Chapter 1 What is Organizational

Behavior?

McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.

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Learning Goals

What is the definition of “organizational behavior”?

What are the two primary outcomes in studies of organizational behavior? What factors affect those two primary outcomes?

Do firms that are good at organizational behavior tend to be more profitable? Why might that be, and is there any research evidence to support this tendency?

What is theory, and what is its role in the scientific method?

What does a “correlation” represent, and what are “big”, “moderate”, and “small” correlations? What is a meta-analysis?

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Discussion Questions

Think of the worst coworker you've ever

had. What did that person do that was so

bad?

Think of the best coworker you've ever

had. What did that person do that was so

good?

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The Best of Coworkers, the Worst

of Coworkers Ta

ble

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Basic Elements of Organizational

Behavior

Organizational behavior (OB)

Human resource management

Strategic management

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OB Foundations

Theories and concepts in OB are drawn

from a wide variety of disciplines

Industrial and organizational psychology

Social psychology

Sociology

Economics

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Integrative Model of Organizational

Behavior

Individual Outcomes

Individual Mechanisms

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Individual Characteristics

Group Mechanisms

Organizational Mechanisms

Integrative Model of Organizational

Behavior, cont’d

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Integrative Model of OB

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Does Organizational Behavior Matter?

Resource-based view

Financial resources (revenue, equity)

Physical resources (buildings, machines)

Knowledge, decision-making, culture

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Discussion Question

Is it really the people that make some

companies more profitable than

others?

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Rare

Resources, people

Inimitable

History

Numerous small decisions

Socially complex resources

What Makes a Resource Valuable?

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What Makes a Resource Valuable?

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Research Evidence

OB practices were associated with better firm performance

Firms who valued OB had a 19% higher survival rate than firms who did not value OB

Good people comprise a valuable resource for companies

There is no “magic bullet” OB practice – one thing that, in-and-of itself, can increase profitability Rule of one-eighth

OB on Screen Office Space

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How Do We Know

Method of Experience

Method of Intuition

Method of Authority

Method of Science

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Scientific Studies

Theory

Hypotheses

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The Scientific Method F

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Correlation (r)

Describes the statistical relationship between

two variables

Can be positive or negative and range from 0

(no statistical relationship) to ± 1 (a perfect

statistical relationship)

Scientific Studies, cont’d

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Different Correlation Sizes F

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Different Correlation Sizes F

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Different Correlation Sizes F

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Social Recognition & Job Performance

How often does social recognition lead to higher job performance? Burger King study

Correlation between social recognition and job performance was .28

Correlation between social recognition and retention

rates was .20

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Notable Correlations Ta

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Meta-analysis

The best way to test a theory is to conduct many

studies, each of which is as different as possible

from the ones that preceded it.

Meta-analysis

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Takeaways

Organizational behavior is a field of study devoted to understanding and explaining the attitudes and behaviors of individuals and groups in organizations. It focuses on why individuals and groups in organizations act the way they do.

The two primary outcomes - job performance and organizational commitment. A number of factors affect performance and

commitment, including individual mechanisms, individual characteristics, group mechanisms, and organizational mechanisms.

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Takeaways, Cont’d

The effective management of organizational behavior can help a company become more profitable because good people are a valuable resource. Rare

Hard to imitate

History that cannot be bought or copied,

Make numerous small decisions that cannot be observed by competitors

Create socially complex resources such as culture, teamwork, trust, and reputation.

Good OB policies have been linked to employee productivity, firm profitability, and even firm survival.

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Takeaways, Cont’d

A theory is a collection of assertions, both verbal

and symbolic, that specifies how and why

variables are related, as well as the conditions in

which they should (and should not) be related.

A correlation is a statistic that expresses the

strength of a relationship between two variables

(ranging from 0 to 1).

A meta-analysis summarizes the results of several

research studies. It takes the correlations from those

research studies and calculates a weighted average to

give more weight to studies with larger samples.