Human Resources

What is Organizational Behavior?

What is Organizational Behavior?
Modern management is more likely to try to humanize the workplace and improve working conditions in order to improve results. Image from https://unsplash.com
Angela Miller profile
Angela Miller November 9, 2022

The modern workplace is a complex ecosystem filled with competing personalities. You'll likely find every type of employee—from quiet quitters to overachievers—among your colleagues. The field of organizational behavior explores how the work environment affects human attitudes, cognition, behavior, and organizational structure.

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Institutions of all sizes and functions can benefit from understanding employee behavior and organizational processes. The field of organizational behavior examines both; it provides a better understanding of the dynamics impacting job satisfaction, engagement, management, and organizational politics, along with the ways these factors impact job performance and employee productivity.

Mastering this subject is likely to give you a leg up on your professional compatriots and position you for success in any organization.

In this article, we’ll answer the question what is organizational behavior in more detail. We’ll cover:

  • Organizational behavior defined
  • Three levels of analysis: individual, group, and organization
  • Organizational culture
  • Change management
  • Studying organizational behavior management

Organizational behavior defined

Organizational behavior combines psychological, sociological, and anthropological concepts to describe how people behave in organizational work environments. It also explores issues at the organizational level, including culture, structure, design, and change management.

Historical foundation of organizational behavior

The onset of the Industrial Revolution effected a shift in the nature of daily work. Workplaces became more hierarchical, leading to conflict. Among the results: unionism and workplace revolutions. Organizational behavior grew from managers’ efforts to reduce contention by better understanding employee behavior and organizational structure.

According to Investopedia, the study of organizational behavior originated in the late 1920s when the Western Electric Company spearheaded a series of studies focusing on working conditions. Researchers initially set out to discover whether environmental upgrades would lead to increased productivity. This spurred a series of studies between 1924 and 1933 focusing on how work breaks, isolation, and lighting impact employee productivity.

Ultimately, the research suggested that social factors have a greater impact than physical factors; workers who feel valued by their bosses and get along with their coworkers are more productive than those provided with improved lighting and workplace design.

Employees in today’s workforce are generally more educated, skilled, and ambitious than their forebears. They also tend to be concerned with how their workplace might benefit their personal lives. Modern management is more likely to try to humanize the workplace and improve working conditions in order to improve results. The study of organizational behavior can help employees and managers make positive strides in both respects.

Organizational behavior is a discipline covering three factors of analysis: individuals, groups, and the organization. The subject includes:

  • Common biases and errors in decision-making
  • Conflict management
  • Effects of individual differences in attitudes
  • Emotional intelligence
  • Employee values
  • Ethical decision-making and leadership
  • Implications for performance and management
  • Management of a diverse workforce
  • Optimal performance of employees and teams

A deeper understanding of these topics can lead toward improvements in employee well-being, teamwork, and retention.

Benefits of studying organizational behavior

Companies are only as effective and impactful as their employees. Employee satisfaction often directly correlates to organizational success. Building and maintaining a competent, driven, and happy workforce can help increase productivity to achieve company goals. Organizational behavior is often an effective means to this end.

Consider the companies you’ve either worked for or supported as a customer. Did you always have positive, issue-free experiences? Probably not. Maybe you were put on hold for too long, had difficulty getting simple answers to your questions, or worked for an unsupportive manager.

When you study organizational behavior, you learn why some organizations are more effective than others and why some managers can bring out the best in their employees while others struggle to make a positive impact.

Learning about organizational behavior can help you understand your own behaviors, attitudes, and moral values. You can use what you learn to increase job satisfaction, lower stress levels, and improve performance.

Managers can leverage this discipline to achieve organizational goals and help their employees reach peak performance. Research shows that organizations that value their employees are more profitable than those that do not. Successful companies exhibit strong organizational behavior characteristics, including role clarity, information sharing, and job performance feedback.

Stronger operational structure

Knowing who your employees are and how they react to work culture—both in terms of their co-workers and the overall organization—enables you to place them effectively for maximum efficiency and return. Well-applied organizational behavior principles help employees feel appreciated, providing a strong incentive to contribute to an organization’s core mission. It also improves conflict resolution processes, cross-team collaboration, and employee retention

More efficient hiring practices

Understanding the needs of your organization and what sort of employees best fit those needs are essential to human resource management. Organizational behavior helps human resource management identify the correct candidate for each role.

Improved diversity

The current emphasis on diversity isn’t about meeting quotas. It’s about recognizing the value of different backgrounds, experiences, and viewpoints in creating a well-rounded organization. When management has a better understanding of its people, it can foster improved understanding among employees. This impacts employee behavior—and subsequently group behavior—leading to positive organizational change.

(Written by Marc Beschler)

Overemphasizing employee satisfaction

Taking your employees into consideration is important, but it isn’t the actual function of the organization. If you are creating a culture that is welcoming but isn’t paying professional dividends, you’ve lost the reason for organizational behavior management.

Operational stasis

Just because you’ve figured out what works today doesn’t necessarily mean that it will work tomorrow. Tactics can become habitual rather than helpful, possibly hindering progress. Persistent vigilance with regard to productive workplace culture is paramount.

Potential for manipulation

It’s one thing to use a tool incorrectly because you don’t know any better; it’s another to use it in bad faith. There is always the chance that the information gleaned through organizational behavior will be used to trick people into behaving in ways which serve a personal agenda rather than promote the core mission of the company.

(Written by Marc Beschler)

Organizational behavior is a complex and interesting topic with many potential professional benefits. The study can be applied to any situation requiring a variety of people to interact towards a common goal, which is why it offers numerous job opportunities. Below are some of the positions you may qualify for with a degree in organizational behavior on your resumé.

Training and development manager (TDM)

The job of a TDM entails conceiving, planning, and implementing programs around a company’s core mission and the skills and knowledge required to realize it. Training and development management is a broad field that can potentially benefit any organization. The median annual salary for a TDM in the U.S. is $128,080 per year.

Human resources manager (HRM)

Organizational behavior is particularly important for HRMs as it informs what kind of hire should be placed in which position or working group. HRMs assess candidates based on strengths, attitudes, professional habits, and other attributes. It is particularly useful in preventing disruption during organization-wide change. The median annual salary for an HRM in the U.S. is $111,975 per year.

Compensation and benefits manager (CBM)

CBMs monitor how employees are paid and otherwise rewarded for their work. Given the significant role that job satisfaction plays in organizational behavior, the more a CBM understands about the employees under their charge, the greater their ability to make sure that they are fairly compensated and sufficiently recognized for their contributions. The median annual salary for a CBM in the U.S. is $129,194 per year.

Project manager (PM)

A PM is the central operational figure of a production plan, from conception to realization and beyond. PMs must have detailed knowledge of the various teams under their supervision, how they operate internally, and how they interact with one another. One could say that organizational behavior is the key tool in a PM’s toolbox, as it affords them a wealth of understanding regarding the ins and outs of the entire company. This allows firmer control over operations and the ability to foresee where difficulty may arise. The median annual salary for a PM in the U.S. is $77,327 per year.

(Written by Marc Beschler)

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Organizational culture

It seems as though more and more companies are talking about their culture and values. Why? Because culture is important to not only the company but also to consumers and employees. If you’ve been on an interview lately, you may have asked about company culture or heard from a prospective employer that you’d made a good “cultural fit.” When you visit a company’s “about” page, you’ll likely find some information regarding what they consider to be their cultural values.

An organization’s culture defines the proper way to behave within the company. Organizational culture includes the expectations, practices, and values that guide and inform the actions of all team members. It’s a shared set of beliefs and values established by leaders and communicated to the greater organization.

Change management

Businesses must now evolve and adapt to the ever-changing nature of technology and innovation. Organizations that are able to quickly shift and change will gain a competitive advantage for themselves.

Change management refers to all methods aimed at preparing, supporting, and helping individuals, teams, and organizations in implementing organizational change. Successful change management occurs when organizations:

  • Define measurable goals and create plans for their achievement
  • Monitor assumptions, risks, dependencies, costs, return on investment, and cultural issues
  • Communicate effectively by informing stakeholders of the reasons for change, benefits of successful implementation, and relevant details
  • Develop impactful education and training plans for the organization
  • Align company employees to the overall strategic direction of the business
  • Oversee implementation and tweaking as required

Studying organizational behavior management

Students can learn organizational behavior management in degree programs, certificate programs, and standalone courses. Academic programs focusing on organizational behavior are offered by business schools as well as by schools of social work and psychology. The programs often take a multi-disciplinary approach, drawing from anthropology, ethnography, psychology, sociology, and leadership studies.

You can study specific topics within organizational behavior or choose broader study areas, including:

  • Dynamics of change
  • How social movements influence markets
  • Markets
  • Power of social networks
  • Relationships between organizations and their environments
  • Social systems

According to U.S. News and World Report, top colleges offering master’s degree programs with an emphasis on organizational behavior include Indiana University – Bloomington, The University of Texas at Dallas, Michigan State University, American University, and Saint Vincent College.

Organizational behavior gives people the tools that enable workplaces to thrive. If you’re wondering how to enhance organizational effectiveness, organizational behavior research is a solid pathway. Apple cofounder Steve Jobs attributed the innovations at his company 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.”

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