework of behavioral patterns and assumptions emerges. These lasting patterns can appear as early as the first few seconds of the group’s life. Once set, the group’s direction is solidified and is unlikely to be reexamined throughout the first half of its life. This is a period of inertia—the group tends to stand still or become locked into a fixed course of action even if it gains new insights that challenge initial patterns and assumptions.
Then a transition takes place when the group has used up half its allotted time. The midpoint appears to work like an alarm clock, heightening members’ awareness that their time is limited and that they need to “get moving.” A transition initiates major changes. This ends Phase 1 and is characterized by a concentrated burst of changes, dropping of old patterns, and adoption of new perspectives. The transition sets a revised direction for Phase 2. Phase 2 is a new equilibrium or period of inertia. In this phase, the group executes plans created during the transition period. The group’s last meeting is characterized by markedly accelerated activity.
9

Show How Role Requirements Change (1 of 3)
Role: a set of expected behavior patterns attributed to someone occupying a given position in a social unit.
Role perception: one’s perception of how to act in a given situation.
Role expectations: how others believe one should act in a given situation.
Psychological contract

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All group members are actors, each playing a role. We are required to play a number of diverse roles, both on and off our jobs. Many of these roles are compatible; some create conflicts. Different groups impose different role requirements on individuals.
Role perception refers to one’s view of how one is supposed to act in a given situation. We get these perceptions from stimuli all around us—friends, books, movies, and television. The primary reason that apprenticeship programs exist is to allow beginners to watch an “expert,” so that they can learn to act as they are supposed to.
Role expectations refers to how others believe you should act in a given situation. The psychological contract is an unwritten agreement that exists between employees and their employer. It sets out mutual expectations—what management expects from workers, and vice versa. It defines the behavioral expectations that go with every role. If role expectations as implied are not met, expect negative repercussions from the offended party.
10

Show How Role Requirements Change (2 of 3)
Role conflict: situation in which an individual faces divergent role expectations.
We can experience interrole conflict when the expectations of our different, separate groups are in opposition.

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Role conflict: At the extreme, two or more role expectations are mutually contradictory. It exists when compliance with one role requirement may make more difficult the compliance with another.
We can experience interrole conflict when the expectations of our different, separate groups are in opposition. Within organizations, most employees are simultaneously in occupations, workgroups, divisions, and demographic groups, and these identities can conflict when the expectations of one clash with the expectations of another.
During mergers and acquisitions, employees can be torn between their identities as members of their original organization and of the new parent company.
Multinational organizations also have been shown to lead to dual identification—with the local division and with the international organization.
11

Show How Role Requirements Change (3 of 3)
Role Play and Assimilation
Philip Zimbardo’s prison experiment.
Participants easily and rapidly assumed roles that were very different from their inherent personalities.

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One of the most illuminating role and identity experiments was done a number of years ago by Stanford University psychologist Philip Zimbardo and his associates. They created a “prison” in the basement of the Stanford psychology building, hired, at $15 a day, two dozen emotionally stable, physically healthy, law-abiding students who scored “normal average” on extensive personality tests, randomly assigned them the role of either “guard” or “prisoner”, and established some basic rules.
It took little time for the “prisoners” to accept the authority positions of the “guards” and for the mock guards to adjust to their new authority roles. Consistent with social identity theory, the guards came to see the prisoners as a negative out-group, and their comments to researchers showed they had developed stereotypes about the “typical” prisoner personality type. After the guards crushed a rebellion attempt on the second day, the prisoners became increasingly passive. Whatever the guards “dished out,” the prisoners took. The prisoners actually began to believe and act as if they were inferior and powerless, as the guards constantly reminded them. And every guard, at some time during the simulation, engaged in abusive, authoritative behavior. One said, “I was surprised at myself…I made them call each other names and clean the toilets out with their bare hands. I practically considered the prisoners cattle, and I kept thinking: ‘I have to watch out for them in case they try something.’” Surprisingly, during the entire experiment—even after days of abuse—not one prisoner said, “Stop this. I’m a student like you. This is just an experiment!”
The simulation actually proved too successful in demonstrating how quickly individuals learn new roles. The researchers had to end it after only 6 days because of the participants’ pathological reactions. And remember, these were individuals chosen precisely for their normalcy and emotional stability.
What should you conclude from this prison simulation?
The participants had learned stereotyped conceptions of guard and prisoner roles from the mass media and their own personal experiences in power and powerless relationships at home.
This allowed them easily and rapidly to assume roles that were very different from their inherent personalities.
12

Show How Norms Exert Influence On An Individual’s Behavior (1 of 7)
Norms:
Acceptable standards of behavior within a group that are shared by the group’s members.

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All groups have norms, or acceptable standards of behavior that are shared by the group’s members. Norms tell members what they ought and ought not to do under certain circumstances.
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Show How Norms Exert Influence On An Individual’s Behavior (2 of 7)
Norms and Emotions
A recent study found that, in a task group, individuals’ emotions influenced the group’s emotions and vice versa.
Researchers have also found that norms dictated the experience of emotions for the individuals and for the groups – in other words, people grew to interpret their shared emotions in the same way.

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All groups have norms, or acceptable standards of behavior that are shared by the group’s members.
A recent study found that, in a task group, individuals’ emotions influenced the group’s emotions and vice versa.
Researchers have also found that norms dictated the experience of emotions for the individuals and for the groups – in other words, people grew to interpret their shared emotions in the same way.
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Show How Norms Exert Influence On An Individual’s Behavior (3 of 7)
Exhibit 9-2 Examples of Cards Used in Asch’s Study

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There is considerable evidence that groups can place strong pressures on individual members to change their attitudes and behaviors to conform to the group’s standard. The pressure that group exerts for conformity was demonstrated by Solomon Asch.
Groups of seven or eight people were asked to compare two cards held by the experimenter, as shown in Exhibit 9-2. One card had one line; the other had three lines of varying length. Under ordinary conditions, subjects made less than one percent error. The experiment began with several sets of matching exercises. All the subjects gave the right answers. On the third set, however, the first subject gave an obviously wrong answer, the next subject gave the same wrong answer, and so did the others until it got to the unknowing subject.
The results obtained by Asch demonstrated that over many experiments and many trials, subjects conformed in about 37% of the trials; the subjects gave answers that they knew were wrong but that were consistent with the replies of other group members. Has time altered the validity of these findings of nearly 50 years ago, and are they generalizable across cultures? Yes, levels of conformity have steadily declined. Furthermore, Asch’s findings are culture-bound. Conformity to social norms is higher in collectivist cultures than in individualist cultures.
Individuals conform to the important groups to which they belong or hope to belong. However, all groups do not impose equal conformity pressures on their members. Important groups are referred to as reference groups. The reference group is characterized as one where the person is aware of the others; the person defines himself or herself as a member, or would like to be a member; and the person feels that the group members are significant to him/her.
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Show How Norms Exert Influence On An Individual’s Behavior (4 of 7)
Norms and Emotions
A recent study found that, in a task group, individuals’ emotions influenced the group’s emotions and vice versa.
Researchers have also found that norms dictated the experience of emotions for the individuals and for the groups – in other words, people grew to interpret their shared emotions in the same way.

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Norms in the workplace significantly influence employee behavior. Experiments conducted between 1924 and 1932 by Elton Mayo at Western Electric at the company’s Hawthorne Works in Chicago. The Hawthorne researchers began by examining the relationship between the physical environment and productivity. Illumination and other working conditions were selected to represent this physical environment.
The researchers’ initial findings contradicted their anticipated results. As a follow-up, the researchers began a second set of experiments in the relay assembly test room at Western Electric. Observations covering a multiyear period found this small group’s output increased steadily. It became evident this group’s performance was significantly influenced by its status as “special.” In essence, workers in both the illumination and assembly-test-room experiments were reacting to the increased attention they received.
A third study, in the bank wiring observation room, was introduced to ascertain the effect of a sophisticated wage incentive plan. The most important finding of this study was that employees did not individually maximize their outputs. Their output became controlled by a group norm that determined what was a proper day’s work.
Interviews determined the group was operating well below its capability and was leveling output to protect itself.
Members were afraid that if they significantly increased their output, the unit incentive rate would be cut, the expected daily output would be increased, layoffs might occur, or slower workers would be reprimanded.
The norms the group established included a number of “don’ts”:
Don’t be a rate-buster, turning out too much work.
Don’t be a chiseler, turning out too little work.
Don’t squeal on any of your peers.
How did the group enforce these norms?
The methods included sarcasm, name-calling, ridicule, and even punches to the upper arm of any member who violated the group’s norms.
Members also ostracized individuals whose behavior was against the group’s interest.
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Show How Norms Exert Influence On An Individual’s Behavior (5 of 7)
Positive Norms and Group Outcomes
One goal of every organization with corporate social responsibility (CSR) initiatives is for its values to hold normative sway over employees.
If employees aligned their thinking with positive norms, these norms would become stronger and the probability of positive impact would grow exponentially.
Positive group norms may well beget positive outcomes, but only if other factors are present.

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One goal of every organization with corporate social responsibility (CSR) initiatives is for its values to hold normative sway over employees. After all, if employees aligned their thinking with positive norms, these norms would become stronger and the probability of positive impact would grow exponentially.
We might expect the same outcomes from political correctness (PC) norms. But what is the effect of strong positive norms on group outcomes?
The popular thinking is that to increase creativity in groups, for instance, norms should be loosened. However, research on gender-diverse groups indicates that strong PC norms increase group creativity. Positive group norms may well beget positive outcomes, but only if other factors are present, too.
As powerful as norms can be, though, not everyone is equally susceptible to positive group norms. Individual personalities factor in, too, as well as the level of a person’s social identity with the group.
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Show How Norms Exert Influence On An Individual’s Behavior (6 of 7)
Exhibit 9-3 Typology of Deviant Workplace Behavior
Category Examples
Production Leaving early
Blank Intentionally working slowly
Blank Wasting resources
Property Sabotage
Blank Lying about hours worked
Blank Stealing from the organization
Political Showing favoritism
Blank Gossiping and spreading rumors
Blank Blaming coworkers
Personal aggression Sexual harassment
Blank Verbal abuse
Blank Stealing from coworkers

Sources: Based on S. H. Appelbaum, G. D. Iaconi, and A. Matousek, “Positive and Negative Deviant Workplace Behaviors: Causes, Impacts, and Solutions,” Corporate Governance 7, no. 5 (2007): 586–98; and R. W. Griffin and A. O’Leary-Kelly, The Dark Side of Organizational Behavior (New York: Wiley, 2004).

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Deviant workplace behavior—also known as antisocial behavior or workplace incivility—refers to voluntary behavior that violates significant organizational norms and, in doing so, threatens the well-being of the organization or its members. Exhibit 9-3 shows a typology of deviant workplace behaviors.
When deviant workplace behavior occurs, it can affect employee commitment, cooperation, and motivation. This can lead to performance issues and a lack of job satisfaction. Someone who ordinarily wouldn’t engage in deviant behavior might be more likely to do so when working in a group.
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Show How Norms Exert Influence On An Individual’s Behavior (7 of 7)
Norms and Culture
Do people in collectivist cultures have different norms than people in individualist cultures? Of course they do.
But did you know that our orientation may be changed, even after years of living in one society.

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Do people in collectivist cultures have different norms than people in individualist cultures? Of course they do. But did you know that our orientation may be
changed, even after years of living in one society? In a recent experiment, an organizational role-playing exercise was given to a neutral group of subjects; the exercise stressed either collectivist or individualist norms. Subjects were then given a task of their personal choice or were assigned one by an ingroup or outgroup person. When the individualist-primed subjects were allowed personal choice of the task, or the collectivist-primed subjects were assigned the task by an ingroup person, they became more highly motivated.
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Show How Status and Size Differences Affect Performance (1 of 3)
Status: a socially defined position or rank given to groups or group members by others.
Status characteristics theory: status is derived from one of three sources:
The power a person wields over others.
A person’s ability to contribute to a group’s goals.
An individual’s personal characteristics.

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Status is a socially defined position or rank given to groups or group members by others.
Status characteristics theory suggests that differences in status characteristics create status hierarchies within groups. Status is derived from one of three sources. First is the power a person wields over others. Second is a person’s ability to contribute to a group’s goals. And third is an individual’s personal characteristics.
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Show How Status and Size Differences Affect Performance (2 of 3)
Status and Norms: high status individuals often have more freedom to deviate from norms.
Status and Group Interaction: high status people are often more assertive.
Status Inequity: perceived inequity creates disequilibrium and can lead to resentment and corrective behavior.
Status and Stigmatization: stigma by association.
Group Status: “us and them” mentality and ensuing polarization.

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Status and norms can influence behavior in organizations. High-status members of groups often are given more freedom to deviate from norms than other group members. High-status people also are better able to resist conformity pressures. This explains why many star athletes, famous actors, top-performing salespeople, and outstanding academics seem oblivious to appearance or social norms.
Status and group interaction is influenced by status. High-status people tend to be assertive. Status differences can inhibit the diversity of ideas and creativity. Moreover, lower-status members tend to be less active.
When status inequity is perceived, it creates disequilibrium that results in corrective behavior. Hierarchical groups can lead to resentment among those at the lower end of the status continuum. Large differences in status within groups is also associated with poorer individual performance, lower health, and higher intentions to leave the group. Managers who occupy central positions in their social networks are typically seen as higher in status by their subordinates, and this position translates into greater influence over the group’s functioning.
Finally, the status of the people with whom you are affiliated can affect how others view you. Studies have shown that people who are stigmatized against can “infect” others with their stigma. This “stigma by association” effect can result in negative opinions and evaluations of the person affiliated with the stigmatized individual.
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Show How Status and Size Differences Affect Performance (3 of 3)
Group size affects the group’s overall behavior.
Large groups are good for gaining diverse input.
Smaller groups are better doing something with input.
Social loafing: the tendency for individuals to expend less effort when working collectively than alone.

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The size of a group affects the group’s overall behavior, but the effect depends on the dependent variables. Large groups of a dozen or more members are good for gaining diverse input. Smaller groups of about seven members are better at doing something productive with that input.
One of the most important findings about the size of a group concerns social loafing, or the tendency for individuals to expend less effort when working collectively than alone.
22

Integrating Cohesiveness and Diversity for Group Effectiveness (1 of 2)
Exhibit 9-4 Relationship Between Group Cohesiveness, Performance Norms, and Productivity

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Groups differ in their cohesiveness, or the degree to which members are attracted to each other and are motivated to stay in the group. Cohesiveness is important because it’s related to the group’s productivity. As shown here in Exhibit 9-4, the relationship of cohesiveness and productivity depends on the performance-related norms established by the group. If performance-related norms are high, a cohesive group will be more productive. If cohesiveness is high and performance norms are low, productivity will be low.
Encourage group cohesiveness by:
Making the group smaller
Encouraging agreement with group goals
Increasing the time members spend together
Increasing the status of the group and the perceived difficulty of attaining membership in the group
Stimulating competition with other groups
Giving rewards to the group rather than to individual members
Physically isolating the group
23

Integrating Cohesiveness and Diversity for Group Effectiveness (2 of 2)
Diversity: degree to which members of the group are similar to, or different from, one another.
Increases group conflict, especially in the short term.
Culturally and demographically diverse groups may perform better over time.
May help them be more open-minded and creative.
Faultlines

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Diversity in the group’s membership is the degree to which members of the group are similar to, or different from, one another. A great deal of research is being done on how diversity influences group performance. Some studies look at cultural diversity and some at racial, gender, and other differences.
Overall, studies identify both benefits and costs from group diversity. Diversity appears to increase group conflict, especially in the early stages of a group’s tenure, which often lowers group morale and raises dropout rates. Teams in which members’ values or opinions differ tend to experience more conflict, but leaders who can get the group to focus on the task at hand and encourage group learning are able to reduce these conflicts and enhance discussion of group issues.
It seems diversity can be bad for performance even in creative teams, but appropriate organizational support and leadership might offset these problems. If members can weather their differences over time, diversity may help them be more open-minded and creative, and to do better.
One possible side effect in diverse teams—especially those that are diverse in terms of surface-level characteristics—is faultlines, or perceived divisions that split groups into two or more subgroups based on individual differences such as sex, race, age, work experience, and education.
24

Group Decision Making (1 of 8)
Strengths of group decision making:
More complete information and knowledge
Increased diversity of views
Increased acceptance of solutions
Weaknesses of group decision making:
Time consuming
Conformity pressures
Dominance of a few members
Ambiguous responsibility

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Are group decisions better than those made by individuals alone? The strengths of group decision making include: more complete information and knowledge, increased diversity of views, and increased acceptance of a solution. The weaknesses of group decision making include: the fact that it’s more time consuming; there are conformity pressures; one or a few members can dominate group discussion; and responsibility can be ambiguous.
25

Group Decision Making (2 of 8)
Effectiveness and efficiency of group decisions:
Accuracy
Speed
Creativity
Acceptance

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Are groups more effective and efficient at making decisions than individuals? The answer depends on how effectiveness is defined.
Group decisions can be more accurate than the decisions of the average individual in the group, but less accurate than the judgments of the most accurate. Individuals are quicker at making decisions, but groups can be more creative and may be better at accepting the final solution.
In summary, groups offer an excellent vehicle for performing many of the steps in the decision-making process. They are a source of both breadth and depth of input for information gathering. When the final solution is agreed upon, there are more people in a group decision to support and implement it. Group decisions consume time, create internal conflicts, and generate pressures toward conformity.
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Group Decision Making (3 of 8)
Groupthink: situations in which group pressures for conformity deter the group from critically appraising unusual, minority, or unpopular views.
Groupshift: a change between a group’s decision and an individual decision that a member within the group would make.

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Groupthink is related to norms and affects decision making. It describes situations in which group pressures for conformity deter the group from critically appraising unusual, minority, or unpopular views. Groupthink is a disease that attacks many groups and can dramatically hinder performance.
Groupshift, also known as group polarization, describes the way of discussing a given set of alternatives and arriving at a solution whereby group members tend to exaggerate the initial positions they hold. Groups generally shift toward a more extreme version of the group’s original position.
27

Group Decision Making (4 of 8)
Most group decision making takes place in interacting groups.
Members meet face-to-face and rely on both verbal and nonverbal interaction to communicate with each other.
Interacting groups often censor themselves and pressure individual members toward conformity of opinion.

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Most group decision making takes place in interacting groups. In these groups, members meet face-to-face and rely on both verbal and nonverbal interaction to communicate with each other. Interacting groups often censor themselves and pressure individual members toward conformity of opinion.
28

Group Decision Making (5 of 8)
Brainstorming can overcome pressures for conformity.
In a brainstorming session:
The group leader states the problem.
Members then “free-wheel” as many alternatives as they can.
No criticism is allowed.
One idea stimulates others, and group members are encouraged to “think the unusual.”

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Brainstorming and the nominal group technique (discussed in the next slide) can reduce problems inherent in the traditional interacting group. Brainstorming is meant to overcome pressures for conformity in the interacting group that dampens the development of creative alternatives. In a typical brainstorming session, a half dozen to a dozen people sit around a table, the group leader states the problem clearly, and members then “free-wheel” as many alternatives as they can in a given length of time. No criticism is allowed, and all the alternatives are recorded for later discussion and analysis. One idea stimulates others, and group members are encouraged to “think the unusual.”
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Group Decision Making (6 of 8)
The nominal group technique: restricts discussion or interpersonal communication during the decision making process.
Group members are all physically present, but members operate independently.
Permits the group to meet formally but does not restrict independent thinking, as does the interacting group.
Nominal groups outperform brainstorming groups.

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The nominal group technique is different. It restricts discussion or interpersonal communication during the decision-making process. Group members are all physically present, but members operate independently.
The chief advantage of the nominal group technique is that it permits the group to meet formally but does not restrict independent thinking, as does the interacting group.
Research shows that the nominal group is generally more effective than the brainstorming group.
30

Group Decision Making (7 of 8)
Steps for a nominal group:
Each member independently writes down his/her ideas on the problem.
After this silent period, each member presents one idea to the group.
The ideas are discussed for clarity.
Each group member rank-orders the ideas.
The idea with the highest aggregate ranking determines the final decision.

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Here are the steps in the nominal group technique. First, a problem is presented, and then each member independently writes down his or her ideas on the problem. After this silent period, each member presents one idea to the group. Each member takes his or her turn. The group now discusses the ideas for clarity and evaluates them. Each group member silently and independently rank-orders the ideas. The idea with the highest aggregate ranking determines the final decision.
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Group Decision Making (8 of 8)
Exhibit 9-5 Evaluating Group Effectiveness
Blank Blank Type of Group Blank
Effectiveness Criteria Interacting Brainstorming Nominal
Number and quality of ideas Low Moderate High
Social pressure High Low Moderate
Money costs Low Low Low
Speed Moderate Moderate Moderate
Task orientation Low High High
Potential for interpersonal conflict High Low Moderate
Commitment to solution High Not applicable Moderate
Development of group cohesiveness High High Moderate

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Exhibit 9-5 shows that each of the group-decision techniques has its own set of strengths and weaknesses. The choice depends on what criteria you want to emphasize and the cost-benefit trade-off.
32

Implications for Managers (1 of 2)
Recognize that groups can have a dramatic impact on individual behavior in organizations, to either positive or negative effect. Therefore, pay special attention to roles, norms, and cohesion—to understand how these are operating within a group is to understand how the group is likely to behave.
To decrease the possibility of deviant workplace activities, ensure that group norms do not support antisocial behavior.

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We can draw several implications from our discussion of groups. First, norms control behavior by establishing standards of right and wrong. Second, status inequities create frustration and can adversely influence productivity and willingness to remain with an organization. Third, the impact of size on a group’s performance depends on the type of task. Fourth, cohesiveness may influence a group’s level of productivity, depending on the group’s performance-related norms. Fifth, diversity appears to have a mixed impact on group performance, with some studies suggesting that diversity can help performance and others suggesting it can hurt it. Sixth, role conflict is associated with job-induced tension and job dissatisfaction.
Managers should:
Recognize that groups can have a dramatic impact on individual behavior in organizations, to either positive or negative effect. Therefore, pay special attention to roles, norms, and cohesion—to understand how these are operating within a group is to understand how the group is likely to behave.
To decrease the possibility of deviant workplace activities, ensure that group norms do not support antisocial behavior.
33

Implications for Managers (2 of 2)
Pay attention to the status aspect of groups. Because lower-status people tend to participate less in group discussions, groups with high status differences are likely to inhibit input from lower-status members and reduce their potential.
Use larger groups for fact-finding activities and smaller groups for action-taking tasks. With larger groups, provide measures of individual performance.
To increase employee satisfaction, make certain people perceive their job roles accurately.

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In addition:
Pay attention to the status aspect of groups. Because lower-status people tend to participate less in group discussions, groups with high-status differences are likely to inhibit input from lower-status members and reduce their potential.
Use larger groups for fact-finding activities and smaller groups for action-taking tasks. With larger groups, provide measures of individual performance.
To increase employee satisfaction, make certain people perceive their job roles accurately.
34

Questions?

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Organizational Behavior
Eighteenth Edition, Global Edition
Chapter 10
Understanding Work Teams
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Learning Objectives
10.1 Analyze the continued popularity of teams in organizations.
10.2 Contrast groups and teams.
10.3 Contrast the five types of team arrangements.
10.4 Identify the characteristics of effective teams.
10.5 Explain how organizations can create team players.
10.6 Decide when to use individuals instead of teams.

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After studying this chapter, you should be able to:
Analyze the continued popularity of teams in organizations.
Contrast groups and teams.
Contrast the five types of team arrangements.
Identify the characteristics of effective teams.
Explain how organizations can create team players.
Decide when to use individuals instead of teams.
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Analyze the Growing Popularity of Teams in Organizations
Why are teams popular?
Teams can achieve feats an individual could never accomplish.
Teams are flexible and responsive to changing events.
They can quickly assemble, deploy, refocus, and disband.
They are an effective means to democratize organizations and increase employee involvement.
They introduce a collaborative mindset.

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Why are teams popular? In short, because we believe they are effective.
Teams can sometimes achieve feats an individual could never accomplish.
Teams are more flexible and responsive to changing events than traditional departments or other forms of permanent groupings.
They can quickly assemble, deploy, refocus, and disband.
They are an effective means to democratize organizations and increase employee involvement.
And finally, research indicates that our involvement in teams positively shapes the way we think as individuals, introducing a collaborative mindset about even our personal decision making. The fact that organizations have embraced teamwork doesn’t necessarily mean teams are always effective. Team members, as humans, can be swayed by fads and herd mentality that can lead them astray from the best decisions.
40

Differences Between Groups and Teams
Exhibit 10-1 Comparing Workgroups and Work Teams from

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Groups and teams are not the same thing. Exhibit 10-1 shows that a work group interacts primarily to share information and make decisions to help members perform within his or her area of responsibility. In contrast, a work team generates positive synergy through coordinated effort. Individual efforts result in a level of performance that is greater than the sum of those individual inputs.

Contrast the Five Types of Teams
Exhibit 10-2 Four Types of Teams

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Exhibit 10-2 identifies four common types of teams. In addition, we’ll also describe multiteam systems.
First are problem-solving teams. In the past, teams were typically composed of 5–12 hourly employees from the same department who met for a few hours each week to discuss ways of improving quality, efficiency, and the work environment. These problem-solving teams rarely had the authority to implement their suggested actions.
Self-managed teams are groups of employees who perform highly related or interdependent jobs and take on many of the responsibilities of supervisors.
Cross-functional teams are made up of employees from about the same hierarchical level but different work areas, who come together to accomplish a task.
Virtual teams use computer technology to tie together physically dispersed members in order to achieve a common goal.
Finally, multiteam systems are collections of two or more interdependent teams that share a superordinate goal – they are a team of teams.
42

Identify the Characteristics of Effective Teams (1 of 6)
Exhibit 10-3 Team Effectiveness Model

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Exhibit 10-3 summarizes what we know about what makes teams effective. There are a few caveats. First, teams differ in form and structure. The model attempts to generalize across all types of teams, but avoids rigidly applying its predictions to all teams. Second, the model assumes that teamwork is preferable to individual work. Third, consider what team effectiveness means in this model. Typically, team effectiveness includes objective measures of the team’s productivity, managers’ ratings of the team’s performance, and aggregate measures of member satisfaction.
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Identify the Characteristics of Effective Teams (2 of 6)
Team Context: What factors determine whether teams are successful?
Adequate Resources
Leadership and Structure
Climate of Trust
Performance Evaluations and Rewards

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What factors determine whether teams are successful? There are four contextual factors that are most significant to team performance.
First, adequate resources are needed. All work teams rely on resources outside the group to sustain it. A scarcity of resources directly reduces the ability of the team to perform its job effectively.
Second, leadership and structure must be present. Teams can’t function if they can’t agree on who is to do what and ensure all members share the workload. Leadership is especially important in multiteam systems, in which different teams coordinate their efforts to produce a desired outcome.
Third, a climate of trust must be created. Members of effective teams trust each other and exhibit trust in their leaders. When members trust each other, they are more willing to take risks and are more willing to commit to their leader’s goals and decisions.
Finally, a performance evaluation and reward system must be in place. Individual performance evaluations and incentives may not be consistent with the development of high-performance teams. In addition to evaluating and rewarding employees for their individual contributions, management should modify the traditional, individually oriented evaluation and reward system to reflect team performance and focus on hybrid systems that recognize individual members for their exceptional contributions and reward the entire group for positive outcomes. Management should consider group-based appraisals, profit sharing, gainsharing, small-group incentives, and other system modifications that will reinforce team effort and commitment.
44

Identify the Characteristics of Effective Teams (3 of 6)
Team Composition: How should teams be staffed?
Abilities of members
Personality
Allocating roles
Diversity
Organizational demography
Cultural differences
Size of teams
Member preferences

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Factors to consider when staffing a team are the abilities of members, personalities, allocating roles, diversity, team size, and member preferences. Let’s look at each of these, beginning with abilities of members.
Part of a team’s performance depends on the knowledge, skills, and abilities of its individual members. Research reveals that when the task entails considerable thought, such as solving a complex problem like reengineering an assembly line, high-ability teams, composed of mostly intelligent members, do better than lower-ability teams, especially when the workload is distributed evenly. The ability of the team’s leader also matters. Smart team leaders help less-intelligent team members when they struggle with a task. But a less-intelligent leader can neutralize the effect of a high-ability team.
Second is personality of members. Many of the dimensions identified in the Big Five personality model have shown to be relevant to team effectiveness. Teams that rate higher on mean levels of conscientiousness and openness to experience tend to perform better, and the minimum level of team member agreeableness also matters. Teams did worse when they had one or more highly disagreeable members.
Third is allocating roles. Teams have different needs, and people should be selected for a team to ensure that there is diversity and that all various roles are filled. Managers need to understand the individual strengths that each person can bring to a team, select members with their strengths in mind, and allocate work assignments accordingly. Put your most able, experienced, and conscientious workers in the most central roles in a team.
Fourth is the diversity of members. Many of us hold the optimistic view that diversity should be a good thing – diverse teams should benefit from differing perspectives and do better. Diversity in function and expertise are positively related to group performance, but these effects are quite small and depend on the situation. Proper leadership can improve the performance of diverse teams. When leaders provide an inspirational common goal for members with varying types of education and knowledge, teams are very creative. Cultural diversity does seem to be an asset for tasks that call for a variety of viewpoints, but culturally heterogeneous teams have more difficulty learning to work with each other and solving problems. The good news is that these difficulties seem to dissipate with time.
Fifth is cultural differences. We have discussed research on team diversity in race or gender. But what about diversity created by national differences? Like the earlier research, evidence here indicates these elements of diversity interfere with team processes, at least in the short term. Cultural diversity does seem to be an asset for tasks that call for a variety of viewpoints. But culturally heterogeneous teams have more difficulty learning to work with each other and solving problems. The good news is that these difficulties seem to dissipate with time. Although newly formed culturally diverse teams underperform newly formed culturally homogeneous teams, the differences disappear after about 3 months.
When it comes to the size of teams, most experts agree that keeping teams small is a key to improving group effectiveness. In general, the most effective teams have five to nine members. When teams have excess members, cohesiveness and mutual accountability decline, social loafing increases, and more people communicate less.
Finally, we come to the issue of member preferences. Not every employee is a team player. Given the option, many employees will select themselves out of team participation. High performing teams are likely to be composed of people who prefer working as part of a group.
45

Identify the Characteristics of Effective Teams (4 of 6)
Exhibit 10-4 Key Roles of Teams

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Nine roles of potential teams members are shown in Exhibit 10-4 above.
46

Identify the Characteristics of Effective Teams (5 of 6)
Exhibit 10-5 Effects of Group Processes

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The final category related to team effectiveness is process variables, such as member commitment to a common purpose, establishment of specific team goals, team efficacy, team identity, team cohesion, mental models, a managed level of conflict, and minimized social loafing. These will be especially important in larger teams, and in teams that are highly interdependent. Why are processes important to team effectiveness? When each member’s contribution is not clearly visible, individuals tend to decrease their effort – social loafing is a prime example of this.
Exhibit 10-5 illustrates how group processes can have an impact on a group’s actual effectiveness.
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Identify the Characteristics of Effective Teams (6 of 6)
Team Processes
Common Plan and Purpose
Reflexivity
Specific Goals
Team Efficacy
Team Identity
Team Cohesion
Mental Models
Conflict Levels
Social Loafing

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The team process begin with a common plan and purpose. Effective teams begin by analyzing the team’s mission, developing goals to achieve that mission, and creating strategies for achieving the goals. Teams that establish a clear sense of what needs to be done and how consistently perform better. Effective teams show reflexivity, meaning they reflect on and adjust their master plan when necessary.
Second, successful teams translate their common purpose into specific, measurable, and realistic performance goals. Specific goals energize the team, facilitate clear communication, and help teams maintain their focus on results. Team goals should be challenging.
Effective teams have confidence in themselves and believe they can succeed—this is team efficacy. Management can increase team efficacy by helping the team to achieve small successes and skill training. Small successes build team confidence. The greater the abilities of team members, the greater the likelihood that the team will develop confidence and the capability to deliver that confidence.
By recognizing individuals’ specific skills and abilities, as well as creating a climate of respect and inclusion, leaders and members can foster positive team identity and improved team outcomes. The term team cohesion means members are emotionally attached to one another and motivated toward the team because of their attachment.
Effective teams share accurate mental models—organized mental representations of the key elements within a team’s environment that team members share. If team members have the wrong mental models, which is particularly likely with teams under acute stress, their performance suffers. If team members have different ideas about how to do things, the team will fight over how to do things rather than focus on what needs to be done.
Conflict on a team isn’t necessarily bad. Relationship conflicts—those based on interpersonal incompatibilities, tension, and animosity toward others—are almost always dysfunctional. When teams are performing nonroutine activities, disagreements about task content (called task conflicts) stimulate discussion, promote critical assessment of problems and options, and can lead to better team decisions. Both too much and too little disagreement about how a team should initially perform a creative task can inhibit performance.
Finally, social loafing occurs when individuals hide inside a group. Effective teams undermine this tendency by making members individually and jointly accountable for the team’s purpose, goals, and approach. Members should be clear on what they are individually and jointly responsible for.
48

Explain How Organizations Can Create Team Players
Creating Team Players
Selecting: hire team players
Training: create team players
Rewarding: incentives to be a good team player

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Many people are not inherently team players. They are loners or want to be recognized for their own accomplishments. There are also a great many organizations that have historically nurtured individual accomplishments. How do we introduce teams in highly individualistic environments? First, by selecting the right people. Be sure candidates can fulfill their team roles as well as technical requirements.
Second, create team players. Training specialists conduct exercises that allow employees to experience the satisfaction teamwork can provide. Workshops help employees improve their problem-solving, communication, negotiation, conflict-management, and coaching skills. Developing an effective team doesn’t happen overnight—it takes time.
Finally, provide rewards as incentives to be a good team player. An organization’s reward system must be reworked to encourage cooperative efforts rather than competitive ones. Promotions, pay raises, and other forms of recognition should be given to individuals who work effectively as team members by training new colleagues, sharing information, helping resolve team conflicts, and mastering needed new skills. Finally, don’t forget the intrinsic rewards, such as camaraderie, that employees can receive from teamwork. The opportunity for personal development of self and teammates can be a very satisfying and rewarding experience.
49

Decide When to Use Individuals Instead of Teams
When not to use teams…
Ask:
Can the work be done better by one person?
Does the work create a common goal or purpose?
Are the members of the group interdependent?

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Teams are not always the answer to organizational productivity. Teamwork takes more time and often more resources than individual work. Teams have increased communication demands, conflicts to manage, and meetings to run. The benefits of using teams have to exceed the costs, and that’s not always the case. Before you rush to implement teams, carefully assess whether the work requires or will benefit from a collective effort.
How do you know whether the work of your group would be better done in teams? You can apply three tests to see whether a team fits your situation:
Can the work be done better by more than one person? A good indicator is the complexity of the work and the need for different perspectives. Simple tasks that don’t require diverse input are probably better left to individuals.
Does the work create a common purpose or set of goals for the people in the group that is more than the aggregate of individual goals? Many service departments of new-vehicle dealers have introduced teams that link customer-service people, mechanics, parts specialists, and sales representatives. Such teams can better manage collective responsibility for ensuring customer needs are properly met.
Are the members of the group interdependent? Using teams makes sense when there is interdependence between tasks—the success of the whole depends on the success of each one, and the success of each one depends on the success of the others. Soccer, for instance, is an obvious team sport. Success requires a great deal of coordination between interdependent players. Conversely, except possibly for relays, swim teams are not really teams; rather, they are groups of individuals performing individually, whose total performance is the aggregate summation of their individual performances.
50

Implications for Managers (1 of 2)
Effective teams have adequate resources, effective leadership, a climate of trust, and a performance evaluation and reward system that reflects team contributions. These teams have individuals with technical expertise, and the right traits and skills.
Effective teams tend to be small. They have members who fill role demands and who prefer to be part of a group.

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Few trends have influenced jobs as much as the massive movement to introduce teams into the workplace. Working on teams requires employees to cooperate with others, share information, confront differences, and sublimate personal interests for the greater good of the team. Understanding the distinctions between problem solving, self-managed, cross-functional, and virtual teams as well as multiteam systems helps determine the appropriate applications for team-based work. Concepts such as reflexivity, team efficacy, team identity, team cohesion, and mental models bring to light important issues relating to team context, composition, and processes. For teams to function optimally, careful attention must be given to hiring, creating, and rewarding team players. Still, effective organizations recognize that teams are not always the best method for getting the work done efficiently. Careful discernment and an understanding of organizational behavior are needed.
Effective teams have adequate resources, effective leadership, a climate of trust, and a performance evaluation and reward system that reflects team contributions. These teams have individuals with technical expertise, and the right traits and skills.
Effective teams tend to be small. They have members who fill role demands and who prefer to be part of a group.
51

Implications for Managers (2 of 2)
Effective teams have members who believe in the team’s capabilities, are committed to a common plan and purpose, and have an accurate shared mental model of what is to be accomplished.
Select individuals who have the interpersonal skills to be effective team players, provide training to develop teamwork skills, and reward individuals for cooperative efforts.
Do not assume that teams are always needed. When tasks will not benefit from interdependency, individuals may be the better choice.

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Finally,
Effective teams have members who believe in the team’s capabilities, are committed to a common plan and purpose, and have an accurate shared mental model of what is to be accomplished.
Select individuals who have the interpersonal skills to be effective team players, provide training to develop teamwork skills, and reward individuals for cooperative efforts.
Do not assume that teams are always needed. When tasks will not benefit from interdependency, individuals may be the better choice.
52

Questions?

Organizational Behavior

Eighteenth Edition, Global Edition

Chapter 7

Motivation Concepts

Learning Objectives (1 of 2)
7.1 Describe the three key elements of motivation.
7.2 Compare the early theories of motivation.
7.3 Contrast the elements of self-determination theory and goal-setting theory.
7.4 Understand the differences among self-efficacy theory, reinforcement theory, and expectancy theory.

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After studying this chapter, you should be able to:
Describe the three key elements of motivation.
Compare the early theories of motivation.
Contrast the elements of self-determination theory and goal-setting theory.
Understand the differences among self-efficacy theory, reinforcement theory, and expectancy theory.
2

Learning Objectives (2 of 2)
7.5 Describe the forms of organizational justice, including distributive justice, procedural justice, informational justice, and interactional justice.
7.6 Identify the implications of employee job engagement for managers.
7.7 Describe how the contemporary theories of motivation complement one another.

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In addition, after studying this chapter, you should be able to:
Describe the forms of organizational justice, including distributive justice, procedural justice, informational justice, and interactional justice.
Identify the implications of employee job engagement for managers.
Describe how the contemporary theories of motivation complement one another.
3

Describe the Three Key Elements of Motivation (1 of 2)
Motivation is the processes that account for an individual’s intensity, direction, and persistence of effort toward attaining a goal.
The level of motivation varies both between individuals and within individuals at different times.

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Motivation is the processes that account for an individual’s intensity, direction, and persistence of effort toward attaining a goal. We will narrow the focus to organizational goals in order to reflect our singular interest in work-related behavior. Keep in mind that the level of motivation varies both between individuals and within individuals at different times.
4

Describe the Three Key Elements of Motivation (2 of 2)
The three key elements of motivation are:
Intensity: concerned with how hard a person tries.
Direction: the orientation that benefits the organization.
Persistence: a measure of how long a person can maintain his/her effort.

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The three key elements of our definition of motivation are intensity, direction, and persistence. Intensity is concerned with how hard a person tries to do anything. This is the element most of us focus on when we talk about motivation. Direction is the orientation that benefits the organization; it can be positive or negative. Persistence is a measure of how long a person can maintain his or her effort. Motivated individuals stay with a task long enough to achieve their goal.
5

Compare the Early Theories of Motivation (1 of 7)
Exhibit 7-1 Maslow’s Hierarchy of Needs

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Abraham Maslow’s hierarchy of needs is the most well-known theory of motivation. Maslow hypothesized that within every human being there exists a hierarchy of five needs, beginning with physiological needs that include hunger, thirst, shelter, sex, and other bodily needs. The second level is safety needs that include security and protection from physical and emotional harm. The next level is social needs that include affection, belongingness, acceptance, and friendship. Reaching a higher level, we find esteem needs that include internal esteem factors such as self-respect, autonomy, and achievement, and external esteem factors such as status, recognition, and attention. At the top of the hierarchy is self-actualization needs; this is the drive to become what one is capable of becoming, and includes growth, achieving one’s potential, and self-fulfillment.
Maslow separated the five needs into higher and lower orders. As a need becomes substantially satisfied, the next need becomes dominant. No need is ever fully gratified; a substantially satisfied need no longer motivates.
Recently, a sixth need has been proposed for a highest level – intrinsic values—which is said to have originated from Maslow, but it has yet to gain widespread acceptance.
6

Compare the Early Theories of Motivation (2 of 7)
Maslow’s need theory has received wide recognition, particularly among practicing managers.
It is intuitively logical and easy to understand and some research has validated it.
However, most research does not, and it hasn’t been frequently researched since the 1960s.

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Maslow’s need theory has received wide recognition, particularly among practicing managers. It is intuitively logical and easy to understand and some research has validated it. However, most research does not, and it hasn’t been frequently researched since the 1960s.
7

Compare the Early Theories of Motivation (3 of 7)
Exhibit 7-2 Comparison of Satisfiers and Dissatisfiers
Source: Based on Harvard Business Review, “Comparison of Satisfiers and Dissatisfiers,” An exhibit from One More Time: How Do You Motivate Employees? by Frederick Herzberg, January 2003. Copyright © 2003 by the Harvard Business School Publishing Corporation. All rights reserved.

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Proposed by psychologist Frederick Herzberg when he investigated the question, “What do people want from their jobs?” the two-factor theory is sometimes also called motivation-hygiene theory. Herzberg asked people to describe situations in which they felt exceptionally good or bad about their jobs. These responses were then tabulated and categorized.
From the categorized responses, as shown here in Exhibit 7-2, Herzberg concluded that intrinsic factors, such as advancement, recognition, responsibility, and achievement seem to be related to job satisfaction. Dissatisfied respondents tended to cite extrinsic factors, such as supervision, pay, company policies, and working conditions.
Moreover, the opposite of satisfaction is not dissatisfaction. Removing dissatisfying characteristics from a job does not necessarily make the job satisfying. Job satisfaction factors are separate and distinct from job dissatisfaction factors.
8

Compare the Early Theories of Motivation (4 of 7)
Exhibit 7-3 Contrasting View of Satisfaction and Dissatisfaction

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Managers who eliminate job dissatisfaction factors may not necessarily bring about motivation. Exhibit 7-3 reveals that when hygiene factors are adequate, people will not be dissatisfied. Neither will they be satisfied. To motivate people, managers must emphasize intrinsically rewarding factors that are associated with the work itself or to outcomes directly derived from it.
9

Compare the Early Theories of Motivation (5 of 7)
Criticisms of Herzberg’s theory:
Limited because it relies on self-reports.
Reliability of methodology is questioned.
No overall measure of satisfaction was utilized.

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Recent reviews of Herzberg’s research have resulted in many criticisms of the theory. The procedure that Herzberg used is limited by its methodology, therefore, the reliability of Herzberg’s methodology is questioned. For example, no overall measure of satisfaction was utilized.
Regardless of criticisms, Herzberg’s theory has been widely read, and few managers are unfamiliar with his recommendations.
10

Compare the Early Theories of Motivation (6 of 7)
McClelland’s Theory of Needs
The theory focuses on three needs:
Need for achievement (nAch): drive to excel, to achieve in relation to a set of standards, to strive to succeed.
Need for power (nPow): need to make others behave in a way that they would not have behaved otherwise.
Need for affiliation (nAfl): desire for friendly and close interpersonal relationships.

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Another traditional theory is McClelland’s Theory of Needs. This theory focuses on three needs: achievement, power, and affiliation. Let’s look at each one in more detail.
The first of this theory’s variables is achievement need, abbreviated as nAch, which is the drive to excel, to achieve in relation to a set of standards, and to strive to succeed. High achievers perform best when they perceive their probability of success as 50/50. They like to set goals that require stretching themselves a little.
Need for power, the second variable, is the need to make others behave in a way that they would not have behaved otherwise. The need for power, abbreviated as nPow, is the desire to have impact, to be influential, and to control others. Individuals high in nPow enjoy being “in charge.” They strive for influence over others. They prefer to be placed into competitive and status-oriented situations. They also tend to be more concerned with prestige and gaining influence over others than with effective performance.
Finally, the need for affiliation, abbreviated as nAfl, is the desire for friendly and close personal relationships. This need has received the least attention from researchers. In general, individuals with high affiliation strive for friendship and prefer cooperative situations over competitive ones. They typically desire relationships involving a high degree of mutual understanding.
11

Compare the Early Theories of Motivation (7 of 7)
McClelland’s theory has had the best support.
It has less practical effect than the others.
Because McClelland argued that the three needs are subconscious—we may rank high on them but not know it—measuring them is not easy.
It is more common to find situations in which managers aware of these motivational drivers label employees based on observations made over time.

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Among the early theories of motivation, McClelland’s has had the best research support, particularly cross-culturally. Unfortunately, it has less practical effect than the others. McClelland argued that the three needs are subconscious – we may rank high on them, but not know it. Because of this, measuring them is not easy.
It is more common to find situations in which managers aware of these motivational drivers label employees based on observations made over time.
12

Self-Determination Theory vs. Goal-Setting Theory (1 of 9)
Self-Determination Theory
People prefer to feel they have control over their actions.
Focus on the beneficial effects of intrinsic motivation and harmful effects of extrinsic motivation.
Cognitive evaluation theory – When people are paid for work, it feels less like something they want to do and more like something they have to do.
Proposes that in addition to being driven by a need for autonomy, people seek ways to achieve competence and positive connections to others.

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Early theories of motivation have not been supported by research or have fallen out favor. In contrast, contemporary theories have generally been supported, but caution is still in order.
We begin our discussion of contemporary motivation theories with self-determination theory, which proposes that people prefer to feel they have control over their actions, so anything that makes a previously enjoyed task feel more like an obligation than a freely chosen activity will undermine motivation. Much research on self-determination theory in OB has focused on cognitive evaluation theory, which hypothesizes that extrinsic rewards will reduce intrinsic interest in a task. For example, when people are paid for work, it feels less like something they want to do and more like something they have to do. Self-determination theory also proposes that in addition to being driven by a need for autonomy, people seek ways to achieve competence and positive connections to others. However, of all the three needs, the autonomy need is the most important for attitudinal and affective outcomes, whereas the competence need appears to be most important for predicting performance.
13

Self-Determination Theory vs. Goal-Setting Theory (2 of 9)
When extrinsic rewards are used as payoffs for performance, employees feel they are doing a good job.
Eliminating extrinsic rewards can also shift an individual’s perception of why he or she works on a task from an external to an internal explanation.
Self-determination theory acknowledges that extrinsic rewards can improve even intrinsic motivation under specific circumstances.

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When organizations use extrinsic rewards as payoffs for superior performance, employees feel they are doing a good job less because of their own intrinsic desire to excel than because that’s what the organization wants. Eliminating extrinsic rewards can also shift an individual’s perception of why he or she works on a task from an external to an internal explanation. For example, if you’re reading a novel a week because your English literature instructor requires you to, you can attribute your reading behavior to an external source. However, if you find yourself continuing to read a novel each week after the course is over, your natural inclination is to say, “I must enjoy reading novels because I’m still reading one each week.”
Studies examining how extrinsic rewards increased motivation for some creative tasks suggest we might need to place cognitive evaluation theory’s predictions in a broader context. Goal setting is more effective in improving motivation, for instance, when we provide rewards for achieving the goals. The original authors of self-determination theory acknowledge that extrinsic rewards, such as verbal praise and feedback about competence, can improve even intrinsic motivation under specific circumstances. Deadlines and specific work standards do, too, if people believe they are in control of their behavior. This is consistent with the central theme of self-determination theory: rewards and deadlines diminish motivation if people see them as coercive.
14

Self-Determination Theory vs. Goal-Setting Theory (3 of 9)
What does self-determination theory suggest for providing rewards?
Self-concordance: considers how strongly people’s reasons for pursuing goals are consistent with their interests and core values.

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Self-determination theory creates suggestions for providing rewards. For example, if a senior sales representative really enjoys selling and making the deal, a commission indicates he’s been doing a good job and increases his sense of competence by providing feedback that could improve intrinsic motivation. If a computer programmer values writing code because she likes to solve problems, a reward for working toward an externally imposed standard she does not accept, such as writing a certain number of lines of code every day, could feel coercive, and her intrinsic motivation could suffer. She could be less interested in the task and might reduce her effort.
A recent outgrowth of self-determination theory is self-concordance, which considers how strongly peoples’ reasons for pursuing goals are consistent with their interests and core values. If individuals pursue goals because of an intrinsic interest, they are more likely to attain their goals and are happy even if they do not. The process of striving toward them is fun. In contrast, people who pursue goals for extrinsic reasons, like money or status, are less likely to attain their goals and are less happy even when they do because the goals are less meaningful to them. OB research suggests that people who pursue work goals for intrinsic reasons are more satisfied with their jobs, feel they fit into their organizations better, and may perform better.
15

Self-Determination Theory vs. Goal-Setting Theory (4 of 9)
What does all of this mean?
For individuals:
Choose your job for reasons other than extrinsic rewards.
For organizations:
Provide intrinsic as well as extrinsic incentives.

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What does all of this mean? For individuals, it means to choose your job for reasons other than extrinsic rewards. For organizations, it means managers should provide intrinsic as well as extrinsic incentives. They need to make the work interesting, provide recognition, link organizational and employee goals, and support employee growth and development. Employees who feel what they do is within their control and a result of free choice are likely to be more motivated by their work and committed to their employers.
16

Self-Determination Theory vs. Goal-Setting Theory (5 of 9)
Goal-Setting Theory
Goals tell an employee what needs to be done and how much effort is needed.
Evidence suggests:
Specific goals increase performance.
Difficult goals, when accepted, result in higher performance than do easy goals.
Feedback leads to higher performance than does non-feedback.

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Edwin Locke’s goal-setting theory proposed that intentions to work toward a goal are a major source of work motivation. Goals tell an employee what needs to be done and how much effort is needed. Evidence strongly suggests that specific goals increase performance, and that difficult goals, when accepted, result in higher performance than do easy goals. Also, people will do better when they get feedback on how well they are progressing toward their goals. Self-generated feedback is more powerful a motivator than externally generated feedback.
17

Self-Determination Theory vs. Goal-Setting Theory (6 of 9)
Three other factors influencing the goals-performance relationship:
Goal commitment
Task characteristics
National culture

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There are contingencies in goal-setting theory. In addition to goal acceptance, difficulty level, and feedback, three other factors influence the goals-performance relationship: goal commitment, task characteristics, and national culture.
Goal-setting theory presupposes that an individual is committed to the goal, believes it can be achieved, and wants to achieve it. Goal commitment is most likely to occur when the employee expects that their efforts will pay off in goal attainment, when accomplishing the goal is attractive to them, and when they actively participate in goal setting.
Goals themselves seem to affect performance more strongly when task characteristics are: simple rather than complex and independent rather than interdependent. On interdependent tasks, group goals along with delegation of tasks are preferable.
Setting specific, difficult individual goals may have different effects in different cultures. Research has not shown that group-based goals are more effective in collectivists than in individualist cultures. In collectivist and high-power-distance cultures, achievable moderate goals can be more highly motivating than difficult ones. Finally, assigned goals appear to generate greater goal commitment in high than in low-power-distance cultures. More research is needed to assess how goal constructs might differ across cultures.
18

Self-Determination Theory vs. Goal-Setting Theory (7 of 9)
People differ in the way they regulate their thoughts and behaviors.
Those with a promotion focus strive for advancement and accomplishment and approach conditions that move them closer toward desired goals.
Those with a prevention focus strive to fulfill duties and obligations and avoid conditions that pull them away from desired goals.

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Research has also found that people differ in the way they regulate their thoughts and behaviors during goal pursuit. Generally, people fall into one of two categories, though they could belong to both. Those with a promotion focus strive for advancement and accomplishment and approach conditions that move them closer toward desired goals. Those with a prevention focus strive to fulfill duties and obligations and avoid conditions that pull them away from desired goals. Which is the better strategy? Ideally, it’s probably best to be both promotion and prevention oriented.
19

Self-Determination Theory vs. Goal-Setting Theory (8 of 9)
Exhibit 7-4 Cascading of Objectives

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How do you put goal-setting operations into practice? Management by Objectives (MBO) allows employees to participatively set goals that are tangible, verifiable, and measurable. As shown in Exhibit 7-4, an organization’s overall objectives are translated into specific objectives for each succeeding level. Four ingredients common to MBO programs are: goal specificity, participation in decision making, explicit time period, and performance feedback. MBO programs are common in many business, healthcare, educational, government, and nonprofit organizations.
20

Self-Determination Theory vs. Goal-Setting Theory (9 of 9)
Goal Setting and Ethics
The relationship between goal setting and ethics is quite complex: if we emphasize the attainment of goals, what is the cost?
We may forgo mastering tasks and adopt avoidance techniques so we don’t look bad, both of which can incline us toward unethical choices.

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The relationship between goal setting and ethics is quite complex: if we emphasize the attainment of goals, what is the cost? The answer is probably found in the standards we set for goal achievement. If we are put under time pressure and worry about that, thoughts about time turn against us.
Time pressure often increases as we are nearing a goal, which can tempt us to act unethically to achieve it. We may forgo mastering tasks and adopt avoidance techniques so we don’t look bad, both of which can incline us toward unethical choices.
21

Self-Efficacy, Reinforcement, and Expectancy Theory (1 of 8)
Self-efficacy theory is an individual’s belief that he or she is capable of performing a task.
Enactive mastery
Vicarious modeling
Verbal persuasion
Arousal
Also known as social cognitive theory and social learning theory.

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Self-efficacy theory, also known as social cognitive theory and social learning theory, is a new theory gaining much attention. The theory defines four characteristics: enactive mastery, or gaining relevant experience with the task or job; vicarious modeling, or becoming more confident because you see someone else doing the task; verbal persuasion, occurring when a person is more confident because someone convinces him that he has the skills; and arousal, which leads to an energized state, driving a person to complete the task.
22

Self-Efficacy, Reinforcement, and Expectancy Theory (2 of 8)
Exhibit 7-5 Joint Effects of Goals and Self-Efficacy on Performance
Source: Based on E. A. Locke and G. P. Latham, “Building a Practically Useful Theory of Goal Setting and Task Motivation: A 35-Year Odyssey,” American Psychologist (September 2002): 705–17.

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What role does equity play in motivation? Equity theory argues that individuals make comparisons of their job inputs and outcomes relative to those of others and then respond to any inequities. If we perceive our ratio to be equal to that of the relevant others with whom we compare ourselves, a state of equity is said to exist. We perceive our situation as fair. When we see the ratio as unequal, we experience equity tension.
The researcher who developed self-efficacy theory, Albert Bandura, proposes four ways self-efficacy can be increased:
1. Enactive mastery.
2. Vicarious modeling.
3. Verbal persuasion.
4. Arousal.
23

Self-Efficacy, Reinforcement, and Expectancy Theory (3 of 8)
Implications of self-efficacy theory:
The best way for a manager to use verbal persuasion is through the Pygmalion effect.
A form of self-fulfilling prophecy – believing in something can make it true.
Training programs often make use of enactive mastery by having people practice and build their skills.

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What are the implications of self-efficacy theory? First, training programs often make use of enactive mastery by having people practice and build their skills. In fact, one reason training works is that it increases self-efficacy. Second, individuals with higher levels of self-efficacy also appear to reap more benefits from training programs and are more likely to use their training on the job.
The best way for a manager to use verbal persuasion is through the Pygmalion effect. A form of self-fulfilling prophecy – believing in something can make it true.
24

Self-Efficacy, Reinforcement, and Expectancy Theory (4 of 8)
Reinforcement theory: behavior is a function of its consequences.
Reinforcement conditions behavior.
Behavior is environmentally caused.
Goal setting is a cognitive approach: an individual’s purposes direct his or her action.
Operant conditioning theory: people learn to behave to get something they want or to avoid something they don’t want.
B.F. Skinner’s behaviorism.

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Let’s look at reinforcement theory. While goal setting is a cognitive approach proposing that an individual’s purposes direct his or her action, reinforcement theory, by contrast, takes a behavioristic view, arguing that reinforcement conditions behavior. The two theories are clearly at odds, philosophically. Reinforcement theorists see behavior as environmentally caused, ignoring the inner state of the individual and concentrating solely on what happens when he or she takes some action. Because it does not concern itself with what initiates behavior, it is not, strictly speaking, a theory of motivation. But it does provide a powerful means of analyzing what controls behavior, and this is why we typically consider it in discussions of motivation.
Operant conditioning theory argues that people learn to behave to get something they want or to avoid something they don’t want. Unlike reflexive or unlearned behavior, operant behavior is influenced by the reinforcement or lack of reinforcement brought about by its consequences. Reinforcement strengthens a behavior and increases the likelihood it will be repeated. B. F. Skinner, one of the most prominent advocates of operant conditioning, argued that creating pleasing consequences to follow specific forms of behavior would increase the frequency of that behavior – a theory known as behaviorism. He demonstrated that people will most likely engage in desired behaviors if they are positively reinforced for doing so, that rewards are most effective if they immediately follow the desired response, and that behavior that is not rewarded or is punished is less likely to be repeated.
25

Self-Efficacy, Reinforcement, and Expectancy Theory (5 of 8)
Social-learning theory: we can learn through both observation and direct experience.
Models are central, and four processes determine their influence on an individual:
Attentional processes
Retention processes
Motor reproduction processes
Reinforcement processes

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Social-learning theory argues that we can learn through both observation and direct experience. Models are central to the social-learning viewpoint. Four processes determine their influence on an individual:
Attentional processes: people learn from a model only when they recognize and pay attention to its critical features.
Retention processes: a model’s influence depends on how well the individual remembers the model’s action after the model is no longer readily available.
Motor reproduction processes: after a person has seen a new behavior by observing the model, watching must be converted to doing.
Reinforcement processes: individuals are motivated to exhibit the modeled behavior if positive incentives or rewards are provided.
26

Self-Efficacy, Reinforcement, and Expectancy Theory (6 of 8)
Expectancy theory: a tendency to act in a certain way depends on an expectation that the act will be followed by a given outcome and on the attractiveness of that outcome to the individual.
Three relationships:
Effort-performance relationship
Performance-reward relationship
Rewards-personal goals relationship

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Expectancy theory is one of the most widely accepted explanations of motivation. Victor Vroom’s expectancy theory has its critics, but most of the research is supported. Expectancy theory argues that the strength of one’s tendency to act in a certain way depends on the strength of the expectation that the act will be followed by a given outcome and on the attractiveness of that outcome to the individual. It says that an employee will be motivated to exert a high level of effort when he or she believes that effort will lead to a good performance appraisal, that a good appraisal will lead to organizational rewards, and that the rewards will satisfy his or her personal goals.
27

Self-Efficacy, Reinforcement, and Expectancy Theory (7 of 8)
Exhibit 7-6 Expectancy Theory

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Exhibit 7-6 shows the three key relationships:
Expectancy: the effort–performance relationship, which is the probability perceived by the individual that exerting a given amount of effort will lead to performance;
Instrumentality: the performance–reward relationship, which is the degree to which the individual believes that performing at a particular level will lead to the attainment of a desired outcome;
Valence: the rewards–personal goals relationship, which is the degree to which organizational rewards satisfy an individual’s personal goals or needs and the attractiveness of those potential rewards for the individual.
28

Self-Efficacy, Reinforcement, and Expectancy Theory (8 of 8)
Expectancy theory helps explain why a lot of workers aren’t motivated and do only the minimum.
Three questions employees need to answer in the affirmative if their motivation is to be maximized:
If I give maximum effort, will it be recognized in my performance appraisal?
If I get a good performance appraisal, will it lead to organizational rewards?
If I’m rewarded, are the rewards attractive to me?

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Expectancy theory helps explain why a lot of workers aren’t motivated on their jobs and do only the minimum necessary to get by. We can look at the theory’s three relationships by asking three questions that employees would need to answer affirmatively if they are to be motivated: First, if I give maximum effort, will it be recognized in my performance appraisal? Second, if I get a good performance appraisal, will it lead to organizational rewards? Third, if I’m rewarded, are the rewards attractive to me?
29

Forms of Organizational Justice (1 of 5)
Exhibit 7-7 Equity Theory
Ratio Comparisons* Perception
Inequity due to being underrewarded
Equity
Inequity due to being overrewarded

*Where represents the employee and represents relevant others

Forms of Organizational Justice (2 of 5)
When employees perceive an inequity, they can be predicted to make one of six choices:
Change inputs.
Change outcomes.
Distort perceptions of self.
Distort perceptions of others.
Choose a different referent.
Leave the field.

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When employees perceive an inequity, they can be predicted to make one of six choices: they can change inputs, change outcomes, distort perceptions of self, distort perceptions of others, choose a different referent, or they can leave the field.
31

Forms of Organizational Justice (3 of 5)
Exhibit 7-8 Model of Organizational Justice

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Although equity theory’s propositions have not all held up, the hypothesis served as an important precursor to the study of organizational justice, or more simply, fairness, in the workplace. Organizational justice is concerned with how employees feel they are treated by authorities and decision makers at work. For the most part, employees make their evaluations along four dimensions, as shown in Exhibit 7-8.
Distributive justice is concerned with the fairness of the outcomes, such as pay and recognition that employees receive. Although employees care a lot about what outcomes are distributed (distributive justice), they also care a lot about how outcomes are distributed. While distributive justice looks at what outcomes are allocated, procedural justice examines how outcomes are allocated. Having direct influence over how decisions or made, or at the very least being able to present your opinion to decision makers, creates a sense of control and makes us feel empowered. Employees also perceive that procedures are fairer when decision makers follow several “rules.” It turns out that procedural and distributive justice combine to influence people’s perceptions of fairness. If outcomes are favorable and individuals get what they want, they care less about the process, so procedural justice doesn’t matter as much when distributions are perceived to be fair.
Research has shown that employees care about two other types of fairness that have to do with the way they are treated during interactions with others.
The first type is informational justice, which reflects whether managers provide employees with explanations for key decisions and keep them informed of important organizational matters. The second type of justice relevant to interactions between managers and employees is interpersonal justice, which reflects whether employees are treated with dignity and respect.
32

Forms of Organizational Justice (4 of 5)
Justice Outcomes
All the types of justice discussed have been linked to higher levels of task performance and citizenship.
Third-party, or observer, reactions to injustice can be substantial.

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After all this talk about types of justice, how much does justice really matter to employees? A great deal, as it turns out. When employees feel fairly treated, they respond in many positive ways. All the types of justice discussed in this section have been linked to higher levels of task performance and citizenship behaviors such as helping coworkers, as well as lower levels of counterproductive behaviors such as shirking job duties.
Why does justice have these positive effects? Fair treatment enhances commitment to the organization and makes employees feel it cares about their well-being. In addition, employees who feel fairly treated trust their supervisors more, which reduces uncertainty and fear of being exploited by the organization. Finally, fair treatment elicits positive emotions, which in turn prompts behaviors like citizenship.
Your coworker’ reactions to injustice can be just as important as your own. Research is beginning to suggest that third party, or observer, reactions to injustice can have a substantial effect.
33

Forms of Organizational Justice (5 of 5)
Promoting Justice
Adopting strong justice guidelines in an attempt to mandate certain managerial behavior isn’t likely to be universally effective.
Culture and Justice
Inputs and outcomes are valued differently in various cultures.

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How can an organization affect the justice perceptions and rule adherence of its managers? This depends upon the motivation of each manager. Some managers are likely to calculate justice by their degree of adherence to the justice rules of the organization. These managers will try to gain greater subordinate compliance with behavioral expectations, create an identity of being fair to their employees, or establish norms of fairness. Other managers may be motivated in justice decisions by their emotions. When they have a high positive affect and/or a low negative affect, these managers are most likely to act fairly.
It might be tempting for organizations to adopt strong justice guidelines in attempts to mandate managerial behavior, but this isn’t likely to be universally effective. In cases where managers have more rules and less discretion, those who calculate justice are more likely to act fairly, but managers whose justice behavior follows from their affect may act more fairly when they have greater discretion.
Across nations, the same basic principles of procedural justice are respected in that workers around the world prefer rewards based on performance and skills over rewards based on seniority. However, inputs and outcomes are valued differently in various cultures.
34

Implications of Job Engagement for Management (1 of 3)
Job engagement: the investment of an employee’s physical, cognitive, and emotional energies into job performance.
Gallup organization: more engaged employees in successful organizations than in average organizations.
Academic studies: job engagement is positively associated with performance and citizenship behaviors.

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Job engagement is the investment of an employee’s physical, cognitive, and emotional energies into job performance. Practicing managers and scholars alike have lately become interested in facilitating job engagement, believing something deeper than liking a job or finding it interesting drives performance. Many studies attempt to measure this deeper level of commitment.
35

Implications of Job Engagement for Management (2 of 3)
What makes people more engaged in their job?
The degree to which an employee believes it is meaningful to engage in work.
A match between the individual’s values and the organization’s.
Leadership behaviors that inspire workers to a greater sense of mission.

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What makes people more likely to be engaged in their jobs? One key is the degree to which an employee believes it is meaningful to engage in work. This is partially determined by job characteristics and access to sufficient resources to work effectively. Another factor is a match between the individual’s values and those of the organization. In addition, leadership behaviors that inspire workers to a greater sense of mission also increase employee engagement.
36

Implications of Job Engagement for Management (3 of 3)
Are highly engaged employees getting “too much of a good thing?”
Construct is partially redundant with job attitudes.
It may have a “dark side.”
Positive relationships between engagement and work-family conflict.

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One of the critiques of engagement is that the construct is partially redundant with job attitudes such as satisfaction or stress. However, engagement questionnaires usually assess motivation and absorption in a task, quite unlike job satisfaction questionnaires. Engagement may also predict important work outcomes better than traditional job attitudes. Others critics note there may be a “dark side” to engagement, as evidenced by positive relationships between engagement and work–family conflict.
Individuals might grow so engaged in their work roles that family responsibilities become an unwelcomed intrusion. Further research exploring how engagement relates to these negative outcomes may help clarify whether some highly engaged employees might be getting “too much of a good thing.”
37

Compare Contemporary Theories of Motivation
Exhibit 7-9 Integrating Contemporary Theories of Motivation

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Exhibit 7-9 integrates much of what we know about motivation. Its basic foundation is the expectancy model. Expectancy theory predicts that an employee will exert a high level of effort if he or she perceives that there is a strong relationship between effort and performance, performance and rewards, and rewards and satisfaction of personal goals. Each of these relationships, in turn, is influenced by certain factors. For effort to lead to good performance, the individual must have the requisite ability to perform, and the performance appraisal system must be perceived as being fair and objective. The final link in expectancy theory is the rewards–goals relationship.
The model also considers the achievement, need, reinforcement, and equity/organizational justice theories. High achievers are internally driven as long as the jobs they are doing provide them with personal responsibility, feedback, and moderate risks. Reinforcement theory recognizes that the organization’s rewards reinforce the individual’s performance. Individuals will compare the rewards they receive (outcomes) from the inputs they make with the outcome–input ratio of relevant others, and inequities may influence the effort expended.
38

Implications for Managers (1 of 2)
Make sure extrinsic rewards for employees are not viewed as coercive, but instead provide information about competence and relatedness.
Either set or inspire your employees to set specific, difficult goals and provide quality, developmental feedback on their progress toward those goals.
Try to align or tie in employee goals to the goals of your organization.
Model the types of behaviors you would like to see performed by your employees.

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Motivation describes the processes (e.g., intensity, direction, and persistence) underlying how employees and other individuals in the workplace direct their efforts toward a goal. Although not well supported, many foundational early theories of motivation focused on the needs that employees have along with the consequences of need satisfaction. More contemporary theories focused on such topics as intrinsic and extrinsic motivation, setting goals in organizations, self-efficacy, reinforcement, along with our expectations regarding effort, performance, reward, and outcome relationships. Beyond these theories, various forms of organizational justice (e.g., distributive, procedural, and interactional), all deriving from equity theory, are important in motivating employees. Motivation is key to understanding employees’ contributions to their work, including their job engagement. Overall, motivation underlies how and why employees exert effort to engage in performance activities, which in turn meet personal or organizational goals.
Implications for managers:
• Make sure extrinsic rewards for employees are not viewed as coercive, but instead provide information about competence and relatedness.
• Either set or inspire your employees to set specific, difficult goals and provide quality, developmental feedback on their progress toward those goals.
• Try to align or tie in employee goals to the goals of your organization.
39

Implications for Managers (2 of 2)
Expectancy theory offers a powerful explanation of performance variables such as employee productivity, absenteeism, and turnover.
When making decisions regarding resources in your organization, make sure to consider how the resources are being distributed (and who’s impacted), the fairness of the decision, along with whether your actions demonstrate that you respect those involved.

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In addition:
Expectancy theory offers a powerful explanation of performance variables such as employee productivity, absenteeism, and turnover.
When making decisions regarding resources in your organization, make sure to consider how the resources are being distributed (and who’s impacted), the fairness of the decision, along with whether your actions demonstrate that you respect those involved.
40

Questions?

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Organizational Behavior
Eighteenth Edition, Global Edition
Chapter 8
Motivation: From Concepts to Applications
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Learning Objectives
8.1 Describe how the job characteristics model motivates by changing the work environment.
8.2 Compare the main ways jobs can be redesigned.
8.3 Explain how specific alternative work arrangements can motivate employees.
8.4 Describe how employee involvement measures can motivate employees.
8.5 Demonstrate how the different types of variable-pay programs can increase employee motivation.
8.6 Show how flexible benefits turn benefits into motivators.
8.7 Identify the motivational benefits of intrinsic rewards.

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After studying this chapter, you should be able to:
Describe how the job characteristics model motivates by changing the work environment.
Compare the main ways jobs can be redesigned.
Explain how specific alternative work arrangements can motivate employees.
Describe how employee involvement measures can motivate employees.
Demonstrate how the different types of variable-pay programs can increase employee motivation.
Show how flexible benefits turn benefits into motivators.
Identify the motivational benefits of intrinsic rewards.
45

The Job Characteristics Model (1 of 2)
Exhibit 8-1 The Job Characteristics Model
Source: Based on J. L. Pierce, I. Jussila, and A. Cummings, “Psychological Ownership within the Job Design Context: Revision of the Job Characteristics Model,” Journal of Organizational Behavior 30, no. 4 (2009): 477–96.

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The Job Characteristics Model (JCM) as shown here in Exhibit 8-1, proposes that any job may be described by five core job dimensions:
Skill variety is the degree to which the job requires a variety of different activities, so the worker can use a number of different skills and talent.
Task identity is the degree to which the job requires completion of a whole and identifiable piece of work.
Task significance is the degree to which the job has a substantial impact on the lives or work of other people.
Autonomy is the degree to which the job provides substantial freedom, independence, and discretion to the individual in scheduling the work and determining the procedures to be used in carrying it out.
Feedback is the degree to which carrying out the work activities required by the job results in the individual obtaining direct and clear information about the effectiveness of his or her performance.
The first three dimensions—skill variety, task identity, and task significance—combine to create meaningful work the incumbent will view as important, valuable, and worthwhile. From a motivational standpoint, the JCM proposes that individuals obtain internal rewards when they learn (knowledge of results) that they personally (experienced responsibility) have performed well on a task they care about (experienced meaningfulness). Individuals with a high growth need are more likely to experience the critical psychological states when their jobs are enriched—and respond to them more positively—than are their counterparts with low growth need.
46

The Job Characteristics Model (2 of 2)
The core dimensions of the job characteristics model (JCM) can be combined into a single predictive index called the motivating potential score (MPS).
Evidence supports the JCM concept that the presence of a set of job characteristics does generate higher and more satisfying job performance.
Studies show that supportive leadership behaviors improved the job characteristics of R&D professionals.

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The core dimensions of the JCM can be combined into a single predictive index called the motivating potential score (MPS). To be high on motivating potential, jobs must be high on at least one of the three factors that lead to experienced meaningfulness, and high on both autonomy and feedback. If jobs score high on motivating potential, the model predicts that motivation, performance, and satisfaction will improve and absence and turnover will be reduced.
Much evidence supports the JCM concept that the presence of a set of job characteristics—variety, identity, significance, autonomy, and feedback—does generate higher and more satisfying job performance. But apparently we can better calculate motivating potential by simply adding the characteristics rather than using the formula.
Research also shows that supportive leadership behaviors improved the job characteristics of R&D professionals.
47

Compare the Main Ways Jobs Can Be Redesigned (1 of 2)
Repetitive jobs provide little variety, autonomy, or motivation.
Job Rotation
Referred to as cross-training.
Periodic shifting from one task to another.
Strengths: reduces boredom, increases motivation, and helps employees better understand their work contributions.
Weaknesses: creates disruptions, requires extra time for supervisors addressing questions and training time, and reduced efficiencies.

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People generally seek out jobs that are challenging and stimulating, but repetitive jobs provide little variety, autonomy, or motivation. One way to make repetitive jobs more interesting is job rotation, which is also known as cross-training. It involves periodic shifting of an employee from one task to another. When an activity is no longer challenging, the employee is shifted to a different task.
The strengths of job rotation are that it reduces boredom, increases motivation, and helps employees better understand their work contributions. Indirect benefits include employees with wider ranges of skills that give management more flexibility in scheduling, adapting to changes, and filling vacancies. Some weaknesses of job rotation include disruptions, a need for extra time for supervisors addressing questions and training time, and reduced efficiencies.
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Compare the Main Ways Jobs Can Be Redesigned (2 of 2)
Job Enrichment
Increasing a job’s high-level responsibilities to increase intrinsic motivation.
Involves adding another layer of responsibility and meaning.
Can be effective at reducing turnover.
Relational Job Design
To make jobs more prosocially motivating:
Connect employees with the beneficiaries of their work.
Meet beneficiaries firsthand.

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In job enrichment, high-level responsibilities are added to the job to increase a sense of purpose, direction, and meaning and increase intrinsic motivation.
Job enrichment has its roots in Herzberg’s theories of providing hygiene, or motivating factors to the job to increase motivation.
Early reviews suggested that job enrichment can be effective at reducing turnover, almost twice as effective as giving employees a “realistic preview” of the work before they join the organization.
While redesigning jobs on the basis of job characteristics theory is likely to make work more intrinsically motivating to people, more contemporary research is focusing on how to make jobs more prosocially motivating to people. One way to make jobs more prosocially motivating is to better connect employees with the beneficiaries of their work, for example, by relating stories from customers who have found the company’s products or services to be helpful. Beneficiaries of organizations might include customers, clients, patients, and users of products or services. Meeting beneficiaries firsthand allows employees to see that their actions affect a real, live person, and that their jobs have tangible consequences. In addition, connections with beneficiaries make customers or clients more accessible in memory and more emotionally vivid, which leads employees to consider the effects of their actions more. Finally, connections allow employees to easily take the perspective of beneficiaries, which fosters higher levels of commitment.
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How Specific Alternative Work Arrangements Motivate Employees (1 of 7)
Exhibit 8-2 Possible Flextime Staff Schedules
Blank Schedule 1
Percent Time: 100% = 40 hours per week
Core Hours: 9:00 A.M.–5:00 P.M., Monday through Friday
(1 hour lunch)
Work Start Time: Between 8:00 A.M. and 9:00 A.M.
Work End Time: Between 5:00 P.M. and 6:00 P.M.
Blank Schedule 2
Percent Time: 100% = 40 hours per week
Work Hours: 8:00 A.M.–6:30 P.M., Monday through Thursday
(1/2 hour lunch)
Friday off
Work Start Time: 8:00 A.M.
Work End Time: 6:30 P.M.

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Alternative work arrangements are also used to boost motivation. They include flextime, defined as flexible work hours like those shown in Exhibit 8-2. This allows employees some discretion over when they arrive at and leave work. While most of the evidence for flextime stacks up favorably, one review of over 40 studies suggests that flextime is related to positive work outcomes in general, but only weakly—the effects are much stronger when considering reductions in absenteeism, and, to a lesser degree, improvements in productivity and schedule satisfaction. Flextime tends to reduce absenteeism because employees can schedule their work hours to align with personal demands, reducing tardiness and absences, and they can work when they are most productive. A major drawback is that it’s not applicable to all jobs or all workers.
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How Specific Alternative Work Arrangements Motivate Employees (2 of 7)
[Exhibit 8-2 Continued]
Blank Schedule 3
Percent Time: 90% = 36 hours per week
Work Hours: 8:30 A.M.–5:00 P.M., Monday through Thursday
(1/2 hour lunch)
8:00 A.M.–Noon Friday (no lunch)
Work Start Time: 8:30 A.M. (Monday–Thursday); 8:00 A.M. (Friday)
Work End Time: 5:00 P.M. (Monday–Thursday); Noon (Friday)
Blank Schedule 4
Percent Time: 80% = 32 hours per week
Work Hours: 8:00 A.M.–6:00 P.M., Monday through Wednesday
(1/2 hour lunch)
8:00 A.M.–11:30 A.M. Thursday (no lunch)
Friday off
Work Start Time: Between 8:00 A.M. and 9:00 A.M.
Work End Time: Between 5:00 P.M. and 6:00 P.M.

How Specific Alternative Work Arrangements Motivate Employees (3 of 7)
Job Sharing
Two or more people split a 40-hour-a-week job.
Declining in use.
Can be difficult to find compatible pairs of employees who can successfully coordinate the intricacies of one job.
Increases flexibility and can increase motivation and satisfaction when a 40-hour-a-week job is just not practical.

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Job sharing allows two or more individuals to split a traditional 40-hour-a-week job. Only 18 percent of larger organizations now offer job sharing, a 29 percent decrease since 2008. Reasons it is not more widely adopted are likely the difficulty of finding compatible partners to share a job and the historically negative perceptions of individuals not completely committed to their job and employer. The major drawback is finding compatible pairs of employees who can successfully coordinate the intricacies of one job.
However, job sharing allows an organization to draw on the talents of more than one individual in a given job. From the employee’s perspective, job sharing increases flexibility and can increase motivation and satisfaction when a 40-hour-a-week job is just not practical.
52

How Specific Alternative Work Arrangements Motivate Employees (4 of 7)
Telecommuting
Employees who do their work at home at least two days a week through virtual devices linked to the employer’s office.
Some well-known organizations actively discourage telecommuting, but for most organizations it remains popular.

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Telecommuting refers to employees who do their work at home at least two days a week on a computer that is linked to their office.
Large organizations such as Yahoo! And Best Buy have eliminated telecommuting believing it undermines corporate culture, but for it remains popular for many organizations.
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How Specific Alternative Work Arrangements Motivate Employees (5 of 7)
Telecommuting Advantages
Positively related to objective performance and job satisfaction.
Reduced work-family conflict.
Reduced carbon emissions.

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There are reasons for and against telecommuting. Telecommuting is positively related to objective performance and job satisfaction. Moreover, employees who work virtually more than 2.5 days a week tended to experience the benefits of reductions in work-family conflict more intensely than those who are in the office the majority of their work week.42 Beyond the benefits to organizations and their employees, telecommuting has potential benefits to society. One study estimated that if people in the United States telecommuted half the time, carbon emissions would be reduced by approximately 51 metric tons per year.
54

How Specific Alternative Work Arrangements Motivate Employees (6 of 7)
Telecommuting Disadvantages
Employer
Social loafing.
Difficult to coordinate teamwork.
Difficult to evaluate non-quantitative performance.
Employee
Increased feelings of isolation and reduced coworker relationship quality.
May not be noticed for his or her efforts.

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Disadvantages of telecommuting for the employer include potential for social loafing, difficulty coordinating teamwork, and difficulty evaluating non-quantitative performance. Disadvantages for the employee include that he or she may not be as noticed for his or her efforts, increased feelings of isolation, and poorer coworker relationship quality.
55

How Specific Alternative Work Arrangements Motivate Employees (7 of 7)
OB Poll Who Works from Home
Source: Bureau of Labor Statistics, Table 6, from Economic News Release, “American Time Use Survey Summary,” June 24, 2016, https://www.bls.gov/news.release/atus.t06.htm.

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Telecommuting seems to mesh with the cultural transition to knowledge work.
As the OB poll indicates, people with more education are more apt to work from home.
56

Employee Involvement and Employee Motivation (1 of 3)
Employee Involvement: a participative process that uses employees’ input to increase their commitment to the organization’s success.
Examples of Employee Involvement Programs
Participative management
Representative participation

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Employee involvement refers to a participative process that uses employees’ input to increase their commitment to the organization’s success. Two examples of such programs are participative management and representative participation.
57

Employee Involvement and Employee Motivation (2 of 3)
Participative management
Joint decision making.
Acts as a panacea for poor morale and low productivity.
Trust and confidence in leaders is essential.
Studies of the participation-performance have yielded mixed results.

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Participative management is the first of the options for employee involvement programs. Common to all participative management programs is joint decision making, wherein subordinates share a significant degree of decision making power with their immediate superiors. Participative management has, at times, been promoted as a panacea for poor morale and low productivity. But for it to work, employees must be engaged in issues relevant to their interests so they’ll be motivated, they must have the competence and knowledge to make a useful contribution, and trust and confidence must exist among all parties.
Studies of the participation–organizational performance relationship have yielded mixed findings. Organizations that institute participative management do have higher stock returns, lower turnover rates, and higher estimated labor productivity, although these effects are typically not large.
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Employee Involvement and Employee Motivation (3 of 3)
Representative participation
Workers are represented by a small group of employees who actually participate in decision making.
Almost every country in Western Europe requires representative participation.
The two most common forms:
Works councils
Board representatives

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Representative participation is spreading. Almost every country in Western Europe has some type of legislation requiring it. It is the most widely legislated form of employee involvement around the world. The goal is to redistribute power within an organization, putting labor on a more equal footing with the interests of management and stockholders.
The two most common forms include works councils that link employees with management. They are groups of nominated or elected employees who must be consulted when management makes decisions involving personnel. Second is board representatives, who are employees who sit on a company’s board of directors and represent the interests of the firm’s employees. The overall influence of representative participation seems to be minimal. The evidence suggests that works councils are dominated by management and have little impact on employees or the organization. If one were interested in changing employee attitudes or in improving organizational performance, representative participation would be a poor choice.
59

Variable-Pay Programs and Employee Motivation (1 of 8)
What to Pay:
Complex process that entails balancing internal equity and external equity.
Some organizations prefer to pay leaders by paying above market.
Paying more may net better-qualified and more highly motivated employees who may stay with the firm longer.

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Now, let’s talk about using rewards to motivate people, and specifically, what to pay employees. As we saw in Chapter 3, pay is not a primary factor driving job satisfaction. However, it does motivate people, and companies often underestimate its importance in keeping top talent.
So, what should an organization do? How should the pay structure be established? The answer is not easy – it’s a complex process that entails balancing internal equity and external equity. Some organizations prefer to pay leaders by paying above market. Keep in mind that paying more may net better-qualified and more highly motivated employees who may stay with the firm longer.
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Variable-Pay Programs and Employee Motivation (2 of 8)
How to Pay:
Variable pay programs:
Piece-rate plans
Merit-based pay
Bonuses
Profit sharing
Employee stock ownership plans
Earnings therefore fluctuate up and down.

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Rewarding individual employees through variable-pay programs is becoming more common in the workplace. A number of organizations are moving away from paying solely on credentials or length of service. Piece-rate plans, merit-based pay, bonuses, profit sharing, and employee stock ownership plans are all forms of a variable-pay program, which base a portion of an employee’s pay on some individual and/or organizational measure of performance. Individual earnings therefore fluctuate up and down.
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Variable-Pay Programs and Employee Motivation (3 of 8)
Piece-Rate Pay
A pure piece-rate plan provides no base salary and pays the employee only for what he or she produces.
Limitation: not a feasible approach for many jobs.
The main concern for both individual and team piece-rate workers is financial risk.

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The first of the variable pay programs is piece-rate pay plans. Here, workers are paid a fixed sum for each unit of production completed. A pure piece-rate plan provides no base salary and pays the employee only for what he or she produces. The main concern for both individual and team piece-rate workers is financial risk.
The main limitation of the piece rate plan is that it doesn’t work for all types of jobs. Although incentives are motivating and relevant for some jobs, it is unrealistic to think they can constitute the only piece of some employees’ pay.
62

Variable-Pay Programs and Employee Motivation (4 of 8)
Merit-Based Pay
Allows employers to differentiate pay based on performance.
Creates perceptions of relationships between performance and rewards.
Limitations:
Based on annual performance appraisals.
Merit pool fluctuates.
Union resistance.

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The second variable pay method is the merit-based pay plan. These plans are based on performance appraisal ratings. Their main advantage is that they allow employers to differentiate pay based on performance, and so create perceptions of relationships between performance and rewards. Most large organizations have merit pay plans, particularly for salaried employees. Limitations to merit-based plans include that they are based on annual performance appraisals, that the merit pool fluctuates based on economic conditions, and that unions typically resist merit-based pay plans.
63

Variable-Pay Programs and Employee Motivation (5 of 8)
Bonuses
An annual bonus is a significant component of total compensation for many jobs.
Increasingly include lower-ranking employees.
Many companies now routinely reward production employees with bonuses when profits improve.
Downside: employees’ pay is more vulnerable to cuts.

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The use of bonuses is becoming more common in many organizations. An annual bonus is a significant component of total compensation for many jobs.
Bonus plans increasingly include lower-ranking employees; many companies now routinely reward production employees with bonuses in the thousands of dollars when profits improve. The incentive effects of performance bonuses should be higher than those of merit pay because rather than paying for performance years ago, which was rolled into base pay, bonuses reward recent performance. When times are bad, firms can cut bonuses to reduce compensation costs. The downside of bonuses is that employees’ pay is more vulnerable to cuts.
64

Variable-Pay Programs and Employee Motivation (6 of 8)
Profit-Sharing Plans
Organization-wide programs that distribute compensation based on some established formula centered around a company’s profitability.
Appear to have positive effects on employee attitudes at the organizational level.
Employees have a feeling of psychological ownership.

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Profit-sharing plans are organization-wide programs that distribute compensation based on some established formula centered around a company’s profitability. Compensation can be direct cash outlays or, particularly for top managers, allocations of stock options. Profit-sharing plans at the organizational level appear to have positive impacts on employee attitudes; employees report a greater feeling of psychological ownership.
65

Variable-Pay Programs and Employee Motivation (7 of 8)
Employee Stock Ownership Plan (ESOP)
A company-established benefit plan in which employees acquire stock, often at below-market prices, as part of their benefits.
Increases employee satisfaction and innovation.
Employees need to psychologically experience ownership.
Can reduce unethical behavior.
Can be used for community wealth building.

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Another variable-pay option is the employee stock ownership plan, or ESOP. An ESOP is a company-established benefit plan in which employees acquire stock, often at below-market prices, as part of their benefits.
Research on ESOPs indicates that they increase employee satisfaction and innovation. ESOPs have the potential to increase employee job satisfaction and work motivation, but employees need to psychologically experience ownership.
ESOP plans for top management can reduce unethical behavior. CEOs are more likely to manipulate firm earnings reports to make themselves look good in the short run when they don’t have an ownership share, even though this manipulation will eventually lead to lower stock prices. However, when CEOs own a large amount of stock, they report earnings accurately because they don’t want the negative consequences of declining stock prices.
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Variable-Pay Programs and Employee Motivation (8 of 8)
Evaluation of Variable Pay
Do variable-pay programs increase motivation and productivity?
Generally, yes, but that doesn’t mean everyone is equally motivated by them.

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Do variable-pay programs increase motivation and productivity? Generally, yes, but that doesn’t mean everyone is equally motivated by them.
Managers should monitor their employees’ performance–reward expectancy, since a combination of elements that makes employees feel that their greater performance will yield them greater results will be the most motivating.
67

Show How Flexible Benefits Turn Benefits Into Motivators
Developing a Benefits Package
Flexible benefits individualize rewards.
Allow each employee to choose the compensation package that best satisfies his or her current needs and situation.
Today, almost all major corporations in the United States offer flexible benefits.
However, it may be surprising that their usage is not yet global.

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Flexible benefits individualize rewards by allowing each employee to choose the compensation package that best satisfies his or her current needs and situation.
Flexible benefits can accommodate differences in employee needs based on age, marital status, spouses’ benefit status, and number and age of dependents.

Today, almost all major corporations in the United States offer flexible benefits.
However, it may be surprising that their usage is not yet global.
68

Identify the Motivational Benefits of Intrinsic Rewards
Employee Recognition Programs
Organizations are increasingly recognizing that important work rewards can be both intrinsic and extrinsic.
Rewards are intrinsic in the form of employee recognition programs and extrinsic in the form of compensation systems.

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Organizations are increasingly recognizing that important work rewards can be both intrinsic and extrinsic. Rewards are intrinsic in the form of employee recognition programs and extrinsic in the form of compensation systems.
Employee recognition programs range from a spontaneous and private thank-you to widely publicized formal programs in which specific types of behavior are encouraged and the procedures for attaining recognition are clearly identified.
An obvious advantage of recognition programs is that they are inexpensive: praise is free! With or without financial rewards, they can be highly motivating to employees.
69

Implications for Managers (1 of 3)
Recognize individual differences.
Spend the time necessary to understand what’s important to each employee.
Design jobs to align with individual needs and maximize their motivation potential.
Use goals and feedback.
You should give employees firm, specific goals, and they should get feedback on how well they are faring in pursuit of those goals.

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The study of what motivates individuals is ultimately key to organizational performance. Employees whose differences are recognized, who feel valued, and who have the opportunity to work in jobs that are tailored to their strengths and interests will be motivated to perform at the highest levels. Employee participation also can increase employee productivity, commitment to work goals, motivation, and job satisfaction. However, we cannot overlook the powerful role of organizational rewards in influencing motivation. Pay, benefits, and intrinsic rewards must be carefully and thoughtfully designed in order to enhance employee motivation toward positive organizational outcomes.
Managers should:
Recognize individual differences. Spend the time necessary to understand what’s important to each employee. Design jobs to align with individual needs and maximize their motivation potential.
Use goals and feedback. You should give employees firm, specific goals, and they should get feedback on how well they are faring in pursuit of those goals.
70

Implications for Managers (2 of 3)
Allow employees to participate in decisions that affect them.
Employees can contribute to setting work goals, choosing their own benefits packages, and solving productivity and quality problems.
Link rewards to performance.
Rewards should be contingent on performance, and employees must perceive the link between the two.

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In addition, managers should:
Allow employees to participate in decisions that affect them. Employees can contribute to setting work goals, choosing their own benefits packages, and solving productivity and quality problems.
Link rewards to performance. Rewards should be contingent on performance, and employees must perceive the link between the two.
71

Implications for Managers (3 of 3)
Check the system for equity.
Employees should perceive that individual effort and outcomes explain differences in pay and other rewards.

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Finally, managers should:
Check the system for equity. Employees should perceive that individual effort and outcomes explain differences in pay and other rewards.
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Questions?

Organizational Behavior

Eighteenth Edition, Global Edition

Chapter 11

Power and Politics

Learning Objectives (1 of 2)
11.1 Contrast leadership and power.
11.2 Explain the three bases of formal power and the two bases of personal power.
11.3 Explain the role of dependence in power relationships.
11.4 Identify power or influence tactics and their contingencies.

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After studying this chapter, you should be able to:
Contrast leadership and power.
Explain the three bases of formal power and the two bases of personal power.
Explain the role of dependence in power relationships.
Identify power or influence tactics and their contingencies.
2

Learning Objectives (2 of 2)
11.5 Identify the causes and consequences of abuse of power.
11.6 Describe how politics work in organizations.
11.7 Identify the causes, consequences, and ethics of political behavior.

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Additional objectives for this chapter.
Identify the causes and consequences of abuse of power.
Describe how politics work in organizations.
Identify the causes, consequences, and ethics of political behavior.
3

Define Power and Contrast Leadership and Power (1 of 2)
Power refers to a capacity that A has to influence the behavior of B, so that B acts in accordance with A’s wishes.
Power may exist but not be used.
Probably the most important aspect of power is that it is a function of dependence.
A person can have power over you only if he or she controls something you desire.

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Power refers to a capacity that A has to influence the behavior of B, so that B acts in accordance with A’s wishes. Power may exist but not be used. It is, therefore, a capacity or potential. Probably the most important aspect of power is that it is a function of dependence. The greater B’s dependence on A, the greater is A’s power in the relationship. Dependence, in turn, is based on alternatives that B perceives and the importance that B places on the alternative(s) that A controls. A person can have power over you only if he or she controls something you desire.

Define Power and Contrast Leadership and Power (2 of 2)
Leaders use power as a means of attaining group goals.
Goal compatibility
Power does not require goal compatibility, merely dependence.
The direction of influence.
Leadership focuses on the downward influence on one’s followers.
Leadership research emphasizes style.

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What is the difference between leadership and power? Leaders use power as a means of attaining group goals. Power doesn’t require goal compatibility, just dependence. In contrast, leadership requires some congruence between the goals of the leader and those being led. The direction of influence for leaders is downward.
Leadership research, for the most part, emphasizes style. The research on power focuses on tactics for gaining compliance. It goes beyond the individual as the exercise of power, because groups as well as individuals can use power to control other individuals or groups.

Explain Formal Power and Personal Power (1 of 2)
Formal Power
Coercive Power
Reward Power
Legitimate Power
Personal Power
Expert Power
Referent Power

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We can divide power into two general groupings: formal and personal.
Formal power is based on an individual’s position in an organization. There are three types of formal power: coercive, reward, and legitimate. Coercive power depends on fear of negative results. It rests on the application, or the threat of application, of physical sanctions such as the infliction of pain, the generation of frustration through restriction of movement, or the controlling by force of basic physiological or safety needs. At the organizational level, A has coercive power over B if A can dismiss, suspend, or demote B, assuming that B values his or her job. Similarly, if A can assign B work activities that B finds unpleasant or treat B in a manner that B finds embarrassing, A possesses coercive power over B.
Reward power is the opposite of coercive power. People comply because doing so produces positive benefits; therefore, one who can distribute rewards that others view as valuable will have power over those others. These rewards can be either financial—such as controlling pay rates, raises, and bonuses—or nonfinancial, including recognition, promotions, interesting work assignments, friendly colleagues, and preferred work shifts or sales territories.
Legitimate power is shown in formal groups and organizations through one’s structural position. It represents the power a person receives as a result of his or her position in the formal hierarchy. Legitimate power is broader than the power to coerce and reward. It includes acceptance of the authority of a position by members of an organization.
The second group of power—personal power—comes from an individual’s unique characteristics, and includes expert power and referent power. Expert power is influence wielded as a result of expertise, special skill, or knowledge. As jobs become more specialized, we become increasingly dependent on experts to achieve goals. Referent power’s source is identification with a person who has desirable resources or personal traits. If I admire and identify with you, you can exercise power over me because I want to please you. Referent power develops out of admiration of another and a desire to be like that person; it is a lot like charisma. It also explains why celebrities are paid millions of dollars to endorse products in commercials. Some people who are not in formal leadership positions nonetheless have referent power and exert influence over others because of their charismatic dynamism, likability, and emotional effects on us.
6

Explain Formal Power and Personal Power (2 of 2)
Which Bases of Power Are Most Effective?
Personal sources are most effective.
Both expert and referent power are positively related to employees’ satisfaction with supervision, their organizational commitment, and their performance, whereas reward and legitimate power seem to be unrelated to these outcomes.
Coercive power can be damaging.

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Which bases of power are most effective? Personal sources are most effective. Both expert and referent power are positively related to employees’ satisfaction with supervision, their organizational commitment, and their performance, whereas reward and legitimate power seem to be unrelated to these outcomes. Coercive power can be damaging.
7

Explain the Role of Dependence in Power Relationships (1 of 3)
The General Dependency Postulate
When you possess anything others require but that you alone control, you make them dependent upon you and, therefore, you gain power over them.
Dependence, then, is inversely proportional to the alternative sources of supply.

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The general dependency postulate says the greater B’s dependency on A, the greater the power A has over B. When you possess anything that others require but that you alone control, you make them dependent upon you and, therefore, you gain power over them. Dependency, then, is inversely proportional to the alternative sources of supply. This is why most organizations develop multiple suppliers rather than using just one. It also explains why so many of us aspire to financial independence.
8

Explain the Role of Dependence in Power Relationships (2 of 3)
What Creates Dependence?
Importance
Scarcity
Nonsubstitutability

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What creates dependence? To create dependence, the thing(s) you control must be perceived as being important. However, note that there are many degrees of importance, from needing the resource for survival to wanting a resource that is in fashion or adds to convenience.
A resource also needs to be perceived as scarce to create dependence. The scarcity–dependency relationship can further be seen in the power of occupational categories. Individuals in occupations in which the supply of personnel is low relative to demand can negotiate compensation and benefit packages far more attractive than can those in occupations where there is an abundance of candidates.
Nonsubstitutability means the fewer viable substitutes for a resource, the more power control that resource provides.
9

Explain the Role of Dependence in Power Relationships (3 of 3)
Exhibit 11-1 An Organizational Sociogram

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One tool to assess the exchange of resources and dependencies within an organization is social network analysis. This method examines patterns of communication among organizational members to identify how information flows between them.
Within a social network, or connections between people who share professional interests, each individual or group is called a node, and the links between nodes are called ties. When nodes communicate or exchange resources frequently, they are said to have very strong ties.
Exhibit 13-1 shows a graphical illustration of the associations among individuals in a social network, called a sociogram. It functions like an informal version of an organization chart. The difference is that a formal organization chart shows how authority is supposed to flow, whereas a sociogram shows how resources really flow in an organization.
Networks can create substantial power dynamics such as enforcing norms or creating change within an organization. So, employees who have many connections to an organizational social network are less likely to engage in corruption. Those in the position of brokers tend to have more power because they can leverage the unique resources they can acquire from different groups. In other words, many people are dependent upon brokers, which gives the brokers more power.
There are many ways to implement a social network analysis in an organization. Some organizations keep track of the flow of e-mail communications or document sharing across departments. Other organizations look at data from human resources information systems, analyzing how supervisors and subordinates interact with one another.
10

Identify Power or Influence Tactics and their Contingencies
Influence tactics:
Legitimacy
Rational persuasion
Inspirational appeals
Consultation
Exchange
Personal appeals
Ingratiating
Pressure
Coalitions

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Research has identified nine distinct influence or power tactics.
First is legitimacy: relying on your authority position or saying a request accords with organizational policies or rules.
Second is rational persuasion: presenting logical arguments and factual evidence to demonstrate a request is reasonable.
Third is inspirational appeals: developing emotional commitment by appealing to a target’s values, needs, hopes, and aspirations.
Fourth is consultation: increasing the target’s support by involving him or her in deciding how you will accomplish your plan.
Fifth is exchange: rewarding the target with benefits or favors in exchange for following a request.
Sixth is personal appeals: asking for compliance based on friendship or loyalty.
Seventh is ingratiation: using flattery, praise, or friendly behavior prior to making a request.
Eighth is pressure: using warnings, repeated demands, and threats.
Nine is coalitions: enlisting the aid or support of others to persuade the target to agree.
11

Identify Nine Power or Influence Tactics and their Contingencies (1 of 4)
Some tactics are more effective than others.
Rational persuasion, inspirational appeals, and consultation are most effective when the audience is highly interested in the outcomes.
Pressure tends to backfire.
Both ingratiation and legitimacy can lessen the negative reactions from appearing to “dictate” outcomes.

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Some tactics are more effective than others. Rational persuasion, inspirational appeals, and consultation tend to be the most effective, especially when the audience is highly interested in the outcomes of a decision process. Pressure tends to backfire and is typically the least effective of the nine tactics.
You can also increase your chance of success by using more than one type of tactic at the same time or sequentially, as long as your choices are compatible. Using both ingratiation and legitimacy can lessen the negative reactions from appearing to “dictate” outcomes, but only when the audience does not really care about the outcomes of a decision process or the policy is routine.
12

Identify Nine Power or Influence Tactics and their Contingencies (2 of 4)
Exhibit 11-2 Preferred Power Tactics by Influence Direction
Upward Influence Downward Influence Lateral Influence
Rational persuasion Rational persuasion Rational persuasion
Blank Inspirational appeals Consultation
Blank Pressure Ingratiation
Blank Consultation Exchange
Blank Ingratiation Legitimacy
Blank Exchange Personal appeals
Blank Legitimacy Coalitions

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As Exhibit 13-2 shows, rational persuasion is the only tactic effective across organizational levels. Inspirational appeals work best as a downward influencing tactic with subordinates. When pressure works, it’s generally downward only. Personal appeals and coalitions are most effective as lateral influence. Other factors that affect the effectiveness of influence include the sequencing of tactics, a person’s skill in using the tactic, and the organizational culture.
You’re more likely to be effective if you begin with “softer” tactics that rely on personal power, such as personal and inspirational appeals, rational persuasion, and consultation. If these fail, you can move to “harder” tactics, such as exchange, coalitions, and pressure, which emphasize formal power and incur greater costs and risks. Interestingly, a single soft tactic is more effective than a single hard tactic, and combining two soft tactics or a soft tactic and rational persuasion is more effective than any single tactic or combination of hard tactics.
The effectiveness of tactics depends on the audience. People especially likely to comply with soft power tactics tend to be more reflective, are intrinsically motivated, have high self-esteem, and have greater desire for control. In contrast, people especially likely to comply with hard power tactics are more action-oriented and extrinsically motivated, and are more focused on getting along with others than with getting their own way.
13

Identify Nine Power or Influence Tactics and their Contingencies (3 of 4)
People in different countries prefer different power tactics.
Individualistic countries see power in personalized terms and as a legitimate means of advancing their personal ends.
Collectivistic countries see power in social terms and as a legitimate means of helping others.

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People in different countries prefer different power tactics. Those from individualistic countries tend to see power in personalized terms and as a legitimate means of advancing their personal ends, whereas those in collectivistic countries see power in social terms and as a legitimate means of helping others.
A study comparing managers in the United States and China found that U.S. managers prefer rational appeal, whereas Chinese managers prefer coalition tactics. These differences tend to be consistent with the values in these two countries. The reason is consistent with the U.S. preference for direct confrontation and rational persuasion to influence others and resolve differences, while coalition tactics align with the Chinese preference for meeting difficult or controversial requests with indirect approaches.
14

Identify Nine Power or Influence Tactics and their Contingencies (4 of 4)
Applying Power Tactics
People differ in terms of their political skill: their ability to influence others to enhance their own objectives.
The politically skilled are more effective users of all the influence tactics.
Cultures within organizations differ markedly: some are warm, relaxed, and supportive; others are formal and conservative.
People who fit the culture of the organization tend to obtain more influence.

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People differ in terms of their political skill – their ability to influence others to enhance their own objectives. The politically skilled are more effective users of all influence tactics, leading to many positive outcomes in the workplace. People who are politically skilled have higher self-efficacy, job satisfaction, work productivity, and career success. They are less likely to be victims of workplace aggression. Political skill also appears more effective when the stakes are high.
Finally, the politically skilled are able to exert their influence without others detecting it, a key element in effectiveness.
Also, we know that cultures within organizations differ markedly: some are warm, relaxed, and supportive; others are formal and conservative. Some cultures encourage participation and consultation, some encourage reason, and still others rely on pressure. People who fit the culture of the organization tend to obtain more influence. Specifically, extraverts tend to be more influential in team-oriented organizations, and highly conscientious people are more influential in organizations that value working alone on technical tasks. Part of the reason people who fit the culture are influential is that they are able to perform especially well in the domains deemed most important for success. In other words, they are influential because they are competent. So the organization itself will influence which subset of power tactics is viewed as acceptable for use.
15

Causes and Consequences of Abuse of Power (1 of 4)
Does power corrupt?
Power leads people to place their own interests ahead of others.
Powerful people react, especially negatively, to any threats to their competence.
Power leads to overconfident decision making.
Power doesn’t affect everyone in the same way, and there are even positive effects of power.

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Does power corrupt? Evidence suggests that power leads people to place their own interests ahead of others. Powerful people react—especially negatively—to any threats to their competence. Power also leads to overconfident decision making. Power doesn’t affect everyone in the same way, and there are even positive effects of power. Let’s consider each of these in turn.
First, the toxic effects of power depend on one’s personality. Research suggests that if we have an anxious personality, power does not corrupt us because we are less likely to think that using power benefits us. Second, the corrosive effect of power can be contained by organizational systems. One study found, for example, that while power made people behave in a self-serving manner, when accountability of this behavior was initiated, the self-serving behavior stopped. Third, we have the means to blunt the negative effects of power. One study showed that simply expressing gratitude toward powerful others makes them less likely to act aggressively against us.
Finally, remember the aphorism that those with little power grab and abuse what little they have? There appears to be some truth to this in that the people most likely to abuse power are those who are low in status and gain power. Why is this the case? It appears that having low status is threatening, and this fear is used in negative ways if power is given.
As you can see, there are factors that can ameliorate the negative effects of power. But there also appear to be generally positive effects. Power can energize people and motivate them to achieve goals (i.e., approach motivation). It also can enhance people’s motivation to help others, at least for certain people. It is not so much that power corrupts as it reveals. For those with strong moral identities, power actually enhanced their moral awareness. And willingness to act.
16

Causes and Consequences of Abuse of Power (2 of 4)
Sexual harassment: any unwanted activity of a sexual nature that affects an individual’s employment and creates a hostile work environment.
Organizations have generally made progress in the past decade toward limiting overt forms of sexual harassment.
Managers have a responsibility to protect their employees from a hostile work environment, but they also need to protect themselves.

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Sexual harassment is defined as any unwanted activity of a sexual nature that affects an individual’s employment and creates a hostile work environment.
Organizations have generally made progress in the past decade toward limiting overt forms of sexual harassment. Generally, sexual harassment is more prevalent in male-dominated societies. Most studies confirm that the concept of power is central to understanding sexual harassment.
The bottom line is that managers have a responsibility to protect their employees from a hostile work environment, but they also need to protect themselves.
17

Causes and Consequences of Abuse of Power (3 of 4)
Mangers should:
Make sure an active policy defines what constitutes sexual harassment, informs employees they can be fired for sexually harassing another employee, and establishes procedures for how complaints can be made.
Reassure employees that they will not encounter retaliation if they issue a complaint.

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The following are some ways managers can protect themselves and their employees from sexual harassment:
Make sure an active policy defines what constitutes sexual harassment, informs employees they can be fired for sexually harassing another employee, and establishes procedures for how complaints can be made.
Reassure employees that they will not encounter retaliation if they issue a complaint.
18

Causes and Consequences of Abuse of Power (4 of 4)
In addition, managers should:
Investigate every complaint and include the legal and human resource departments.
Make sure offenders are disciplined or terminated.
Set up in-house seminars to raise employee awareness of the issues surrounding sexual harassment.

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Managers also need to:
Investigate every complaint and include the legal and human resource departments.
Make sure offenders are disciplined or terminated.
Set up in-house seminars to raise employee awareness of the issues surrounding sexual harassment.
19

Describe How Politics Work in Organizations (1 of 2)
Political behavior: activities that are not required as part of one’s formal role in the organization, but that influence the distribution of advantages within the organization.
Outside of one’s specified job requirements.
Encompasses efforts to influence decision- making goals, criteria, or processes.
Includes such behaviors as withholding information, whistle-blowing, spreading rumors, and leaking confidential information.

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Political behavior is defined as those activities that are not required as part of one’s formal role in the organization, but that influence, or attempt to influence, the distribution of advantages and disadvantages within the organization. This definition encompasses key elements. Political behavior is outside one’s specified job requirements. It encompasses efforts to influence the goals, criteria, or processes used for decision making. It includes such varied political behaviors as withholding key information from decision makers, whistle-blowing, spreading rumors, and leaking confidential information.
20

Describe How Politics Work in Organizations (2 of 2)
OB POLL Importance of Organizatoinal Politics from
Source: Based on D. Crampton, “Is How Americans Feel about Their Jobs Changing?” (September 28, 2012), http://corevalues.com/employee-motivation/is-how-americans-feel-about-their-jobs-changing.

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As the OB Poll shows, politics are not only inevitable, they might be essential too. People want to carve out a niche to exert influence, earn rewards, and advance their careers.
21

Causes and Consequences of Political Behavior (1 of 7)
Exhibit 11-3 Factors That Influence Political Behavior

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Factors contributing to political behavior, as shown here in Exhibit 13-3, include individual factors. Researchers have identified certain personality traits, needs, and other factors that are likely to be related to political behavior. Employees who are high self-monitors, possess an internal locus of control, and have a high need for power are more likely to engage in political behavior. The high self-monitor is more sensitive to social cues and is more likely to be skilled in political behavior than the low self-monitor. Individuals with an internal locus of control are more prone to take a proactive stance and attempt to manipulate situations in their favor. The Machiavellian personality is comfortable using politics as a means to further his/her self-interest. An individual’s investment in the organization, perceived alternatives, and expectations of success will also influence the tendency to pursue illegitimate means of political action.
The organizational factors that influence politics are many. Political activity is probably more a function of the organization’s characteristics than of individual difference variables. When an organization’s resources are declining, when the existing pattern of resources is changing, and when there is opportunity for promotions, politics is more likely to surface. Cultures characterized by low trust, role ambiguity, unclear performance evaluation systems, zero-sum reward allocation practices, democratic decision making, high pressures for performance, and self-serving senior managers will create breeding grounds for politicking. When organizations downsize to improve efficiency, people may engage in political actions to safeguard what they have. Promotion decisions have consistently been found to be one of the most political in organizations.
22

Causes and Consequences of Political Behavior (2 of 7)
Exhibit 11-4 Employee Responses to Organizational Politics from

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For most people, those who have modest political skills or are unwilling to play the politics game, outcomes tend to be predominantly negative. Exhibit 13-4 summarizes the extensive research on the relationship between organizational politics and individual outcomes. There is very strong evidence indicating that perceptions of organizational politics are negatively related to job satisfaction. The perception of politics leads to anxiety or stress. When it gets to be too much to handle, employees quit.
When employees of two agencies in a recent study in Nigeria viewed their work environments as political, they reported higher levels of job distress and were less likely to help their coworkers. Thus, although developing countries such as Nigeria are perhaps more ambiguous and more political environments in which to work, the negative consequences of politics appear to be the same as in the United States.
23

Causes and Consequences of Political Behavior (3 of 7)
Exhibit 11-5 Defensive Behaviors
Avoiding Action
Overconforming. Strictly interpreting your responsibility by saying things like “The rules clearly state…”or “This is the way we’ve always done it.”
Buck passing. Transferring responsibility for the execution of a task or decision to someone else.
Playing dumb. Avoiding an unwanted task by falsely pleading ignorance or inability.
Stretching. Prolonging a task so that one person appears to be occupied—for example, turning a two-week task into a 4-month job.
Stalling. Appearing to be more or less supportive publicly while doing little or nothing privately.
Avoiding Blame
Bluffing. Rigorously documenting activity to project an image of competence and thoroughness, known as “covering your rear.”
Playing safe. Evading situations that may reflect unfavorably. It includes taking on only projects with a high probability of success, having risky decisions approved by superiors, qualifying expressions of judgment, and taking neutral positions in conflicts.
Justifying. Developing explanations that lessen one’s responsibility for a negative outcome and/or apologizing to demonstrate remorse, or both.

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The politics–performance relationship appears to be moderated by an individual’s understanding of the “hows” and “whys” of organizational politics. Political behavior and work moderates the effects of ethical leadership.
When employees see politics as a threat, they often respond with defensive behaviors—reactive and protective behaviors to avoid action, blame, or change. Exhibit 13-5 provides some examples of these behaviors. Defensive behaviors are often associated with negative feelings toward the job and work environment. In the short run, employees may find that defensiveness protects their self-interest, but in the long run it wears them down. People who consistently rely on defensiveness find that, eventually, it is the only way they know how to behave. At that point, they lose the trust and support of their peers, bosses, employees, and clients.
24

Causes and Consequences of Political Behavior (4 of 7)
[Exhibit 11-5 Continued]
Scapegoating. Placing the blame for a negative outcome on external factors that are not entirely blameworthy.
Misrepresenting. Manipulation of information by distortion, embellishment, deception, selective presentation, or obfuscation.
Avoiding Change
Prevention. Trying to prevent a threatening change from occurring.
Self-protection. Acting in ways to protect one’s self-interest during change by guarding information or other resources.

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The politics-performance relationship appears to be moderated by an individual’s understanding of the “hows” and “whys” of organizational politics. Political behavior and work moderates the effects of ethical leadership.
When employees see politics as a threat, they often respond with defensive behaviors — reactive and protective behaviors to avoid action, blame, or change. Exhibit 13-5 provides some examples of these behaviors. Defensive behaviors are often associated with negative feelings toward the job and work environment. In the short run, employees may find that defensiveness protects their self-interest, but in the long run it wears them down. People who consistently rely on defensiveness find that, eventually, it is the only way they know how to behave. At that point, they lose the trust and support of their peers, bosses, employees, and clients.
25

Causes and Consequences of Political Behavior (5 of 7)
Impression management (IM): the process by which individuals attempt to control the impression others form of them.
Mostly high self-monitors.
Impressions people convey are not necessarily false – they might truly believe them.
Intentional misrepresentation may have a high cost.
The effectiveness of IM depends on the situation.

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We know that people have an ongoing interest in how others perceive and evaluate them. Being perceived positively by others should have benefits for people in organizations. The process by which individuals attempt to control the impression others form of them is called impression management (IM). Who engages in IM—mostly the high self-monitors. Low self-monitors tend to present images of themselves that are consistent with their personalities, regardless of the beneficial or detrimental effects for them. High self-monitors are good at reading situations and molding their appearances and behavior to fit each situation.
IM does not imply that the impressions people convey are necessarily false. Excuses and acclaiming, for instance, may be offered with sincerity. You can actually believe that ads contribute little to sales in your region, or that you are the key to the tripling of your division’s sales. However, misrepresentation can have a high cost. If the image claimed is false, you may be discredited.
Research shows that the particular situation also appears to influence the effectiveness of IM. For example, self-promotion tactics may be more important to interviewing success. Applicants who work to create an appearance of competence by enhancing their accomplishments, taking credit for successes, and explaining away failures do better in interviews. In terms of performance ratings, however, the picture is quite different. Ingratiation is positively related to performance ratings, meaning those who ingratiate with their supervisors get higher performance evaluations. However, self-promotion appears to backfire in this situation.
26

Causes and Consequences of Political Behavior (6 of 7)
The Ethics of Behaving Politically
Questions to consider:
What is the utility of engaging in politicking?
How does the utility of engaging in the political behavior balance out any harm (or potential harm) it will do to others?
Does the political activity conform to standards of equity and justice?

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Although there are no clear-cut ways to differentiate ethical from unethical politicking, there are some questions you should consider.
For example, what is the utility of engaging in politicking? Sometimes we engage in political behavior for little good reason. Major league baseball player Al Martin claimed he played football at USC when in fact he never did. As a baseball player, he had little to gain by pretending to have played football. Outright lies like this may be a rather extreme example of impression management, but many of us have distorted information to make a favorable impression. One thing to keep in mind is whether it’s really worth the risk.
When faced with an ethical dilemma regarding organizational politics, one question to ask is, “How does the utility of engaging in the political behavior balance out any harm (or potential harm) it will do to others?” Complimenting a supervisor on his or her appearance in order to curry favor is probably much less harmful than grabbing credit for a project that others deserve.
Also, does the political activity conform to standards of equity and justice? Sometimes it is difficult to weigh the costs and benefits of a political action, but its ethicality is clear. The department head who inflates the performance evaluation of a favored employee and deflates the evaluation of a disfavored employee—and then uses these evaluations to justify giving the former a big raise and nothing to the latter—has treated the disfavored employee unfairly.
Unfortunately, powerful people can become very good at explaining self-serving behaviors in terms of the organization’s best interests. They can persuasively argue that unfair actions are really fair and just. Our point is that immoral people can justify almost any behavior. Those who are powerful, articulate, and persuasive are most vulnerable to ethical lapses because they are likely to be able to get away with unethical practices successfully. If you have a strong power base, recognize the ability of power to corrupt. Remember that it’s a lot easier for the powerless to act ethically, if for no other reason than they typically have very little political discretion to exploit.
27

Causes and Consequences of Political Behavior (7 of 7)
Exhibit 11-7 Drawing Your Political Map

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Mapping your political career. One of the most useful ways to think about power and politics is in terms of your own career.
Think about your career in your organization of choice. What are your ambitions? Who has the power to help you get there? What is your relationship with these people? The best way to answer these questions is with a political map, like the one shown in Exhibit 13-7, which can help you sketch out your relationships with the people upon whom your career depends.
Power and politics are a part of organizational life. To decide not to play is deciding not to be effective. Better to be explicit about it with a political map than to proceed as if power and politics didn’t matter.
28

Implications for Managers (1 of 2)
To maximize your power, increase others’ dependence on you. For instance, increase your power in relation to your boss by developing a needed knowledge or skill for which there is no ready substitute.
You will not be alone in attempting to build your power bases. Others, particularly employees and peers, will be seeking to increase your dependence on them, while you are trying to minimize it and increase their dependence on you.
Try to avoid putting others in a position where they feel they have no power.

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Few employees relish being powerless in their job and organization. People respond differently to the various power bases. Expert and referent power are derived from an individual’s personal qualities. In contrast, coercion, reward, and legitimate power are essentially organizationally derived. Competence especially appears to offer wide appeal, and its use as a power base results in high performance by group members.
An effective manager accepts the political nature of organizations. Some people are significantly more politically astute than others, meaning that they are aware of the underlying politics and can manage impressions. Those who are good at playing politics can be expected to get higher performance evaluations and, hence, larger salary increases and more promotions than the politically naïve or inept. The politically astute are also likely to exhibit higher job satisfaction and be better able to neutralize job stressors.
How should managers deal with power and politics in their organization?
To maximize your power, increase others’ dependence on you. For instance, increase your power in relation to your boss by developing a needed knowledge or skill for which there is no ready substitute.
You will not be alone in attempting to build your power bases. Others, particularly employees and peers, will be seeking to increase your dependence on them, while you are trying to minimize it and increase their dependence on you.
Try to avoid putting others in a position where they feel they have no power.
29

Implications for Managers (2 of 2)
By assessing behavior in a political framework, you can better predict the actions of others and use that information to formulate political strategies that will gain advantages for you and your work unit.
Consider that employees who have poor political skills or are unwilling to play the politics game generally relate perceived organizational politics to lower job satisfaction and self-reported performance, increased anxiety, and higher turnover. Therefore, if you are adept at organizational politics, help your employees understand the importance of becoming politically savvy.

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By assessing behavior in a political framework, you can better predict the actions of others and use that information to formulate political strategies that will gain advantages for you and your work unit.
Consider that employees who have poor political skills or are unwilling to play the politics game generally relate perceived organizational politics to lower job satisfaction and self-reported performance, increased anxiety, and higher turnover. Therefore, if you are adept at organizational politics, help your employees understand the importance of becoming politically savvy.
30

Questions?

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Organizational Behavior
Eighteenth Edition, Global Edition
Chapter 12
Communication
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Welcome to this Organizational Behavior course that uses the 17th edition of the textbook, Organizational Behavior by Robbins and Judge. This is considered among the most widely used OB textbooks in the world. Robbins and Judge are recognized as definitive aggregators of OB concepts, applications, and practices. The course and this book will provide you with a resource that will benefit you throughout your degree program and your professional life.
Chapter 11: Communication
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Learning Objectives (1 of 2)
12.1 Describe the functions and process of communication.
12.2 Contrast downward, upward, and lateral communication through small-group networks and the grapevine.
12.3 Contrast oral, written, and nonverbal communication.
12.4 Describe how channel richness underlies the choice of communication channel.
12.5 Differentiate between automatic and controlled processing of persuasive messages.

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After studying this chapter, you should be able to:
Describe the functions and process of communication.
Contrast downward, upward, and lateral communication through small-group networks and the grapevine.
Contrast oral, written, and nonverbal communication.
Describe how channel richness underlies the choice of communication channel.
Differentiate between automatic and controlled processing of persuasive messages.
35

Learning Objectives (2 of 2)
12.6 Identify common barriers to effective communication.
12.7 Discuss how to overcome the potential problems of cross-cultural communication.

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Additional objectives for this chapter.
Identify common barriers to effective communication.
Discuss how to overcome the potential problems of cross-cultural communication.
36

Describe the Functions and Process of Communication (1 of 7)
Communication serves five major functions within a group or organization:
Management
Feedback
Emotional sharing
Persuasion
Information exchange

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Communication serves five major functions within a group or organization: management, feedback, emotional sharing, persuasion, and information exchange.
37

Describe the Functions and Process of Communication (2 of 7)
Communication acts to manage member behavior in several ways.
Authority hierarchies and formal guidelines.
Job descriptions and company policies.
Workgroup teasing or harassing.

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Communication acts to manage member behavior in several ways.
Organizations have authority hierarchies and formal guidelines employees are required to follow. When employees follow their job descriptions or comply with company policies, communication performs a management function. Informal communication controls behavior too. When workgroups tease or harass a member who produces too much (and makes the rest of the members look bad), they are informally communicating, and managing the member’s behavior.
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Communication creates feedback by clarifying to employees what they must do, how well they are doing it, and how they can improve their performance.
Formation of goals, feedback on progress, and reward for desired behavior all require communication and stimulate motivation.
Describe the Functions and Process of Communication (3 of 7)

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Communication creates feedback by clarifying to employees what they must do, how well they are doing it, and how they can improve their performance.
Formation of goals, feedback on progress, and reward for desired behavior all require communication and stimulate motivation.

Describe the Functions and Process of Communication (4 of 7)
Communication within the group is a fundamental mechanism by which members show satisfaction and frustration.
Communication, therefore, provides for the emotional sharing of feelings and fulfillment of social needs.

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Communication within the group is a fundamental mechanism by which members show satisfaction and frustration. Communication, therefore, provides for the emotional sharing of feelings and fulfillment of social needs. For example, after a white police officer shot an unarmed black man in Ferguson, Missouri in 2015, software engineer Carl Jones wanted to process his feelings through talking with his coworkers at his corporation. As a second example, Starbucks had baristas write “Race Together” on coffee cups to start conversations about race relations. In both cases, the initial communications were awkward—so awkward that Starbucks pulled the campaign—but Jones and others have forged solid relationships from their emotional sharing.

Describe the Functions and Process of Communication (5 of 7)
Like emotional sharing, persuasion can be good or bad depending on if, say, a leader is trying to persuade a workgroup to believe in the organization’s commitment to corporate social responsibility (CSR) or to, conversely, persuade the workgroup to break the law to meet an organizational goal.
Persuasion can benefit or harm an organization.

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Like emotional sharing, persuasion can be good or bad depending on if, say, a leader is trying to persuade a workgroup to believe in the organization’s commitment to corporate social responsibility (CSR) or to, conversely, persuade the workgroup to break the law to meet an organizational goal.
It’s important to remember that persuasion can benefit or harm an organization.
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Describe the Functions and Process of Communication (6 of 7)
The final function of communication is information exchange to facilitate decision making.
Communication provides the information individuals and groups need to make decisions by transmitting the data needed to identify and evaluate choices.

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The final function of communication is information exchange to facilitate decision making. Communication provides the information individuals and groups need to make decisions by transmitting the data needed to identify and evaluate choices.
Almost every communication interaction that takes place in a group or organization performs one or more of these functions, and none of the five is more important than the others. To perform effectively, groups need to maintain some control over members, provide feedback to stimulate members to perform, allow emotional expression, monitor the persuasive efforts of individuals, and encourage information exchange.
42

Describe the Functions and Process of Communication (7 of 7)
Exhibit 12-1 The Communication Process

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As shown here in Exhibit 11-1, the communication process is made up of eight parts: the sender, encoding, the message, the channel, decoding, the receiver, noise, and feedback.
The sender initiates a message by encoding a thought. The message is the actual physical product from the source. The channel is the medium through which the message travels. The sender selects it, determining whether to use a formal or informal channel.
Formal channels are established by the organization and transmit messages related to the professional activities of members. They traditionally follow the authority chain within the organization. Other forms of messages, such as personal or social, follow informal channels, which are spontaneous and emerge as a response to individual choices
The receiver is the person(s) to whom the message is directed, who must first translate the symbols into understandable form. This step is the decoding of the message. Noise represents communication barriers that distort the clarity of the message, such as perceptual problems, information overload, semantic difficulties, or cultural differences. The final link in the communication process is a feedback loop. Feedback is the check on how successful we have been in transferring our messages as originally intended. It determines whether understanding has been achieved.
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Contrast Downward, Upward, and Lateral Communication (1 of 7)
Downward communication: flows from one level to a lower level.
Assign goals, provide instructions, communicate policies and procedures, and provide feedback.
Downward communication must explain the reasons why a decision was made.
One problem is the one-way nature of downward communication.

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Downward communication occurs when communication flows from one level of a group organization to a lower level. Its purpose is to assign goals, provide instructions, communicate policies and procedures, provide feedback, etc.
When engaging in downward communication, managers must explain the reasons why a decision was made. Explanations increase employee commitment and support of decisions. One problem in downward communication is its one-way nature; generally, managers inform employees but rarely solicit their advice or opinions. The best communicators explain the reasons behind their downward communications but also solicit communication from the employees they supervise.
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Contrast Downward, Upward, and Lateral Communication (2 of 7)
Upward communication: flows to a higher level in the group or organization.
Provide feedback to higher-ups, inform them of progress, and relay current problems.
Communicate in headlines, not paragraphs.
Support your headlines with actionable items.
Prepare an agenda to make sure you use your boss’s attention well.

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Upward communication flows to a higher level in the group or organization. It is used to provide feedback to higher-ups, inform them of progress, and relay current problems.
Managers rely on upward communication for ideas on how conditions can be improved. To engage in effective upward communication, communicate in headlines, not paragraphs. Your goal is to get your boss’s attention, not to engage in a meandering discussion. Support your headlines with actionable items. That is, what you believe should happen. Prepare an agenda to make sure you use your boss’s attention well.
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Contrast Downward, Upward, and Lateral Communication (3 of 7)
Lateral communication: takes place among members of the same work group, among members of work groups at the same level, among managers at the same level, or among any horizontally equivalent personnel.
Often necessary to save time and facilitate coordination.
May be formally sanctioned.
Can create dysfunctional conflicts.

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Lateral communication takes place among members of the same work-group, among members of work-groups at the same level, among managers at the same level, or among any horizontally equivalent personnel.
Lateral communications are often necessary to save time and facilitate coordination. In some cases, these lateral relationships are formally sanctioned. Often, they are informally created to short-circuit the vertical hierarchy and expedite action. They can create dysfunctional conflicts when the formal vertical channels are breached, when members go above or around their superiors to get things done, or when bosses find out that actions have been taken or decisions made without their knowledge.
46

Contrast Downward, Upward, and Lateral Communication (4 of 7)
Exhibit 12-2 Three Common Small-Group Networks

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Formal organizational networks can be complicated, including hundreds of people and a half-dozen or more hierarchical levels. To simplify, we’ve condensed these networks into three common small-group networks of five people each: chain, wheel, and all channel, as shown here in Exhibit 11-2.
The chain rigidly follows the formal chain of command; this network approximates the communication channels you might find in a rigid three-level organization. The wheel relies on a central figure to act as the conduit for all group communication; it simulates the communication network you would find on a team with a strong leader. The all-channel network permits group members to actively communicate with each other; it’s most often characterized in practice by self-managed teams, in which group members are free to contribute and no one person takes on a leadership role.
47

Contrast Downward, Upward, and Lateral Communication (5 of 7)
Exhibit 12-3 Small-Group Networks and Effective Criteria
Criteria Chain Networks Wheel All-Channel
Speed Moderate Fast Fast
Accuracy High High Moderate
Emergence of a leader Moderate High None
Member satisfaction Moderate Low High

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As Exhibit 11-3 demonstrates, the effectiveness of each network depends on the dependent variable that concerns you. The structure of the wheel facilitates the emergence of a leader, the all-channel network is best if you desire high member satisfaction, and the chain is best if accuracy is most important. This exhibit leads us to the conclusion that no single network will be best for all occasions.

Contrast Downward, Upward, and Lateral Communication (6 of 7)
The informal communication network in a group or organization is called the grapevine.
It gives managers a feel for the morale of their organization, identifies issues employees consider important, and helps tap into employee anxieties.

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The informal communication network in a group or organization is called the grapevine. The grapevine is an important part of any group or organization communication network.
It gives managers a feel for the morale of their organization, identifies issues employees consider important, and helps tap into employee anxieties.
The grapevine also serves employees’ needs: small talk creates a sense of closeness and friendship among those who share information, although research suggests it often does so at the expense of those in the “out” group.
There is also evidence that gossip is driven largely by employee social networks that managers can study to learn more about how positive and negative information is flowing through their organization.
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Contrast Downward, Upward, and Lateral Communication (7 of 7)
Exhibit 12-4 Dealing with Gossip and Rumors
Share the information you have, and the information you don’t—where there is good formal communication with much information, there is no need for rumors. When you don’t know information that others are seeking, discuss when you will know and follow up.
Explain, explain, explain. As a manager, discuss what decisions are made and why they were made, as well as the plan going forward.
Respond to rumors noncommittally, and then verify for yourself the truths you can. Make certain to gather all sides of the story.
Invite employees to discuss their concerns, ideas, suggestions, thoughts, and feelings about organizational matters. Help them frame their thoughts into more objective viewpoints.

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As shown here in Exhibit 11-4, managers should minimize the negative consequences of rumors by limiting their range and impact.

Contrast Oral, Written, and Nonverbal Communication (1 of 7)
Oral Communication
The primary means of conveying messages. Speeches, formal one-on-one and group discussions, and informal rumor mills or grapevines are popular forms of oral communication.
Meetings
Videoconferencing and conference calling
Telephone

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Oral communication is the chief means of conveying messages. Speeches, formal one-on-one and group discussions, and informal rumor mills or grapevines are popular forms of oral communication. Advantages or oral communication are speed and feedback. A major disadvantage arises when the message must be passed through a number of people. This increases the potential for distortion.
Four popular forms of oral communication used in organizations are:
Meetings – can be formal or informal, include two or more people, and take place in almost any venue.
Videoconferencing – permits employees and clients to conduct real-time meetings with people at different locations.
Conference calling – generally limited to telephone exchanges where some people may gather around one speaker-phone, and others call in through a secure line.
Telephone – offers many of the benefits of meetings (formal and informal), and can prompt immediate response.
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Contrast Oral, Written, and Nonverbal Communication (2 of 7)
Written Communication
Letters
PowerPoint
E-mail
Instant Messaging
Text Messaging
Social Media
Aps
Blogs

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Written communications include:
Letters – the oldest and most enduring form of written communication.
PowerPoint – can be an excellent mode of communication because it combines words with visual elements to help engage the reader and explain complex ideas; however, detractors argue that it is too impersonal, disengaging, and frequently misused.
E-mail – has become so pervasive it’s hard to imagine life without it.
Instant Messaging – a-synchronous technology, meaning that you need to be there to receive the message.
Text Messaging – usually done via cell phone and often as a real-time alternative to phone calls.
Social Media – has transformed communication. According to research advisory firm Gartner Inc., companies that use social media as more than a marketing tool may lead their industries in growth by 2015.
Blogs (short for web-log) – a website about a single person or company. Many organizations and organizational leaders have blogs that speak for the organization.
Others – Flickr, Pinterest, and Google+ are just a few of the many public and industry-specific social platforms.
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Contrast Oral, Written, and Nonverbal Communication (3 of 7)
Exhibit 12-5 Allocation of Time at Work for Managers and Professionals
Source: Based on M. Chui et al., “The Social Economy: Unlocking Value and Productivity through Social Technologies,” McKinsey & Company, July 2012, http://www.mckinsey.com/insights/high_tech_telecoms_internet/the_social_economy.

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Many managers report that they spend too much time on e-mail. Exhibit 11-5 shows that managers spend nearly one-third of their day reading and answering e-mail.
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Contrast Oral, Written, and Nonverbal Communication (4 of 7)
OB POLL Do You Use Social-Networking Sites to Research Job Candidates

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Social media has become a tool for prospective employees, hiring managers, and human resource divisions.
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Contrast Oral, Written, and Nonverbal Communication (5 of 7)
Nonverbal Communication
Includes body movements, the intonations or emphasis we give to words, facial expressions, and the physical distance between the sender and receiver.
Body language can convey status, level of engagement, and emotional state.

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Every time we deliver a verbal message, we also impart a nonverbal message. Sometimes the nonverbal component may stand alone. No discussion of communication would thus be complete without consideration of nonverbal communication, which includes body movements, the intonations or emphasis we give to words, facial expressions, and the physical distance between the sender and receiver.

Contrast Oral, Written, and Nonverbal Communication (6 of 7)
Exhibit 12-6 Intonations: It’s the Way You Say It!
Change your tone and you change your meaning: Blank
Placement of the Emphasis What It Means
Why don’t I take you to dinner tonight? I was going to take someone else.
Why don’t I take you to dinner tonight? Instead of the guy you were going with.
Why don’t I take you to dinner tonight? I’m trying to find a reason why I shouldn’t take you.
Why don’t I take you to dinner tonight? Do you have a problem with me?
Why don’t I take you to dinner tonight? Instead of going on your own.
Why don’t I take you to dinner tonight? Instead of lunch tomorrow.
Why don’t I take you to dinner tonight? Not tomorrow night.

Source: Reproduced in A. Huczynski and D. Buchanan, Organizational Behavior, 4th ed. (Essex, UK: Pearson Education, 2001), 194.

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If you read the verbatim minutes of a meeting, you wouldn’t grasp the impact of what was said the same way as if you had been there or could see the meeting on video, because there is no record of nonverbal communication. The emphasis given to words or phrases is missing.
Exhibit 11-6 illustrates how intonations can change the meaning of a message.
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Contrast Oral, Written, and Nonverbal Communication (7 of 7)
Physical distance also has meaning.
What is considered proper spacing between people largely depends on cultural norms.
A businesslike distance in some European countries feels intimate in many parts of North America.
Distance may indicate aggressiveness or sexual interest, or it may signal disinterest or displeasure with what is being said.

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Physical distance also has meaning. What is considered proper spacing between people largely depends on cultural norms. A business-like distance in some European countries feels intimate in many parts of North America. If someone stands closer to you than is considered appropriate, it may indicate aggressiveness or sexual interest; if farther away, it may signal disinterest or displeasure with what is being said.
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Channel Richness and Choice of Communication Channel (1 of 4)
Exhibit 12-7 Information Richness and Communication Channels
Source: Reproduced from R. L. Daft and R. A. Noe, Organizational Behavior (Fort Worth, TX: Harcourt, 2001), 311.

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Exhibit 11-7 shows that channels differ in their capacity to convey information. Some are rich in that they have the ability to handle multiple cues simultaneously, facilitate rapid feedback, and be very personal. As the exhibit illustrates, face-to-face conversation scores highest in channel richness because it transmits the most information per communication episode, using multiple information cues such as words, postures, facial expressions, gestures, intonations, immediate feedback (both verbal and nonverbal), and the personal touch of being present.
Others are lean in that they score low on these factors. Impersonal written media such as formal reports and bulletins rate lowest in richness.
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Channel Richness and Choice of Communication Channel (2 of 4)
The choice of channel depends on whether the message is routine.
Routine messages tend to be straightforward and have a minimum of ambiguity.
Choose oral communication when you need to gauge the receiver’s receptivity.
Written communication is more reliable for complex and lengthy communications.

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The choice of one channel over another depends on whether the message is routine.
Routine messages tend to be straightforward and have a minimum of ambiguity. Nonroutine messages tend to be complicated and have the potential for misunderstanding. Routine messages can efficiently be communicated through channels that are lower in richness. However, nonroutine messages can effectively be communicated only by selecting rich channels.
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Channel Richness and Choice of Communication Channel (3 of 4)
Know you audience and use good grammar.
Letters
Text messaging
Social media
Blogging

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Letters are used in business primarily for networking purposes and when signatures need to be authentic.
In general, respond to instant messages only when they are professional, and initiate them only when you know they will be welcome.
There are significant gains and challenges from the introduction of text messaging in business settings. Texts are cheap to send and receive, and the willingness to be available for quick communications from clients and managers is conducive to good business. However, some users view text messaging as intrusive and distracting. Many organizations are also concerned about the security of texting. It is best to severely limit personal text messages during work hours and be cautious about using texting for business purposes.
On the corporate level, the returns on using social media are mixed. If you want to use social media for business purposes as a manager, make certain you are connected with all levels of management engaged in the effort. Use discretion about which social media platforms are acceptable for business communications. Make sure you know your company’s social media policies about corporate confidentiality and your company’s view on your privacy.
As an individual, you may choose to post a blog to your own blog page, or you may choose to comment on another person’s blog. If someone in the company happens to read a critical or negative blog entry or post, there is nothing to keep him or her from sharing that information with others.
It’s important to be alert to nonverbal aspects of communication and look for nonverbal cues as well as the literal meaning of a sender’s words.
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Channel Richness and Choice of Communication Channel (4 of 4)
Information Security
Electronic information
Physical information
Information that employees know
Most companies monitor employee Internet use and e-mail records, and some use video surveillance and record phone conversations

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Security is a huge concern for nearly all organizations with private or proprietary information about clients, customers, and employees. Organizations worry about the security of the electronic information they seek to protect, such as hospital patient data, the physical information they still keep in file cabinets, and the security of the information they entrust their employees with knowing, such as Apple’s need-to-know-only information sharing.
Most companies actively monitor employee Internet use and e-mail records, and some even use video surveillance and record phone conversations. Necessary though they may be, such practices can seem invasive to employees. An organization can relieve employee concerns by engaging them in the creation of information-security policies and giving them some control over how their personal information is used.
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Persuasive Communication (1 of 2)
Automatic processing: a relatively superficial consideration of evidence and information.
It takes little time and low effort, but it lets us be easily fooled by a variety of tricks, like a cute jingle or glamorous photo.
Controlled processing: a detailed consideration of evidence and information relying on facts, figures, and logic.
Requires effort and energy, but it’s harder to fool someone who engages in it.

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To understand the process of communication, it is useful to consider two relatively different ways that we process information. First, we’ll discuss automatic processing.
We often rely on automatic processing, a relatively superficial consideration of evidence and information making use of heuristics like those we discussed in Chapter 6. Automatic processing takes little time and low effort, so it makes sense to use it for processing persuasive messages related to topics you don’t care much about. The disadvantage is that it lets us be easily fooled by a variety of tricks, like a cute jingle or glamorous photo.
So what is controlled processing? Suppose you’re looking for a place to live. You do independent research among experts who know something about the subject, gather information about prices from a variety of sources, and consider the costs and benefits of renting versus buying. This is called controlled processing: a detailed consideration of evidence and information relying on facts, figures, and logic. Controlled processing requires effort and energy, but it’s harder to fool someone who has taken the time and effort to engage in it.
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Persuasive Communication (2 of 2)
Rules of thumb for determining the choice of processing:
Interest level
Prior knowledge
Personality
Need for cognition
Message characteristics
Match your message to your audience

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There are a few rules of thumb for determining what types of processing an audience will use.
One of the best predictors of whether people will use an automatic or controlled process for reacting to a persuasive message is their level of interest in it. When people are very interested in the outcome of a decision, they’re more likely to process information carefully.
People who are very well informed about a subject area are also more likely to use controlled processing strategies. On the other hand, people who are poorly informed about a topic can change their minds more readily, even in the face of fairly superficial arguments presented without a great deal of evidence.
People who require many facts before making a decision have a high need for cognition, a personality trait of individuals who are most likely to be persuaded by evidence and facts.
Another factor that influences whether people use an automatic or controlled processing strategy is the characteristics of the message itself. Messages provided through relatively lean communication channels, with little opportunity for users to interact with the content of the message, tend to encourage automatic processing. Conversely, messages provided through richer communication channels, like a long magazine article, tend to encourage more deliberative processing.
The most important implication of all this research is to match your persuasive message to the type of processing your audience is likely to use. For example, when the audience is not especially interested in a persuasive message topic, when they are poorly informed, when they are low in need for cognition, and when information is transmitted through relatively lean channels, they’ll be more likely to use automatic processing. In these cases, use messages that are more emotion-laden and associate positive images with your preferred outcome. On the other hand, when the audience is interested in a topic, when they are high in need for cognition, or when the information is transmitted through rich channels, then it is a better idea to focus on rational arguments and evidence to make your case.
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Identify Common Barriers to Effective Communication
Barriers to Effective Communication
Filtering
Selective perception
Information overload
Emotions
Language
Silence
Communication apprehension
Lying

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There are many barriers to effective communication.
Filtering refers to a sender’s purposely manipulating information so it will be seen as more favorable by the receiver. For example, telling the boss what she wants to hear. The more levels in an organization’s structure, the more opportunities there are for filtering.
Selective perception describes how receivers selectively see and hear based on their needs, motivations, experience, background, and other personal characteristics. Receivers project their interests and expectations into communications as they decode them.
Information overload occurs when the information we have to work with exceeds our processing capacity. The result is the tendency to select out, ignore, pass over, or forget information. Or put it aside until the overload situation is over. The result is lost information and less effective communication.
Emotions also influence how people receive messages. People in negative moods are more likely to scrutinize messages in greater detail, whereas those in positive moods tend to accept communications at face value. Extreme emotions such as jubilation or depression are most likely to hinder effective communication.
Message senders tend to incorrectly assume the words and terms they use mean the same to the receiver as to them, but even when we’re communicating in the same language, words mean different things to different people. Age and context are two of the biggest factors that influence such differences.
It’s easy to ignore silence or lack of communication because it is defined by the absence of information. However, research suggests using silence and withholding communication are common and problematic. Silence is less likely where minority opinions are treated with respect, work-group identification is high, and high procedural justice prevails.
An estimated 5 to 20% of the population suffers from communication apprehension. They experience undue tension or anxiety in oral and/or written communication. They may find it difficult to talk with others face-to-face or on the telephone. Studies show those who are oral-communication apprehensive avoid situations for which oral communication is a dominant requirement. Managers should be aware of the impact of communication apprehension on job performance.
The final barrier to effective communication is outright misrepresentation of information, or lying. The problem is, there are no nonverbal or verbal cues unique to lying—averting your gaze, pausing, and shifting your posture can also be signals of nervousness, shyness, or doubt. In sum, the frequency of lying and the difficulty in detecting liars makes this an especially strong barrier to effective communication in organizations.
64

Overcoming Problems in Cross-Cultural Communication (1 of 3)
Cultural Barriers
Caused by semantics – words mean different things to different people.
Caused by word connotations – words imply different things in different languages.
Caused by tone differences.
Caused by differences in tolerance for conflict and methods for resolving conflicts.

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Cross-cultural barriers increases the potential for communications problems.
First, there are barriers caused by semantics: words mean different things to different people. Some words do not translate between cultures. For example, English terms such as efficiency, free market, and regulation are not directly translatable into Russian.
Second, there are barriers caused by word connotations: words imply different things in different languages. For example, the Japanese word ok. means “yes,” but may mean “yes, I’m listening,” not “yes, I agree.”
Third, there are barriers caused by tone differences. In some cultures, language is formal; in others, it is informal. The tone changes depending on the context.
Fourth, there are cultural differences in tolerance for conflict and methods for resolving conflicts. Individuals from individualist cultures tend to be more comfortable with direct conflicts and will make the source of their disagreements overt. Collectivists are more likely to acknowledge conflict only implicitly and avoid emotionally charged disputes. They may attribute conflicts to the situation more than to the individuals and therefore may not require explicit apologies to repair relationships, whereas individualists prefer explicit statements accepting responsibility for conflicts and public apologies to restore relationships.
65

Overcoming Problems in Cross-Cultural Communication (2 of 3)
Exhibit 12-8 High- versus Low-Context Cultures from

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Cultures tend to differ in the importance to which context influences meaning, which is illustrated here in Exhibit 11-8.
Countries such as China, Korea, Japan, and Vietnam, are high-context cultures. They rely heavily on nonverbal and subtle situational cues when communicating with others. What is not said may be more significant than what is said. A person’s official status, place in society, and reputation carry considerable weight and public apologies to restore relationships.
People from Europe and North America reflect their low-context cultures. They rely essentially on words to convey meaning. Body language or formal titles are secondary to spoken and written words.
66

Overcoming Problems in Cross-Cultural Communication (3 of 3)
A Cultural Guide
Know yourself.
Foster a climate of mutual respect, fairness, and democracy.
State facts, not your interpretation.
Consider the other person’s viewpoint.
Proactively maintain the identity of the group.

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When communicating with people from a different culture, what can you do to reduce misinterpretations? Fred Casmir, a leading expert in intercultural communication research, and other experts offer the following suggestions:
Know yourself.
Foster a climate of mutual respect, fairness, and democracy.
State facts, not your interpretation.
Consider the other person’s viewpoint.
Proactively maintain the identity of the group.
67

Implications for Managers (1 of 2)
Remember that your communication mode will partly determine your communication effectiveness.
Obtain feedback from your employees to make certain your messages—however they are communicated—are understood.
Remember that written communication creates more misunderstandings than oral communication; communicate with employees through in-person meetings when possible.

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You’ve probably discovered the link between communication and employee satisfaction in this chapter: the less uncertainty, the greater the satisfaction. Distortions, ambiguities, and incongruities between verbal and nonverbal messages all increase uncertainty and reduce satisfaction.
Specific implications for managers are:
Remember that your communication mode will partly determine your communication effectiveness.
Obtain feedback from your employees to make certain your messages—however they are communicated—are understood.
Remember that written communication creates more misunderstandings than oral communication; communicate with employees through in-person meetings when possible.
68

Implications for Managers (2 of 2)
Make sure you use communication strategies appropriate to your audience and the type of message you’re sending.
Keep in mind communication barriers such as gender and culture.

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Finally, managers should:
Make sure you use communication strategies appropriate to your audience and the type of message you’re sending.
Keep in mind communication barriers such as gender and culture.
69

Learning Objectives (2 of 2)
12.6 Identify common barriers to effective communication.
12.7 Discuss how to overcome the potential problems of cross-cultural communication.

Questions?

Organizational Behavior

Eighteenth Edition, Global Edition

Chapter 13

Leadership

Learning Objectives (1 of 2)
13.1 Summarize the conclusions of trait theories of leadership.
13.2 Identify the central tenets and main limitations of behavioral theories.
13.3 Contrast contingency theories of leadership.
13.4 Describe the contemporary theories of leadership and their relationship to foundational theories.

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After studying this chapter, you should be able to:
Summarize the conclusions of trait theories of leadership.
Identify the central tenets and main limitations of behavioral theories.
Contrast contingency theories of leadership.
Describe the contemporary theories of leadership and their relationship to foundational theories.
2

Learning Objectives (2 of 2)
13.5 Discuss the roles of leaders in creating ethical organizations.
13.6 Describe how leaders can have a positive impact on their organizations through building trust and mentoring.
13.7 Identify the challenges to our understanding of leadership.

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Additional objectives for this chapter.
Discuss the roles of leaders in creating ethical organizations.
Describe how leaders can have a positive impact on their organizations through building trust and mentoring.
Identify the challenges to our understanding of leadership.
3

Summarize the Conclusions of Trait Theories of Leadership (1 of 6)
Leadership is the ability to influence a group toward the achievement of a vision or set of goals.
Not all leaders are managers, nor are all managers leaders.
Nonsanctioned leadership is often as important or more important than formal influence.

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Leadership is the ability to influence a group toward the achievement of a vision or set of goals. The source of this influence may be formal, such as that provided by managerial rank in an organization. But not all leaders are managers, nor, for that matter, are all managers leaders. Just because an organization provides its managers with certain formal rights is no assurance they will lead effectively.
Nonsanctioned leadership—the ability to influence that arises outside the formal structure of the organization—is often as important or more important than formal influence. In other words, leaders can emerge from within a group as well as by formal appointment.
4

Summarize the Conclusions of Trait Theories of Leadership (2 of 6)
Trait theories of leadership focus on personal qualities and characteristics.
The search for personality, social, physical, or intellectual attributes that differentiate leaders from non-leaders goes back to the earliest stages of leadership research.

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Trait theories of leadership focus on personal qualities and characteristics. The search for personality, social, physical, or intellectual attributes that differentiate leaders from non-leaders goes back to the earliest stages of leadership research.

Summarize the Conclusions of Trait Theories of Leadership (3 of 6)
A comprehensive review of the leadership literature, when organized around the Big Five, has found extraversion to be the most predictive trait of effective leaders, but it is more strongly related to the way leaders emerge than to their effectiveness.
Unlike agreeableness and emotional stability, conscientiousness and openness to experience also showed strong relationships to leadership, though not quite as strong as extraversion.

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A comprehensive review of the leadership literature, when organized around the Big Five, has found extraversion to be the most important trait of effective leaders, but it is more strongly related to the way leaders emerge than to their effectiveness.
Sociable and dominant people are more likely to assert themselves in group situations, but leaders need to make sure they’re not too assertive—one study found leaders who scored very high on assertiveness were less effective than those who were moderately high.
Unlike agreeableness and emotional stability, conscientiousness and openness to experience also showed strong relationships to leadership, though not quite as strong as extraversion.
6

Summarize the Conclusions of Trait Theories of Leadership (4 of 6)
Good leaders who like being around people:
Are able to assert themselves (extraverted).
Are disciplined and able to keep commitments they make (conscientious).
Have an apparent advantage when it comes to leadership.

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The trait approach does have something to offer. Leaders who like being around people and are able to assert themselves (extraverted), who are disciplined and able to keep commitments they make (conscientious), do have an apparent advantage when it comes to leadership, suggesting good leaders do have key traits in common. One reason is that conscientiousness and extraversion are positively related to leaders’ self-efficacy, which explained most of the variance in subordinates’ ratings of leader performance. People are more likely to follow someone who is confident she’s going in the right direction.
7

Summarize the Conclusions of Trait Theories of Leadership (5 of 6)
Another trait that may indicate effective leadership is emotional intelligence.
A core component of EI is empathy.
People high in EI are more likely to emerge as leaders, even after taking cognitive ability and personality into account.

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Another trait that may indicate effective leadership is emotional intelligence (EI), discussed in Chapter 4. A core component of EI is empathy. A leader who effectively displays and manages emotions will find it easier to influence the feelings of followers, by both expressing genuine sympathy and enthusiasm for good performance and by using irritation for those who fail to perform.
Recent research has demonstrated that people high in EI are more likely to emerge as leaders, even after taking cognitive ability and personality into account.
8

Summarize the Conclusions of Trait Theories of Leadership (6 of 6)
Two conclusions:
Traits can predict leadership.
Traits do a better job predicting the emergence of leaders than they do at distinguishing between effective and ineffective leaders.

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Based on the latest findings, we offer two conclusions. We can say that traits can predict leadership. Second, traits do a better job predicting the emergence of leaders and the appearance of leadership than they do at distinguishing between effective and ineffective leaders. The fact that an individual exhibits the traits and that others consider him or her a leader does not necessarily mean that he or she will be an effective one.

Trait theories help us predict leadership, but they don’t fully help us explain leadership.
9

Central Tenets and Main Limitations of Behavioral Theories (1 of 3)
Behavioral theories of leadership imply we can train people to be leaders.
Ohio State Studies found two behaviors that accounted for most leadership behavior:
Initiating structure
Consideration

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While trait research provides a basis for selecting the right people for leadership, behavioral theories of leadership imply that we can train people to be leaders.
The most comprehensive theories resulted from the Ohio State Studies which sought to identify independent dimensions of leader behavior. Beginning with more than a thousand dimensions, the studies narrowed the list to two that substantially accounted for most of the leadership behavior described by employees: initiating structure and consideration.
Initiating structure is the extent to which a leader defines and structures his or her role and those of subordinates to facilitate goal attainment. It includes behavior that attempts to organize work, work relationships, and goals. A leader high in initiating structure is someone who “assigns group members to particular tasks,” “expects workers to maintain definite standards of performance,” and “emphasizes the meeting of deadlines.”
Consideration is the extent to which a leader has job relationships that are characterized by mutual trust, respect for employees’ ideas, and regard for their feelings. A leader high in consideration helps employees with personal problems, is friendly and approachable, treats all employees as equals, and expresses appreciation and support.
10

Central Tenets and Main Limitations of Behavioral Theories (2 of 3)
The GLOBE study suggests there are international differences in preference for initiating structure and consideration.
Found that leaders high in consideration would succeed best in where cultures did not favor unilateral decision making.

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Some research from the GLOBE study suggests that there are international differences in preference for initiating structure and consideration. Research found that leaders high in consideration would succeed best in countries where cultural values did not favor unilateral decision making, such as Brazil. In contrast, the French have a more bureaucratic view of leaders and are less likely to expect them to be humane and considerate. A leader high in initiating structure (relatively task-oriented) will do best there and can make decisions in a relatively autocratic manner. In other cultures, both dimensions may therefore be important.
11

Central Tenets and Main Limitations of Behavioral Theories (3 of 3)
Summary of Trait Theories and Behavioral Theories
Leaders who have certain traits and who display culturally appropriate consideration and structuring behaviors do appear to be more effective.
Traits and behaviors do not guarantee success.
Context matters too.

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In summary, leaders who have certain traits and who display culturally appropriate consideration and structuring behaviors do appear to be more effective. Future research is needed to integrate these approaches. As important as traits and behaviors are in identifying effective or ineffective leaders, they do not guarantee success. The context matters too.
12

Contrast Contingency Theories of Leadership (1 of 7)
The Fiedler contingency model: effective group performance depends upon the proper match between the leader’s style of interacting with subordinates and the degree to which the situation gives control to the leader.
The least preferred coworker (LPC) questionnaire:
Task- or relationship-oriented.
Assumes leadership style is fixed.

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The first comprehensive contingency model for leadership was developed by Fred Fiedler, who proposed that effective group performance depends on the proper match between the leader’s style of interacting with subordinates and the degree to which the situation gives control to the leader.
The first step in the Fiedler contingency model is identifying leadership style. Fiedler believed that a key factor in leadership success is the individual’s basic leadership style. He created the least preferred coworker (LPC) questionnaire for this purpose, to measure whether a person is task- or relationship-oriented.
13

Contrast Contingency Theories of Leadership (2 of 7)
Defining the Situation
Contingency dimensions:
Leader-member relations
Task structure
Position power

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After assessing leadership style, it is necessary to match the leader with the situation. Fiedler has identified three contingency or situational dimensions:
Leader–member relations—the degree of confidence, trust, and respect members have in their leader.
Task structure—the degree to which the job assignments are procedural.
Position power—the degree of influence a leader has over power variables such as hiring, firing, discipline, promotions, and salary increases.
The next step is to evaluate the situation in terms of these three contingency variables. Leader–member relations are either good or poor. Task structure is either high or low. Position power is either strong or weak. Fiedler states the better the leader–member relations, the more highly structured the job, and the stronger the position power, the more control the leader has.
14

Contrast Contingency Theories of Leadership (3 of 7)
Exhibit 13-1 Findings from the Fiedler Model

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As shown in Exhibit 12-1, Fiedler concluded that task-oriented leaders tend to perform better in situations that were very favorable to them as well as in situations that were very unfavorable. Fiedler would predict that when faced with a category I, II, Ill, VII, or VIII situation, task-oriented leaders perform better. Relationship-oriented leaders, however, perform better in moderately favorable situations—categories IV through VI. Fiedler has condensed these eight situations to three.
15

Contrast Contingency Theories of Leadership (4 of 7)
Situational leadership theory (SLT) is a contingency theory that focuses on the followers.
Successful leadership is achieved by selecting the right leadership style, which is contingent on the level of the followers’ readiness.

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Although LPC theory is the most researched contingency theory, three others deserve mention.
First, situational leadership theory (SLT) is a contingency theory that focuses on the followers. It proposes that successful leadership is achieved by selecting the right leadership style, which is contingent on the level of the followers’ readiness. The term readiness refers to the extent to which people have the ability and willingness to accomplish a specific task. A leader should choose one of four behaviors depending on follower readiness. If followers are unable and unwilling to do a task, the leader needs to give clear and specific directions; If they are unable but willing, the leader needs to display high task orientation to compensate for followers’ lack of ability and high relationship orientation to get them to “buy into” the leader’s desires. Conversely, if followers are able but unwilling, the leader needs to use a supportive and participative style. If they are both able and willing, the leader doesn’t need to do much.
SLT has intuitive appeal. Yet, research efforts to test and support the theory have generally been disappointing.
16

Contrast Contingency Theories of Leadership (5 of 7)
Path-goal theory:
Contingency model of leadership that extracts key elements from the Ohio State leadership research on initiating structure and consideration and the expectancy theory of motivation.
Derived from belief that effective leaders clarify the path to help followers achieve work goals.

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One of the most respected approaches to leadership is the path-goal theory, developed by Robert House. It is a contingency model of leadership that extracts key elements from the Ohio State leadership research on initiating structure and consideration and the expectancy theory of motivation.
The term “path-goal” is derived from the belief that effective leaders clarify the path to help their followers achieve their work goals. According to path-goal theory, whether a leader should be directive or supportive or should demonstrate some other behavior depends on complex analysis of the situation. The theory predicts the following: directive leadership yields greater satisfaction when tasks are ambiguous or stressful than when they are highly structured and well laid out, while supportive leadership results in high performance and satisfaction when employees are performing structured tasks. Directive leadership is likely to be perceived as redundant among employees with high ability or considerable experience.
17

Contrast Contingency Theories of Leadership (6 of 7)
The leader-participation model relates leadership behavior and participation in decision making.
Leader behavior must adjust to reflect the task structure.

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The final contingency theory is the leader-participation model which argues that the way the leader makes decisions is as important as what she or he decides. The model, developed by Victor Vroom and Phillip Yetton, relates leadership behavior and participation in decision-making. Like path-goal theory, it says leader behavior must adjust to reflect the task structure.
18

Contrast Contingency Theories of Leadership (7 of 7)
OB POLL How Are You Developing Your Leadership Skills
Note: Survey of 700 respondents.
Source: Based on J. Brox, “The Results Are In: How Do You Ensure You’re Constantly Developing as a Leader?” May 14, 2013, http://www.refreshleadership.com/index.php/2013/05/results-ensure-youre-constantly-developing-leader/#more-4732.

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Consider the OB Poll … and your own quest for leadership skills.
19

Contemporary Theories of Leadership (1 of 12)
Exhibit 13-2 Leader–Member Exchange Theory from

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The leader-member exchange (LMX) theory argues that because of time pressures, leaders establish a special relationship with a small group of their followers (see Exhibit 12-2). These individuals make up the in-group—they are trusted, get a disproportionate amount of the leader’s attention, and are more likely to receive special privileges. The theory proposes that early in the history of the interaction between a leader and a given follower, the leader implicitly categorizes the follower as an “in” or an “out” and that relationship is relatively stable over time. The leader does the choosing on the basis of the follower’s characteristics.
Research to test LMX theory has been generally supportive, with substantive evidence that leaders do differentiate among followers. These disparities are far from random; and followers with in-group status will have higher performance ratings, engage in more helping or “citizenship” behaviors at work, engage in less deviant or “counterproductive” behaviors at work, and report greater satisfaction with their superior.
20

Contemporary Theories of Leadership (2 of 12)
Exhibit 13-3 Key Characteristics of a Charismatic Leader
1. Vision and articulation. Has a vision—expressed as an idealized goal—that proposes a future better than the status quo; able to clarify the importance of the vision in terms that are understandable to others.
2. Personal risk. Willing to take on high personal risk, incur high costs, and engage in self-sacrifice to achieve the vision.
3. Sensitivity to follower needs. Perceptive of others’ abilities and responsive to their needs and feelings.
4. Unconventional behavior. Engages in behaviors that are perceived as novel and counter to norms.

Source: Based on J. A. Conger and R. N. Kanungo, Charismatic Leadership in Organizations (Thousand Oaks, CA: Sage, 1998), 94.

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Charismatic leadership theory was proposed by Robert House, stating that followers make attributes of heroic or extraordinary leadership abilities when they observe certain behaviors, as seen in Exhibit 12-3. General characteristics are: they have vision; they are willing to take personal risk; they are sensitive to followers’ needs; and they exhibit extraordinary behaviors.
21

Contemporary Theories of Leadership (3 of 12)
Are Charismatic Leaders Born or Made?
Some individuals are born with charismatic traits, others are trained to exhibit charismatic behaviors.
Develop the aura of charisma.
Use your passion to generate enthusiasm.
Speak in an animated voice, reinforce your message with eye contact and facial expressions, and gesture for emphasis.
Bring out the potential in followers by tapping into their emotions and create a bond that inspires them.

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Are charismatic leaders born or made? Some individuals are born with traits that make them charismatic. Most experts believe individuals can also be trained to exhibit charismatic behavior.
To further develop an aura of charisma, use your passion as a catalyst for generating enthusiasm. Speak in an animated voice, reinforce your message with eye contact and facial expressions, and gesture for emphasis. Bring out the potential in followers by tapping into their emotions, and create a bond that inspires them. Remember, enthusiasm is contagious!
22

Contemporary Theories of Leadership (4 of 12)
How Charismatic Leaders Influence Followers
Articulating an appealing vision.
Developing a vision statement.
Establishing a new set of values.
Conveying courage and conviction about the vision.

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How does a charismatic leader influence followers? By articulating an appealing vision, developing an accompanying vision statement, conveying a new set of values, and demonstrating courage and conviction about the vision. Followers “catch” the emotions their leader is conveying.
23

Contemporary Theories of Leadership (5 of 12)
Does Effective Charismatic Leadership Depend on the Situation?
People are especially receptive when they sense a crisis or when they are under stress.

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Does effective charismatic leadership depend on the situation? Charisma appears to be most appropriate when the follower’s task has an ideological component or when the environment involves a high degree of stress and uncertainty. People are especially receptive when they sense a crisis or when they are under stress.
This may explain why, when charismatic leaders surface, it’s more likely to be in politics, religion, wartime; or when a business firm is in its infancy or facing a life-threatening crisis.
24

Contemporary Theories of Leadership (6 of 12)
The Dark Side of Charismatic Leadership
Many leaders don’t necessarily act in the best interest of their companies.
Many have allowed their personal goals to override the goals of the organization.
Individuals who are narcissistic are also higher in some behaviors associated with charismatic leadership.

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Some charismatic leaders don’t necessarily act in the best interest of their companies, allowing their personal goals to override the goals of the organization. The results at companies such as Enron, Tyco, WorldCom, and HealthSouth are examples of leaders who recklessly used organizational resources for their personal benefit and executives who violated laws and ethical boundaries to inflate stock prices, allowing leaders to cash in millions of dollars in stock options.
It’s little wonder research has shown that individuals who are narcissistic are also higher in some behaviors associated with charismatic leadership. It’s not that charismatic leadership isn’t effective; overall, it is. But a charismatic leader isn’t always the answer. Success depends, to some extent, on the situation and on the leader’s vision.
25

Contemporary Theories of Leadership (7 of 12)
Exhibit 13-4 Characteristics of Transactional and Transformational Leaders
Transactional Leader
Contingent Reward: Contracts exchange of rewards for effort, promises rewards for good performance, recognizes accomplishments.
Management by Exception (active): Watches and searches for deviations from rules and standards, takes corrective action.
Management by Exception (passive): Intervenes only if standards are not met.
Laissez-Faire: Abdicates responsibilities, avoids making decisions.
Transformational Leader
Idealized Influence: Provides vision and sense of mission, instills pride, gains respect and trust.
Inspirational Motivation: Communicates high expectations, uses symbols to focus efforts, expresses important purposes in simple ways.
Intellectual Stimulation: Promotes intelligence, rationality, and careful problem solving.
Individualized Consideration: Gives personal attention, treats each employee individually, coaches, advises.

Sources: Based on B. M. Bass, Leadership and Performance Beyond Expectations (New York, NY: Free Press, 1990); and T. A. Judge and R. F. Piccolo, “Transformational and Transactional Leadership: A Meta-Analytic Test of Their Relative Validity,” Journal of Applied Psychology 89, no. 5 (2004): 755–68.

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A stream of research has focused on differentiating between transactional leaders and transformational leaders.
Transactional leaders guide or motivate their followers in the direction of established goals by clarifying role and task requirements.
Transformational leaders inspire followers to transcend their own self-interests for the good of the organization. They change followers’ awareness of issues by helping them to look at old problems in new ways; and they are able to excite, arouse, and inspire followers to put out extra effort to achieve group goals.
Exhibit 12-4 shows that transformational leadership builds on transactional leadership and produces levels of follower effort and performance beyond what transactional leadership alone can do. Transactional and transformational leadership complement each other; they aren’t opposing approaches to getting things done. The best leaders are transactional and transformational.
26

Contemporary Theories of Leadership (8 of 12)
Exhibit 13-5 Full Range of Leadership Model

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Exhibit 12-5 shows the full range of the leadership model.
Laissez-faire is the most passive and least effective type, while management by exception is slightly better. Contingent reward leadership can be effective, but will not get employees to go above and beyond the call of duty.
The remaining four correspond to transformational leadership: individualized consideration, intellectual stimulation, inspirational motivation, and idealized influence. Leaders are generally more effective when they regularly use the four I’s. Only with these styles are leaders able to motivate followers to perform above expectations and transcend their self-interests for the sake of the organization.
27

Contemporary Theories of Leadership (9 of 12)
How Transformational Leadership Works
Creativity – theirs and others.
Decentralization of responsibility.
Propensity to take risks.
Compensation is geared toward long-term results.
Greater agreement among top managers about the organization’s goals.

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Overall, most research suggests that the reason transformational leadership works is that it inspires and motivates followers. For example, research in Germany and Switzerland found that transformational leadership improves employee job satisfaction, self-efficacy, and commitment to the leader by fulfilling follower autonomy, competence, and relatedness needs (see self-determination theory, Chapter 7)
One study found that transformational leadership leads to increased job performance and OCB by empowering employees (see Chapter 3), especially in more “organic” organizations (i.e., organizations that are adaptive and that have fluid roles, shared values, and reciprocal communication). Other research in China found that transformational leadership positively influenced workers’ helping behaviors through improving employee trust in their leaders along with prosocial motivation. Finally, multiple studies in Israel and the United Kingdom suggest that transformational leadership can improve workplace safety by increasing intrinsic motivation and prevention focus (see Chapter 7).
Companies with transformational leaders also show greater agreement among top managers about the organization’s goals, which yields superior organizational performance.
The Israeli military has seen similar results, showing that transformational leaders improve performance by building consensus among group members. Transformational leaders are able to increase follower self-efficacy, giving the group a “can do” spirit.
28

Contemporary Theories of Leadership (10 of 12)
Evaluation of Transformational Leadership
Transformational leadership has been supported at diverse job levels and occupations, but it isn’t effective in all situations.
It has a greater impact on the bottom line in smaller, privately-held firms than in more complex organizations.

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Transformational leadership has been supported at diverse job levels and occupations (school principals, teachers, marine commanders, ministers, presidents of MBA associations, military cadets, union shop stewards, sales reps), but it isn’t equally effective in all situations.
Transformational leadership has a greater impact on the bottom line in smaller, privately held firms than in more complex organizations. Transformational leadership may also be more effective when leaders can directly interact with the workforce to make decisions (when they have high task autonomy) than when they report to an external board of directors or deal with a complex bureaucratic structure.
29

Contemporary Theories of Leadership (11 of 12)
Transformational versus Transactional Leadership
Transformational leadership is more strongly correlated with a variety of workplace outcomes.

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When comparing transformational leadership with transactional leadership, research indicates transformational leadership is more strongly correlated than transactional leadership a variety of workplace outcomes.
However, transformational leadership theory is not perfect. The full range of leadership model shows a clear division between transactional and transformational leadership that may not fully exist in effective leadership.
And contrary to the full range of leadership model, the four I’s of transformational leadership are not always superior in effectiveness to transactional leadership; contingent reward leadership, in which leaders dole out rewards as certain goals are reached by employees, sometimes works as well as transformational leadership.
More research is needed, but the general supportable conclusion is that transformational leadership is desirable and effective, given the right application.
30

Contemporary Theories of Leadership (12 of 12)
Transformational versus Charismatic Leadership
Charismatic leadership places more emphasis on the way leaders communicate – are they passionate and dynamic?
Transformational leadership focuses more on what they are communicating – is it a compelling vision?
Both focus on the leader’s ability to inspire followers.

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Charismatic leadership places somewhat more emphasis on the way leaders communicate (are they passionate and dynamic?), while transformational leadership focuses more on what they are communicating (is it a compelling vision?).
Still, the theories are more alike than different. At their heart, both focus on the leader’s ability to inspire followers, and sometimes they do so in the same way. Because of this, some researchers believe the concepts are somewhat interchangeable.
31

Role of Leaders in Creating Ethical Organizations (1 of 4)
Authentic Leadership
Authentic leaders:
Know who they are.
Know what they believe in and value.
Act on those values and beliefs openly and candidly.
The result: people come to have faith in them.

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What is authentic leadership? Authentic leaders know who they are. They know what they believe in and value. And they act on those values and beliefs openly and candidly. The result: people come to have faith in them.
Recent research indicates that authentic leadership, especially when shared among top management team members, created a positive energizing effect that heightened firm performance.
Not only is authenticity important for leaders, it is important for followers, too. In a study of Belgian service companies, the joint authenticity of both leaders and followers led to the satisfaction of basic needs (see self-determination theory, Chapter 7), which in turn led to improvements in performance.86 Much like the group- and individual-focused transformational leadership findings from the previous section, both group- and individual perceptions of authenticity on follower outcomes.
32

Role of Leaders in Creating Ethical Organizations (2 of 4)
Ethical Leadership
Ethics touches on leadership at a number of junctures.
Efforts have been made to combine ethical and charismatic leadership into an idea of socialized charismatic leadership – leadership that conveys other-centered values by leaders who model ethical conduct.

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Ethics touches on leadership at a number of junctures. Leaders who treat their followers with fairness, especially by providing honest, frequent, and accurate information, are seen as more effective.
Leaders must be willing to express their ethical beliefs and persuade others to follow their standards. To convey their beliefs, leaders should learn to express their moral convictions in statements that reflect values shared with their organization’s members. Leaders need to set high ethical standards, demonstrate them through their own behavior, and encourage and reward integrity in others while avoiding abuses of power.
Leaders rated as highly ethical tend to be very positively evaluated by their subordinates, who are also more satisfied and committed to their jobs as well as experience less strain and turnover intentions.
Efforts have been made by scholars to combine ethical and charismatic leadership into an idea of socialized charismatic leadership – leadership that conveys other-centered (not self-centered) values by leaders who model ethical conduct.
33

Role of Leaders in Creating Ethical Organizations (3 of 4)
Abusive Supervision
Refers to the perception that a supervisor is hostile in their verbal and nonverbal behavior.
Negatively affects health, leads to increased depression, emotional exhaustion, and job tension perceptions.
Leads to decreases in organizational commitment, job satisfaction, and perceived organizational support along with increased work-family conflict.
Can adversely affect employee performance and other employee behaviors.

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It can happen to anyone—we’re all capable of being abusive as managers.103 Frighteningly, some research suggests that when it does occur it can be costly: current estimates suggest that it costs organizations in the United States about 23.8 billion dollars per year.
The United States also has relatively low reported levels of abusive supervision in recent research—the highest ratings of abusive supervision are actually in the eastern hemisphere, including China, the Philippines, and Taiwan; with lower ratings in the United States, Canada, and India.
Although not a form of leadership in all cases, abusive supervision refers to the perception that a supervisor is hostile in their verbal and nonverbal behavior.
Research suggests that there are a variety of dire consequences for abusive supervision. First and foremost, abusive supervision negatively affects health: it leads to increased depression, emotional exhaustion, and job tension perceptions. Second, it also leads to decreases in organizational commitment, job satisfaction, and perceived organizational support along with increased work-family conflict. Finally, it can adversely affect employee performance and other employee behaviors: victims of abusive supervision are more prone to engage in CWBs and other deviant behaviors (especially retaliatory ones directed toward their supervisors) and less prone to engage in OCBs.
34

Role of Leaders in Creating Ethical Organizations (4 of 4)
Servant Leadership
Servant leaders go beyond their self-interest and instead focus on opportunities to help followers grow and develop.
Characteristic behaviors include listening, empathizing, persuading, accepting stewardship, and actively developing followers’ potential.

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Scholars have recently considered ethical leadership from a new angle by examining servant leadership. Because servant leadership focuses on serving the needs of others, research has focused on its outcomes for the well-being of followers.
Characteristic behaviors include listening, empathizing, persuading, accepting stewardship, and actively developing followers’ potential.
What are the effects of servant leadership? One study of 71 general managers of restaurants in the United States and over 1,000 of their employees found that servant leaders tend to create a culture of service (see Chapter 16), which in turn, improves the restaurant performance and enhances employee attitudes and performance by increasing their identification with the restaurant. Second, there is a relationship between servant leadership and follower OCB that appears to be stronger when followers are encouraged to focus on being dutiful and responsible. Third, servant leadership increases team potency (a belief that one’s team has above-average skills and abilities), which in turn leads to higher levels of group performance. Finally, a study with a nationally representative sample found higher levels of citizenship associated with a focus on growth and advancement, which in turn was associated with higher levels of creative performance.
Servant leadership may be more prevalent and more effective in certain cultures. When asked to draw images of leaders, U.S. subjects tend to draw them in front of the group, giving orders to followers. Singaporeans tend to draw leaders at the back of the group, acting more to gather a group’s opinions together and then unify them from the rear. This suggests the East Asian prototype is more like a servant leader, which might mean servant leadership is more effective in these cultures.
35

Positive Leadership (1 of 4)
Trust and Leadership
Trust: a psychological state that exists when you agree to make yourself vulnerable to another because you have positive expectations about how things are going to turn out.
A primary attribute associated with leadership.
When trust is broken, it can have serious adverse effects on a group’s performance.

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Trust is a psychological state that exists when you agree to make yourself vulnerable to another because you have positive expectations about how things are going to turn out. Trust is a primary attribute associated with leadership. When trust is broken, it can have serious adverse effects on a group’s performance. People are unlikely to look up to or follow someone they perceive as dishonest or likely to take advantage of them. Thus, as you might expect, transformational leaders do generate higher levels of trust from their followers, which in turn is related to higher levels of team confidence and, ultimately, higher levels of team performance.
36

Positive Leadership (2 of 4)
Exhibit 13-6 The Nature of Trust

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Trust isn’t just about the leader; the characteristics of the followers will also influence the development of trust. What key characteristics lead us to believe a leader is trustworthy? Exhibit 12-6 shows three characteristics: integrity, benevolence, and ability.
Integrity refers to honesty and truthfulness. It seems the most critical of the three in assessing another’s trustworthiness. Benevolence means the trusted person has your interests at heart, even if yours aren’t necessarily in line with theirs. Ability encompasses an individual’s technical and interpersonal knowledge and skills.
The Outcomes of Trust:
Trust encourages taking risks.
Whenever employees decide to deviate from the usual way of doing things, or to take their supervisors’ word on a new direction, they are taking a risk.
Trust facilitates information sharing.
One big reason employees fail to express concerns at work is that they don’t feel psychologically safe revealing their views.
Trusting groups are more effective.
When a leader sets a trusting tone in a group, members are more willing to help each other and exert extra effort, which further increases trust.
Trust enhances productivity.
The bottom-line interest of companies also appears positively influenced by trust. Employees who trust their supervisors tend to receive higher performance ratings.
37

Positive Leadership (3 of 4)
Trust propensity
Trust and Culture
The Role of Time
Regaining Trust

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Trust propensity refers to how likely a particular employee is to trust a leader. Some people are simply more likely to believe others can be trusted. Trust may be built on very different perceptions from culture to culture.
Time is the final ingredient in the recipe for trust. Trust doesn’t happen immediately: we come to trust people based on observing their behavior over a period of time. Trust can also be won in the ability domain simply by demonstrating competence.
Leaders who break the psychological contract with workers, demonstrating they aren’t trustworthy, will find that employees are less satisfied and less committed, have higher intentions to turnover, engage in less citizenship behavior, and have lower task performance.
38

Positive Leadership (4 of 4)
Exhibit 13-7 Career and Psychological Functions of the Mentoring Relationship
Career Functions Psychosocial Functions
Lobbying to get the protégé challenging and visible assignments Counseling the protégé to bolster his or her self-confidence
Coaching the protégé to help develop his or her skills and achieve work objectives Sharing personal experiences with the protégé
Providing exposure to influential individuals within the organization Providing friendship and acceptance
Protecting the protégé from possible risks to his or her reputation Acting as a role model
Sponsoring the protégé by nominating him or her for potential advances or promotions Blank
Acting as a sounding board for ideas the protégé might be hesitant to share with a direct supervisor Blank

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A mentor is a senior employee who sponsors and supports a less-experienced employee (a protégé). Successful mentors are good teachers. They present ideas clearly, listen well, and empathize with protégés’ problems. As shown in Exhibit 12-7, mentoring relationships serve both career functions and psychosocial functions.
Traditional informal mentoring relationships develop when leaders identify a less experienced, lower-level employee who appears to have potential for future development. The protégé will often be tested with a particularly challenging assignment. If he or she performs acceptably, the mentor will develop the relationship, informally showing the protégé how the organization really works outside its formal structures and procedures.
Why would a leader want to be a mentor? Many feel they have something to share with the younger generation and want to provide a legacy. Mentoring also provides unfiltered access to the attitudes of lower-ranking employees, and protégés can be an excellent source of early warning signals that identify potential organizational problems.
You might assume mentoring is valuable for objective outcomes like compensation and job performance, but research suggests the gains are primarily psychological. So, while mentoring can have an impact on career success, research shows that it’s not as important as ability and personality.
39

Challenges to our Understanding of Leadership (1 of 4)
Much of an organization’s success or failure is due to factors outside the influence of leadership.
In many cases, success or failure is just a matter of being in the right or wrong place at a given time.
The attribution theory of leadership says leadership is merely an attribution people make about other individuals.

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Much of an organization’s success or failure is due to factors outside the influence of leadership. In many cases, success or failure is just a matter of being in the right or wrong place at a given time.
The attribution theory of leadership says leadership is merely an attribution people make about other individuals. Thus, we attribute to leaders intelligence, outgoing personality, strong verbal skills, aggressiveness, understanding, and industriousness. At the organizational level, we tend to see leaders, rightly or wrongly, as responsible for extremely negative or extremely positive performance.
40

Challenges to our Understanding of Leadership (2 of 4)
Exhibit 13-8 Substitutes for and Neutralizers of Leadership
Defining Characteristics Relationship-Oriented Leadership Task-Oriented Leadership
Individual Blank Blank
Experience/training No effect on Substitutes for
Professionalism Substitutes for Substitutes for
Indifference to rewards Neutralizes Neutralizes
Job Blank Blank
Highly structured task No effect on Substitutes for
Provides its own feedback No effect on Substitutes for
Intrinsically satisfying Substitutes for Neutralizes
Organization Blank Blank
Explicit formalized goals No effect on Substitutes for
Rigid rules and procedures No effect on Substitutes for
Cohesive work groups Substitutes for Substitutes for

Source: Based on K. B. Lowe and W. L. Gardner, “Ten Years of the Leadership Quarterly: Contributions and Challenges for the Future,” Leadership Quarterly 11, no. 4 (2000): 459–514.

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Data from numerous studies collectively demonstrate that, in many situations, whatever actions leaders exhibit are irrelevant.
As shown here in Exhibit 12-8, experience and training are among the substitutes that can replace the need for a leader’s support or ability to create structure. Organizational characteristics such as explicit formalized goals, rigid rules and procedures, and cohesive work groups can also replace formal leadership, while indifference to organizational rewards can neutralize its effects. Neutralizers make it impossible for leader behavior to make any difference to follower outcomes. Sometimes the difference between substitutes and neutralizers is fuzzy.
41

Challenges to our Understanding of Leadership (3 of 4)
Selecting Leaders
Identifying effective leaders:
Review specific requirements for the position.
Consider personality tests to identify leadership traits.
Situation-specific experience is relevant.
Plan for a change in leadership.

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The process that organizations go through to fill management positions is essentially an exercise in trying to identify individuals who will be effective leaders. You might begin by reviewing the specific requirements for the position such as knowledge, skills, and abilities that are needed to do the job effectively. Personality tests can identify traits associated with leadership—extraversion, conscientiousness, and openness to experience. Also, candidates with high emotional intelligence should have an advantage, especially in situations requiring transformational leadership. Experience is a poor predictor of leader effectiveness, but situation-specific experience is relevant.
In addition, it’s important to plan for a change in leadership.
42

Challenges to our Understanding of Leadership (4 of 4)
Training Leaders
Leadership training is likely to be more successful with high self-monitors.
Teach implementation skills.
Teach trust building, mentoring, and situational-analysis.
Behavioral training through modeling exercises can increase an individual’s charismatic leadership qualities.
Review leadership after key organizational events.
Train in transformational leadership skills.

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Billions are spent on leadership training and development every year. Here are some things management can do to get the maximum effect from their leadership-training budgets:
Leadership training is likely to be more successful with individuals who are high self-monitors than with low self-monitors. Second, organizations can teach implementation skills. We also can teach skills such as trust building, mentoring, and situational-analysis skills. There is evidence suggesting that behavioral training through modeling exercises can increase an individual’s ability to exhibit charismatic leadership qualities. Recent research also indicates that leaders should engage in regularly reviewing their leadership after key organizational events as part of their development. Finally, leaders can be trained in transformational leadership skills that have bottom-line results.
43

Implications for Managers (1 of 2)
For maximum leadership effectiveness, ensure that your preferences on the initiating structure and consideration dimensions are a match for your work dynamics and culture.
Hire candidates who exhibit transformational leadership qualities and who have demonstrated success in working through others to meet a long-term vision. Personality tests can reveal candidates higher in extraversion, conscientiousness, and openness, which may indicate leadership readiness.

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In summary, leadership plays a central part in understanding group behavior, because it’s the leader who usually directs us toward our goals. Knowing what makes a good leader should thus be valuable in improving group performance. The early search for a set of universal leadership traits failed. However, recent efforts using the Big Five personality framework show strong and consistent relationships between leadership and extraversion, conscientiousness, and openness to experience. The behavioral approach’s major contribution was narrowing leadership into task-oriented (initiating structure) and people-oriented (consideration) styles. By considering the situation in which the leader operates, contingency theories promised to improve on the behavioral approach, but only LPC theory has fared well in leadership research. Research on charismatic and transformational leadership has made major contributions to our understanding of leadership effectiveness.
Specific implications for managers are below:
For maximum leadership effectiveness, ensure that your preferences on the initiating structure and consideration dimensions are a match for your work dynamics and culture.
Hire candidates who exhibit transformational leadership qualities and who have demonstrated success in working through others to meet a long-term vision. Personality tests can reveal candidates higher in extraversion, conscientiousness, and openness, which may indicate leadership readiness.
44

Implications for Managers (2 of 2)
Hire candidates whom you believe are ethical and trustworthy for management roles and train current managers in your organization’s ethical standards to increase leadership effectiveness and reduce abusive supervision.
Seek to develop trusting relationships with followers, because, as organizations have become less stable and predictable, strong bonds of trust are replacing bureaucratic rules in defining expectations and relationships.
Consider investing in leadership training such as formal courses, workshops, and mentoring.

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Hire candidates whom you believe are ethical and trustworthy for management roles and train current managers in your organization’s ethical standards to increase leadership effectiveness and reduce abusive supervision.
Seek to develop trusting relationships with followers, because, as organizations have become less stable and predictable, strong bonds of trust are replacing bureaucratic rules in defining expectations and relationships.
Consider investing in leadership training such as formal courses, workshops, rotating job responsibilities, coaching, and mentoring.
45

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Learning Objectives (1 of 2)
13.1 Summarize the conclusions of trait theories of leadership.
13.2 Identify the central tenets and main limitations of behavioral theories.
13.3 Contrast contingency theories of leadership.
13.4 Describe the contemporary theories of leadership and their relationship to foundational theories.

Questions?

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Organizational Behavior
Eighteenth Edition, Global Edition
Chapter 14
Foundations of Organization Structure
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Learning Objectives
14.1 Identify seven elements of an organization’s structure.
14.2 Identify the characteristics of the functional structure, the bureaucracy, and the matrix structure.
14.3 Identify the characteristics of the virtual structure, the team structure, and the circular structure.
14.4 Describe the effects of downsizing on organizational structures and employees.
14.5 Contrast the reasons for using mechanistic versus organic structural models.
14.6 Analyze the behavioral implications of different organizational designs.

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After studying this chapter, you should be able to:
Identify seven elements of an organization’s structure.
Identify the characteristics of the functional structure, the bureaucracy, and the matrix structure.
Identify the characteristics of the virtual structure, the team structure, and the circular structure.
Describe the effects of downsizing on organizational structures and employees.
Contrast the reasons for using mechanistic versus organic structural models.
Analyze the behavioral implications of different organizational designs.
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Identify Seven Elements of an Organization’s Structure (1 of 10)
Exhibit 14-1 Key Design Questions and Answers for Designing the Proper Organizational Structure
The Key Question The Answer Is Provided by
1. To what degree are activities subdivided into separate jobs? Work specialization
2. On what basis will jobs be grouped together? Departmentalization
3. To whom do individuals and groups report? Chain of command
4. How many individuals can a manager efficiently and effectively direct? Span of control
5. Where does decision-making authority lie? Centralization and decentralization
6. To what degree will there be rules and regulations to direct employees and managers? Formalization
7. Do individuals from different areas need to regularly interact? Boundary spanning

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An organizational structure defines how job tasks are formally divided, grouped, and coordinated. There are six key elements, shown here in Exhibit 15-1. They are work specialization, departmentalization, chain of command, span of control, centralization and decentralization, and formalization.
52

Identify Seven Elements of an Organization’s Structure (2 of 10)
Work specialization: the division of labor into separate activities.
Repetition of work.
Training for specialization.
Increasing efficiency through invention.
Henry Ford

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Let’s focus on the first of the elements, work specialization. Work specialization, or division of labor, describes the degree to which activities in the organization are subdivided into separate jobs. In essence, an entire job is broken into a number of steps, each completed by a separate individual.
By the late 1940s, most manufacturing jobs in industrialized countries were being done this way. Management saw this as a means to make the most efficient use of its employees’ skills. Managers also looked for other efficiencies that could be achieved through work specialization. For example, employee skills at performing a task successfully increase through repetition. Training for specialization is more efficient from the organization’s perspective. It increases efficiency and productivity, encouraging the creation of special inventions and machinery. For much of the first half of this century, managers viewed work specialization as an unending source of increased productivity.
Henry Ford became rich and famous by building automobiles on an assembly line, demonstrating that work can be performed more efficiently by using a work specialization strategy. Every Ford worker was assigned a specific, repetitive task. By breaking jobs up into small standardized tasks, Ford was able to produce cars at the rate of one every ten seconds, while using employees who had relatively limited skills.
53

Identify Seven Elements of an Organization’s Structure (3 of 10)
Exhibit 14-2 Economies and Diseconomies of Work Specialization

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The fourth element in an organization’s structure is span of control. How many employees a manager can efficiently and effectively direct is an important question. All things being equal, the wider or larger the span, the more efficient the organization.
Exhibit 15-3 illustrates that reducing the number of managers leads to significant savings. Wider spans are more efficient in terms of cost. However, at some point, wider spans reduce effectiveness. Narrow or small spans have their advocates. By keeping the span of control to five or six employees, a manager can maintain close control. Narrow spans have three major drawbacks. First, as already described, they are expensive because they add levels of management. Second, they make vertical communication in the organization more complex. Third, narrow spans of control encourage overly tight supervision and discourage employee autonomy.
The trend in recent years has been toward wider spans of control. They are consistent with recent efforts by companies to reduce costs, cut overhead, speed up decision making, increase flexibility, get closer to customers, and empower employees. To ensure that performance does not suffer because of these wider spans, organizations have been investing heavily in employee training.
54

Identify Seven Elements of an Organization’s Structure (4 of 10)
Grouping jobs together so common tasks can be coordinated is called departmentalization.
By functions performed.
By type of product or service the organization produces.
By geography or territory.
By process differences.
By type of customer.

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The second element in an organization’s structure is departmentalization, or grouping jobs together so common tasks can be coordinated. One of the most popular ways to group activities is by functions performed. For example, a manufacturing manager might organize his or her plant by separating engineering, accounting, manufacturing, personnel, and purchasing specialists into common departments. The advantage to this type of grouping is obtaining efficiencies from putting like specialists together.
Tasks can also be departmentalized by the type of product or service the organization produces. The major advantage to this type of grouping is increased accountability for product performance under a single manager. Another way to departmentalize is on the basis of geography or territory. The sales function, for instance, may have western, southern, mid-western, and eastern regions.
Process departmentalization can be used for processing customers as well as products. For example, at the state motor vehicles office you might find: validation by motor vehicles division, processing by the licensing department, and payment collection by the treasury department.
A final category of departmentalization is by type of customer. Microsoft, for instance, recently reorganized around four customer markets: consumers, large corporations, software developers, and small businesses. The assumption is that customers in each department have a common set of problems and needs that can best be met by having specialists for each.
55

Identify Seven Elements of an Organization’s Structure (5 of 10)
Chain of command: an unbroken line of authority that extends from the top of the organization to the lowest echelon and clarifies who reports to whom.
Once a basic cornerstone in organization design.
Two complementary concepts:
Unity of command
Authority

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The third element in the organization’s structure is the chain of command. The chain of command is an unbroken line of authority that extends from the top of the organization to the lowest echelon and clarifies who reports to whom. It was once a basic cornerstone in the design of organizations, but it is far less important today. Two complementary concepts are authority and unity of command. Authority is the rights inherent to management to give orders and expect the orders to be obeyed. The principle of unity of command helps preserve the concept of an unbroken line of authority. It states that a person should have only one superior to whom he/she is directly responsible.
56

Identify Seven Elements of an Organization’s Structure (6 of 10)
The chain of command is less relevant today because of technology and the trend of empowering people.
Operating employees make decisions once reserved for management.
Increased popularity of self-managed and cross-functional teams.
Many organizations still find that enforcing the chain of command is productive.

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Times change, and so do the basic tenets of organizational design. The concepts of chain of command have less relevance today because of technology and the trend of empowering employees. A low-level employee today can access information in seconds that a generation ago was available only to top managers. Operating employees are empowered to make decisions previously reserved for management.
Add the popularity of self-managed and cross-functional teams, and the creation of new structural designs that include multiple bosses, and you can see why authority and unity of command hold less relevance. Still, many organizations find they can be most productive by enforcing the chain of command. Indeed, one survey of more than 1,000 managers found that 59% of them agreed with the statement, “There is an imaginary line in my company’s organizational chart. Strategy is created by people above this line, while strategy is executed by people below the line.” However, this same survey found that buy-in to the organization’s strategy by lower-level employees was inhibited by too much reliance on hierarchy for decision making.
57

Identify Seven Elements of an Organization’s Structure (7 of 10)
Exhibit 14-3 Contrasting Spans of Control

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Now that you’re familiar with the elements in an organization’s structure, let talk about the more common organizational designs: the simple structure, the bureaucracy, and the matrix.
Exhibit 15-4 shows an example of the simple structure, an organization design that is characterized most by what it is not rather than what it is: it is not elaborate. It has a low degree of departmentalization, wide spans of control, authority centralized in a single person, and little formalization. The simple structure is a “flat” organization; it usually has only two or three vertical levels. One individual has the decision-making authority.
58

Identify Seven Elements of an Organization’s Structure (8 of 10)
Centralization and Decentralization
Centralization refers to the degree to which decision making is concentrated at a single point in the organization.
Advantages of a decentralized organization:
Can act more quickly to solve problems.
More people provide input into decisions.
Employees are less likely to feel alienated from those who make decisions that affect their work lives.

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The next element is centralization and decentralization. Centralization refers to the degree to which decision making is concentrated at a single point in the organization. In centralized organizations, top managers make all the decisions, and lower-level managers merely carry out their directives. In organizations at the other extreme, decentralized decision making is pushed down to the managers closest to the action.
The concept of centralization includes only formal authority—that is, the rights inherent in a position. An organization characterized by centralization is inherently different structurally from one that’s decentralized. A decentralized organization can act more quickly to solve problems, more people provide input into decisions, and employees are less likely to feel alienated from those who make decisions that affect their work lives.
Management efforts to make organizations more flexible and responsive have produced a recent trend toward decentralized decision making by lower-level managers, who are closer to the action and typically have more detailed knowledge about problems than top managers. When Procter & Gamble empowered small groups of employees to make many decisions about new-product development independent of the usual hierarchy, it was able to rapidly increase the proportion of new products ready for market.
Research investigating a large number of Finnish organizations demonstrates that companies with decentralized research and development offices in multiple locations were better at producing innovation than companies that centralized all research and development in a single office.
59

Identify Seven Elements of an Organization’s Structure (9 of 10)
Formalization: the degree to which jobs within the organization are standardized.
A highly formalized job means a minimum amount of discretion.
Low formalization – job behaviors are relatively non-programmed, and employees have a great deal of freedom to exercise discretion in their work.

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The final element in the model is formalization, or the degree to which jobs within the organization are standardized. A highly formalized job gives the job incumbent a minimum amount of discretion over what is to be done, when it is to be done, and how he or she should do it. Employees can be expected to always handle the same input in exactly the same way. The greater the standardization, the less input the employee has into how the job is done. Low formalization, where job behaviors are relatively non-programmed, allows employees to have a great deal of freedom to exercise discretion in their work. The degree of formalization can vary widely between organizations and within organizations.
60

Identify Seven Elements of an Organization’s Structure (10 of 10)
Boundary spanning occurs when individuals form relationships with people outside their formally assigned groups.
Positive results are especially strong in organizations that encourage extensive internal communication; in other words, external boundary spanning is most effective when it is followed up with internal boundary spanning.

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We’ve described ways that organizations create well-defined task structures and chains of authority.
These systems facilitate control and coordination for specific tasks, but if there is too much division within an organization, attempts to coordinate across groups can be disastrous.
One way to overcome compartmentalization and retain the positive elements of structure is to encourage or create boundary-spanning roles.
Within a single organization, boundary spanning occurs when individuals form relationships with people outside their formally assigned groups. Boundary-spanning activities occur not only within but also between organizations.
Positive results are especially strong in organizations that encourage extensive internal communication; in other words, external boundary spanning is most effective when it is followed up with internal boundary spanning.
Organizations can use formal mechanisms to facilitate boundary-spanning activities. One method is to assign formal liaison roles or develop committees of individuals from different areas of the organization. Development activities can also facilitate boundary spanning. Employees with experience in multiple functions, such as accounting and marketing, are more likely to engage in boundary spanning. Many organizations try to set the stage for these sorts of positive relationships by creating job rotation programs so new hires get a better sense of different areas of the organization. A final method to encourage boundary spanning is to bring attention to overall organizational goals and shared identity concepts.
61

Common Organizational Frameworks and Structures (1 of 7)
Exhibit 14-4 A Simple Structure (Jack Gold’s Men’s Store)

Common Organizational Frameworks and Structures (2 of 7)
Simple structure: the manager and the owner are one and the same.
Strengths:
Simple, fast, and flexible.
Inexpensive to maintain.
Accountability is clear.
Weaknesses:
Difficult to maintain in anything other than small organizations.
Risky—everything depends on one person.

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The simple structure is most widely practiced in small businesses in which the manager and the owner are one and the same.
The strength of the simple structure lies in its simplicity. It is fast, flexible, inexpensive to maintain, and accountability is clear. One major weakness is that it is difficult to maintain in anything other than small organizations. It becomes increasingly inadequate as an organization grows because its low formalization and high centralization tend to create information overload at the top. As size increases, it is very difficult for the owner-manager to make all the choices. The simple structure’s other weakness is that it is risky—everything depends on one person. Illness can literately destroy the information and decision-making center of the company.
63

Common Organizational Frameworks and Structures (3 of 7)
A bureaucracy is characterized by standardization.
Highly routine operating tasks.
Very formalized rules and regulations.
Tasks grouped into functional departments.
Centralized authority.
Narrow spans of control.
Decision making that follows the chain of command.

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In contrast, standardization is the key concept for all bureaucracies. The bureaucracy is characterized by six traits: highly routine operating tasks achieved through specialization; very formalized rules and regulations; tasks grouped into functional departments; a strong centralized authority; there are narrow spans of control; and decision making follows the chain of command.
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Common Organizational Frameworks and Structures (4 of 7)
Strengths of bureaucracy:
Ability to perform standardized activities in a highly efficient manner.
Weaknesses of bureaucracy:
Subunit conflicts.
Unit goals dominate.
Obsessive behavior.
Covering weak management.

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The bureaucracy’s primary strength is in its ability to perform standardized activities in a highly efficient manner. Putting like specialties together in functional departments results in economies of scale, minimum duplication of personnel and equipment, etc. Bureaucracies get by nicely with less talented and less costly middle- and lower-level managers.
Some of bureaucracy’s weaknesses are that specialization creates subunit conflicts, and functional unit goals can override the organization’s goals. Also, an obsessive concern with following the rules can develop, and the bureaucracy is efficient only as long as employees confront familiar problems with programmed decision rules.
65

Common Organizational Frameworks and Structures (5 of 7)
Two aspects of bureaucracies:
Functional structure: groups employees by their similar specialties, roles, or tasks.
Divisional structure: groups employees into units by product, service, customer, or geographical market area.

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There are two aspects of bureaucracies we should explore: functional and divisional structures.
The functional structure groups employees by their similar specialties, roles, or tasks. An organization organized into production, marketing, HR and accounting departments is an example. Many large organizations utilize this structure, although this is evolving to allow for quick changes in response to business opportunities. Still, there are advantages, including that the functional structure allows specialists to become experts more easily than if they worked in diversified units. Employees can also be motivated by a clear career path to the top of the organization chart specific to their specialties.
The divisional structure groups employees into units by product, service, customer, or geographical market area. It is highly departmentalized. Sometimes this structure is known by the type of division structure it uses: product/service organizational structure (like units for cat food, dog food, and bird food that report to an animal food producer), customer organizational structure (like units for outpatient care, inpatient care, and pharmacy that report to hospital administration), or geographic organizational structure (like units for Europe, Asia, and South America that report to corporate headquarters).
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Common Organizational Frameworks and Structures (6 of 7)
The matrix structure combines two forms of departmentalization—functional and product:
The strength of functional is putting specialists together.
Product departmentalization facilitates coordination.
It provides clear responsibility for all activities related to a product, but with duplication of activities and costs.

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The third organization design is the matrix structure. This structure is common in advertising agencies, aerospace firms, research and development laboratories, construction companies, hospitals, government agencies, universities, management consulting firms, and entertainment companies. It combines two forms of departmentalization—functional and product.
The strength of functional departmentalization is putting like specialists together and the pooling and sharing of specialized resources across products. Its major disadvantage is the difficulty of coordinating tasks. Product departmentalization facilitates coordination. It provides clear responsibility for all activities related to a product, but with duplication of activities and costs.
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Common Organizational Frameworks and Structures (7 of 7)
Exhibit 14-5 Matrix Structure for a College of Business Administration

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The most obvious structural characteristic of the matrix is that it breaks the unity of command concept. Exhibit 15-5 shows the matrix form as used in a college of business administration. Its strength is its ability to facilitate coordination when the organization has a multiplicity of complex and interdependent activities. The dual lines of authority reduce tendencies of departmental members to protect their worlds. It facilitates the efficient allocation of specialists.
The major disadvantages of the matrix lie in the confusion it creates, its propensity to foster power struggles, and the stress it places on individuals. Violation of the unity of command concept increases ambiguity that often leads to conflict. Confusion and ambiguity also create the seeds of power struggles. Reporting to more than one boss introduces role conflict, and unclear expectations introduce role ambiguity.
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Alternate Design Options (1 of 4)
The Virtual Organization
The essence of the virtual organization is that it is typically a small, core organization that outsources major business functions.
Also referred to as a modular or network organization.
It is highly centralized, with little or no departmentalization.

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The essence of the virtual organization is that it is typically a small, core organization that outsources major business functions. The virtual organization is also referred to as a modular or network organization. It’s highly centralized, with little or no departmentalization.
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Alternate Design Options (2 of 4)
Exhibit 14-6 A Virtual Structure

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Exhibit 15-6 shows a virtual organization in which management outsources all of the primary functions of the business. The dotted lines in this exhibit represent those relationships typically maintained under contracts. Managers in virtual structures spend most of their time coordinating and controlling external relations, typically by way of computer-network links.
Network organizations often take many forms. Some of the more “traditional” forms include the franchise form in which there are managers, systems, and other experts in the central node (i.e., executive group) whereas customer sales and services are carried out by franchise units. This popular form of network organization is very common in service business models, such as 7-Eleven, McDonald’s, Jimmy John’s, and Dunkin’ Donuts. However, in this form, franchisees do not tend to collaborate or coordinate with one another, and may actually be in direct competition for resources from the executive group. Another example is the starburst form in which a “parent” firm splits off one of its functions into a “spinoff” firm. For example, in 2012 Netflix split off its DVD function into its own separate entity, now DVD.com.
The major advantage to the virtual organization is its flexibility. The primary drawback is that it reduces management’s control over key parts of its business. Virtual organizations’ drawbacks have become increasingly clear as their popularity has grown. They are in a state of perpetual flux and reorganization, which means roles, goals, and responsibilities are unclear, setting the stage for political behavior. Cultural alignment and shared goals can be lost because of the low degree of interaction among members. Team members who are geographically dispersed and communicate infrequently find it difficult to share information and knowledge, which can limit innovation and slow response time.
Ironically, some virtual organizations are less adaptable and innovative than those with well-established communication and collaboration networks. A leadership presence that reinforces the organization’s purpose and facilitates communication is thus especially valuable.
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Alternate Design Options (3 of 4)
The team structure: eliminates the chain of command and replaces departments with empowered teams.
Removes vertical and horizontal boundaries.
Breaks down external barriers.
Flattens the hierarchy and minimizes status and rank.
When fully operational, the team structure may break down geographic barriers.

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The team structure seeks to eliminate the chain of command and replace departments with empowered teams. This structure removes vertical and horizontal boundaries in addition to breaking down external barriers between the company and its customers and suppliers. By removing vertical boundaries, management flattens the hierarchy and minimizes status and rank.
Cross-hierarchical teams (which include top executives, middle managers, supervisors, and operative employees), participative decision-making practices, and the use of 360-degree performance appraisals (in which peers and others evaluate performance) can be used. When fully operational, the team structure may break down geographic barriers.
Today, most large U.S. companies see themselves as team-oriented global corporations; many, such as Coca-Cola and McDonald’s, do as much business overseas as in the United States, and some struggle to incorporate geographic regions into their structure.
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Alternate Design Options (4 of 4)
In the circular structure: in the center are the executives, and radiating outward in rings grouped by function are the managers, then the specialists, then the workers.
Has intuitive appeal for creative entrepreneur.
However, employees may be unclear about whom they report to and who is running the show.
We are still likely to see the popularity of the circular structure spread.

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Picture the concentric rings of an archery target. In the center are the executives, and radiating outward in rings grouped by function are the managers, then the specialists, then the workers. This is the circular structure.
The circular structure has intuitive appeal for creative entrepreneurs, and some small innovative firms have claimed it. However, as in many of the current hybrid approaches, employees are apt to be unclear about whom they report to and who is running the show.
We are still likely to see the popularity of the circular structure spread. The concept may have intuitive appeal for spreading a vision of corporate social responsibility (CSR) initiatives, for instance.
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Effects of Downsizing on Organizations and Employees (1 of 2)
The Leaner Organization: Downsizing
The goal of the new organizational forms we’ve described is to improve agility by creating a lean, focused, and flexible organization.
Downsizing is a systematic effort to make an organization leaner by selling off business units, closing locations, or reducing staff.

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The leaner organization leads to organizational downsizing. The goal of the new organizational forms we’ve described is to improve agility by creating a lean, focused, and flexible organization. Downsizing is a systematic effort to make an organization leaner by selling off business units, closing locations, or reducing staff. It has been very controversial because of its potential negative impacts on employees.
The radical shrinking of Motorola Mobility in recent years was a case of downsizing due to loss of market share and changes in consumer demand. Some companies downsize to focus on their core competencies. Some companies focus on lean management techniques to reduce bureaucracy and speed up decision making.
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Effects of Downsizing on Organizations and Employees (2 of 2)
Strategies for downsizing include:
Investment
Communication
Participation
Assistance
Make cuts carefully and help employees through the process.

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There are several strategies for downsizing:
Investment. Companies that downsize to focus on core competencies are more effective when they invest in high-involvement work practices afterward.
Communication. When employers make efforts to discuss downsizing with employees early, employees are less worried about the outcomes and feel the company is taking their perspective into account.
Participation. Employees worry less if they can participate in the process in some way. In some companies, voluntary early retirement programs or severance packages can help achieve leanness without layoffs.
Assistance. Providing severance, extended health-care benefits, and job search assistance demonstrates a company does really care about its employees and honors their contributions.
Companies that make themselves lean can be more agile, efficient, and productive—but only if they make cuts carefully and help employees through the process.
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Mechanistic vs. Organic Structural Models (1 of 8)
Exhibit 14-7 Mechanistic versus Organic Models

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We’ve described organizational designs ranging from the highly structured bureaucracy to the amorphous boundaryless organization. There are also two extreme models of organizational design, as seen here in Exhibit 15-7.
First, the mechanistic model is synonymous with bureaucracy and has extensive departmentalization, high formalization, a limited information network (mostly downward), and little participation in decision making. The organic model uses cross-hierarchical and cross-functional teams, low formalization, a comprehensive information network, and high participation in decision making.
Why are some organizations structured along mechanistic lines while others are organic? In this section, we present the major causes or determinants of an organization’s structure.
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Mechanistic vs. Organic Structural Models (2 of 8)
An organization’s structure is a means to help management achieve its objectives.
Most current strategy frameworks focus on three dimensions:
Innovation strategy
Cost Minimization strategy
Imitation strategy

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An organization’s structure is a means to help management achieve its objectives. Objectives derive from the organization’s overall strategy. Structure should follow strategy. Most current strategy frameworks focus on three strategy dimensions—innovation, cost minimization, and imitation—and the structural design that works best with each.
An innovation strategy means a strategy for meaningful and unique innovations. This strategy may appropriately characterize 3M Company. A cost-minimization strategy tightly controls costs, refrains from incurring unnecessary innovation or marketing expenses, and cuts prices in selling a basic product. This describes Walmart’s strategy. An imitation strategy tries to copy successful ideas of innovators and capitalize on the best of both in order to minimize risk and maximize opportunity for profit. It moves into new products or new markets only after viability has been proven by innovators, for example, when manufactures mass-market fashion goods that are rip-offs of designer styles.
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Mechanistic vs. Organic Structural Models (3 of 8)
Exhibit 14-8 The Strategy–Structure Relationship
Strategy Structural Option
Innovation Organic: A loose structure; low specialization, low formalization, decentralized
Cost minimization Mechanistic: Tight control; extensive work specialization, high formalization, high centralization
Imitation Mechanistic and organic: Mix of loose with tight properties; tight controls over current activities and looser controls for new undertakings

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Exhibit 15-8 describes the structural option that best matches each strategy. Innovators need the flexibility of the organic structure, whereas cost minimizers seek the efficiency and stability of the mechanistic structure. Imitators combine the two structures. They use a mechanistic structure to maintain tight controls and low costs in their current activities but create organic subunits in which to pursue new undertakings.
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Mechanistic vs. Organic Structural Models (4 of 8)
Organizational Size
Large organizations—employing 2,000 or more people—tend to have more specialization, more departmentalization, more vertical levels, and more rules and regulations than do small organizations.
The impact of size becomes less important as an organization expands.

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An organization’s size significantly affects its structure. Large organizations—employing 2,000 or more people—tend to have more specialization, more departmentalization, more vertical levels, and more rules and regulations than do small organizations. The impact of size becomes less important as an organization expands. Once an organization has around 2,000 employees, it’s already mechanistic. An additional 500 employees will not have much impact. However, adding 500 employees to a 300-employee firm is likely to result in a mechanistic structure.
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Mechanistic vs. Organic Structural Models (5 of 8)
Technology: the way an organization transfers its inputs into outputs.
Numerous studies have examined the technology-structure relationship.
Organizational structures adapt to their technology.

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Technology refers to how an organization transfers its inputs into outputs. Every organization has at least one technology for converting financial, human, and physical resources into products or services. Chinese electronics maker, Haier, uses an assembly-line process to make its products. Colleges may use a number of instruction technologies—the ever-popular formal lecture method, the case analysis method, the experiential exercise method, the programmed learning method, etc.—to educate its students.
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Mechanistic vs. Organic Structural Models (6 of 8)
An organization’s environment includes outside institutions or forces that can affect its performance.
Dynamic environments create significantly more uncertainty for managers than do static ones.
To minimize uncertainty:
Broaden structure to sense and respond to threats.
Form strategic alliances.

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An organization’s environment includes outside institutions or forces that can affect its performance, such as suppliers, customers, competitors, government regulatory agencies, and public pressure groups.
Dynamic environments create significantly more uncertainty for managers than do static ones. To minimize uncertainty, managers may broaden their structure to sense and respond to threats. For example, most companies, including Pepsi and Southwest Airlines, have added social networking departments to counter negative information posted on blogs. Or companies may form strategic alliances, such as when Microsoft and Yahoo! joined forces to better compete with Google.
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Mechanistic vs. Organic Structural Models (7 of 8)
Exhibit 14-9 Three-Dimensional Model of the Environment

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Any organization’s environment has three dimensions: capacity, volatility, and complexity. Capacity is the degree to which it can support growth. Rich and growing environments generate excess resources, which can buffer times of relative scarcity. Volatility refers to the degree of instability in an environment, characterized by a high degree of unpredictable change. The environment is dynamic, making it difficult for management to predict accurately the probabilities associated with various decision alternatives. At the other extreme is a stable environment. Complexity is the degree of heterogeneity and concentration among environmental elements. Simple environments are homogeneous and concentrated. In contrast, environments characterized by heterogeneity and dispersion are called complex.
Exhibit 15-9 summarizes our definition of the environment along its three dimensions. The arrows indicate movement toward higher uncertainty. Thus, organizations that operate in environments characterized as scarce, dynamic, and complex face the greatest degree of uncertainty because they have high unpredictability, little room for error, and a diverse set of elements in the environment to monitor constantly. Given this three-dimensional definition of environment, we can offer some general conclusions about environmental uncertainty and structural arrangements. The more scarce, dynamic, and complex the environment, the more organic a structure should be. The more abundant, stable, and simple the environment, the more the mechanistic structure will be preferred.
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Mechanistic vs. Organic Structural Models (8 of 8)
Another factor that shapes organizational structure is institutions.
Regulatory pressures.
Simple inertia.
Culture.
Fads or trends.
Institutional pressures are often difficult to see specifically because we take them for granted, but that doesn’t mean they aren’t powerful.

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Another factor that shapes organizational structure is institutions. These are cultural factors that act as guidelines for appropriate behavior. Institutional theory describes some of the forces that lead many organizations to have similar structures and, unlike the theories we’ve described so far, focuses on pressures that aren’t necessarily adaptive.
The most obvious institutional factors come from regulatory pressures; certain industries under government contracts, for instance, must have clear reporting relationships and strict information controls. Sometimes simple inertia determines an organizational form—companies can be structured in a particular way just because that’s the way things have always been done. Organizations in countries with high power distance might have a structural form with strict authority relationships because it’s seen as more legitimate in that culture. Some have attributed problems in adaptability in Japanese organizations to the institutional pressure to maintain authority relationships. Sometimes organizations start to have a particular structure because of fads or trends.
Many companies have recently tried to copy the organic form of a company like Google only to find that such structures are a very poor fit with their operating environment. Institutional pressures are often difficult to see specifically because we take them for granted, but that doesn’t mean they aren’t powerful.
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Analyze the Behavioral Implications of Different Organizational Designs (1 of 2)
An organization’s structure can have significant effects on its members.
It’s impossible to generalize!
Not everyone prefers the freedom and flexibility of organic structures.
Some people are most productive and satisfied when work tasks are standardized and ambiguity minimized.

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This chapter opened by implying that an organization’s structure can have significant effects on its members. A review of the evidence leads to a pretty clear conclusion: you can’t generalize! Not everyone prefers the freedom and flexibility of organic structures. Different factors stand out in different structures as well. In highly formalized, heavily structured, mechanistic organizations, the level of fairness in formal policies and procedures is a very important predictor of satisfaction. In more personal, individually adaptive, organic organizations, employees value interpersonal justice more. Some people are most productive and satisfied when work tasks are standardized and ambiguity minimized—that is, in mechanistic structures. So, any discussion of the effect of organizational design on employee behavior has to address individual differences.
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Analyze the Behavioral Implications of Different Organizational Designs (2 of 2)
Organizational Designs and Employee Behavior
Work specialization contributes to higher employee productivity.
No evidence supports a relationship between span of control and employee satisfaction or performance.
Fairly strong evidence links centralization and job satisfaction, meaning that less centralization is associated with higher satisfaction.
National culture influences the preference for structure.

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The evidence generally indicates that work specialization contributes to higher employee productivity—but at the price of reduced job satisfaction. However, work specialization is not an unending source of higher productivity.
While research fails to support a relationship between span of control and employee satisfaction or performance, we find fairly strong evidence linking centralization and job satisfaction. In general, less centralized organizations have a greater amount of autonomy, which appears positively related to job satisfaction.
Research suggests national culture influences the preference for structure. Organizations that operate with people from high-power-distance cultures, such as Greece, France, and most of Latin America, find their employees are much more accepting of mechanistic structures than are employees from low-power-distance countries. So consider cultural differences along with individual differences when predicting how structure will affect employee performance and satisfaction.
84

Implications for Managers (1 of 3)
Exhibit 14-10 Organizational Structure: Its Determinants and Outcomes from

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The theme of this chapter is that an organization’s internal structure contributes to explaining and predicting behavior. That is, in addition to individual and group factors, the structural relationships in which people work has a bearing on employee attitudes and behavior. What’s the basis for this argument? To the degree that an organization’s structure reduces ambiguity for employees and clarifies concerns, it shapes their attitudes and facilitates and motivates them to higher levels of performance. Exhibit 15-10 summarizes what we’ve discussed.
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Implications for Managers (2 of 3)
Specialization can make operations more efficient, but remember that excessive specialization can create dissatisfaction and reduced motivation.
Avoid designing rigid hierarchies that overly limit employees’ empowerment and autonomy.
Balance the advantages of remote work against the potential pitfalls before adding flexible workplace options into the organization’s structure.

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Managers should:
Recognize that specialization can make operations more efficient, but remember that excessive specialization can create dissatisfaction and reduced motivation.
Avoid designing rigid hierarchies that overly limit employees’ empowerment and autonomy.
Balance the advantages of remote work against the potential pitfalls before adding flexible workplace options into the organization’s structure.
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Implications for Managers (3 of 3)
Downsize your organization to realize major cost savings, and focus the company around core competencies – but only if necessary, because downsizing can have a significant negative impact on employee affect.
Consider the scarcity, dynamism, and complexity of the environment, and balance organic and mechanistic elements when designing an organizational structure.

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In addition, managers should:
Downsize your organization to realize major cost savings, and focus the company around core competencies, but only if necessary, because downsizing can have a significant negative impact on employee affect.
Consider the scarcity, dynamism, and complexity of the environment, and balance the organic and mechanistic elements when designing an organizational structure.
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Questions?

Organizational Behavior

Eighteenth Edition, Global Edition

Chapter 15

Organizational Culture

Learning Objectives
15.1 Describe the common characteristics of organizational culture.
15.2 Compare the functional and dysfunctional effects of organizational culture on people and the organization.
15.3 Identify the factors that create and sustain an organization’s culture.
15.4 Show how culture is transmitted to employees.
15.5 Describe the similarities and differences in creating an ethical culture, a positive culture, and a spiritual culture.
15.6 Show how national culture can affect the way organizational culture is transported to another country.

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After studying this chapter, you should be able to:
Describe the common characteristics of organizational culture.
Compare the functional and dysfunctional effects of organizational culture on people and the organization.
Identify the factors that create and sustain an organization’s culture.
Show how culture is transmitted to employees.
Describe the similarities and differences in creating an ethical culture, a positive culture, and a spiritual culture.
Show how national culture can affect the way organizational culture is transported to another country.
2

Common Characteristics of Organizational Culture (1 of 6)
A Definition of Organizational Culture
Organizational culture refers to a system of shared meaning held by members that distinguishes the organization from other organizations.

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Organizational culture refers to a system of shared meaning held by members that distinguishes the organization from other organizations.
3

Common Characteristics of Organizational Culture (2 of 6)
Primary characteristics that capture the essence of an organization’s culture:
Adaptability
Detail orientation
Results/Outcome orientation
People/Customer orientation
Collaboration/Team orientation
Integrity

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Six primary characteristics capture the essence of an organization’s culture. Each of the characteristics exists on a continuum from low to high. They are:
1. Adaptability. The degree to which employees are encouraged to be innovative and flexible as well as to take risks and experiment.
2. Detail orientation. The degree to which employees are expected to exhibit precision, analysis, and attention to detail.
3. Results/Outcome orientation. The degree to which management focuses on results or outcomes rather than on the techniques and processes used to achieve them.
4. People/Customer orientation. The degree to which management decisions take into consideration the effect of outcomes on people within and outside of the organization.
5. Collaboration/Team orientation. The degree to which work activities are organized around teams rather than individuals.
6. Integrity. The degree to which people exhibit integrity and high ethical standards in their work.
4

Common Characteristics of Organizational Culture (3 of 6)
Another common cultural framework groups organizations into:
The Clan
The Adhocracy
The Market
The Hierarchy

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Another common culture framework groups organizations into one of four types, each which has its own assumptions, beliefs, values, artifacts, and even criteria for effectiveness:3
1. “The Clan.” A culture which is based on human affiliation. Employees value attachment, collaboration, trust, and support.
2. “The Adhocracy.” A culture which is based on change. Employees value growth, variety, attention to detail, stimulation, and autonomy.
3. “The Market.” A culture which is based on achievement. Employees value communication, competence, and competition.
4. “The Hierarchy.” A culture which is based on stability. Employees value communication, formalization, and routine.
The differences between these cultures are reflected in their internal vs. external focus and their flexibility and stability.
5

Common Characteristics of Organizational Culture (4 of 6)
Culture as a Descriptive Term
Organizational culture is concerned with employees’ perceptions of the characteristics of the culture, not whether they like them.
Does it encourage teamwork?
Does it reward innovation?
Does it stifle initiative?
It differs from job satisfaction:
Job satisfaction is evaluative.
Organizational culture is descriptive.

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Organizational culture is concerned with employees’ perceptions of the characteristics of the culture, not whether they like them. Research has sought to measure how employees see their organization by asking questions like “Does it encourage teamwork? ,” “Does it reward innovation? ,” and “Does it stifle initiative?” Organizational culture differs from job satisfaction in that job satisfaction is evaluative while organizational culture is descriptive.
6

Common Characteristics of Organizational Culture (5 of 6)
Do Organizations Have Uniform Cultures?
Most organizations have a dominant culture and numerous sets of subcultures.
The dominant culture expresses the core values a majority of members share and that give the organization distinct personality.
Subcultures tend to develop in large organizations to reflect common problems, situations, or experiences that members face.

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Most organizations have a dominant culture and numerous sets of subcultures. The dominant culture expresses the core values that are shared by a majority of the organization’s members. Subcultures tend to develop in large organizations to reflect common problems, situations, or experiences that members face.
If organizations were composed only of numerous subcultures, organizational culture as an independent variable would be significantly less powerful. It is the “shared meaning” aspect of culture that makes it such a potent device for guiding and shaping behavior. That’s what allows us to say, for example, that the Zappos culture values customer care and dedication over speed and efficiency, and to use that information to better understand the behavior of Zappos’ executives and employees. But subcultures can influence members’ behavior too.
7

Common Characteristics of Organizational Culture (6 of 6)
Strong versus Weak Cultures
Strong culture: core values are intensely held and widely shared.
The more members who accept the core values and the greater their commitment, the stronger the culture and the greater its influence on member behavior.

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In a strong culture, core values are intensely held and widely shared. Moreover, the more members accept the core values, and the greater their commitment to those values, the stronger the culture is. The unanimity of purpose builds cohesiveness, loyalty, and organizational commitment, and in doing so, reduces employee turnover. High formalization creates predictability, orderliness, and consistency.
A strong culture should more directly affect organizational outcomes because it demonstrates high agreement about what the organization represents. Such unanimity of purpose builds cohesiveness, loyalty, meaning, and organizational commitment.
8

What Do Cultures Do? (1 of 9)
The Functions of Culture
Boundary-defining role.
Conveys a sense of identity for members.
Facilitates the generation of commitment.
Enhances the stability of the social system.
Serves as a sense-making and control mechanism.

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What role does culture perform? Cultures can be positive or negative for organizations. Culture is a boundary-defining role; it conveys a sense of identity for members; it facilitates the generation of commitment; it enhances the stability of the social system; and culture serves as a sense-making and control mechanism to guide and shape the attitudes and behavior of employees. In essence, culture defines the rules of the game.
9

What Do Cultures Do? (2 of 9)
Culture Creates Climate
Organizational climate is shared perceptions about the organization and work environment.
Team spirit at the organizational level.
Climates can interact with one another to produce behavior.
Climate also influences the habits people adopt.

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Organizational climate refers to the shared perceptions organizational members have about their organization and work environment. This aspect of culture is like team spirit at the organizational level. When everyone has the same general feelings about what’s important or how well things are working, the effect of these attitudes will be more than the sum of the individual parts. A positive overall workplace climate has been linked to higher customer satisfaction and financial performance.
Climates can interact with one another to produce behavior. For example, a positive climate for worker empowerment can lead to higher levels of performance in organizations that also have a climate for personal accountability.
Climate also influences the habits people adopt. If the climate for safety is positive, for example, everyone wears safety gear and follows safety procedures even if individually they wouldn’t normally think very often about being safe. Indeed, many studies have shown that a positive safety climate decreases the number of documented injuries on the job.
10

What Do Cultures Do? (3 of 9)
The Ethical Dimension of Culture
Organizational cultures are not neutral in their ethical orientation, even when they are not openly pursuing ethical goals.
Over time, the ethical culture, or the shared concept of right and wrong behavior in that workplace, develops as part of the organizational climate.
The ethical climate reflects the true values of the organization and shapes the ethical decision making of its members.

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Organizational cultures are not neutral in their ethical orientation, even when they are not openly pursuing ethical goals. Over time, the ethical culture, or the shared concept of right and wrong behavior in that workplace, develops as part of the organizational climate. The ethical climate reflects the true values of the organization and shapes the ethical decision making of its members.
11

What Do Cultures Do? (4 of 9)
Ethical climate theory (ECT) and the ethical climate index (ECI) categorize and measure the ethical dimensions of organizational cultures.
Five climate categories: instrumental, caring, independence, law and code, and rules.
Each explains the general mindset, expectations, and values of the managers and employees in relationship to their organization.
Ethical climate powerfully influences the way its individual members feel they should behave.

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Researchers have developed the ethical climate theory (ECT) and the ethical climate index (ECI) to categorize and measure the ethical dimensions of organizational cultures. Of the nine identified climate categories, five are found to be most prevalent in organizations: instrumental, caring, independence, law and code, and rules. Each explains the general mindset, expectations, and values of the managers and employees in relationship to their organization.
Organizations often progress through different categories as they move through their business life cycle.
An organization’s ethical climate powerfully influences the way its individual members feel they should behave, so much so that researchers have been able to predict organizational outcomes from the climate categories. Instrumental climates are negatively associated with employee job satisfaction and organizational commitment, even though those climates appeal to self-interest (of the employee and the company). They are positively associated with turnover intentions, workplace bullying, and deviant behavior. Caring and rules climates have a positive association with job satisfaction. Caring, independence, rules, and law and code climates also reduce employee turnover intentions, workplace bullying, and dysfunctional behavior.
12

What Do Cultures Do? (5 of 9)
Studies of ethical climates and workplace outcomes suggest that some climate categories are likely to be found in certain organizations.
By measuring the collective levels of moral sensitivity, judgment, motivation, and character of our organizations, we may be able to judge the strength of the influence our ethical climates have on us.

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Studies of ethical climates and workplace outcomes suggest that some climate categories are likely to be found in certain organizations. Industries with exacting standards such as engineering, accounting, and law tend to have a rules or a law and code climate. Industries that thrive on competitiveness such as financial trading often have an instrumental ethical climate. Industries with missions of benevolence are likely to have a caring climate, even if they are for-profit as in an environmental protection firm. Research is exploring why organizations tend to fall into certain climate categories by industry, especially successful organizations.
We cannot conclude that instrumental climates are always bad, or that caring climates are always good. But by measuring the collective levels of moral sensitivity, judgment, motivation, and character of our organizations, we may be able to judge the strength of the influence our ethical climates have on us.
13

What Do Cultures Do? (6 of 9)
Sustainability: practices that can be maintained over very long periods of time because the tools or structures that support the practices are not damaged by the processes.
Social sustainability practices.
Sustainable management doesn’t need to be purely altruistic.
To create a truly sustainable business, an organization must develop a long-term culture and put its values into practice.
Like other cultural practices we’ve discussed, sustainability needs time and nurturing to grow.

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As the name implies, sustainability refers to practices that can be maintained over very long periods of time because the tools or structures that support the practices are not damaged by the processes.
One survey found that a great majority of executives saw sustainability as an important part of future success.
Social sustainability practices address the ways social systems are affected by an organization’s actions over time, and in turn, how changing social systems may affect the organization. For example, farmers in Australia have been working collectively to increase water use efficiency, minimize soil erosion, and implement tilling and harvesting methods that ensure long-term viability for their farm businesses. In a very different context, 3M has an innovative pollution-prevention program rooted in cultural principles of conserving resources, creating products that have minimal effects on the environment, and collaborating with regulatory agencies to improve environmental effects.
Sustainable management doesn’t need to be purely altruistic. To create a truly sustainable business, an organization must develop a long-term culture and put its values into practice. In other words, there needs to be a sustainable system for creating sustainability! In one workplace study, a company seeking to reduce energy consumption found that soliciting group feedback reduced energy use significantly more than simply issuing reading materials about the importance of conservation. In other words, talking about energy conservation and building the value into the organizational culture resulted in positive employee behavioral changes.
Like other cultural practices we’ve discussed, sustainability needs time and nurturing to grow.
14

What Do Cultures Do? (7 of 9)
Culture and Innovation
The most innovative companies have open, unconventional, collaborative, vision-driven, and accelerating cultures.
Startup firms often have innovative cultures.
They are usually small, agile, and focused on solving problems in order to survive and grow.

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The most innovative companies are often characterized by their open, unconventional, collaborative, vision-driven, and accelerating cultures. Startup firms often have innovative cultures by definition because they are usually small, agile, and focused on solving problems in order to survive and grow.
15

What Do Cultures Do? (8 of 9)
Culture as an Asset
Culture can significantly contribute to an organization’s bottom line in many ways.
There are many more cases of business success stories because of excellent organizational cultures than there are of success stories despite bad cultures, and almost no success stories because of bad ones.

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Culture can also significantly contribute to an organization’s bottom-line in many ways. There are many more cases of business success stories because of excellent organizational cultures than there are of success stories despite bad cultures, and almost no success stories because of bad ones.
16

What Do Cultures Do? (9 of 9)
Culture as a Liability
Institutionalization
Barriers to Change
Barriers to Diversity
Toxicity and Dysfunctions
Barriers to Acquisitions and Mergers

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While culture can certainly enhance an organization, it can also be a liability. We can identify several dysfunctional elements.
The first element involves institutionalization, which is to say it becomes institutionalized—that is, it is valued for itself and not for the goods or services it produces—and it takes on a life of its own, apart from its founders or members. It doesn’t go out of business even if its original goals are no longer relevant. Acceptable modes of behavior become largely self-evident to members, and although this isn’t entirely negative, it does mean behaviors and habits that should be questioned and analyzed become taken for granted, which can stifle innovation and make maintaining the organization’s culture an end in itself.
Second, culture is a liability when the shared values are not in agreement with those that will further the organization’s effectiveness, thus becoming a barrier to change. This is most likely to occur when the environment is dynamic and where there is rapid change, an entrenched culture may no longer be appropriate.
Third is barriers to diversity. Diverse behaviors and strengths are likely to diminish in strong cultures as people attempt to fit in. Strong cultures can be liabilities when they effectively eliminate the unique strengths that people of different backgrounds bring to the organization, or when they support institutional bias or become insensitive to people who are different.
Fourth, toxicity and dysfunctions. Coherence around negativity and dysfunctional management systems in a corporation can produce downward forces that are equally powerful. For example, research on 862 bank employees over about 150 branches of a large bank in the US suggests that branch managers model conflict management styles, which then shape conflict cultures within each branch.59 Collaborative cultures (i.e., encouraging proactive, constructive, and collaborative conflict resolution) tended to increase the cohesion and satisfaction of the branch and decrease levels of burnout. Dominating cultures (i.e., encouraging active confrontation and aggressive competition among employees when there is conflict), tend to reduce branch cohesion and customer service performance. Finally, Avoidance cultures (i.e., that passively avoid conflict) tend to be less creative.
Finally, cultural compatibility has become the primary concern when considering acquisitions and/or mergers. A survey by consulting firm Bain and Company revealed that 70% of mergers failed to reach their financial goals. As one expert commented, “One of the biggest failings is people”— in other words, conflicting organizational cultures.
17

Creating and Sustaining Culture (1 of 6)
How a Culture Begins
Ultimate source of an organization’s culture is its founders.
Founders have the vision of what the organization should be.
New organizations are typically small, which facilitates the founders’ imparting of their vision on all organizational members.

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So, how does a culture begin? The ultimate source of an organization’s culture is its founders. Founders have the vision of what the organization should be. New organizations are typically small, which facilitates the founders’ imparting of their vision on all organizational members.
18

Creating and Sustaining Culture (2 of 6)
Culture creation occurs in three ways:
Founders hire employees who think and feel the way they do.
Employees are indoctrinated and socialized into the founders’ way of thinking.
Founders’ own behavior encourages employees to identify with them and internalize their beliefs, values, and assumptions.

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Culture creation occurs in three ways. First is when founders hire employees who think and feel the way they do. Second, employees are indoctrinated and socialized into the founders’ way of thinking. And third, the founders’ themselves act as role models, encouraging employees to identify with them and internalize their beliefs, values, and assumptions through their own behaviors.
19

Creating and Sustaining Culture (3 of 6)
Keeping a Culture Alive
Selection
Identify and hire individuals with the knowledge, skills, and abilities to perform successfully.
Two-way street.
Top Management
Establish norms of behavior.

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So how can cultures be sustained? The first way is in the selection of employees. The explicit goal of the selection process is to identify and hire individuals with the knowledge, skills, and abilities to perform successfully. The final decision, because it’s significantly influenced by the decision maker’s judgment of how well the candidates will fit into the organization, identifies people whose values are essentially consistent with at least a good portion of the organization’s.
Selection also provides information to applicants. Those who perceive a conflict between their values and those of the organization can remove themselves from the applicant pool. Selection thus becomes a two-way street, allowing employer or applicant to avoid a mismatch and sustaining an organization’s culture by selecting out those who might attack or undermine its core values.
The actions of top management also have a major impact on the organization’s culture. Through words and behavior, senior executives establish norms that filter through the organization about, for instance, whether risk-taking is desirable, how much freedom managers give employees, what is appropriate dress, and what actions earn pay raises, promotions, and other rewards.
20

Creating and Sustaining Culture (4 of 6)
Exhibit 15-2 A Socialization Model

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The socialization component of sustaining a culture is shown in Exhibit 16-2. Socialization is the process of helping new employees adapt to the organization’s culture. The socialization model is a three-stage process.
The first stage is prearrival, which explicitly recognizes that each individual arrives with a set of values, attitudes, and expectations. One way to capitalize on prehire characteristics in socialization is to use the selection process to inform prospective employees about the organization as a whole. The selection process ensures the inclusion of the “right type”—those who will fit in.
The second stage is encounter, in which the individual confronts the possible dichotomy between expectations and reality. If expectations were fairly accurate, the encounter stage merely cements earlier perceptions. However, this is often not the case. At the extreme, a new member may become disillusioned enough to resign. Proper recruiting and selection should significantly reduce that outcome, along with encouraging friendship ties in the organization—newcomers are more committed when friends and coworkers help them “learn the ropes.”
Finally, to work out any problems discovered during the encounter stage, the new member changes or goes through the metamorphosis stage.
21

Creating and Sustaining Culture (5 of 6)
OB POLL Job Is Not as Good as Advertised

Creating and Sustaining Culture (6 of 6)
Exhibit 15-4 How Organizational Cultures Form

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The socialization component of sustaining a culture is shown in Exhibit 16-4. Socialization is the process of helping new employees adapt to the organization’s culture. The socialization model is a three-stage process.
The first stage is prearrival, which explicitly recognizes that each individual arrives with a set of values, attitudes, and expectations. One way to capitalize on prehire characteristics in socialization is to use the selection process to inform prospective employees about the organization as a whole. The selection process ensures the inclusion of the “right type”—those who will fit in.
The second stage is encounter, in which the individual confronts the possible dichotomy between expectations and reality. If expectations were fairly accurate, the encounter stage merely cements earlier perceptions. However, this is often not the case. At the extreme, a new member may become disillusioned enough to resign. Proper recruiting and selection should significantly reduce that outcome, along with encouraging friendship ties in the organization—newcomers are more committed when friends and coworkers help them “learn the ropes.”
Finally, to work out any problems discovered during the encounter stage, the new member changes or goes through the metamorphosis stage.
23

Show How Culture is Transmitted to Employees
How Employees Learn Culture
Culture is transmitted to employees through:
Stories
Rituals
Symbols
Material symbols
Language

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Organizational culture is transmitted to employees through several communication channels. Here we will discuss stories, rituals, symbols, and language.
Stories circulate through many organizations, anchoring the present in the past and legitimating current practices. They typically include narratives about the organization’s founders, rule-breaking, rags-to riches successes, reductions in the workforce, relocation of employees, reactions to past mistakes, and organizational coping. Employees also create their own narratives about how they came to either fit or not fit with the organization during the process of socialization, including first days on the job, early interactions with others, and first impressions of organizational life.
Rituals are repetitive sequences of activities that express and reinforce the key values of the organization.
Symbols are things such as the layout of corporation headquarters, the types of automobiles top executives are given, aircraft, (those are considered material symbols), or size of offices and executive perks. These convey to employees who is important, the degree of egalitarianism top management desires, and the kinds of behavior that are appropriate, such as risk-taking, conservative, authoritarian, participative, individualistic, or social.
Finally, many organizations and subunits within them use language to help members identify with the culture, attest to their acceptance of it, and help preserve it. Unique terms describe equipment, officers, key individuals, suppliers, customers, or products that relate to the business. New employees may at first be overwhelmed by acronyms and jargon that, once assimilated, act as a common denominator to unite members of a given culture or subculture.
24

Influencing an Organizational Culture (1 of 5)
How can management create a more ethical culture?
Be a visible role model.
Communicate ethical expectations.
Provide ethics training.
Visibly reward ethical acts and punish unethical ones.
Provide protective mechanisms.

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Management can create a more ethical culture by following a few simple principles. First, be a visible role model: employees look to top management behavior as a benchmark. Second, communicate ethical expectations: a code of ethics can minimize ethical ambiguities. Third, provide ethical training: training sessions should reinforce standards of conduct and clarify permissible practices. Fourth, visibly reward ethical acts and punish unethical ones: performance appraisal of managers should include analysis of behavior against code of ethics. Finally, provide protective mechanisms: create a support network of ethical counselors, ombudsmen, or ethics officers.
25

Influencing an Organizational Culture (2 of 5)
There is a trend today for organizations to attempt to create a positive organizational culture:
Emphasizes building on employee strengths.
Rewards more than it punishes.
Emphasizes individual vitality growth.
Positive culture is not a cure-all.

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There is a trend today for organizations to attempt to create a positive organizational culture, one that emphasizes building on employee strengths, rewards more than it punishes, and emphasizes individual vitality growth. Keep in mind though, that a positive culture is not a cure-all. It’s still a new enough idea for us to be uncertain about how and when it works best.
26

Influencing an Organizational Culture (3 of 5)
What Is Spirituality?
Workplace spirituality is not about organized religious practices.
It is not about God or theology.
Workplace spirituality recognizes that people have an inner life that nourishes and is nourished by meaningful work that takes place in the context of community.

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Let’s begin by asking, what is spirituality? Workplace spirituality is not about organized religious practices. It is not about God or theology. Workplace spirituality recognizes that people have an inner life that nourishes and is nourished by meaningful work that takes place in the context of community.
27

Influencing an Organizational Culture (4 of 5)
Exhibit 15-5 Reasons for the Growing Interest in Spirituality
Spirituality can counterbalance the pressures and stress of a turbulent pace of life. Contemporary lifestyles—single-parent families, geographic mobility, the temporary nature of jobs, new technologies that create distance between people—underscore the lack of community many people feel and increase the need for involvement and connection.
Formalized religion hasn’t worked for many people, and they continue to look for anchors to replace lack of faith and to fill a growing feeling of emptiness.
Job demands have made the workplace dominant in many people’s lives, yet they continue to question the meaning of work.
People want to integrate personal life values with their professional lives.
An increasing number of people are finding that the pursuit of more material acquisitions leaves them unfulfilled.

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As we noted in our discussion of emotions in Chapter 4, the myth of rationality assumed the well-run organization eliminated feelings. Concern about an employee’s inner life had no role in the perfectly rational model. But just as we’ve now come to realize that the study of emotions improves our understanding of organizational behavior, an awareness of spirituality can help us better understand employee behavior in the twenty-first century. Of course, employees have always had an inner life. So why has the search for meaning and purposefulness in work surfaced now? A summary of reasons is shown in Exhibit 16-5.
28

Influencing an Organizational Culture (5 of 5)
Characteristics of a Spiritual Organization
Cultural characteristics present in spiritual organizations include:
Benevolence
Strong sense of purpose
Trust and respect
Open-mindedness

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The concept of workplace spirituality draws on our previous discussions of values, ethics, motivation, and leadership. Several cultural characteristics tend to be evident in spiritual organizations:
Benevolence: spiritual organizations value showing kindness towards others and promoting the happiness of employees and other organizational stakeholders.
Strong sense of purpose: spiritual organizations build their cultures around a meaningful purpose. Although profits may be important, they’re not the primary value of the organization.
Trust and respect: spiritual organizations are characterized by mutual trust, honesty, and openness. Employees are treated with esteem and value, consistent with the dignity of each individual.
Open-mindedness: spiritual organizations value flexible thinking and creativity among employees.
29

Identify Characteristics of a Spiritual Culture (1 of 2)
Achieving a Spiritual Organization
Many organizations have grown interested in spirituality but have had difficulty putting its principles into practice.
Leaders can demonstrate values, attitudes, and behaviors that trigger intrinsic motivation and a sense of calling through work.
Encouraging employees to consider how their work provides a sense of purpose through community building also can help achieve a spiritual workplace.

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Many organizations have grown interested in spirituality but have had difficulty putting its principles into practice. Several types of practices can facilitate a spiritual workplace, including those that support work-life balance. Leaders can demonstrate values, attitudes, and behaviors that trigger intrinsic motivation and a sense of calling through work. Encouraging employees to consider how their work provides a sense of purpose through community building also can help achieve a spiritual workplace; often this is achieved through group counseling and organizational development, a topic we take up in Chapter 18. A number of organizations are now also offering employees the services of a chaplain.
30

Identify Characteristics of a Spiritual Culture (2 of 2)
Critics of spirituality in organizations focus on:
The question of scientific foundation: what really is workplace spirituality?
Are spiritual organizations legitimate? Do organizations have the right to impose spiritual values on their employees?
The question of economics: are spirituality and profits compatible?

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Critics of the spirituality movement in organizations have focused on three issues. First is the question of scientific foundation. What really is workplace spirituality? Second, are spiritual organizations legitimate? Do organizations have the right to impose spiritual values on their employees? And third is the question of economics: are spirituality and profits compatible?
As you might imagine, there is comparatively little research on workplace spirituality. Moreover, an emphasis on spirituality can clearly make some employees uneasy. Critics have argued that secular institutions, especially business firms, have no business imposing spiritual values on employees. This criticism is undoubtedly valid when spirituality is defined as bringing religion and God into the workplace. However, it seems less stinging when the goal is limited to helping employees find meaning and purpose in their work lives. If the concerns listed in Exhibit 16-5 truly characterize a large segment of the workforce, then perhaps organizations can do so.
31

The Global Context
Organizational cultures often reflect national culture.
One of the primary things U.S. managers can do is to be culturally sensitive.
The management of ethical behavior is one area where national culture can rub up against corporate culture.

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Organizational cultures often reflect national culture. The culture at AirAsia, a Malaysian-based airline, emphasizes openness and friendships. However, the culture of many U.S. airlines does not reflect the same degree of informality. If U.S. airlines were to merge with AirAsia, they would need to take these cultural differences into account.
One of the primary things U.S. managers can do is to be culturally sensitive. The United States is a dominant force in business and in culture, and with that influence comes a reputation. “We are broadly seen throughout the world as arrogant people, totally self-absorbed and loud,” says one U.S. executive. Some ways in which U.S. managers can be culturally sensitive include talking in a low tone of voice, speaking slowly, listening more, and avoiding discussions of religion and politics.
The management of ethical behavior is one area where national culture can rub up against corporate culture. Many strategies for improving ethical behavior are based on the values and beliefs of the host country. U.S. managers endorse the supremacy of anonymous market forces and implicitly or explicitly view profit maximization as a moral obligation for business organizations. This worldview sees bribery, nepotism, and favoring personal contacts as highly unethical. Any action that deviates from profit maximization may indicate that inappropriate or corrupt behavior may be occurring. In contrast, managers in developing economies are more likely to see ethical decisions as embedded in a social environment. That means doing special favors for family and friends is not only appropriate but also may even be an ethical responsibility. Managers in many nations also view capitalism skeptically and believe the interests of workers should be put on a par with the interests of shareholders.
32

Implications for Managers (1 of 3)
Exhibit 15-6 How Organizational Cultures Have an Impact on Employee Performance and Satisfaction

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Exhibit 16-6, in summary, depicts organizational culture as an intervening variable. Employees form an overall subjective perception of the organization based on factors such as degree of risk tolerance, team emphasis, and support of people. This overall perception becomes, in effect, the organization’s culture or personality and affects employee performance and satisfaction, with stronger cultures having greater impact.
33

Implications for Managers (2 of 3)
Realize that an organization’s culture is relatively fixed in the short term. To effect change, involve top management and strategize a long-term plan.
Hire individuals whose values align with those of the organization; these employees will tend to remain committed and satisfied. Not surprisingly, “misfits” have considerably higher turnover rates.
Understand that employees’ performance and socialization depend to a considerable degree on their knowing what to do and not do. Train your employees well and keep them informed of changes to their job roles.

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Managers should:
Realize that an organization’s culture is relatively fixed in the short term. To effect change, involve top management and strategize a long-term plan.
Hire individuals whose values align with those of the organization; these employees will tend to remain committed and satisfied. Not surprisingly, “misfits” have considerably higher turnover rates.
Understand that employees’ performance and socialization depend to a considerable degree on their knowing what to do and not do. Train your employees well and keep them informed of changes to their job roles.
34

Implications for Managers (3 of 3)
You can shape the culture of your work environment, sometimes as much as it shapes you. All managers can especially do their part to create an ethical culture and to consider spirituality and its role in creating a positive organizational culture.
Be aware that your company’s organizational culture may not be “transportable” to other countries. Understand the cultural relevance of your organization’s norms before introducing new plans or initiatives overseas.

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In addition:
As a manager, you can shape the culture of your work environment, sometimes as much as it shapes you. All managers can especially do their part to create an ethical culture and to consider spirituality and its role in creating a positive organizational culture.
Be aware that your company’s organizational culture may not be “transportable” to other countries. Understand the cultural relevance of your organization’s norms before introducing new plans or initiatives overseas.
35

Questions?

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Organizational Behavior
Eighteenth Edition, Global Edition
Chapter 16
Human Resource Policies and Practices
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Learning Objectives
16.1 Describe the value of recruitment methods.
16.2 Specify initial selection methods.
16.3 Identify the most useful substantive selection methods.
16.4 Compare the main types of training.
16.5 List the methods of performance evaluation.
16.6 Describe the leadership role of HR in organizations.

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After studying this chapter, should be able to:
Describe the value of recruitment methods.
Specify initial selection methods.
Identify the most useful substantive selection methods.
Compare the main types of training.
List the methods of performance evaluation.
Describe the leadership role of HR in organizations.
39

Describe the Value of Recruitment Methods
Strategic recruiting has become a cornerstone for many companies, in which recruiting practices are developed in alignment with long-term strategic goals.
The most effective recruiters—internal or external—are well informed about the job, are efficient in communicating with potential recruits, and treat recruits with consideration and respect. They also use a variety of online tools, including job boards and social media.

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The first stage in any HR program is recruiting, closely followed by selection. A selection system can only be as good as the individuals who apply in the first place.
Strategic recruiting has become a cornerstone for many companies, in which recruiting practices are developed in alignment with long-term strategic goals. As for defining “success” in recruiting, most research suggests that the best system attracts candidates who are highly knowledgeable about the job and the organization. Such candidates are likely to have a better fit between their skills and job requirements, and to be more satisfied in the jobs they take.
Consistent with these findings, some of the most effective recruiting techniques include internal referrals, internship programs, and other methods that give potential applicants enough information to adequately evaluate the roles they may be occupying. Companies are increasingly turning away from outside recruiting agencies and relying on their own executives and HR professionals for talent searches.
The most effective recruiters—internal or external—are well informed about the job, are efficient in communicating with potential recruits, and treat recruits with consideration and respect. They also use a variety of online tools, including job boards and social media, to bring in applications.
40

Specify Initial Selection Methods
Exhibit 16-1 Model of Selection Process in Organizations

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One of the most important HR functions is hiring the right people. When companies hire the right people, they increase their human capital resources. Human capital resources are the capacities available to an organization through its employees. The resources include specialized skills, collective knowledge, abilities, and other resources available through an organization’s workforce.
The goal of the selection process is to match individual characteristics with the job – in other words, finding the right person for the job. Exhibit 17-1 shows that new job applicants go through several sections stages: initial selection, substantive selection, and contingent selection.
Initial selection devices are the first information applicants submit and are used for preliminary rough cuts to decide whether the applicant meets the basic qualifications for a job. The initial selection stage usually requires an application form. While these are not a good predictor of performance, they are a good initial screen. Most applications today begin online. Care should be exercised on the questions included in an application to avoid conflict with legal and ethical limitations. During this initial stage, the application may undergo background checks such as checking credit histories or criminal records. Letters of recommendation are a form of background check.
Next, we will discuss substantive and contingent selection.
41

Identify the Most Useful Substantive Selection Methods (1 of 5)
Substantive Selection
Written tests
Performance simulation tests
Interviews

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Substantive selection is at the heart of the selection process and is used after the applicant passes initial screening. It includes written tests, performance simulation tests, and interviews. Let’s look at each one in more detail.
42

Identify the Most Useful Substantive Selection Methods (2 of 5)
Written Tests
Typically tests of intelligence or cognitive ability, personality, and integrity.
Intelligence tests are particularly good predictors for jobs that require cognitive complexity.
Evidence shows that these tests are good predictors, but care should be taken to use the “right” test.

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Long popular as selection devices, written employment tests—called “paper-and-pencil” tests, though most are now available online—declined in use between the late 1960s and mid-1980s, especially in the United States. They were frequently characterized as discriminatory, and many organizations had not validated them as job-related. Since then, however, there has been a resurgence, and today most organizations have at least considered using one or more tests.29 Managers recognize that valid tests can help predict who will be successful on the job.30 Applicants, however, tend to view written tests as less valid and fair than interviews or performance tests.31 Typical tests include (1) intelligence or cognitive ability tests, (2) personality tests, and (3) integrity tests.
Intelligence tests are particularly good predictors for jobs that require cognitive complexity. Tests in intellectual ability, spatial and mechanical ability, perceptual accuracy, and motor ability have shown to be moderately valid predictors for many semiskilled and unskilled operative jobs. As ethical problems have increased in organizations, integrity tests have gained popularity. These paper-and-pencil tests that measure dependability, carefulness, responsibility, and honesty. While these tests are powerful predictors of performance, care should be taken that the test actually measures criteria matched to the job responsibilities.
43

Identify the Most Useful Substantive Selection Methods (3 of 5)
Performance-Simulation Tests
Have higher face validity and their popularity has increased.
Work sample tests: hands-on simulations of part or all of the job that must be performed by applicants.
Assessment centers: evaluate managerial potential.
Situational judgment tests
Realistic Job Previews

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Although they are more complicated to develop and administer than written tests, performance-simulation tests have higher face validity, which measures whether applicants perceive the measures to be accurate, and their popularity has increased. The three best-known performance simulation tests are work samples, assessment centers, and situational judgment tests.
Work sample tests are hands-on simulations of part or all of the job that must be performed by applicants. Work samples are based on job analysis data, and each element is matched with a corresponding job performance element. Work samples yield valid data superior to written aptitude and personality tests.
Assessment centers use a more elaborate set of performance simulation tests designed to evaluate a candidate’s managerial potential. Line executives, supervisors, and/or trained psychologists evaluate candidates as they go through one to several days of exercises that simulate real problems. Assessment centers have consistently demonstrated results that predict later job performance in managerial positions.
Situational judgment tests ask applicants how they would perform in a variety of job situations and compare their answers to those of high-performing employees. One study comparing situational judgment tests to assessment centers found the assessment center was a better predictor of job performance, although the difference was not large. Ultimately, the lower cost of the situational judgment test may make it a better choice for some organizations than a more elaborate work sample or assessment center.
Finally, realistic job previews are given as a way to assess talent versus experience. They decrease turnover because both employers and new hires know what they are getting into ahead of time.
44

Identify the Most Useful Substantive Selection Methods (4 of 5)
Interviews
The most frequently used selection device.
It carries a great deal of weight.
Unstructured interviews are not as effective as structured ones, particularly behavioral structured interviews.
Panel interviews minimize the influence of individual biases and have higher validity.

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The interview continues to be the selection device most frequently used and it carries a great deal of weight. The candidate who performs poorly in the employment interview is likely to be cut, regardless of his/her experience, test scores, or letters of recommendation, and vice versa. This is important because of the unstructured form of most selection interviews.
The unstructured interview—short in duration, casual, and made up of random questions—is an ineffective selection device. The data are typically biased and often unrelated to future job performance. Without structure, interviewers tend to favor applicants who share their attitudes, give undue weight to negative information, and allow the order in which applicants are interviewed to influence their evaluations. To reduce such bias and improve the validity of interviews, managers should adopt a standardized set of questions, a uniform method of recording information, and standardized ratings of applicants’ qualifications. Training interviewers to focus on specific dimensions of job performance, practicing evaluation of sample candidates, and giving interviewers feedback on how well they were focused on job-relevant characteristics significantly improves the accuracy of their ratings.
Interview effectiveness also improves when employers use behavioral structured interviews, probably because these assessments are less influenced by interviewer biases. They require applicants to describe how they handled specific problems and situations in previous jobs, based on the assumption that past behavior offer the best predictor of future behavior.
Panel interviews also minimize the influence of individual biases and have higher validity.
Most organizations use interviews as more than a prediction of performance device.
45

Identify the Most Useful Substantive Selection Methods (5 of 5)
Contingent Selection
Applicants that pass the substantive selection process are ready to be hired, contingent on final checks.
A common contingent method is a drug test.
Drug testing is controversial.
Under the Americans with Disabilities Act, firms may not require employees to pass a medical exam before a job offer is made.

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Once an applicant has passed substantive selection such as background checks, interviews, and so on, the individual is ready to be hired subject to a final check.
One common, but controversial, contingent method is a drug test. Many applicants think testing without reasonable suspicion is invasive or unfair and say they should be tested on job performance factors, not lifestyle choices that may not be relevant. Employers might counter that drug use and abuse are extremely costly, not just in financial terms but also in terms of people’s safety. They have the law on their side: the U.S. Supreme Court has concluded that drug tests are “minimally invasive” selection procedures that as a rule, do not violate individuals’ rights.
Under the Americans with Disabilities Act, firms may not require employees to pass a medical exam before a job offer is made. They can conduct medical exams after making a contingent offer, to determine whether an applicant is physically or mentally able to do the job.
46

Compare the Main Types of Training (1 of 3)
Types of Training
Basic skills
Technical skills
Problem-solving skills
Interpersonal skills
In addition, we consider:
Civility training
Ethics training

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There are four general skill categories for training: basic literacy, technical skills, problem-solving skills, and interpersonal skills. In addition, we discuss civility training and ethics training.
47

Compare the Main Types of Training (2 of 3)
Basic Skills
Many employers believe that high school graduates lack basic skills in reading comprehension, writing, and math.
As work has become more sophisticated, the need for these basic skills has grown significantly.
It’s a worldwide problem, from the most developed countries to the least.

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Let’s begin with basic skills. One survey of more than 400 human resources professionals found that 40 percent of employers believe high school graduates lack basic skills in reading comprehension, writing, and math. As work has become more sophisticated, the need for these basic skills has grown significantly, leading to a gap between employer demands for skills and the available skills in the workforce. The challenge isn’t unique to the United States. It’s a worldwide problem, from the most developed countries to the least. For many undeveloped countries, widespread illiteracy means there is almost no hope of competing in a global economy. As a result, organizations find they must provide basic reading and math skills for their employees.
48

Compare the Main Types of Training (3 of 3)
Technical Skills
Technical training is important for:
New technology
New structural designs
As organizations flatten their structures, expand their use of teams, and break down traditional departmental barriers, employees need mastery of a wider variety of tasks and increased knowledge of how their organization operates.

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Second, most training is directed at upgrading and improving an employee’s technical skills. Technical training is important for two reasons—new technology and new structural designs.
As organizations flatten their structures, expand their use of teams, and break down traditional departmental barriers, employees need mastery of a wider variety of tasks and increased knowledge of how their organization operates. Companies like Tata and Wipro provide new hires with up to 3 months of training to ensure that have the knowledge to perform the technical work demanded.
49

Compare the Four Main Types of Training (1 of 4)
Problem-Solving Skills
Problem-solving training for managers and other employees can include:
Activities to sharpen their logic, reasoning, and problem defining skills.
Activities to improve their abilities to assess causation, develop and analyze alternatives, and select solutions.

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Next we turn to problem-solving skills. Problem-solving training for managers and other employees can include activities to sharpen their logic, reasoning, and problem defining skills as well as their abilities to assess causation, develop and analyze alternatives, and select solutions.
Problem-solving training has become a part of almost every organizational effort to introduce self-managed teams or implement quality-management programs.
50

Compare the Four Main Types of Training (2 of 4)
Interpersonal Skills
Almost all employees belong to a work unit where their work performance depends on their ability to interact with coworkers and bosses.

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Next are interpersonal skills. Almost all employees belong to a work unit, so to some degree, their work performance depends on their ability to effectively interact.
51

Compare the Four Main Types of Training (3 of 4)
Civility Training
As HR managers have become more aware of the effects of social behavior in the workplace, they have paid more attention to incivility, bullying, and abusive supervision in organizations.
To minimize incivility, use training targeted to building civility.

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As HR managers have become increasingly aware of the effects of social behavior in the workplace, they have paid more attention to the problems of incivility, bullying, and abusive supervision in organizations. Examples of incivility include being ignored, being excluded from social situations, having your reputation undermined in front of others, and experiencing other actions meant to demean or disparage. Researchers have shown that these forms of negative behavior can decrease satisfaction, reduce job performance, increase perceptions of unfair treatment, increase depression, and lead to psychological withdrawal from the workplace.
The evidence suggests that deliberate interventions to improve the workplace climate for positive behavior can indeed minimize the problems of incivility. One possibility is training specifically targeted to building civility by having directed conversations about it and supporting the reduction of incivility on an ongoing process.
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Compare the Four Main Types of Training (4 of 4)
Ethics Training
Many U.S. workers receive ethics training.
Can ethics be taught?
Critics argue that ethics are based on values, and value systems are fixed at an early age.
Ethics cannot be formally “taught” but must be learned by example.
Supporters say values can be learned, and that training is helpful for recognizing ethical dilemmas and ethical issues.

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Finally, we come to ethics training. It is common for employees to receive ethics training.
Critics argue that ethics are based on values, and value systems are fixed at an early age, and that ethics cannot be formally “taught” but must be learned by example.
Supporters of ethics training argue that values can be learned and changed after early childhood. Even if this isn’t true, training helps employees to recognize ethical dilemmas, become more aware of the ethical issues underlying their actions, and reaffirms an organization’s expectations. Individuals who have greater exposure to organizational ethics codes and ethics training do tend to be more satisfied and perceive their organizations as more socially responsible, so ethics training does have some positive effects.
53

Contrast Formal and Informal Training Methods (1 of 3)
Training Methods
Historically, training meant “formal training”.
Organizations are increasingly relying on informal training.
Unstructured, unplanned, and easily adapted to situations and individuals.

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Historically, training meant “formal training,” or something that is planned in advance and has a structured format. However, organizations are increasingly relying on informal training, which is unstructured, unplanned, and easily adapted to situations and individuals. Most informal training is nothing other than employees helping each other out. They share information and solve work-related problems with one another.
54

Contrast Formal and Informal Training Methods (2 of 3)
Job Training
On-the-job training includes job rotation, apprenticeships, understudy assignments, and formal mentoring programs.
Off-the-job training includes live classroom lectures, videotapes, public seminars, self-study, Internet and satellite television courses, group activities, and e-training.
Computer-Based Training

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On-the-job training includes job rotation, apprenticeships, understudy assignments, and formal mentoring programs. The primary drawback of these methods is that they often disrupt the workplace.
Computer-based training. Recently, e-training (computer-based training) is the fastest growing training delivery mechanism.
Organizations are investing increasingly in off-the-job training—nearly $130 billion annually. What types of training might this include? The most popular is live classroom lectures. It also encompasses videotapes, public seminars, self-study programs, Internet courses, satellite-beamed television classes, and group activities that use role-plays and case studies. Recently, e-training (computer-based training) is the fastest growing training delivery mechanism.
55

Contrast Formal and Informal Training Methods (3 of 3)
Evaluating Effectiveness
The effectiveness of a training program can refer to the level of student satisfaction, the amount students learn, the extent to which they transfer the material from training to their jobs, or the financial return on investments in training.
An effective training program requires not just teaching the skills, but also changing the work environment to support the trainees.

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The effectiveness of a training program can refer to the level of student satisfaction, the amount students learn, the extent to which they transfer the material from training to their jobs, or the financial return on investments in training.
Not all training methods are equally effective, so rigorous measurement of multiple training outcomes should be a part of every training effort.
The success of training also depends on the individual. If individuals are unmotivated, they will learn very little.
Personality is important: those with an internal locus of control, high conscientiousness, high cognitive ability, and high self-efficacy learn more. The climate also is important: when trainees believe that there are opportunities and resources to let them apply their newly learned skills, they are more motivated and do better in training programs. After-training support from supervisors and coworkers has a strong influence on whether employees transfer their learning into new behavior.
Lastly, an effective training program requires not just teaching the skills, but also changing the work environment to support the trainees.
56

List the Methods of Performance Evaluation (1 of 9)
What is Performance?
Three major types of behavior to consider:
Task performance
Citizenship
Counterproductivity
Most managers believe good performance means doing well on the first two dimensions and avoiding the third.

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In the past, most organizations assessed only how well employees performed the tasks listed on a job description, but today’s less hierarchical and more service-oriented organizations require more.
Researchers now recognize three major types of behavior that constitute performance at work:
Task performance – performing the duties and responsibilities that contribute to the production of a good or service or to administrative tasks. This includes most of the tasks in a conventional job description.
Citizenship – actions that contribute to the psychological environment of the organization, such as helping others when not required, supporting organizational objectives, treating coworkers with respect, making constructive suggestions, and saying positive things about the workplace.
Counter-productivity – actions that actively damage the organization. These behaviors include stealing, damaging company property, behaving aggressively toward coworkers, and taking avoidable absences.
Most managers believe good performance means doing well on the first two dimensions and avoiding the third. A person who does core job tasks very well but is rude and aggressive toward coworkers is not going to be considered a good employee in most organizations, and even the most pleasant and upbeat worker who can’t do the main job tasks well is not going to be a good employee.
57

List the Methods of Performance Evaluation (2 of 9)
Purposes of Performance Evaluation
Make general human resource decisions.
Identify training and development needs.
Pinpoint employee skills and competencies needing development.
Provide feedback to employees.
Can be the basis for reward allocations.

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Let’s talk a little about the purposes of performance evaluation. Management uses evaluations for general human resource decisions, such as promotions, transfers, and terminations. Evaluations also identify training and development needs, as they pinpoint employee skills and competencies needing development and can provide criterion against which selection and development programs are validated.
Evaluations also provide feedback to employees on how the organization views their performance and are often the basis for reward allocations including merit pay increases.
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List the Methods of Performance Evaluation (3 of 9)
What Do We Evaluate?
Individual task outcomes
Behaviors
Traits
Who Should Do the Evaluating?
Traditionally, the manager, but today that is changing.
Now peers, subordinates, and the employee can be involved.

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What do we evaluate? The criteria or criterion used to evaluate performance has a major influence on performance. The three most popular sets of criteria are individual task outcomes, behaviors, and traits. If ends count, rather than means, then management should evaluate an employee’s task outcomes. It is difficult to attribute specific outcomes to the actions of employees in advisory or support positions or employees whose work assignments are part of a group effort; we may readily evaluate the group’s performance, but if it is hard to identify the contribution of each group member, management will often evaluate the employee’s behavior. The weakest set of criteria is individual traits because they are farthest removed from the actual performance of the job itself. Traits may or may not be highly correlated with positive task outcomes, but only the naive would ignore the reality that such traits are frequently used in organizations for assessing performance.
Who should do the evaluating? Traditionally, the task has fallen to managers, because they are held responsible for their employees’ performance, but others may do the job better. With many of today’s organizations using self-managed teams, telecommuting, and other organizing devices that distance bosses from employees, the immediate superior may not be the most reliable judge of an employee’s performance. More and more, peers and even subordinates are being asked to take part in the process, and employees are participating in their own evaluation. A recent survey found about half of executives and 53% of employees now have input into their performance evaluations.
As you might expect, self-evaluations often suffer from over-inflated assessment and self-serving bias, and they seldom agree with superiors’ ratings. So they are probably better suited to developmental than evaluative purposes and should be combined with other sources of information to reduce rating errors. In most situations, in fact, it is highly advisable to use multiple sources of ratings. Any individual performance rating may say as much about the rater as about the person being evaluated. By averaging across raters, we can obtain a more reliable, unbiased, and accurate performance evaluation.
59

List the Methods of Performance Evaluation (4 of 9)
Exhibit 16-2 360-Degree Evaluations

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Another approach to performance evaluation is 360-degree evaluations. As shown in Exhibit 17-2, 360-degree evaluations provide performance feedback from the employee’s full circle of daily contacts, from mailroom workers to customers to bosses to peers. The number of appraisals can be as few as 3 or 4 or as many as 25; most organizations collect 5 to 10 per employee.
Evidence on the effectiveness of the 360-degree evaluation is mixed. It provides employees with a wider perspective on their performance, but many organizations don’t spend the time to train evaluators in giving constructive criticism.
60

List the Methods of Performance Evaluation (5 of 9)
Methods of Performance Evaluation
Written Essays
Critical Incidents
Graphic Ratings Scales
Behaviorally Anchored Rating Scales (BARS)
Forced Comparisons
Group order ranking
Individual ranking

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There are several different methods to evaluate an employee’s performance.
First, written essays are the simplest method of evaluation. It involves writing a narrative describing an employee’s strengths, weaknesses, past performance, potential, and suggestions for improvement. No complex forms or extensive training is required, but the results often reflect the ability of the writer.
Second is critical incidents. These focus on those behaviors that are key in making the difference between executing a job effectively and executing it ineffectively. The appraiser writes down anecdotes that describe what the employee did that was especially effective or ineffective. A list of critical incidents provides a rich set of examples to discuss with the employee.
Third is graphic ratings scales, based on a set of performance factors, such as quantity and quality of work, depth of knowledge, cooperation, loyalty, attendance, honesty, and initiative. The evaluator then goes down the list and rates each on incremental scales. They are popular because they are less time-consuming to develop and administer, and allow for quantitative analysis and comparison.
Fourth is behaviorally anchored rating scales, or BARS, which combine major elements from the critical incident and graphic rating scale approaches. The appraiser rates the employees based on items along a continuum, but the points are examples of actual behavior. To develop the BARS, participants first contribute specific illustrations of effective and ineffective behavior, which are translated into a set of performance dimensions with varying levels of quality.
Finally, forced comparisons evaluate one individual’s performance against the performance of one or more. So, it’s a relative rather than an absolute measuring device. The two most popular are group order ranking and individual ranking. The group order ranking requires the evaluator to place employees into a particular classification, such as top one-fifth or second one-fifth. The individual ranking approach rank-orders employees from best to worst.
61

List the Methods of Performance Evaluation (6 of 9)
Exhibit 16-3 Median Grade Point Average (GPA ) by Academic Year and Degree Level
* Note: Study of GPA from 1,683 courses, 28 departments, and 3,176 instructors at a large public university.
Source: Based on R. Todd Jewell, M. A. McPherson, and M. A. Tieslau, “Whose Fault Is It? Assigning Blame for Grade Inflation in Higher Education,” Applied Economics 45 (2013): 1185–200.

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One parallel to forced ranking is forced distribution of college grades. As shown in Exhibit 17-3, the average GPAs have gotten much higher over time.
62

List the Methods of Performance Evaluation (7 of 9)
Improving Performance Evaluations:
Use multiple evaluators.
Evaluate selectively.
Train evaluators.
Provide employees with due process.
Three features of due process.
Post appraisals online.

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The performance evaluation process is a potential minefield. Evaluators can unconsciously inflate evaluations (positive leniency), understate performance (negative leniency), or allow the assessment of one characteristic to unduly influence the assessment of others (the halo error). Some appraisers bias their evaluations by unconsciously favoring people who have qualities and traits similar to their own (the similarity error). And, of course, some evaluators see the evaluation process as a political opportunity to overtly reward or punish employees they like or dislike.
Some suggestions for methods to improve evaluation processes and outcomes start with the use of multiple evaluators. As the number of evaluators increases, the probability of attaining more accurate information increases. If a set of evaluators judges a performance, the highest and lowest scores are dropped, and the final performance evaluation is made up from the cumulative scores of those remaining.
Second is to evaluate selectively. Evaluate only those areas in which you have some expertise. Appraisers should be as close as possible, in terms of organizational level, to the individual being evaluated.
Third is to train evaluators. There is substantial evidence that training evaluators can make them more accurate raters. Most rater training courses emphasize changing the raters’ frame of reference by teaching them what to look for, so everyone in the organization defines good performance in the same way.
Fourth is to provide employees with due process. The concept of due process increases the perception that employees are treated fairly.
Three features characterize due process systems: individuals are provided with adequate notice of what is expected of them; all relevant evidence is aired in a fair hearing so individuals affected can respond; and the final decision is based on the evidence and is free from bias. One technique organizations might consider to enhance due process is posting appraisals online so employees can see their own performance scores exactly as the supervisor enters them.
63

List the Methods of Performance Evaluation (8 of 9)
Providing Performance Feedback
Managers are often uncomfortable discussing weaknesses with employees.
In fact, unless pressured by organizational policies and controls, managers are likely to ignore this responsibility.
The solution to the problem is not to ignore it but to train managers to conduct constructive feedback sessions.

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Providing performance feedback is a key method to improve evaluation, but managers are often uncomfortable discussing weaknesses with employees. In fact, unless pressured by organizational policies and controls, managers are likely to ignore this responsibility.
The solution to the problem is not to ignore it but to train managers to conduct constructive feedback sessions. An effective review—in which the employee perceives the appraisal as fair, the manager as sincere, and the climate as constructive—can leave the employee feeling upbeat, informed about areas needing improvement, and determined to correct them. Appraisals should also be as specific as possible.
64

List the Methods of Performance Evaluation (9 of 9)
International Variations in Performance Appraisal
Individual-oriented cultures emphasize formal performance evaluation systems more than informal systems.

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Let’s examine performance evaluation globally in the context of four cultural dimensions: individualism/collectivism, a person’s relationship to the environment, time orientation, and focus of responsibility.
Individual-oriented cultures such as the United States emphasize formal performance evaluation systems more than informal systems. In Korea, Singapore, and even Japan, the use of performance evaluation has increased dramatically in the past decade, though not always smoothly or without controversy. One survey of Korean employees revealed that a majority questioned the validity of their performance evaluation results. One recent study focused on the banking industry found significant differences across countries in performance appraisal practices.
Formal performance appraisals were used more frequently in countries that were high in assertiveness, high in uncertainty avoidance, and low in in-group collectivism.
Another study found that individuals who were high in power distance and high in collectivism tend to give more lenient performance appraisals.
65

Describe the Leadership Role of HR in Organizations (1 of 5)
Communicating HR Practices
Leadership by HR begins with informing employees about HR practices and explaining the implications of decisions that might be made around these practices.
It is not enough to simply have a practice in place; HR needs to let employees know about it.

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Leadership by HR begins with informing employees about HR practices and explaining the implications of decisions that might be made around these practices. It is not enough to simply have a practice in place; HR needs to let employees know about it. When a company successfully communicates how the whole system of HR practices has been developed and what function this system serves, employees feel they can control and manage what they get out of work.
The evidence supporting the contribution of communication and perception to HR effectiveness is considerable. For example, one study of different business units within a large food-service organization found that employee perceptions of HR practices, rated at the workgroup level, were significant predictors of OCB, commitment, and intention to remain with the company, but the HR practices led to these positive outcomes only if employees were aware they were in place.
The effectiveness of HR practices also depends on employee attitudes. One review found that HR practices were more likely to lead to positive outcomes when employees felt motivated. Practices tend to be perceived differently in various business cultures. For example, the use of educational qualifications in screening candidates seems to be a universal practice, but aside from this, different countries emphasize different selection techniques.
Structured interviews are popular in some countries and nonexistent in others. Communication is the bridge for HR to demonstrate fairness intentions.
66

Describe the Leadership Role of HR in Organizations (2 of 5)
Designing and Administering Benefit Programs
A benefit program should:
Be suited to the organizational culture.
Reflect the values of the organization.
Demonstrate economic feasibility.
Be sustainable in the long term.
Benefits will likely improve employees’ psychological well-being and therefore increase organizational performance.

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The responsibility for designing and administering an organization’s benefit program falls to the HR department, with input from executive management.
Ideally, a benefit program should be uniquely suited to the organizational culture, reflect the values of the organization, demonstrate economic feasibility, and be sustainable in the long term. Such benefits will likely improve employees’ psychological well-being and therefore increase organizational performance.
67

Describe the Leadership Role of HR in Organizations (3 of 5)
Drafting and Enforcing Employment Policies
Employment policies that are informed by current laws but go beyond minimum requirements will help define a positive organizational culture and set high standards for performance.
Policies differ from benefits in that they provide the guidelines for behavior, not just the working conditions.
Any policy must have enforcement to be effective.

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Employment policies that are informed by current laws but go beyond minimum requirements will help define a positive organizational culture and set high standards for performance. Policies differ from benefits in that they provide the guidelines for behavior, not just the working conditions.
Any policy must have enforcement to be effective. Human resource managers are responsible for setting the organizational consequences of infractions, and often for enforcing the policies as well. Sometimes, human resource managers will need to take action even when the employee’s direct manager may not agree, especially if compliance with the law is at issue.
68

Describe the Leadership Role of HR in Organizations (4 of 5)
Managing Work-Life Conflicts
Gained momentum in the 1980s as a result of the increased entry of women in the workforce.
Keeping workloads reasonable, reducing work-related travel, and offering on-site quality childcare are examples of practices that can help manage work-life conflicts.
Different people prefer different solutions.

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Work-life conflicts grabbed management’s attention in the 1980s, largely as a result of the growing number of women, with dependent children, entering the workforce. In response, most major organizations took actions to make their workplaces more family friendly. They introduced on-site childcare, summer day camps, flextime, job sharing, leaves for school functions, telecommuting, and part-time employment.
Organizations are modifying their workplaces with scheduling options and benefits to accommodate the varied needs of a diverse workforce. But it’s the psychological incursion of work into the family domain, and vice versa, when people are worrying about personal problems at work and thinking about work problems at home. This suggests organizations should spend less effort helping employees with time-management issues and more helping them clearly segment their lives. Keeping workloads reasonable, reducing work-related travel, and offering on-site quality childcare are examples of practices that can help in this endeavor. Not surprisingly, people differ in their preference for scheduling options and benefits. Some prefer organizational initiatives that better segment work from their personal lives, as flextime, job sharing, and part-time hours do by allowing employees to schedule work hours less likely to conflict with personal responsibilities. Others prefer ways to integrate work and personal life, such as on-site childcare, gym facilities, and company-sponsored family picnics.
69

Describe the Leadership Role of HR in Organizations (5 of 5)
Mediations, Terminations, and Layoffs
Human resource departments often take center stage when unpleasant events such as disputes, substandard performance, and downsizing occur.
Employees need to be able to trust their human resource professionals to maintain appropriate confidentiality and a balanced perspective.
Managers need to be able to trust HR, too, to know the laws and represent the company’s perspective.

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Human resource departments often take center stage when unpleasant events such as disputes, substandard performance, and downsizing occur. Employees need to be able to trust their human resource professionals to maintain appropriate confidentiality and a balanced perspective. Managers need to be able to trust HR, too, to know the laws and represent the company’s perspective. The HR human resource professional should be well trained in mediation techniques and rely upon company policies to seek positive resolution.
Sometimes, human resource managers are integral to the termination process, when employees are not able to resolve issues with management. Termination processes are subject to union labor contracts and laws, which can confound the situation. In Spain, for instance, labor laws have traditionally protected older workers with near-guaranteed employment.
For departing employees, the HR department is often the last stop on their way out the door. HR managers are thus in charge of leaving a favorable impression with the employee and collecting helpful input from the exit interview. This is never more true than when organizations terminate employees in layoffs.
In sum, the role of HR is increasing for organizations worldwide, and top management is realizing human resource leadership is needed to create the cultures and positive business outcomes top corporations need to stay competitive.
70

Implications for Managers (1 of 3)
An organization’s selection practices can identify competent candidates and accurately match them to the job and the organization. Consider assessment methods that are most likely to evaluate the skills directly needed for jobs you are looking to fill.
Use training programs for your employees to achieve direct improvement in the skills necessary to successfully complete the job. Employees who are motivated will use those skills for their greater productivity.

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An organization’s human resource (HR) policies and practices create important forces that greatly influence organizational behavior (OB) and important work outcomes. HR departments have become increasingly integral in shaping the composition of the organization’s workforce. First, as more organizations have turned to internal recruitment methods, HR departments have taken the lead in creating online portals and other easy-access methods for candidates to learn about the organization and be attracted to apply. Second, HR departments are involved in all phases of selection: initial selection, substantive selection, and contingent selection. The greatest increase in the involvement of HR in selection may be in the initial selection phase, wherein HR professionals develop, monitor, and screen the great numbers of applications that are submitted. However, HR involvement has increased in all areas of selection, and HR professionals are responsible for understanding the applicable laws and guidelines to serve as an informed, up-to-date resource for managers. In effective organizations, HR remains present throughout an employee’s time with the organization. HR departments create and administer training and development programs, and they set policies and practices with top management that govern the performance evaluation system. HR serves in a leadership capacity with responsibilities including the need to regularly communicate practices to employees, design and administer benefit programs, manage work-life conflicts, and conduct mediations, terminations, and layoffs. HR should bring an awareness of ethical issues to all stages of an individual’s experience with the organization. Knowledgeable HR professionals are therefore a great resource to all levels of the organization, from top management to managers to employees.
Managers should:
Recognize that an organization’s selection practices can identify competent candidates and accurately match them to the job and the organization. Consider assessment methods that are most likely to evaluate the skills directly needed for jobs you are looking to fill.
Use training programs for your employees to achieve direct improvement in the skills necessary to successfully complete the job. Employees who are motivated will use those skills for their greater productivity.
71

Implications for Managers (2 of 3)
Training and development programs offer ways to achieve new skill levels and thus add value to your organization. Successful training and development programs include an ethical component.
Use performance evaluations to assess an individual’s performance accurately and as a basis for allocating rewards. Make sure the performance evaluations are as fair as possible. Evaluations perceived as unfair can result in reduced effort, increases in absenteeism, or a search for another job.

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In addition, managers should:
Recognize that training and development programs offer ways to achieve new skill levels and thus add value to your organization. Successful training and development programs include an ethical component.
Use performance evaluations to assess an individual’s performance accurately and as a basis for allocating rewards. Make sure the performance evaluations are as fair as possible. As demonstrated in Chapter 7 in our discussion of equity theory, evaluations perceived as unfair can result in reduced effort, increases in absenteeism, or a search for another job.
72

Implications for Managers (3 of 3)
Give employees the opportunity to participate in their evaluations so they understand the performance criteria and engage with the improvement process.

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Finally, managers should:
Give employees the opportunity to participate in their evaluations so they understand the performance criteria and engage with the improvement process.
73

Questions?

Organizational Behavior

Eighteenth Edition, Global Edition

Chapter 17

Organizational Change and Stress Management

Learning Objectives (1 of 2)
17.1 Contrast the forces for change and planned change.
17.2 Describe ways to overcome resistance to change.
17.3 Compare the four main approaches to managing organizational change.
17.4 Demonstrate three ways of creating a culture for change.

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After studying this chapter, you should be able to:
Contrast the forces for change and planned change.
Describe ways to overcome resistance to change.
Compare the four main approaches to managing organizational change.
Demonstrate three ways of creating a culture for change.
2

Learning Objectives (2 of 2)
17.5 Identify the potential environmental, organizational, and personal sources of stress at work and the role of individual and cultural differences.
17.6 Identify the physiological, psychological, and behavioral symptoms of stress at work.
17.7 Describe individual and organizational approaches to managing stress at work.

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Additional objectives for this chapter.
Identify the potential environmental, organizational, and personal sources of stress at work and the role of individual and cultural differences.
Identify the physiological, psychological, and behavioral symptoms of stress at work.
Describe individual and organizational approaches to managing stress at work.
3

Contrast the Forces for Change and Planned Change (1 of 2)
Exhibit 17-1 Forces for Change
Force Examples
Nature of the workforce More cultural diversity
Aging population
Increased immigration and outsourcing
Technology Faster, cheaper, and more mobile computers and handheld devices
Emergence and growth of social-networking sites
Deciphering of the human genetic code
Economic shocks Rise and fall of global housing market
Financial sector collapse
Global recession
Competition Global competitors
Mergers and consolidations
Increased government regulation of commerce
Social trends Increased environmental awareness
Liberalization of attitudes toward gay, lesbian, and transgender employees
More multitasking and connectivity
World politics Rising health care costs
Negative social attitudes toward business and executives
Opening of new markets worldwide

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Organizations face a dynamic and changing environment. This requires adaptation. Exhibit 18-1 summarizes six specific forces that are acting as stimulants for change.
First is the nature of the workforce. Almost every organization must adjust to a multicultural environment, demographic changes, immigration, and outsourcing. Second, technology is changing jobs and organizations. It is not hard to imagine the very idea of an office becoming an antiquated concept in the near future. Third are economic shocks. These led to the elimination, bankruptcy, or acquisition of some of the best-known U.S. companies, including Bear Stearns, Merrill Lynch, Lehman Brothers, Countrywide Financial, Washington Mutual, and Ameriquest. Tens of thousands of jobs were lost and may never return.
The fourth force is that competition is changing. Competitors are as likely to come from across the ocean as from across town. Successful organizations will be fast on their feet, capable of developing new products rapidly and getting them to market quickly. In other words, they’ll be flexible and will require an equally flexible and responsive workforce. Fifth is the fact that social trends don’t remain static either. Consumers who are otherwise strangers now meet and share product information in chat rooms and blogs. Companies must continually adjust product and marketing strategies to be sensitive to changing social trends, as Liz Claiborne did when it sold off fashion brands (such as Ellen Tracy), deemphasized large vendors such as Macy’s, and streamlined operations and cut staff. Consumers, employees, and organizational leaders are more sensitive to environmental concerns, also, as “green” practices are quickly becoming expected rather than optional.
And last but not least is world politics. A global context for OB is required. No one could have imagined how world politics would change in recent years. We’ve seen a major set of financial crises that have rocked global markets, a dramatic rise in the power and influence of China, and dramatic shakeups in government across the Arab world. Throughout the industrialized world, businesses—particularly in the banking and financial sectors—have come under new scrutiny.
4

Contrast the Forces for Change and Planned Change (2 of 2)
Change involves making something different.
When change is an intentional, goal-oriented activity it is planned change.
There are two goals of planned change:
Improve the ability of the organization to adapt to changes in its environment.
Change employee behavior.
Change agents are those responsible for managing change activities.

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Change involves making things different. Some organizations treat all change as an accidental occurrence; however, change as an intentional, goal-oriented activity is planned change. There are two goals of planned change: one is to improve the ability of the organization to adapt to changes in its environment; the other is to change employee behavior.
Who in organizations are responsible for managing change activities, otherwise known as change agents? Change agents can be managers, employees of the organization, or outside consultants. Many change agents fail because of organizational resistance to change.
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Overcoming Resistance to Change (1 of 4)
Exhibit 17-2 Sources of Resistance to Change
Individual Sources
Habit—To cope with life’s complexities, we rely on habits or programmed responses. But when confronted with change, this tendency to respond in our accustomed ways becomes a source of resistance.
Security—People with a high need for security are likely to resist change because it threatens their feelings of safety.
Economic factors—Changes in job tasks or established work routines can arouse economic fears if people are concerned that they won’t be able to perform the new tasks or routines to their previous standards, especially when pay is closely tied to productivity.
Selective information processing—Individuals are guilty of selectively processing information in order to keep their perceptions intact. They hear what they want to hear, and they ignore information that challenges the world they’ve created.

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Change isn’t always welcome. In fact, our egos are fragile, and we often see change as threatening. These reactions can sap the organization of vital energy when it is most needed. However, resistance to change can be positive if it leads to open discussion and debate. Keep in mind though, that resistance to change does not necessarily surface in standardized ways: it can be overt, implicit, immediate, or deferred.
As shown in Exhibit 18-2, there are five individual sources of resistance.
First is individual sources habits. To cope with life’s complexities, we rely on habits or programmed responses. But when confronted with change, this tendency to respond in our accustomed ways becomes a source of resistance.
Second is security. People with a high need for security are likely to resist change because it threatens their feelings of safety.
Third are economic factors. Changes in job tasks or established work routines can arouse economic fears if people are concerned that they won’t be able to perform the new tasks or routines to their previous standards, especially when pay is closely tied to productivity.
Fourth is the fear of the unknown. Change substitutes ambiguity and uncertainty for the unknown.
And fifth is selective information processing. Individuals are guilty of selectively processing information in order to keep their perceptions intact. They hear what they want to hear, and they ignore information that challenges the world they’ve created.
There are also five major sources of organizational resistance.
First is structural inertia. Organizations have built-in mechanisms to produce stability; this structural inertia acts as a counterbalance to sustainability.
Second is limited focus of change. Organizations are made up of a number of interdependent subsystems. Changing one affects the others.
Third is group inertia. Group norms may act as a constraint.
Fourth is the threat to expertise. Changes in organizational patterns may threaten the expertise of specialized groups.
Fifth is the threat to established power relationships. Redistribution of decision-making authority can threaten long-established power relationships.
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Overcoming Resistance to Change (2 of 4)
[Exhibit 17-2 Continued]
Organizational Sources
Structural inertia—Organizations have built-in mechanisms—such as their selection processes and formalized regulations—to produce stability. When an organization is confronted with change, this structural inertia acts as a counterbalance to sustain stability.
Limited focus of change—Organizations consist of a number of interdependent subsystems. One can’t be changed without affecting the others. So limited changes in subsystems tend to be nullified by the larger system.
Group inertia—Even if individuals want to change their behavior, group norms may act as a constraint.
Threat to expertise—Changes in organizational patterns may threaten the expertise of specialized groups.
Threat to established power relationships—Any redistribution of decision-making authority can threaten long-established power relationships within the organization.

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Change isn’t always welcome. In fact, our egos are fragile, and we often see change as threatening. These reactions can sap the organization of vital energy when it is most needed. However, resistance to change can be positive if it leads to open discussion and debate. Keep in mind though, that resistance to change does not necessarily surface in standardized ways: it can be overt, implicit, immediate, or deferred.
As shown in Exhibit 18-2, there are five individual sources of resistance.
First is individual sources habits. To cope with life’s complexities, we rely on habits or programmed responses. But when confronted with change, this tendency to respond in our accustomed ways becomes a source of resistance.
Second is security. People with a high need for security are likely to resist change because it threatens their feelings of safety.
Third are economic factors. Changes in job tasks or established work routines can arouse economic fears if people are concerned that they won’t be able to perform the new tasks or routines to their previous standards, especially when pay is closely tied to productivity.
Fourth is the fear of the unknown. Change substitutes ambiguity and uncertainty for the unknown.
And fifth is selective information processing. Individuals are guilty of selectively processing information in order to keep their perceptions intact. They hear what they want to hear, and they ignore information that challenges the world they’ve created.
There are also five major sources of organizational resistance.
First is structural inertia. Organizations have built-in mechanisms to produce stability; this structural inertia acts as a counterbalance to sustainability.
Second is limited focus of change. Organizations are made up of a number of interdependent subsystems. Changing one affects the others.
Third is group inertia. Group norms may act as a constraint.
Fourth is the threat to expertise. Changes in organizational patterns may threaten the expertise of specialized groups.
Fifth is the threat to established power relationships. Redistribution of decision making authority can threaten long-established power relationships.
7

Overcoming Resistance to Change (3 of 4)
Overcoming Resistance to Change
Communication
Participation
Building support and commitment
Develop positive relationships
Implementing changes fairly
Manipulation and cooptation
Selecting people who accept change
Coercion

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Eight tactics can help change agents deal with resistance to change.
First, resistance to change can be reduced through communicating to help employees see the logic of a change. It fights the effects of misinformation and poor communication: if employees receive the full facts and clear up misunderstandings, resistance should subside.
Second, it is difficult for individuals to resist a change decision in which they participated. Prior to making a change, those opposed can be brought into the decision process, assuming they have the expertise to make a meaningful contribution. Keep in mind, though, that this creates the potential for a poor solution and great time consumption.
When employees’ fear and anxiety are high, counseling and therapy, new-skills training, or a short paid leave of absence may facilitate adjustment.
When managers or employees have low emotional commitment to change, they favor the status quo and resist it. So firing up employees can also help them emotionally commit to the change rather than embrace the status quo.
People are more willing to accept changes if they trust the managers implementing them. Research suggests that if managers are able to facilitate positive relationships, they may be able to overcome resistance to change even among those who ordinarily don’t like changes.
One way organizations can minimize negative impact is to make sure change is implemented fairly. As we saw in Chapter 7, procedural fairness is especially important when employees perceive an outcome as negative, so it’s crucial that employees see the reason for the change and perceive its implementation as consistent and fair.
Manipulation refers to covert influence attempts, twisting and distorting facts to make them appear more attractive, withholding undesirable information, and creating false rumors to get employees to accept a change. Cooptation is a form of both manipulation and participation. It seeks to “buy off” the leaders of a resistance group by giving them a key role in the change decision. Both manipulation and cooptation are relatively inexpensive and easy ways to gain support. The tactics can backfire if the targets become aware that they are being tricked or used.
Research suggests the ability to easily accept and adapt to change is related to personality—some people simply have more positive attitudes about change than others. In addition, an impressive body of evidence shows organizations can facilitate change by selecting people predisposed to accept it. Besides selecting individuals who are willing to accept changes, it is also possible to select teams that are more adaptable.
Last on the list of tactics is coercion, the application of direct threats or force on the resisters. If management really is determined to close a manufacturing plant whose employees don’t acquiesce to a pay cut, the company is using coercion. Other examples are threats of transfer, loss of promotions, negative performance evaluations, and a poor letter of recommendation. The advantages and drawbacks of coercion are approximately the same as for manipulation and cooptation.
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Overcoming Resistance to Change (4 of 4)
The Politics of Change
Change threatens the status quo, making it an inherently political activity.
Politics suggests the impetus for change is more likely to come from:
Outside change agents.
Employees new to the organization who have less invested in the status quo.
Managers slightly removed from the main power structure.

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When considering the politics of change, the first observation is that change threatens the status quo, making it an inherently political activity. Politics suggests the impetus for change is more likely to come from outside change agents, employees new to the organization (who have less invested in the status quo), or managers slightly removed from the main power structure.
Managers who have spent their entire careers with a single organization and eventually achieve a senior position in the hierarchy are often major impediments to change. Change itself is a very real threat to their status and position, yet, they may be expected to implement changes. By acting as change agents, they can convey to stockholders, suppliers, employees, and customers that they are addressing problems and adapting to a dynamic environment.
Of course, as you might guess, when forced to introduce change, these longtime power holders tend to implement incremental changes. Radical change is too threatening. This explains why boards of directors that recognize the imperative for rapid and radical change frequently turn to outside candidates for new leadership.
9

Approaches to Managing Organizational Change (1 of 7)
Approaches to managing change:
Lewin’s Three-Step Model (Exhibit 18-3)
Kotter’s Eight-Step Plan for Implementing Change (Exhibit 18-5)
Action Research
Organizational Development

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The four main approaches to managing change are Lewin’s Three-Step Model (Exhibit 18-3), Kotter’s Eight-Step Plan for Implementing Change (Exhibit 18-5), Action Research, and Organizational Development. Let’s look at each of them.
10

Approaches to Managing Organizational Change (2 of 7)
Exhibit 17-3 Lewin’s Three-Step Change Model

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In Lewin’s Three-Step Model, shown here in Exhibit 18-3, he argued that successful change in organizations should follow three steps.
Unfreezing the status quo.
Movement to a new state.
Refreezing the new change to make it permanent.
The status quo can be considered to be an equilibrium state.
11

Approaches to Managing Organizational Change (3 of 7)
Exhibit 17-4 Unfreezing the Status Quo

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To move from this equilibrium—to overcome the pressures of both individual resistance and group conformity—unfreezing is necessary as shown here in Exhibit 18-4. The driving forces, which direct behavior away from the status quo, can be increased. The restraining forces, which hinder movement from the existing equilibrium, can be decreased. A third alternative is to combine the first two approaches.
Companies that have been successful in the past are likely to encounter restraining forces because people question the need for change. Similarly, research shows that companies with strong cultures excel at incremental change but are overcome by restraining forces against radical change.
Once the change has been implemented, the new situation needs to be refrozen so that it can be sustained over time. Unless this last step is taken, there is a very high chance that the change will be short-lived and that employees will attempt to revert to the previous equilibrium state. The objective of refreezing is to stabilize the new situation by balancing the driving and restraining forces.

Approaches to Managing Organizational Change (4 of 7)
Exhibit 17-5 Kotter’s Eight-Step Plan for Implementing Change
1. Establish a sense of urgency by creating a compelling reason for why change is needed.
2. Form a coalition with enough power to lead the change.
3. Create a new vision to direct the change and strategies for achieving the vision.
4. Communicate the vision throughout the organization.
5. Empower others to act on the vision by removing barriers to change and encouraging risk taking and creative problem solving.
6. Plan for, create, and reward short-term “wins” that move the organization toward the new vision.
7. Consolidate improvements, reassess changes, and make necessary adjustments in the new programs.
8. Reinforce the changes by demonstrating the relationship between new behaviors and organizational success.

Source: Based on J. Kotter, Leading Change (Boston, MA: Harvard Business School, 1996).

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Kotter’s Eight-Step Plan for Implementing Change is illustrated here in Exhibit 18-5.
John Kotter of the Harvard Business School built on Lewin’s three-step model to create a more detailed approach for implementing change. Kotter began by listing common mistakes managers make when trying to initiate change. They may fail to create a sense of urgency about the need for change, to create a coalition for managing the change process, to have a vision for change and effectively communicate it, to remove obstacles that could impede the vision’s achievement, to provide short-term and achievable goals, and to anchor the changes into the organization’s culture. They may also declare victory too soon.
Kotter then established eight sequential steps to overcome these problems. Notice how Kotter’s first four steps essentially extrapolate Lewin’s “unfreezing” stage. Steps 5–7 represent “movement,” and the final step works on “refreezing.” So, Kotter’s contribution lies in providing managers and change agents with a more detailed guide for successfully implementing change.
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Approaches to Managing Organizational Change (5 of 7)
Action research: a change process based on the systematic collection of data and selection of a change action based on what the analyzed data indicate.
Five steps: Diagnosis, Analysis, Feedback, Action, and Evaluation.
Provides at least two specific benefits:
It is problem-focused.
It reduces resistance to change.

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Action research is a change process based on the systematic collection of data and then selection of a change action based on what the analyzed data indicate. The process consists of five steps: diagnosis, analysis, feedback, action, and evaluation. These steps closely parallel the scientific method.
Diagnosis begins by gathering information about problems, concerns, and needed changes from members of the organization. Analysis of information is synthesized into primary concerns, problem areas, and possible actions. Action research includes extensive involvement of the people who will be involved in the change program, so feedback requires sharing with employees what has been found from steps one and two and the development of a plan for the change. Action is the step where the change agent and employees set into motion the specific actions to correct the problems that were identified, and evaluation is the final step to assess the action plan’s effectiveness. Using the initial data gathered as a benchmark, any subsequent changes can be compared and evaluated.
Action research provides at least two specific benefits for an organization. First, it is problem-focused: the change agent objectively looks for problems and the type of problem determines the type of change of action. Second, resistance to change is reduced: once employees have actively participated in the feedback stage, the change process typically takes on a momentum of its own.
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Approaches to Managing Organizational Change (6 of 7)
Organizational development (OD): a collection of change methods that try to improve organizational effectiveness and employee well-being.
OD methods value human and organizational growth, collaborative and participative processes, and a spirit of inquiry.
Focuses on how individuals make sense of their work environment.

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Organizational development (OD) is a collection of change methods that try to improve organizational effectiveness and employee well-being. The OD methods value human and organizational growth, collaborative and participative processes, and a spirit of inquiry. Contemporary OD borrows heavily from postmodern philosophy in placing heavy emphasis on the subjective ways in which people see their environment. The focus is on how individuals make sense of their work environment. The change agent may take the lead in OD, but there is a strong emphasis on collaboration.
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Approaches to Managing Organizational Change (7 of 7)
The six interventions for change agents are:
Sensitivity training
Survey feedback
Process consultation (PC)
Team building
Intergroup development
Appreciative inquiry (AI)

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There are six interventions that change agents might consider using. They are: sensitivity training, survey feedback, process consultation (PC), team building, intergroup development, and appreciative inquiry (AI).
Sensitivity training can go by a variety of names including laboratory training, groups, or T-groups (training groups)—but all refer to a thorough, unstructured group interaction wherein participants discuss themselves and their interactive processes, loosely directed by a professional behavioral scientist. Survey’s generally probe perceptions held by employees. Everyone can participate in survey feedback, in which a questionnaire is usually completed by a manager and all of his or her subordinates. Data from the survey are calculated for an individual’s “family” (work group). Feedback and discussions should lead to implications.
Third is process consultation (PC). An outside consultant works with clients to understand the process events managers must deal with, and then coaches his or her client through the problem. This is similar to sensitivity training in its assumption that interpersonal involvement is important to highlight. Next is team building, which uses high-interaction group activities to increase trust and openness among team members, improve coordinative efforts, and increase team performance. Team building typically includes goal-setting, development of interpersonal relations among team members, role analysis to clarify each member’s role and responsibilities, and team process analysis.
Fifth is intergroup development. Since a major area of concern in OD is dysfunctional conflict among groups, intergroup development seeks to change groups’ attitudes, stereotypes, and perceptions about each other. Here, training sessions closely resemble diversity training (in fact, diversity training largely evolved from intergroup development in OD), except rather than focusing on demographic differences, they focus on differences among occupations, departments, or divisions within an organization.
Last is appreciative inquiry (AI), or participation. This type of OD brings to light the positive, rather than the conflict. AI asks participants to look forward and project the future based on the positive components of an organization. The AI process consists of four steps—discovery, dreaming, design, and
destiny—often played out in a large-group meeting over a 2- or 3-day time period and overseen by a trained change agent.
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Creating a Culture for Change (1 of 8)
Managing a Paradox
There is no such thing as a separate discipline of “change management” because all management is dealing with constant change and adaptation.
Learning
Organizing
Performing
Belonging
Managers can learn a few lessons from paradox theory, which states the key paradox in management is that there is no final optimal status for an organization.

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We’ve considered how organizations can adapt to change. But recently, some OB scholars have focused on a more proactive approach—how organizations can embrace change by transforming their cultures. In this section, we review three such approaches: managing a paradox, stimulating an innovative culture, and creating a learning organization.
Let’s begin with managing a paradox. In a paradox situation, we are required to balance tensions across various courses of action. There is a constant process of finding a balancing point, a dynamic equilibrium, among shifting priorities over time. From this perspective, there is no such thing as a separate discipline of “change management” because all management is dealing with constant change and adaptation.
The idea of paradox sounds abstract, but more specific concepts have begun to emerge from a growing body of research. Several key paradoxes have been identified. Learning is a paradox because it requires building on the past while rejecting it at the same time. Organizing is a paradox because it calls for setting direction and leading while requiring empowerment and flexibility. Performing is a paradox between creating organization-wide goals to concentrate effort and recognizing the diverse goals of stakeholders inside and outside the organization. And finally, belonging is a paradox between establishing a sense of collective identity and acknowledging our desire to be recognized and accepted as unique individuals.
Managers can learn a few lessons from paradox theory, which states the key paradox in management is that there is no final optimal status for an organization. The first lesson is that as the environment and members of the organization change, different elements take on more or less importance. There is some evidence that managers who think holistically and recognize the importance of balancing paradoxical factors are more effective, especially in generating adaptive and creative behavior in those they are managing.
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Creating a Culture for Change (2 of 8)
Stimulating a Culture of Innovation
Innovation: a more specialized kind of change, is a new idea applied to initiating or improving a product, process, or services.
Innovations can range from small incremental improvements, such as netbook computers, to radical breakthroughs, such as Nissan’s electric Leaf car.

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Innovation, a more specialized kind of change, is a new idea applied to initiating or improving a product, process, or services. All innovations imply change, but not all changes necessarily introduce new ideas or lead to significant improvements. Innovations can range from small incremental improvements, such as netbook computers, to radical breakthroughs, such as Nissan’s electric Leaf car.
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Creating a Culture for Change (3 of 8)
Sources of Innovation:
Structural variables are the most studied potential source of innovation.
Organic structures positively influence innovation.
Innovation-contingent rewards positively influence integration.
Innovation is nurtured when there are slack resources.
Inter-unit communication is high in innovative organizations.

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The sources of innovation are varied. Structural variables are the most studied potential source of innovation. First, organic structures positively influence innovation because they facilitate flexibility, adaptation and cross-fertilization. Second, innovation-contingent rewards positively influence innovation – when creativity is rewarded, firms tend to become more innovative—especially when employees are given feedback on their performance in addition to autonomy in doing their jobs. Third, innovation is nurtured where there are slack resources. And finally, inter-unit communication is high in innovative organizations – there is a high use of committees, task forces, cross-functional teams, and other mechanisms that facilitate interaction.
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Creating a Culture for Change (4 of 8)
Innovative organizations tend to have similar cultures:
They encourage experimentation.
They reward both successes and failures.
They celebrate mistakes.
Managers in innovative organizations recognize that failures are a natural by-product of venturing into the unknown.

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Innovative organizations tend to have similar cultures. They encourage experimentation, reward both successes and failures, and celebrate mistakes. Managers in innovative organizations recognize that failures are a natural by-product of venturing into the unknown.
20

Creating a Culture for Change (5 of 8)
Innovative organizations:
Actively promote the training and development of their members so they keep current.
Offer high job security so employees don’t fear getting fired for making mistakes.
Encourage individuals to become champions of change.
Once a new idea is developed, idea champions actively and enthusiastically promote it, build support, overcome resistance, and ensure it’s implemented.

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Within the human resources category, innovative organizations actively promote the training and development of their members so they keep current, offer high job security so employees don’t fear getting fired for making mistakes, and encourage individuals to become champions of change. Once a new idea is developed, idea champions actively and enthusiastically promote it, build support, overcome resistance, and ensure it’s implemented.
Champions have common personality characteristics: extremely high self-confidence, persistence, energy, and a tendency to take risks. They also display characteristics associated with transformational leadership—they inspire and energize others with their vision of an innovation’s potential and their strong personal conviction about their mission. They are also good at gaining the commitment of others. Idea champions have jobs that provide considerable decision-making discretion; this autonomy helps them introduce and implement innovations. People in collectivist cultures prefer appeals for cross-functional support for innovation efforts; people in high power distance cultures prefer champions to work closely with those in authority to approve innovative activities before work is begun; and the higher the uncertainty avoidance of a society, the more champions should work within the organization’s rules and procedures to develop the innovation. These findings suggest that effective managers will alter their organization’s championing strategies to reflect cultural values. So, for instance, although idea champions in Russia might succeed by ignoring budgetary limitations and working around confining procedures, champions in Austria, Denmark, Germany, or other cultures high in uncertainty avoidance will be more effective by closely following budgets and procedures.
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Creating a Culture for Change (6 of 8)
Exhibit 17-6 Characteristics of a Learning Organization
1. There exists a shared vision that everyone agrees on.
2. People discard their old ways of thinking and the standard routines they use for solving problems or doing their jobs.
3. Members think of all organizational processes, activities, functions, and interactions with the environment as part of a system of interrelationships.
4. People openly communicate with each other (across vertical and horizontal boundaries) without fear of criticism or punishment.
5. People sublimate their personal self-interest and fragmented departmental interests to work together to achieve the organization’s shared vision.

Source: Based on P. M. Senge, The Fifth Discipline: The Art and Practice of the Learning Organization, 2nd ed. (New York: Random House, 2006).

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A learning organization is an organization that has developed the continuous capacity to adapt and change. All organizations learn, whether they consciously choose to or not; it is a fundamental requirement for their sustained existence.
Exhibit 18-6 summarizes the five basic characteristics of a learning organization. It’s one in which people put aside their old ways of thinking, learn to be open with each other, understand how their organization really works, form a plan or vision everyone can agree on, and work together to achieve that vision.
Proponents of the learning organization envision it as a remedy for three fundamental problems of traditional organizations: fragmentation, competition, and reactiveness. First, fragmentation based on specialization creates “walls” and “chimneys” that separate different functions into independent and often warring fiefdoms. Second, an overemphasis on competition often undermines collaboration. Managers compete to show who is right, who knows more, or who is more persuasive. Divisions compete when they ought to cooperate and share knowledge. Team leaders compete to show who the best manager is. And third, reactiveness misdirects management’s attention to problem solving rather than creation. The problem solver tries to make something go away, while a creator tries to bring something new into being. An emphasis on reactiveness pushes out innovation and continuous improvement and, in its place, encourages people to run around “putting out fires.”
22

Creating a Culture for Change (7 of 8)
What can managers do to make their firms learning organizations?
Establish a strategy.
Redesign the organization’s structure.
Reshape the organization’s culture.

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What can managers do to make their firms learning organizations? First, establish a strategy. Management needs to make explicit its commitment to change, innovation, and continuous improvement. Second, redesign the organization’s structure. The formal structure can be a serious impediment to learning. Flattening the structure, eliminating or combining departments, and increasing the use of cross-functional teams reinforces interdependence and reduces boundaries. Third, reshape the organization’s culture. To become a learning organization, managers must demonstrate by their actions that taking risks and admitting failures are desirable. That means rewarding people who take chances and make mistakes. And management needs to encourage functional conflict. “The key to unlocking real openness at work,” says one expert on learning organizations, “is to teach people to give up having to be in agreement. You have to bring paradoxes, conflicts, and dilemmas out in the open, so collectively we can be more intelligent than we can be individually.”
23

Creating a Culture for Change (8 of 8)
Organizational Change and Stress
Research shows that organizational changes incorporating OB knowledge of how people react to stressors may yield more effective results than organizational changes that are only objectively managed through goal-setting.
The role of leadership is critical.
Changes are stressful because employees perceive aspects to be threatening.
Employees need to see the changes as fair.

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Researchers are increasingly studying the effects of organizational change on employees. We are interested in determining the specific causes and mitigating factors of stress in order to learn how to manage organizational change effectively. The overall findings are that organizational changes incorporating OB knowledge of how people react to stressors may yield more effective results than organizational changes that are only objectively managed through goal-setting. Not surprisingly, the role of leadership is critical. A recent study found that transformational leaders can help shape employee affect so employees stay committed to the change and do not perceive it as stressful. Another study indicated that a positive orientation toward change before specific changes are planned will predict how employees deal with new initiatives.
Often, organizational changes are stressful because employees perceive aspects of the changes as threatening. These employees are more likely to quit, partially in reaction to their stress. To reduce the perception of threat, employees need to see the organizational changes as fair. Research indicates that those who have a positive change orientation before changes are planned are less likely to perceive of changes as unfair or threatening.
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Stress at Work (1 of 4)
Exhibit 17-7 Work Is a Top Source of Stress
What area of your life causes you the most stress? Blank
Area Causes Most Stress
Financial worries 64%
Work 60%
Family responsibilities 47%
Health concerns 46%

Source: Based on “Stress in America: Paying with Our Health,” American Psychological Association, February 4, 2015, http://www.apa.org/news/press/releases/stress/2014/stress-report .

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What is stress? Stress is a dynamic condition in which an individual is confronted with an opportunity, constraint, or demand related to what he or she desires and for which the outcome is perceived to be both uncertain and important. Exhibit 18-7 shows work is, for most people, the most important source of stress in life.
Stress is not necessarily bad in and of itself. Individuals often use stress positively to rise to the occasion and perform at or near their maximum.
Recently, researchers have argued that challenge stressors—or stressors associated with workload, pressure to complete tasks, and time urgency—operate quite differently from hindrance stressors—or stressors that keep you from reaching your goals (for example, red tape, office politics, confusion over job responsibilities, etc.). Although research is just starting to accumulate, early evidence suggests challenge stressors produce less strain than hindrance stressors.
Researchers have sought to clarify the conditions under which each type of stress exists. It appears that employees who have a stronger affective commitment to their organization can transfer psychological stress into greater focus and higher sales performance, whereas employees with low levels of commitment perform worse under stress. And when challenge stress increases, those with high levels of organizational support have higher role-based performance, but those with low levels of organizational support do not.
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Stress at Work (2 of 4)
OB POLL Many Employees Feel Extreme Stress
Source: Based on J. Hudson, “High Stress Has Employees Seeking Both Wellness and Employee Assistance Help,” ComPsych Corporation press release, November 12, 2014, http://www.compsych.com/press-room/press-releases-2014/818-nov-12-2014.

Stress at Work (3 of 4)
Exhibit 17-8 A Model of Stress from

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As the model in Exhibit 18-8 shows, there are three categories of potential stressors: environmental, organizational, and personal.
Environmental uncertainty influences stress levels among employees in an organization. Political uncertainties in some countries can be stress inducing. Technological uncertainty can cause stress because new innovations can make an employee’s skills and experience obsolete in a very short period of time.
Next are organizational factors, like pressures to avoid errors or complete tasks in a limited time period, work overload, a demanding and insensitive boss, and unpleasant coworkers. Task demands are factors related to a person’s job, including the design of the individual’s job (autonomy, task variety, degree of automation), working conditions, and the physical work layout. Role demands relate to pressures that are a function of the role an individual plays in an organization. (Role conflicts create expectations that may be hard to reconcile or satisfy. Role overload is experienced when the employee is expected to do more than time permits. Role ambiguity is created when role expectations are not clearly understood.) Interpersonal demands are pressures created by other employees. Lack of social support from colleagues and poor interpersonal relationships can cause stress, especially among employees with a high social need. A rapidly growing body of research has also shown that negative coworker and supervisor behaviors, including fights, bullying, incivility, racial harassment, and sexual harassment, are especially strongly related to stress at work.
Next are personal factors, which are factors in the employee’s personal life like family issues, personal economic problems, and inherent personality characteristics. National surveys consistently show that people hold family and personal relationships dear.
Four individual difference variables moderate the relationship between potential stressors and experienced stress: perception, job experience, social support, and personality. First, perception moderates the relationship between a potential stress condition and an employee’s reaction to it. Stress potential doesn’t lie in objective conditions; it lies in an employee’s interpretation of those conditions. Next is job experience. The evidence indicates that experience on the job tends to be negatively related to work stress. Voluntary turnover is more probable among people who experience more stress. Social support is the relationships with coworkers or supervisors that can buffer the impact of stress. Social support acts as a palliative, mitigating the negative effects of even high-strain jobs. Next is personality traits. Perhaps the most widely studied personality trait in stress is neuroticism, discussed in Chapter 5. As you might expect, neurotic individuals are more prone to experience psychological strain. Evidence suggests that neurotic individuals are more prone to believe there are stressors in their work environments, so part of the problem is that they believe their environments are more threatening. They also tend to select less adaptive coping mechanisms, relying on avoidance as a way of dealing with problems rather than attempting to resolve them. Workaholism is another personal characteristic related to stress levels. Workaholics are people obsessed with their work; they put in an enormous number of hours, think about work even when not working, and create additional work responsibilities to satisfy an inner compulsion to work more.
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Stress at Work (4 of 4)
Cultural Differences
Research suggests the job conditions that cause stress show some differences across cultures.
For example, U.S. employees are stressed by a lack of control, whereas Chinese employees are stressed by job evaluations and lack of training.
Research also shows that stress is equally bad for employees of all cultures.

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Research suggests the job conditions that cause stress show some differences across cultures. One study revealed that whereas U.S. employees were stressed by a lack of control, Chinese employees were stressed by job evaluations and lack of training.
It doesn’t appear that personality effects on stress are different across cultures, however. One study of employees in Hungary, Italy, the United Kingdom, Israel, and the United States found Type A personality traits (see Chapter 5) predicted stress equally well across the countries. A study of 5,270 managers from 20 countries found individuals from individualistic countries such as the United States, Canada, and the United Kingdom experienced higher levels of stress due to work interfering with family than did individuals from collectivist countries like Asia and Latin America. The authors proposed that this may occur because, in collectivist cultures, working extra hours is seen as a sacrifice to help the family, whereas in individualistic cultures, work is seen as a means to personal achievement that takes away from the family.
Evidence suggests that stressors are associated with perceived stress and strains among employees in different countries. In other words, stress is equally bad for employees of all cultures.
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Consequences of Stress at Work (1 of 2)
Consequences of Stress
Physiological Symptoms: research supports the link between job stress and poor health.
Psychological Symptoms: job dissatisfaction is an obvious cause of stress.
Behavioral Symptoms: reductions in productivity, absence, turnover, as well as changes in eating habits, increased smoking and/or consumption of alcohol, rapid speech, fidgeting, and sleep disorders.

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What are the consequences of stress? Symptoms of stress can be categorized as physiological, psychological, or behavioral.
Most early concern with stress was directed at physiological symptoms because most researchers were specialists in the health and medical sciences. Their work led to the conclusion that stress could create changes in metabolism, increase heart and breathing rates and blood pressure, bring on headaches, and induce heart attacks. Evidence now clearly suggests stress may have harmful physiological effects. One study linked stressful job demands to increased susceptibility to upper-respiratory illnesses and poor immune system functioning, especially for individuals with low self-efficacy. A long-term study conducted in the United Kingdom found that job strain was associated with higher levels of coronary heart disease. Still another study conducted with Danish human services workers found that higher levels of psychological burnout at the work-unit level were related to significantly higher levels of sickness absence. Many other studies have shown similar results linking work stress to a variety of indicators of poor health.
The psychological symptoms caused by stress are simple: job-related stress can cause job-related dissatisfaction, and job dissatisfaction is the simplest and most obvious psychological effect of stress. Multiple and conflicting demands—lack of clarity as to the incumbent’s duties, authority, and responsibilities—increase stress and dissatisfaction. The less control people have over the pace of their work, the greater the stress and dissatisfaction.
Next are behavioral symptoms. Research on behavior and stress has been conducted across several countries and over time, the relationships appear relatively consistent. Behavior-related stress symptoms include reductions in productivity, absence, and turnover, as well as changes in eating habits, increased smoking or consumption of alcohol, rapid speech, fidgeting, and sleep disorders. A significant amount of research has investigated the stress-performance relationship.
29

Consequences of Stress at Work (2 of 2)
Exhibit 17-9 The Proposed Inverted-U Relationship between Stress and Job Performance

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The most widely studied pattern of the relationship between stress and job performance is the inverted U, shown here in Exhibit 18-9. The logic underlying the figure is that low to moderate levels of stress stimulate the body and increase its ability to react. Individuals then often perform their tasks better, more intensely, or more rapidly. But too much stress places unattainable demands on a person, which result in lower performance. In spite of the popularity and intuitive appeal of the inverted-U model, it doesn’t get a lot of empirical support. So we should be careful of assuming it accurately depicts the stress–performance relationship.
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Managing Stress at Work (1 of 11)
Managing Stress
Because low to moderate levels of stress can be functional and lead to higher performance, management may not be concerned when employees experience stress at these levels.
What management may consider to be “a positive stimulus that keeps the adrenaline running” is very likely to be seen as “excessive pressure” by the employee.

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Because low to moderate levels of stress can be functional and lead to higher performance, management may not be concerned when employees experience them. Employees, however, are likely to perceive even low levels of stress as undesirable. It’s not unlikely, therefore, for employees and management to have different notions of what constitutes an acceptable level of stress on the job. What management may consider to be “a positive stimulus that keeps the adrenaline running” is very likely to be seen as “excessive pressure” by the employee.
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Managing Stress at Work (2 of 11)
Individual Approaches
An employee can take personal responsibility for reducing stress levels.
Individual strategies include:
Time-management techniques.
Increased physical exercise.
Relaxation training.
Expanded social support networks.

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An employee can take personal responsibility for reducing stress levels. Individual strategies that have proven effective include time-management techniques, increased physical exercise, relaxation training, and expanded social support networks.
An understanding and utilization of basic time-management principles can help individuals better cope with tensions created by job demands. A few of the best-known time-management principles are: making daily lists of activities to be accomplished; prioritizing activities by importance and urgency; scheduling activities according to the priorities set; knowing your daily cycle and handling the most demanding parts of your job when you are most alert and productive; and avoiding electronic distractions like frequently checking e-mail, which can limit attention and reduce efficiency. These time-management skills can help minimize procrastination by focusing efforts on immediate goals and boosting motivation even in the face of tasks that are less desirable.
Physicians have recommended noncompetitive physical exercise, such as aerobics, walking, jogging, swimming, and riding a bicycle, as a way to deal with excessive stress levels. These activities increase lung capacity, lower the at-rest heart rate, and provide a mental diversion from work pressures, effectively reducing work-related levels of stress.
Individuals can also teach themselves to reduce tension through relaxation techniques such as meditation, hypnosis, and deep breathing. The objective is to reach a state of deep physical relaxation, in which you focus all your energy on release of muscle tension. Deep relaxation for 15 or 20 minutes a day releases strain and provides a pronounced sense of peacefulness, as well as significant changes in heart rate, blood pressure, and other physiological factors. A growing body of research shows that simply taking breaks from work at routine intervals can facilitate psychological recovery and reduce stress significantly and may improve job performance, and these effects are even greater if relaxation techniques are employed.
As we have noted, friends, family, or work colleagues can provide an outlet when stress levels become excessive. Expanding your social support network provides someone to hear your problems and offer a more objective perspective on a stressful situation than your own.
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Managing Stress at Work (3 of 11)
Organizational Approaches
Several organizational factors that cause stress are controlled by management.
Task and role demands can be modified or changed.

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Several organizational factors that cause stress—particularly task and role demands—are controlled by management and thus can be modified or changed. Let’s look at some of the strategies that management can use.
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Managing Stress at Work (4 of 11)
Strategies include:
Better selection and placement, and training.
Goal-setting.
Redesigning jobs.
Employee involvement.
Organizational communication.
Employee sabbaticals.
Wellness programs.

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Strategies to consider include improved employee selection and job placement, training, realistic goal-setting, redesign of jobs, increased employee involvement, improved organizational communication, employee sabbaticals, and corporate wellness programs. Let’s talk more about each of these.
34

Managing Stress at Work (5 of 11)
Selection and Placement
Individuals with little experience or an external locus of control tend to be more prone to stress.
Selection and placement decisions should take these facts into consideration.
Training can increase an individual’s self-efficacy and thus lessen job strain in these situations.

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Certain jobs are more stressful than others but, as we’ve seen, individuals differ in their response to stressful situations. We know individuals with little experience or an external locus of control tend to be more prone to stress. Selection and placement decisions should take these facts into consideration. Obviously, management shouldn’t restrict hiring to only experienced individuals with an internal locus, but such individuals may adapt better to high-stress jobs and perform those jobs more effectively.
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Managing Stress at Work (6 of 11)
Goal-setting
Goals can reduce stress as well as provide motivation.
Employees who are highly committed to their goals and see purpose in their jobs experience less stress.

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We discussed goal-setting in Chapter 7. Individuals perform better when they have specific and challenging goals and receive feedback on their progress toward these goals. Goals can reduce stress as well as provide motivation. Employees who are highly committed to their goals and see purpose in their jobs experience less stress because they are more likely to perceive stressors as challenges rather than hindrances. Specific goals perceived as attainable clarify performance expectations. In addition, goal feedback reduces uncertainties about actual job performance. The result is less employee frustration, role ambiguity, and stress.
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Managing Stress at Work (7 of 11)
Redesigning Jobs
Redesigning jobs to give employees more responsibility, more meaningful work, more autonomy, and increased feedback can reduce stress because these factors give employees greater control over work activities and lessen dependence on others.

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Redesigning jobs to give employees more responsibility, more meaningful work, more autonomy, and increased feedback can reduce stress because these factors give employees greater control over work activities and lessen dependence on others. But as we noted in our discussion of work design, not all employees want enriched jobs. The right redesign for employees with a low need for growth might be less responsibility and increased specialization. If individuals prefer structure and routine, reducing skill variety should also reduce uncertainties and stress levels.
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Managing Stress at Work (8 of 11)
Employee involvement
Role stress is detrimental to a large extent because employees feel uncertain about goals, expectations, how they’ll be evaluated, and the like.
Giving employees a voice in management decisions can increase employee control and reduce role stress.
Managers should consider increasing employee involvement in decision making.

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Role stress is detrimental to a large extent because employees feel uncertain about goals, expectations, how they’ll be evaluated, and the like. By giving these employees a voice in the decisions that directly affect their job performance, management can increase employee control and reduce role stress. Thus, managers should consider increasing employee involvement in decision making, because evidence clearly shows that increases in employee empowerment reduce psychological strain.
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Managing Stress at Work (9 of 11)
Organizational Communication
Increasing formal organizational communication with employees reduces uncertainty by lessening role ambiguity and role conflict.
Given the importance that perceptions play in moderating the stress-response relationship, management can also use effective communications as a means to shape employee perceptions.

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Increasing formal organizational communication with employees reduces uncertainty by lessening role ambiguity and role conflict. Given the importance that perceptions play in moderating the stress–response relationship, management can also use effective communications as a means to shape employee perceptions. Remember that what employees categorize as demands, threats, or opportunities at work is an interpretation, and that interpretation can be affected by the symbols and actions communicated by management.
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Managing Stress at Work (10 of 11)
Employee sabbaticals
Some employees need an occasional escape from the frenetic pace of their work.
These sabbaticals—ranging in length from a few weeks to several months—allow employees to travel, relax, or pursue personal projects that consume time beyond normal vacations.

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Some employees need an occasional escape from the frenetic pace of their work. Companies including Genentech, American Express, Intel, General Mills, Microsoft, Morningstar, DreamWorks Animation, and Adobe Systems have begun to provide extended voluntary leaves. These sabbaticals—ranging in length from a few weeks to several months—allow employees to travel, relax, or pursue personal projects that consume time beyond normal vacations. Proponents say they can revive and rejuvenate workers who might otherwise be headed for burnout.
40

Managing Stress at Work (11 of 11)
Corporate wellness programs
Typically provide workshops to help people quit smoking, control alcohol use, lose weight, eat better, and develop a regular exercise program.
Focus on the employee’s total physical and mental condition.

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Our final suggestion is organizationally supported wellness programs. These typically provide workshops to help people quit smoking, control alcohol use, lose weight, eat better, and develop a regular exercise program; they focus on the employee’s total physical and mental condition. Some help employees improve their psychological health as well. A meta-analysis of 36 programs designed to reduce stress (including wellness programs) showed that interventions to help employees reframe stressful situations and use active coping strategies appreciably reduced stress levels. Most wellness programs assume employees need to take personal responsibility for their physical and mental health and that the organization is merely a means to that end.
41

Implications for Managers (1 of 3)
Consider that, as a manager, you are a change agent in your organization. The decisions you make and your role-modeling behaviors will help shape the organization’s change culture.
Your management policies and practices will determine the degree to which the organization learns and adapts to changing environmental factors.

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The need for change has been implied throughout this text. For instance, think about attitudes, motivation, work teams, communication, leadership, organizational structures, human resource practices, and organizational cultures. Change was an integral part in our discussion of each. If environments were perfectly static, if employees’ skills and abilities were always up to date and incapable of deteriorating, and if tomorrow were always exactly the same as today, organizational change would have little or no relevance to managers. But the real world is turbulent, requiring organizations and their members to undergo dynamic change if they are to perform at competitive levels. Coping with all these changes can be a source of stress, but with effective management, challenge can enhance engagement and fulfillment, leading to the high performance that, as you’ve discovered in this text, is one major goal of the study of organizational behavior (OB).
Managers should:
Consider that, as a manager, you are a change agent in your organization. The decisions you make and your role-modeling behaviors will help shape the organization’s change culture.
Your management policies and practices will determine the degree to which the organization learns and adapts to changing environmental factors.
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Implications for Managers (2 of 3)
Some stress is good. Increasing challenges brought by autonomy and responsibility at work will lead to some stress, but they will also increase feelings of accomplishment and fulfillment. Hindrance stressors like bureaucracy and interpersonal conflicts, on the other hand, are entirely negative and should be eliminated.

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In addition, managers should know:
Some stress is good. Increasing challenges brought by autonomy and responsibility at work will lead to some stress, but they will also increase feelings of accomplishment and fulfillment. Hindrance stressors like bureaucracy and interpersonal conflicts, on the other hand, are entirely negative and should be eliminated.
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Implications for Managers (3 of 3)
You can help alleviate harmful workplace stress for your employees by accurately matching work-loads to employees, providing employees with stress-coping resources, and responding to employee concerns.
You can identify extreme stress in your employees when performance declines, turnover increases, health-related absenteeism increases, and engagement declines. Stay alert for early indicators and be proactive.

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Finally:
You can help alleviate harmful workplace stress for your employees by accurately matching work-loads to employees, providing employees with stress-coping resources, and responding to their concerns.
You can identify extreme stress in your employees when performance declines, turnover increases, health-related absenteeism increases, and engagement declines. However, by the time these symptoms are visible, it may be too late to be helpful, so stay alert for early indicators and be proactive.
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Questions?

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Organizational Behavior
Eighteenth Edition, Global Edition
Chapter 18
Conflict and Negotiation
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Learning Objectives
18.1 Describe the three types of conflict and the three loci of conflict.
18.2 Outline the conflict process.
18.3 Contrast distributive and integrative bargaining.
18.4 Apply the five steps of the negotiation process.
18.5 Show how individual differences influence negotiations.
18.6 Assess the roles and functions of third-party negotiations.

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After studying this chapter, you should be able to:
Describe the three types of conflict and the two loci of conflict.
Outline the conflict process.
Contrast distributive and integrative bargaining.
Apply the five steps of the negotiation process.
Show how individual differences influence negotiations.
Assess the roles and functions of third-party negotiations.
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Three Types of Conflict and Three Loci of Conflict (1 of 5)
Conflict: a process that begins when one party perceives that another party has negatively affected, or is about to negatively affect, something that the first party cares about.
If no one is aware of a conflict, then it is generally agreed no conflict exists.
Also needed to begin the conflict process are opposition or incompatibility and interaction.

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We define conflict as a process that begins when one party perceives that another party has negatively affected, or is about to negatively affect, something that the first party cares about. Common to most is the idea that conflict is a perception. If no one is aware of a conflict, then it is generally agreed no conflict exists. Also needed to begin the conflict process are opposition or incompatibility and interaction.
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Three Types of Conflict and Three Loci of Conflict (2 of 5)
Contemporary perspectives differentiate types of conflict based on their effects.
Functional conflict supports the goals of the group and improves its performance.
Conflicts that hinder group performance are dysfunctional or destructive forms of conflict.

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Contemporary perspectives differentiate types of conflict based on their effects. Functional conflict supports the goals of the group and improves its performance. Conflicts that hinder group performance are dysfunctional or destructive forms of conflict.
51

Three Types of Conflict and Three Loci of Conflict (3 of 5)
Exhibit 18-1 Conflict and Unit Performance from

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Exhibit 14-1 provides an overview of the effect of levels of conflict. Next, we’ll discuss the types of conflict and the loci of conflict.
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Three Types of Conflict and Three Loci of Conflict (4 of 5)
Types of Conflict
Researchers have classified conflicts into three categories:
Task conflict relates to the content and goals of the work.
Relationship conflict focuses on interpersonal relationships.
Process conflict is about how the work gets done.

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Researchers have classified conflicts into three categories: task, relationship, or process. Task conflict relates to the content and goals of the work. Relationship conflict focuses on interpersonal relationships. Process conflict is about how the work gets done.
Studies demonstrate that relationship conflicts, at least in work settings, are almost always dysfunctional. It appears that the friction and interpersonal hostilities inherent in relationship conflicts increase personality clashes and decrease mutual understanding, which hinders the completion of organizational tasks.
Of the three types, relationship conflicts also appear to be the most psychologically exhausting to individuals. This type of conflict can also be very problematic for employees who are new to the organization, since newcomers rely on coworkers to learn information about the job.
While scholars agree that relationship conflict is dysfunctional, there is considerably less agreement as to whether task and process conflicts are functional.
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Three Types of Conflict and Three Loci of Conflict (5 of 5)
Loci of Conflict
Another way to understand conflict is to consider its locus, or where the conflict occurs.
There are three basic types:
Dyadic conflict is conflict between two people.
Intragroup conflict occurs within a group or team.
Intergroup conflict is conflict between groups or teams.

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Another way to understand conflict is to consider its locus, or where the conflict occurs. Here, too, there are three basic types: dyadic conflict is conflict between two people; intragroup conflict occurs within a group or team; and intergroup conflict is conflict between groups or teams.
Nearly all the literature on task, relationship, and process conflict considers intragroup conflict (within the group). That makes sense given that groups and teams often exist only to perform a particular task. However, it doesn’t necessarily tell us about the other loci of conflict. Another intriguing question about loci is whether conflicts interact or buffer one another. Intense intergroup conflict can be quite stressful to group members and might well affect the way they interact. Thus, understanding functional and dysfunctional conflict requires not only that we identify the type of conflict; we also need to know where it occurs.
54

Outline the Conflict Process (1 of 10)
Exhibit 18-2 The Conflict Process

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The conflict process has five stages: potential opposition or incompatibility, cognition and personalization, intentions, behavior, and outcomes.
As shown in Exhibit 14-2, in Stage I, potential opposition or incompatibility is present. Here, communication as a source of conflict represents those opposing forces that arise from semantic difficulties, misunderstandings, and “noise” in the communication channels. The potential for conflict increases when either too little or too much communication takes place. The term structure includes variables such as size, degree of specialization, jurisdictional clarity, member-goal compatibility, leadership styles, reward systems, and the degree of dependence. Personal variables include personality, emotions, and values. People high in the personality traits of disagreeableness, neuroticism, or self-monitoring are prone to tangle with other people more often, and to react poorly when conflicts occur. Emotions can also cause conflict even when they are not directed at others.
In Stage II, the potential for opposition or incompatibility becomes actualized. Because a disagreement is a perceived conflict, however, does not mean it is personalized. It is at the felt conflict level, when individuals become emotionally involved, that they experience anxiety, tension, frustration, or hostility. Stage II is important for two reasons: because it’s where conflict issues tend to be defined, where the parties decide what the conflict is about; and because emotions play a major role in shaping perceptions and therefore our reactions to the conflict.
55

Three Types of Conflict and Three Loci of Conflict (3 of 10)
Intentions: decisions to act in a given way.
Competing
Collaborating
Avoiding
Accommodating
Compromising

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Stage III involves intentions, or decisions to act in a given way that intervene between people’s perceptions and emotions and their overt behavior. Why are intentions separated out as a distinct stage? Merely one party attributing the wrong intentions to the other escalates a lot of conflicts. One way to identify the primary conflict-handling intentions is to think about them along two dimensions. First is cooperativeness or the degree to which one party attempts to satisfy the other party’s concerns. Second is assertiveness, which is the degree to which one party attempts to satisfy his or her own concerns.
Five conflict-handling intentions can be identified: competing, collaborating, avoiding, accommodating, and compromising. Keep in mind that intentions are not always fixed. They might change because of reconceptualization or because of an emotional reaction. However, individuals have preferences among the five conflict-handling intentions.
56

Outline the Conflict Process (4 of 10)
Exhibit 18-3 Conflict-Intensity Continuum

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Stage IV is where conflicts become visible. The behavior stage includes the statements, actions, and reactions made by the conflicting parties. These conflict behaviors are usually overt attempts to implement each party’s intentions. At the lower part of the continuum, conflicts are characterized by subtle, indirect, and highly controlled forms of tension. Conflict intensities escalate as they move upward along the continuum until they become highly destructive. If a conflict is dysfunctional, what can the parties do to de-escalate it? Or, conversely, what options exist if conflict is too low and needs to be increased?
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Outline the Conflict Process (5 of 10)
Exhibit 18-4 Conflict Management Techniques
Conflict-Resolution Techniques Blank
Problem solving Meeting face to face for the purpose of identifying the problem and resolving it through open discussion.
Superordinate goals Creating a shared goal that cannot be attained without the cooperation of each of the conflicting parties.
Expansion of resources Expanding the supply of a scarce resource (for example, money, promotion, opportunities, office space).
Avoidance Withdrawing from or suppressing the conflict.
Smoothing Playing down differences while emphasizing common interests between the conflicting parties.
Compromise Having each party to the conflict give up something of value.
Authoritative command Letting management use its formal authority to resolve the conflict and then communicating its desires to the parties involved.
Altering the human variable Using behavioral change techniques such as human relations training to alter attitudes and behaviors that cause conflict.
Altering the structural variables Changing the formal organization structure and the interaction patterns of conflicting parties through job redesign, transfers, creation of coordinating positions, and the like.

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This brings us to techniques of conflict management. Exhibit 14-5 lists the major resolution and stimulation techniques that allow managers to control conflict levels. Under ideal conditions, a person’s intentions should translate into comparable behaviors.
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Outline the Conflict Process (6 of 10)
[Exhibit 18-4 Continued]
Conflict-Stimulation Techniques Blank
Communication Using ambiguous or threatening messages to increase conflict levels.
Bringing in outsiders Adding employees to a group whose backgrounds, values, attitudes, or managerial styles differ from those of present members.
Restructuring the organization Realigning work groups, altering rules and regulations, increasing interdependence, and making similar structural changes to disrupt the status quo.
Appointing a devil’s advocate Designating a critic to purposely argue against the majority positions held by the group.

Source: Based on S. P. Robbins, Managing Organizational Conflict: A Nontraditional Approach (Upper Saddle River, NJ: Prentice Hall, 1974): 59–89.

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The continuation of Exhibit 14-5 shows the remainder of the major resolution and stimulation techniques that allow managers to control conflict levels. Recall that under ideal conditions, a person’s intentions should translate into comparable behaviors.
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Outline the Conflict Process (7 of 10)
Stage V: Outcomes
Conflict is constructive when it…
Improves the quality of decisions, stimulates creativity and innovation, encourages interest and curiosity, provides the medium through which problems can be aired and tensions released, and fosters an environment of self-evaluation and change.
Conflict is destructive when it…
Breeds discontent, reduces group effectiveness, and threatens the group’s survival.

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Outcomes, which is Stage V of Exhibit 14-2, may be functional, that is, improving group performance, or dysfunctional in hindering it.
Conflict is constructive when it improves the quality of decisions, when it stimulates creativity and innovation, when it encourages interest and curiosity, when it provides the medium through which problems can be aired and tensions released, and when it fosters an environment of self-evaluation and change. Conflict can improve the quality of decision making. Conflict is an antidote for groupthink. Conflict challenges the status quo, furthers the creation of new ideas, promotes reassessment of group goals and activities, and increases the probability that the group will respond to change.
The destructive consequences of conflict on the performance of a group or an organization are generally well known: Uncontrolled opposition breeds discontent, which acts to dissolve common ties and eventually leads to the destruction of the group. And, of course, a substantial body of literature documents how dysfunctional conflicts can reduce group effectiveness. Among the undesirable consequences are poor communication, reductions in group cohesiveness, and subordination of group goals to the primacy of infighting among members. All forms of conflict—even the functional varieties—appear to reduce group member satisfaction and trust. When active discussions turn into open conflicts between members, information sharing between members decreases significantly. At the extreme, conflict can bring group functioning to a halt and threaten the group’s survival.
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Outline the Conflict Process (8 of 10)
Managing Functional Conflict
One of the keys to minimizing counterproductive conflicts is recognizing when there really is a disagreement.
Many apparent conflicts are due to people using different language to discuss the same general course of action.
Successful conflict management recognizes these different approaches.
Attempts to resolve them by encouraging open, frank discussion focused on interests rather than issues.

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Managing functional conflict isn’t easy. But, if managers recognize that in some situations conflict can be beneficial, what can they do to manage conflict effectively in their organizations?
One of the keys to minimizing counterproductive conflicts is recognizing when there really is a disagreement. Many apparent conflicts are due to people using different language to discuss the same general course of action. For example, someone in marketing might focus on “distribution problems,” while someone from operations will talk about “supply chain management” to describe essentially the same issue. Successful conflict management recognizes these different approaches and attempts to resolve them by encouraging open, frank discussion focused on interests rather than issues (we’ll have more to say about this when we contrast distributive and integrative bargaining styles).
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Outline the Conflict Process (9 of 10)
Groups that resolve conflicts successfully discuss differences of opinion openly.
The most disruptive conflicts are those that are never addressed directly.
Managers need to emphasize shared interests in resolving conflicts.
Groups with cooperative conflict styles and an underlying identification to group goals are more effective than groups with a more competitive style.

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Groups that resolve conflicts successfully discuss differences of opinion openly and are prepared to manage conflict when it arises.
The most disruptive conflicts are those that are never addressed directly. An open discussion makes it much easier to develop a shared perception of the problems at hand; it also allows groups to work toward a mutually acceptable solution.
Managers need to emphasize shared interests in resolving conflicts, so groups that disagree with one another don’t become too entrenched in their points of view and start to take the conflicts personally. Groups with cooperative conflict styles and a strong underlying identification to the overall group goals are more effective than groups with a more competitive style.
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Outline the Conflict Process (10 of 10)
Differences across countries in conflict resolution strategies may be based on collectivistic tendencies and motives.
Collectivist cultures see people as deeply embedded in social situations.
They will avoid direct expression of conflicts, preferring indirect methods for resolving differences of opinion.

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Differences across countries in conflict resolution strategies may be based on collectivistic tendencies and motives. Collectivist cultures see people as deeply embedded in social situations, whereas individualist cultures see them as autonomous. As a result, collectivists are more likely to seek to preserve relationships and promote the good of the group as a whole. They will avoid direct expression of conflicts, preferring indirect methods for resolving differences of opinion. Collectivists may also be more interested in demonstrations of concern and working through third parties to resolve disputes, whereas individualists will be more likely to confront differences of opinion directly and openly.
Some research does support this theory. Compared to collectivist Japanese negotiators, their more individualist U.S. counterparts are more likely to see offers from their counterparts as unfair and to reject them. Another study revealed that whereas U.S. managers were more likely to use competing tactics in the face of conflicts, compromising and avoiding are the most preferred methods of conflict management in China. Interview data, however, suggests top management teams in Chinese high-technology firms prefer collaboration even more than compromising and avoiding.
63

Contrast Distributive and Integrative Bargaining (1 of 6)
Negotiation is a process in which two or more parties exchange goods or services and attempt to agree upon the exchange rate for them.
We use the terms negotiation and bargaining interchangeably.

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Negotiation is a process in which two or more parties exchange goods or services and attempt to agree upon the exchange rate for them. We use the terms negotiation and bargaining interchangeably. Although we commonly think of the outcomes of negotiation in one-shot economic terms, every negotiation in organizations also affects the relationship between the negotiators and the way the negotiators feel about themselves. Depending on how much the parties are going to interact with one another, sometimes maintaining the social relationship and behaving ethically will be just as important as achieving an immediate outcome of bargaining.
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Contrast Distributive and Integrative Bargaining (2 of 6)
Exhibit 18-5 Distributive versus Integrative Bargaining
Bargaining Characteristic Distributive Bargaining Integrative Bargaining
Goal Get as much of the pie as possible Expand the pie so that both parties are satisfied
Motivation Win–lose Win–win
Focus Positions (“I can’t go beyond this point on this issue.”) Interests (“Can you explain why this issue is so important to you?”)
Interests Opposed Congruent
Information sharing Low (Sharing information will only allow other party to take advantage.) High (Sharing information will allow each party to find ways to satisfy interests of each party.)
Duration of relationship Short term Long term

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There are two general approaches to negotiation – distributive bargaining and integrative bargaining. Exhibit 14-6 shows that the two types of bargaining differ in their goals, motivation, focus, interests, information sharing, and duration.
65

Contrast Distributive and Integrative Bargaining (3 of 6)
Exhibit 18-6 Staking Out the Bargaining Zone

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An example of distributive bargaining is buying a car. You go out to see the car. It is great and you want it. The owner tells you the asking price. You do not want to pay that much. The two of you then negotiate over the price. The most identifying feature of distributive bargaining is that it operates under zero-sum conditions.
Exhibit 14-7 shows that the essence of distributive bargaining is negotiating over who gets what share of a fixed pie. By fixed pie, we mean a set amount of goods or services to be divvied up. When the pie is fixed, or the parties believe it is, they tend to bargain distributively.
In contrast to distributive bargaining, integrative bargaining assumes that one or more of the possible settlements can create a win–win solution. Integrative bargaining is preferable to distributive bargaining because the former builds long-term relationships. Integrative bargaining bonds negotiators and allows them to leave the bargaining table feeling they have achieved a victory. Distributive bargaining, however, leaves one party a loser. It tends to build animosity and deepen divisions when people have to work together on an ongoing basis.
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Contrast Distributive and Integrative Bargaining (4 of 6)
Research shows that when you’re engaged in distributive bargaining, one of the best things you can do is make the first offer, and make it an aggressive one.
Shows power.
Establishes an anchoring bias.
Another distributive bargaining tactic is revealing a deadline.

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When engaged in distributive bargaining, research consistently shows one of the best things you can do is make the first offer, and make it an aggressive one. One reason for this is that making the first offer shows power; individuals in power are much more likely to make initial offers, speak first at meetings, and thereby gain the advantage.
Another reason, the anchoring bias, was mentioned in Chapter 6. People tend to fixate on initial information. A savvy negotiator sets an anchor with the initial offer, and scores of negotiation studies show that such anchors greatly favor the person who sets it.
Another distributive bargaining tactic is revealing a deadline. Negotiators who reveal deadlines speed concessions from their negotiating counterparts, making them reconsider their position. And although negotiators don’t think this tactic works, in reality, negotiators who reveal deadlines do better.
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Contrast Distributive and Integrative Bargaining (5 of 6)
Exhibit 18-7 Integration of Two Bargaining Strategies within One Negotiation Episode

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Exhibit 14-7 illustrates how the two bargaining strategies can be utilized within the same negotiation episode. Early on in the episode, integrative strategies can be used, while later in the episode, distributive strategies can be used.
Why don’t we see more integrative bargaining in organizations? The answer lies in the conditions necessary for this type of negotiation to succeed, including: parties who are open with information and candid about their concerns; a sensitivity by both parties to the other’s needs; the ability to trust one another; and a willingness by both parties to maintain flexibility. These conditions don’t exist in most organizations.
Employees’ personal characteristics and perceived accountability also play a role in whether negotiators come to an integrative solution. The use and effectiveness of negotiation strategies may depend on regulatory focus of the parties involved and accountability to a third party, such as a supervisor. Individuals are also more likely to use integrative bargaining when the other party expresses emotional ambivalence.
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Contrast Distributive and Integrative Bargaining (6 of 6)
Compromise might be your worst enemy in negotiating a win-win agreement.
The reason is that compromising reduces the pressure to bargain integratively.

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Finally, you should realize that compromise might be your worst enemy in negotiating a win–win agreement. The reason is that compromising reduces the pressure to bargain integratively. After all, if you or your opponent caves in easily, it doesn’t require anyone to be creative to reach a settlement. Thus, people end up settling for less than they could have obtained if they had been forced to consider the other party’s interests, trade-off issues, and be creative.
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Apply the Five Steps of the Negotiation Process
Exhibit 18-8 The Negotiation

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Exhibit 14-8 shows a simplified model of the negotiation process as made up of five steps: (1) preparation and planning, (2) definition of ground rules, (3) clarification and justification, (4) bargaining and problem-solving, and (5) closure and implementation.
When it comes to preparation and planning, first, do your homework. What is the nature of the conflict? What is the history leading up to this negotiation? Who is involved, and what are their perceptions of the conflict? What do you want from the negotiation? What are your goals? You also want to assess what you think are the other party’s goals. Once you have gathered your information, use it to develop a strategy. Determine your and the other side’s Best Alternative To a Negotiated Agreement, or BATNA. Your BATNA determines the lowest value acceptable to you for a negotiated agreement. Any offer you receive that is higher than your BATNA is better than an impasse.
Next, define the ground rules. Who will do the negotiating? Where will it take place? What time constraints, if any, will apply? To what issues will negotiation be limited? Will there be a specific procedure to follow if an impasse is reached? During this phase, the parties will also exchange their initial proposals or demands.
When initial positions have been exchanged, explain, amplify, clarify, bolster, and justify your original demands. This need not be confrontational. You might want to provide the other party with any documentation that helps support your position.
The essence of the negotiation process takes place in the bargaining and problem solving phase. This is the actual give-and-take in trying to hash out an agreement. Concessions will undoubtedly need to be made by both parties.
The final step is formalizing the agreement that has been worked out and developing any procedures that are necessary for implementation and monitoring. Major negotiations will require hammering out the specifics in a formal contract. For most cases, however, closure of the negotiation process is nothing more formal than a handshake.
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How Individual Differences Influence Negotiations (1 of 4)
Personality Traits in Negotiation
Can you predict an opponent’s negotiating tactics if you know something about his/her personality?
The evidence says “sort of.”
Moods/Emotions in Negotiation
Influence negotiation, but the way they do appears to depend on the type of negotiation.

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Can you predict an opponent’s negotiating tactics if you know something about his or her personality? The evidence says “sort of.”
It suggests that overall agreeableness is weakly related to negotiation outcomes. Why is this the case? Because the degree to which agreeableness, and personality more generally, affects negotiation outcomes depends on the situation. The importance of being extraverted in negotiations, for example, will very much depend on how the other party reacts to someone who is assertive and enthusiastic. Research also suggests intelligence predicts negotiation effectiveness, but, as with personality, the effects aren’t especially strong.
Moods and emotions influence negotiation, but the way they do appears to depend on the type of negotiation. It appears that negotiators in a position of power or equal status who show anger negotiate better outcomes because their anger induces concessions from their opponents. Anxiety also appears to have an impact on negotiation. For example, one study found that individuals who experienced more anxiety about a negotiation used more deceptions in dealing with others. Another study found that anxious negotiators expect lower outcomes from negotiations, respond to offers more quickly, and exit the bargaining process more quickly, which leads them to obtain worse outcomes.
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How Individual Differences Influence Negotiations (2 of 4)
Culture in Negotiations
Do people from different cultures negotiate differently?
Yes, they do.
People generally negotiate more effectively within cultures than between them.
In cross-cultural negotiations, it is especially important that the negotiators be high in openness.
People are more likely to use certain negotiation strategies depending on what culture they belong to.
Negotiators need to be especially aware of the emotional dynamics in cross-cultural negotiation.

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Do people from different cultures negotiate differently? The simple answer is the obvious one: yes, they do.
First, it appears that people generally negotiate more effectively within cultures than between them. For example, a Colombian is apt to do better negotiating with a Colombian than with a Sri Lankan. Second, it appears that in cross-cultural negotiations, it is especially important that the negotiators be high in openness. Third, people are more likely to use certain negotiation strategies depending on what culture they belong to. For example, people from China and Qatar are more likely to use a competitive negotiation strategy than people from the United States. Finally, because emotions are culturally sensitive, negotiators need to be especially aware of the emotional dynamics in cross-cultural negotiation.
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How Individual Differences Influence Negotiations (3 of 4)
Gender Differences in Negotiations
Men and women negotiate differently and these differences affect outcomes.
There is some merit to the popular stereotype that women are more cooperative, pleasant, and relationship-oriented in negotiations than are men.
These gender differences can be lessened at both the organizational and individual level.

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Men and women negotiate differently and these differences affect outcomes. A popular stereotype is that women are more cooperative, pleasant, and relationship-oriented in negotiations than are men. There is some merit to this. Men tend to place a higher value on status, power, and recognition, whereas women tend to place a higher value on compassion and altruism. Moreover, women do tend to value relationship outcomes more than men, and men tend to value economic outcomes more than women. These differences affect both negotiation behavior and negotiation outcomes.
Compared to men, women tend to behave in a less assertive, less self-interested, and more accommodating manner. However, the disparity goes even further than that. Because of the way women approach negotiation, other negotiators seek to exploit female negotiators by, for example, making lower salary offers.
So what can be done to change this troublesome state of affairs? First, organizational culture plays a role here. If an organization, even unwittingly, encourages a predominantly competitive model for negotiators, this will tend to increase gender-stereotypic behaviors (men negotiating competitively, women negotiating cooperatively), and it will also increase backlash when women go against stereotype. Second, at an individual level, women cannot directly control male stereotypes of women. Fortunately, such stereotypes are fading. However, women can control their own negotiating behavior.
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How Individual Differences Influence Negotiations (4 of 4)
OB POLL Men Ask More
Source: Based on A. Gouveia, “Why Americans Are Too Scared to Negotiate Salary,” San Francisco Chronicle, April 3, 2013, downloaded May 30, 2013, from http://www.sfgate.com/jobs/.

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This OB Poll shows that men and women negotiate differently, are treated differently by negotiation partners, and then have different negotiation outcomes.
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Roles and Function of Third-party Negotiations (1 of 2)
Negotiating in a social context:
Reputation: the way other people think and talk about you.
Develop a trustworthy reputation – competence and integrity.
Relationships: think about what’s best for the other party and the relationship as a whole.
Repeated negotiations built on trust provide more options.

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To really understand negotiations in practice, then, we must consider the social factors of reputation and relationships.
Your reputation is the way other people think and talk about you. When it comes to negotiation, having a reputation for being trustworthy matters. In short, trust in a negotiation process opens the door to many forms of integrative negotiation strategies that benefit both parties. The most effective way to build trust is to behave in an honest way across repeated interactions. Then, others feel more comfortable making open-ended offers with many different outcomes. This helps to achieve win–win outcomes, since both parties can work to achieve what is most important to themselves while still benefitting the other party.
What type of characteristics help a person develop a trustworthy reputation? A combination of competence and integrity. Negotiators higher in self-confidence and cognitive ability are seen as more competent by negotiation partners. They are also considered better able to accurately describe a situation and their own resources, and more credible when they make suggestions for creative solutions to impasses.
Individuals who have a reputation for integrity can also be more effective in negotiations.
They are seen as more likely to keep their promises and present information accurately, so others are more willing to accept their promises as part of a bargain. Finally, individuals who have higher reputations are better liked and have more friends and allies—in other words, they have more social resources, which may give them more understood power in negotiations.
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Roles and Function of Third-party Negotiations (2 of 2)
When individuals or group representatives reach a stalemate and are unable to resolve their differences through direct negotiations, they may turn to a third party.
A mediator
An arbitrator
A conciliator

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When individuals or group representatives reach a stalemate and are unable to resolve their differences through direct negotiations, they may turn to a third party.
A mediator is a neutral third party who facilitates a negotiated solution by using reasoning and persuasion, suggesting alternatives, and the like. They are widely used in labor-management negotiations and in civil court disputes. Their settlement rate is approximately 72%. The key to success – the conflicting parties must be motivated to bargain and resolve their conflict, intensity cannot be too high, and the mediator must be perceived as neutral and non-coercive.
An arbitrator is a third party with the authority to dictate an agreement. It can be voluntary (requested) or compulsory (forced on the parties by law or contract). The big plus of arbitration over mediation is that it always results in a settlement.
A conciliator is a trusted third party who provides an informal communication link among parties. This role was made famous by Robert Duval in the first Godfather film. Comparing its effectiveness to mediation has proven difficult. Conciliators engage in fact-finding, interpreting messages, and persuading disputants to develop agreements.
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Implications for Managers (1 of 3)
Choose an authoritarian management style in emergencies, when unpopular actions need to be implemented, and when the issue is vital to the organization’s welfare. Be certain to communicate your logic when possible to make certain employees remain engaged and productive.
Seek integrative solutions when your objective is to learn, when you want to merge insights from people with different perspectives, when you need to gain commitment by incorporating concerns into a consensus, and when you need to work through feelings that have interfered with a relationship.

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While many people assume conflict lowers group and organizational performance, this assumption is frequently incorrect. Conflict can be either constructive or destructive to the functioning of a group or unit. Levels of conflict can be either too high or too low to be constructive. Either extreme hinders performance. An optimal level is one that prevents stagnation, stimulates creativity, allows tensions to be released, and initiates the seeds of change without being disruptive or preventing coordination of activities.
Managers should:
Choose an authoritarian management style in emergencies, when unpopular actions need to be implemented (such as cost cutting, enforcement of unpopular rules, and discipline), and when the issue is vital to the organization’s welfare. Be certain to communicate your logic when possible to make certain employees remain engaged and productive.
Seek integrative solutions when your objective is to learn, when you want to merge insights from people with different perspectives, when you need to gain commitment by incorporating concerns into a consensus, and when you need to work through feelings that have interfered with a relationship.
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Implications for Managers (2 of 3)
You can build trust by accommodating others when you find you’re wrong, when you need to demonstrate reasonableness, when other positions need to be heard, when issues are more important to others than to yourself, when you want to satisfy others and maintain cooperation, when you can build social credits for later issues, to minimize loss when you are outmatched and losing, and when employees should learn from their own mistakes.

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Managers should also: Build trust by accommodating others when you find you’re wrong, when you need to demonstrate reasonableness, when other positions need to be heard, when issues are more important to others than to yourself, when you want to satisfy others and maintain cooperation, when you can build social credits for later issues, to minimize loss when you are outmatched and losing, and when employees should learn from their own mistakes.
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Implications for Managers (3 of 3)
Consider compromising when goals are important but not worth potential disruption, when opponents with equal power are committed to mutually exclusive goals, and when you need temporary settlements to complex issues.
Distributive bargaining can resolve disputes, but it often reduces the satisfaction of one or more negotiators because it is confrontational and focused on the short term. Integrative bargaining, in contrast, tends to provide outcomes that satisfy all parties and build lasting relationships.

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Finally:
Consider compromising when goals are important but not worth potential disruption, when opponents with equal power are committed to mutually exclusive goals, and when you need temporary settlements to complex issues.
Distributive bargaining can resolve disputes, but it often reduces the satisfaction of one or more negotiators because it is confrontational and focused on the short term. Integrative bargaining, in contrast, tends to provide outcomes that satisfy all parties and build lasting relationships.
Make sure you set aggressive negotiating goals and try to find creative ways to achieve the objectives of both parties, especially when you value the long-term relationship with the other party. That doesn’t mean sacrificing your self-interest; rather, it means trying to find creative solutions that give both parties what they really want.
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