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, M. The impact of human resource management practices on turnover, productivity, and corporate financial performance. Academy of Management Journal , 38 , ; Pfeffer, J. The human equation: Building profits by putting people first.
Putting people first for organizational success. Academy of Management Executive , 13 , 37—48; Welbourne, T. Academy of Management Journal , 39 , — Research shows that successful organizations have a number of things in common, such as providing employment security, engaging in selective hiring, utilizing self-managed teams, being decentralized, paying well, training employees, reducing status differences, and sharing information.
Pfeffer, J. Academy of Management Executive , 13 , 37— 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. Elmer-DeWitt, P. 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. Aguirre, D.
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. 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. The important thing to keep in mind is that the more tools and skills you have, the higher the quality of your interactions with others will be and the more valuable you will become to organizations that compete for top talent.
Michaels, E. The war for talent. Boston: Harvard Business School Publishing. It is not surprising that, on average, the greater the level of education you have, the more money you will make. Organizations value and pay for skills as the next figure shows. Source: U. 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, T. The brand called you. Fast Company. Brand you survival kit. The following OB Toolbox includes several ideas for being effective in keeping up your skill set. Source: Adapted from ideas in Peters, T. 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 understand 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.
Sources: Created based on ideas and information in Bromley, K. Journaling: Engagements in reading, writing, and thinking. New York: Scholastic; Caruso, D.
The emotionally intelligent manager: How to develop and use the four key emotional skills of leadership. Organizational Behavior studies power and organizational politics. OB applies the knowledge gained from individuals, groups, and structure on behavior to make organizations work more effectively. But there is still considerable debate about the relative importance of each; motivation, leader behavior , power , interpersonal communication, group structure and processes, learning, attitude development , perception , change processes, conflict , work design, and work stress.
It can also help you achieve the following organizational and work culture goals. They tend to align better with teammates and managers who mirror their behavioral strengths.
As such, a keen grasp of organizational behavior can enable middle management to build more effective teams and communicate better with frontline employees. Leveraging insights from studying organizational behavior can help you understand whether your employees respond better to an autocratic or a supportive model of management.
This ensures that you have a firm grasp of the policies, communication channels, and incentives that will best enable your employees to perform well. One of the key benefits of organizational behavioral analysis is the creation of a suitable workplace environment for employees. As such, the study of organizational behavior is essential for businesses looking to adapt to the disruptions and challenges resulting from things like the pandemic or shifts in market forces.
Savvy businesses use data to drive decision-making around the formation of their corporate structure. By observing this trend through organizational behavioral analysis, many enterprises are adopting a flatter, more linear rather than hierarchical structure to provide employees with more freedom over how they perform their tasks or whom they collaborate with.
Such a structure recognizes the unique differences among employees and enables employees to have a greater voice and contribute to decisions that affect them, their teams, and the larger organization. It also enables business leaders to build a stronger relationship rooted in communication, trust, and transparency with their employees.
Employees want to work for organizations with a positive culture and an appealing work environment. The challenge is creating a workplace that fosters trust, open communication, and seamless collaboration while simultaneously catering to the unique needs of individual employees or certain functions. Creating a winning people strategy requires business leaders to define how they interact with and nurture the development of employees and work culture.
It is very much a relationship-focused effort, and organizational behavior is the facilitating linchpin. Business leaders can increase the value of their human capital by studying the complex nature of employees and their interrelationships with others.
The insights that such a study provides can help drive human resources reforms and strategies, particularly with recent findings showing a collapse of work-life balance due to more employees working from home. HR personnel can identify struggling groups needing more support and apply motivational tools uniquely suited to the employees to help them perform better by improving their workplace experience.
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