Introduction
Organizational Behavior or OB is an emerging science that deals with the study of how people act and behave in an organization. For the same reason, the theories behind OB are closely related with social psychology as it deals with individuals and organizational behavior and how they are interrelated with each other. Owing to its psychological framework, OB has a wide scope as it encompass a variety of organizational studies such as organizational performance, employee motivation, leadership, team building, organizational structures an organizational management among many other organizational disciplines. The purpose of this paper is to determine how OB developed based on review of literature and to determine why it is necessary to study OB and how does OB relates to achieving success in an organization.
Historical Perspective
Studies in Organizational Behavior has split in two separate line of thoughts; one is focused on how individual behavior influence organizational behavior while the other is focused on how organizational behavior influence how people behave in an organization or in a group. During the 1900’s, organization theories are heavily influenced by the scientific management approach of Frederick Taylor. As a production engineer, Taylor observed that he can improve production efficiency and quantify results by studying worker movements as they timed their work. He broke down each job into separate components and devised methods on how each components can be efficiently completed In just about the same year, as the Taylor is experimenting on production work, Max Weber was also developing the bureaucratic view on organizations. According to Weber, effective organizations must be modeled like a machine wherein every part has a specialized function and contributes significantly to the holistic function of an organization. Among the major contribution of Weber is on how organizations developed into bureaucratic institutions wherein organizational hierarchy or chain of command is being observed. Although Taylor’s and Weber’s scientific and bureaucratic approach may be considered as too impersonal and technical, it inspired numerous studies in organizational behavior. One of which is the emergence of the Human Relations movement in 1924 as a result of the ‘Hawthorne experiment’. The Hawthorne experiment was a brainchild of Western Electric Company, an electric company, which aims to research and establish the relationship between lighting and productivity. Primarily, the experiment was made in order to convince industries to use more lights with an underlying objective of increasing their electric usage for the benefit of Western Electric Company. Human subjects were chosen for the experiment and while the experiment did not yield the expected results, it made a different turn wherein personal and environmental aspects were considered and how it relates to the productivity of each workers . Several important organizational behavior implications can be drawn from the Hawthorn experiment. One of which is that individual aptitudes are poor indicators of performance; rather, it is the environmental factors that can strongly influence the individual’s potential. The Hawthorne experiment also helped identify the work environment as a social system. In this view, organizational behavior owes a great deal of its approach to behavioral studies of individuals and organizations and how they collectively influence each other. Organizations being a social system lead to the development of team building and team dynamics. Through these major contributions to organizational studies, OB has emerged as an effective tool in decision making and developing organizational strategies.
Importance of Studying Organizational Behavior
Inadequate knowledge about organizations and how they behave have led to epic management and leadership failures. One particular example is the case of International Business Machine (IBM). IBM is considered as the as the world’s largest information technology company. Since its founding in 1911, IBM has lead IT innovations and has established a strong market base. For years, the company dominated the industry and developed into a strong bureaucratic institution. However, as the company grew and expanded, it somehow lost its innovative strategies and creativity. According to observers, the company’s success has changed the company in such a way that it cultivated a culture of excessive corporate pride and prejudice. As observed by Mills, “IBM’s lengthy study of decisions before they could be made, its emphasis on consensus, its interminable executive meetings that focused on ideas and plans, not operating results, its full employment practice that became a refuge for poor performers — all were rendered obsolete in a more competitive, rapidly changing business environment”. Although IBM’s organizational behavior is apparently becoming a huge stumbling block to its success, changing the organization for the better is a challenging process that requires a thorough understanding of OB. Consider the case of Hewlet Packard and its former CEO, Carly Fiorina. In trying to facilitate change, Fiorina, embarks on several change initiatives she believed would help HP achieve its goals; one of which is facilitating the merger of HP and Compaq. However, her vision of change was met with skepticism and in the end, Fiorina suffered the consequences. Fiorina’s failure was due in part to her ineffective business strategy and also on her failure to observe HP’s organizational culture. Accordingly, HP’s culture is not yet ready for the drastic changes made by Fiorina since the company is personified by “gentle bureaucracy of entitlement and consensus” (Hoopes, C., 2011). Another case of blindly following a business strategy while failing to recognize OB that led to failure was the case of Ron Johnson and J.C. Penny. Johnson was a former Apple executive who left the company to become J.C. Penny’s CEO in 2011. Ron Johnson made several changes to the company that is quite drastic. First, he got rid of the company’s long-time ad agency Saatchi & Saatchi and M Booth & Associates, the company’s public relations agency for 6 years. Johnson also got rid of the numerous promotions and discounts that the company offers. Accordingly, J.C. Penney offered 590 promotions however 99% of the customers are just ignoring it and so he decided to cut the number down to 12. To top it off, Johnson overhauled the company’s organizational structure by chopping-off several company executives and employees. He also took away employee incentives in an attempt to increase the company’s savings. It shows that Johnson’s attempt to initiate a wide scale organizational change did not prosper primarily because he failed to incorporate organizational behavior into his business strategies. The organizational changes that he initiated came in conflict with the company’s long-held culture and values.
Impacts of Organizational Behavior in Business Environments
The objectives of OB, which is to understand, explain and improve the attitudes of individuals and groups within an organization, have significant applications especially in the field of management. Today, management techniques are focused on the development of the individual and teams within an organization by employing a combination of OB theories since the scientific management era up to the present. This current management style is termed as ‘Dynamic Engagement Approach’ by Thenmozhi to convey the flexible and ever-changing techniques that address the rapid changes in today’s business scenario. This dynamic engagement approach recognizes that “an organization environment is not some set of fixed, impersonal forces but rather a complex, dynamic, web at people interacting with each other”. Most successful organizations employ a combination of scientific management, bureaucratic management and human relations approach; all of which maintains a close relation with organizational behavior. It is imperative that organizations should change in line with the changing business environment. For the same reason, it is imperative that leaders should make their organizations adapt to these changes as smoothly as possible by applying knowledge on OB. Because of these imperative changes, management styles may evolve when dealing with a particular situation and organization. Accordingly, “an important key to successful leadership is to know how, when and how much of what leadership style is needed in a particular situation”. Environmental, societal and political factors could certainly influence a manager’s approach to a particular scenario, which is the very objective of studying and understanding organizational behavior. The influence of OB in management is readily observable in organizational change models. One particular example is the McKinsey 7-S model, which was developed by Tom Peters, Robert Waterman, Julien Philips, Richard Pascale and Anthony G. Athos in 1980 while working as consultants for McKinsey & Co. In this change model, Peters point out that organizational change attributes such as strategy, structure, systems, skills, staff and style are all interconnected with each other and compliments the central attribute, which is shared values. Aside from facilitating smooth organizational changes, by incorporating OB to an individual’s leadership style could certainly improve leadership quality. Steve Jobs, Apple’s founder, has learned this the hard way when he was once fired from the company he founded. Initially, Jobs leadership with Apple before he was fired was temperamental and immature. For the same reason, his personality issues came in conflict with Apple’s board, which eventually got him in trouble and was the main reason why he was fired. Even so, this event became a turning point in Job’s leadership career that eventually changed him for the better.
Conclusion
Organizational Behavior can be considered as an integral part of an organization and all its elements. Historically, it became increasingly apparent when businesses have grown into large corporate entities wherein understanding of individual and group behavior became a subject of interest in order to improve an organization’s efficiency. For years, Organizational Behavior has developed to include every aspect of individual and organizational attributes. In fact, it developed into a collective study of social interaction within an organization. The new challenges in organizations such as change and leadership challenges place emphasis on understanding O.B. Today, it is accepted that understanding organizational behavior is essential in developing successful organizations. Also, it helps individuals and groups within the organization to develop their personalities and strategies in line with the organization’s values and culture. While individuals influence organizations, in the same way, organizations exert an equally potent influence on an individual, which if he fails to recognize, could become his pitfall. In real life scenarios, failure to recognize organizational behavior has made organizations and business leaders to fail. In the same way, knowledge about organizational behavior has made businesses and their leaders succeed.
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