Organizational Behavior Theoretical Notes

8/17/2019 Organizational Behavior Theoretical Notes

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Organizational Behavior – Theoretical Notes

Vítor Pereira Winter 2014

Organizational Behavior Definition

Organizational behavior is the study of individuals and groups within an organizational context,and the study of internal processes and practices as they will influence the effectiveness ofindividuals, teams and organizations.

How did we arrived until today?

Historical Overview

Classical Approaches on How to Manage work and individuals within the organization

1) Frederick Taylor – The scientific Management – Methodological and scientificallyapproach to management

Taylor introduced the scientific study of work, as a response for the perception thatmanagers did not know how to manage work. He agreed that in order to maximize efficiencywithin an organization, true scientific studies of the best scientifically methods had to beconducted. He defended that the most effective way to manage work, individuals and theorganizations required the following steps:

Develop Scientific Methods for doing work Establish Goals for productivity Establish a system of rewards Train employees in how to use the scientific methods and apply it to work, in order to

meet the organizational goals.

Taylor defined 4 principles of management, which would reduce waste and increase efficiency inwork.


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2) Henry Ford – organizational functioning on basis of standardized tasks, which wouldreduce waste and increase efficiency.

Ford’s ideas on how to manage work came along with his Black T model and standardizedassembly lines. (+ Tools, - Employees)

Ford 3 principles of Management

3) Henry Fayol – determined both functions and principles of management

6 Functions of Management and 14 principles of Management

According to Fayol, management should be about: 1) Forecasting; 2) Planning; 3) Organizing; 4)Commanding; 5) Coordinating; 6) Controlling

And what would be the principles of guidance of management? Some of the 14 principles includeddivision of work, rewards, equity, stability of tenure, etc.

4) Max Weber – Bureaucratic Management

Weber argued that both management and organizational functioning should have its basis on aBureaucratic System. Bureaucracy would, according to Weber, help to manage work moreeffectively as, since every rule was written, every role clearly defined and the authority clearlyestablished, it would allow both coordination and understanding of everything done.

- Extensive Use of written papers, Extensive use of rules, well established system ofsupervision and subordination, etc.

In sum, the Classical Approach perceived management and organizational functioning as amethodological and scientifically study, where it was important to study and find the best ways todesign work , in such a way that efficiency would be maximized. The Classical Approach definedemployees as objects, whose main motivations were purely economic.

At the end of 19th century, study of management went from the classical approach, where therelationship of Individual & Organization had its basis on an Economic Exchange Norm ofReciprocity, to a Human Relations Approach, where the Norm of Reciprocity was defined as aSocial Exchange one.

5) Elton Mayo – Human Relations within the OrganizationMayo argued that the classical approach ignored the beyond the monetary motivation sources ofemployees, and that ignoring the human relation part would bring negative consequences to theorganization as a whole, by creating monotony, fatigue, reduced work environment, etc.

In order to understand the role of Human Relations in an organization, Mayo conducted severalexperiments, called the Hawthorne Experiment.

Illumination studies – Reduced Intensity of illumination level to see the effect on performanceo Outcome – Increase in Performance! – Mayo concluded that increase in performance

had as cause the positive emotional effects experimented by employees, as a result ofhaving a sympathetic or interested in observer!

Standardized Assembly

Lines

Increase Usage of

specialized tools

Eliminate Skilled workers


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With the Hawthorn Experiments, Mayo concluded that the work place was an interdependentsocial system, where the informal organization and work group norms also influencedperformance. Mayo also asserted that job performance is not only predicted by aptitudes (bestman for the job) but also dependent on external contextual social factors.

Until now, we’ve seen that management went from Efficiency Focus, to the Human Relations

integration (Mayo). In the 20th century, a new approach to organizations was introduced – TheSystems Theory.

6) Katz & Kahn – introduced the concept

of organizations as open systems, where theexternal environment interacts and getsinvolved with an organization. Therefore, bothauthors argued that it was important to assessthe degree at which the organization contextcould influence the behavioral structure of theorganization.

7) Emery & Trist – Contingency Theory

In the 70’s, besides considering the influence and relevance of the organizational external

context, it was acknowledge that, since the external environment was constantly shifting,

there was no best way to manage an organization, and that the success of the organizationdepended majorly on the ability of adjusting and adapting the organization to the externalchanges.

Emery & Trist provided some guidelines on how to manage effectively an organization, bycreating different types of environment in which one organization might be included.

How is the environment changing?

Low Fast

How complex isthe nº of

External

Elements?

Highly

Placid ClusteredLong Range Planning and

Forecasting

TurbulentPlanning is not useful, as

environment is shifting fast,Major Dynamics

Low

Random PlacidManagerial decision making

ignores environment, focus oninternal structure

Disturbed ReactivePlan, calculate and react to

possible threats, flexibility andsome degree ofdecentralization


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The Individual in Organizations

As the individual outcomes will depend much on the social exchange relationship betweenindividual and organization, it is of major relevance for management to study both individualprocesses (perceptions, motivations, attitudes, etc.) as individual characteristics

(personality).Nadler et Al emphasized the relevance of the individual study level by asserting that:

Individuals have different abilities Individuals have different needs and will try to satisfy them in different ways Individuals think about the future and will act in accordance to future

expectations Individuals will perceive differently the external environment, since this

perception will be based on individual needs and experiences Individuals have reactions to external stimulus, and their reactions will have

an affective component Behaviors and attitudes will have its origins in multiple individual factors,

therefore it is impossible to create a general theory to explain them.It is also important to understand that when analyzing the individual dispositions, such aspersonality, emotions, etc., a further analysis on the situation where the behavior occurred isrequired!

Personality

Behavior is a result of a complex interaction between person and situation. However, there seemsto be some specific characteristics of an individual that tend to remain in each behavior,independently of the context or the interaction. This specific features are what is calledpersonality!

In general terms, personality represents personal characteristics, either physical or psychological,that lead to consistent pat terns of behavior !

Where does personality come from? Nature or Nurture?

1) Nature – some studies point out that personality is something you’re born with, it’sgenetical and it will remain stable and will have little change across one’s life course.

2) Nurture – some studies (twins’ case) point out that personality is completely dependenton the influence of the external environment – Family, Context, Group Membership, allwill shape one’s personality!

Q: Why does it matter for organizations to assess or understand the personality of one individual

when, say, decide to hire him or to locate him within the organization?One employer will not see his employee personality, however, the behaviors of one individual willreflect these specific and consistent personal traits! Therefore, if one employer is able to assessthe employee’s personality traits, he will be able to track the profile features of that individual and

therefore know what to expect from that employee. Assessing one’s personality traits will also

allow the manager to best allocate each individual according to individual characteristics.

Is there any link between personality and Individual competences?

The need of understanding personality traits and how they might affect performance that severalmodels were created.

Need to recognize and

appreciate individual

dispositions in order to

understand and respond

appropriately to the behavior of

individuals in organization


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The Big Five Personality Factors – to assess relationship betweenperformance and personality traits

Personality divided into 5 dimensions/traits/factors.

The Big Five O’ allows organizations to assess

personality traits, which will then be related withthe job type and performance!

Now, what is the Best Personality Fit for one job?

There’s no straight answer, as personality thatbest fits will depend both on the job itself andthe context! For instance, for a sales personrole, probably an individual with a high level of

extraversion would be the best fit, however,that same person might also present low levelsof agreeableness, and within a sales context,and the ability to get along with clients and begentile is of major relevance.

The Meyer’s Briggs Type Indicator (MBTI)

The MBTI emphasizes that people can be typed into Introverted and Extroverted, but thatindividuals also have basic mental processes: Sensing, Intuiting, Perceiving and Judging.

Each Individual – yields 4 individual traits, and each individual will combine and differ in

combination of their preferences, resulting in 16 main personality types.Where do you get

your energy from?

Introversion Quiet, Concentrated, Reflective

Extroversion Outgoing, Interactive, dedicated to the other

What do you pay

attention to and

collect info on?

Intuiting General, Theoretical, Abstract

Sensing Practical, Detail Oriented, Specific

How do you

evaluate and make

decisions?

Feeling Subjective, Heart

Thinking Analytical, Rules Guided, Justice, Head

How do you orient

yourself to the

outside world?

PerceivingFlexible, Open Minded, Spontaneous

Judging Structured, Organized, Decisive

Besides these two major models on assessing personality, there are other models based on otherindividual dispositions that will help managers on what behaviors to expect from one individual:

Locus of Control - degree at which individuals believe they can control events affectingthem.

“Internals” – own behavior as primary cause for events

“Externals” - events determined by external sources (lucky,

chance, etc.)

Big Five O'Neuroticism - Degree to which one person

is secure, calm, free from persistentnegative feelings

Agreeableness - Person's ability to getalong with others; considerate, friendly,

helpfull, optimistic

Extraversion -Degree at which one personseeks company from the others

Consciousness - Related with self-

disciplin, self-responsability, goal-oriented, carefull

Openess to Experience- Related withimagination, creativity


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What is the relevance for managers to know one individual event orientation?

The locus orientation, internal or external, is linked with performance and job fit. For instance, itis argued that:

I. work requires complex info processing and complex learning

II. work requires compliance and conformity

III. work requires high motivation

IV. Work requires structured and directive style of supervision

Self- Esteem – extent at which individuals believe they are worthwhile and desiredindividuals; self-evaluation

High Self- Esteem – employees are likely to take risks, putmore value on attaining foals and display major willingnessto put extra effort to accomplish goals

Low Self- Esteem – employees are likely to procrastinate,

experience stress , conflict, to set lower goals and to beinfluenced easily´

Self – Efficacy - refers to one’s belief in one’s capability to perform a specific task. It isimportant because studies point out for a positive influence of the role of self-beliefs intask performance, key for motivation, key for productivity, etc. People who believe theycan perform well on a task (high self-efficacy) do better than those who think they will fail.

A and B Types - Individual’s personality is divided into 2 types, Type A ( where theindividual is featured by being competitive, impatient and ambitious) and Type B ( where

the individual is featured by being more relaxed, patient, easy going).

Abilities and Perceptions

Perception is an important cognitive process. Perception is a process, a filtering process, in whichone individual makes interpretations of the stimulus or situations he was confronted with.

The perception process begins with an individual being confronted with a stimulus or a situation(being mocked by the supervisor, group, etc.). Following the confrontation, the individual willinterpret the stimulus, and react (behave). The final outcome of the perception process is the

behavior of the individual as a response for the stimulus, that’s why it is important for organizationsto understand and build up the correct stimulus.

Internals will erform better

Externals will erform better

Internals will erform better

Externals will erform better

Individual

Cognitive Abilities

Intelli ence, Memor , etc.

Physical Abilities

Stren ht, Coordination.

Perceptions


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Situational Factors

The Importance of the Context

Situational factors will provide an external stimulus for the individual. The individual will react andbehave in a certain way that will depend on the stimulus. Therefore, and since the behavior islinked with performance, context and situational factors will indeed affect performance.

That’s why it is asserted that the best way to get a full picture of organizational functioning is to

look at the interaction between individual and situational factors (work environment, groupadherence, etc).

Emotions and Stress

The classical approaches on management and organizational behavior intended to leaveemotions outside of the sphere of organizations, as it was argued that emotions were negativelyrelated with performance and obstructed rationality. Nowadays, the myth of rationality wasdismissed, and it is assumed that emotions are necessary if one is to think rationally!

Why are emotions relevant for organizations to understand?

Emotions are the complex patterns of feelings of one individual towards an object or person!

While performing their job, individuals will experience a variety of emotions, either positive (joy,pride, affection, relief) or negative (anger, anxiety, shame, sadness, envy).

But, how does emotions affect one’s behavior within an organization, and therefore, one

individual’s performance?

Within the sphere of an organization, emotions are goal oriented, meaning that they are linkedwith emotions experienced towards one goal set by the individual. The process will be as follows:

It starts when one individual sets one goal, whether for a task or a goal related to personalrelations, something one individual is trying to accomplish. After the goal is set, the individual willexperience expectations on how he/she will feel if the goal is reached or failed. This anticipatoryemotions will drive the behavior of the individual: if the anticipatory emotions are sufficiently strongto motivate, than individual will engage in those behavior to attain the goal. If the goal is attained,then the individual will experiment positive emotions, which will affect the subsequent behaviors(set even higher goals, feel more competent, increase engagement, etc). If the goal attainment isnot accomplished, then negative emotions will emerge, negatively influencing future behaviors

(frustration, disinterested feelings, etc.). This is why emotion management (customer serviceexample) and emotion regulation (call centers) are required.

Context STIMULUS BEHAVIOR PERFORMANCE


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Emotional Intelligence

Refers to how well an individual handles oneself and others rather than how smart or how capablethe individual is in terms of technical skills. Emotional Intelligence is of major relevance if we are

talking about individuals whose task/performance will include getting along with peers/customers.

Salovey & Mayer, 1990, constructed the model of emotional intelligence, highlighting the role ofemotions within an organization:

Stress

Stress is the excitement, feeling of anxiety, and physical tension that occurs when the demandsor stressors placed on an individual are thought to exceed the person’s ability to cope. This is the

most common sense of “Distress” or negative stress! But, is it stress always a negative thing?

Distress – negative stress, resulting from demanding situations that persist through time.

Eustress – “Good Stress” that creates challenges to motivate people to work harder andachieve goals.

As seen in the first situation, stressors play animportant source of stress: there are variousforms of stressors (work load, group conflict,time pressure, etc.), however, they all haveone thing in common: they create stress whenan individual perceives them as representing ademand that exceeds its own ability torespond. The following stressors are thoserelated with work:

Model tries to assess people’s

abilities to recognize their feelings,others feelings (Recognition) andhow to readjust these to the context(Regulation).

You have it – Acknowledge andRegulate

You learn it – managing othersfeelings, understand othersemotions and manage to controlit


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Models on Stress

1) STRESS AS A PSYCHOLOGICAL RESPONSE (SELYE)

The first study on stress, by Selye on 1956, stated that stress was an emotional andpsychological response by the individual to a certain stressor. 3 stages (Reaction,Resistance and Exhaustion)

2) STRESS AS AN EXCHANGE/ TRANSACTION (LAZARUS)

According to Lazarus, stress is perceived as an exchange between the individual and thestressor! Lazarus pointed out 3 kinds of cognitive appraisals to one stressor, which willinfluence the way one individual will experience stress.

3) DEMAND/CONTROL MODEL (KARASEK)

Think about Nova. For instance, you have more than enough coffee machines, probablyeven more than what is required to fulfill the demand, however, Nova wants its studentsto feel that they have a lot of resources to do it! As to control over the stress, you can seethat some students feel more like studying at home while others feel more like studyingat the beach. It will depend on each individual control

over the stressor.

Focus on the balance between job requirements andautonomy! Karasek stated that those who experiencehigh demands with little control are more likely thanother employees to feel tress. Also, those who facehighly demanded jobs but have total control will be theones experiencing less stress.

Stress caused by highly demanding jobs can bemitigated by allowing a high level of control to theindividual!

Primary Appraisal

Subjective Evaluation of

stressor: Good or bad?

Assesses the impact for well-

Secondary Appraisal

Identifies and applies available

resources! Can I cope with the

stress?

(What strategy to overcome?)

No! I cannot overcome the stressor

Individual will experience increased

stress

Yes! I can overcome the stressordemand!

Individual will experience minimum

stress


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4) PERSON ENVIRONMENT FIT (FRENCH, CAPLAN & HARRISON)

This model tries to include as stressors notonly job factors but also otherexternal/environmental factors.

The relevance for stress of this model is that itargues that, whether relating how a person fitsin with the demands of a job or resources bythe job, incongruent person environment ft canlead to serious conflicts, poor performance andincreased levels of stress! If an organizationplaces an individual in a position where theyare unable to complete the demands of the job,the result can be very stressful.

It is therefore of major importance for managers to match abilities with job demands!

Stress & PerformanceHow does stress affects performance? Are they related? What about good and bad stress?

At low levels of stress, employees might not besufficiently alert, challenged or involved to perform theirbest (< comfort zone). Increasing the arousal of stressmight improve performance! But only until one point, thepoint up to where performance begins to deteriorate!

Managers should also be aware that stress is asubjective concept, and that too little stress for one

employee might be just the right one for another! Theoptimal amount of stress will depend on each individual!

Stress Management

There are majorly 3 ways to manage stress, or to mitigate the influence of work-relatedstressors on employee’s behavior.

Primary Prevention

Mostly preventive; the goal is to

reduce the number of stressors

Secondary Prevention

If the removal of stressors is

hard or unattainable, managers

will try to teach and train

people how to deal with stress

Tertiary Intervention

If the influence of work-related

stressors continues, than

managers will focus on treating

the consequences instead of

avoiding them.


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Job Satisfaction and Motivation

Job satisfaction reflects the extent to which individuals find fulfillment in their work! It might beperceived, in general terms, as a positive attitude towards the job.

The first book about the topic was published in 1935, “Job Satisfaction” , by Robert Hoppock’s.

Why is it important for organizations to try to assess the level of job satisfaction of theiremployees?

Employees who are highly satisfied with their jobs come to work regularly and are less likely totake sick days (low job turnover and low absenteeism).

Question: what are the dimensions of job satisfaction? Is the level of payment a higherheavyweight in job satisfaction than, say, the work itself?

According to some studies, the several dimensions of job satisfaction are ranked according to thefollowing way:

Work itself: Challenging, interesting, physical activity required, workingconditions and environment, etc

As we can observe, both the level of payment and promotion opportunities (tangible) are the twodimensions with the lowest impact/influence in the overall job satisfaction, while the perception ofthe work itself and the peer relations will contribute heavily to satisfaction.

1º Work itself

2º Co-workers3º Supervision4º Promotion

5º Pay

Stress

Management

Reduce Work Stressors

Improvements in physical work environment, job redesign (to reduce uncertainties and

increase control), changes in workloads and

deadlines, changes in work schedules, flexibility

in hours

introduce greater levels of employeeparticipation ( greater control usually leads to

lower levels of experienced stress)

Improved clarity and specification of roles

Modify Behaviors

Improvements on Team building Career Counseling and assistance

programs

Work Shops on Time Management

Training in Relaxation Techniques

Wellness Programs

Programs including disease prevention,

medical care, self-care and health

promotion! (Ex: providing discounts on

health clubs, healthy food chains, etc)


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Now, consider the following figure, which measures therelationship between life satisfaction and the level ofpayment, within a large range of countries.

Are there differences between countries?

It’s not about the level, but rather about perceptions.

According to our graph, we can see that countries suchas the USA and Switzerland, who have the highestincome per head, will tend to have a higher happinessIndex. This said, can we conclude that the higher thelevel of payment, the higher the level of happiness?

It will depend, much on the context. For instance, inCatholic countries, money is treated as something“dirty”, while in the US the importance of money is linkedto entrepreneurism, life achievement. Therefore, it ismore likely for countries such as the US to have higherlevels of happiness the higher the level of payment! Notconvinced yet? Think about Brazil.

Job Satisfaction Model

Question: How do you know/ do you evaluate yourself the level of satisfaction with your job?

Value-percept theory of satisfaction, Locke 1976

According to the value-percept theory of satisfaction, each individual will evaluate his own levelof job satisfaction:

( − ) ×

For instance, say that you want to calculate the level of satisfaction you have relative to yourpayment level: (pay WANT – pay HAVE) X Payment importance (e.g. your job satisfaction levelis driven by 50% from the payment level.

By looking at this expression, one can also add that the perception of satisfaction will vary fromperson to person, since each person will give his/her own relative importance to one specific jobsatisfaction dimension.

Moreover, the sources of job satisfaction and dissatisfaction will vary from person to person. Forinstance, one person might find that being a mortician (agência funerária) might not be a sourceof personal satisfaction, while on the other hand, there will be individuals which will derive a greatsense of job satisfaction from performing such a challenging job!

Question: Do you remember your first kiss date? How long did yourfirst date last?

No. But I’m quite sure that you were really satisfied. TRANSITORY


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The following graph reveals howdifferent emotions experienced duringone day at the job might influence thelevel of satisfaction.

During the morning, while reading e-

mails from the boss, your level ofsatisfaction might decrease, as you donot perceive this a challenging task.However, during a funny conversationwith a friend in the office, yoursatisfaction level might go up.

Job Satisfaction and Performance

It is a commonsense notion that job satisfaction leads directly to effective performance:

“ A happy worker is a good worker”

However, several studies point out for the inexistent relationship between job satisfaction andeffective performance. Studies point out that both job satisfaction and job performance areinfluenced and related to the individual’s personality, meaning that, a person’s locus of controland Big Five personality traits affect/mediate the relationship between job satisfaction and jobperformance.

For instance, an individual who holds positive attitudes towards their job (highly satisfied) but islow in conscientiousness may not work harder because the lack of responsibility makes him tofail to show up!

General attitudes might predict general behaviors, but specific attitudes are related most stronglyto specific behaviors. Job satisfaction is a collection of numerous attitudes towards variousaspects of the job (environment, peers, payment level, etc), and represents a general

attitude. Performance of a specific task can not necessarily be predicted on the basis of a

general attitude, but rather on a specific behavior (responsibility, self-discipline, etc).

Even though both job satisfaction and job performance are not strictly linked, studies have shownthat organizations with satisfied employees tend to be more effective than organizations withunsatisfied employees.

Job Satisfaction: Antecedents and ConsequencesJob Complexity (+)

Skill Variety Task Significance Autonomy

Stressors (-)

Role Conflict Role ambiguity Workload Interpersonal

conflict

Social and Organizational Support (+)

Person Environment Fit (+)

JS

Job Attitudes (+)

O. Commitment,

Carrer Satsfaction

Life Satisfaction

(+)

Strains (-)

Job tension, Anxiety, Stress

Job Performance (+)

Counterproductive Work

behavior (-)

Turnover intentions (-)


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Even though Job Satisfaction is not a directly cause of job performance, as we’ve seen, it is widelyacknowledge that satisfaction will, at least, influence the effectiveness of the organization itself.Therefore, it is up to managers to enhance satisfaction within the organization.

Practical ways to enhance Job Satisfaction:

Make jobs more fun, challenging, unambiguous, etc. Have a fair pay, benefits and promotion opportunities Match people with jobs that fit their interests and skills (person-environment fit) Design jobs to make them challenging, exciting and satisfying

MOTIVATIONMotivation represents the forces acting on or within a person that cause the person to behavein a specific, goal-directed manner.

Attracting and retaining individuals is a major concern for managers, therefore, the questionof what it takes to motivate individuals to work has received great attention. Motivation is notthe same as performance, since even the most motivated employee might not be successfulin their jobs, however, even if job performance involves more than motivation, motivation isan important factor driving high performance!The purpose of motivational theories is to predict the behavior of individuals, and derive

expected performance levels.

Performance = ( × ) ; ability alone isn’t enough to ensure performance athigh level, the person must also want to achieve that high level of performance (Motivation).

The Motivational Process – A Goal Oriented Process

1. NEEDS (IMBALANCE) – individual identify or experiences a certain deficiency, or need (needfor promotion, need for recognition, need for friendship from their peers, etc). These deficiencieswill make the individual to feel uncomfortable.

These will cause! These will be correlated! Will not cause, willinfluence or be influenced by JS

True or False?

1. Job Satisfaction has a strong impact on job performance ------------------- FALSE

2. Satisfied employees tend to have better physical health ------------------------- TRUE

3. Job satisfaction (itself) results in turnover ---------------------------------------------- FALSE

4. There exists a strong relationship between JS and stress -------------------------- TRUE (STRONG NEGATIVE RELATION)


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Primary Motives – those you are endowed with, and you try to satisfy them unconsciously,such as thirst, hunger, sleep, etc.

Secondary Motives – passed to individuals on culture, family, group membership, etc.For instance, in China affiliation to the Communist party is a motive, in Portugalcommunism is not appreciated, but social status is a high motive.

2. DRIVES (MOTIVES) – By feeling uncomfortable with a specific need, the individual will bewilling to make an extra effort to accomplish a specific goal (driving force) that will either reduceor eliminate a specific need.

3. INCENTIVES (BALANCE) – After acknowledging a specific need, the individual will have anincentive to achieve a specific goal that will eliminate that need. For instance, if you have a needfor promotion, you’ll work longer hours (perform) on your project to be promo ted!

After an individual performance, he will either receive a reward or a punishment, and willreassess/evaluate if the need has been eliminated or not.

How to Motivate Employees? Different Approaches

1) Content Theories – Satisfying Human needs

Maslow’s needs hierarchy – MOTIVATE BY SATISFYING HUMANNEEDS

Maslow suggested that individuals have a complex set of needs, than can be arranged in ahierarchy.

Once a need is satisfied, its motivational role declines and another need will emerge.

Lower level needs must be fulfilled before higher level needs are activated sufficiently to drivebehavior

Maslow stated that a person has 5 types of needs: physiological, security, affiliation, esteemand self-actualization.

Note: Even though the needs that Maslow identified may be universal, their importance and the ways inwhich they are expressed vary across cultures. For instance, in China, the value of collectivist and

community are more relevant than the needs of individual achievement, therefore, affiliation fulfillment wouldbe at a higher level than the esteem level of needs.


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Herzberg Two- Factor Model – MOTIVATE BY DESIGNING JOBS THATMOTIVATE INDIVIDUALS

Herzberg proposed that two sets of factors – Motivator Factors and Hygiene factors – were

the primary causes of job satisfaction and job dissatisfaction.

Motivator Factors are intrinsic to individuals, they are related to an individual’s positivefeelings about the job and the content of job itself.

Hygiene Factors are extrinsic to individuals, they are related with an individual’snegative feeling about the job and the environment in which the job is performed.

It is important to acknowledge that those factors which lead to job satisfaction, might not bethe same which lead to job dissatisfaction.

Managers tend to focus on Hygiene factors, and are sometimes perplexed because they arepaying high wages and salaries, provide working conditions and still employees are not

motivated. The problem is that they concentrate only on the hygiene factors, hygiene factorsprevent dissatisfaction BUT do not lead to satisfaction. According to Herzberg, hygienefactors are crucial to prevent dissatisfaction, but only a challenging job with opportunities forachievement, recognition, advancement, and growth will motivate personnel!

Vroom Expectancy Theory – MOTIVATE BY ENHANCING THE BELIEFTHAT REWARDS CAN BE ACHIEVED IF EFFORT IS MADE

The idea beyond the expectancy theory is that managers can motivate their employees bymaking them see that they can expect a certain reward by working hard to attain that reward!

Motivator Factors

Feeling of achievement Meaningful Work Promotion Opportunities

Recognition

Due to its intrinsic features, motivational

factors are hard to be influenced by

organizational policies. However, if one

organization defines what is, for instance,

exceptional performance, individuals will be

able to feel that they have performed their

tasks exceptionally well!

Hygiene Factors

Payment Status

Job Secutiry Working Conditions Interpersonal Relations

The reward system is a good example of hygiene

factors used to motivate employees. For

instance, providing a car, a cruise trip, is a good

example of motivating employees by making

them achieving higher dimensions of hygiene

factors.


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The expectancy model states that individuals are motivated to work when they believe thatthey can achieve things they want, being these things (or outcomes) satisfaction of safetyneeds, excitement of doing a challenging task, etc.

Variables of the Expectancy Model

EXPECTANCY: expectancy is the belief by an individual that an effort will be followed by aparticular level of performance; the expectancy variable has a range that goes from 0 to + 1;For instance, if you believe that even by studying OB that you have no change of getting agood grade on the exam, your expectancy value is 0, since you don’t make any

correspondence between the level of effort and the following level of performance!

If i exert a lot of effort, will I perform well?

INSTRUMENTALITY: instrumentality is the relationship between the outcomes associatedwith doing the job (high performance, quality of job, etc) and the rewards that will follow (payincrease, promotion, acceptance, job security, etc). The value of instrumentality goes from -1 to + 1. For instance, you know that if you received a lot of claps during the historypresentation that probably you will have a good grade, and therefore, your instrumentalitywill be positive, you know that if you’ve performed well and therefore you will have a goodgrade. If on the other hand you think that performing well will not be translated into a goodgrade, than your instrumentality will be 0.

If I perform well, will I receive outcomes?

VALENCE: valence is an individual’s preference for a particular reward. Outcomes having apositive valence will include being respected by coworkers, having job security, etc.Outcomes having a negative valence are outcomes that you want to avoid, an outcome hasa negative valence when it is not preferred or is to be avoided.

Will the outcomes/rewards be satisfying?


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Expectancy Model & Cultural Context!

For instance, a Canadian manager working in Japan decided to promote a young Japanesefemale to manager. The result was that the promotion diminished the Japanese femaleperformance! Why? It is also important to acknowledge that the expectancy model will work

best in cultures where individualism and self-achievement are seen as “good”; the previousexample showed that, since in Japan the need for harmony, the need of affiliation , is higherthan the individualistic reward, the promotion separated and embarrassed the Japanesegirl, driving down her work motivation.

Locke Goal Setting Motivational Theory – MOTIVATE BY ESTABLISHINGEFFECTIVE AND MEANINGFULL PERFORMANCE TARGETS

At the core of the Goal Setting Motivational theory is the argument that specific difficult goals arerelated to performance and satisfaction. Locke suggested that most effective performance seemsto be the result of specific and difficult goal settings. Besides setting a specific and difficult goal,effective performance is also the result of acceptance and commitment of employees to the goal,and that feedback on progress and on results provided enhances the effectiveness and motivationlevel of employees.

Why specific goals? Specific goals result in higher levels of performance, do you see thedifference “Try as hard as you can” and “We want you to achieve a level of 400.000$ in this period

of sales”?

SMART Goals (specific, measurable, attainable, realistic, time bounded)

Answer yourself: What is the relationship between self-efficacy and goals? Individuals exhibitinghigher levels of self-efficacy tend to set higher challenging goals and are more likely to achievethem!

The model Framework


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Adams Equity Motivational Theory – MOTIVATING BY TREATINGINDIVIDUALS FAIRLY

The equity model focuses on equity as a source of job satisfaction and performance. It is anothercognitively based motivation theory focused on an individual’s feeling of how fairly he/she is

treated in comparison with the others.The Model Framework

The equity model claims that individuals balance both inputs and outcomes. One individual willmake a contribution and expect a certain results (exchange process), but they will tend tocompare with others to determine whether the results obtained were or not fair.

Inputs: individual contribution to the exchange process, examples of inputs are attendance,technical skills, personal appearance, job effort (long hours), performance, past experience,educational level, etc.

Outputs: what the individual receives from the exchange process, examples of outputs are job security, pay increase, status symbols, working conditions, recognition, promotion,

responsibility, etc.

After providing their own individual contribution and receiving the outcomes of that contribution,individuals will compute the ratio of inputs and outcomes for themselves and compare it with theirperceived ratios of inputs and outcomes of others who are in similar situations. The “others” willbecome objects of comparison for individuals to determine whether the results were fair or not,whether they were equitably treated or not!

The comparison between the previous rations might or not trigger individual reaction to

restore the balance.

Equity will emerge whenever the perceived ratio of a person’s outcomes to inputs

equals the perceived same ratio of the others! We can expect no reaction by theindividual as to restore the balance.

=

ℎ′

ℎ′

For instance, your pay increase was higher than all the other members of your team, but youalso perceive that the amount of input (say extra hours) you put into the job is way higher whencompared to the other peers of your team, so you will feel properly paid.

Inequity will exist whenever the perceived ratios of outcomes to inputs are unequal.

1) UNDERREWARD INEQUITY

<

Tension within and among individuals

Individuals will react to restore

the balance!!!

Reduce inputs, such as reduce quantity of production, work shorterhours, be absent more frequently

steal from the company, ask to be transferred to another department


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2) OVERREWARD INEQUITY

>

How does the equity theory relates with motivation?

It is the striving of one individual to restore equity that is used as the explanation of workmotivation. The strength of the individual motivation is in direct proportion to the perceived inequitythat exists, Such a motivation can be, as we’ve seen, expressed in several forms: motivation to

alter both inputs or outcomes, cognitively distort the inputs (ex: feels underpaid for the job he hasdone and reacts by convincing that he hasn’t done that much), leave the field, act on the other orchange the other.

Equity theory lays down the foundations for the perceived fairness among several dimensions of justice, and it is directly linked to what is today called Organizational Justice!

Dimensions of Justice:

Distributive Justice – individual’s cognitive evaluation of whether or not the amounts andallocation of rewards in the social setting (say, company) are fair. – Is everyone getting whatthey deserve?

Research shows that employees perception of distributive justice are related to desiredoutcomes such as job satisfaction, organizational commitment, low turnover andperformance

Procedural Justice – is concerned with the fairness of the procedure used to makedecisions, it is shown that employees will be more motivated to perform at high level whenthey perceive as far the procedures used to make decisions about distribution of outcomes;for instance when employees perceive pay raises were made fairly, they will feel moresatisfied than if they had judged the procedures used to make the pay raise to be unfair.Procedural justice has been shown to relate with desirable outcomes, such as satisfaction,performance, etc.

Interactional Justice – perception of fairness related with the relation between individuals,supervisor and employee

Informational Justice

Why would a manager care about if the employee is perceiving to be fairly treated or not?

Research shows that:

Distributive justice is related with desirable outcomes, such as job satisfaction, performance,commitment, etc.

Employees will be more motivated to perform at a high level when they perceive as fair theprocedures used to make decisions on how to distribute the outcomes

When employees perceive their company to have procedural justice, reactions to frozensalaries during recession times will be low, as the used fair procedures will make him feel thathis interests are being protected

When a downsize happens and is handled fairly, those who stay feel more committed to theorganization

Individuals might feel uncomfortable, and might try to

grow the level of inputs through a more quality work


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Groups and Teams

What is the most relevant feature of a group which turns will turn group into a team?

Interdependence - a TEAM will be a group of two or more people who workinterdependently over some period to accomplish common goals (TASKINTERDEPENDENCE)

Now, why do organizations implement teams, and not only rely that individuals by themselveswill accomplish the tasks to be performed?

Teams allow managers to put the organizational strategy in practice (duas cabeças pensam melhor do que uma)

Team work increases efficacy and efficiency in more complex tasks (if the organizationaltasks are simple, team work could be ineffective as members would be wasting timediscussing a simple thing!)

Teams increase the quality of management (this will be related with the concept ofinformal organization, say that in your team you have a peer which is married with thechief executive of the human resources department, this will create an informal link whichwill facilitate communication and management)

Creating teams will allow synergies to be enjoyed, different perspectives will tend tocreate more creative and innovative ideas

Creating teams will increase and foster both autonomy and participation, releasing theburden of top manager of organizational daily problems and allowing focus on overallstrategy

Now, team work will also carry some problems or disadvantages:

× Conflicts ( which might not be bad by themselves, divergence in opinions usually bringsmore information, so conflict leads to more informed decisions)

× Norm violation ( you tend to criticize more the failure of one of yours, black sheet effect) × Free Riding× Risky Behaviors ( individuals tend to behave more properly and accordingly when they

know their performance relies only in themselves)× Conformity ( linked with cohesion – see the example bellow)

Bay of Pigs: In the US, Kennedy decided to invade Cuba, in what was called the Bay ofPigs Invasion. Some people attempted to present objections to Kennedy’s plan ofinvasion, but they were afraid this would affect the morality and cohesion of the team asa whole. The event turned out to be a fail because of the conformity of their members to

rely in the concept of “team” instead of presenting individual objections.


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Model of Team Efficacy: Why teams tend to have higher levels of performance and

satisfaction?

Previously we’ve discussed self -efficacy. In a similar sense, collective efficacy is a team’sshared perception of its capability to successfully perform specific tasks.

The first thing the model tries to explain is both individual and contextual characteristics that willinfluence the group/team behavior:

Aspect of the group itself that will influence the process and effectiveness are: skills needed toperform, group heterogeneity that assures positive interaction, and the experience with the jobthat will assure a group’s knowledge.

Contextual variables that are predicted to affect the process and effectiveness of the group are:supervisory behavior, rewards for group performance, training availability and market growth.


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5 Stages of Group Development

1. Group Forming- membersbecome familiar with each other;acceptance of the leader and

group consensus2. Storming – disagreementover procedures, tension

among members

3. Norming – Growth ofcohesiveness and unity,standardization of roles

4. Performing – Goal Achievement, high taskorientation, emphasis on

performance

5. Adjourning – completion oftasks, reduction of dependency

Managing Teams

How to make teams work better? How to manage conflict within the team?

Team conflict ( imbalance between perceptions, goals, values) might bring some disfunctionaleffects on the team outcomes! Why? Team conflict interfeers in team performance, productivity,enhances reduction on job satisfaction, creates mistrust among members and brings hostility tothe work sphere!

But.. is it team conflict always undesirable? It is necessary to separate the “healthy conflict” from

the “harming conflict”


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The good thing about conflict is that teams decisions will be better when conflict is at stake, sinceconflict will bring divergent opinions and different informations regarding the same subject.

Reaserch reveals that:

High performance teams will reveal to have high levels of conflictin all the dimensions (relationship, task and process) at the groupforming phase. In the norming phase, cohesiveness is enhancedand trust will reduce dramatically the level of task conflict (relatedwith awareness of differences in opinions and viewpoints of thetask). Focus on the task performance will represent a major driveforce for the high performance of these teams.

Low performance teams will start by entailing low levels ofrelationship, task and process conflict. Relationship is eased atthe beginning of the group forming and relationship conflict willremain stable at a high level during the team existence. The big

difference is that only when the group is being transformed into asolid team, members will realise the other’s different opinions onthe group’s task. After that, task conflict will exponentially grow,

as process conflict decreases ( we don’t really care).

Model on How to approach conflict:

LEADERSHIP

Question: What is the difference between a leader and a manager? What makes a manager aleader?

Leadership is accomplishing something through other people that wouldn’t havehappened if you weren’t there. And in today’s world, that’s less and less through comm andand control, and more and more through changing people’s mindsets and hence alteringthe way they behave . Today, leadership is being able to mobilize ideas and values that energizeother people.

Joint Problem Solving

Even though there is no “one gold rule” as to best respond to conflict, Collaboration

seems to apply as a good answer in the majority of the cases: there is a high concern

for satisfying all the parties, make the two parties working together and cooperating

and to find an alternative that integrates and fully satisfies the concerns of all (focus

on the task)! This is both assertive and cooperative!


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A leader is a person who exhibits the key attributes of leadership – ideas, vision, values – andthat is able to influence others to embrace his own ideas, visions and values into their ownbehaviors, therefore, changing and altering the way individuals behave. A manager directs,controls and plans the works of the others. Management is more about leading through tight anddirect controls, leadership is more about controlling by encouraging from the heart, inspiring ,

leading by the example, influencing the behavior by changing the mindset.

Leadership is related with SOCIAL INFLUENCE and POWER! What does this mean? It meansthat the process of leadership will enable the leader to control and influence the others towardsspecific goals, objectives, values, etc.

Without power to influence, a leader is not a leader! But where does this social power or influencecomes from?

Knowledge (individuals are influenced because they rely that the leader is in possession of wide knowledge – I will do what he is saying because that guyknows!)

Referent – (individuals are influenced because they admire, they are loyal totheir leader – Hitler!)

Legitimacy - ( individuals rely on their leader because he has legitimate power,for instance, you rely on what your teacher says because he is legitimate, thereis power attached to his role)

Reward – (individuals will rely on their leader because they know they will be

rewarded by doing so, example: Graaades!) Coercive ( leader is able to influence individuals because he will have the ability

to punish them)

The major questions regarding the early studies on leadership intended to answer the followingquestions: What is the best or more effective leadership style? Is there any difference betweenleaders? Where leaders do came from?

Iowa State leadership studies by Kurt Lewin: which one is the best leadership style: authoritarian,democratic or a laissez faire? Answer will be provided later! HINT: think about a democratic leaderin an institution such as the army, would it work?

WHERE LEADERS DO CAME FROM?

TRAITS THEORY

The traits theory argues that a leader is born a leader, leaders will be naturally endowedwith some traits that will turn them into leaders (something you are born with, notsomething you can attain); the main problem is that it ignores the situational specificity(think about the army again)BEHAVIOR THEORIES

Behavioral theories defend that leadership can indeed be learned, an individual mightbecome a leader without the need of naturally possessing specific traits to lead!

LEADERSOCIAL INFLUENCE

POWER


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CONTINGENCY OR SITUATIONAL THEORY

The situational theory suggests that different contexts and different situations will tend tohave different leaders and different levels of leadership effectiveness!

This model defends that the most effective leader will be, depending on thecontext, more people oriented or more task oriented!

The contingency model divides the situational control into 3 components

Leader-Member relation (Good or bad)

Task Structure ( Unstructured or structured)

Leader’s position/power ( Strong or weak)

The Fiedler’s contingency model states than an effective leader might use a high degree of task

behavior (use one-way communications, spell out duties, telling what to do) and only a moderateamount on others, such other situations will require an effective leader might use a high degree

of relationship behavior (using two-way communications, listening, encouraging, involving indecision making) in some situations.

If the situation is favorable, employees already assign the leader as a leader, and themost appropriate leader behavior would be task oriented.

If the situation is moderate favorable, then the most appropriate leader behaviorwould be relationship oriented, since there is not quite the perception of leadership.

If the situation is unfavorable, task is unstructured, the relationship between leader andmember is poor and the leader position is weak, than task oriented would be moreeffective.


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NORMATIVE MODEL – VROOM – 5 leadership styles based on 7 situational factors

The Vroom Leadership Model focuses on the relationship between 5 leadership styles and triesto assess which one of these 5 leadership styles the best choise in several decision is makingsituations.

5 CORE LEADERSHIP STYLES DECIDE STYLE – leader makes the decision without the team, by himself

CONSULT INDIVIDUAL STYLE – leader presents the problem to eachindividual, get their ideas and info’s and makes the decision alone

CONSULT TEAM STYLE – leader presents the problem to team members in ameeting, gets their suggestions and makes the decision

FACILITATE STYLE – leader presents the problem to the team and acts as afacilitator, allows the team to decide and acts as a coordinator on the discussion

DELEGATE STYLE – leader enables the team to make autonomous decisions (subordinate empowerment)

7 SITUATIONAL FACTORS:1. Decision significance ( how important is the decision)2. Importance of commitment (how important is subordinate commitment to the decision)3. Leader Expertise ( does the leader believe to have enough info to make decision)4. Likelihood of commitment ( if the leader makes the decision, will subordinates be

committed to it)5. Team support ( do subordinates share the goals to be achieved by solving this problem)6. Team expertise ( are team members able and informed to make the decision)7. Team competence ( are team members capable of handling the decision making on their

own)It will be the relevance given to the 7 situational factors that will determine whether one of the5 leadership styles is the more effective one!

For instance, if the decision is relevant for theorganization, subordinates are highly committed to thedecision, the leader expertise is high but if the leadermakes the decision the commitment will be low, and theleader perceives the team as capable, to be highlysupportive and competent to handle the decisionmaking, than the best leadership style would be adelegate one! (Empower subordinates)

If the decision is important for the organization, and bymaking the decision the leader would be able to committhe employees to that decisions, than the best leadershipstyle is a decisive one!


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Leader behavior will be motivational (e.g., will increase subordinate effort) to the extent that(1) it makes satisfaction of subordinate needs contingent on effective performance, and (2)it complements the environment of subordinates by providing the coaching, guidance,

support, and rewards which are necessary for effective performance and which may otherwise

be lacking in subordinates or in their environment.

MODERN THEORIES ON LEADERSHIP

LEADER-MEMBER EXCHANGE (LMX) – TREAT EACH ONE INDIVIDUALLY, AS EACH ONE IS

DIFFERENT

The LMX model enacts leadership as an interaction between the supervisor and thesubordinate! It suggests that if leaders are able to create high valuable relationships, thenhigh performance should result, however, Leaders will establish high LMX relationships witha limited number of subordinates (called the in-group), and these, contrary to those outsideof the “in-group”, will receive more rewards, have more info, etc. LMX assumes that in this

leadership style the leader will essentially divide subordinates as an in or an out member.

The Leader-Member Exchange relationship will contribute to several organizational outcomes,such as organizational commitment, as the following graph suggests:


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SOE = Supervisor Organization Environment = extent to which the supervisor internalizes theorganization

The graph suggests that high valuablerelationships between supervisor and

subordinate will result in higher levels ofaffective commitment.LOW SOE reveals that the impact of therelationship between employee commitmentand the organization will be low if thesupervisor does not share values of theorganization!

TRANSACTIONAL & TRANSFORMATIONAL LEADERSHIP

The idea of transactional leadership involves an exchange relationship between leaders andfollowers! The relationship between leader and follower can be perceived as a trade relationship,where the leader will guide by making sure that followers understand that good performance willbe rewarded (contract of exchange of rewards for effort, rewards for good performance, etc). Thecharacteristics and approaches of transactional leaders are described below:

Quest ion : Would a transactional leadership style be effective nowadays? Why?

We know that transactional leadership has its basis on an exchange/trade relationship betweenemployee and leader; the current economic environment might impose obstacles to, for instance,rewards, a leader might require extra efforts in name of the organizat ion’s future sustainability but

might be unable to provide the reward part of the exchange relationship. Without the “reward” partof the equation, followers might feel motivated not to extra perform since their performance willnot be recognized (in the sense of what they perceive to be recognition= reward). Nowadays,something else is required!

Transformational leadership goes beyond the trade relationship as it is based more on leader’s

shifting the values, beliefs and needs of their followers! The key to transformational leaders is thatthey seek to empower and elevate followers!The transformational leader will lead by an idealized, inspiring, intellectually stimulating and

individually concerned leadership manner!

Practical Example: Usually, when members of the organization are asked about what their organization stands for, the answer is

restricted to a description of either the service or the production process! This is a clue that they don’t have any idea of both the VISION

and MISSION of the company! (Their commitment is probably low); recommendation is for the supervisor first to make sure that

employees are aware of the purpose of existence of the organization! Commitment should result, and if high valuable relationships = >ENHANCED COMMITMENT


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Transformational leaders are usually the ones which will better internalize the idea of what theorganization stands for, and will be able to transmit that to their followers! More than atransactional leadership style, transformational leadership is positively related with highercommitment, trust, higher levels of self-efficacy and other relevant variables which will influenceperformance.

THE FINAL ANSWER TO MOST EFFECTIVE LEADERSHIP STYLE AND MAJOR

CHALLENGES

Why is leadership important? What is the most effective leadership style?! Authoritarian?Democratic? Laissez faire? Charismatic? Delegate style? Transformational?

1) Why is leadership important?

Dr. Quinn Mills (2005) highlighted the importance of having a leader. The author suggested thatsuccess of an organization is usually assigned to timely, completeness and

appropriateness of decision-making. However, this approach, according to the author,misleads the fact that after the decision making, implementation is required, and that only

with effective implementation organizations can strive for success. Implementation of an

organization’s goals is the role of the leader. An effective leader sets the direction of the

followers to the goal of the organization, by influencing, motivating and being able to

change behavior towards the path of the organization’s goals.

2) What is the most effective leadership style?

The answer is: EFFECTIVENESS IS CONTEXTUAL! There is no rule of thumb as to theleadership style to use, as different situations, different sets will require different leadershipmanners! For instance, in the army, tough decisions have to be made fast, a democraticleadership style would probably result in waste of time for strategy! Under crisis requiring dramaticchanges or under situations where followers are very dissatisfied with the status quo, charismaticleadership (self-confident leaders who project high expectations for followers, stand forideological visions and uses personal example) will be a more effective leadership style, asconfidence will enable followers to identify with the leader and his mission, make them exhibit

extreme loyalty and be motivated by deriving self-esteem from their relationship with the leader!

The only requirement for an effective leadership is that it must BE CONSISTENT! (You wouldnot like to have an authoritarian boss today that will change into a democratic one

tomorrow, it just doesn’t make sense).

Secrets of Inspiring leaders: Demonstrate Enthusiasm Consistency Sell the benefit Invite and Stimulates participation

Encourages potential


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Question: In such a globalized world, what is the major challenge faced as to the leadershipquestion?

Portuguese Example

When Alvaro Pereira, former Minister of Economy, came from Canada to chair the Economy, he

wanted to make several changes as to the organizational structure of his office. One of thechanges he first made when arriving to the office, was to ask all the personnel not to call him as

“Dr.”, but by his first name: Álvaro! How did the subordinates react? The next day, everyone was

mocking with “Alvarinho”.

What does this tells us?

Portuguese culture (and most of Latin Cultures) entails that there should be a well-defined

hierarchy within an organization, trying to implement changes without assessing the context will

just not work.

Do you think that, in a collectivist society such as the Chinese one, a task oriented leadership

style would be more effective than a team oriented one (team oriented, integrative, etc)?


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SOCIAL EXCHANGES

What is a social exchange?

Social exchange deals with individual willingness to reciprocate care and consideration

expressed within a relationship!

TRUST

One can provide several definitions of trust, such as “actions that increase one’s vulnerabi l i ty to

another whose behavior is not under one’s control” , but they will all share the same two main

features beyond the idea of trust: VULNERABILITY and INTERDEPENDENCE!

You can only trust someone if 1) you are vulnerable to the other, since 2) you are not in

control on the other’s behavior!

2 FORMS OF TRUST, combined lead to overall trust1) Cognitive Form of trust (about integrity)

2) Affective form of trust (About the other)

And there are 3 different dimensions of trust:

Now, what is the importance of trust within the sphere of organizations? Why is trust in leader

such an important thing?

SOCIAL EXCHANGES

TRUST

JUSTICE

SUPPORT


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Dirks and Ferrin composed the following model framework to explain why trust in leadership is

important for organizations?

What does this model tells us?

As we’ve seen, the definition of trust includes both interdependence and vulnerability. A leader

has to be trusted in order that followers are prepared to open up regarding their fears and

vulnerabilities.

Within a work environment, relationships either between employee-supervisor and employee-

coworkers will be trust-based, as one individual will feel vulnerable to the others actions and the

inability to control the other’s behavior will enhance the interdependence of both actions.

The above model indicates that trust will depend on 1) the characteristics of the trustee (ability,

integrity and benevolence), 2) characteristics of the trustor (predisposition to trust) and 3) the

context; and that trust in leadership is significantly related to attitudinal, behavior and performance

outcomes.

As to the attitudinal outcome, it was found that: Trust in leadership has a significant relationship with both job satisfaction and

organizational commitment;

As to the behavioral outcomes, it was found that:

Trust is significantly related to altruism, courtesy, conscientiousness, civic virtue;

As to the performance outcomes, it was found that:

Trust in leadership is related with job performance and extra role performance


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TRUST AND ORGANIZATIONAL CHANGE: Impact of trust in organizational commitment

during organizational change

Does trust in supervisor have a positive

effect on employee’s readiness for

change? As Neves and Caetano argued, the

relationship between trust in the

supervisor and commitment was

stronger when employees had lower

perception of control over the change.

Thus, trust results in a positive effect on

the employee’s readiness for an

organizational change!

FAIRNESS

Another social exchange relation is the concept of fairness/justice.

Recall the definition of social exchange:

Social exchange deals with individual willingness to reciprocate care and consideration

expressed within a relationship!Fairness is a social exchange because it deals with one individual willingness to reciprocate

fairness if he perceives fairness and justice within a specific relationship! (If you are fair with me,

I’ll be willing to be fair with you!)

What are the types of justice that exist? Why is it important within the context of organizations?

There are 3 main types of justice:

Distributive Justice - related with the concept of equality, it is basically

the perception of one individual of whether or not the amounts and

allocations of rewards (payment, evaluations, etc) are being fairly

distributed – Am I being fairly evaluated when compared to the others?

Procedural Justice - perception of one individual regarding the procedure

used to make decisions - Is the promotion criteria applied equally

throughout all employees?

o Procedural justice is applied when the decision made is (CBAREC)

1) Consistent – apply promotion criteria to everyone equally

2) Bias suppressed

3) Accurate – promotion was made regarding the volume of sales

Practical Example: Think about the case of the sinking ship Costa Concordia. By observing the behavior of the cruise members define

the impact of trust in leadership and followers behaviors.


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4) Representative – decision should rely on everyone, if we have two

different groups, both parties should be part of the decision (similar to

consistency)

5) Correct – “Ok, I say it is penalty so it is penalty” – lacks correct

ability6) Ethical

Interactional Justice – degree to which people affected by a decision are

treated with dignity and respect; for instance, being reprehended via text

message will make subordinate to hold feelings of resentment towards ther

supervisor.

Now, how important is justice within the organization? (ORGANIZATIONAL JUSTICE )

If you recall, one of the motivational models had its basis on the perception of the individual

regarding the ratio of inputs and outcomes:

In this framework, the employee perceived, when

comparing to other’s same ratio, inequity, and would react

in order to restore balance! (Ex: decrease inputs)

One can, therefore, link distributive justice to this motivational model, as the employee will

perceive that the allocation of rewards is being misallocated and will be motivated to react to

restore the balance, by, say decrease the level of effort!

Thus: JUSTICE CAN HAVE AN IMPACT IN MOTIVATION!

Now, what other outcomes can we derive from organizational justice or fairness?

REACTIONS TO DECISIONS & THE LEVEL OF JUSTICE

When the level of distributive justice

is high, lower reactions to authority.

On the other hand, if employees

perceive that the rewards of theprocess will be misallocated, they will

try to understand what is going within

the process and respond more actively

towards the authority decisions!


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PERCEIVED ORGANIZATIONAL SUPPORT

Perceived organizational support is the extent to which one perceives, both, that the organization

values his/her contribution and cares about his/her own well-being. This inference/perception

about support from the organization will be based on actions and will serve two main purposes:

Being regarded highly by the organizat ion helps to m eet employees' needs for

appro val, esteem, and affi l iat ion . – they care about me, I belong here

Posit ive evaluat ion by th e organizat ion also p rovides an indicat ion th at

increased effort w i l l be noted and rewarded. – if I try hard and succeed, and I know

they will evaluate because they value my contribution, then I know I will be rewarded

(instrumentality 1+?).

Perceived organizational support (POS) might be valuable for organizations, as it is positively

related with increase in self-esteem, increase in importance of valuable relationships

and, the most important of all, affective commitment to the organization, which by itself

is correlated with performance. (Notice that POS is not directly related with performance,

but might be mediated).

Pay Cut & Level of Theft by Employees: Importance of POS

The following study reveals that when

the level of POS is high, reaction to pay

cuts by employees is lower, as high levels

of POS are usually related with

commitment to the organization (

employees will identify with what the

organization stands for and accept more

easily the pay cut as a mean of keeping

sustainability)

P.O.S IMPORTANT

FOR

ORGANIZATIONAL

CHANGES!!!!


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Join ing i t a l l: What are the major influences of social exchanges within the organizational

context?

By looking at the above figure, we see that both POS and FAIRNESS will have a positive impact

on the level of trust. Trust in the leader and in the organization, by opening and mitigating the

follower’s fillings of fears and vulnerability, will mediate and result in desirable outcomes for the

organization: enhanced job satisfaction and higher levels of commitment.

The relevance of trust is therefore highlighted as the bridge between perceptions and outcomes.

Now, how to create a trusting environment within the organization?

In what concerns the relationship sphere (INTERPERSONAL employee/supervisor or

employee/co-worker), there are several ways to enhance trust:

LEAD BY EXAMPLE (if you do not act in accordance with what you are standing for, howcan one trust you?)

BE CONSISTENT ( what makes an effective leader is also the consistency, and

consistency is also important for justice perceptions)

BE FAIR ( but not disregarding individual differences)

SHOW THAT YOU CARE (valuable relationships , employees will trust you, follow you

and accept your decisions)

COMMUNICATE OPENLY (see what happened with Ricardo Salgado?)

FULFILL YOUR PROMISES

In what concerns the organizational level, there are several ways on how managers can enhance

trust:

Provide tra in ing for your middle/ line managers

CREATE A VISION

Promote co herence b etween h ierarchica l levels (remember ro le of consistency?)

Organize space in l ine with cul ture ( design jobs )

Manage contro l sys tems with care

Manage organizat ion al ch ances careful ly


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ORGANIZATIONAL CULTURE & CHANGE

What is organizational culture? Why is it important? How is the culture of an organization

transmitted? What are the possible outcomes of having a strong culture?

Organizational culture is the shared and learned values, beliefs and attitudes of organization

members. The culture of an organization plays a large role in determining the quality of

organizational life, it is a col lect ion of un spoken ru les and tradi t ions that wi l l operate 24

hours a day.

The culture of an organization is hard to define, as one will only perceive what the organization

stands for by observing the behaviors of the employees. This enhances the assumption that an

organizational culture is often hidden, and resistant to change.

Characteristics of Culture

National Similarity

Historic Influence

Collective Creation

Dynamic Character

Learned

Shared

Visible and Invisible

Now, how does an organizational culture emerge? And how is it transferred along the

organization?

Influence of Context in Organizational culture

First, it is important to acknowledge that the cultural context of the organization will strongly

influence the way an organizational culture will be set, by molding several cultural dimensions,

such as power distance, uncertainty avoidance, individualism/collectivism, gender role orientation

and long term orientation

For instance, in countries such as Korea and Taiwan, power distance is regarded as a high

valuable cultural dimension, and thus it is valid to assume firms within this country to be

represented by a better defined hierarchical culture than say, firms in Australia or the US, where

power distance is not such a relevant cultural dimension.


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Influenced by the society context in which the organization is insert, top management will define

what the organization will stand for, by designing what they expect their employee’s behavior to

be and developing a shared vision of the culture within the organization.

How will this “designing of expected behavior in accordance to the culture of the

organization” be transferred?

Managers will be able to impose the culture of the organization through what is called the

organizational socialization process, in which the transmission of an organization’s cultural

values from leaders and senior employees to new employees will occur, providing them with the

knowledge (norms and values) and skills needed to become a part of the organization.

What is the importance of the socialization process?

The socialization process is where the employee will reach a psych ologica l contract with the

organization, he will accept, adopt and adjust his own behavior towards what is designed by the

company. It is here that organizational commitment will start to be built.

Now, after setting what the organization stands for, its values, norms, assumptions, expected

behaviors, practices, etc. and after these norms are accepted and adopted by the employees,

what can we expect to be the outcomes of having a sense of belonging to, of being part of the

culture?

Reduced uncertainty and anxiety surrounding the job, as practices and what is expected

employee’s behavior is clearly defined and acknowledged (Role Clarity)

Higher job involvement and higher commitment to the organization (collective

compromise)

Understanding of what the organization stands for, which will enhance the perception of

control

Creation of stability within the organization


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The final question will have to be: Will the Organizational Culture be related with

performance?

The answer is yes. Besides the potential to enhance individual satisfaction, the sense of certaintyon how problems are handled, and so on, organizational culture has potential to enhance

organizational performance. Knowing the culture of an organization allows employees to

understand both the firm’s history and methods of operation (what is expected to be my

behavior). Then, organizational culture will help to foster collective commitment to

corporate philosophy and values. Commitment will, by itself, generate shared feelings of

working toward common goals. Organizational culture also serves as a control mechanism

to channel behaviors towards desired behaviors, which might relate directly to greater

effectiveness of the company itself (increased organizational performance) and constitute

a major competitive advantage

The Role of th e Leader in the Organizat ional Culture

In general terms, it is the role for the leader to assure the expected behaviors of their followers by

setting what the organization stands for, and to assure the maintenance of the culture. There are

two main mechanisms on how leaders can affect culture.

PrimaryMechanisms

PAYING ATTENTION ; dealing with events systematically (consistency) will provide the guidance to

employees about what is important and what is expected of them REACTIONS TO CRITICAL INCIDENTS AND CRISIS; the way a leader deals with incidents will

reinforce its culture; say that one employee disrespected one of the core values defended by the

company, reprehension might reinforce

ROLE MODELING ; the leader will communicate the organization values by practicing them DISTRIBUTION OF REWARDS ; employees can learn about an organization culture through its

reward system, which will set priorities and values of the organization

CRITERIA FOR HIRING, PROMOTION AND FIRING ; a leader might also influence theorganizational culture by, for instance, hiring people whose personality fits the culture (ex: google,

sou

Documents

Organizational Behavior Theoretical Notes