Chapter 4_ the Changing Environment of Organization

7/21/2019 Chapter 4_ the Changing Environment of Organization

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HUMAN BEHAVIORIN ORGANIZATION

THE CHANGING ENVIRONMENT

OF ORGANIZATION


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GLOBALIZATION AND

BUSINESS

Globalization the internationalization

of business activities and the shift

toward an integrated global economy.


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THE GROWTH OF

INTERNATIONAL BUSINESSDomestic

Business

InternationalBusiness

Improved Communication andTransportation Facilities

Larger Potential Market

Lower Costs of Production and

DistributionResponse to te International

!ctivit" of Competitors


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CROSS CULTURAL

DIFFERENCES AND

SIMILARITIESGeneral Observationbehavior in organization settings

vary across culturesculture itself is one major cause of

variation

organizations and the way they arestructured appear to be growing

increasingly similar


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Specific Cultural Issues

Geert Hofstede Dutchresearcher

60 countries

specific attitudes and behaviorsdiffered significantly

values and beliefs that

characterized those countries.


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Dimensions of Culture

Individualism exists to the extend that

people in a culture define themselvesprimarily as individuals rather than as

part of one or more groups or

organizations.

Collectivism characterized by tight

social frameworks in which people tendto base their identities on the group or

organization to which they belong.


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Power Distance (orientation to authority)

the extend to which people accept asnormal an unequal distribution of power

Uncertainty Avoidance (Preference forStability) the extent to which people

feel threatened by unknown situations

and prefer to be in clear andunambiguous situation


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Masculinity (Assertiveness or

Materialism) the extent to which thedominant values in a society

emphasize aggressiveness and the

acquisition of money and otherpossessions as opposed to concern for

people, relationships among people

and overall quality of life.


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Long - Term Values include

focusing on the future, working onprojects that have a distant payoff,persistence and thrift.

Short Term Values moreoriented toward the past and thepresent and include respect for

traditions and social obligations.


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MANAGERIAL BEHAVIOR

ACROSS CULTURES

Individual variations in people from

different cultures shape the

behavior of both managers and

employees.

Differences are more likely to

influence managerial behavior.

Differences relate to managerial

beliefs about the role of authority

and power in the organization.


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Indonesia, Italy and Japan the purpose

of an organizations structure is to let

everyone know who his or her boss isUS, Germany and Great Britain

organizational structure is intended to

coordinate group behavior and effortItalian and German Managers it is

acceptable to bypass ones boss

Swedish and British Managers bypassing ones superior is strongly

prohibited


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Japan Managers a manager should be

able to answer any question he or she is

askedSwedish Manager least concern about

knowing all the answers.

Managers are becoming more career

oriented, better educated, more willing

to work cooperatively with labor, morewilling to delegate and more

cosmopolitan.


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DIVERSITY AND BUSINESS

Workforce Diversity refers to theimportant similarities and differences

among the employees of organizations.

Workforce diversity is valuing uniqueness,

while respecting differences, maximizing

individual potentials and synergizing

collective talents and experiences for thegrowth and success of the business 3M


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Stereotype a generalization about

a person or group of persons basedon certain characteristics or traits.

Prejudices judgment about othersthat reinforces beliefs about

superiority and inferiority.


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DIMENSIONS OF DIVERSITY

Primary Dimension those factorsthat either inborn or exert ordinary

influence on early socialization

AgeRace

Ethnicity

GenderPhysical and Mental Abilities

Sexual Orientation


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Secondary Dimensions include factors that

matter to us as individuals and that to some

extent define us to others, they may be less

permanent than primary dimensions and can beadapted or changed

Educational Background

Geographical LocationIncome

Marital Status

Military Experience

Parental Issues

Religious Beliefs

Work Experience


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THE VALUE OF DIVERSITY

The US has historically been seen as s

melting pot of people from many

different countries, cultures and

backgrounds.

Today, the workplace in US might be

regarded as more of tossed salad made

up of different flavors.

Diversity training is a common methodused in businesses today to better enable

employees to accept and value

differences.


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Assimilation the process through which

members of a minority group are forced to

learn the ways of the majority group.

Valuing Diversity putting an end to the

assumption that everyone who is not a

member of dominant group must assimilate.

Valuing diversity is not the right thing to do for

workers; it is the right thing to do for the

organization, both financially and

economically


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TECHNOLOGY AND BUSINESS

Technology refers to the methods used tocreate products, including both physical

goods and intangible services.

Three Specific Areas of TechnologyRelevant to OB:

1.The shift toward a service-based economy

2.The growing use of technology frocompetitive advantage

3.Mushrooming change in information

technology


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MANUFACTURING AND

SERVICE TECHNOLOGIES

Manufacturing a form of business that

combines and transforms resources into

tangible outcomes that are then sold to

others.

Service Organization one that

transforms resources into an intangible

output and creates time or place utility

for its customer.


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Managers have come to see that many

tools, techniques and methods that areused in a factory are also useful to a

service firm.

Service based firms must hire and train

employees based on different skill

required by most manufacturers.


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TECHNOLOGY AND

COMPETITION

Technology is the basis of competition forsome firms, especially those whose goals

include being the technology leaders in

their industries.

The speedier the process allows companies to

more quickly respond to changing economic

conditions, consumer preferences, and new

competitor products while recouping morequickly their product-development costs.


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INFORMATION TECHNOLOGY

Breakthrough in informationtechnology have resulted in:

leaner organizations

more flexible operations increased collaboration among

employees

more flexible work sites improved management processes

and systems


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Information technology also resulted in:

less personal communication

less down time for managers and

employees

an increase sense of urgency vis a vis decision making and communication

changes that have not necessarily

always been beneficial.


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ETHICS AND CORPORATE

GOVERNANCE

CONTEMPORARY ETHICAL ISSUES

Ethics a persons beliefs regarding what

is right or wrong in a given situation.

The public (as well as current and

potential investor) often get blurred

pictures on a firms competitive health


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Stakeholders employees, stakeholders,consumers, unions, creditors, government

all entitled to fair accounting so they can

make enlightened personal and business

decisions.


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Other Contemporary ethical Issues

executive compensationenvironmental protection

working conditions in foreign

factoriespricing policies

pressure to balance profits against

cost as businesses continue to

globalize


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ENRON

From the 1990's until the fall of 2001, Enronwas famous throughout the business world

and was known as an innovator, technology

powerhouse, and a corporation with no fear.

The sudden fall of Enron in the end of 2001

shattered not just the business world but

also the lives of their employees and the

people who believed that their soar togreatness was genuine. Their collapse was

followed by a series of revelations on how

they manipulated their success.


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ENRONS COLLAPSE

Mark-to-market Accounting- The company's

aggressive accounting had corruptedEnron's books and had allowed the company

to be far too optimistic in it's assumptions

about the future profits.The Enron Culture- bonuses and incentives

in form of cash or stock options came in

bundles, only if you were good enough and ifyou were considered one of the

moneymakers.


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Special Purpose Entity -disclosed in

Enron's financial statements depressingearnings and debt levels severely

Key players -Enron was housed by bright

and talented employees and everyonethinks they are so smart or smarter than

the others that they think they could

always get away with 'crime'.


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AFTERMATH OF ENRONS

BANKRUPTCY

Sarbanes-Oxley Act is a US federal law

that came after the Enron scandal.

The act contains a set of standards that

regulate public company boards,

management and public accounting

firms.


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Some of the main regulations is that allcompanies must have a majority of

independent directors, nominating

and compensation committee has to

have independent directors also theaudit committee should consist of

members that are financially

educated and one of the membershave to been an expert (Wikipedia,

2012)


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ETHICAL ISSUES IN

CORPORATE GOVERNANCE

Corporate Governance refers to the

oversight of a public corporation by its

board of directors

The board of public corporation is

expected to ensure that the business is

being properly manage and that the

decisions made by its seniormanagement are in the best interests of

shareholders and other stakeholders.


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While board members need to have some

familiarity with both the firm and its

industry in order to function effectively,

they also need sufficiently independenceas might be necessary to carry out their

oversight function.


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ETHICAL ISSUES IN

INFORMATION TECHNOLOGY

# Individual rights to privacy

# Potential abuse of information

technology by companies

# Plagiarism


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NEW EMPLOYMENT

RELATIONSHIPS

THE MANAGEMENT OF

KNOWLEDGE WORKERS

Knowledge workers those employeeswho add value in organization simply

because of what they know.

Knowledge workers include computer

scientist, physical scientist, engineers,

product designers and video game

developers.


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Knowledge workers tend to work in

high technology firms and are

usually experts in some abstract

knowledge


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OUTSOURCING

Outsourcing the practice of hiring other

firms to work previously performed by

the organization itself.

Outsourcing helps firms focus on their

core activities and avoid gettingsidetracked onto secondary activities.

Outsourcing grows controversial when

jobs being outsourced are really beingexported to foreign countries in ways

that reduce domestic job opportunities.


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TEMPORARY AND

CONTINGENCY WORKERS

Contingent Worker a person who works

for an organization on something other

than a permanent full-time basis.

Categories of Contingent Workers

independent contractors

on - call workers

temporary employees

contract and leased employees

part-time workers


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An organization with a large contingent

workforce must make some decisions

about the treatment of contingent

workers relative to the treatment ofpermanent, full time workers.


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TIERED WORKFORCE

Tiered Workforce exists when one

group of an organizations workforce

has a contractual arrangement with the

organization objectively different fromanother group performing the same

jobs.

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Chapter 4_ the Changing Environment of Organization