MBAFT 6101

OB- Revision
Class
BY DR REEMA AGGARWAL
 MBAFT 6101 OB
Unit I: Introduction to Organizational Behaviour; Management Functions, Skills and Roles
Unit II: Introduction to Individual Behaviour: Personality: Determinants, Measurement, Different Traits; Perception: Process, Factors,
Attribution Theory; Learning: Approaches, Measurement; Attitudes, Values and Emotions
Unit III: Interpersonal Relationship: Transactional Analysis: Ego States, Transactions, Life Positions, Stroke Analysis, Games
Analysis; Johari Window
Unit IV: Motivation at Work: Introduction, Content Models of Motivation, Process Models of Motivation, Use of Motivation
Unit V: Leadership and followership: Introduction, Trait, Behavioural and Contingency Approaches to leadership,
Transactional and Transformational leadership
Unit VI: Work teams and Groups: Introduction, Reasons for joining groups, Types of groups, Group Cohesiveness, Group Think and
Risky Shift
Unit VII: Decision Making: Introduction, Types of Decision, Process of Decision, Individual and Group Decision Making Models
Unit VIII: Stress and Well -being at work: Introduction, Sources, Reaction and
Unit IX: Organization Structure and Design
 Unit I

✓Meaning of organisation, Types of Organisation

✓Challenges and opportunities in OB/ Managerial implication
✓Major disciplines that contribute in OB
✓Level of analysis in OB
✓What do managers do?-
✓Management functions and managerial roles
✓Managerial skills
✓Models in OB
 Unit II

Meaning of Types of Big 5 Type A and Other

Personality Personality MBTI personality Type B personality
traits personality traits

Theories of How it is How it Perception- Perception

Determinants Personality developed influences OB handout is process
and measured given

Errors and Frequently Importance of

Attribution biases in used shortcuts perception in Learning Values
theory attribution in judging OB
others

Attitudes Emotions Emotional

Intelligence
 Meaning of Personality
✓Personality refers to the sum total of ways in which an individual reacts and interacts with
others.
✓Personality is the relatively stable set of psychological and behavioral attributes that distinguish
one person from another.

Personality Determinants
• BIOLOGICAL FACTORS: Heredity; Physical Attributes
• Environment
• Situation
PERSONALITY TYPES
I. The “Big Five” Personality Factors

Openness to Experience
Conscientious
Extroversion
Agreeableness
Neuroticism
The “Big Five” personality traits
Extraversion sociable, outgoing, talkative, assertive

Conscientiousness Dependable, hardworking, organized,

self- disciplined, persistent, responsible
Emotiona Calm, Secure, happy, unworried
l
stability
Agreeableness cooperative, warm, caring, courteous, trusting
Openness Curious, intellectual, creative, flexible
to
experience
 The MBTI® Instrument

Was developed by Katharine C Briggs

and her daughter Isabel Briggs Myers
Based on the work of Swiss psychiatrist, C G Jung, who presented his psychological
type theory in his book entitled ‘Psychological Types’ published in 1921 and
translated into English in 1923.
 MBTI (the applicability and importance)

□Introversion
□ Extroversion

□ Intuition
□ Sensing

□ Feeling
□ Thinking

□ Judging □ Perceiving
 MBTI, the applicability and importance

□ Extroverts: energetic, displaying lots of emotional range. Likes

group, gain energy in groups, usually talk more and louder, talk
faster.

□ Introverts: Restrained physically, project calm and reserve, like to

use word “I”, they like to explore single topics in depth.
 MBTI, the applicability and importance

□ Sensor: emphasis on specific facts, tend to speak in short

phrases, Sensor dress fashionably.

□ Intuitive: Language is plaything, will report things with

feelings, tend to finish others’ sentences, ramble more.
■ T’s concentrate on achieving their desired
outcome – the partner/friend changes
clothes or they don’t go.
■ T’s are frank and to-the-point in stating
their views about the clothing.
■ F’s often say they don’t care what the
person is wearing.
■ F’s are often concerned about
embarrassing the person, take a tactful,
indirect approach.
Judger vs. perceiver

■ J’s plan everything to the nth degree, liking

to cover every contingency.
■ P’s leave things open, desiring flexibility.
INFJ INFP INTJ INTP

ENFJ ENFP ENTJ ENTP

ISFJ ISFP ISTJ ISTP
ESFJ ESFP ESTJ ESTP

16 Types
Type A vs Type B Personality

(Meyer Friedman and Ray Rosenman)

■ Competitive ■ Laid back

■ Deadline oriented ■ Flexible
■ Outcome oriented ■ Process Oriented
■ Time urgent ■ Time relaxed
■ Irritable ■ Calmer
 Psychoanalytic Theory and Sigmund
Freud, M.D.

FIGURE 10.6 The approximate relationship between the id, ego, and superego, and the levels
of awareness.
HOW PERSONALITY DEVELOPS?
Erikson’s Stages of Personality Development (Focused on social factor)
Sigmund Freud’s Stages of Personality Development (Focused on Biological factor)
 Personality can be measured through
several key methods:

[Link]-Report Questionnaires: Tools like the Big Five Inventory (BFI) or Myers-Briggs Type Indicator (MBTI)
ask individuals to assess their own behaviors and preferences, providing insights into their personality traits.
[Link] Methods: Personality is assessed based on observations of behavior in different situations.
Trained observers may evaluate how individuals react to various work or social scenarios.
[Link] Tests: Tests like the Inkblot Test use ambiguous stimuli to assess underlying thoughts and
personality traits by interpreting responses.
[Link] Assessments: Personality can be measured through workplace simulations or role-playing
scenarios where actions and reactions to specific tasks are observed and analyzed.
[Link] UNSTRUCTURED INTERVIEWS-Peer and 360-Degree Feedback : Colleagues or peers
provide feedback on an individual’s personality traits through surveys or structured interviews, adding an
external perspective to self-assessments.
 Why studying personality is crucial
for organization?
[Link] Hiring Decisions: Understanding personality ensures hiring candidates whose traits align with the job and
organizational culture.
[Link] Team Dynamics: Knowing employees' personalities helps create balanced teams, enhancing collaboration and
reducing conflicts.
[Link] Leadership: Personality insights guide leadership development and ensure leaders adopt styles that best
motivate their teams.
[Link] Job Performance: Aligning tasks with individual personality traits boosts productivity and job satisfaction.
[Link] Turnover: Understanding personality helps retain employees by placing them in roles where they can thrive,
increasing engagement and reducing turnover.
[Link] Training and Development: Personality assessment helps design training programs that suit individual learning
preferences and strengths
Dark Traids

•Machiavellianism: Depicts manipulation and

secretive behavior.
•Narcissism: Shows self-absorption and vanity.
•Psychopathy: Highlights cold, reckless decision-
making without empathy.
3.3. Meaning of Perception
Perception refers to the process by which individuals select, organize and interpret
sensory inputs to give meaning to their environment.
World would have been much simpler if everyone had perceived similarly.
The perception process (Input,
Process, and Output )
The process further consists of three sub-components, namely, Selection,
classification & Interpretation.

I. Input:

1. Sensation: (e.g., eyes, ears). Employees receive sensory information from the
environment also known as Reception of Stimuli.

II. Process

1. Perceptual Selection: based on certain factors like immediate goals, personal

interest, past experiences, intensity, contrast, cultural background, values,
expectations, etc. In other words, people select stimuli and pay attention to objects
around them. For Example, An Employee may come across various tasks but might
pay more attention to tasks that are near to the deadline.
The perception process
Organizing/Classification and Interpretation:
It involves how selected perceptions are structured and interpreted. Further employees assign meaning
to organized stimuli, based on individual personal beliefs, attitudes, and emotions.

III. Output Decision Making and Behavior: The perceptions formed influence decision-making
processes and are reflected in the behavior. For example: A recruiter might end up recruiting low-
performing candidates based on their dressing sense if he/she perceives that a knowledgeable
employee will be dressed properly.
Attribution Theory- “How people make judgments
about others”

Attribution theory explains the cognitive process through which individuals attribute
reasons to their behavior. Behavior results from a blend of internal factors (such as
capability or intention or effort) and external factors (like difficulty level of task or
destiny).

For example, an Employee might perceive that a promotion is due to hard work
(internal factor) or he might perceive it due to some luck factor (external factor).
 Harold Kelley suggested that people make internal external
attributions based on three types of information-
1. Consensus: This refers to the extent employees behave
the way others (or peers) behave in a given situation.
Consensus remains high when employees behave

Internal and similarly to peers and low when he/she behaves

differently.
External 2. Consistency: This refers to consistent behaviour.

Attribution Low on this factor represents an individual change in

behavior over time.
Harold Kelley
3. Distinctiveness: This pertains to the extent to which the
person behaves differently across different situations. High
distinctiveness exists when the behavior varies across
different contexts, whereas low distinctiveness indicates
consistency in behavior across various situations.
Internal and External Attribution
Harold Kelley
Errors and Biases in Attributions

1. Fundamental Error of Attribution: This error refers to the tendency of employees

to attribute others' failure or negative behaviour to internal factors, and their success
to external factors.
2. Self-serving bias error: It refers to the tendency of employees to attribute their
success to internal factor and their failures to external factors.
 Frequently Used Shortcuts in Judging Others
1. Projection Bias: Projection bias refers to the tendency of employees to attribute their own characteristics (beliefs, attitudes, and behaviors) to
others.
2. Halo Effect: Example: Mr X has a charismatic personality. During team meetings, he is able to communicate well. Due to the halo effect, his seniors may
perceive that he is a top performer who is good at work, and possesses problem-solving skills, etc.
3. Horn Effect: For Example- Conversely, if Mr X initially makes a negative impression, perhaps by being shy or reserved, colleagues might assume he
lacks confidence or isn’t capable of leading initiatives. This negative impression could overshadow his actual strengths in other areas such as analytical
thinking or project management.
4. Stereotyping Bias: Stereotyping bias is a tendency to judge people based on one’s perception of the group (such as race, gender, age, etc.) to which
that person belongs.
5. Confirmation Bias: Example: A manager believes that graduate toppers scoring first 10 ranks are more sincere and determined at work as
compared to others. During a recruitment process, he tends to unconsciously focus on candidates' backgrounds that support this belief and downplay
other critical factors like relevant experience, ultimately missing out on potentially suitable candidates.
6. Contrast Effect Bias: Example: During interviews managers often compare candidates coming on the same day. If the manager interviews three
candidates with low profiles, the manager tends to feel more impressed with a fourth candidate with a slightly better profile (even though the fourth
candidate might not be a good fit for the given position). In such scenarios managers, perception of the fourth candidate might be overly positive due
to the contrast effect. He/She might overlook potential weaknesses or areas of improvement in the fourth candidate.
7. Recency Effect: Example: During performance appraisal, more weight is given to recent contributions as compared to past contributions or
contributions made by an employee throughout the year. Similarly, a supervisor evaluates an employee's performance based solely on their recent
mistakes, overlooking their consistent track record over the past year. This bias can lead to unfair performance assessments and missed opportunities
for recognizing long-term contributions.
 Importance of Perception in organisation

✓ Decision Making: For example, if a manager perceives subordinates avoid work and are
lazy, he will be more engaged in setting norms and rules.
✓ Conflict Resolution: Managers could resolve the conflict if they eliminate the perceptual
biases that often distort how people perceive their surroundings.
✓ Leading: To a leader, it's crucial to create a positive perception in the minds of followers.
✓ Engagement: Perceptions also influence how employees perceive the given tasks, job
roles, and overall environment of the organization.
✓ Organizational Culture: Shared perceptions among employees about organizational
values, norms, and goals contribute to a cohesive culture.
 Rational Decision Making and
Bounded Rationality
Rational Decision-making assumes that managers make decisions based on all the
available information. A rational manager is expected to explore all the alternatives,
look into the pros and cons of each alternative, and then make a decision.

Bounded Rationality- Unlike the Rational decision-making model, Bounded rationality

(proposed by Herbert Simon), recognizes that decision-makers often operate under
constraints that limit their ability to gather and process all the information. These
constraints include time, cognitive limitations of the decision-maker, and other
complexities in the decision-making environment.
UNIT III

üEgo states
üTransactional analysis
üLife positions
üStrokes
üGame analysis
üJohari window
üNeed of understanding transactional analysis
 EGO STATES
➢According to Dr Eric Berne, Each Ego state
consists of some common behavioural pattern an
individual follows in various situations. Usually,
their present-day reactions are based on their past
experiences and feelings.
PARENT EGO ADULT EGO CHILD EGO

Teaching Rationality Spontaneous

Demonstrating Objective Impulsive

Rules & Laws Figuring out Fantasizing

Dos and Don’ts Estimating Creativity

Truths Evaluating Experiencing

joy/frustration
DEPENDING ON THE EGO STATES OF THE
PERSONS INVOLVED IN TRANSACTIONS,
THERE MAY BE FOUR TYPES OF
TRANSACTIONS:

✓Complementary,
✓Non-Complementary,
✓Ulterior
✓Gallows.
I. ADULT-TO-ADULT
TRANSACTIONS
➢Most satisfactory transaction and
leads to healthy communication.
➢The individuals involved are
rational, logical, and objective.
➢It is the best type of
communication, as it is respectful
and reduces conflicts.
II. ADULT-TO-PARENT
TRANSACTION
➢If the other individual responds
from the nurturing parent's ego
state, the communication will be
smooth.
➢On the other hand, if the response
comes from a critical parent ego
state, it could give rise to a conflict.
III. ADULT-TO-CHILD
TRANSACTION
• Such a transaction is
generally not seen on work
premises.
IV. PARENT-TO-PARENT
TRANSACTION
➢In this transaction, the manager
uses rewards, criticism, and rules.
➢The transaction can be beneficial
if the employee supports him.
➢Otherwise, the two may be
needless competition as the
employees will try to push their
ideas.
V. PARENT-TO-ADULT
TRANSACTION
➢The stimulus uses dogmatic
and overbearing language but
gets countered with a logical
reply.
➢Therefore, conflicts over
trivial matters are staved off.
VI. CHILD-TO-CHILD
TRANSACTIONS
➢Such a type of transaction is not
suitable for a workplace.
➢Both individuals act on whims,
fancies, and emotions in this
transaction.
➢Therefore, the organization
suffers badly, and the situation
cannot last long.
 VII. CHILD-TO-PARENT
TRANSACTION
• :Employee: To whom should I
submit the file after completing
it? (C-P)
• Manager: You must always
follow the chain of command
for any official work. (P-C)
VIII. PARENT-TO-CHILD
TRANSACTION
• This can be satisfying for both in
the short run. Conflict and
pressure are eliminated.
• But in the long run, the
personality of the employee may
remain underdeveloped, which
may create a feeling of
frustration.
NON-COMPLEMENTARY
TRANSACTION

•A Non-complementary or
cross-transaction occurs when
the person who initiates the
transaction does not get the
response from the expected ego
state.
 ULTERIOR
TRANSACTIONS
• We all have been in a conversation where it is all about
the 'unsaid’.
• The real message is hiding behind the veil of social
interaction.
• There is an overt and a covert message in such
conversations.
• In ulterior transactions, two messages are conveyed
simultaneously — a social message on top and a
psychological one at the bottom.
LIFE POSITIONS-BY THOMAS HARRIS
 STROKE ANALYSIS
We are born needing and seeking contact, with an innate sense that we can’t survive without it.
Throughout our lives, we receive this contact through various types of verbal and nonverbal
communication:
✓ a smile
✓a hug
✓praise for something we do or who we are
✓a challenge to something we do or who we are.
Eric Berne described strokes as a unit of recognition, one person acknowledging another by
way of act or speech.
 TYPES OF STROKES:

positive and negative Verbal and nonverbal Conditional and

unconditional.
 JOHARI WINDOW
➢Johari window is a framework developed
by two psychologists, Joseph Luft and
Harrington Ingham.
➢ Itis a widely used model to understand
and train self-awareness and biases for
personal development and to improve
communications, group dynamics, team
development, interpersonal relationships,
and intergroup relationships.
 JOHARI WINDOW- OPEN AREA
Open Area (Anything about yourself that you're willing to share with others): An “Open Area” is desirable as a
team because when we work in this area with others, we are at our most effective and productive.

Blind Area: (Anything about oneself that you are unaware of but that others have become aware of)

Unknown Area: Any region that neither you nor anyone else is familiar with is the unknown area. The
information in this quadrant is mysterious and has unknown potential.

Hidden Area: (Anything about yourself that you are reluctant to reveal to others is in the hidden area):
 JOHARI WINDOW
➢There are two interpersonal processes of ‘DISCLOSURE’ AND ‘FEEDBACK’,
which cause the redistribution of awareness and changes in the size and form of the
four quadrants.
➢ The model assumes that an ‘open self’ becomes larger, and the relationship
tends to be more rewarding and productive.
 CONTENT PROCESS THEORY X AND
THEORIES THEORIES THEORY Y

Unit IV

APPLICATION
PROCESS OF
MOTIVATION
Employees who are "happy"
are sometimes mistaken for
those who are "motivated." It
is a force that directs
employees to act a certain way.
 Theories of Motivation

Cognitive Models Non-Cognitive Models

Content Theories Process Theories Reinforcement Theory

by B.F. Skinner

Maslow's Need Hierarchy Vroom's Expectancy

Theory Theory

Herzberg's Motivation Adam's Equity theory

Hygiene Theory

Alderfer's ERG Theory Goal Setting Theory

By Edwin Locke

McClelland's Needs
Theory

Theory X and Theory Y

MASLOW
Self actualization needs

Esteem Needs

Social Needs

Safety Needs

Physiological Needs
 Frederick Herzberg proposed the two-factor theory of motivation

Hygiene Hygiene factors Motivators

Factors (Job- Motivating
Dissatisfaction) Factors (Job- Absence results in dissatisfaction; Absence results in no satisfaction;
Satisfaction)
presence results in no dissatisfaction presence results in satisfaction

Examples- company policy, Examples- Achievement, recognition,

administration, supervision, working work itself, responsibility, and growth
conditions, equitable salary
ALDERFER’s ERG Theory

Growth
Relatedness
Existence
Herzberg Maslow

The theory given by Herzberg is based on It is not based on an empirical study.

an empirical study.

The theory fails to explain the behaviour It is true for all employees in general.
of workers. It is more relevant for
professionals.

Only higher-order needs are treated as All unsatisfied needs could be a motivator.
motivators.

It is prescriptive in nature. It is Descriptive in nature

It doesn't follow any sequence. It follows a hierarchical arrangement of

needs.
Three need model is formulated by `David McClelland.

Need for Need for achievement ( n Ach) refers to the

Achieveme drive to excel, grow, strive, and succeed to a set
nt
Three of standards.
Need for
Need Power Need for power (n Pow): Here institutionalised
Theory power refers to the power used for social
Need for benefit, and personalised power refers to the
Affiliation
power exercised for individual gain.
Need for affiliation (n Aff): The desire for
friendly and close interpersonal relationships.
PROCESS
THEORIES
VROOM-Expectancy theory
Expectancy (Effort -performance probability) -Expectancy refers to an employee's perception of his
capabilities to perform the given task. It could range from 0 to 1.

Instrumentality : employees' beliefs about doing specific actions will lead to promised rewards (strength of
relationship). It could range from 0 to 1.

Valence– This represents employees' preference for the reward. In other words, it refers to how highly the
employees value the rewards. It could range from -1 to 1. If an employee is indifferent about the reward,
his valence will be zero.
JS Adams Equity Theory
Inputs [What I put into
my job: Efforts, loyalty,
time, knowledge, etc.]

Outputs [What I get

from my job: Pay,
bonus, perks, benefits,
etc.]
 The goal-setting theory emphasizes on the importance
Edwin of setting specific and challenging goals for

Locke and achieving motivated behaviour. Challenging goals

are difficult but not impossible to attain.

Gary Latham Challenging goals lead to higher employee effort

formulated than easy goals. Third, goals affect persistence.

Employees exert more effort to achieve high goals.

the goal- Fourth, goals motivate employees to use their existing

knowledge to attain a goal or to acquire the knowledge
setting needed to do so.

theory The goal-setting model indicates that individuals have

needs and values that influence their desires.
B.F. Skinner formulated
reinforcement theory
TYPES
➢Positive reinforcement SCHEDULES OF REINFORCEMENT
➢Negative ✓Fixed interval
➢PUNISHMENT ✓Fixed Ratio
➢Extinction ✓Variable Interval
✓Variable Ratio
 Redesigning of jobs to motivate employees
✓Job Rotation:

✓Job Enrichment

ALTERNATIVE WORK ARRANGEMENTS

✓Job sharing

✓Telecommuting
APPLICATION ✓Flexi time

EMPLOYEE ENVOLVEMENT PROGRAM

✓Quality circle and participation

Unit V
üLeader v/ manager
üTheories of leadership- Trait, behavioral, and
contemporary
übehavioral, and contemporary
Leadership

Who is a Leader?
Leader v/s Manager
The Three Styles of Leadership

Kurt Lewin gave three basic styles of leadership in 1939.

Autocratic leader (Authoritarian)
Democratic Style
Laissez-faire
Rensis Likert with his colleagues 1960 examined data collected from 200 organisations, in order to
figure out which leadership style could extract maximum productivity from the subordinates.

System 1 - Exploitative Authoritative

System 2 - Benevolent Authoritative

System 3 – Consultative

System 4 - Participative

LIKERT’S MANAGEMENT SYSTEMS

Early Leadership Theories BEHAVIOURAL APPROACH CONTINGENCY THEORIES CONTEMPORARY
THEORIES
Great man theory Ohio State Studies Fiedler Contingency Model Transactional leadership
theory
Trait theory University of Michigan Hersey and Blanchard’s Transformational
Situational Theory Leadership theory

Managerial Grid Charismatic Leadership

theory

Authentic Leadership

THEORIES OF Each theory is an attempt to explain the phenomena.

Whereas leadership style is a way in which a leader leads
LEADERSHIP an organisation.
 BEHAVIOURAL APPROACH
Individual could learn certain behaviours and can become a successful leader. Research in
leadership from the late 1940s to the mid-1960s mainly focused on finding behavioural
High
Low structure
styles that manager demonstrates and are most preferred in an organisation. structure and
and High
High
consideration
consideration

Consideration
III. Ohio State Studies
Thousands of dimensions were studied. They were reduced to the following two dimensions
which cover most of the leader's behavior –
High
The four quadrants as reflected in the above figure show the following- Low structure
structure and
and low
low
[Link] structure and low consideration: He demonstrates a laissez-faire style of leadership. consideration
consideration
[Link] structure and low consideration: Autocratic leader.
[Link] structure and high consideration: Leader focus more on employees welfare
Initiating Structure
[Link] structure and high consideration: Democratic leader where he/she does build a
structure but remains open to altering it and adding ideas of followers to it.
Figure 4: Ohio State Studies

(Source: Author)
 IV. University of Michigan:
Similar to Ohio state studies, a study was conducted at the University of
Michigan to identify the behaviour of leaders that enhances both
performance and employee satisfaction. The following two behavioural
dimensions were identified and were placed in single continuum-
[Link]-oriented leader- The leader focuses on the task aspect of
the given job.
[Link]-oriented leader- Under this a leader is more concerned
BEHAVIOURAL about the feelings and welfare of the employees. He/she tends to invest
more in the interpersonal relationship as compared to the task aspect of
APPROACH the job.

It was found that production-oriented leaders are able to increase

production, but simultaneously it led to high turnover and
dissatisfaction among employees.
 BEHAVIOURAL APPROACH
V. Managerial Grid: (Robert Blake and Jane Mouton developed
the managerial grid in 1960).
The model consists of two axis each ranging from 1 to 9. The x-axis
consists of concern for production and the y-axis includes concern for
people.

✓The impoverished style (1, 1) Country club (1-9) Team (9-9)

✓The country club style (1, 9)
✓ The task management style (9, 1) Middle Road
✓The middle-of-the-road style (5, 5) (5-5)

✓The team style (9, 9)

Impoverished (1-1) Task (9-1)
CONTINGENCY THEORIES VI Fiedler Contingency
Model: In 1967, Fred
Fiedler suggested that
there is a need to have a
match between the style
of leadership and the
situation at hand.

✓Change the situation

and make it fit to the
Figure 6: Fiedler Contingency Model
given leadership style.
Source: Robbins, S. P., Judge, T., & Breward, K. (2016). Essentials of organizational behaviour. Pearson
Canada. ✓Change the leader and
Table 2 Eight possible situations as suggested by Fiedler
have someone whose
natural leadership style
Situation Favourable Moderate Situation Unfavourable
fit the given situation.
Situation Situation
Leader- Good Good Good Good Poor Poor Poor Poor
member
relations
Task High High Low Low High High Low Low
structure
Position Strong Weak Strong Weak Strong Weak Strong Weak
Power
 Figure 6: Fiedler Contingency Model

Source: Robbins, S. P., Judge, T., & Breward, K. (2016). Essentials of organizational behaviour. Pearson
Canada.

Table 2 Eight possible situations as suggested by Fiedler

Situation Favourable Moderate Situation Unfavourable

Situation Situation
Leader- Good Good Good Good Poor Poor Poor Poor
member
relations
Task High High Low Low High High Low Low
structure
Position Strong Weak Strong Weak Strong Weak Strong Weak
Power

Fiedler suggested that task-oriented leaders perform better in extreme situations, whereas relationship-oriented leaders perform
better in moderate situations
.
CONTINGENCY THEORIES
VII. Hersey and Blanchard’s Situational Theory:

Participating
Selling Style
style
Relationship Behavior

Delegating
Telling style
style

Task Behavior

Followers Readiness
High Moderate Moderate Low
R4 R3 R2 R1
Able and willing Able but unwilling Unable but Unable and
Willing Unwilling
Figure-7 Hersey and Blanchard’s Situational Theory
 CONTEMPORARY THEORIES
VIII. Transactionaland Transformational Leadership Style:
Burns and Bass introduced the idea of transactional and
transformational leadership style. Under transactional
Leadership, employees are appreciated for their
contribution. But employees who lacks skills are usually
neglected by the manager. Transactional leaders are
more concerned about completing goals.

Unlike transactional leaders transformational leaders

provides a vision to the followers. Transformational
Leaders change followers' perceptions and help them
solve old problems in new ways.

Bass suggested four factors that form transformational

Leadership, namely, idealized influence, inspirational
motivation, intellectual stimulation, and individual
consideration
 CONTEMPORARY THEORIES
➢Charismatic leaders: Use charisma, persuasion, and empathy to motivate others to take risks and perform at their
best. They are often seen as having strong communication skills, emotional intelligence, and self-confidence.

➢Authentic Leadership emphasizes transparency, ethical behavior, and genuine relationships between leaders and
followers. Authentic leaders are self-aware, genuine, and guided by strong values, fostering trust and engagement.
The four key components of Authentic Leadership are:

1. Self-Awareness
2. Balanced Processing
3. Relational Transparency
4. Internalized Moral Perspective
Unit VI

üGroup
üGroup v/s team
üTypes of groups and teams
üStages of group development
üReasons for joining groups
üGroup Cohesiveness,
üGroup Think and Group Shift
Work Groups

Group is defined as “interaction and interdependence of two or more individuals,

who have come together to achieve some purpose”.
 Reasons for Joining group
[Link]: Groups give security to people. Employees often feel o perceive threat in an organisation. This includes fear of
being alone, fear of getting fired, etc.

[Link]/Goal achievement- Certain goals can’t be achieved working alone. People work in group to achieve such
goals/objectives.

[Link]-People in group gets power. They are able to influence others in a better way as compared to when they stand alone.
Group power lies in being united as a group.

[Link] Needs: As discussed in previous lesson employees do have social need (For more clarity refer to Maslow’s and
Alderfer’s theory of motivation mentioned in motivation lesson). Being in groups fulfil people’s social needs.

[Link] Self Interest: At times people join group to fulfil their own economic interest like unions are formed.

6. Physical Proximity. Sometimes groups are formed simply because physically people are close to each other. Mutually
they find certain common goals, interest or sometimes they find it better than being alone. For example, imagine your
teacher is 20 minutes late to class. Provided all the students in classroom are unknown to each other. What will happen after
15 minutes? Probably small groups will be seen. People sitting in same row will tend to form group rather than first bencher
with back bencher.
 Stages in Group Development
Bruce Tuckman proposed the model of group development. The initial model included only four stages. Later, a fifth stage was added to the model. Following sections
includes various stages of group formation and development as defined by Tuckman-

[Link] 1- Forming- Forming is a first stage. The idea remains to understand each other and form some ground rules. This is
termed as Forming. Here forming indicates the initial interaction that aims to work in groups.
2. Stage 2-Storming- Second stage is known as storming. Initially you try to influence other group members. Usually each member
will try to lay down group norms and roles or will try to influence them. You will agree that this will lead to tension, or conflict. You
will be able to see a power struggle, where most of the members are trying to lead. Through open discussion group goals will be
clarified. This stage is termed as storming.
3. Stage 3-Norming. Eventually, all group members will start accepting each other. you will accept others' viewpoints or others will
accept your viewpoints. and group norms will emerge. At this stage group norms will emerge and group members will realize their
true purpose and objective to be together.
4. Stage 4- Performing. With clarity in purpose and norms of the group, Allocation of tasks to group members will start.
5. Stage 5- Adjourning- Initially only above four stages were added to the model. With time it was realized that even after
completion of work, groups do exist and usually there is one more stage, i.e., Adjourning. This stage represents the separation of
groups. Some members may feel happy over the performance, and some may be unhappy over the stoppage of meeting with group
members.
Group Cohesiveness

Members of highly cohesive group are highly motivated to be together. In other

words, cohesiveness is the "extent to which individual members of a group are
motivated to remain in the group".
 Causes of Group Cohesiveness

1. Homogeneity: If members come from same background or share similar characteristics then cohesiveness of group
remains high.
2. Group maturity: If groups are of permanent nature, then simple they develop closeness as time passes.
3. Group size- Due to complex interpersonal interaction patterns, large size group are usually less connected as compared
to small size group.
4. Frequency of interaction: If group interacts regularly or Frequency of interaction is high then group cohesiveness is
high.
5. purpose and goal are clear- if purpose and goals of group are clear, then group members develops greater Cohen. This
reduces distracting and unnecessary conflicts among group members.
5. External threat- group members remain together if they sense threat from external environment. Take example of labor
unions, group remains together as they find sense of security in huge number.
6. Success- if group while working together gets success in previous projects. The cohesiveness among group members
increases.
 Consequences Of Group Cohesiveness

1. Existence of group in true sense- if group cohesiveness is low, then members won't be willing to remain
together. This also means that they would miss group meetings and will keep group goals and tasks as their last
priority.

2. Power: If group remains strongly connected they are in better position to influence others.
3. Problem of group think: highly cohesive group suffers from a problem of group think. This is discusses in
detail in next section
4. Group shift: Highly cohesive groups also suffer from problem of group shift. refer to next section for more
details on group shift.
5. Highly cohesive group exhibits more participation and loyalty. They are well integrated with each other
while working.
6. High satisfaction: group members are more satisfied and happy in a cohesive group.
Group Think Group Shift
In this group member feels pressure and In this individual group member
conform to the decisions made by other psychologically changes their position.
group members. They tend to take more risk and pick
extreme positions.

Here, the decision is against the belief Here, there is change in position.
and opinion of the individual member. Individual risk-taking aptitude changes
Individual opinions are put aside and when decisions are made by the group.
members tend to conform popular It is also known as risky shift.
opinion.
What causes Groupthink?
Following are some of the tentative causes of group think at work-
1. Group Cohesiveness- Strong group cohesiveness often results into group
think. Members confirm decision which are against their own opinions and
beliefs.
[Link] of Diversity- Diversity in group adds different opinions and creativity.
Group coming from same backgrounds often results into group think at work.
[Link] constrains: When decisions are to be made in a limited time, then
majority of the members agree to the popular opinion in the group taken by a
few influencing members.
4. Stressful Decision making: When there are tough choices and decisions
are stressful, then group think occurs.
 “A small group of people with complementary skills who are committed
to a common purpose, performance goals, and approach for which they
hold themselves mutually accountable” . Commitment in case of team is
high. Interdependency on each other is high. Accountability remains mutual.

Work Team
Problem Solving Teams

Self-Managed Work Teams

Cross-Functional Teams

Virtual Teams
Unit VII

üDecision making
üSteps in decision-making
üIndividual decision making
üGroup decision making
üTypes of decisions
The Decision-Making Process
Programmed Decision - a simple, routine matter for which a manager has an
established decision rule
Nonprogrammed Decision - a new, complex decision that requires a creative solution
Step 1: Define Problem- Goals/ Objectives
Step 2-Explore-generate ideas- Gather information
Step 3-Generate Alternative Ideas
Step 4- analyze alternatives- pros and cons
Step 5 choose an alternative
Step 6-Take action
Step 7- Review
 Rationality - a logical,
step-by-step approach
Rational Model to decision making, with a
thorough analysis of
alternatives and their
consequences

1. The outcome will be completely rational

2. The decision maker uses a consistent system
of preferences to choose the best alternative
3. The decision maker is aware of all alternatives
4. The decision maker can calculate the
probability of success for each alternative
 Bounded Rationality - a
Bounded Rationality theory that suggests that
there are limits upon how
Model rational a decision maker
can actually be

1. Managers suggest the first satisfactory alternative

2. Managers recognize that their conception of the world is simple
3. Managers are comforable making decisions without determining all the
alternatives
4. Managers make decisions by rules of thumb or heuristics
 Garbage Can Model
Solutions

Problems Choice
Garbage Can Model - opportunities
Participants
a theory that contends
that decisions in
organizations are
random and unsystematic

From M.D. Cohen, J.G. March, and J.P. Olsen in Administrative Science Quarterly 17 (March 1972) 1.25.
Reprinted by permission of the Administrative Science Quarterly
Intuitive Decision-Making Model

Intuitive Decision-Making Model

•This model relies on instincts, experiences, and gut feelings
rather than structured analysis. It works best in situations
requiring quick decisions or when experience aids judgment.
Managers Can Ask These Questions When
Evaluating Objectives
Criteria Questions to Ask
Relevance Do the objectives relate to and support the basic purpose of
the organization?

Practicality Do the objectives recognize obvious constraints?

Challenge Do the objectives provide a challenge for managers at all

levels in the organization?

Measurability Can managers quantify the objectives?

Schedulability Can managers monitor the objectives at interim points to

ensure progress?

Balance Do the objectives provide a proper balance on all activities,

given organizational goals?
 (cont.)
Criteria Questions to Ask
Flexibility Are the objectives sufficiently flexible or is the organization
likely to find itself locked into a particular course of action?

Timeliness Given the organization’s environment , is this the proper time

to adopt these objectives?

Technology Do the objectives fall within the boundaries of current

technological development?

Growth Do the objectives help the organization grow, not just

survive?

Cost Do the objectives’ expected costs clearly outweigh their

effectiveness benefit?

Accountability Can managers assess the performance of those responsible

for attaining the objectives?
 Gathering Ideas

•Brainstorming
•The Nominal Group Technique
•The Delphi Method
 Brainstorming

•Topic
•Take turns sharing ideas
•Record each idea
•No comments/criticisms
•One idea per turn
•Members may pass
•Keep going until ideas are exhausted
 Mangers Should Follow This Advice for
Successful Brainstorming
•List all ideas.

•Do not Evaluate any ideas during the initial stages.

•Encourage creativity.

•Offer ideas related to those already listed.

•Ask each participant to offer a specific number

(e.g. five to ten) of new ideas.

•Set a time for brainstorming.

 Affinity Diagram
Definition: A group decision-making technique designed to sort a large number of ideas, concepts,
and opinions into naturally related groups. These groups are connected by a simple concept.

Purpose: To sort a list of ideas into groups.

Guidelines:

Insure ideas are described with phrases or sentences.

Minimize the discussion while sorting --
Aim for 5-10 groups.
If one group is much larger than others, consider splitting it.
 The Nominal Group Technique
A generic name for face-to-face group techniques in which instructions are given to group
members not to interact with each other except at specific steps in the process.

•Silent idea generations,

•Round-Robin Sharing
•Feedback to the group,
•Explanatory group discussion,
•Individual re-assessment.
 Delphi Technique
•Problem stated
•Questionnaires
•Anonymous & Independent
•Compile results
•Distribute copies of results
•New round begins
•Does not require physical presence
•Time consuming
Group Decision-Making
Advantages 1) pressure in
groups to conform
1) more knowledge 2) domination by
through pooling of one forceful member
group resources or dominant clique
2) increased 3) amount of time
acceptance & required, because
commitment due group is slower
to voice in decisions than individual
3) greater under- to make a
standing due to decision
involvement in
decision stages

Disadvantages
 üStress
üSources of stress
üConsequences of stress
Unit VIII üWellbeing
üPerma model
üStrategies to manage stress
What is Stress?
Work stress is referred to as a reaction to some potentially
threatening aspects of the environment. These reactions are
felt at both physical and emotional levels.
 ✓It explains patterns in which the human body physically reacts to stressful
events.

General ✓ There are 3 stages.

Adaptation ✓The first stage is when the body gives initial signs. Wherein the Endocrine
gland releases the hormones. At this stage heartbeat and respiration increase,
Syndrome the digestion process goes down, muscles tense up.

(GAS) ✓Following the initial shock, the body moves to Stage 2, where it attempts to
recover and return to equilibrium. This is also known as the stage of
resistance.

✓Either stress-related symptoms disappear or the body moves to Stage 3 where

it starts showing more stress-related problems like headaches, ulcers, and high
blood pressure. If employees reach Stage 3, then the situation becomes
threatening to both the employee and the organization.
 I. Organisational Sources

1. Nature of jobs

2. Change from the routine pattern

3. The physical design of the organization

4. Role Demands: The role is defined as a set of expectations/ or expected

behavior associated with any job in the organization. Role demands
Causes/ include two sub-categories, namely role ambiguity and role conflict.

Sources of Role overload: This is commonly also termed work overload. This is a
situation under which employees feel they are overloaded with work
Stress at Work either in terms of quantity or quality.

Even underutilization leads to stress. Other reasons for stress at work

include poor leadership, pressure from formal and informal groups,
conflicting interpersonal relationships, job instability, and other
factors due to which employee finds situation more demanding and less
rewarding.
 1. Personal control:

2. Personality Type: Studies suggest that people who have Type

B personalities remain calm during stressful events and employees
with Type A personalities are comparatively more prone to stress.

3. Expectations- If expectations are high either from self or

Individual organisation, it could lead to more stress.

Sources 4. Stable and turbulent life: If there is stability in personal life

then employees tend to feel less stress.

.5. Career Goals- If individual goals are different from

organizational goals. Then conflicting goals will lead to stress.

6. Health issue- Post covid – 19, stress levels among the

employees have increased due to the health issue. Here the health
issues include both physical and mental health of the employees.
 Physiological changes:

⮚ It could enhance the breathing rate.

⮚ It could lead to high blood pressure.

⮚ Headaches.

⮚ It may lead to heart-related issues like heart attacks, coronary

Consequences heart disease, and others.
of Stress ⮚ It could weaken Immune System.

⮚ It could lead to burnout, which could lead to a high rate of leaves due
to sickness.

⮚ It could trigger stomach and other problems like- IBS-irritable bowel

syndrome, ulcers, acid reflux, and others.
 Psychological changes

⮚ Procrastination.

Consequences ⮚ High level of anxiety, tension, etc.

of Stress ⮚ Lack of engagement in the job.

⮚ Show signs of boredom with work-related activity.
⮚ It also triggers the overall mental well-being of
employees.
 Behavioral Changes

⮚ Absenteeism: Stress could increase absenteeism due

to a lack of interest and above mentioned
physiological and health issues.

Consequences ⮚ Reduce Productivity: Stress could reduce

productivity and enhance the turnover rate.
of Stress
⮚ Changes in individual lifestyle: It is seen that under
stress people start smoking and alcohol consumption.
It also disturbs the sleep patterns due to stress.
 ➢ Individual level

✓ Time Management
Stress ✓ Exercise
Management
✓ Techniques to relax your mind

✓ Social Network
 1. Selection and placement of employees

Stress 2. Goal Setting

Management: 3. Employee participation and involvement

Organizational 4. Job design

Level 5. Some initiatives: Some initiatives like employee sabbaticals, well-being
subsidies, etc., could reduce stress and enhance the well-being of employees.

6. Well-being programs
 ✓ Feelings follow a complex pattern and are
associated with an object.

✓ Positive emotion includes happiness, feeling

Emotions of joy, affection, etc., and Negative emotions
include anger, disgust, sadness, etc.
Emotional intelligence
The term Emotional Intelligence was
initially mentioned by Peter Salavoy and
John Mayer in 1990. Later, the concept
was popularized by Daniel Goleman.

Emotional intelligence refers to an

individual’s tendency where he/she is
able to manage and understand his/her
own emotions and is also able to
understand the emotions and feelings of
others.
1. Self-Awareness: It includes everything that falls under emotional self-awareness- i.e. your feelings, moods,
emotions, and effect of your emotions on your actions. Self-awareness helps in making the right decision in
situations that involve pressure and uncertainty.

2. Self-Management: Self-management includes managing your emotions during setbacks and stressful events.

3. Social Awareness: It refers to understanding the emotions of others in the organization. Empathy remains at the
core of social awareness.

4. Relationship Management: Last is relationship management. It is an ability to manage conflict, mentor, and
coach others. It helps in improving teamwork spirit and influencing others.
Wellbeing at work
Wellbeing can be defined in various ways and can be of various types like spiritual well-being, social well-being, etc. Here we will focus on
Seligman’s PERMA model where well-being theory is based on self-actualization (as defined by Abraham Maslow).

1. P-Positive Emotion

2. E-Engagement.

3. R- Positive Relationship

4. M-Meaning

5. A-Accomplishments
 üStructure vs design

Unit IX üTypes of structures like functional, matrix, divisional etc

üOrganic vs mechanic organisation
 What is an Organisational
Structure?
Organizational structure refers to the formal system of task allocation, coordination, and supervision within an organization.

Key Components of Organizational Structure:

[Link]: Establishes levels of authority and chain of command.

1. Example: CEO → Managers → Team Leads → Employees.

[Link] of Labor: Specifies how tasks are divided among individuals or departments.

[Link] of Control: Defines the number of employees managed by a single supervisor.

[Link]: Mechanisms for integrating the efforts of individuals and departments.

[Link]: The extent to which rules, procedures, and responsibilities are documented and standardized.
The importance of the
Organizational Structure

•Ensures clarity in roles and

responsibilities.
•Facilitates effective communication and
decision-making.
•Promotes efficiency and productivity.
•Aligns resources and efforts with
organizational goals.
•Adapts to the size and complexity of the
organization.
 •Organizational Structure is the outcome or framework,
while Organizational Design is the process of creating
or adjusting that framework.
•Design focuses on aligning the structure with strategy and
Organisation environmental demands, whereas structure is about
implementing and maintaining that alignment.
structure v/s In essence, organizational design creates or evolves the
Design organizational structure to ensure the business remains
effective, adaptable, and aligned with its strategic
objectives.
Span of Control: The number of people that a can a manager efficiently and
effectively direct.
Centralization and Decentralization: Where is the decision making authority?
Formalization: To what degree will there be rules and regulations to direct
employees and managers?
Mechanistic versus Organic Organization

• High specialization • Cross-functional teams

• Rigid departmentalization • Cross-hierarchical teams
• Clear chain of command • Free flow of information
• Narrow spans of control • Wide spans of control
• Centralization • Decentralization
• High formalization • Low formalization
CHALLENGES IN TODAY’S DYNAMIC ENVIRONMENT
1. Globalization and Cultural Diversity
2. Technological Disruption
3. Remote Work and Virtual Teams
4. Need for Agility and Flexibility
5. Employee Expectations and Workforce Dynamics
6. Managing Complexity and Innovation
Departmentalization by Type
➢Functional ➢Process
◦ Grouping jobs by functions ◦ Grouping jobs on the basis
performed of product or customer flow
➢Product ➢Customer
◦ Grouping jobs by product line
◦ Grouping jobs by type of
➢Geographical customer and needs
◦ Grouping jobs on the basis of
territory or geography
 TYPES OF STRUCTURES
I. The line structure is the simplest and oldest form of organizational
structure. In this structure, authority flows directly from top to bottom in a
straight line. Every employee reports to one superior, and decisions are
made by a single chain of command.

II. Line and Staff Structure:

The line and staff structure combines the line organization, where
there is a clear chain of command, with staff positions that provide
specialized expertise and support to line managers. It is a common
structure in medium to large organizations.
 Functional structure – A functional structure is an organizational setup
III
where employees are grouped based on their specialized functions or roles,
such as marketing, finance, operations, and HR.

Advantages of Functional Structure

1. Specialization
TYPES OF 2. Clear Chain of Command
STRUCTURES 3. Operational Efficiency

Disadvantages of Functional Structure

1. Lack of Coordination

2. Limited Focus on Organizational Goals

3. Conflicts Between Departments

 TYPES OF STRUCTURES
IV Divisional Structure
Advantages:
A divisional structure organizes a company into [Link] to respond quickly to market changes.
semi-autonomous divisions based on products, [Link] accountability for divisional performance.
markets, or geographic regions. Each division has its [Link] decision-making for quicker responses.
own resources and functions, allowing focus on specific [Link] innovation within divisions.
areas.

Suitability: Disadvantages:
•Ideal for large, diverse organizations or [Link] duplication across divisions.
multinational companies (e.g., Coca-Cola, [Link] of coordination between divisions.
General Electric) with multiple product lines or [Link] operational costs due to separate functions.
markets. [Link] competition for resources.
 TYPES OF STRUCTURES
V. Matrix Structure
Advantages:
A matrix structure is a hybrid organizational design [Link] communication across departments.
where employees report to two or more managers— [Link] flexibility and responsiveness to changes.
typically a functional manager and a project or [Link] collaboration between different functions.
product manager. This structure aims to improve [Link] use of resources across projects and functions.
flexibility and communication across the organization. [Link] innovation by integrating diverse perspectives.

Suitability:
Disadvantages:
•Best for large organizations with complex [Link] and conflict due to dual reporting lines.
projects or products that require flexibility and [Link] struggles between managers.
[Link] stress from managing multiple priorities.
cross-functional collaboration.
 Contemporary Organizational Designs

Team Structure

• What it is: A structure in which the entire organization is made up of work groups or
teams.

• Advantages: Employees are more involved and empowered. Reduced barriers among
functional areas.

• Disadvantages: No clear chain of command. Pressure on teams to perform.

 TYPES OF STRUCTURES

Boundaryless Structure

A boundaryless organization removes traditional organizational boundaries between departments,

employees, and even between the company and external partners. It emphasizes collaboration,
flexibility, and the removal of hierarchical barriers to improve innovation and responsiveness.
 Yes, virtual and network organizations can be considered forms of boundaryless organizations. Both types focus on
breaking down traditional organizational boundaries to enhance flexibility, collaboration, and responsiveness.