MBA 612 OB Ch.1

Chapter One
An Overview of
Organizational Behavior
Chapter Learning Objectives
After studying this chapter you should be able to:

• Define organizational behavior (OB);
• Explain the three units of analysis in OB;
• Describe the development of OB;
• Figure out the relationship of OB with other areas of studies;
• Explain the current challenges and opportunities in organizations.

Discussion Questions
Dear students! how did you understand the following concepts:
1. What is organization?
2. What is behavior?
3. What is organizational behavior?

What is Organization?
Well done !
• Organization is a group of two or more people working together to
achieve some common objectives.
• It is a collection of people working together under a defined structure

for the purpose of achieving predetermined outcomes through the use
of financial, human, and material resources.
What is Behavior ?
• Behavior is the way in which an animal or person responds

to a situation;
• Behavior refers to
• What people do in the organization,

• What their attitudes are,
• How they perform.
1.1 What is Organizational Behavior?
• Is the study of behavior in organizations.
• 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.
What is Organizational Behavior?
(Cont’d)
Key Points
• First organizational behavior is an investigative study of
individuals and groups,
• Second, the impact of organizational structure on human
behavior and
• Third, the application of knowledge to achieve
organizational effectiveness.
What is Organizational Behavior?
(Cont’d)
• The study of organizational behavior embraces an
understanding of:
• The behavior of people;
• The process of management;
• The organizational context in which the process of management takes
place;
• Organizational processes and the execution of work; and
• Interactions with the external environment of which the organization
is part.
1.2 The 3 Basic Units of Analysis in OB
• The individual
• Group behavior and
• Organization structure and job design.

The 3 Basic Units of Analysis in OB
(Cont’d)
I. The individual
─ Understanding people, from the perspective of individual
organizational member.
─ Much of what we know about individuals is drawn from the

discipline of psychology
─ Theories of motivation and satisfaction to understand behavior and

performance of individual organizational members.
(Cont’d)
II. Group Behavior
 Focus on:-
• The interactions of people as they work together in groups
• Group cohesiveness and productivity
• leadership influence on group members cooperation and productivity
• This level of analysis draws in particular on theories from social

psychology.
(Cont’d)
III. Organizational Structure and Job Design
• The 3rd level of analysis has to do with the way

• organizations are formally structured and
• in which jobs are designed.
1.3 Characteristics of OB
1. Organizations are composed of individuals and

groups
2. Organizations are oriented toward the

achievement of goals
3. Organizations need employees’ specialization

and coordination in order to accomplish their
goals
1.4 The Development of OB
• Organizational behavior emerged as a distinct field around 1940s.
• Four significant Eras; have paved the way for the field of
organizational behavior.
• Pre-scientific,
• Classical,
• Behavioral and
• Modern
The Development of OB (Cont’d)
1 The pre-scientific Era (pre1000-1880)

• The practice of management can be traced to ancient civilizations
• Even though, managers during the pre-scientific era did not have formal
education and training in proven management methods, they
accomplished amazing things.
2) The classical Era(1980-1930)

• During this time, the first theory of management began to evolve.
• Two major thrusts were:

• Administrative theory:- emphasized the flow of information and how
organizations should operate.
• Scientific management:- focused on the manufacturing environment and
getting work done on the factory floor.
3) The Behavioral or Neo-classical Era (1930-1960)
• Managing and understanding the behavior of people in the behavioral Era
was the outcomes of the human relation movement during the 1930s.
• The term human-relation refers to the manner in which managers interact

with subordinates.
• Unique combination of factors fostered the human relation movement

during the 1930s.
• Collective bargaining
• Attention for the ‘human’ factors
06/22/2023 21
4) The Modern Era (1960 onwards)
• Douglas McGregor,
• The total quality management movement, and
• The contingency approach to management

1.5 Contributing Disciplines to OB
Many behavioral sciences
have contributed to the
development of Organizational
Behavior
Psychology
Social
Psychology
Sociology Anthropology
Contributing Disciplines to OB (Cont’d)
Psychology
The science that seeks to measure, explain, and sometimes
change the behavior of humans and other animals
Sociology
The study of people in relation to their fellow human beings
Social Psychology
An area within psychology that blends concepts from psychology
and sociology and that focuses on the influence of people on one
another
Anthropology
The study of societies to learn about human beings and their
activities
1.6 Management and OB in the 21st
Century
• Workplace is indeed undergoing immense and
permanent changes.
• Requires new-taking & new ways of managing.
• The nature of work is changing so rapidly.

Management and OB in the 21st
Century (Cont’d)
There is a revolution going on in the workplace such as:
• Knowledge is replacing infrastructure.
• Values and Self-leadership are replacing direct supervision
• Networks are replacing hierarchies.
• Virtual teams are replacing committees.
• Companies are looking for employees with emotional intelligence, not

just technical smarts.
• Globalization has become the mantra of corporate survival.
06/22/2023 29
Management and OB in the
21st Century (Cont’d)
The following areas are the area in which the managers’ of modern
organizations are being encountered challenges
• Improving Quality and Productivity
• Improving people skills
• Managing work force diversity
• Responding to globalization
• Empowering people
Management and OB in the 21st
Century (Cont’d)
• Stimulating innovation and change
• Coping with “Temporariness” – today, change is an ongoing activity for
most managers. So, workers need to continually update their knowledge
and skills to perform new job requirements.
• Declining employee loyalty
• Improving ethical behavior
06/22/2023 31
Challenges and Opportunities for
OB
• Responding to Economic Pressures
• Responding to Globalization
• Managing Workforce Diversity
• Improving Quality and Productivity
• Improving Customer Service
• Improving People Skills
1-32
Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Challenges and Opportunities for
OB (Cont’d)
• Stimulating Innovation and Change
• Coping with “Temporariness”
• Working in Networked Organizations
• Helping Employees Balance Work-Life Conflicts
• Creating a Positive Work Environment
• Improving Ethical Behavior
06/22/2023 33
End of chapter One
• Thank you!
06/22/2023 34

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Chapter One

After studying this chapter you should be able to:

• Explain the three units of analysis in OB;

• Describe the development of OB;

• Figure out the relationship of OB with other areas of studies;

• Explain the current challenges and opportunities in organizations.

Dear students! how did you understand the following concepts:

3. What is organizational behavior?

• It is a collection of people working together under a defined structure

• Behavior is the way in which an animal or person responds

• What people do in the organization,

• A field of study that investigates the impact

• Group behavior and

• Organization structure and job design.

─ Much of what we know about individuals is drawn from the

─ Theories of motivation and satisfaction to understand behavior and

• This level of analysis draws in particular on theories from social

III. Organizational Structure and Job Design

• The 3rd level of analysis has to do with the way

1. Organizations are composed of individuals and

2. Organizations are oriented toward the

3. Organizations need employees’ specialization

1 The pre-scientific Era (pre1000-1880)

2) The classical Era(1980-1930)

• Two major thrusts were:

• The term human-relation refers to the manner in which managers interact

• Unique combination of factors fostered the human relation movement

• Attention for the ‘human’ factors

• The total quality management movement, and

• The contingency approach to management

• Requires new-taking & new ways of managing.

• The nature of work is changing so rapidly.

• Values and Self-leadership are replacing direct supervision

• Networks are replacing hierarchies.

• Virtual teams are replacing committees.

• Companies are looking for employees with emotional intelligence, not

• Globalization has become the mantra of corporate survival.

• Managing Workforce Diversity

• Improving Quality and Productivity

• Improving Customer Service

• Improving People Skills

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

• Coping with “Temporariness”

• Working in Networked Organizations

• Helping Employees Balance Work-Life Conflicts

• Creating a Positive Work Environment

• Improving Ethical Behavior

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