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Organizational BehaviorOrganizational Behavior

Organizational BehaviorOrganizational Behavior

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Contents

Publisher Information x

Chapter 1: Organizational Behavior

1.1 College Textbook Revolution 2 1.2 Understanding Organizational Behavior 4 1.3 Understanding Your Learning Style 14 1.4 Understanding How OB Research Is Done 17 1.5 Trends and Changes 22 1.6 Maintaining Core Values: The Case of Nau 31 1.7 Conclusion 33 1.8 Exercises 34

Chapter 2: Managing Demographic and Cultural Diversity

2.1 Doing Good as a Core Business Strategy: The Case of Goodwill Industries 37 2.2 Demographic Diversity 40 2.3 Cultural Diversity 64 2.4 The Role of Ethics and National Culture 75 2.5 Managing Diversity for Success: The Case of IBM 79 2.6 Conclusion 82 2.7 Exercises 83

Chapter 3: Understanding People at Work: Individual Differences and Perception

3.1 Advice for Hiring Successful Employees: The Case of Guy Kawasaki 86 3.2 The Interactionist Perspective: The Role of Fit 89 3.3 Individual Differences: Values and Personality 92 3.4 Perception 112 3.5 The Role of Ethics and National Culture 122 3.6 Using Science to Match Candidates to Jobs: The Case of Kronos 127 3.7 Conclusion 130 3.8 Exercises 131

Chapter 4: Individual Attitudes and Behaviors

4.1 People Come First: The Case of SAS 134 4.2 Work Attitudes 136 4.3 Work Behaviors 147 4.4 The Role of Ethics and National Culture 160 4.5 Rebounding from Defeat: The Case of Jeffrey Katzenberg 163 4.6 Conclusion 165 4.7 Exercises 166

Chapter 5: Theories of Motivation

5.1 A Motivating Place to Work: The Case of Zappos 170 5.2 Need-Based Theories of Motivation 172 5.3 Process-Based Theories 183 5.4 The Role of Ethics and National Culture 199 5.5 Motivation in Action: The Case of Trader Joe’s 202 5.6 Conclusion 204 5.7 Exercises 205

Chapter 6: Designing a Motivating Work Environment

6.1 Motivating Steel Workers Works: The Case of Nucor 208 6.2 Motivating Employees Through Job Design 210 6.3 Motivating Employees Through Goal Setting 223 6.4 Motivating Employees Through Performance Appraisals 232 6.5 Motivating Employees Through Performance Incentives 241 6.6 The Role of Ethics and National Culture 248 6.7 Motivation Key for Success: The Case of Xerox 251 6.8 Conclusion 253 6.9 Exercises 254

Chapter 7: Managing Stress and Emotions

7.1 Facing Foreclosure: The Case of Camden Property Trust 256 7.2 What Is Stress? 258 7.3 Avoiding and Managing Stress 272 7.4 What Are Emotions? 284 7.5 Emotions at Work 289 7.6 The Role of Ethics and National Culture 297 7.7 Getting Emotional: The Case of American Express 300 7.8 Conclusion 302

7.9 Exercises 303

Chapter 8: Communication

8.1 You’ve Got Mail…and You’re Fired! The Case of RadioShack 307 8.2 Understanding Communication 310 8.3 Communication Barriers 315 8.4 Different Types of Communication and Channels 328 8.5 The Role of Ethics and National Culture 345 8.6 Employee Satisfaction Translates to Success: The Case of Edward Jones 350 8.7 Conclusion 352 8.8 Exercises 353

Chapter 9: Managing Groups and Teams

9.1 Teamwork Takes to the Sky: The Case of General Electric 356 9.2 Group Dynamics 358 9.3 Understanding Team Design Characteristics 368 9.4 Management of Teams 384 9.5 Barriers to Effective Teams 390 9.6 The Role of Ethics and National Culture 392 9.7 Green Teams at Work: The Case of New Seasons Market 395 9.8 Conclusion 397 9.9 Exercises 398

Chapter 10: Conflict and Negotiations

10.1 Negotiation Failure: The Case of the PointCast 400 10.2 Understanding Conflict 402 10.3 Causes and Outcomes of Conflict 408 10.4 Conflict Management 413 10.5 Negotiations 420 10.6 The Role of Ethics and National Culture 435 10.7 Avoiding Conflict at WorldCom: The Case of Bernard Ebbers 438 10.8 Conclusion 441 10.9 Exercises 442

Chapter 11: Making Decisions

11.1 Decision-Making Culture: The Case of Google 446 11.2 Understanding Decision Making 449 11.3 Faulty Decision Making 461

11.4 Decision Making in Groups 466 11.5 The Role of Ethics and National Culture 475 11.6 Empowered Decision Making: The Case of Ingar Skaug 478 11.7 Conclusion 480 11.8 Exercises 481

Chapter 12: Leading People Within Organizations

12.1 Taking on the Pepsi Challenge: The Case of Indra Nooyi 486 12.2 Who Is a Leader? Trait Approaches to Leadership 489 12.3 What Do Leaders Do? Behavioral Approaches to Leadership 497 12.4 What Is the Role of the Context? Contingency Approaches to Leadership 503 12.5 What’s New? Contemporary Approaches to Leadership 513 12.6 The Role of Ethics and National Culture 529 12.7 Leadership Development: The Case of Starbucks 534 12.8 Conclusion 536 12.9 Exercises 537

Chapter 13: Power and Politics

13.1 Focus on Power: The Case of Steve Jobs 541 13.2 The Basics of Power 544 13.3 The Power to Influence 552 13.4 Organizational Politics 566 13.5 Understanding Social Networks 572 13.6 The Role of Ethics and National Culture 577 13.7 Getting Connected: The Case of Social Networking 581 13.8 Conclusion 583 13.9 Exercises 584

Chapter 14: Organizational Structure and Change

14.1 Organizational Structure: The Case of Toyota 590 14.2 Organizational Structure 592 14.3 Organizational Change 605 14.4 The Role of Ethics and National Culture 624 14.5 Changing for Good: The Case of Hanna Andersson Corporation 627 14.6 Conclusion 630 14.7 Exercises 631

Chapter 15: Organizational Culture

15.1 Building a Customer Service Culture: The Case of Nordstrom 634 15.2 Understanding Organizational Culture 636 15.3 Characteristics of Organizational Culture 641 15.4 Creating and Maintaining Organizational Culture 653 15.5 Creating Culture Change 671 15.6 The Role of Ethics and National Culture 676 15.7 Clash of the Cultures: The Case of Newell Rubbermaid 679 15.8 Conclusion 681 15.9 Exercises 682

Please share your supplementary material! 685

Publisher Information

Organizational Behavior is adapted from a work produced and distributed under a Creative Commons license (CC BY-NC-SA) in 2010 by a publisher who has requested that they and the original author not receive attribution. This adapted edition is produced by the University of Minnesota Libraries Publishing through the eLearning Support Initiative.

This adaptation has reformatted the original text, and replaced some images and figures to make the resulting whole more shareable. This adaptation has not significantly altered or updated the original 2010 text. This work is made available under the terms of a Creative Commons Attribution-NonCommercial-ShareAlike license.

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Chapter 1: Organizational Behavior

Learning ObjectivesLearning Objectives

After reading this chapter, you should be able to understand and articulate answers to the following questions:

1. What is organizational behavior (OB)?

2. Why does organizational behavior matter?

3. How can I maximize my learning in this course?

4. What research methods are used to study organizational behavior?

5. What challenges and opportunities exist for OB?

1.1 College Textbook Revolution

The traditional textbook publishing model no longer serves the interests of students, educators, and authors. Textbooks are too expensive for students and too inflexible for instructors. And authors, the major, initial source of value in the industry, are increasingly confused by faster revision demands and their compensation for those revisions. Flat World addresses all these industry pain points.

Jeff Shelstad

In 2007, two textbook publishing industry veterans, Jeff Shelstad and Eric Frank, started a privately held company, to be a new and disruptive model for the college textbook market. Traditional business textbook publishers carry a portfolio of 5 to 10 titles per subject and charge premium prices for new textbooks, an average of $1,000 in textbooks for a college student’s first year, according to a recent General Accounting Office (GAO) report. FWK’s strategy aims to turn the traditional model on its head by providing online textbook access free to students. FWK earns revenues by selling students the digital textbooks in alternate formats, print and audio initially, and also by selling highly efficient and mobile study aids. Despite the fact that professors have rated the academic quality of FWK textbooks as equal to or higher than that of textbooks from traditional publishers, the cost to students is a fraction of current market prices due to the efficiencies of the FWK business model. Moreover, with FWK’s platform, instructors who adopt FWK books for their classes are able to pick and choose the material provided to their students, even if it is from earlier versions of textbooks that have since been revised.

Shelstad and Frank previously served as the editorial director and the marketing director, respectively, at Prentice Hall, a major U.S. publisher of educational materials and a division of Pearson PLC. They resigned from Prentice Hall in January 2007 with plans to start a higher education publishing business together. During the first several months, they met with many students, professors, authors, advisors, and potential angel investors. Shelstad became the CEO; Frank was the chief marketing officer. They also added David Wiley as the chief openness officer.

Asked why he started FWK, Shelstad said, “I was convinced the college textbook publishing industry model was broken.” He added, “When more and more students are running from your core product, you have a problem. For example, many leading business school textbooks sell in the college bookstore or on various Internet sites for $150 or more. Students by and large don’t see that value. So they search franti- cally for substitutes, and the Internet has made the availability and pricing of substitutes very obvious.” In its first term (fall of 2009), FWK had 40,000 students using its textbooks. This steadily continued to rise as faculty discovered the low-priced alternative that combined quality and affordability for their students. As of January 2013, FWK has published more than 100 books, with faculty customers at more than 2000 institutions in 44 countries. As a result, more than 600,000 students have benefited from affordable text- book choices that lower costs, increase access, and personalize learning.

Media attention regarding the fledgling FWK was generally very favorable. Social media experts also gave the company accolades. For example, Chris Anderson devoted a page to the FWK business model in his

bestselling book ”Free: The Future of a Radical Price.” Moreover, early user reviews of the product were also very positive. For instance, an instructor who adopted an early FWK text, Principles of Management, noted, “I highly recommend this book as a primary textbook for…business majors. The overall context is quite appropriate and the search capability within the context is useful. I have been quite impressed [with] how they have highlighted the key areas.” At the same time, opportunities to improve the Web interface still existed, with the same reviewer noting, “The navigation could be a bit more user friendly, however.” FWK uses user input like this to better adjust the strategy and delivery of its model. This type of feedback led the FWK design squad to improve its custom Web interface, so that instructors can more easily change the book.

Further changes occurred in late 2012, when the company announced it would no longer offer free online access to its textbooks. Moving from “free to fair” (the entry point for students is now $19.95) was a diffi- cult but necessary decision. On its website, the company explained:

“As the transition to digital has changed student buying trends, the free format has become a barrier to our long-term growth and ability to offer a fair and affordable model that works for all our customers, from individual students and instructors to our institutional partners.”

In December 2012, the company announced the appointment of Christopher Etesse as CEO. Etesse is a former senior executive and Chief Technology Officer with Blackboard Inc. Shelstad will remain with the company in a strategic role as Founder.

Only time will tell if the $30 million invested in FWK by 2012 will result in the establishment of a new titan in textbook publishing or will be an entrepreneurial miss.

Based on information from United States Government Accountability Office. (2005, July). College text- books: Enhanced offering appear to drive recent price increases (GAO-05-806). Retrieved April 22, 2010, from http://www.gao.gov/cgi-bin/getrpt?GAO-05-806; Community College Open Textbook Collaborative. (2009). Business reviews. Retrieved April 22, 2010, from http://www.collegeopentextbooks.org/reviews/ business.html; Personal interviews with Jeff Shelstad and Eric Frank.

Discussion Questions

1. Which competitive advantages do open textbooks seem to possess?

2. Which learning styles might be most effective for individuals in entrepreneurial firms? Explain your answer.

3. How might the extensive textbook industry experience that open textbook founders possess help or hinder the company’s ultimate success or failure?

4. If you were one of the founders, how would you prioritize how you spent your time in the first weeks on the job after getting the venture capital funding?

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1.2 Understanding Organizational Behavior

Learning Objectives

1. Learn about the layout of this book.

2. Understand what organizational behavior is.

3. Understand why organizational behavior matters.

4. Learn about OB Toolboxes in this book.

About This BookAbout This Book

The people make the place.

Benjamin Schneider, Fellow of the Academy of Management

This book is all about people, especially people at work. As evidenced in the opening case, we will share many examples of people making their workplaces work. People can make work an exciting, fun, and productive place to be, or they can make it a routine, boring, and ineffective place where everyone dreads to go. Steve Jobs, cofounder, chairman, and CEO of Apple Inc. attributes the innovations at Apple, which include the iPod, Mac- Book, and iPhone, to people, noting, “Innovation has nothing to do with how many R&D dollars you have.…It’s not about money. It’s about the people you have, how you’re led, and how much you get it” (Kirkpatrick, 1998). This became a sore point with investors in early 2009 when Jobs took a medical leave of absence. Many wonder if Apple will be as successful without him at the helm, and Apple stock plunged upon worries about his health (Parloff, 2008).

Figure 1.2

Steve Jobs is known for developing innovative products by hiring the right people for the job and fostering a culture of hard work and creativ-

ity.

Wikimedia Commons – CC BY 3.0.

Mary Kay Ash, founder of Mary Kay Inc., a billion-dollar cosmetics company, makes a similar point, saying,

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“People are definitely a company’s greatest asset. It doesn’t make any difference whether the product is cars or cosmetics. A company is only as good as the people it keeps”

1

Just like people, organizations come in many shapes and sizes. We understand that the career path you will take may include a variety of different organizations. In addition, we know that each student reading this book has a unique set of personal and work-related experiences, capabilities, and career goals. On average, a person working in the United States will change jobs 10 times in 20 years (U.S. Bureau of Labor Statistics, 2005). In order to suc- ceed in this type of career situation, individuals need to be armed with the tools necessary to be lifelong learners. So, this book will not be about giving you all the answers to every situation you may encounter when you start your first job or as you continue up the career ladder. Instead, this book will give you the vocabulary, framework, and critical thinking skills necessary for you to diagnose situations, ask tough questions, evaluate the answers you receive, and act in an effective and ethical manner regardless of situational characteristics.

Throughout this book, when we refer to organizations, we will include examples that may apply to diverse orga- nizations such as publicly held, for-profit organizations like Google and American Airlines, privately owned busi- nesses such as S. C. Johnson & Son Inc. (makers of Windex glass cleaner) and Mars Inc. (makers of Snickers and M&Ms), and not-for-profit organizations such as the Sierra Club or Mercy Corps, and nongovernmental orga- nizations (NGOs) such as Doctors Without Borders and the International Red Cross. We will also refer to both small and large corporations. You will see examples from Fortune 500 organizations such as Intel Corporation or Home Depot Inc., as well as small start-up organizations. Keep in mind that some of the small organizations of today may become large organizations in the future. For example, in 1998, eBay Inc. had only 29 employees and $47.4 million in income, but by 2008 they had grown to 11,000 employees and over $7 billion in revenue (Gibson, 2008). Regardless of the size or type of organization you may work for, people are the common denominator of how work is accomplished within organizations.

Together, we will examine people at work both as individuals and within work groups and how they impact and are impacted by the organizations where they work. Before we can understand these three levels of organizational behavior, we need to agree on a definition of organizational behavior.

What Is Organizational Behavior?What Is Organizational Behavior?

Organizational behavior (OB) is defined as the systematic study and application of knowledge about how individ- uals and groups act within the organizations where they work. As you will see throughout this book, definitions are important. They are important because they tell us what something is as well as what it is not. For example, we will not be addressing childhood development in this course—that concept is often covered in psychology—but we might draw on research about twins raised apart to understand whether job attitudes are affected by genetics.

OB draws from other disciplines to create a unique field. As you read this book, you will most likely recognize OB’s roots in other disciplines. For example, when we review topics such as personality and motivation, we will again review studies from the field of psychology. The topic of team processes relies heavily on the field of soci- ology. In the chapter relating to decision making, you will come across the influence of economics. When we

1. Retrieved June 4, 2008, from http://www.litera.co.uk/t/NDk1MDA/.

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study power and influence in organizations, we borrow heavily from political sciences. Even medical science con- tributes to the field of organizational behavior, particularly to the study of stress and its effects on individuals.

Figure 1.3

OB spans topics related from the individual to the organization.

Those who study organizational behavior—which now includes you—are interested in several outcomes such as work attitudes (e.g., job satisfaction and organizational commitment) as well as job performance (e.g., customer service and counterproductive work behaviors). A distinction is made in OB regarding which level of the organi- zation is being studied at any given time. There are three key levels of analysis in OB. They are examining the individual, the group, and the organization. For example, if I want to understand my boss’s personality, I would be examining the individual level of analysis. If we want to know about how my manager’s personality affects my team, I am examining things at the team level. But, if I want to understand how my organization’s culture affects my boss’s behavior, I would be interested in the organizational level of analysis.

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Why Organizational Behavior MattersWhy Organizational Behavior Matters

OB matters at three critical levels. It matters because it is all about things you care about. OB can help you become a more engaged organizational member. Getting along with others, getting a great job, lowering your stress level, making more effective decisions, and working effectively within a team…these are all great things, and OB addresses them!

It matters because employers care about OB. A recent survey by the National Association of Colleges and Employers (NACE) asked employers which skills are the most important for them when evaluating job candi- dates, and OB topics topped the list (NACE 2007 Job Outlook Survey, 2008).

The following were the top five personal qualities/skills:

1. Communication skills (verbal and written)

2. Honesty/integrity

3. Interpersonal skills (relates well to others)

4. Motivation/initiative

5. Strong work ethic

These are all things we will cover in OB.

Finally, it matters because organizations care about OB. The best companies in the world understand that the people make the place. How do we know this? Well, we know that organizations that value their employees are more profitable than those that do not (Huselid, 1995; Pfeffer, 1998; Pfeffer & Veiga, 1999; Welbourne & Andrews, 1996). Research shows that successful organizations have a number of things in common, such as pro- viding employment security, engaging in selective hiring, utilizing self-managed teams, being decentralized, pay- ing well, training employees, reducing status differences, and sharing information (Pfeffer & Veiga, 1999). For example, every Whole Foods store has an open compensation policy in which salaries (including bonuses) are listed for all employees. There is also a salary cap that limits the maximum cash compensation paid to anyone in the organization, such as a CEO, in a given year to 19 times the companywide annual average salary of all full-time employees. What this means is that if the average employee makes $30,000 per year, the highest poten- tial pay for their CEO would be $570,000, which is a lot of money but pales in comparison to salaries such as Steve Jobs of Apple at $14.6 million or the highest paid CEO in 2007, Larry Ellison of Oracle, at $192.9 million (Elmer-DeWitt, 2008). Research shows that organizations that are considered healthier and more effective have strong OB characteristics throughout them such as role clarity, information sharing, and performance feedback. Unfortunately, research shows that most organizations are unhealthy, with 50% of respondents saying that their organizations do not engage in effective OB practices (Aguirre et al., 2005).

In the rest of this chapter, we will build on how you can use this book by adding tools to your OB Toolbox in each section of the book as well as assessing your own learning style. In addition, it is important to understand

the research methods used to define OB, so we will also review those. Finally, you will see what challenges and opportunities businesses are facing and how OB can help overcome these challenges.

Adding to Your OB ToolboxAdding to Your OB Toolbox

Your OB ToolboxYour OB Toolbox

OB Toolboxes appear throughout this book. They indicate a tool that you can try out today to help you develop your OB skills.

Throughout the book, you will see many OB Toolbox features. Our goal in writing this book is to create something useful for you to use now and as you progress through your career. Sometimes we will focus on tools you can use today. Other times we will focus on things you may want to think about that may help you later. As you progress, you may discover some OB tools that are particularly relevant to you while others are not as appropriate at the moment. That’s great—keep those that have value to you. You can always go back and pick up tools later on if they don’t seem applicable right now.

The important thing to keep in mind is that the more tools and skills you have, the higher the quality of your inter- actions with others will be and the more valuable you will become to organizations that compete for top talent (Michaels, Handfield-Jones, & Axelrod, 2001). It is not surprising that, on average, the greater the level of educa- tion you have, the more money you will make. In 2006, those who had a college degree made 62% more money than those who had a high school degree (U.S. Bureau of Labor Statistics). Organizations value and pay for skills as the next figure shows.

Figure 1.4

Education and training have financial payoffs as illustrated by these unemployment and earnings for work-

ers 25 and older.

Source: U.S. Bureau of Labor Statistics, http://www.bls.gov.

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Tom Peters is a management expert who talks about the concept of individuals thinking of themselves as a brand to be managed. Further, he recommends that individuals manage themselves like free agents (Peters, 1997; Peters, 2004). The following OB Toolbox includes several ideas for being effective in keeping up your skill set.

Your OB Toolbox: Skill Survival KitYour OB Toolbox: Skill Survival Kit

• Keep your skills fresh. Consider revolutionizing your portfolio of skills at least every 6 years.

• Master something. Competence in many skills is important, but excelling at something will set you apart.

• Embrace ambiguity. Many people fear the unknown. They like things to be predictable. Unfortu- nately, the only certainty in life is that things will change. Instead of running from this truth, embrace the situation as a great opportunity.

• Network. The term has been overused to the point of sounding like a cliché, but networking works. This doesn’t mean that having 200 connections on MySpace, LinkedIn, or Facebook makes you more effective than someone who has 50, but it does mean that getting to know people is a good thing in ways you can’t even imagine now.

• Appreciate new technology. This doesn’t mean you should get and use every new gadget that comes out on the market, but it does mean you need to keep up on what the new technologies are and how they may affect you and the business you are in.

Source: Adapted from ideas in Peters, T. (2007). Brand you survival kit. Fast Company. Retrieved July 1, 2008, from http://www.fastcompany.com/magazine/83/playbook.html.

A key step in building your OB skills and filling your toolbox is to learn the language of OB. Once you understand a concept, you are better able to recognize it. Once you recognize these concepts in real-world events and under- stand that you have choices in how you will react, you can better manage yourself and others. An effective tool you can start today is journaling, which helps you chart your progress as you learn new skills. For more on this, see the OB Toolbox below.

OB Toolbox: Journaling as a Developmental ToolOB Toolbox: Journaling as a Developmental Tool

• What exactly is journaling? Journaling refers to the process of writing out thoughts and emotions on a regular basis.

• Why is journaling a good idea? Journaling is an effective way to record how you are feeling from day to day. It can be a more objective way to view trends in your thoughts and emotions so you are not simply relying on your memory of past events, which can be inaccurate. Simply getting your thoughts and ideas down has been shown to have health benefits as well such as lowering the writer’s blood pressure, heart rate, and decreasing stress levels.

• How do I get started? The first step is to get a journal or create a computer file where you can add new entries on a regular basis. Set a goal for how many minutes per day you want to write and stick

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to it. Experts say at least 10 minutes a day is needed to see benefits, with 20 minutes being ideal. The quality of what you write is also important. Write your thoughts down clearly and specifically while also conveying your emotions in your writing. After you have been writing for at least a week, go back and examine what you have written. Do you see patterns in your interactions with others? Do you see things you like and things you’d like to change about yourself? If so, great! These are the things you can work on and reflect on. Over time, you will also be able to track changes in yourself, which can be motivating as well.

Sources: Created based on ideas and information in Bromley, K. (1993). Journaling: Engagements in reading, writing, and thinking. New York: Scholastic; Caruso, D., & Salovey, P. (2004). The emotionally intelligent manager: How to develop and use the four key emotional skills of leadership. San Francisco: Jossey-Bass; Scott, E. (2008). The benefits of journaling for stress management. Retrieved January 27, 2008, from About.com: http://stress.about.com/od/generaltechniques/p/profilejournal.htm.

Isn’t OB Just Common Sense?Isn’t OB Just Common Sense?

As teachers we have heard this question many times. The answer, as you might have guessed, is no—OB is not just common sense. As we noted earlier, OB is the systematic study and application of knowledge about how individ- uals and groups act within the organizations where they work. Systematic is an important word in this definition. It is easy to think we understand something if it makes sense, but research on decision making shows that this can easily lead to faulty conclusions because our memories fail us. We tend to notice certain things and ignore others, and the specific manner in which information is framed can affect the choices we make. Therefore, it is important to rule out alternative explanations one by one rather than to assume we know about human behavior just because we are humans! Go ahead and take the following quiz and see how many of the 10 questions you get right. If you miss a few, you will see that OB isn’t just common sense. If you get them all right, you are way ahead of the game!

Putting Common Sense to the TestPutting Common Sense to the Test

Please answer the following 10 questions by noting whether you believe the sentence is true or false.

1. Brainstorming in a group is more effective than brainstorming alone. _____

2. The first 5 minutes of a negotiation are just a warm-up to the actual negotiation and don’t matter much. _____

3. The best way to help someone reach their goals is to tell them to do their best. _____

4. If you pay someone to do a task they routinely enjoy, they’ll do it even more often in the future. _____

5. Pay is a major determinant of how hard someone will work. _____

6. If a person fails the first time, they try harder the next time. _____

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7. People perform better if goals are easier. _____

8. Most people within organizations make effective decisions. _____

9. Positive people are more likely to withdraw from their jobs when they are dissatisfied. _____

10. Teams with one smart person outperform teams in which everyone is average in intelligence. ______

You may check your answers with your instructor.

Key Takeaway

This book is about people at work. Organizations come in many shapes and sizes. Organizational behavior is the systematic study and application of knowledge about how individuals and groups act within the orga- nizations where they work. OB matters for your career, and successful companies tend to employ effective OB practices. The OB Toolboxes throughout this book are useful in increasing your OB skills now and in the future.

Exercises

1. Which type of organizations did you have the most experience with? How did that affect your understanding of the issues in this chapter?

2. Which skills do you think are the most important ones for being an effective employee?

3. What are the three key levels of analysis for OB?

4. Have you ever used journaling before? If so, were your experiences positive? Do you think you will use journaling as a tool in the future?

5. How do you plan on using the OB Toolboxes in this book? Creating a plan now can help to make you more effective throughout the term.

ReferencesReferences

Aguirre, D. M., Howell, L. W., Kletter, D. B., & Neilson, G. L. (2005). A global check-up: Diagnosing the health of today’s organizations (online report). Retrieved July 25, 2008, from the Booz & Company Web site: http://www.orgdna.com/downloads/GlobalCheckUp-OrgHealthNov2005.pdf.

Elmer-DeWitt, P. (2008, May 2). Top-paid CEOs: Steve Jobs drops from no. 1 to no. 120. Fortune. Retrieved July 26, 2008, from CNNMoney.com: http://apple20.blogs.fortune.cnn.com/2008/05/02/top-paid-ceos- steve-jobs- drops-from-no-1-to-no-120/.

http://www.orgdna.com/downloads/GlobalCheckUp-OrgHealthNov2005.pdf
http://apple20.blogs.fortune.cnn.com/2008/05/02/top-paid-ceos-steve-jobs-drops-from-no-1-to-no-120/
http://apple20.blogs.fortune.cnn.com/2008/05/02/top-paid-ceos-steve-jobs-drops-from-no-1-to-no-120/
Gibson, E. (2008, March). Meg Whitman’s 10th anniversary as CEO of eBay. Fast Company, 25.

Huselid, M. A. (1995). The impact of human resource management practices on turnover, productivity, and cor- porate financial performance. Academy of Management Journal, 38, 635-672.

Kirkpatrick, D. (1998). The second coming of Apple. Fortune, 138, 90.

Michaels, E., Handfield-Jones, H., & Axelrod, B. (2001). The war for talent. Boston: Harvard Business School Publishing.

NACE 2007 Job Outlook Survey. Retrieved July 26, 2008, from the National Association of Colleges and Employers (NACE) Web site: http://www.naceweb.org/press/quick.htm#qualities.

Parloff, R. (2008, January 22). Why the SEC is probing Steve Jobs. Money. Retrieved January 28, 2009, from http://money.cnn.com/2009/01/22/technology/stevejobs_disclosure.fortune/?postversion=2009012216.

Peters, T. (1997). The brand called you. Fast Company. Retrieved July 1, 2008, from http://www.fastcom- pany.com/magazine/10/brandyou.html.

Peters, T. (2004). Brand you survival kit. Fast Company. Retrieved July 1, 2008, from http://www.fastcom- pany.com/magazine/83/playbook.html.

Pfeffer, J. (1998). The human equation: Building profits by putting people first. Boston: Harvard Business School Press.

Pfeffer, J., & Veiga, J. F. (1999). Putting people first for organizational success. Academy of Management Execu- tive, 13, 37–48.

U.S. Bureau of Labor Statistics. (2005). Retrieved December 8, 2005, from the U.S. Bureau of Labor Statistics Web site: http://www.bls.gov/nls/nlsfaqs.htm#anch5.

Welbourne, T., & Andrews, A. (1996). Predicting performance of Initial Public Offering firms: Should HRM be in the equation? Academy of Management Journal, 39, 910–911.

http://www.naceweb.org/press/quick.htm#qualities
http://money.cnn.com/2009/01/22/technology/stevejobs_disclosure.fortune/?postversion=2009012216
http://www.fastcompany.com/magazine/10/brandyou.html
http://www.fastcompany.com/magazine/10/brandyou.html
http://www.fastcompany.com/magazine/83/playbook.html
http://www.fastcompany.com/magazine/83/playbook.html
http://www.bls.gov/nls/nlsfaqs.htm#anch5
1.3 Understanding Your Learning Style

Learning Objectives

1. Understand different dimensions of learning styles.

2. Diagnose your own learning style.

3. Explore strategies for working with your preferred learning style.

Learning StylesLearning Styles

In order to maximize your learning in this course and in any learning situation, it’s important to understand what type of learner you are. Some people learn better by seeing information. For example, if you notice that you retain more information by reading and seeing diagrams and flow charts, you may be a visual learner. If you primarily learn by listening to others such as in lectures, conversations, and videos, you may be an auditory learner. Finally, if you have a preference for actually doing things and learning from trial and error, you may be a kinesthetic learner. If you are unaware of what your primary learning style is, take a moment to diagnose it at the Web site listed below.

What Is Your Learning Style?What Is Your Learning Style?

Take the following online learning style quiz to find out what type of learner you are:

http://www.vark-learn.com/english/page.asp?p=questionnaire

Now that you have established which type of learner you are, let’s go through some recommendations for your style. Here are some learning recommendations.

1

• If you are a visual learner,

◦ draw pictures and diagrams to help you understand;

◦ take careful notes during class so you can refer back to them later on;

1. Adapted from recommendations by Jennifer Yeh at San Francisco State University. Retrieved June 1, 2008, from the Center for the Enhance- ment of Teaching, San Francisco State University: http://oct.sfsu.edu/introduction/learningstyles/index.html.

http://www.vark-learn.com/english/page.asp?p=questionnaire
http://oct.sfsu.edu/introduction/learningstyles/index.html
◦ summarize the main points of what you learn using charts.

• If you are an auditory learner,

◦ join study groups so you can discuss your questions and ideas and hear responses;

◦ write down any oral instructions you hear in class right away;

◦ consider taping lectures if your professor says it is OK and view online lectures on topics you are inter- ested in.

• If you are a kinesthetic learner,

◦ schedule your homework and study sessions so you can take breaks and move around between reading your notes or chapters;

◦ take good notes during class—this will force you to pay attention and process information even when you feel like you are “getting it”;

◦ don’t sign up for long once-a-week classes—they normally require too much sitting and listening time.

For various reasons, using flash cards seems to help with all three learning styles. For example, for an auditory learner, saying the answers aloud when using flash cards helps to solidify concepts. For a visual learner, seeing the answers written down on the flash card can be helpful. And for the kinesthetic learner, the act of creating and organizing flash cards helps the concepts stick.

Figure 1.5

While individuals tend to have a dominant, or primary, learning style, being able to adapt to different learn-

http://open.lib.umn.edu/organizationalbehavior/wp-content/uploads/sites/197/2016/11/1.3.0N.jpg
http://open.lib.umn.edu/organizationalbehavior/wp-content/uploads/sites/197/2016/11/1.3.0N.jpg
ing situations is a big plus, so anytime you get a chance to learn in a new way, grab it. The more you prac-

tice, the better you will become at learning to process information in different ways.

Kozminski University – Group Work – CC BY-NC-ND 2.0.

Key Takeaway

People tend to have a preferred learning style. Visual learners see things to learn them. Auditory learners hear things to learn them. Kinesthetic learners do things to learn them.

Exercises

1. Were you surprised by your primary learning style? Why or why not?

2. How does your learning style affect the kinds of classes you take?

3. Try out a few of the suggestions for your learning style over the next week and see how they work.

4. Now that you’ve learned more about your own learning style, are there some things you might consider doing to expand on your other styles? If so, what steps might you take to do this?

https://www.flickr.com/photos/kozminskiuni/8935103141/
1.4 Understanding How OB Research Is Done

Learning Objectives

1. Learn the terminology of research.

2. Understand the different types of OB research methods used.

OB Research MethodsOB Research Methods

OB researchers have many tools they use to discover how individuals, groups, and organizations behave. Researchers have working hypotheses based on their own observations, readings on the subject, and information from individuals within organizations. Based on these ideas, they set out to understand the relationships among different variables. There are a number of different research methods that researchers use, and we will discuss a few of these below. Imagine that your manager has asked you to find out if setting goals will help to make the employees at your company more productive. We will cover the different ways you could use research methods to answer this question, impress your boss, and hopefully get a promotion.

SurveysSurveys

Surveys are one of the primary methods management researchers use to learn about OB. A basic survey involves asking individuals to respond to a number of questions. The questions can be open-ended or close-ended. An example of an open-ended question that could be used to address your manager’s question would be to ask employees how they feel about goal setting in relation to productivity, then summarize your findings. This might work if you have a small organization, but open-ended surveys can be time consuming to summarize and hard to interpret at a glance. You could get more specific by asking employees a series of close-ended questions in which you supply the response key, such as a rating of 1 to 5. Today it is easy to create online surveys that quickly compile the results automatically. There are even several free survey tools available online such as http://freeon- linesurveys.com/ and http://www.surveygizmo.com/, or you can use paper-and-pencil surveys.

Figure 1.6

http://freeonlinesurveys.com/
http://freeonlinesurveys.com/
http://www.surveygizmo.com/
Researchers may even use a handheld device to randomly or systematically survey participants about key

aspects of their day to get a more dynamic view. This is called time sampling.

Department of Computer and Information Science NTNU – Researcher’s Night 2014 – CC BY-NC 2.0.

Sample Survey About the Effectiveness of Goal SettingSample Survey About the Effectiveness of Goal Setting

Instructions: We would like to gather your opinions about different aspects of work. Please answer the fol- lowing three questions using the scale below:

Response Scale:

1=Strongly disagree

2=Disagree

3=Neither agree nor disagree

4=Agree

5=Strongly agree

Setting goals at work helps me to focus 1 2 3 4 5

Goal setting is effective in improving performance 1 2 3 4 5

I get more done when I use goal setting 1 2 3 4 5

Regardless of the method you choose to collect your information, the next step is to look at the average of the responses to the questions and see how the responses stack up. But this still wouldn’t really answer the question

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https://www.flickr.com/photos/idintnu/15204362789/
your boss asked, which is whether using goal setting would help employees be more effective on the job. To do this, you would want to conduct a field study.

Field StudiesField Studies

Field studies are also effective ways to learn about what is truly going on within organizations. There are survey field studies like the one above, but more compelling evidence comes from field studies that employ an experi- mental design. Here you would assign half the employees at your company to the goal setting condition and the other half to the control group condition. The control group wouldn’t get any information on goal setting but the treatment group would. If you found that the treatment group was more effective than the control group, you could tell your boss that goal setting works.

Laboratory StudiesLaboratory Studies

OB researchers are often interested in basic research questions such as “Can we show that goal setting increases performance on a simple task?” This is how research on goal setting started, and it is also how we can establish the conditions under which it works more or less effectively. Again, to address this, researchers may conduct a lab study in which one group is assigned one condition and the other group is assigned the control condition (gener- ally the control condition involves no change at all). You may even have been involved in a lab study during your time at your university. One of the most important concepts to understand with lab studies is that they give the researcher a great deal of control over the environment they are studying but do so in a less “realistic” way, since they are not studying real employees in real work settings. For example, in a lab study, a researcher could simulate hiring and firing employees to see if firing some employees affected the goal-setting behavior of the remaining employees. While this wouldn’t be legal or ethical to do in a real organization, it could be a compelling lab study. At the same time, however, firing someone in a lab setting does not necessarily carry the same consequences as it would in real life.

Case StudiesCase Studies

Case studies are in-depth descriptions of a single industry or company. Case writers typically employ a systematic approach to gathering data and explaining an event or situation in great detail. The benefits of case studies are that they provide rich information for drawing conclusions about the circumstances and people involved in the topics studied. The downside is that it is sometimes difficult to generalize what worked in a single situation at a single organization to other situations and organizations.

Meta-AnalysisMeta-Analysis

Meta-analysis is a technique used by researchers to summarize what other researchers have found on a given topic. This analysis is based on taking observed correlations from multiple studies, weighting them by the number of observations in each study, and finding out if, overall, the effect holds or not. For example, what is the average relationship between job satisfaction and performance? Research shows that, looking across 300 studies, the rela-

tionship is moderately strong (Judge et al., 2001). This is useful information because for years people had thought that the relationship did not exist, but when all the studies to date were examined together, the original beliefs about the satisfaction–performance relationship deteriorated. The advantage of meta-analysis is that it gives a more definitive answer to a question than a single study ever could. The downside is that meta-analysis is only possible if sufficient research has been done on the topic in question.

Measurement Issues in OBMeasurement Issues in OB

Another important thing to understand is the difference between reliability and validity. Imagine you own a truck- ing company. A major component in trucking is managing the weight of different cargo. If you had a scale that gave you the same weight three times, we would say that was a very reliable scale. But, if it turns out the weights given are in kilograms instead of pounds, it would not be a valid measure if you charge for delivery by the pound.

Finally, much of management research addresses correlations between two concepts rather than actual causation. Correlation simply means that two things co-vary. For example, it would be inaccurate to assume that because 99% of the people who died this year also drank water, consuming water kills people. Yet many people claim their product caused a positive outcome when, in fact, the data do not support their claim any more than the water example. This brings up something that confuses even seasoned researchers. When you have only one observation it is called a datum. When you use the word data, it refers to multiple observations, so it is always plural.

Key Takeaway

OB researchers test hypotheses using different methods such as surveys, field studies, case studies, and meta-analyses. Reliability refers to consistency of the measurement while validity refers to the underlying truth of the measurement. It is important to recognize the difference between correlation and causation.

Exercises

1. Create a hypothesis about people at work. Now that you have one in mind, which method do you think would be most effective in helping you test your hypothesis?

2. Have you used any of the OB research methods before? If not, what can you do to become more familiar with them?

3. Give an example of a reliable measure.

4. Give an example of a valid measure.

5. How can you know if a relationship is causal or correlational?

ReferencesReferences

Judge, T. A., Thoresen, C. J., Bono, J. E., & Patton, G. K. (2001). The job satisfaction-job performance relation- ship: A qualitative and quantitative review. Psychological Bulletin, 127, 376–407.

1.5 Trends and Changes

Learning Objectives

1. Understand current challenges for OB.

2. Understand current opportunities for OB.

Challenges and OpportunitiesChallenges and Opportunities

There are many trends within the workplace and around the globe that have and will continue to affect the work- place and your career. We are sure you have noticed many of these trends simply by reading newspaper headlines. We will highlight some of these trends along with the challenges and opportunities they present for students of organizational behavior.

Ethical ChallengesEthical Challenges

Business ethics refers to applying ethical principles to situations that arise at work. It feels like it’s been one ethical scandal after the other. Enron Corp., AIG, Tyco International, WorldCom, and Halliburton Energy Services have all been examples of what can be described in terms ranging from poor judgment to outright illegal behavior. The immediate response by government has been the Sarbanes-Oxley Act, which went into effect in 2002. This act consists of 11 different requirements aimed at greater accountability, which companies must comply with in terms of financial reporting. And while there may be some benefit to businesses from complying with these rules (Wagner & Dittmar, 2006), few see this as the long-term solution to dealing with unethical behavior. The chal- lenge is to continue to think about business ethics on a day-to-day basis and institute cultures that support ethical decision making. The opportunity for organizations to be on the forefront of ethical thinking and actions is wide open. OB research finds that the most important determinant of whether a company acts ethically is not necessar- ily related to the policies and rules regarding ethical conduct but instead whether it has a culture of consistently ethical behavior and if leaders are committed to this ethical behavior (Driscoll & McKee, 2007).

OB Toolbox: Take an Ethics-at-Work AuditOB Toolbox: Take an Ethics-at-Work Audit

• Do you integrate ethics into your day-to-day decisions at work? It’s easy to think about ethics as something big that you either have or don’t have, but the reality is that ethical decisions are made or not made each and every day.

• Do you take the “front page” test when making important decisions at work? Thinking about how you would feel if the decisions you are making at work showed up on the front page of your local newspaper can help you avoid engaging in questionable behavior.

• Do you role model ethics at work? Seeing others engage in unethical behavior is the start of a slip- pery slope when it comes to ethics. Consider the decisions you are making and how they are consis- tent or inconsistent with how you would like to be seen by others.

• Do you consider if rewards are distributed ethically at work? Situations in which there are “haves” and “have nots” are breeding grounds of unethical behavior. Maintaining pay equity can help keep everyone more honest.

• Have you held a “risk brainstorm” at work? If you ask those around you if they see any situations that are challenging ethical behavior, you can uncover some seriously risky situations and avoid them.

Sources: Adapted from ideas in Callahan, D. (2004). The cheating culture: Why more Americans are doing wrong to get ahead. New York: Harcourt Books; Toffler, B. L. (2003). Five ways to jump-start your com- pany’s ethics. Fast Company. Retrieved May 4, 2008, from http://www.fastcompany.com/magazine/75/ 5ways.html; Trevino, L. K., Weaver, G. R., & Reynolds, S. J. (2006). Behavioral ethics in organizations: A review. Journal of Management, 32, 951–990.