Chapter 1 Introduction to the Field of Organizational Behaviour Canadian OB 7e: McShane/Steen 1 © 2009 The McGraw-Hill Companies, Inc. All rights reserved.

Chapter 1

Chapter 1

Introduction tothe Field of

Organizational Behaviour

Canadian OB 7e: McShane/Steen 1 © 2009 The McGraw-Hill Companies, Inc. All rights reserved

PCL Family of Companies

Several organizational behaviour practices have helped the Edmonton-based PCL Family of Companies become an employer of choice, a leader in the construction industry, and a valued community member

Canadian OB 7e: McShane/Steen

© 2009 The McGraw-Hill Companies, Inc. All rights reserved

2

Organizational Behaviourand Organizations

Organizational behaviour• The study of what people think, feel, and do

in and around organizations Organizations

• Groups of people who work interdependently toward some purpose- Structured patterns of interaction - Coordinated tasks- Organizations have a purpose (even if not fully

agreed)


3Canadian OB 7e: McShane/Steen

Why Study OB?

Satisfy the need to understand and predict

Helps us to test personal theories

Influence behaviour – get things done

OB improves an organization’s financial health

OB is for everyone



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Old Perspective ofOrganizational Effectiveness

Goal oriented -- Effective firms achieve their stated objectives

No longer accepted as a perspective of org effectiveness• Companies could set easy goals• Some goals too abstract to know if achieved• Company might achieve goals but go out of

business by achieving wrong goals


5 © 2009 The McGraw-Hill Companies, Inc. All rights reserved

Defining Organizational Effectiveness as 4 Perspectives

1. Open systems: they have a good fit with their external environment

2. High-performance work practices: their internal subsystems are configured for a high-performance workplace

3. Organizational learning: they are learning organizations

4. Stakeholder: they satisfy the needs of key stakeholders

NOTE: Need to consider all four perspectives when assessing a company’s effectiveness



Open Systems Perspective

Organizations -- complex systems that “live” within (and depend upon) the external environment

Effective organizations• Maintain a close “fit” with changing conditions• Transform inputs to outputs efficiently and

flexibly Open systems perspective – foundation

for the other three effectiveness perspectives





8

Open Systems Perspective

Subsystems-- processes, task activities, social dynamics within the system

Transformation process-- subsystems transform inputs into various outputs

Feedback-- information from environment about value of outputs/availability of inputs

FeedbackFeedback

FeedbackFeedback

Environment

Organizational Learning Perspective

An organization’s capacity to acquire, share, use, and store valuable knowledge

Need to consider both stock and flow of knowledge• Stock: intellectual capital• Flow: org learning processes of acquisition,

sharing, and use



Intellectual Capital

Relationship Relationship CapitalCapital

Value derived from satisfied customers, reliable suppliers, etc.

Structural CapitalStructural CapitalKnowledge captured in systems and structures

HumanHumanCapitalCapital

Knowledge that people possess and generate



Organizational Learning Processes

Applying knowledge to organizational processes in ways that improves the organization’s effectiveness

Distributing knowledge throughout the organization

Extracting information and ideas from its environment as well as through insight

KNOWLEDGEACQUISITIONKNOWLEDGEACQUISITION

KNOWLEDGESHARING

KNOWLEDGESHARING

KNOWLEDGEUSE

KNOWLEDGEUSE

Examples in practice

Hiring skilled staff

Posting case studies on intranet

Giving staff freedom to try out ideas



Organizational Memory

The storage and preservation of intellectual capital

Retain intellectual capital by:• Keeping knowledgeable employees• Transferring knowledge to others• Transferring human capital to structural

capital Successful companies also unlearn



High Performance Work Practices (HPWPs)

HPWPs are internal systems and structures that are associated with successful companies

1. Employees are competitive advantage

2. Value of employees increased through specific practices.

3. Maximum benefit when org practices are bundled



High Performance Work Practices

No consensus, but HPWPs include:

• Employee involvement and job autonomy (and their combination as self-directed teams).

• Employee competence (training, selection, etc.).

• Performance-based rewards



Stakeholder Perspective

Stakeholders: any entity who affect or is affected by the firm’s objectives and actions

Personalizes the open systems perspective• Identifies social entities in the environment • Stakeholder relations are dynamic

Problem:• Stakeholders have conflicting interests• Firms have limited resources



Canadian Public Service as a Values-Driven Organization

The Canadian federal public service is becoming a values-driven organization. The government believes that values will guide desired behaviours and replace existing control system based on hierarchy and compliance.



Canadian Public Service

Stakeholders: Values and Ethics

Values and ethics prioritize stakeholder interests

Values• Stable, evaluative beliefs,

guide preferences for outcomes or courses of action in various situations

Ethics• Moral principles/values,

determine whether actions are right/wrong and outcomes are good or bad




Stakeholders and CSR

Stakeholder perspective includes corporate social responsibility (CSR)• Benefit society and

environment beyond the firm’s immediate financial interests or legal obligations

• Organization’s contract with society

Triple bottom line• Economy, society,

environment




Types of Individual Behaviour

Organizational Organizational CitizenshipCitizenship

Contextual performance – cooperation and helpfulness beyond required job duties

Task PerformanceTask PerformanceGoal-directed behaviours under person’s control

more



Types of Individual Behaviour (con’t)

Maintaining Work Maintaining Work AttendanceAttendance

Attending work at required times

Joining/staying with Joining/staying with the Organizationthe Organization

Agreeing to employment relationship; remaining in that relationship

Counterproductive Counterproductive Work BehavioursWork Behaviours

Voluntary behaviours that potentially harm the organization



Globalization

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

Effects of globalization on organizations• New structures• Increasing diversity• Increasing competitive pressures,

intensification



Increasing Workforce Diversity

Surface-level diversity• Observable demographic and other overt

differences in people (e.g. race, ethnicity, gender, age)

Deep-level diversity• Differences in psychological characteristics (e.g.

personalities, beliefs, values, and attitudes)• Example: Differences across age cohorts (e.g. Gen-

Y) Implications

• Leveraging the diversity advantage• Also diversity challenges (e.g. teams, conflict)• Ethical imperative of diversity



Employment Relationships

Work/life balance • Minimizing conflict between work and nonwork

demands number one indicator of career success Virtual work

• Using information technology to perform one’s job away from the traditional physical workplace

• Telework – issues of replacing face time, clarifying employment expectations

Virtual teams• Operate across space, time, and organizational

boundaries with members who communicate mainly through electronic technologies



Organizational Behaviour Anchors

Multidisciplinary anchor• Many OB concepts adopted from other disciplines• OB develops its own theories, but scans other fields

Systematic research anchor• OB researchers rely on scientific method• Should apply evidence-based management, but…

- Bombarded with theories and models- Challenge translating general theories to specific situations- Swayed by consultant marketing- Perceptual biases -- ignoring evidence contrary to our beliefs



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Organizational behaviour Anchors (con’t)

Contingency anchor• A particular action may have different consequences

in different situations• Need to diagnose the situation and select best

strategy under those conditions

Multiple levels of analysis anchor• Individual, team, organizational level of analysis• OB topics usually relevant at all three levels of

analysis



Chapter 1

Chapter 1

Introduction tothe Field of

Organizational Behaviour

Canadian OB 7e: McShane/Steen 26 © 2009 The McGraw-Hill Companies, Inc. All rights reserved

Chapter 1 Introduction to the Field of Organizational Behaviour Canadian OB 7e: McShane/Steen 1 © 2009 The McGraw-Hill Companies, Inc. All rights reserved.

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