TOPIC 1. INTRODUCTION TO ORGANISATIONS

TOPIC 1. INTRODUCTION TO ORGANISATIONS WHAT IS AN ORGANISATION? ORGANISATION: a deliberate arrangement of people to accomplish some specific purpose DISTINCT PURPOSE: goals the organisation wishes to accomplish COMPRISED OF PEOPLE: it takes people to perform the work that is necessary for the organisation to achieve its goals DELIBERATE STRUCTURE: to clarify work relationships TRADITIONAL ORGANISATION STABLE INFLEXIBLE JOB FOCUSED WORK IS DEFINED BY JOB POSITIONS INDIVIDUAL ORIENTED PERMANENT JOBS COMMAND ORIENTED MANAGERS ALWAYS MAKE DECISIONS RULE ORIENTED RELATIVELY HOMOGENEOUS WORKPLACE (SAME/OLD FASHIONED) WORKDAYS DEFINED AS 9 TO 5 HIERARCHICAL RELATIONSHIP WORK AT ORGANISATIONAL FACILITY DURING SPECIFIC HOURS NEW CONTEMPORARY ORGANISATION DYNAMIC FLEXIBLE SKILL FOCUSED WORK IS DEFINED IN TERMS OF TASKS TO BE DONE TEAM ORIENTED TEMPORARY JOBS INVOLVEMENT ORIENTED EMPLOYEES PARTICIPATE IN DECISION MAKING CUSTOMER ORIENTED DIVERSE WORKFORCE WORKDAYS HAVE NO TIME BOUNDARIES LATERAL AND NETWORKED RELATIONSHIPS WORK ANYWHERE, ANYTIME, INCLUDING AT SUPPLIERS AND CUSTOMERS WHO ARE MANAGERS? MANAGER: someone who coordinates and oversees the work of other people so that organisational goals can be accomplished Not about personal achievement; it is about helping others to do their work and achieve collective goals Could involve coordinating the work activities of a team composed of people from several different departments or even people from outside the organisation FIRST LINE MANAGERS: are the lowest levels of management and manage the work if nonmanagerial employees who are directly involved with producing the organisation s products or servicing the organisation s customers IE: Supervisors, shift managers, office managers, team leaders, forepersons MIDDLE MANAGERS: include all levels of management between the first-line level and the top level of the organisation NICOLE LIU MGMT1001 1

Manage the work of first-line managers IE: regional manager, department head, project leader, store manager, dean or division manager TOP MANAGERS: responsible for making organisation-wide decisions and establishing the goals and plans that affect the entire organisation IE: managing director, CEO, Chief Operating Officer, Chairman of the Board Involved in creating and implementing broad and comprehensive changes that affect the entire organisation WHAT IS MANAGEMENT? MANAGEMENT: involves coordinating and overseeing the work activities of others so that their activities are completed efficiently and effectively EFFICIENCY: getting the most output from the least amount of inputs Deal with scarce input (resources such as people, money and equipment) therefore concerned with the efficient use of these resources Concerned with the means of getting things done EFFECTIVENESS: completing activities so that organisational goals are attained Doing the right things Through various work initiatives, goals are pursued AND achieved The attainment of organisational goals INTERRELATIONSHIP BETWEEN EFFECTIVENEES AND EFFICIENCY It is easier to be effective is one ignores efficiency EG: produce high quality cars over a long time period, with resources costing exponentially more By doing wrong things well, organisations can be efficient but ineffective MANAGEMENT FUNCTIONS PLANNING ORGANISING LEADING CONTROLLING Defining goals Determining Motivating Monitoring Establishing what needs to Leading activities to strategy be done Any other ensure that Developing plans to How it will be done actions involved in they are accomplishe coordinate Who is to do it dealing with d as planned activities people Taking corrective actions PLANNING: They define goals, establish strategies for achieving those goals, and develop plans to integrate and coordinate activities Management must clearly define their purpose and the means for its achievement ORGANISING: Management are responsible for arranging and structuring work to accomplish the organisation s goals They determine what tasks are to be done, who is to do them, how the tasks are to be grouped, who reports to whom and at what level decisions are to be made 2

LEADING: Every organisation includes people, and management must work with and through people to accomplish organisational goals Motivate subordinates, help to resolve work group conflicts, influence individuals or teams as they work, select the most effective communication channels, or deal in any way with the employee behaviour issues CONTROLLING: Ensures goals are being met and that work is being completed as planned monitor and evaluate performance. After the goals are set and the plan formulated (planning), the structural arrangements determined (organizing) and the people hired, trained and motivated (leading), there has to be some evaluation of whether things are going as planned. Actual performance must be compared with previously set goals If there are any significant deviations, it is management s job to get work performance back on track Monitoring, comparing and correcting Looking for more efficient and effective ways to achieve goals POLC LEADS TO MANAGERS ACHIEVING ORGANISATION S STATED PURPOSES MANAGEMENT ROLES MANAGEMENT ROLES: refers to specific categories of managerial behaviour We are not looking at a specific person, but at the expectations and responsibilities that are associated with being the person in that role the role of a manger INTERPERSONAL ROLE All managers are required to perform duties that involve people and other duties that are ceremonial and symbolic in nature FIGUREHEAD: Symbolic head; obliged to perform a number of routine duties of a legal/social nature EG: Greeting visitors; signing legal documents LEADER: Responsible for the motivation of subordinates; responsible for staffing, training and associated duties Performing virtually all activities that involve subordinates LIASION: Maintains self-developed network of outside contacts and informers who provide favours and information Acknowledging mail: doing external board work; performing other activities that involve outsiders INFORMATIONAL ROLE Receiving, collecting and disseminating information MONITOR Seeks and receives wide variety of internal and external information to develop thorough understanding of organisation and environment Seeks and receives wide variety of internal and external information to develop thorough understanding of organisation and environment DISSEMINATOR Transmits information to outsiders on organisation s plans, policies, actions, results, etc. EG: Transmits information to outsiders on organisation s plans, policies, actions, results, etc. SPOKESPERSON Transmits information to outsiders on organisation s plans, policies, actions, results, etc. NICOLE LIU MGMT1001 3

EG: Holding board meetings; giving information to the media DECISIONAL ROLES Revolve around making choices ENTREPRENEUR Searches organisation and its environment for opportunities and initiates improvement projects EG: Searches organisation and its environment for opportunities and initiates improvement projects DISTURBANCE HANDLER Responsible for corrective action when organisation faces important, unexpected disturbances EG: Organising strategy and review sessions that involve disturbances and crises RESOURCE ALLOCATOR Responsible for the allocation of organisational resources of all kinds making or approving all significant organisational decisions EG: Scheduling; requesting authorization; performing any activity that involves budgeting an the programming of subordinates work NEGOTIATOR Responsible for representing the organisation at major negotiations EG: Participating in union contract negotiations HIGH LEVELS OF MANAGEMENT: the roles of disseminator, figurehead, negotiator, liaison and spokesperson are more important LOW LEVELS OF MANAGEMENT the leader role becomes increasingly more important MANAGEMENT SKILLS TECHNICAL SKILLS TECHNICAL SKILLS: job specific knowledge and techniques needed to perform specific tasks proficiently First line managers and many middle managers are heavily involved in technical aspects of the organisation s operations typically managing the employees who are using tools and techniques to produce the organisation s products or service the organisation s customers As a result, employees with excellent technical skills often get promoted to the first-line manager role Even top managers need some proficiency in the organisation s specialty HUMAN SKILLS HUMAN/INTERPERSONAL SKILLS: represent the ability to work well with and understand others, to build cooperative effort within a team (lead), to motivate and to manage conflict Important for managers at all levels Managers need to be aware of their own attitudes, assumptions and beliefs, as well as being sensitive to their subordinates perceptions, needs and motivations Managers deal directly with people Managers with good interpersonal skills are able to get the best out of people They know how to communicate, motivate, lead, and inspire enthusiasm and trust CONCEPTUAL SKILLS CONCEPTUAL SKILLS: the ability to think about and to conceptualize about abstract and complex situations HELICOPTER PERSPECTIVE: see the organisation as a whole, and understand the relationships between various subunits, and to visualize how the organisation fits into its broader environment essential to effective decision making 4

Becomes more important in top management positions IMPORTANT MANAGERIAL SKILLS Managing human capital Effective communication Inspiring commitment Managing change Structuring work and getting things done Facilitating the psychological and social contexts of work Using purposeful networking Collaboration and team building Critical thinking and problem solving Managing decision-making processes Managing strategy, creativity and innovation Managing logistics and technology MANAGERS AND CHANGE CHANGE IS CONSTANT: Managers everywhere are dealing with global economic and political uncertainties, environmental concerns in relation to global warming and climate change, security threats, corporate ethics scandals, and technological advancements CHANGES IMPACT OF CHANGES CHANGING TECHNOLOGY Shifting organisational boundaries (DIGITISATION) Virtual workplaces More mobile workforce Flexible work arrangements Empowered employees INCREASED THREATS TO Risk management SECURITY Work life-personal life balance Restructured workplace Discrimination concerns Globalisation concerns Employee assistance INCREASED EMPHASIS ON Redefined values ORGANISATIONAL AND Rebuilding trust MANAGERIAL ETHICS Increased accountability Corporate governance INCREASED COMPETITIVENESS Customer service Innovation Globalisation Efficiency/productivity INCREASED ENVIRONMENTAL Management for sustainability CONCERNS Carbon-neutral operations Recycling Reduced consumption of energy and other resources NICOLE LIU MGMT1001 5

TOPIC 2. UNDERSTANDING INDIVIDUAL BEHAVIOUR WHY LOOK AT INDIVIDUAL BEHAVIOUR IN ORGANISATIONS? ORGANISATIONAL BEHAVIOUR: a field of study concerned with the actions (behaviours) at work When we look at organisations, we look at the visible aspects: strategies, goals, policies and procedures, structure, technology, formal authority relationships and chain of command But under the surface are other elements that managers need to understand elements that influence how employees work Hidden aspects include attitudes, perceptions, group norms, informal interactions, interpersonal and intergroup conflicts FOCUS OF ORGANISATIONAL BEHAVIOUR INDIVIDUAL BEHAVIOUR- includes topics such as attitudes, personality, perception, learning and motivation GROUP BEHAVIOUR- norms, roles, team building, leadership and conflict The behaviour of a group of employees cannot be understood by merely summing up the actions of the individuals in the group, because individuals in a group setting behave differently from individuals acting alone IMPORTANT EMPLOYEE BEHAVIOURS EMPLOYEE PRODUCTIVITY EMPLOYEE PRODUCTIVITY: is a performance measure of both efficiency and effectiveness Managers want to know what factors will influence the efficiency and effectiveness of employees ABSENTEEISM ABSENTEEISM: failure to report to work. Many studies of unscheduled absence have been undertaken and some of these have found that for organisations with high absence levels, up to half of the unscheduled absences from the workplace may be avoiable. In Australia, the average number of days absent is 8.5 days per employee per annum Some very recent studies suggest that unscheduled absences can cost Australian companies around $3700 per employee per year. Excessive levels will have a direct and immediate impact on the organisation s functioning TURNOVER TURNOVER: the voluntary and involuntary permanent withdrawal from an organisation. Problems increased recruiting, selection, training costs and work disruptions It is suggested that the turnover replacement cost for a company would be somewhere between 50% and 150% of an individual s annual salary. Turnover is something managers want to minimize, especially among high-performing employees and those difficult to replace 6

ORGANISATIONAL CITIZENSHIP BEHAVIOUR (OCB) OCB: discretionary behaviour that is not part of an employee s formal job requirements, but which promotes the effective functioning of the organisation EG: helping others on one s work team, volunteering for extended job activities, avoiding unnecessary conflicts, and making constructive statements about one s work group and the organisation Organisations need individuals who will do more than their usually job duties Organisations that have such employees outperform those that do not However, the drawbacks are that employees may experience work overload, stress and work-family conflicts JOB SATISFACTION JOB SATISFACTION: refers to an employee s general attitude towards his or her job Satisfied employees are more likely to show up for work and to stay with an organisation WORKPLACE MISBEHAVIOUR WORKPLACE MISBEHAVIOUR: is any intentional employee behaviour that has negative consequences for the organisation or individuals within the organisation Shows up in 4 ways Deviance, aggression, antisocial behaviour and violence ATTITUDES ATTITUDES: are evaluative statements either favourable or unfavourable concerning objects, people or events - They reflect how an individual feels about something Attitude is made up of three components: cognition, affect and behaviour COGNITIVE COMPONENT: refers to the beliefs, opinions, knowledge and information held by a person. EG: discrimination is wrong AFFECTIVE COMPONENT: is its emotional or feeling part. (Usually, attitude refers to the affective component) EG: I don t like Matt because he discriminates BEHAVIOURAL OUTCOMES: refers to an intention to behave in a certain way towards someone or something. EG: I might choose to avoid Matt because of my feelings about him. THEREFORE: Cognitive Affect Behaviour JOB SATISFACTION Job satisfaction tends to increase as income increases Job autonomy, regular meetings between management and staff that induced them to interact and cooperate, as well as the existence of semi-autonomous work groups are important factors that were positively associated with job satisfaction Jobs with high levels of work pressures and time constraints often find that their employees have lower satisfaction levels as they are dissatisfied with their work-life balance, and long work hours JOB SATISFACTION AND PRODUCTIVITY There is a strong correlation between satisfaction and productivity it is generalized that if employees were satisfied with their jobs, then productivity would increase. NICOLE LIU MGMT1001 7

JOB SATISFACTION AND ABSENTEEISM Satisfied employees have lower levels of absenteeism than do dissatisfied employees however, the correlation is not strong JOB SATISFACTION AND TURNOVER Satisfied employees have lower levels of turnover Research also suggests that an important moderator of the satisfaction-turnover relationship is the employee s level of performance o For superior performers the level of satisfaction is less important in predicting turnover as the organisation typically does everything it can to keep high performers pay raises, praise, recognition, increased promotion opportunities etc. JOB SATISFACTION AND CUSTOMER SATISFACTION For frontline employees who have regular contact with customers, job satisfaction lead to positive customer outcomes o Satisfied employees increase customer satisfaction and loyalty o Satisfied employees are more likely to be friendly, upbeat and responsive, which customers appreciate o Because satisfied customers are less likely to leave their jobs, customers are more likely to encounter familiar faces and receive experienced service JOB SATISFACTION AND ORGANISATIONAL CITIZENSHIP BEHAVIOUR Satisfied employees would seem more likely to talk positively about the organisation, help others and go above and beyond normal job expectations Research suggests that there is a modest overall relationship between job satisfaction and OCB but the relationship is tempered by perceptions of fairness If you do not feel as though your supervisor, organisational procedures or pay policies are fair, your job satisfaction is likely to suffer significantly However, when you perceive that these things are fair, you have more trust in your employer and are willing to engage voluntarily in behaviours that go beyond your formal job requirements JOB SATISFACTION AND WORKPLACE MISBEHAVIOUR When employees are dissatisfied with their jobs, they will respond somehow If managers want to control the undesirable consequences of job dissatisfaction, they would be better of attacking the problem job dissatisfaction- than trying to control the different employee responses JOB INVOLVEMENT AND ORGANISATIONAL COMMITMENT JOB INVOLVEMENT: The degree to which an employee identifies with his or her job, actively participates in it, and considers his or her job performance to be important to his or her self-worth HIGH JOB INVOLVEMENT: Strongly identify with and really care about the kind of work they do Positive attitudes contribute in positive ways to their work Fewer absences Lower resignation rates Higher employee engagement with their work ORGANISATIONAL COMMITMENT: the degree to which an employee identifies with a particular organisation and its goals, and wishes to maintain membership in the organisation HIGH ORGANISATIONAL COMMITMENT Lower levels of absenteeism and turnover PERCEIVED ORGANISATIONAL SUPPORT: employees general belief that their organisation values their contribution and cares about their well-being High levels of perceived organisational support lead to increased job satisfaction and lower turnover 8

EMPLOYEE ENGAGEMENT EMPLOYEE ENGAGEMENT: employees being connected to, satisfied and enthused about their jobs HIGH EMPLOYEE ENGAGEMENT More likely to be top performers Higher retention rates help keep recruiting and training costs low As a result, the higher performance and lower costs contribute to superior financial performance LOW EMPLOYEE ENGAGEMENT Disengaged employees do not care they show up for work but have no passion or energy for it. ATTITUDES AND CONSISTENCY Studies have concluded that people seek consistency among their attitudes and between their attitudes and behaviour People change what they say so that it does not contradict what they do Individuals try to reconcile differing attitudes and align their attitudes and behaviour so their appear rational and consistent When there is an inconsistency, they will take steps to make it consistent either by altering their attitudes or behaviour, or by developing a rationalisation for the inconsistency COGNITIVE DISSONANCE THEORY COGNITIVE DISSONANCE: any incompatibility or inconsistency between attitudes or between behaviour and attitudes By understanding cognitive dissonance theory, it can help predict how likely individuals are to change their attitudes and behaviours The theory argues that any form of inconsistency is uncomfortable and that individuals will try to reduce the dissonance and, thus, the discomfort individuals seek stability with a minimum of dissonance The theory proposes that the desire to reduce dissonance is determined by three things 1. THE IMPORTANCE OF THE FACTORS CREATING THE DISSONANCE If the factors creating the dissonance are relatively unimportant, the pressure to correct the imbalance will be low However, if those factors are important, individuals may change their behaviour, conclude that the dissonant behaviour is not so important, change their attitude, or identify compatible factors that outweigh the dissonant ones 2. THE DEGREE OF INFLUENCE THE INDIVIDUAL BELIEVES HE OR SHE HAS OVER THOSE FACTORS The degree of influence that individuals believe they have over the factors will also affect their reaction to the dissonance If they perceive the dissonance to be uncontrollable something about which they have no choice- they are unlikely to be receptive to attitude change. 3. THE REWARDS THAT MAY BE INVOLVED IN DISSONANCE Rewards also influence the degree to which individuals are motivated to reduce dissonance. Coupling high dissonance with high rewards tends to reduce the discomfort inherent in the dissonance, by motivating the individual to believe their there is consistency IMPLICATIONS FOR MANAGERS Managers should be interested in employees attitudes give warnings of potential problems and influence behaviour Providing flexible work options, monetary incentives and management support programs such as leadership training and internal career opportunities may be options managers want to contemplate to keep talented employees engaged in order to retain their services NICOLE LIU MGMT1001 9