summary-book-organizational-behaviour-chapter-1-15.pdf

Summary: Book "Organizational Behaviour", chapter 1-15

Chapter 1: What is organizational behaviour?

1. Demonstrate the importance of interpersonal skills in the workplace.

Soft skills  team working, communicating effectively, leadership and cultural awareness. These

interpersonal skills are essential for managerial effectiveness: easier to hire and keep qualified people. 2. Describe the manager’s functions, roles and skills

Managers  get things done through other people. They make decisions, allocate resources and

direct the activities of others to attain goals. Managers do their work in an organization, which is 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.

Managers perform four management functions:

1. Planning  process that includes defining goals, establishing strategy, and developing plans to coordinate activities.

2. Organizing  determining what tasks are to be done, who is to do them, how the tasks are to be grouped, who reports to whom and where decisions are to be made.

3. Leading  function that includes motivating employees, directing others, selecting the most effective communication channels and resolving conflicts.

4. Controlling  monitoring activities to ensure that they are being accomplished as planned and correcting any significant deviations.

Managers perform 10 different, highly interrelated roles. As shown on p. 5, these can be grouped as:

 Interpersonal roles

a. Figurehead role  performing duties that are ceremonial in nature. b. Leadership role  training, motivating and disciplining employees. c. Liaison role  contacting outsiders who provide the manager with

information.

 Informational roles

a. Monitor role  collecting information from outside organizations and institutions.

b. Disseminator role  transmitting information to organizational members. c. Spokesperson role  representing the organization to outsiders.

 Decisional roles

a. Entrepreneur role  initiating and overseeing new projects that will improve their organization’s performance.

b. Disturbance handlers  taking corrective action in response to unforeseen problems.

c. Resource allocators  being responsible for allocating human, physical and monetary resources.

d. Negotiator role  discussing issues and bargain with other units to gain advantages for their own unit.

• Gut feelings • Individual observation • Commonsense

Intuition

Systematic

study

 Technical skills  ability to apply specialised knowledge or expertise.

 Human skills  ability to work with, understand and motivate other people, both individually

and in groups.

 Conceptual skills  mental ability to analyze and diagnose complex situations.

Managers engage in four managerial activities:

1. Traditional management  decision making, planning, and controlling 2. Communication  exchanging routine information and processing paperwork

3. Human resource management  motivating, disciplining, managing conflict, staffing and training.

4. Networking  socialising, politicking and interacting with outsiders.

Managers who are successful (defined in terms of the speed of promotion within their organization have a very different emphasis from managers who are effective (defined in terms of the quantity and quality of their performance and the satisfaction and commitment of their employees).

3. Define organizational behaviour.

Organizational behaviour  a field of study that investigates the impact that individuals, groups,

and structure have on behaviour within organizations, for the purpose of applying such knowledge toward improving an organization’s effectiveness

4. Show the value to OB of systematic study.

There are certain fundamental consistencies underlying the behaviour of all individuals that can be identified and then modified to reflect individual differences. Behaviour is generally predictable, and the systematic study of behaviour is a means to making reasonably accurate predictions.

Systematic study  can be time-consuming.

Evidence-based management (EBM)  basing managerial decisions on the best available scientific

evidence.

Intuition  gut feeling not necessarily supported by research, often based on inaccurate information.

Core values of science:

 Accuracy

 Objectivity

 Scepticism

 Open-mindedness

Use evidence as much as possible to inform your intuition and experience  promise of OB.

5. Identify the major behavioural science disciplines that contribute to OB.

Psychology  science that seeks to measure, explain and sometimes change the behaviour of humans

Social psychology  area of psychology that blends concepts from psychology and sociology and

that focuses on the influence of people on one another. Change has been a major area receiving considerable investigation  how to implement it and how to reduce barriers to its acceptance.

Sociology  study of people in relation to their social environment or culture.

Anthropology  study of societies to learn about human beings and their activities. See page 11.

6. Demonstrate why there are few absolutes in OB.

Contingency variables  situational factors: variables that moderate the relationship between two or

more other variables.

7. Identify the challenges and opportunities managers have in applying OB concepts.

Responding to globalisation:

 Increased foreign assignments  manage a workforce that is likely to be very different in

needs, aspirations and attitudes.

 Working with people from different cultures  to work effectively with people from

different cultures, you need to understand how their culture, geography and religion have shaped them and how to adapt your management style to their differences.

 Coping with anticapitalism backlash  management practices need to be modified to

reflect the values of the different countries in which an organization operates.

 Overseeing movement of jobs to countries with low-cost labour  managers must deal

with the difficult task of balancing the interests of their organization with their responsibilities to the communities in which they operate.

Managing workforce diversity  organizations are becoming more heterogeneous in terms of

gender, age, race, ethnicity, sexual orientation and inclusion of other diverse groups.

 Embracing diversity  replace melting-pot assumption by one that recognises and values

differences.

 Changing European demographics  age and gender.

 Implications  workforce diversity has implications for management practice  they have

to shift their philosophy from treating everyone alike to recognising differences and responding to those differences in ways that ensure employee retention and greater productivity, while, at the same time, not discriminating.

Improving quality and productivity  excess capacity translates into increased competition, and

that is forcing managers to reduce costs and, at the same time, improve their organization’s productivity and the quality of the products and services they offer.

Improving customer service  management needs to create a customer-responsive culture. Improving people skills  explain and predict the behaviour of people at work.

Stimulation innovation and change  stimulate employees’ creativity and tolerance for change. Coping with ‘temporariness’  learn to live with flexibility, spontaneity and unpredictability.

Working in networked organizations  computerisation, the Internet, and the ability to link

computers within organizations and between organizations have created a different workplace for many employees, so managers need to develop new skills.

Helping employees balance work-life conflicts

Creating a positive work environment  to realise a competitive advantage. Positive organizational scholarship  how organizations develop human strengths, foster vitality and

resilience and unlock potential. It challenges organizations to think about how to exploit their employees’ strengths rather than dwell on their limitations.

Improving ethical behaviour  members of organizations are increasingly finding themselves

facing ethical dilemmas, situations in which they are required to define right and wrong conduct. Managers need to create an ethically healthy climate for their employees, where they can do their work productively and confront a minimal degree of ambiguity regarding what constitutes right and wrong.

8. Compare the three levels of analysis in this book’s OB model.

Model  abstraction of reality, a simplified representation of some real-world phenomenon. Each

level is constructed on the previous level, see page 25.

Dependent variable  key factor that you want to explain and that is affected by some other factor.

 Productivity  performance measure that includes effectiveness and efficiency. It implies a

concern for both effectiveness (achievement of goals) and efficiency (ratio of effective output to the input required to achieve it)

 Absenteeism  failure to report to work. Organizations benefit when absenteeism is low.

 Turnover  voluntary and involuntary permanent withdrawal from an organization.

Reasonable levels of employee-initiated turnover facilitate organizational flexibility and employee independence, and they can lessen the need for management-initiated layoffs.

 Deviant workplace behaviour (antisocial behaviour or workplace incivility)  voluntary

behaviour that violates significant organizational norms and, in so doing, threatens the well-being of the organization or its members. Managers want to understand the source of workplace deviance in order to avoid a chaotic work environment, and workplace deviance can also have a considerable financial impact.

 Organizational citizenship behaviour (OCB)  discretionary behaviour that is not part of

an employee’s formal job requirements, but that nevertheless promotes the effective functioning of the organization.

 Job satisfaction  positive feeling about one’s job resulting from an evaluation of its

characteristics, represents attitude rather than behaviour.

Independent variables  presumed cause of some changes in a dependent variable.

 Individual-level variables  people enter organizations with certain intact characteristics

that will influence their behaviour at work. There is little management can do to alter them.

 Group-level variables  the behaviour of people in groups is more than the sum total of all

the individuals acting in their own way. The complexity of our model is increased when we acknowledge that people behave differently in groups or alone.

 Organization system-level variables  OB reaches its highest level of sophistication when

Chapter 2: Foundations of individual behaviour

1. Contrast the two types of ability.

From management’s standpoint, the issue is not whether people differ in terms of their abilities. They clearly do. The issue is knowing how people differ in abilities and using that knowledge to increase the likelihood that an employee will perform their job well.

Ability  an individual’s capacity to perform the various tasks in a job. An individual’s overall

abilities are essentially made up of two sets of factors: intellectual and physical.

2. Define intellectual ability and demonstrate its relevance to OB.

Intellectual abilities  abilities needed to perform mental activities – for thinking, reasoning and

problem solving. The seven most frequently cited dimensions making up intellectual abilities are number aptitude, verbal comprehension, perceptual speed, inductive reasoning, deductive reasoning, spatial visualisation and memory, see page 35.

General mental ability (GMA)  overall factor of intelligence, as suggested by the positive

correlations among specific intellectual ability dimensions.

Physical abilities  capacity to do tasks that demand stamina, dexterity, strength, and similar

characteristics.

3. Identify the key biographical characteristics and describe how they are relevant to OB.

Biographical characteristics  personal characteristics that are objective and easily obtained from

personnel records.

 Age  the relationship between age and job performance is likely to be an issue of increasing

importance during the next decade for two primary reasons. First, performance declines with increasing age. Second, the workforce is aging.

a. Age – turnover  the older you get, the less likely you are to quit a job.

b. Age – absenteeism  is partially a function of whether the absence is avoidable or unavoidable.

c. Age – productivity  unrelated

d. Age – satisfaction  satisfaction tends to continually increase among professionals as they age, but it falls among non-professionals during middle age and then rises again in the later years.

 Gender  few issues initiate more debates, misconceptions and unsupported opinions than

whether women perform as well on jobs as men do. There is no significant difference in job productivity between men and women. However, there is an issue that does seem to differ between genders, namely the preference for work schedules.

 Race  it is in characteristics like skin tones, hair textures and other physical characteristics, along with culture and ethnic origins, that people may use to group themselves and others into ‘races’  biological heritage people use to identify themselves. It relates to employment outcomes such as personnel selection decision, performance evaluations, pay and workplace discrimination.

 Employment tenure  the length of time that a worker has spent with the same employer. \ a. Seniority – productivity  positive

b. Seniority – absenteeism  negative c. Seniority – turnover  negative d. Seniority – job satisfaction  positive

 Religion  is clearly having an effect in the workplace, however, there has not been a great

deal of research into these affects to date. What is known is that workers who are the victims of religious discrimination have higher levels of health problems, absence and turnover (the rate at which an employer gains and loses employees).

4. Define learning and outline the principles of the three major theories of learning.

If we want to explain and predict behaviour, we need to understand how people learn. Learning  a relatively permanent change in behaviour that occurs as a result of experience.

1. Learning involves change. 2. Is relatively permanent.

3. Is acquired through experience.

Theories of learning:

 Classical conditioning  type of conditioning in which an individual responds to some

stimulus that would not ordinarily produce such a response.

 Operant conditioning  type of conditioning in which desired voluntary behaviour leads to

a reward or prevents a punishment. If a behaviour fails to be positively reinforced, the probability that the behaviour will be repeated declines. The concept was part of Skinner’s broader concept of behaviourism  a theory which argues that behaviour follows stimuli in a relatively unthinking manner.

 Social-learning theory  the view that people can learn through direct experience, but also

indirectly by observation, reading, or just hearing about someone else’s experiences. The influence of models is central in the social-learning viewpoint. Four processes have been found to determine the influence that a model will have on an individual:

1. Attentional processes  people learn from a model only when they recognise and pay attention to its critical features.

2. 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. 3. Motor reproduction processes  after a person has seen a new behaviour by

observing the model, the watching must be converted to doing. This process then demonstrates that the individual can perform the modelled activities.

4. Reinforcement processes  individuals are motivated to exhibit the modelled behaviour if positive incentives or rewards are provided. Behaviours that are positively reinforced are given more attention, learned better and performed more often.

Shaping behaviour  systematically reinforcing each successive step that moves an individual closer

to the desired response.

There are four ways to shape behaviour:

1. Positive reinforcement  following a response with something pleasant (learning) 2. Negative reinforcement  following a response by the termination or withdrawal of

something unpleasant (learning)

3. Punishment  causing an unpleasant condition in an attempt to eliminate an undesirable behaviour (unlearning)

4. Extinction  eliminating any reinforcement that is maintaining a behaviour (unlearning) See page 46 for schedules of reinforcement, the two major types are:

 Continuous reinforcement  reinforcing a desired behaviour each time it is demonstrated.

 Intermittent reinforcement  reinforcing a desired behaviour often enough to make the

behaviour worth repeating but not every time it is demonstrated.

a. Ratio schedules depend on how many responses the subject makes.

 Fixed-ratio schedule  initiating rewards after a fixed or

constant number of responses.

 Variable-ratio schedule  varying the reward relative to the

behaviour of the individual (very powerful!).

b. Interval schedules depend on how much time has passed since last reinforcement.

 Fixed-interval schedule  rewards are spaced at uniform time

intervals. The critical value is time, which is held constant.

 Variable-interval schedule  rewards are distributed in time

so that reinforcements are unpredictable (very powerful!).

OB Mod  application of reinforcement concepts to individuals in the work setting. The typical OB

Mod programme follows a five-step problem-solving model: 1. Identify critical behaviours

2. Develop baseline data

3. Identify behavioural consequences

4. Develop and implementing an intervention strategy 5. Evaluate performance improvement

One problem with behaviourism is that thoughts and feelings immediately follow environmental stimuli, even those explicitly meant to shape behaviour. This is contrary to the assumptions of behaviourism and OB Mod, which assume that people’s innermost thoughts and feelings in response to the environment are irrelevant.

6. Show how culture affects our understanding of intellectual abilities, biographical characteristics and learning.

Evidence strongly supports the idea that the structure of intellectual abilities generalise across cultures. The relationships between for example age and performance are not different across cultures.

Attitudes  evaluative statements or judgements concerning objects, people or events.

1. Contrast the three components of an attitude.

Researchers have assumed that attitudes have three components:

 Cognitive component  the opinion or belief segment of an attitude.

 Affective component  the emotional or feeling segment of an attitude.

 Behavioural component  an intention to behave in a certain way toward someone or

something.

2. Summarise the relationship between attitudes and behaviour.

Cognitive dissonance  any incompatibility between two or more attitudes or between behaviour and

attitudes. Any form of inconsistency is uncomfortable and individuals will attempt to reduce the dissonance and, hence, the discomfort. The desire to reduce dissonance depends on:

 the importance of the elements creating it

 the degree of influence the individual believes he has over the elements

 the rewards of dissonance

The most powerful moderators of the attitude-behaviour relationship are:

 the importance of the attitude  attitudes that individuals consider important tend to show a

strong relationship to behaviour.

 its correspondence to behaviour  the more closely the attitude and the behaviour are

matched or correspond, the stronger the relationship.

 its accessibility  attitudes we remember easily are more likely to predict our behaviour.

 whether there exist social pressures  discrepancies between attitudes and behaviour are

more likely to occur when social pressures to behave in certain ways hold exceptional power.

 whether a person has direct experience with the attitude  the attitude-behaviour relationship

is likely to be much stronger if an attitude refers to something with which the individual has direct personal experience.

3. Compare and contrast the major job attitudes.

Most of the research in OB has looked at three attitudes: job satisfaction, job involvement and organizational commitment. A few other attitudes attraction attention from researchers include perceived organizational support and employee engagement.

Job satisfaction  a positive feeling about one’s job resulting from an evaluation of its

characteristics. When people speak of employee attitudes, they usually mean job satisfaction. Related to job satisfaction is job involvement  the degree to which a person identifies with a job, actively participates in it and considers performance important to self-worth. Another loosely related concept is psychological empowerment  employees’ belief in the degree to which they affect their work environment, their competence, the meaningfulness of their job and their perceived autonomy in their work.

Organizational commitment  the degree to which an employee identifies with a particular

involvement means identifying with your specific job, while high organization commitment means identifying with your employing organization. There are three separate dimensions:

1. Affective commitment  an emotional attachment to an organization and a belief in its values.

2. Continuance commitment  the perceived economic value of remaining with an organization compared to leaving it.

3. Normative commitment  an obligation to remain with an organization for moral or ethical reasons.

The relationship between organizational commitment and job productivity is strongest for new employees, and it is considerably weaker for more experienced employees. As with job involvement, the research evidence demonstrates negative relationships between organizational commitment and both absenteeism and turnover.

Perceived organizational support (POS)  the degree to which employees believe an organization

values their contribution and cares about their well-being. Research shows that people perceive their organization as supportive when rewards are deemed fair, when employees have a voice in decisions, and when their supervisors are seen as supportive. Employees with strong POS perceptions are more likely to have higher levels of organizational citizenship behaviours and job performance.

Employee engagement  an individual’s involvement and satisfaction with, and enthusiasm for, the

work he or she does. Highly engaged employees have a passion for their work and feel a deep connection to their company, disengaged employees do not.

4. Define job satisfaction and show how it can be measured.

The two most widely used approaches to measure job satisfaction are:

 Global rating  a response to the question ‘All things considered, how satisfied are you with

your job?’ Respondents circle a number between 1 and 5. It is not time-consuming.

 Summation score made up of a number of job facets  identifies key elements in a job and

asks for the employee’s feelings about each. Typical elements here are the nature of the work, supervision, present pay, promotion opportunities and relations with co-workers. Respondents rate the on a standardised scale, and researchers add the ratings to create an overall job satisfaction score. It helps managers to zero in on where the problem exists.

The concept of job satisfaction is inherently so broad that the single question captures its essence.

5. Summarise the main causes of job satisfaction.

Of the major job-satisfaction facets, enjoying the work is almost always the one most strongly correlated with high levels of overall job satisfaction. Interesting jobs that provide training, variety, independence and control satisfy most employees. Jobs involving solving unforeseen problems, performing complex tasks and learning new things have been associated with higher levels of work satisfaction. In other words, most people prefer work that is challenging and stimulating over work that is predictable and routine. Education, job security, job autonomy, work/life balance and employee participation are all strongly correlated with increased job satisfaction. Good benefits do appear to satisfy employees, but high pay levels much less so.

Job satisfaction is not just about job conditions, personality also plays a role. People who are emotional stable, extravert, and have positive core self-evaluations are more satisfied with their jobs than those with negative core self-evaluations.

Core self-evaluations  bottom-line conclusions individuals have about their capabilities,

competence and worth as a person.

6. Identify four employee responses to dissatisfaction.

One theoretical model, namely the exit-voice-loyalty-neglect framework, is helpful in understanding the consequences in dissatisfaction.

Job satisfaction and job performance  happy workers are more likely to be productive. Job satisfaction and OCB  it seems logical to assume that job satisfaction should be a major

determinant of an employee’s organizational citizenship behaviour (OCB). Satisfied employees would seem more likely to talk positively about the organization, help others, and go beyond the normal expectations in their job. Moreover, satisfied employees might be more prone to go beyond the call of duty because they want to reciprocate their positive experiences. Evidence suggests that job

satisfaction is moderately correlated with OCBs, such that people who are more satisfied with their jobs are more likely to engage in OCBs.

Job satisfaction and customer satisfaction  satisfied employees increase customer satisfaction and

loyalty. The relationship also seems to apply in reverse: dissatisfied customers can increase an employee’s job dissatisfaction.

Job satisfaction and absenteeism  there is a consistent negative relationship between satisfaction and

absenteeism, but the correlation is moderate to weak.

Job satisfaction and turnover  satisfaction is also negatively related to turnover, but the correlation

is stronger than what we found for absenteeism. Other factors, such as labour-market conditions, expectations about alternative job opportunities and length of tenure with the organization, are important constraints on an employee’s decision to leave their current job. Evidence indicates that an important moderator of the satisfaction-turnover relationship is the employee’s level of performance.

Job satisfaction and workplace deviance  job dissatisfaction predicts a lot of specific behaviours

including substance abuse, stealing at work, undue socialising and tardiness. Researchers argue that these behaviours are indicators of a broader syndrome that we would term deviant behaviour in the

workplace (or employee withdrawal). The key is that if employees don’t like their work environment,

they will respond somehow. If employers want to control the undesirable consequences of job dissatisfaction, they should attack the source of the problem, the dissatisfaction, rather than try to control the different responses.

Despite the overwhelming evidence of the impact of job satisfaction on the bottom line, most managers are either unconcerned about or overestimate worker satisfaction.

7. Show whether job satisfaction is an important concept globally.

It appears that similar factors cause, and result from, job satisfaction across cultures, but that doesn’t mean there are no cultural differences in job satisfaction. Evidence suggests that employees in Western cultures have higher levels of job satisfaction than those in Eastern cultures.

Chapter 4: Personality and values

Our personalities shape our behaviours, so if we want to better understand the behaviour of someone in an organization, it helps if we know something about their personality.

1. Define personality, describe how it is measured and explain the factors that determine an individual’s personality.

Personality  the sum total of ways in which an individual reacts and interacts with others.

Personality tests are useful in hiring decisions. By far the most common means of measuring personality is through self-report surveys, with which individuals evaluate themselves by rating themselves on a series of factors such as ‘I worry a lot about the future.’ One weakness of these measures is that the respondent might lie or practice impression management, that is, the person could fake answers on the test to create a good impression. Another problem is accuracy. In other words, a perfectly good candidate could have just been in a bad mood when the survey was taken.

Observer-ratings surveys provide an independent assessment of personality. Instead of self-reporting,

a co-worker or another observer does the rating. Even though the results of self-report surveys and observer-rating surveys are strongly correlated, research suggests that observer-ratings surveys are a better predictor of success on the job.

Personality appears to be a result of both hereditary and environmental factors. However, research in personality development has tended to better support the importance of heredity over the environment.

Heredity  factors determined at conception, one’s biological, physiological and inherent

psychological makeup.

Personality traits  enduring characteristics that describe an individual’s behaviour. The ore

consistent the characteristic and the ore frequently a trait occurs in diverse situations, the more important that trait is in describing the individual.

There are two approaches that have become the dominant frameworks for identifying and classifying traits, namely the Myers-Briggs Type Indicator and the Big Five Model.

2. Describe the Myers-Briggs Type Indicator personality framework and assess its strengths and weaknesses.

Myers-Briggs Type Indicator (MBTI)  a personality test that taps four characteristics and

classifies people into 1 of 16 personality types. It is a 100-question personality test that asks people how they usually feel or act in particular situations. The terms are defined as follows:

 Extraverted (E) versus introverted (I)  extraverted individuals are outgoing, sociable, and

assertive. Introverts are quiet and shy.

 Sensing (S) versus intuitive (N)  sensing types are practical and prefer routine and order.

They focus on details. Intuitives rely on unconscious processes and look at the big picture.

 Thinking (T) versus feeling (F)  thinking types use reason and logic to handle problems.

Feeling types rely on their personal values and emotions.

 Judging (J) versus perceiving (P)  judging types want control and prefer their world to be

ordered and structured. Perceiving types are flexible and spontaneous.

These classifications together describe 16 personality types. The MBTI can be a valuable tool for increasing self-awareness and providing career guidance. But because results tend to be unrelated to job performance, managers probably shouldn’t use it as a selection test for job candidates.

3. Identify the key traits in the Big Five personality model.

Big Five Model  a personality assessment model that taps five basic dimensions.

 Extraversion  a personality dimension that captures one’s comfort level with relationships.

Extraverts tend to gregarious, assertive and sociable. Introverts tend to be reserved, timid and quiet.

 Agreeableness  a personality dimension that refers to an individual’s propensity to defer to

others. Highly agreeable people are cooperative, warm and trusting. People who score low on agreeableness are cold, disagreeable and antagonistic.

 Conscientiousness  a personality dimension that measures 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  a personality dimension taps 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.

 Openness to experience  a personality dimension that addresses one’s 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.

4. Demonstrate how the Big Five traits predict behaviour at work.

The preponderance of evidence shows that individuals who are dependable, reliable, careful, thorough, able to plan, organized, hardworking, persistent, and achievement-oriented tend to have higher job performance in most if not all occupations. Employees who score higher in conscientiousness develop higher levels of job knowledge, probably because highly conscientious people exert greater levels of effort on their jobs. The higher levels of job knowledge then contribute to higher levels of job performance. Although conscientiousness is the Big Five trait most consistently related to job

performance, the other traits are related to aspects of performance in some situations. All five traits have other implications for work and for life:

People who score high on emotional stability are happier than those who score low. Of the Big Five traits, emotional stability is most strongly related to life satisfaction, job satisfaction and low stress levels. One upside of low emotional stability, is that when in a bad mood, such people make faster and better decisions than emotionally stable people in bad moods.

You might expect agreeable people to be happier than disagreeable people, and they are, but only slightly. Agreeable individuals are less likely to engage in organizational deviance. One downside of agreeableness is that it is associated with lower levels of career success (especially earnings). This may occur because agreeable individuals are poorer negotiators, they are so concerned with pleasing others that they often don’t negotiate as much for themselves as do others.

Individuals who score high on openness to experience are more creative in science and in art than those who score low. Because creativity is important to leadership, open people are more likely to be effective leaders. Also, open individuals are more comfortable with ambiguity and change than are those who score lower on this trait. As a result, open people cope better with organizational change and are more adaptable in changing contexts.

Compared to introverts, extraverts tend to be happier in their jobs and in their lives as a whole. They tend to perform better in jobs that require significant interpersonal interaction, perhaps because they have more social skills. Extraversion is a relatively strong predictor of leadership emergence in

groups, extraverts are more socially dominant, take charge sorts of people, and they generally are more assertive than introverts. One downside of extraversion is that extraverts are more impulsive than introverts, they are more likely to be absent from work and engage in risky behaviour.

Conscientious people live longer than less conscientious people, because they tend to take better care

of themselves and engage in fewer risky behaviour. Still there are downsides to conscientiousness. It appears that conscientious people, probably because they’re so organized and structured, don’t adapt as well to changing contexts. Conscientious people are generally performance-oriented They have more trouble than less conscientious people learning complex skills early in the training process because their focus is on performance rather than on learning. Finally, conscientious people are often less creative than less conscientious people, especially artistically.

5. Identify other personality traits relevant to OB.

Although the Big Five traits have proven to be highly relevant to OB, they don’t exhaust the range of traits we can use to describe someone’s personality. Now we’ll look at other, more specific,

personality attributes that have been found to be powerful predictors of behaviour in organizations:

 Core self-evaluation  the degree to which an individual likes or dislikes himself or herself,

whether the person sees himself or herself as capable and effective, and whether the person feels in control of his or her environment or powerless over the environment. We discussed in chapter 3 that core self-evaluations relate to job satisfaction because people with positive core self-evaluations see more challenge in their job and actually attain more complex jobs. They also perform better than others because they set more ambitious goals, are more committed to their goals and persist longer at attempting to reach these goals.

 Machiavellianism  the degree to which an individual is pragmatic, maintains emotional distance and believes that ends can justify means. ‘If it works, use it,’ is consistent with a high-Mach perspective. High Machs manipulate more, win more, are persuaded less and persuade others more than do low Machs. Yet high-Mach outcomes are moderated by situational factors. It has been found that high Machs flourish:

 when they interact face-to-face with others rather than indirectly

 when the situation has a minimal number of rules and regulation, thus allowing

latitude for improvisation

 when emotional involvement with details irrelevant to winning distracts low Machs.

Thus, whether high Machs make good employees depends on the type of jobs.

 Narcissism  the tendency to be arrogant, have a grandiose sense of self-importance, require

excessive admiration and have a sense of entitlement. Narcissists are rated by their bosses as less effective at their jobs than others, particularly when it comes to helping others.

 Self-monitoring  a personality trait that measures an individual’s ability to adjust his or her behaviour to external, situational factors. Individuals high in self-monitoring show

considerable adaptability in adjusting their behaviour to external situations. High self-monitors are capable of presenting striking contradictions between their public persona and their private self. Evidence indicates that high self-monitors tend to pay closer attention to the behaviour of others and are more capable of confirming than are low self-monitors. They also receive better performance ratings, are more likely to emerge as leaders, and show less commitment to their organizations. In addition, high self-monitoring managers tend to be more mobile in their careers, receive more promotions (both internal and cross-organizational), and are more likely to occupy central positions in an organization.

 Risk taking  people differ in their willingness to take chances. This propensity to assume or

avoid risk has been shown to have an impact on how long it takes managers to make a decision and how much information they require before making a choice. High risk-taking managers make more rapid decisions and use less information in making their choices than did the low risk-taking managers. Interestingly, decision accuracy was the same for both groups.

 Type A personality  aggressive involvement in a chronic, incessant struggle to achieve

more and more in less and less time and, if necessary, against the opposing efforts of other things or other people. Type A’s:

1. are always moving, walking and eating rapidly

2. feel impatient with the rate at which most events take place 3. strive to think or do two or more things at once

4. cannot cope with leisure time

5. are obsessed with numbers, measuring their success in terms of how many or how much of everything they acquire.

In contrast to the Type A personality is the Type B, who is exactly opposite. Type B’s are  rarely harried by the desire to obtain a wildly increasing number of things or participate in an endless growing series of events in an ever-decreasing amount of time. They never suffer from a sense of time urgency with is accompanying impatience, can relax without guilt and so on.

Type A’s do better than Type B’s in job interviews, because they are more likely to be judged as having desirable traits such as high drive, competence, aggressiveness and success

motivation.

 Proactive personality  people who identify opportunities, show initiative, take action and

persevere until meaningful change occurs. Not surprisingly, proactives have many desirable behaviours that organizations cover. Evidence indicates that proactives are more likely than others to be seen as leaders and more likely to act as change agents within an organization. Other actions of proactives can be positive or negative, depending on the organization and the situation.

Although personality and values are related, they’re not the same. Values are often specific and describe belief systems rather than behavioural tendencies. Some beliefs or values don’t say much about a person’s personality, and we don’t always act in ways that are consistent with our values.

6. Define values, demonstrate the importance of values and contrast terminal and instrumental values.

Values  basic convictions that 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. They contain a judgemental element in that they carry an individual’s ideas as to what is right, good or desirable. Values have both content and intensity attributes.

 The content attribute says that a mode of conduct or an end-state of existence is important.

 The intensity attribute specifies how important it is.

Value system  a hierarchy based on a ranking of an individual’s values in terms of their intensity.

This system is identified by the relative importance we assign to values such as freedom, pleasure, self-respect, honesty, obedience and equality.

Values are important to the study or OB because they lay the foundation for our understanding of people’s attitudes and motivation and because they influence our perceptions. Values cloud objectivity and rationality. Values generally influence attitudes and behaviour.

Terminal values  desirable end-states of existence, the goals a person would like to achieve during

their lifetime.

Instrumental values  preferable modes of behaviour or means of achieving one’s terminal values.

7. Identify the dominant values in today’s workforce.

Contemporary work values  whilst it must be recognised that there will be significant variations

within groups, it is useful to recognise that groups tend to reflect similar values and this can be a valuable aid in explaining and predicting behaviour.

Linking individual’s personality and values to the workplace:

 Personality-job fit theory  a theory that identifies six personality types and proposes that

the fit between personality type and occupational environment determines satisfaction and turnover. It presents six personality types and proposes that satisfaction and the propensity to

leave a position depend on the degree to which individuals successfully match their personalities to a job. The key points of this model are:

1. There do appear to be intrinsic differences in personality among individuals. 2. There are different types of jobs.

3. People in jobs congruent with their personality should be more satisfied and less likely to voluntarily resign than people in incongruent jobs.

 Personality-organization fit  if an organization faces a dynamic and changing environment

and requires employees who are able to readily change tasks and move easily between teams, it is more important that employees’ personalities fit with the overall organization’s culture than with the characteristics of any specific job. People are attracted to and selected by organizations that match their values, and they leave organizations that are not compatible with their personalities. The fit of employees’ values with the culture of their organization predicts job satisfaction, commitment to the organization, and low turnover.

8. Identify Hofstede’s fine value dimensions of national culture.

The five personality factors identified the Big Five model appear in almost all cross-cultural studies. Differenes tend to be in the emphasis on dimensions and whether countries are predominantly individualistic or collectivistic.

Because values differ across cultures, an understanding of these differences should be helpful in explaining and predicting behaviour of employees from different countries.

On one of the most widely referenced approaches for analysing variations among cultures was done by Hofstede. He surveyed more than 116.000 IBM employees in 40 countries about their work-related values and found that managers and employees vary on five value dimensions of national culture:

 Power distance  a national culture attribute that describes the extent to which a society

accepts that power in institutions and organizations is distributed unequally.

 Individualism  a national culture attribute that describes the degree to which people prefer

to act as individuals rather than as members of groups.

Collectivism  a national culture attribute that describes a tight social framework in which

people expect others in groups of which they are a part to look after them and protect them.

 Masculinity  a national culture attribute that describes the extent to which the culture

favours traditional masculine work roles of achievement, power and control. Societal values are characterised by assertiveness and materialism.

Femininity  a national culture attribute that has little differentiation between male and

female roles, where women are treated as the equals of men in all aspects of the society.

 Uncertainty avoidance  a national culture attribute that describes the extent to which a

society feels threatened by uncertain and ambiguous situations and tries to avoid them.

 Long-term orientation  a national culture attribute that emphasises the future, thrift and

Short-term orientation  a national culture attribute that emphasises the past and present

respect for tradition and fulfilment of social obligations.

Despite a few concerns, Hofstede has been one of the most widely cited social scientists ever, and his framework has left a lasting mark on OB.

The GLOBE team identified nine dimensions on which national cultures differ. The main difference with Hofstede is that it added dimensions, such as humane orientation and performance orientation.

Chapter 5: Perception and individual decision making

1. Define perception and explain the factors that influence it.

Perception  a process by which individuals organize and interpret their sensory impressions in

order to give meaning to their environment. People’s behaviour is based on their perception of what reality is, not on reality itself. The world as it is perceived is the world that is behaviourally important. A number of factors operate to shape and sometimes distort perception. These factors can reside in the perceiver, the target or the situation in which the perception is made  see page 111.

2. Explain attribution theory and list the three determinants of attribution.

Attribution theory  an attempt to determine whether an individual’s behaviour is internally or

externally caused. Internally caused behaviours are those we believe to be under the personal control of the individual. External caused behaviour is what we imagine the situation forced the individual to do. That determination depends largely on three factors:

1. Distinctiveness  refers to whether an individual displays different behaviours in different situations.

2. Consensus  if everyone who faces a similar situation responds in the same way. 3. Consistency  does the person respond the same way over time?

Errors or biases distort attributions.

 Fundamental attribution error  the tendency to underestimate the influence of external

factors and overestimate the influence of internal factors when making judgements about the behaviour of others. We blame people first, not the situation.

 Self-serving bias  the tendency for individuals to attribute their own successes to internal

factors and put the blame for failures on external factors. It is our success but their failure.

3. Identify the shortcuts individuals use in making judgements about others.

We use a number of shortcuts when we judge others. These techniques are frequently valuable: they allow us to make accurate perceptions rapidly and provide valid data for making predictions. However, they are not foolproof. They can do get us into trouble.

 Selective perception  the tendency to selectively interpret what one sees on the basis of

one’s interest, background, experience and attitudes. It allows us to speed-read others, but not without the risk of drawing an inaccurate picture. Because we see what we want to see, we can draw unwarranted conclusions from an ambiguous situation.

 Halo effect  the tendency to draw a general impression about an individual on the basis of a

 Contrast effects  evaluation of a person’s characteristics that is affected by comparisons with other people recently encountered who rank higher or lower on the same characteristics.

 Stereotyping  judging someone on the basis of one’s perception of the group to which that

person belongs. One specific manifestation of stereotypes is profiling  a form of

stereotyping in which a group of individuals is singled out – typically on the basis of race or ethnicity – for intensive inquiry, scrutiny or investigation. One of the problems of stereotyping is that they are widespread and often useful generalisations, despite the fact that they may not contain a shred of truth when applied to a particular person or situation.

In many cases, our judgements have important consequences for the organization:

 Employment interview  evidence indicates that interviewers make perceptual judgements

that are often inaccurate. They generally draw early impressions that very quickly become entrenched.

 Performance expectations  people attempt to validate their perceptions of reality, even

when those perceptions are faulty. This characteristic is particularly relevant when we consider performance expectations on the job. The terms self-fulfilling prophecy and Pygmalion effect have evolved to characterise the fact that an individual’s behaviour is determined by other people’s expectations. Self-fulfilling prophecy  a situation in which a person inaccurately perceives a second person, and the resulting expectations cause the second person to behave in ways consistent with the original perception.

 Performance evaluation  subjective evaluations of performance, though often necessary,

are problematic because of all the errors we’ve discussed thus far affect them.

4. Explain the link between perception and decision making.

Individuals in organizations make decisions  they make choices from among two or more alternatives. Individual decision making is an important part of organizational behaviour. But how individuals in organizations make decisions and the quality of their final choices are largely influenced by their perceptions.

Decision making occurs as a reaction to a problem  a discrepancy between the current state of affair and some desired state. The awareness that a problem exists and whether a decision needs to be made is a perceptual issue.

5. Apply the rational model of decision making and contrast it with bounded rationality and intuition.

Business schools generally train students to follow rational decision-making models. If we are to improve how we make decisions in organizations, we need to understand the decision-making errors that people commit.

We often think the best decision maker is rational  characterised by making consistent, value-maximising choices with specified constraints. These decisions follow a six-step rational

decision-making model  a decision-decision-making model that describes how individuals should behave in order to

maximize some outcome.

1. Define the problem 4. Develop the alternatives

2. Identify the decision criteria 5. Evaluate the alternatives

3. Allocate weights to the criteria 6. Select the best alternative

 Well-defined problem

 Clear criteria and criteria rating

 Complete (or at least reliable) information

 Stable preferences  ability to identify all the relevant options in an unbiased manner. The limited information-processing capability of human beings makes it impossible to assimilate and understand all the information necessary to optimise. So people satisfice, that is, they seek solutions that are satisfactory and sufficient.

Bouded rationality  a process of making decisions by constructing simplified models that extract

the essential features from problems without capturing all their complexity. So the solution represents a satisficing choice, the first acceptable one we encounter, rather than an optimal one.

Intuitive decision making  an unconscious process created out of distilled experience. Its defining

qualities are that it occurs outside conscious thought: it relies on holistic associations, or links between disparate pieces of information, it is fast, and it is affectively charged, meaning that it usually engages the emotions. There is growing recognition that rational analysis has been overemphasised and that, in certain instances, relying on intuition can improve decision making. But while intuition can be

invaluable in making good decisions, we can’t rely on it too much. Because it is so unquantifiable, it is hard to know when our hunches are right or wrong. The key is not to either abandon or rely solely on intuition but to supplement it with evidence and good judgement.

6. List and explain the common decision biases or errors.

Decision makers engage in bounded rationality, but an accumulating body of research tells us that decision makers also allow systematic biases and errors to creep into their judgements. These come from attempts to shortcut the decision process. To minimise effort and avoid difficult trade-offs, people tend to rely too heavily on experience, impulses, gut feelings and convenient rules of thumb. In many instances, these shortcuts are helpful. However, they can lead to severe distortions of rationality. There are three meta biases that result in decision biases:

 Availability shortcut

 Availability bias  the tendency for people to base their judgements on information

that is readily available to them, leads to over or underestimation.

 Anchoring bias  a tendency to fixate on initial information, from which one then

fails to adequately adjust for subsequent information.

 Self enhancement

 Self-serving attributions

 Confirmation bias  the tendency to seek out information that reaffirms past

choices and to discount information that contradicts past judgements. The rational decision-making process assumes that we objectively gather information, but we don’t. We selectively gather it.

 Escalation of commitment  an increased commitment to a previous decision in spite of negative information.

 Egocentric accounting  occurs when people claim more responsibility for

themselves for the results of a joint action than an outside observer would credit them.

 Better-than-average-effect  the tendency for people to evaluate themselves as

better than average on desirable skills, characteristics and behaviours.

 Low self-esteem (accurate self-assessment)  are generally accurate in assessing

their competencies relative to others.

 Illusion of control

 Illusory correlations  seeing the relationship one expects in a set of data even

when no such relationship exists.

 Hindsight bias  the tendency to believe falsely, after an outcome of an event is

actually known, that one would have accurately predicted that outcome.

 Overconfidence bias

 Victim blaming  holding the victims of a crime, an accident or any type of abuse

maltreatment to be entirely or partially responsible for the unfortunate incident.

Randomness error  the tendency of individuals to believe that they can predict the outcome of

random events. At the extreme, some decision makers become controlled by their superstitions, making it nearly impossible for them to change routines or objectively process new information.

Winner’s curse  a decision-making dictum which argues that the winning participants in an auction

typically pay too much for the winning item. Logic predicts that the winner’s curse gets stronger as the number of bidders increases. The more bidders there are, the more likely that some of them have greatly overestimated the good’s value. So, beware of auctions with an unexpectedly large number of bidders.

7. Explain how individual differences and organizational constraints affect decision making.

Individual differences create deviations from the rational model.

 Personality  two facets of conscientiousness, namely achievement striving and dutifulness,

have opposite effects on escalation of commitment. First, achievement striving people are more likely to escalate their commitment, whereas dutiful people are less likely. Second, achievement striving individuals appear to be more susceptible to the hindsight bias. Finally, people with high self-esteem appear to be especially susceptible to the self-serving bias.

 Gender  overall, the evidence indicates that women analyse decisions more than men do.

Rumination refers to deflecting at length. In terms of decision making, it means overthinking

problems. Women, in general, are more likely than men to engage in rumination.

Organizations can constrain decision makers, creating deviations from the rational model.

 Performance evaluation  managers are strongly influenced in their decision making by the

criteria on which they are evaluated.

 Reward systems  influences decision makers by suggesting to them what choices are

preferable in terms of personal payoff.

 Formal regulations  intended to get individuals to act in the intended manner. In so doing,

 System-imposed time constraints  organizations impose deadlines on decisions. These conditions create time pressures on decision makers and often make it difficult, if not

impossible, to gather all the information they might like to have before making a final choice.

 Historical precedents  choices made today are largely a result of choices made over the

years.

8. Contrast the three ethical decision criteria.

Ethical considerations should be an important criterion in organizational decision making. There are three different ways to frame decisions ethically.

1. Utilitarianism  a system in which decisions are made to provide the greatest good for the greatest number. It promotes efficiency and productivity, but can result in ignoring the rights of some individuals, particularly those with minority representation in the organization. 2. Rights  this calls on individuals to make decisions consistent with fundamental liberties and

privileges, as set forth in documents such as the European Convention on Human Rights.

Whistle-blowers are individuals who report unethical practices by their employer to outsiders.

The use of rights as a criterion protects individuals from injury and is consistent with freedom and privacy, but it can create an overly legalistic work environment that hinders productivity and efficiency.

3. Justice  requires individuals to impose and enforce rules fairly and impartially so that there is an equitable distribution of benefits and costs. It protects the interests of the

underrepresented and less powerful, but it can encourage a sense of entitlement that reduces risk taking, innovation and productivity.

9. Define creativity and discuss the three-component novel and useful ideas.

Creativity  the ability to produce novel and useful ideas. It allows the decision maker to more fully

appraise and understand the problem, including seeing problems others can’t see.

Most people have creative potential they can use when confronted with a decision-making problem. But to unleash that potential, they have to get out of the psychological ruts many of us fall into and learn how to think about a problem in divergent ways. People who score high on openness to experience and intelligence are more likely than others to be creative. Other traits associated with creative people include independence, self-confidence, risk taking, an internal locus of control, tolerance for ambiguity, a low need for structure and perseverance in the face of frustration.

Three-component model of creativity  the proposition that individual creativity requires expertise,

creative thinking skills and intrinsic task motivation.

 Expertise is the foundation for all creative work. The potential for creativity is enhanced when individuals have abilities, knowledge, proficiencies, and similar expertise in their field of endeavour.

 Creative-thinking skills encompasses personality characteristics associated with creativity, the ability to use analogies, and the talent to see the familiar in a different light.

 Intrinsic task motivation is the desire to work on something because it’s interesting involving, exciting, satisfying or personally challenging. This motivational component is what turns creativity potential into actual creative ideas.

Chapter 6: Motivation concepts

1. Define the three key elements of motivation

Motivation  the processes that account for an individual’s intensity, direction and persistence of

effort toward attaining a goal. While general motivation is concerned with effort toward any goal, we’ll narrow the focus to organizational goals in order to reflect our singular interest in work-related behaviour. The three key elements in our definition are:

1. Intensity  how hard a person tries.

2. Direction  effort that is channelled toward, and consistent with, organizational goals 3. Persistence  how long a person can maintain effort.

2. Identify four early theories of motivation and evaluate their applicability today.

Early motivation theories represent a foundation from which contemporary theories have grown, and practising managers still regularly use these theories and their terminology in explaining employee motivation.

Maslow’s hierarchy of needs theory  a hierarchy of five needs in which, as each need is substantially satisfied, the next need becomes dominant.

 Physiological  includes hunger, thirst, shelter, sex and other bodily needs.

 Safety  security and protection from physical and emotional harm.

 Social  affection, belongingness, acceptance and friendship.

 Esteem  internal factors such as self-respect, autonomy and achievement, and external

factors such as status, recognition and attention.

 Self-actualisation  drive to become what one is capable of becoming: includes growth,

achieving one’s potential and self-fulfilment.

From the standpoint of motivation, the theory would say that although no need is ever fully gratified, a substantially satisfied need no longer motivates. So if you want to motivate someone, you need to understand what level of the hierarchy that person is currently on and focus on satisfying the needs at or above that level.

Lower-order needs are physiological and safety needs. Higher-order needs are social, esteem and

self-actualisation needs. The differentiation between the two orders was made on the premise that higher-order needs are satisfied internally, whereas lower-order needs are predominantly satisfied externally.

Alderfer attempted to rework Maslow’s need hierarchy to align it more closely with empirical

research. His revised need hierarchy is labelled ERG theory  a theory that posits the three groups of core needs: existence, relatedness and growth. He didn’t assume that these needs existed in a rigid hierarchy. An individual could be focusing on all three need categories simultaneously.

McGregor’s Theory X  the assumption that employees dislike work, are lazy, dislike responsibility and must be coerced to perform.

McGregor’s Theory Y  the assumption that employees like work, are creative, seek responsibility and can exercise self-direction.

Herzberg proposed the two-factor theory also called motivation-hygiene theory  a theory that relates to intrinsic factors to job satisfaction and associates with extrinsic factors with dissatisfaction. Removing dissatisfying characteristics from a job does not necessarily make the job satisfying. So the opposite of satisfaction is no satisfaction, and the opposite of dissatisfaction is no dissatisfaction.

Hygiene factors  factors – such as company policy and administration, supervision and salary –

that, when adequate in a job, people will not be dissatisfied, neither will they be satisfied. The criticisms of the theory include the following:

 The procedure that Herzberg used is limited by its methodology. When things are going well,

people tend to credit themselves. Contrarily, they blame failure on extrinsic environment.

 The reliability of Herzberg’s methodology is questioned.

 No overall measure of satisfaction was utilised.

 Herzberg assumed a relationship between satisfaction and productivity, but the research

methodology he used looked only at satisfaction and not at productivity.

McCelland’s theory of needs  a theory which states that achievement, power and affiliation are

three important needs that help explain motivation.

 Need for achievement (nAch)  the drive to excel, to achieve in relationship to a set of

standards and to strive to succeed.

 Need for power (nPow)  the need to make others behave in a way in which they would not

have behaved otherwise.

 Need for affiliation (nAff)  the desire for friendly and close interpersonal relationships. First, when jobs have a high degree of personal responsibility and feedback and an intermediate degree of risk, high achievers are strongly motivated. Second, a high need to achieve does not necessarily make someone a good manager, especially in large organizations. Third, the needs for affiliation and power tend to be closely related to managerial success. The best managers are high in their need for power and low in their affiliation.

There are a number of contemporary theories that have a reasonable degree of valid supporting documentation.

3. Apply the predictions of cognitive evaluation theory to intrinsic and extrinsic rewards.

Cognitive evaluation theory  a theory which states that allocating extrinsic rewards for behaviour

that has been previously intrinsically rewarding tends to decrease the overall level of motivation. If cognitive evaluation theory is correct, it would make sense to make an individual’s pay noncontingent on performance in order to avoid decreasing intrinsic motivation. Verbal extrinsic rewards increase intrinsic motivation, whereas tangible extrinsic rewards undermine it.

Self-concordance  the degree to which a person’s reasons for pursuing a goal is consistent with the

person’s interests and core values. People who pursue work goals for intrinsic reasons are more satisfied with their jobs, feel like they fit into their organizations and may perform better.