6 Field of OB: Individual, Groups and Systems as building blocks

Dr. Harpreet Singh Chahal

1. Learning Outcome

2. Introduction

3. Organisational environment and OB

4. Individuals in the organisations

5. Group behaviour

6. Organisational systems and resources

7. Summary

1. Learning Outcome:

After completing this module the students will be able to: Describe the building blocks of OB
Discuss about the influence of environment on organisation
List various individual factors influencing organisational performance Discuss the role of groups in organisational performance
Discuss about the organisations as a system.

2. Introduction

Before starting discussion on this topic, let us first recall the definition of OB:

“Organisational behaviour means the study of the behaviour of individuals and groups in organisations and organisations themselves as they act and interact to attain desired outcomes”.

This definition explains well that OB is the study of human behaviour in organisations. The field of OB focuses on individual behaviour, group behaviour and organisations as a whole system. The study of individual behaviour calls for an understanding of how actions of employees influence and are influenced by the organisations. Further, organisations also cannot be studied in vacuum. The complete study of organisations is possible only when we learn about the people working there, structures and design and the interface between people and the structures. Besides that, the influence of the environment on the individuals, groups, organisations and the interface between them cannot be overlooked. In order to develop a thorough understanding of OB, one has to move from the first level of understanding individuals and individual behaviour in the organisations to second level of analysing the group behaviour in the context of organisations and finally to the third stage of understanding, analysing and predicting the role of organisational structures and systems in influencing human behaviour in the organisations. These three levels of analysing human behaviour are considered as building blocks of OB. These days, OB has emerged as a distinct field of study, which is based on knowledge about individuals, groups and effects of systems on their behaviour. In this module, we will discuss about building blocks of OB: Individuals, groups, systems and the environment.

3. Organisational environment and OB

Environment surrounding the business has significant impact on the organisations and people working there. Environment includes many factors such as economic factors, technology, cultural factors, political factors and alike. These all factors are external to the organisations have considerable influence on the individual behaviour and organisations as a whole.

Source:Wikimedia

3.1 Economic factors: Economic environment of the business is an important factor influencing human behaviour and organisational systems. Every task we perform in the organisations is performed within the economic framework because it interferes with the organisations directly or indirectly. Economic environment is the combination of several factors such as employment opportunities, wage rates, economic outlook and many more.

Employment opportunities affect individual behaviour as well as organisations to a great extent. If employment opportunities are less in the market, people will seek jobs which offer job security and organisation systems will have to be structured to attract, retain and motivate employees accordingly. On the other hand, if employment opportunities are more, tendency of job hopping will increase.

Wages is the prime source for satisfying individual needs. They provide food, shelter and also serve as a status symbol. It is a popular fact that good wages attract good people in the organisations. They determine satisfaction level of the employees. Similarly, inequality on wages may have harmful effects on the motivation level of employees.

Economic outlook also has significant implications on the employees which are working in the industries driven by the economic cycles. In the times of recession, corporate reorganisations happen in such organisations due to layoffs and retrenchments and many more other reasons. Whereas, when economy favours such organisations also offer attractive benefits and incentives to their employees.

3.2 Technological environment: Technological environment also affects the job opportunities as well as job design. Increased automation, computerisation, robotics and many more technology based production technologies have changed lower level jobs completely. In addition to that, the way the jobs are designed has also been changed. Traditionally the skills which were required to perform a particular job may or may not be required today completely or partially. In the organisations, the reporting structures, role profiles, style of leadership, working environment and reward systems are bound to be changed with the advent of new technologies.

3.3 Cultural environment: Cultural environment is the combination of all of the forces that affect society’s value system, norms, customs, perception, work ethics, attitudes and behaviour. Employees working in the organisations come from various cultures. The cultures from which they come shape their basic values, beliefs and behaviour. Culture varies from country to country. Some important cultural factors influencing individual’s behaviour at work are discussed as below:

Work ethics are related to one’s moral instincts. They reflect an employee’s commitment to his or her work. Strong work ethics assure hardworking and motivated employees whereas weak ethics may not be able to guide an employee regarding do’s and dont’s at work.

Achievement need also influence an employee’s behaviour very strongly. A person with high need to achievement always experience a sense of responsibility, set achievable goals and seek feedback regarding his performance. Achievement is actually a learned phenomenon. Various cultural attributes affect the need for achievement directly or indirectly. People with high need for achievement will be better performers than those with low need for achievement.

Values are the internalised criterion or standards of evaluation which guide an individual about desirable or undesirable, good or bad. Value system influences individual’s perception, attitude and behaviour throughout his or her life.

3.4 Political environment: Political environment constitutes the factors like stability of the government and political ideology and alike. Such factors affect individual’s behaviour in many ways. Stability of the government affects the employment opportunities. In an unstable political environment, companies find it very difficult to attract and retain employees. Moreover, political ideology of the country also affects individual behaviour. Politically ideology determines the amount of freedom provided to the citizens of the country. In a relatively controlled society, opportunities to get good education and employment opportunities available for the people are very less. The amount of freedom provided to the society or the extent to which controls are exercised on the society determine the career choice, job design, motivation methods and above all performance of individuals.

4. Individuals in the organisation:

Organisations are composed of individuals. Performance and behaviour of individuals influence the performance of the organisation. Behaviour of each individual is influenced by various factors such as motives, aspirations, perceptions, abilities and many more. Study of these factors is very useful to understand the concept of OB better. Important attributes influencing individual behaviour in the organisational context are discussed as below:

Source:Maliwan’s Blog

4.1 Age: Age is considered as an important factor because of its significant influence on the performance related behaviours of employees such as productivity, absenteeism, satisfaction and turnover etc. relationship of productivity and age is quiet direct. Productivity is more likely to decline with age. Similarly absenteeism tends to rise with higher age probably because unavoidable reasons of absenteeism like health issues and other household responsibilities increase with age.

4.2 Gender: Influence of gender on individual behaviour also catches attention from various academicians, researchers and sociologists. Research has proved that there are no significant differences in analytical skills, decision making skills, problem solving skills, motivation level, leadership ability and learning abilities amongst males and females. However, there possibilities that gender influence rate of absenteeism and turnover. Tendency of quitting the job and to abstain from the job is found to be higher in case of females because the structure of society has placed high responsibilities of home and family on females than males.

4.3 Education: education has a vital role to play in individual behaviour. Higher levels of education influence individual’s expectations about positive outcomes of job. These expectations are related to a satisfying job, higher income and a good life. Education, general as well as specialised shapes and tunes the behaviour of an individual.

4.4 Abilities: Ability refers to individual’s capacity to perform the task. Abilities are of two types: intellectual abilities and physical abilities.

Intellectual abilities are required to perform the tasks involving mental activities. Intellectual abilities include number aptitude, verbal comprehension, perceptual speed, inductive reasoning, deductive reasoning, spatial visualization, memory etc. intellectual abilities are assessed with the help of IQ tests.

Physical abilities reflect an individual’s stamina, manual dexterity, dynamic strength, static strength, trunk strength, explosive strength, extent flexibility, dynamic flexibility, body coordination, balance etc.

The capacities of different individuals differ with the difference in the levels of their abilities. It is well known fact that different jobs require different intellectual as well as physical abilities. Performance of an individual is enhanced when the ability-job fit is high. This means that better performance can be achieved when abilities are matched with job’s requirements.

4.5 Creativity: It is another factor that influences individual behaviour. It refers to a novel way of viewing and interpreting the problem. A creative person always finds unique ways of performing the tasks, taking decisions and motivating their subordinates. Creativity is the combination of three attributes: background experiences, personal traits and cognitive abilities. Personal traits such as openness to experience, high levels of energy, autonomy and self efficacy are more likely to lead to creativity. Creativity also depends upon how divergently and convergently an individual thinks. Divergent thinking refers to the perceive the differences in the situations and convergent thinking refers to perceive similarities in the situations.

4.6 Perception: Perception refers to the interpretation of the information which is received from the environment. Perception of an individual is formed when the stimulus received from the environment, organised in a particular manner and interpreted to assign some meaning to it. Perception is a subjective process because every individual perceives the same environment differently on the basis of what information they select, the way they arrange and interpret the same in order to understand the situation.

4.7 Personality: Personality is a psychological factor that influences individual behaviour very strongly. Personality provides consistency to a person’s behaviour; Personality is a comparatively stable set of characteristics which describe sum total of ways in which an individual reacts and interacts with others.

4.8 Learning: Behaviour of every human being is affected by the learning process directly or indirectly. Learning can be defined as relatively permanent change in behaviour of an individual that results from reinforced practice or experience. Every day we learn something new with every new experience and every new event or situation. But, this is traditional concept of learning. In real terms, learning is regarded as modifying one’s behaviour through practice, training and experience.

4.9 Attitude: Attitude can be defined as “beliefs, feelings and action tendencies of an individual or group of individuals towards objects, ideas and people. Quite often persons and objects or ideas become associated in the minds of individuals and as result attitude becomes multidimensional and complex.” Attitude of an individual shapes his/her behaviour to a great extent. Work related attitudes of an individual affect individual’s performance and behaviour at work. For example, absenteeism, performance, turnover and organisational citizenship behaviour are largely determined by individual’s attitude. Attitudes are evaluative statements which are frequently used to describe people, events and objects. Attitude, whether favourable or unfavourable, reflects a person’s feelings towards particular object, event or person. Attitude express persistent tendency of an individual to act or behave in a particular manner towards some object

4.10 Values: Values are relatively stable and long lasting convictions or beliefs about what is good or what is bad. Understanding the influence of values on individual behaviour is very essential to understand organisational behaviour. Values of an individual affect attitudes, perceptions, needs and motives of the individuals at work place. Values are very powerful force influencing human behaviour.

The psychological individual factors like personality, perception, learning, values and attitude discussed above will be discussed in detail in the forthcoming modules.

5. Groups behaviour

An organisation is a system which operates through individuals and with the passage of time, they associate together in the form of small groups. Groups also constitute an important building block of the organisations. Groups are made up by the individuals and it operates through the mutual interactions between the group members. When a group is formed, it develops its own structure, functions, values, norms, processes which are pursued by group members. Group behaviour affects organisational performance in the following ways:

5.1 Type of group: Group can be classified as formal groups and informal groups on the basis of its structure, functions and relationships. Formal groups are deliberately planned, designed and structured with well organised functions and predetermined roles. In formal groups relationship between superiors and subordinates is established on the basis of formal authority. In opposite to this, informal groups are based on common interests and needs. The dynamics of both formal and informal groups affect organisational performance.

5.2 Intergroup conflict: Conflict may arise at group level either between the members of the same group or between two groups. The group level conflicts may arise because of more interdependence between the groups, contradictory goals, insufficient resources and many more. Groups may coordinate or compete with each other. The conflict between the groups may either be functional (constructive) or dysfunctional (destructive).

6. Organisational system and resources

Study of an organisation includes nature of the organisation, formal pattern of activities and relationship between various subparts of the organisation (organisational structure), organisational change and development, HR policies and procedures and organisational culture.

6.1 Organisational structure and design: Organisational structure and design includes the way organisations and different groups working there are designed and set up. It includes reporting relationships, division of task and communication patterns among different positions. Structure of organisation influences the behaviour of individuals and groups working in it and the overall organisational effectiveness as well.

6.2 Facilities and resources: Physical facilities such as lighting, air-conditions, ventilation, space given to each employee, tools and equipments have strong impact on employees’ behaviour.

6.3 Organisational processes: It includes the important behavioural processes that contribute in the organisational performance. These processes are discussed as follows:

Leadership: Leadership is very important in influencing the performance of individuals as well as groups. Leadership is to provide supervision, direction, assistance and advise to the members of the organisation. Therefore, leaders’ behaviour is very vital for enhancing organisational performance and effectiveness.

Communication: The process of communication establishes connectivity between the organisation and its environment and between various subunits of the organisation.

Decision making: It includes both individual as well as group decision making.

Organisational change and development: The change is inevitable for the growth and survival of the organisations. Growth and development of the organisations depends upon how well they sense the changes occurring in the environment and adopt them. Change is required not only for the purpose of growth, but also for maintaining a relative degree of stability in the functioning of the organisation.

Organisational culture: Organisational culture has a very important place in the field of OB. It affects attitudes, working behaviour and performance of the employees directly. Many organisations owe the credits of their success to their culture.

The discussion made above clarifies that organisation as a whole is a system which is made up of interrelated components, subunits or processes. Each subunit has a distinct role in the functioning of the organisations. Totality of the subsystems and the mutual interactions between them makes the whole system as an organisation.

7. Summary

The field of OB focuses on individual behaviour, group behaviour and organisations as a whole system. The study of individual behaviour calls for an understanding of how actions of employees influence and are influenced by the organisations. Further, organisations also cannot be studied in vacuum. The complete study of organisations is possible only when we learn about the people working there, structures and design and the interface between people and the structures. Besides that, the influence of the environment on the individuals, groups, organisations and the interface between them cannot be overlooked. These days, OB has emerged as a distinct field of study, which is based on knowledge about individuals, groups and effects of systems on their behaviour. In this module, we have discussed various building blocks of OB: Individuals, groups, systems and the environment.

Individuals are building blocks of organisations. Performance and behaviour of individuals influence the performance of the organisation. Behaviour of each individual is influenced by various factors such as motives, aspirations, perceptions, abilities and many more. Study of these factors is very useful to understand the concept of OB better. Important attributes influencing individual behaviour in the organisational context are age, gender, education, abilities and creativity. Besides this, psychological factors influencing individual behaviour are perception, personality, learning, attitudes and values.

Another building block of OB is group behaviour. An organisation is a system which operates through individuals and with the passage of time, they associate together in the form of small groups. Groups also constitute an important building block of the organisations. Groups are made up by the individuals and it operates through the mutual interactions between the group members. When a group is formed, it develops its own structure, functions, values, norms, processes which are pursued by group members. Type of groups, group dynamics and intergroup conflicts affects organisational performance significantly. At the another level of OB, we study about the organisation as a system. Study of an organisation includes nature of the organisation, formal pattern of activities and relationship between various subparts of the organisation (organisational structure), organisational change and development, HR policies and procedures and organisational culture.

Learn More:

Stephen Robins (2012). Organizational Behavior. New Delhi-110092: Prentice Hall publications.
Aswathappa, K. (2003). Organisational Behaviour. Himalaya Publishing House.
Nair, S. R. (2010). Organisational Behaviour (text & Cases). Himalaya Publishing House.
Prasad, L. M. (2014). Organizational Behaviour. Sultan Chand & Sons.
Greenberg, J. (2003). Organizational Behavior: The State of the Science. Lawrence Erlbaum Associates.
Miner, J. B. (2002). Organizational Behavior: Foundations, Theories, and Analyses. Oxford University Press.
Pareek, U. (2014), Understanding Organisational Behaviour, Oxford University Press (Revised and Updated by Sushama Khanna)
http://www.bput.ac.in/lecture_notes/ob.pdf
Ivancevich, J.M., Konopaske, R. and Matteson, M. (2012), Organisational Behaviour and Management, Mc Graw Hill.
Moshal, B.S. (2015), Organisational Behaviour, Anne Books.