Organizational Behavior

Organizational behavior refers to a study that involves understanding how individuals interact with each other within organizations. Its purpose is to help executives, managers, and human resources employees develop strategies that can enhance employee motivation and engagement. Moreover, studying how they interact can help improve the workplace culture.

Generally, the focus of this study centers around employees’ productivity. However, it may also focus on different ways to better change, manage, and improve human behavior to obtain the desired results, for example, workplace satisfaction and employee well-being. Note that various factors, like the physical environment, structure, and organizational processes, can influence human behavior within a business.

• Organizational behavior refers to a study concerning businesses that helps people understand the interactions taking place among employees. Comprehending how people work together can help improve employees’ productivity and boost their morale.
• There are various features of organizational behavior. Moreover, the concept is multidisciplinary and involves an optimistic and humanistic approach.
• Some noteworthy benefits of organizational behavior are improved communication, better customer service, minimized employee burnout, and improved teamwork.

Organizational behavior refers to a type of academic study that includes research areas dedicated to enhancing job performance, fostering innovation, encouraging leadership, and improving job satisfaction. Simply put, this kind of study aims to improve workplace effectiveness and efficiency.

Specific concepts covered in this study include decision-making, negotiation, motivation, cognition, influence, and power. In comparison, broader study areas include dynamics of change, relationships between companies and their environments, social systems, social networks’ power, etc. 

The findings of such a study have resulted in the formation of various workplace principles. Such principles encourage more efficient and effective business operations and human resources. Consultants and researchers often study the interaction of humans in a workplace about certain key aspects, which are employee motivation, work performance, leadership, and job satisfaction.

This study can help organizations develop positive cultures. Moreover, it can assist human resource (HR) employees as well as managers in making crucial decisions associated with the business's work culture. For instance, the study may offer recommendations concerning compensation, performance assessments, or restructuring.

Some popular methods of this study include —

• Qualitative Research: This technique involves accumulating non-quantifiable information via observation.
• Quantitative Research: This method involves utilizing statistical or quantitative research to carry out the study of employee interactions occurring within the organization. Note that statistical models can include variances and correlation.
• Computer Simulation: This technique involves using mathematical modeling to comprehend the behavior of any organization's employees.

Some key features of organizational behavior are as follows:

1. Three Analysis Levels: This type of study covers three analysis levels —inter-individual behavior, organizational behavior, and individual behavior. They are complementary to one another.
2. Art And Science: This concept is an art as well as a science. The systematic knowledge concerning this study is a science, whereas the application or implementation of behavioral skills and knowledge is an art. That said, it is not an exact science since accurately predicting the behavior of individuals within an organization cannot be possible.
3. Advantages for Both Businesses And Individuals: The study establishes an atmosphere that benefits both the organization and the individuals belonging to it. In other words, the creation of a reasonable climate takes place, which enables the organization to fulfill its objective and allows employees to get much-required satisfaction.
4. Multidisciplinary: Multiple disciplines, such as sociology, political science, anthropology, sociology, etc., form the basis of such a study. In other words, it draws extensive research from such social sciences.
5. Study Of Human Behavior Within A Dynamic Environment: This concept facilitates various methods to predict, scan, and manage individuals’ deviant behavior. Note that addressing new concepts and issues within a company is necessary for this.
6. Optimistic And Humanistic Approach: This study focuses on human behavior within an organization from a humanistic standpoint. According to it, businesses can utilize employees’ optimal potential for their predictive capability and creativity. For this, the concept incorporates both optimistic and humanistic approaches.

There are multiple models associated with such a study. Let us understand them.

#1 - Supportive Model

This model considers leadership at its root level. Here, the orientation of employees is towards their job performance and participation. It assists employees in improving their overall performance. Moreover, it improves their learning. Usually, public sector organizations follow this model as leadership forms the basis of it.

#2 - Autocratic Model

This type of model relies on strength, formal authority, and power. Majorly, it relies on power. Working employees within an organization need to follow orders, and only the higher-level authorities can make the important decisions. When compared to the upper-level authorities, employees in the lower level have comparatively less control. 

#3 - Collegial Model

It is the supportive model’s extension with partnership as the root level. This model focuses on fostering collaboration within the organization. Here, the manager acts as a team member as well as a mentor. Their responsibility is to promote teamwork and ensure that the team delivers a strong performance. They encourage cooperation on a routine basis and monitor the outcomes.

#4 - Custodial Model

In this case, economic resources are the root level. Here, an equitable structure concerning remuneration provides a boost to the employees’ productivity and enthusiasm. This model’s objectives include offering employees various non-financial and financial perks, for example, job security, bonuses, fair compensation, prizes, stability, and paid time off, which, in turn, improves productivity and motivation.

#5 - System Model

This model discusses the working environment, organizational structure, consistent policies, and structure. It aims to achieve a balance between the goals of the organization and the individual, considering persons have different potentials, abilities, and objectives. Staff members and managers within the company invest their interests in an attempt to fulfill the established goals.

Let us look at a few organizational behavior examples to understand the concept better.

Example #1

Suppose in an advertising agency named ABC Company, several graphic designers used to work beyond their office hours to fulfill client-related requirements and deadlines. After conducting thorough organizational behavior research, the human resources manager of the business, John Smith, found out that productivity and employee morale had dropped because of the additional work hours. Moreover, it led to a stressful work environment characterized by a lack of communication and an increase in negative interactions.

Hence, to resolve this, John introduced flexible work hours. Moreover, he reduced the imposition of high-pressure deadlines. This resulted in positive interactions between employees, improved morale, and better productivity.

Example #2

Suppose Company ABC, an organization that manufactures and sells biscuits, has two teams in its sales department. One team’s leader has a strong leader and has a charming personality. The person is accepting of new techniques and ideas and motivates team members on a regular basis. That said, the other team is led by an individual who has a habit of micromanaging. The person is not accepting of new ideas and has a very rigid style of working.

After conducting extensive organizational behavior research about the two teams, one can find out that factors like leadership style and personality can play a key role concerning performance.

Hence, the top-level managers need to change the team lead of the second team to ensure that the group delivers a significantly better performance.

One can understand the importance of this concept by going through the points below.

• The study facilitates effective teamwork
• It enhances customer service
• This study promotes effective leadership
• It establishes a positive work environment for employees
• The study ensures ethical behavior among the people who are part of the management and staff
• Another key benefit of organizational behavior is that it promotes innovation and creativity.

Other advantages include —

• Reduced employee burnout
• Minimized employee attrition
• Increase in trust between management and employees
• Improved communication within the organization

Organizational and organizational development can be confusing concepts for one new to the world of finance. That said, clearly understanding their definition and purpose can be easy if one knows the key differences below.

This article has been a guide to what is Organizational Behavior. We explain its models, importance, characteristics, & comparison with organizational importance. You may also find some useful articles here –

• Organizational Values
• Organizational Design
• Organizational Development