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Summary Organizational Behaviour Chapter 1-15

Organizational Behaviour (Erasmus Universiteit Rotterdam)

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Organizational Behaviour Ch. 1-15

Chapter 1: What is organizational behaviour?

In today’s increasingly competitive and demanding workplace, managers can’t succeed in

their technical skills alone. They also have to have good people skills. This makes the
workplace more pleasant, makes it easier to hire and keep qualified people, and makes a
good economic sense.

Managers: individuals who achieve goals through other people (administrators in not-for-
profit organizations).
Organization: a consciously coordinated social unit, composed of two or more people, that
functions on a relatively continuous basis to achieve a common goal or set of goals.

Henri Fayol wrote five management functions (today, commanding is left out):
 Planning: a process that includes defining goals, establishing strategy, and
developing plans to coordinate activities.
 Organizing: determining what tasks are to be done, who is to do them, how the tasks
are to be grouped, who reports to whom and where decisions are to be made.
 Leading: a function that includes motivating employees, directing others, selecting
the most effective communication channels and resolving conflicts.
 Controlling: monitoring activities to ensure that they are being accomplished as
planned and correcting any significant deviations.

Henry Mintzberg concluded that managers perform 10 different, highly interrelated roles – or
set of behaviours – attributable to their jobs.
 Figurehead (interpersonal): symbolic head, required to perform a number of routine
duties of a legal or social nature.
 Leader (interpersonal): responsible for the motivation/direction of employees.
 Liaison (interpersonal): maintains a network of outside contacts who provide
favours and information.
 Monitor (informational): receives a wide variety of information; serves as nerve
centre of internal and external information of the organization.
 Disseminator (informational): transmits information received from outsiders or from
other employees to members of the organization.
 Spokesperson (informational): transmits information to outsiders on organization’s
plans, policies, actions and results; serves as expert on organization’s industry.
 Entrepreneur (decisional): searches organization and its environment for
opportunities and initiates projects to bring about change.
 Disturbance handler (decisional): responsible for corrective action when
organization faces important, unexpected disturbances.
 Resource allocator (decisional): makes/approves significant organizational
decisions.
 Negotiator (decisional): responsible for representing the organization at major
negotiations.

Robert Katz has identifies three essential management skills.

 Technical skills: the ability to apply specialised knowledge or expertise.
 Human skills: the ability to work with, understand and motivate other people, both
individually and in groups.
 Conceptual skills: the mental ability to analyse and diagnose complex situations, to
rationally process and interpret information. Example: decision making.

Fred Luthans found that it is not true that the managers who are the most effective in their
jobs are also the ones who promoted the fastest. He found four managerial activities:
 Traditional management: decision making, planning and controlling.

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 Communication: exchanging routine information and processing paperwork.

 Human resource management: motivating, disciplining, managing conflict, staffing
and training.
 Networking: socialising, politicking and interacting with outsiders.
He found that among successful managers, networking made the largest relative contribution
to success, and HRM made the least. Among effective managers, communication made the
largest relative contribution to success, and networking the least.

Organizational behaviour: a field of study that investigates the impact that individuals,
groups and structure have on behaviour within organizations, for the purpose of applying
such knowledge toward improving an organization’s effectiveness.

Systematic study: looking at relationships, attempting to attribute causes and effects and
drawing conclusions based on scientific evidence.
An approach that complements systematic study is evidence-based management (EBM):
basing managerial decisions on the best available scientific evidence (managers should do
the same as doctors).
Intuition: a gut feeling not necessarily supported by research. The trick is to know when to go
with your instincts. Use evidence as much as possible to inform your intuition and experience.

OB is an applied behavioural science that is built on contributions from a number of

behavioural disciplines. The predominant areas are:
 Psychology: the science that seeks to measure, explain, and sometimes change the
behaviour of humans and other animals.
 Social psychology: an area of psychology that blends concepts from psychology
and sociology and that focuses on the influence of people on one another.
 Sociology: the study of people in relation to their social environment or culture.
 Anthropology: the study of societies to learn about human beings and their
activities.

Human beings are complex and behave differently in every situation.

Contingency variables: situational factors: variables that moderate the relationship between
two or more other variables (x leads to y only under the conditions specified in z).

OB offers solutions for today’s dynamic environment:

1. Responding to globalisation (people from different countries):
 Increased foreign assignments: a workforce with different needs, aspirations and
attitudes.
 Working with people from different cultures: different motivation factors,
communication.
 Coping with anticapitalism backlash: like Finland (a left country).
 Overseeing movement of jobs to countries with low-cost labour: balance interest and
responsibilities.
2. Managing workforce diversity: the concept that organizations are becoming more
heterogeneous in terms of gender, age, race, ethnicity, sexual orientation and inclusion of
other diverse groups (people within given countries):
 Embracing diversity: melting pot replaced by recognizing and valuing differences.
 Changing European demographics: age and gender.
 Implications: shift from treating everyone alike to recognizing differences. It can
increase creativity and innovation, and improve decision-making.
3. Increased demand  capacity added  excess supply  increased competition: reduce
costs, and improve productivity and quality.
Tom Peters claimed almost all quality improvement comes via simplification of design,
manufacturing, layout, processes and procedures. To achieve these ends, managers are
implementing programmes like quality management and process reengineering (require
extensive employee involvement).
4. Improving customer service.
5. Improving people skills.

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6. Stimulating innovation and change: the challenge for managers is to stimulate their
employee’s creativity and tolerance for change.
7. Coping with ‘temporariness’: because of change: globalisation, expanded capacity, and
advances in technology.
8. Working in networked organisations: managers need to develop new skills (online).
9. Helping employees balance work-life conflicts. A number of forces have contributed to
blurring the lines between employees’ work life and personal life:
 The creation of global organizations means their world never sleeps.
 Communication technology allows employees to do their work at home, or anywhere.
 Organisations are asking employees to put in longer hours.
 Fewer families have only a single breadwinner.
10. Creating a positive work environment. Positive organizational scholarship (or
behaviour): an area of OB research that concerns how organizations develop human
strength, foster vitality and resilience, and unlock potential. What’s good about organizations?
11. Improving ethical behaviour. Ethical dilemmas: situations in which individuals are
required to define right and wrong conduct. Should they ‘blow the whistle’ if they uncover
illegal activities? Should they follow orders with which they don’t agree? Etc.

Model: an abstraction of reality; a simplified representation of some real-world phenomenon.

Three levels of analysis in OB, whereby each level is constructed on the previous level:
individual level  group level  organization systems level.

Dependent variable: a response that is affected by an independent variable. In OB:

 Productivity: a performance measure that includes effectiveness (achievement of
goals) and efficiency (the ratio between effective output to the input required to
achieve).
 Absenteeism: the failure to report to work.
 Turnover: voluntary and involuntary permanent withdrawal from an organization,
which causes increased recruiting/selection/training costs.
 Deviant workplace behaviour (antisocial behaviour or workplace incivility):
voluntary behaviour that violates significant organizational norms and, in so doing,
threatens the well being of the organization or its members. Absenteeism and
turnover are indicators. It’s a response to dissatisfaction.
 Organizational citizenship behaviour (OBC): discretionary behaviour that is not
part of an employee’s formal job requirements, but that nevertheless promotes the
effective functioning of the organization.
 Job satisfaction: a positive feeling about one’s job resulting from an evaluation of its
characteristics. It is an attitude rather than a behaviour. It still is a dependent variable.

Independent variable: the presumed cause of some change in a dependent variable.

 Individual-level variables: people enter organizations with certain intact
characteristics that will influence their behaviour at work (age, gender, values,
attitudes, ability). There is little management can do to alter them.
 Group-level variables: not only the sum of individuals, but more complex. People
behave differently in groups than when they are alone.
 Organization system-level variables: add formal structure to previous knowledge of
individual and group behaviour. The organization’s internal culture; and the
organization’s human resource policies and practices.

Chapter 2: Foundations of individual behaviour

From management’s standpoint, the issue is knowing how rather than whether people differ in
abilities and using this to increase the likelihood that an employee will perform their job well.
Ability: an individual’s capacity to perform the various tasks in a job.
 Intellectual abilities: the capacity to do mental activities – thinking, reasoning, and
problem solving.
o Number aptitude: speedy/accurate arithmetic
o Verbal comprehension: understand what is read/heard
o Perceptual speed: quickly/accurately identify visual differences/similarities

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o Inductive reasoning: identify logical sequence in a problem and solve it

o Deductive reasoning: use logic and assess implications of an argument
o Spatial visualisation: imagine how an object looks like if changed in position
o Memory: retain and recall past experiences
 The above intelligence dimensions have positive correlations but
aren’t perfect: people differ in their abilities. But they are high enough
that there is a general/overall factor of intelligence: general mental
ability (GMA). (It still recognizes the differences/specific abilities!)
 There has been a significant rise in the use of testing intelligence.
 The correlation between intelligence and job satisfaction is 0
because smart people have it better, but also expect more.
 Physical abilities: the capacity to do tasks that demand stamina, dexterity, strength,
and similar characteristics.
o Strength factors:
 Dynamic strength: exert muscular force repeatedly/continuously
 Trunk strength: exert muscular force using trunk muscles
 Static strength: exert force against external objects
 Explosive strength: expend a maximum of energy in explosive acts
o Flexibility factors:
 Extent flexibility: move trunk/back muscles as far as possible
 Dynamic flexibility: make rapid, repeated flexing movements
o Other factors:
 Body coordination: coordinate simultaneous actions of different
parts of the body
 Balance: maintain equilibrium
 Stamina: continue maximum effort requiring prolonged effort
o There is little relationships among the above mentioned.
o Managers must ascertain the extent to which a job requires each of these
and then assure that employees have them, in order to get high performance.

Many of the dependent variables (Ch. 1) are hard to assess. What can be easily assessed
are the biographical characteristics: personal characteristics – such as age, gender, race,
and length of tenure – that are objective and easily obtained from personnel records.
 Age. Important because (1) people believe that job performance declines with
increasing age and (2) the workforce is ageing. But this is proven: (1) the older you
get, the less likely you are to quit, (2) have lower rates of avoidable absence but
higher rates of unavoidable absence, (3) the older, the more productive OR stable,
and (4) among professionals, job satisfaction and age have a positive relationship.
 Gender. There is no significant difference in job productivity. Differences are:
(1) Women prefer part-time work, flexible work schedules and telecommuting;
(2) Women show more absenteeism because of e.g. a child that is ill.
 Race: the biological heritage people use to identify themselves. Minorities are
sometimes discriminated against in job interviews, and between colleagues 
underrepresentation in management  less pay.
 Employment tenure: length of time spent with the same employer. It is a good
predictor of employee productivity since there is a positive relationship between
seniority and job productivity. It is good in explaining absence (negative), turnover
(negative), future behaviour, and job satisfaction (positive).
 Religion. This has always been a great battle.

Learning: a relatively permanent (ingrained) change in behaviour that occurs as a result of

experience. There are 3 theories that explain the process by which we acquire patterns of
behaviour:
 Classical conditioning: a type of conditioning in which an individual responds to
some stimulus that would not ordinarily produce such as response. It’s voluntary
rather than reflexive. It is passive.
o Unconditioned stimulus: something that invariably causes you to react in a
specific way (e.g. meat for dogs)
o Unconditioned response: the reaction on the unconditioned stimulus

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o Conditioned stimulus: artificial, it was originally neutral, but was paired with
the unconditioned stimulus (e.g. meat), and eventually produced a response
when presented alone (e.g. bell)
o Conditioned response: the reaction on the conditioned stimulus, e.g.
salivation because of the bell alone
 Operant conditioning: a type of conditioning in which desired voluntary behaviour
leads to a reward or prevents a punishment. Behaviour is a function of its
consequences.
o Part of Skinner’s broader concept of behaviourism: a theory which argues
that behaviour follows stimuli in a relatively unthinking manner (unawareness)
 Social-learning theory: the view that people can learn through observation and
direct experience. You watch models. It is an extension of operating conditioning: it
assumes that behaviour is a function of consequences AND it acknowledges the
existence of observational learning and the importance of perception in learning.
There are four processes to determine the influence of a model on an individual:
o Attentional processes: recognizing and paying attention
o Retention processes: how well remembered
o Motor reproduction processes: perform the modelled activities
o Reinforcement processes: positive incentives / rewards increase motivation

Shaping behaviour: systematically reinforcing each successive step that moves and
individual closer to the desires response. There are four ways to shape behaviour:
 Positive reinforcement: following a response with something pleasant, e.g. praising.
 Negative reinforcement: following a response by the termination or withdrawal of
something unpleasant, e.g. looking through notes so the teacher won’t call you.
 Punishment: causing an unpleasant condition in an attempt to eliminate an
undesirable behaviour, e.g. suspension.
 Extinction: eliminating any reinforcement that is marinating a behaviour, e.g.
ignoring raised hands for questions in order to extinct them.
Reinforcement is more effective than punishment because punishment is temporary and can
have unpleasant side effects. Also, the recipient becomes resentful of the punisher.

Reinforcement schedules:
 Continuous reinforcement: reinforces the desired behaviour each time it is
demonstrated. Fast learning of new behaviour but rapid extinction
 Intermittent reinforcement: not each instance of a desirable behaviour is reinforced,
but reinforcement is given often enough to make the behaviour worth repeating.
o Ratio schedules: depend on how many responses the subject makes
 Fixed-ratio schedule: initiating rewards after a fixed or constant
number of responses. Example: piece-rate pay. High and stable
performance attained quickly but with rapid extinction
 Variable-ratio schedule: varying the rewards relative to the
behaviour of the individual. Example: commissioned sales. Very high
performance with slow extinction
o Interval schedules: depend on how much time has passed since the
previous reinforcement
 Fixed-interval schedule: spacing rewards at uniform time intervals
Example: salaries. Average and irregular performance with rapid
extinction
 Variable-interval schedule: distributing rewards in time so that
reinforcements are unpredictable. Example: not announcing when a
quiz will take place. Moderately high and stable performance with
slow extinction

OB Mod: the application of reinforcement concepts to individuals in the work setting.

It follows a five-step problem-solving model: (1) identify critical behaviours; (2) develop
baseline data (how many time does it occur); (3) identify behavioural consequences; (4)
develop and implement an intervention strategy; and (5) evaluate performance improvement.

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One problem with behaviourism is that thoughts and feelings immediately follow
environmental stimuli, even those explicitly meant to shape behaviour. People weigh the
value of these stimuli. This is contrary to the assumptions of behaviourism and OB Mod,
which assume that people’s innermost thoughts and feelings in response to the environment
are irrelevant. Operant conditioning and behaviourism have been superseded by other
approaches that emphasise cognitive processes.

Global implications:
 The structures and measures of intellectual abilities generalise across cultures.
 Biographical characteristics vary across cultures, but it is not known whether the
relationships described above vary or generalise across cultures.
 It is not known whether the theories of learning generalise across cultures.

Chapter 3: Attitudes and job satisfaction

Attitudes: evaluative statements or judgments concerning objects, people or events. They

reflect how we feel about something. They have three components:
 Cognitive component: the opinion or belief segment of an attitude. It’s a description.
Example: My pay is low.
 Affective component: the emotional or feeling segment of an attitude. Example: I
am angry over how little I’m paid.
 Behavioral component: an intention to behave in a certain way toward someone or
something. Example: I’m going to look for another job that pays better.
These components are closely related and in reality they are very difficult to separate.

It is always believed that attitudes cause behavior, but attitudes can also follow behavior.
 Cognitive dissonance: any incompatibility between two or more attitudes or between
behavior and attitudes.

Festinger argued that any form of inconsistency is uncomfortable and that individuals will
attempt to reduce the dissonance and, hence, the discomfort. This is done by altering either
the attitudes or the behavior or by developing a rationalization for the discrepancy.

He proposed that the desire to reduce the dissonance depends on the importance of the
elements creating it and the degree of influence the individual believes he has over the
elements. A third factor is the rewards of dissonance; high rewards accompanying high
dissonance tend to reduce the tension inherent in the dissonance.

The most powerful moderators in attitudes-behavior relationships: the importance of the

attitude; its correspondence to behavior; its accessibility (attitudes easily remembered); social
pressures; direct personal experience.

Some work-related attitudes:

 Job satisfaction: a positive feeling about one’s job resulting from an evaluation of its
characteristics. Also called: ‘employee attitudes’.
 Job involvement: the degree to which a person identifies with a job, actively
participates in it and considers performance important to self-worth.
o Psychological empowerment: employees’ belief in the degree to which they
affect their work environment, their competence, the meaningfulness of their
job and their perceived autonomy in their work.
 Organizational commitment: the degree to which an employee identifies with a
particular organization and its goals and wished to maintain membership in it (it can
be replaced occupational commitment as this is more relevant nowadays).
o Affective commitment: an emotional attachment to an organization and a
belief in its values (most related to organizational outcomes like performance)
o Continuance commitment: the perceived economic value of remaining with
an organization compared to leaving it (paid well) (not so strong)
o Normative commitment: an obligation to remain with an organization for
moral or ethical reasons

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 Perceived organizational support (POS): the degree to which employees believe

an organization values their contribution and cares about their well-being.
 Employee engagement: an individual’s involvement and satisfaction with, and
enthusiasm for, the work he or she does (= relatively new, may capture the above).
These attitudes are highly related, perhaps to a troubling degree because they might become
redundant: this might be inefficient and confusing.

Job satisfaction seems very broad, but an employee’s assessment of how satisfied they are
with the job is a complex summation of a number of discrete job elements. To measure it:
 Single global rating: a response to one question: ‘All things considered, how
satisfied are you with your job?’
 Summation score made up of number of job facets: identifies key elements in a job.
Both approaches work evenly well.

Overall, people are quite satisfied with their jobs. But, there has been a decline in levels of
reported job satisfaction. Also, satisfaction levels vary a lot depending on the job facets.

Enjoying the work is almost always the most strongly correlated with high levels of overall
job satisfaction. Most people prefer challenging and stimulating work. The amount of pay is
also related to job satisfaction, especially in countries where wages are lower. However, once
an individual reaches a level of comfortable living, the relationship virtually disappears.

Job satisfaction is not just about job conditions. Personality also plays a role.
 Core self-evaluations: bottom-line conclusions individuals have about their capabilities,
competence and worth as a person. It has a positive relationship with job satisfaction.

Helpful in understanding the consequences of dissatisfaction is a theoretical model: the exit-

voice-loyalty-neglect framework.

EXIT: dissatisfaction Active VOICE: dissatisfaction

expressed through behavior expressed through active
directed toward leaving the and constructive attempts to
organization improve conditions
Destructive Constructive
NEGLECT: dissatisfaction LOYALY: dissatisfaction
expressed through allowing expressed passively waiting
conditions to worsen (like for conditions to improve
absenteeism) Passive (like trusting management)

This model is quite general. More specific outcomes of job satisfaction/dissatisfaction are:
 Job satisfaction and job performance: high correlation for individual & organization.
 Job satisfaction and organizational citizen behavior (OCB): moderate correlation,
through perceptions of fairness, which develops trust.
 Job satisfaction and customer satisfaction: high correlation. Also applies in reverse.
 Job satisfaction and absenteeism: moderate/weak negative relationship because of
other factors like ‘liberal sick leave benefits’ that are encouraging to take days off.
 Job satisfaction and turnover: stronger negative relationship, but again there are
other factors like length of tenure. A moderator: level of performance.
 Job satisfaction and workplace deviance: negative correlation.
Many managers are unconcerned about job satisfaction of their employees. Still others
overestimate the degree to which their employees are satisfied with their jobs.

Although job satisfaction appears to be a relevant concept across cultures, that doesn’t mean
there are no cultural differences in job satisfaction. Western cultures have higher levels of job
satisfaction that those in Eastern cultures because of much negative emotions in the East.

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Chapter 4: Personality and values

Personality: the sum of total ways in which an individual reacts and interacts with others.
Research has shown that personality tests are useful in hiring decision.
The most common means of measuring personality is through self-report surveys:
individuals evaluate themselves by rating themselves on a series of factors. Weaknesses,
however, are that respondents might lie and the accuracy.
Observer-ratings surveys provide an independent assessment of personality. These results
and of the self-report surveys are strongly related. Observer-ratings surveys might be better.

Personality is a result of both hereditary and environmental factors, but hereditary factors
are of greater importance.
Heredity: factors determined at conception, one’s biological, physiological and inherent
psychological makeup (molecular structure of genes, located in chromosomes).

Over periods of time, people’s personalities change, but the rank order does not very much.
Personal traits: enduring characteristics that describe and individual’s behavior.
There are two approaches that are dominant frameworks for identifying and classifying traits:
 The Myers-Briggs Type Indicator (MBTI): a 100-question personality test that taps
four characteristics and classifies people into 1 of 16 personality types. It is very
popular but it is questioned whether it’s valid measure. It can be a valuable tool for
increasing self-awareness and providing career guidance but it is unrelated to job
performance so managers should not use it. The characteristics are:
o Extraverted vs. introverted (outgoing/assertive vs. quiet/shy)
o Sensing vs. intuitive (routine/order/details vs. unconscious processes)
o Thinking vs. feeling (reason/logic vs. personal values/emotions)
o Judging vs. perceiving (control/ordered/structured vs. flexible/spontaneous)
 The Big Five personality model: a personality assessment model that taps five
basic dimensions. The dimensions are related to job performance.
o Extraversion: captures one’s comfort level with relationships (sociable,
gregarious, assertive)  better interpersonal, more emotionally expressive.
o Agreeableness: one’s propensity to defer to others (good-natured,
cooperative, trusting)  better liked, more compliant and conforming.
o Conscientiousness: measure of reliability (responsible, dependable,
persistent, organized)  more effort/persistence, more discipline/organized.
o Emotional stability (converse = neuroticism): one’s ability to withstand
stress (calm, self-confident, secure)  less negative thinking.
o Openness to experience: one’s range of interests/fascination with novelty
(imagination, sensitivity, curiosity)  increased learning, more creative.

Core self-evaluation: the degree to which an individual likes or dislikes himself or herself,
whether the person sees himself or herself as capable and effective, and whether the person
feels in control of his or her environment or powerless over the environment. Their job
performance is higher because they set more ambitious goals, are more committed to their
goals and persist longer at attempting to reach these goals. Some might be overconfident.

Machiavellianism: the degree to which an individual is pragmatic, maintains emotional

distance and believes that ends can justify means. Yet high-Mach outcomes are moderated
by situational factors; whether high Machs make good employees depends on type of job.

Narcissism: the tendency to be arrogant, have grandiose sense of self-importance, require

excessive admiration and have a sense of entitlement. They are often less effective.
Self-monitoring: a personality trait that measures an individual’s ability to adjust his or her
behavior to external, situational factors. They perform better.

Risk taking: impacts how long it takes / how much information they require to make
decisions. Decision accuracy is still the same for high riskers and low riskers.

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Type A personality: aggressive involvement in a chronic, incessant struggle to achieve more

and more in less and less time and, if necessary, against the opposing efforts of other things
or other people.
Type B personality: rarely harried by the desire to obtain a wildly increasing number of
things or participate in endless growing series of events in an ever-decreasing amount of
time. The opposite of Type A personality.
Type A personalities do better in job interviews.

Proactive personality: people who identify opportunities, show initiative, take action and
persevere until meaningful change occurs.

Values are often very specific and describe belief systems rather than behavioral tendencies.
Values: basic convictions that a specific mode of conduct or end-state of existence is
personally or socially preferable to an opposite or converse mode of conduct or end-state of
existence. Values have both content attributes (is it important?) and intensity attributes (how
important is it?).
Value system: a hierarchy based on a ranking of an individual’s values in terms of their
intensity. Values tend to be stable and enduring. Questioning might change it, but more often,
our questioning acts to reinforce the values we hold.

Milton Rokeach created the Rokeach Value Survey (RVS) with two sets of values:
 Terminal values: desirable end-states of existence; the goals a person would like to
achieve during their lifetime.
 Instrumental values: preferable models of behavior or means of achieving one’s
terminal values.
RVS values vary among groups. People in the same occupations or categories tend to hold
similar values, which can be a valuable aid in explaining and predicting behavior.

European Values Study (EVS)  interesting result: difference across Europe regarding
work ethos (important for job performance).

Thirty years ago, organizations were concerned only with personality (to match individuals to
specific jobs), but nowadays there is also a focus on values (if personality and values match
the organization). This is because managers today are less interested in an applicant’s ability
to perform a specific job than with the flexibility to meet changing situations and commitment
to the organization.

Personality-job fit theory (John Holland): a theory that identifies six personality types and
proposes that the fit between personality type and occupational environment determines
satisfaction and turnover. The types are:

Type Personality characteristics Congruent occupations

Realistic: prefers physical activities Shy, genuine, persistent, stable, Mechanic, drill press operator,
that require skill, strength, and conforming, practical assembly-line worker, farmer
coordination
Investigative: prefers activities that Analytical, original, curious, Biologist, economist, mathematician,
involve thinking, organizing, and independent news reporter
understanding
Social: prefers activities that involve Sociable, friendly, cooperative, Social worker, teacher, counselor,
helping and developing others understanding clinical psychologist
Conventional: prefers rule-regulated, Conforming, efficient, practical, Accountant, corporative manager, bank
orderly and unambiguous activities unimaginative, inflexible teller, file clerk
Enterprising: prefers verbal activities Self-confident, ambitious, energetic, Lawyer, real estate agent, public
in which there are opportunities to domineering relations specialist, small business
influence others and attain power manager
Artistic: prefers ambiguous and Imaginative, disorderly, idealistic, Painter, musician, writer, interior
activities that allow creative expression emotional, impractical unsystematic decorator

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John Holland developed the Vocational Preference Inventory questionnaire, which

contains 160 occupational titles. Respondents indicate which they like or dislike. Their
answers form personality profiles. The closer two fields are in the hexagon, the more
compatible they are. Adjacent categories are similar, and the opposites are highly dissimilar.

Conventional

Artistic (A)
(C)

The theory argues that satisfaction is highest and turnover is lowest when personality and
occupation are in agreement (so that a realistic person has a realistic job, and a realistic
person in a social job is least congruent, etc.).
The key points of this model are that (1) there are intrinsic differences in personality among
individuals, (2) there are different types of jobs, and (3) people in job congruent with their
personality should be more satisfied and less likely to voluntary resign.

The person-organization fit argues that people are attracted to and selected by
organizations that match their values. You could use the Big Five terminology.

The Big Five model appears in almost all cross-cultural studies. Differences tend to be in the
emphasis on dimensions and whether countries are predominantly individualistic or
collectivistic.

Values differ across cultures, and an approach for analyzing this was done by Geert
Hofstede. He found that employees vary on five value dimensions of national culture:
 Power distance: a national culture attribute that describes the extent to which a
society accepts that power in institutions and organizations is distributed unequally.
 Individualism: a national culture attribute that describes the degree to which people
prefer to act as individuals rather than as members of groups.
o Vs. Collectivism: a national culture attribute that describes a tight social
framework in which people expect others in groups of which they are part of
to look after them and protect them
 Masculinity: a national culture attribute that describes the extent to which the culture
favors traditional masculine work roles of achievement, power and control. Societal
values are characterized by assertiveness and materialism.
o Vs. Femininity: a national culture attribute that has little differentiation
between male and female roles, where women are treated as equals
 Uncertainty avoidance: a national culture attribute that describes the extent to which
a society feels threatened by uncertain and ambiguous situations and tries to avoid
them. They use laws and controls to reduce uncertainty.
o Vs. low: accept ambiguity & change, less rule oriented, and take more risks.
 Long-term orientation: a national culture attribute that emphasizes the future, thrift
and persistence.
o Vs. Short-term orientation: a national culture attribute that emphasizes the
past and present, respect for tradition and fulfillment of social obligations

There are not only national differences, but also regional differences (e.g. West & North).
Critics on Hofstede’s research: it’s old and based on one company.

The Global Leadership and Organizational Behavior Effectiveness (GLOBE): an ongoing

cross-cultural investigation of research and national culture. It has 9 dimensions. Some of
these resemble Hofstede’s dimensions. GLOBE added dimensions to Hofstede.

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Chapter 5: Perception and individual decision making

Perception: a process by which individuals organize and interpret their sensory impressions
in order to give meaning to their environment.
The world as it is perceived is the world that is behaviorally important.

A number of factors operate to shape and sometimes distort perception:

 Factors in the perceiver: attitudes, motives, interests, experience, expectations.
 Factors in the situation: time, work setting, social setting.
 Factors in the target: novelty, motion, sounds, size, background, proximity, similarity.

Person perception: the perceptions people form about each other.

Attribution theory: an attempt to determine whether an individual’s behavior is internally
(under control) or externally (forced) caused. This depends on:
 Distinctiveness: is the behavior unusual?
Yes  external, no  internal.
 Consensus: does everyone who faces a similar situation respond in the same way?
Yes  external, no  internal.
 Consistency: does the person respond the same way over time?
Yes  internal, no  external.
One of the most interesting findings from attribution theory is that errors or biases distort
attributions. We tend to overestimate internal factors and underestimate external factors when
making judgments about the behavior of others: fundamental attribution error. When you
judge yourself, you do it the other way around: self-serving bias.

There are a number of shortcuts when we judge others, which are frequently valuable: they
allow us to make accurate perceptions rapidly and provide valid data for making predictions.
However, they are not foolproof and can get us into troubles.
 Selective perception: the tendency to selectively interpret what one sees on the
basis of one’s interests, background, experience and attitudes. It can draw an
inaccurate picture because we see what we want to see.
 Halo effect: the tendency to draw a general impression about an individual on the
basis of a single characteristic (halo or horns).
 Contrast effects: evaluation of a person’s characteristics that is affected by
comparisons with other people recently encountered who rank higher or lower on the
same characteristics. You compare to the one who was before.
 Stereotyping: judging someone on the basis of one’s perception of the group to
which that person belongs. It simplifies a complex world but the problem occurs when
it happens inaccurately or too much.
o Profiling: a form of stereotyping in which a group of individuals is singled out
– typically on the basis of race or ethnicity – for intensive inquiry, scrutiny or
investigation.  “The more useful, the more danger from misuse.”

Specific applications of shortcuts in organizations:

 Employment interview: perceptual judgments that are often inaccurate, based on
our first glance.
 Performance expectations: people attempt to validate their perceptions of reality,
even when those perceptions are faulty.
o Self-fulfilling prophecy (Pygmalion effect): a situation in which a person
inaccurately perceives a second person, and the resulting expectations
cause the second person to behave in ways consistent with the original
perception
 Performance evaluation: they are very much dependent on the perceptual process.
Although the appraisal can be objective, many jobs are evaluated in subjective terms
and this is problematic because of the errors (selective perception, halo effects, etc.).
o Individual decision-making is an important part of OB. How individuals in
organizations make decisions and the quality of their final choices are largely
influenced by their perceptions. It has a large bearing on the final outcome

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o Decision-making occurs as a reaction to a problem: a discrepancy between

the current state of affairs and some desired state. But one person’s problem
is another person’s satisfactory state of affairs

Rational: characterized by making consistent, value-maximizing choices within specified

constraints. Such decisions follow a six-step rational decision-making model: describes
how individuals should behave in order to maximize outcome.

Most decisions don’t follow this model. The limited information-processing capability of human
beings makes it impossible to assimilate and understand all the information necessary to
optimize  people satisfice: they seek solutions that are satisfactory and sufficient.
 Bounded rationality: a process by making decisions by constructing simplified models
that extract the essential features from problems without capturing all their complexity.

Intuitive decision-making: an unconscious process created out of distilled experience. It

usually engages the emotions. This is perhaps the least rational way but that does not make it
wrong. The two can complement each other.

Common biases and errors in decision-making:

 Overconfidence bias: people tend to overestimate themselves. Individuals whose
intellectual and interpersonal abilities are weakest are most likely to overestimate
their performance and ability.
 Anchoring bias: a tendency to fixate on initial information, from which one then fails
to adequately adjust for subsequent information. Our mind gives a disproportionate
amount of emphasis to the first information it receives.
 Confirmation bias: the tendency to seek out information that reaffirms past choices
and to discount information that contradicts past judgments. We selectively gather it.
 Availability bias: the tendency for people to base their judgments on information that
is readily available to them. Example: more people fear flying than driving a car
because the media gives much more attention to air accidents.
 Escalation of commitment: an increased commitment to a previous decision in spite
of negative information. Especially when they view themselves as responsible for the
failure, so they won’t have to admit that they were wrong.
 Randomness error: the tendency of individuals to believe that they can predict the
outcome of random events (superstitions).
 Winner’s curse: a decision-making dictum, which argues that the winning
participants in an auction typically pay too much for the winning item.
 Hindsight bias: the tendency to believe falsely, after an outcome of an event is
actually known, that one would have accurately predicted that outcome. It reduces
our ability to learn from the past because you will overestimate your predictions.

Individual differences also create deviations from the rational model:

 Personality differences: consciousness (achievement striking  escalation of
commitment; and dutifulness  no escalation of commitment) and self-esteem
(susceptible to self-serving bias to maintain self-esteem and blame others).
 Gender: rumination (reflecting at length; overthinking problems): women>men.

Organizational constraints also create deviations from the rational model:

 Performance evaluation: managers are strongly influenced in their decision-making
by the criteria on which they are evaluated.
 Reward systems: influences decision makers by suggesting to them what choices
are preferable in terms of personal payoff.
 Formal regulations: many rules and policies limit the decision maker’s choices.
 System-imposed time constraints: deadlines on decisions which create time
pressure and make it hard to gather all the information they might like to have.
 Historical precedents: commitments that have already been made constrain current
options.

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Three different ways to frame decisions ethically:

 Utilitarianism: a system in which decisions are made to provide the greatest good
for the greatest number. This view dominates business decision-making.
o Advantage: promotes efficiency and productivity, disadvantage: ignoring
rights of individuals (minorities)
 Rights: make decisions consistent with fundamental liberties and privileges.
o Protects whistle-blowers: individuals who report unethical practices by their
employer to outsiders
o Advantage: protection from injury, disadvantage: can hinder productivity and
efficiency because of overly legalistic work environment
 Justice: impose and enforce rules fairly and impartially so that there is en equitable
distribution of benefits and costs.
o Advantage: protects minorities, disadvantage: encourage sense of
entitlement that reduces risk taking, innovation, and productivity
Critics say utilitarianism is overemphasized and that rights and justice should play a bigger
role for ethical standards.

A rational decision maker also needs creativity: the ability to produce novel and useful ideas.
This allows the decision maker to more fully appraise and understand the problem.
Most people have a creative potential they can use when confronted with a decision-making
problem. But they have to get out of the psychological ruts many of us fall into and learn how
to think about a problem in divergent ways.
Three-component model of creativity: the proposition that individual creativity requires
expertise (knowledge), creative thinking skills and intrinsic task motivation (turns creativity
potential into actual creative ideas; engagement).

Being around others who are creative actually make us more inspired. Furthermore the
effective use of analogies allows decision makers to apply an idea from one context to
another. Seeing problems in a new way also develops creative skills.

What managers can do to improve their decision-making:

 Analyze the situation (e.g. another culture).
 Be aware of biases and minimize their impact.
 Combine rational analysis with intuition.
 Enhance your creativity.

Global implications:
 There are cultural differences in the attributions people make.
 Culture doesn’t matter to decision-making, but the cultural background of a decision
maker can influence the selection of problems, depth of analysis, the importance
placed on logic and rationality, if decisions should be made individually or collectively,
and the time orientation.
 What is regarded as an ethical decision differs across cultures.

Chapter 6: Motivation concepts

Motivation: the processes that account for an individual’s intensity (how hard a person tries),
direction (that benefits that organization) and persistence (how long a person can maintain) of
effort toward attaining a goal. It clearly seems to be an issue.

Abraham Maslow’s hierarchy of needs theory: a hierarchy of 5 needs in which, as each

need is substantially satisfied, the next need becomes dominant. The needs are:
1. Physiological: hunger, thirst, shelter, sex & other bodily needs (at the bottom of Δ).
2. Safety: security and protection from physical and emotional harm.
3. Social: affection, belongingness, acceptance and friendship.
4. Esteem: internal factors like self-respect, autonomy and achievement, and external
factors like status, recognition and attention.
5. Self-actualization: drive to become what one is capable of becoming; includes
growth, achieving one’s potential en self-fulfillment (at the top of Δ).

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A substantially satisfied need no longer motivates, so you need to understand what level of
hierarchy that person is currently on and focus on satisfying the needs at or above that level.
Lower-order needs: satisfied externally (physiological and safety needs).
Higher-order needs: satisfied internally (social, esteem, and self-actualization needs).
Research, however, does not validate the theory, even though it’s a popular theory.

Clayton Alderfer attempted to rework Maslow’s need hierarchy to align it more closely with
empirical research called the ERG theory: a theory that posits three groups of core needs:
existence (physiological & safety), relatedness (social & status) and growth (esteem & self-
actualization). Alderfer didn’t assume the needs to be in a rigid hierarchy but you could be
focusing on all three needs categories simultaneously. Research has been more supportive
of his theory.

Douglas McGregor:
 Theory X: the assumption that employees dislike work, are lazy, dislike responsibility
and must be coerced to perform.
 Theory Y: the assumption that employees like work, are creative, seek responsibility
and can exercise self-direction.
To understand the theories, think in terms of Maslow’s hierarchy: Theory Y assumes that
high-order needs dominate individuals. McGregor believed more in Theory Y but it’s not
proven and empirical support for both theories is lacking.

Herzberg’s Two-factor theory (motivation-hygiene theory): a theory that relates intrinsic

factors to job satisfaction and associates extrinsic factors with dissatisfaction.
 Satisfaction is not the opposite of dissatisfaction: removing dissatisfying characteristics
from a job does not necessarily make the job satisfying.
 Hygiene factors: external factors/working conditions (pay, company policies,
physical working conditions, relations with others, job security, quality of supervision).
o When adequate: neither dissatisfied nor satisfied.
 Motivation factors: internal factors (promotional opportunities, opportunities for
personal growth, recognition, responsibility, and achievement).
Criticisms of the theory: limited procedure by its methodology; reliability is questioned; no
overall measure of satisfaction was utilized; and he assumed a relationship between
satisfaction and productivity while he only looked at satisfaction.

The two-factor theory, the need hierarchy and Theory X/Theory Y are liked but not accepted.

McClelland’s theory of needs: a theory which states three needs help explain motivation:
 Need for achievement (nAch): the drive to excel, to achieve in relationship to a set
of standards to strive to succeed.
 Need for power (nPow): the need to make others behave in a way in which they
would not have behaved otherwise.
 Need for affiliation (nAff): the desire for friendly, close interpersonal relationships.
NAch got most attention: high achievers perform best when they rate their chances 50-50.
There is a relationship between nAch, nPow, and nAff and job performance. High nAch does
not necessarily make good managers, but nPow and nAff do.
This theory has the best research support compared to the others but it has less practical
effect: the three needs are namely subconscious (unaware), so measuring them is hard.

Contemporary theories: represent the current state of thinking in explaining employee

motivation. These are:
 Cognitive evaluation theory: a theory which states that allocating extrinsic rewards
for behavior that had been previously intrinsically rewarding tends to decrease the
overall level of motivation (because of a loss of control over own behavior, and
because of a different explanation for why that person works there).
o Make an individual’s pay noncontingent on performance in order to avoid
decreasing intrinsic motivation
o BUT: extrinsic verbal rewards increase intrinsic motivation, whereas extrinsic
tangible rewards undermine it

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o Recent outgrowth: self-concordance: the degree to which a person’s

reasons for pursuing a goal is consistent with the person’s interests and core
values. If high  people are more satisfied with their jobs
 Goal-setting theory: a theory which says that specific and difficult goals, with
feedback (guide behavior), lead to higher performance.
o Three other factors in addition to feedback: goal commitment; task
characteristics; and national culture
o Management by objectives (MBO): a program that encompasses specific
goals, participatively (different from goal-setting theory) set, for an explicit
time period, with feedback on goal progress. Goals are tangible, verifiable,
and measurable
 Self-efficacy theory (social cognitive theory): an individual’s belief that they are
capable of performing a task. High  increases your effort and acceptance criticism.
o Complements goal-setting theory
o Four ways to increase self-efficacy:
 Enactive mastery: gaining relevant experience with the task/job
 Vicarious modeling: becoming more confident because you see
others doing the task
 Verbal persuasion: becoming more confident because someone
convinces you that you have the necessary skills
Best way: Pygmalion effect / Galatea effect: self-fulfilling prophecy.
 Arousal: leads to an energized state, which drives a person to
complete a task
o Note that intelligence and personality are absent on the list
 Reinforcement theory: a theory which says that behavior is a function of its
consequences. It is environmentally caused. Reinforcers control behavior – any
consequences that, when immediately following responses, increase the probability
that the behavior will be repeated. It ignores the inner state so it is not a theory of
motivation; it only looks at what controls behavior.
 Equity theory: a theory which says that individuals compare their job inputs and
outcomes with those of others and then respond to eliminate any inequities. There
are four referent comparisons that an employee can use:
o Self-inside: an employee’s experiences in a different position inside the
employee’s current organization
o Self-outside: an employee’s experiences in a situation or position outside
the employee’s current organization
o Other-inside: another individual or group of individuals inside the employee’s
organization
o Other-outside: another individual or group of individuals outside the
employee’s organization
When employees perceive inequity, they can be predicted to make one of six
choices:
o Change their inputs (e.g. exert less effort).
o Change their outcomes (e.g. on piece-rate: higher quantity to increase pay)
o Distort perception of self (e.g. I work harder than I thought I did)
o Distort perception of others (e.g. His job is not as desirable as I thought)
o Choose different referent (e.g. I may not make as much as him, but I do
make much than the other)
o Leave the field (e.g. quit)
The theory establishes the following propositions relating to inequitable pay:
o Overrewarded employees will produce more than will equitably paid
employees (payment by time)
o Overrewarded employees will produce fewer, but higher-quality, units than
will equitably paid employees (payment by quantity of production)
o Underrewarded employees will produce less/poorer quality of output
(payment by time)
o Underrewarded employees will produce a large number of low-quality units
than will equitably paid employees (payment by quantity of production)
Criticism on the theory: not all people are equity sensitive; people seek for equity in
the distribution on other organizational rewards; and historically it was distributive

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justice: perceived fairness on the amount and allocation of rewards among

individuals. Nowadays it’s organizational justice: an overall perception of what is
fair in the workplace, composed of distributive, procedural and interactional justice.
o Distributive justice: see above
o Procedural justice: perceived fairness of the process used to determine the
distribution of rewards (explanations; consistent; unbiased; accurate)
o Interactional justice: the perceived degree to which an individual is treated
with dignity, concern and respect.
What managers should do: recognize employees’ sensitivity to unfairness in
procedures; openly share allocation decisions; be consistent/unbiased; focus on the
source of the problem.
 Expectancy theory: a theory which says that the strength of a tendency to act in a
certain way depends on the strength of an expectation that the act will be follow by a
given outcome and on the attractiveness of that outcome to the individual. Three
relationships are:
o Effort-performance relationship: the probability perceived by the individual
that exerting a given amount of effort will lead to performance
o Performance-reward relationship: the degree to which the individual
believes that performing at a particular level will lead to the attainment of a
desired outcome
o Rewards-personal goals relationship: the degree to which organizational
rewards satisfy an individual’s personal goals/needs and the attractiveness of
those potential rewards for the individual
It explains why many workers aren’t motivated: their skill level may be deficient;
rewards are also given for other reasons than performance; distribution of rewards is
limited.

See figure 6.10 on page p. 161 for the relationship between all the theories!

Global implications
 Some theories don’t apply and others do across cultures.
 Maslow’s needs hierarchy: the levels can differ in their order across cultures.
 The achievement need is more applicable to Anglo-American countries.
 Equity theory does not count for all cultures (collectivist cultures).
 The desire for interesting work applies to almost everyone.

Chapter 7: Motivation: from concepts to applications

Managers should be sensitive to individual differences.

Job design: the way the elements in a job are organized. It can increase/decrease effort.
The job characteristics model (JCM): proposes that any job can be described in terms of
five job dimensions:
 Skill variety: the degree to which a job requires a variety of different activities.
o  Experienced meaningfulness of the work
 Task identity: the degree to which a job requires completion of a whole and
identifiable piece of work.
o  Experienced meaningfulness of the work
 Task significance: the degree to which a job has a substantial impact on the lives or
work of other people.
o  Experienced meaningfulness of the work
 Autonomy: the degree to which a job provides substantial freedom and discretion to
the individual in scheduling work and in determining the procedures to be used in
carrying it out.
o  Experienced responsibility for outcomes of the work
 Feedback: the degree to which carrying out the work activities required by a job
results in the individual obtaining direct and clear information about the effectiveness
of their performance.
o  Knowledge of the actual results of the work activities

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All five dimensions lead to: (1) high internal work motivation, (2) high-quality work
performance, (3) high satisfaction with the work, and (4) low absenteeism and turnover.
Furthermore, the model is moderated by the employee’s growth-need strength.
The dimensions can be combined into a predictive index, which suggests the motivating
potential in a job, called the motivating potential score (MPS).
 MPS = (Skill variety + Task identity + Task significance) / 3 * Autonomy * Feedback

How jobs can be redesigned:

 Job rotation (cross-training): periodic shifting employees from one task to another.
 Job enlargement: the horizontal expansion of jobs, which increases the number and
variety of tasks that an individual performs, and results in more diversity.
 Job enrichment: the vertical expansion of jobs, which increases the degree to which
the worker controls planning, execution, and the evaluation of the work.

Alternative work arrangements (to make the work environment more motivating):
 Flexitime: flexible work hours. Specific number of hours but free to vary them within
limits. However, there’s a common core period. It’s not applicable for every job.
 Job sharing: an arrangement that allows two or more individuals to split a traditional
40-hour-a-week job. It allows drawing on talents of more than one individual.
 Teleworking: people who work mainly in their own home or mainly in different places
using home as a base, who use a telephone/computer to carry out their work.

Success on a job is facilitated/hindered by the existence/absence of support resources.

Performance = f(A * M * O), where A = ability, M = motivation, and O = opportunity.

Employee involvement: a participative process that uses the input of employees and is
intended to increase employee commitment to an organization’s success. Three forms are:
 Participative management: a process in which subordinates share a significant
degree of decision-making power with their immediate superiors.
 Representative participation: a system in which workers participate in
organizational decision-making through a small group of representative employees.
o Work councils: group of nominated/elected employees who must be
consulted when management makes decisions involving personnel
o Board representatives: employees who sit on a company’s board of
directors and represent the interests of the firm’s employees
 Quality circles: work group of employees who meet regularly to discuss their quality
problems, investigate causes, recommend solutions and take corrective actions.

Theory Y is consistent with participative management, and Theory X aligns with the more
traditional autocratic style of managing. The two-factor theory aligns with aligns with providing
intrinsic motivation by increasing opportunities for growth, responsibility, and involvement.
Also, employee involvement is compatible with ERG theory (nAch).

Pay is important for keeping talent, so you need to know how to pay employees. There are
four major strategic rewards decisions that need to be made:
 What to pay: establishing a pay structure. Trade-offs need to be made.
o Internal equity: the worth of the job to the organization
o External equity: the competitiveness of an organization’s pay relative to pay
elsewhere in its industry
 How to pay: rewarding through a variable-pay program: a pay plan that bases a
portion of an employee’s pay on some individual and/or organizational measure of
performance. These plans do increase motivation/productivity. Different types are:
o Piece-rate pay: a pay plan in which workers are paid a fixed sum for each
unit of production completed
o Merit-based pay: a pay plan based on performance appraisal ratings.
o Bonuses: a pay plan that rewards employees for recent performance rather
than historical performance
o Skill-based pay (competency-based or knowledge-based pay): a play
plan that sets pay levels on the basis of how many skills employees have or
how many jobs they can do

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o Profit-sharing plans: an organization-wide program that distributes

compensation based on some established formula designed around a
company’s profitability
o Gainsharing: a formula-based group incentive plan. Improvements in group
productivity from one period to another determine the total amount of money
that is to be allocated
o Employee stock ownership plan (ESOP): a company-established benefits
plan in which employees acquire stock, often at below-market prices, as part
of their benefits
 Flexible benefits: a benefits plan that allows each employee to put together a
benefits package individually tailored to his or her own needs and situation.
o Modular plans: predesigned packages of benefits, with each module put
together to meet the needs of a specific group of employees
o Core-plus plans: consist of a core of essential benefits and a menu-like
selection of other benefit options from which employees can select and add
o Flexible spending plans: allow employees to set aside up to the euro
amount offered in the plan to pay for particular services, like health care
 Intrinsic rewards: employee recognition programs: spontaneous and private or
widely publicized formal programs in which specific types of behavior are encouraged
and the procedures for attaining recognition are clearly identified.

Global implications:
 The results of the job characteristics model vary by culture.
 Teleworking is high in the Netherlands and in Scandinavia, but also in the US.
 There is not much research on variable pay.
 Flexible benefits are very popular in the US and in the UK.
 Employee involvement programs differ among countries.

Chapter 8: Emotion and moods

There can be two reasons for the fact that OB has paid little/no attention to emotions:
 The myth of rationality: emotion free organizations.
 The belief that emotions of any kind are disruptive.

Affect: broad range of feelings people experience. An umbrella concept that encompasses:
 Emotions: intense feelings that are directed at someone or something.
 Moods: feelings that are less intense than emotions, lacking contextual stimulus.
Most experts believe that emotions are more fleeting than moods. Emotions are reactions to a
person or event. Moods are not directed at a person or an event. Emotions can turn into
moods, and positive or negative moods make you more emotional in response to an event.

There has never been a set of basic emotions, and there will probably never be one.

One way to classify emotions is by whether they are positive or negative (being neural ≠
emotion!) They then become mood states because we are looking at them more generally.
 Positive affect: a mood dimension that consists of specific positive emotions.
 Negative affect: a mood dimension that consists of specific negative emotions.
Positive affect and negative affect are moods. They color our perceptions.

High Negative Affect High Positive Affect

Low Positive Affect Low Negative Affect

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Positively offset: the tendency of most individuals to experience a mildly positive mood at
zero input (when nothing in particular is going on).

Emotions are critical to rational thinking. We must have the ability to experience emotions to
be rational, because our emotions provide important information about how we understand
the world around us.
Evolutionary psychology: an area of inquiry which argues that we must experience the
emotions we do because they serve a purpose. There is criticism on it.

Some of the primary influences on moods and emotions:

 Personality. People differ in affect intensity: individual differences in the strength
with which individuals experience their emotions.
 Day of the week and time of the day. People are in the best moods on the
weekends. Furthermore, positive mood peaks during the middle part of the day, and
negative moods show very little variation over the day.
 Weather has little effect on mood. Illusory correlation: the tendency of people to
associate two events when in reality there is no connection.
 Stress. The effects of stress build over time. It causes more negative emotions.
 Social activities. They cause good moods but good moods also result in more social
activities.
 Sleep does affect mood positively if you sleep much.
 Exercise does affect mood positively.
 Age. As age increases, negative emotions seem to occur less.
 Gender. Women show more emotions but because they have been taught so, and
men vice versa.

Emotional labor: a situation in which an employee expresses organizationally desired

emotions during interpersonal transactions at work.
The true challenge is emotional dissonance: inconsistencies between the emotions people
feel and the emotions they project. It can help you to separate emotions into felt emotions
(an individual’s actual emotions) or displayed emotions (emotions that are organizationally
required and considered appropriate in a given job).
Surface acting: hiding one’s inner feelings and forgoing emotional expressions in response
to display rules.
Deep acting: trying to modify one’s true inner feelings based on display rule e.g. empathy for
a patient.

Affective events theory (AET): a model which suggests that workplace events cause
emotional reactions on the part of employees, which then influence workplace attitudes and
behaviors (job performance and satisfaction). A figure explaining the theory:

Work
environment
- Characteristics of Emotional
the job Work events Job satisfaction
reactions
- Job demands - Daily hassles &
- Positive
- Requirements for - Daily uplifts Job performance
- Negative
emotional labor

Personal dispositions
- Personality
- Mood

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Emotional intelligence (EI): the ability to detect and to manage emotional cues and
information.
 Arguments in favor of EI:
o There’s a lot of intuitive appeal to the EI concept
o EI predicts criteria that matter: high level EI  perform well
o EI is biologically based: in the brains
 Criticism against EI:
o EI is too vague a concept
o EI can’t be measured
o The validity of EI is suspect. It is too closely related to intelligence and
personality, that it’s questioned what EI has to offer

How an understanding of emotions and moods can improve our ability to explain and predict:
 Selection. Hiring people with a high EI does improve performance.
 Decision-making. Moods and emotions have important effects on this.
o Positive moods and emotions help decision-making
o The role of negative moods and emotions is unclear, but probably hinder it
 Creativity. People in good moods are more creative but critics say it makes them
more ‘relaxed’ and are therefore less creative.
 Motivation. Positive moods increase motivation, but research also suggests that
giving people feedback (real or fake) about their performance influenced their mood,
which then influenced their motivation ( a cycle).
 Leadership. Emotions and moods are critical for influencing subordinates.
 Negotiation. A negotiator who feigns anger has an advantage over the opponent, but
feeling bad about your performance appears to impair future negotiations.
 Customer service. Emotional dissonance can occur  lower job satisfaction. In
addition, employees’ emotions may transfer to the customer: emotional contagion.
 Job attitudes. A good/bad day at work  good/bad mood. By the next day the effect
is gone.
 Deviant workplace behaviors. They can be traced to negative emotions.

Managers can influence mood by, for example: humor, tokens of appreciation, or selecting
positive team members (for the emotional contagion).

Global implications:
 The degree to which people experience emotions varies across cultures.
 All cultures interpret emotions the same way, but some value certain emotions more
than others.
 The norms for the expression of emotions definitely differ across cultures.

Chapter 9: foundations of group behavior

Group: two or more individuals, interacting and interdependent, who have come together to
achieve particular objectives.
 Formal group: a designated group defined by an organization’s structure.
o Command group: a group composed of the individuals who report directly to
a given manager
o Task group: people working together to complete a task job
 Informal group: a group that is neither formally structured nor organizationally
determined; such a group appears in response to the need for social contact.
o Interest group: people working together to attain a specific objective with
which each is concerned
o Friendship group: people brought together because they share one or more
common characteristics
The most popular reasons for people joining groups are: security; status; self-esteem;
affiliation (fulfill social needs); power; and goal achievement.

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Five-stage group-development model: the five distinct stages groups go through. They are:
1. Forming stage: characterized by much uncertainty.
2. Storming stage: characterized by intragroup conflict.
3. Norming stage: characterized by close relationships and cohesiveness.
4. Performing stage: the group is fully functional.
5. Adjourning stage: characterized by concern with wrapping up activities rather than
task performance (only counts for temporary groups).
Criticism: there might be conflict so sometimes stage 2 can outperform stage 3 and 4; groups
do not always proceed clearly from one stage to the next; and it ignores organizational
context (good organized  develop faster).

Punctuated-equilibrium model (essential for temporary groups): (1) First meeting sets
group direction, (2) this first phase of group activity is one of inertia (slow), (3) a transition at
the end of the first phase, exactly at the first half of the allotted time, (4) transition initiates
major changes, (5) second phase of inertia, and (6) last meeting characterized by markedly
accelerated activity.

Work groups have properties that shape the behavior of members and make it possible to
explain/predict a large portion of individual behavior within the group and of performance of
the group itself. Some of the properties are:
 Group property 1: roles: a set of expected behavior patterns attributed to someone
occupying a given position in a social unit. It consists of diverse roles (on and off job).
o Role identity: certain attitudes/behaviors consistent with a role
o Role perception: an individual’s view of how he/she is supposed to act in a
given situation. High  increases performance
o Role expectation: how others believe a person should act in a given
situation
 Psychological contract: an unwritten agreement that sets out what
management expects from an employee and vice versa
o Role conflict: a situation in which an individual is confronted by divergent
role expectations
o Example: Zimbardo’s prison experiment (being either guard or prisoner)
 Group properties 2 and 3: norms and status. Norms: acceptable standards of
behavior within a group that are shared by the group’s members.
o Most important group norm: performance norm.
o Others: appearance norms (e.g. dress codes, when to look busy), social
arrangement norms (e.g. with who eat lunch, whether to form friendships),
resource allocation norms (e.g. assignment difficult jobs, distribution pay).
o Example: the Hawthorne studies
o Conformity: the adjustment of one’s behavior to align with the norms of the
group. You desire acceptance  conform to group’s norms
 Reference groups: important groups to which individuals belong or
hope to belong & with whose norms individuals are likely to conform
o Deviant workplace behavior (antisocial behavior or workplace incivility):
voluntary behavior that violates significant organization norms and, in so
doing, threatens the well-being of the organizations or is members. It
happens more in groups than alone because of the norms
 Categories: production, property, political, and personal aggression
 Group properties 2 and 3: norms and status. Status: a socially defined position or
rank given to groups or group members by others.
o Status characteristics theory: states that differences in status
characteristics create status hierarchies within groups. Derived from:
 The power a person wields over others: high status
 A person’s ability to contribute to a group’s goals: high status
 An individual’s personal characteristics: positive = high status
o People with a high status dare deviating from others and are more assertive
o Group members should believe that the status hierarchy is equitable
 Group property 4: size. The size of a group affects the groups’ overall behavior.
Small = faster, individuals perform better (action-taking tasks). Large = diverse input
 higher marks (fact-finding activities).

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o Social loafing: the tendency for individuals to expend less effort when
working collectively than when working individually. Reasons could be seeing
others as lazy/inept, and dispersion of responsibility (free riders). Solutions:
group goals, intergroup competition, peer evaluation, and distribute rewards
 Group property 5: cohesiveness: the degree to which group members are attracted
to each other and at motivated to stay in the group. Encourage it by group goals,
small groups, much time, increase status, stimulate competition, give group rewards.
Cohesiveness
Performance Norms
Moderate
High productivity
productivity

Moderate to low
Low productivity
productivity

Group decision-making
 Strengths: more complete information and knowledge; increased diversity of views;
and increased acceptance of solution.
 Weaknesses: time-consuming; conformity pressures; dominated by few members;
ambiguous responsibility.

Effectiveness and efficiency of group decision-making depends on:

 Effectiveness:
o Accuracy: a group’s decisions are more accurate than an average individual
o Speed: individuals are superior
o Creativity: groups are more effective than individuals
o Acceptance: nod goes to the group
 Efficiency:
o Groups almost always stack up as a poor second to the individual

Groupthink: a phenomenon in which the norm for consensus overrides the realistic appraisal
of alternative courses of action. Symptoms are:
 Group members rationalize any resistance to the assumptions they have made.
 Members apply direct pressures on those who momentarily express doubts.
 Members with doubts / different points of view seek to avoid deviating from what
appears to be group consensus by keeping silent about misgivings.
 Illusion of unanimity: if someone doesn’t speak, it’s assumed they agree.
Groupshift: a change in decision risk between a group’s decision and an individual decision
that a member within the group would make; the shift can be toward either conservatism or
greater risk, but more often toward risk because the members become more comfortable and
because the group diffuses responsibility.

Group decision-making techniques:

 Interacting groups: typical groups in which members interact face-to-face.
 Brainstorming: an idea-generation process that specifically encourages any and all
alternatives while withholding any criticism of those alternatives (but research shows
that individuals generate more ideas than a group in brainstorming).
 Nominal group technique: individual members meet face-to-face to pool their
judgments in a systematic but independent fashion. Everyone’s present but operate
independently. This technique is better than brainstorming.
o Steps: independently write down ideas; each member presents 1 idea;
discussion for clarity and evaluation; each member rank-orders the ideas
 Electronic meeting: members interact on computers, allowing for anonymity of
comments and aggregation of votes. It provides honesty and speed. It’s less effective
and requires more time, and resulted in reduced member satisfaction.

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Global implications: there are three areas of groups research where cross-cultural issues are
particularly important. These are:
 Status and culture. Cultural differences affect status.
 Social loafing. Has a Western bias: it’s consistent with individualistic cultures, but
inconsistent with collective societies.
 Group diversity. There are both benefits and costs (conflicts) from group diversity.

Perception-performance relationship: high congruence between a boss and an employee as

to the perception of the employee’s job  high employee satisfaction.
Most people prefer communicating with higher- or same-status people and not lower-status.
The group size-satisfaction relationship: larger groups are less satisfied.

Chapter 10: understanding work teams

Nowadays, teams are everywhere. They are a better way to use employee talents. Teams
are more flexible and responsive to changing events. They are an effective means for
management to democratize their organizations and increase employee motivation.

Work group: a group that interacts primarily to share information and to make decisions to
help each group member to perform within his or her area of responsibility. Its performance is
the summation of each group member’s individual contribution.
Work team: a group whose individual efforts result in performance that is greater than the
sum of the individual inputs.
Goal Synergy Accountability Skills
Work groups Share information Neutral (sometimes negative) Individual Random and varied
Work teams Collective performance Positive Individual and mutual Complementary

The four most common types of teams:

 Problem-solving teams: groups of 5 to 12 employees from the same department
who meet for a few hours each week to discuss ways of improving quality, efficiency
& the work environment. There is rarely authority to unilaterally implement an action.
 Self-managed work teams: groups of 10 to 15 people who take on responsibilities of
their former supervisors (Planning, scheduling, assigning, decision making, etc.). The
effectiveness depends on the strength/make-up of the team norms, the type of tasks,
and the reward structure.
 Cross-functional teams: consists of employees from about the same hierarchical
level, but from different work areas, who come together to accomplish a task
(horizontal, boundary-spanning). It is effective but hard to manage.
 Virtual teams: use computer technology to tie together physically dispersed
members in order to achieve a common goal. They face special challenges. They are
less satisfied and more task-oriented. Management should ensure that (1) there is
trust, (2) team progress is monitored closely, and (3) efforts/products are publicized
throughout the organization.
Context of teams Team composition Work design of teams Process of teams
Adequate resources Abilities of members Autonomy Common purpose
(Technical expertise, problem- (= A vision, broader than goals)
solving and decision-making skills, (Reflexivity: reflecting/adjusting
interpersonal skills (consciousness the master plan when needed
and openness))
Leadership and structure Personality Skill variety Specific goals
(Especially in multi-team (Big Five personality model Ch. 4) ( Higher performance, energize
systems: different teams need to (The more conscious members, the teams, facilitate clear
coordinate their efforts to produce better) communication, maintain focus)
a desired outcome) (Should be a challenging goal)
Climate of trust Allocating roles Task identity Team efficacy (=voortvarendheid)
(The belief to succeed)

Performance evaluation and Diversity Task significance Mental models: team members’
reward systems (Has negative effects! Need to (Substantial impact on others) knowledge/beliefs about how the
focus on differences instead of work gets done by the team.
similarities) (Organizational
demography: the degree to which
members of a work unit share a
common demographic attribute the
impact of this attribute on turnover)
Size of teams Conflict levels
(The smaller, the better) (It can improve effectiveness and
reduce the groupthink!)
Member preferences Social loafing
(Members should be willing to work (The less, the more effective)
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The primary options managers have for trying to turn individuals into team players:
 Selection: hiring team players in addition to the technical skills required to fill the job.
Managers can choose to:
o Candidates undergo training to ‘make them into team players
o Transfer the candidate to another unit within the organization without teams
o Don’t hire the candidate
 Training: creating team players by workshops and learning the five-stage group
development model described in chapter 9.
 Rewarding: providing incentives to be a good team player. This doesn’t mean
individual contributions should be ignored; they should be balanced with selfless
contributions to the team. Examples: pay raises and intrinsic rewards.

Teams are not always the answer because it takes more time and often more resources.
Benefits of using teams should exceed the costs, which is not always the case! There are
three tests to see if a team fits the situation:
 Can the work be done better by more than one person? (Complexity, need for
different perspectives)
 Does the work create a common purpose / set of goals for the people in the group
that is more than the aggregate of the individual goals?
 Are the members of the group interdependent?

Global implications
 Extent of teamwork: widespread across Europe (especially in the North), and also in
the US (but less significant).
 Self-managed teams: in countries that are relatively high in power distance –
meaning that roles of leaders and followers are clearly delineated – a team may need
to be structured  leadership roles spelled out and power relationships identified.
 Team cultural diversity and team performance: culturally heterogeneous  more
difficult to work together, but seem to dissipate with time (three months).

Chapter 11: Communication

Poor communication is probably the most frequently cited source of interpersonal conflict.
High communication skills is the most important characteristic of an ideal job candidate.
Communication: the transfer and understanding of meaning. Perfect communication is never
achieved.

Communication serves four major functions within a group or organization:

 Control member behavior in several ways.
o Formal: authority hierarchies and formal guidelines
o Informal: e.g. if work groups tease/harass a member who produces too much
 Foster motivation clarifying to employees what is to be done, how well they do, etc.
o Goal-setting and reinforcement theories in Ch. 6
 Release for emotional expression.
 Provides information that individuals/groups need to make decisions.

The communication process:

Sender Receiver
Encoding Message
Message to be message: Channel/mediu Message decoding:
sent coverted to m received
symbolic form retranslating

Noise:
Communication
barriers

Feedback

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Formal channels: communication channels established by an organization to transmit

messages related to the professional activities of members.
Informal channels: communication channels that are created spontaneously and that
emerge as responses to the individual choices.

Communication flows:
 Vertically
o Downward communication: higher level  lower level
 Explain why a decision is made to increase employee engagement
o Upward communication: lower level  higher level
 Feedback to managers
 Laterally (horizontal): among members of the same workgroup or at the same level,
to save time and facilitate coordination. It can turn out either positive or negative.

Three basic methods of communication:

 Oral communication: speeches, one-to-one, discussion, rumor mill, or grapevine.
o Advantages: speed and feedback
o Disadvantage: it surfaces whenever a message has to be passed through a
number of people. The more people, the greater the potential distortion.
 Written communication: memos, letters, fax transmissions, e-mail, and notices.
o Advantages: verifiable, can be stored, people are more careful when writing
o Disadvantages: time-consuming, lack of feedback
 Nonverbal communication: body movements, intonations, facial expressions, and
distance between sender and receiver. It can add to verbal communication. The two
most important messages through body language:
o The extent to which an individual likes another and is interested in him/her
o The relative perceived status between the sender and perceiver

Formal small-group networks

 Chain: follows the formal chain of command (three-level organization).
 Wheel: relies on one central figure to act as the conduit for all communication.
 All channel: free to contribute, no leadership role (self-managed teams).

Grapevine: an organization’s informal communication network. Although informal, it’s still an

important source of information. Three characteristics: (1) not controlled by managers, (2)
perceived by most employees as being more believable/reliable than formal communiqués by
top management, and (3) largely used to serve the self-interests of the people within it.
Rumors start when (1) it’s important to us, (2) there’s ambiguity, and (3) it arouses anxiety.

What managers can do to reduce negative consequences of rumors:

 Announce timetables for making important decisions.
 Explain decisions/behaviors that may appear inconsistent/secretive.
 Emphasize the downside, as well as the upside, of current decisions / future plans.
 Openly discuss worst-case possibilities; they are almost never as anxiety provoking
as the unspoken fantasy.

Electronic communications (71% of the cases the primary medium!):

 E-mail. It has many advantages, but there are some drawbacks:
o Misinterpreting the message (intent ant tone)
o Communicating negative messages (e-mail may not be best way for
communicating bad news)
o Overuse of e-mail (too many e-mails, waste of time, delay decision making)
o E-mail emotions (say things you don’t dare saying in person)
o Privacy concerns (e-mails may be monitored, and you cannot always trust
the recipient to keep it confidential)
 Instant messaging (IM) and text messaging (TM). Fast and inexpensive, but can’t
replace e-mail. Watch informality!
 Networking software. Facebook, MySpace (personal) and LinkedIn (professional).

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 Web logs (blogs): a website where entries are written, generally displayed in reverse
chronological order, about news, events and personal diary entries.
 Video conferencing: have meetings with people at different locations.

Knowledge management (KM): the process of organizing and distributing an organization’s

collective wisdom so the right information gets to the right people at the right time. It provides
a competitive edge. It requires an organizational culture that promotes, values and rewards
sharing knowledge, but information overload needs to be avoided.

The choice of the communication channel is very important.

Channel richness: the amount of information that can be transmitted during a
communication episode. That is, it offers multiple information cues, immediate feedback, and
the personal touch of ‘being there’. (High = videoconference, face-to-face, low = memos,
bulletins, formal reports).
The choice depends on whether the message is routine (straightforward, minimum of
ambiguity) or nonroutine (complicated, chance of misunderstanding). Routine message can
be communicated with low channel richness, and nonroutine message should be
communicated with high channel richness. Most effective managers are expanding their use
of rich channels.

Barriers that can retard/distort effective communication:

 Filtering: a sender’s manipulation of information so that it will be seen more favorably
by the receiver.
 Selective perception: receivers selectively see/hear based on their frame of
reference.
 Information overload: a condition in which information inflow exceeds an individual’s
processing capacity  select, ignore pass over or forget information.
 Emotions: influences interpretation.
 Language: language skills are highly sought after. Age and context influence the
language a person uses and the definitions he/she gives to words the most.
 Communication apprehension: undue tension and anxiety about oral
communication, written communication, or both.
 Gender differences: women use it to create connections/intimacy (mutual
understanding, which is symmetrical); men speak/hear language of status, power and
independence (give advice, which is asymmetrical (men ‘more knowledge’)).

Global implications:
 Language difficulties in cross-cultural communications:
o Barriers caused by semantics (words mean different things to people)
o Barriers caused by word connotations (words imply different things in
different languages)
o Barriers caused by tone differences (e.g. formal vs. informal)
o Barriers caused by differences among perceptions (people who speak
different language view the world in different ways)
 High-context cultures: cultures that rely heavily on nonverbal and subtle situational
cues in communication (Asian)  more trust, ‘make suggestions’.
 Low-context cultures: cultures that rely heavily on words to convey meaning in
communication (Western)  written contracts, value directness, give orders.
 Reduce misunderstandings among different cultures:
o Assume differences until similarity is proven
o Emphasize description rather than interpretation or evaluation
o Practice empathy: put yourself in recipient’s shoes.
o Treat your interpretations as a working hypothesis: needs further testing.\

Chapter 12: Basic approaches to leadership

Whereas management is about coping with complexity, leadership is about coping with
change. Leadership: the ability to influence a group toward the achievement of a vision set or
goals. Leader can emerge from within a group as well as by formal appointment.

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Organizations needs strong leadership and strong management for optimal effectiveness.

Trait theories of leadership (1940s): theories that consider personal qualities and
characteristics that differentiate leaders from nonleaders (e.g. charismatic, enthusiastic,
courageous). Leaders are born rather than made.
 Big Five personality model (Ch. 4): extraverted (not too assertive), consciousness
and openness to experience (but not: agreeableness and emotional stability).
 Emotional Intelligence (EI) (Ch. 8): especially empathy (sense others’ needs).

Behavioral theories of leadership (1940s-1960s): theories proposing that specific behaviors

differentiate leaders from nonleaders. Leaders are made/trained rather than born.
 Ohio State studies: Initiating structure (the extent to which a leader is likely to
define and structure his or her role and those of subordinates in the search for goal
attainment) vs. Consideration (the extent to which a leader is likely to have job
relationships characterized by mutual trust, respect for subordinates’ ideas, and
regard for their feelings).
 University of Michigan studies: Employee-oriented leaders (emphasizing
interpersonal relations, takes personal interest, and accepts individual differences)
vs. Production-oriented leaders (emphasizing technical/task aspects of the job).
o Employee-oriented = consideration (from Ohio State studies)
 Both high job satisfaction and high group productivity
o Production-oriented = initiating structure (from Ohio State studies)
 Both low job satisfaction and low group productivity
o Managerial grid (leadership grid): outlines 81 different leadership styles:
High

1,9 9,9
 9,1 = authority type
 1,9 = laissez-faire type
Concern for people

 9,9 = best
5,5
 1,1 = worst
Low

1,1 1,9

Low Concern for production High

Perhaps trait theories and behavioral theories should be integrated, e.g. conscious (trait) fits
with structuring (behavior). However, research is still needed for this.

Trait theories and behavioral theories aren’t the last word on leadership. Missing is
consideration of situational factors that influence success or failure.

Predicting leadership success is more complex than isolating a few traits or preferable
behaviors. The relationship between leadership style and effectiveness suggested that under
condition a, style x would be appropriate, condition b for style y and condition c for style z.
Contingency theories are:
 Fiedler contingency model: the theory that effective groups depend on a proper
match between a leader’s style of interacting with subordinates and the degree to
which the situation gives control and influence to the leader.
o Identifying leadership style: least preferred co-worker (LPC)
questionnaire: task- or relationship-oriented?
o Defining the situation: three contingency dimensions that define the key
situational factors that determine leadership effectiveness:
 Leader-member relations: confidence, trust, respect in leader
 Task structure: are job assignments procedurized (structured)?
 Position power: influence of leader over power variables like hiring,
firing, discipline, promotions and salary increases

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o Matching leaders and situations: match LPS score and three contingency
variables:
 Task-oriented  highly favorable situations
 Relationship-oriented  moderately favorable situations
 Either change the leader or change the situation
o The model has a positive evaluation, except that LPC scores are not stable
and that the contingency variables are hard to measure
o Reconceptualization: cognitive resource theory: a theory of leadership
which states that stress unfavorably affects a situation and that intelligence
and experience can reduce the influence of stress on the leader
 Hersey and Blanchard’s situational leadership theory (SLT): a contingency
theory that focuses on followers’ readiness. The followers should accept the leader.
Readiness: the extent to which people have the ability and willingness to accomplish
a specific task.
o Leader-follower relationship  parent-child relationship (relinquish control as
a child becomes mature): from highly directive to laissez-faire
 Unable and unwilling: clear and specific directions
 Unable and willing: high task and high relationship orientation
 Able and unwilling: supportive and participative style
 Able and willing: not much to do
o The theory has a high intuitive appeal but cannot be supported
 Path-goal theory by House: states that it is the leader’s job to assist followers in
attaining their goals and to provide the necessary direction and/or support to ensure
that their goals are compatible with the overall objectives of the group/organization.
Four leadership behaviors:
o Directive leader: lets followers know what is expected of them
o Supportive leader: friendly and shows concern for the needs of the followers
o Participative leader: consults with followers and uses their suggestions
o Achievement-oriented leader: sets challenging goals, expects performance
There are two classes of contingency variables that moderate the leadership
behavior-outcome relationship:
o Environmental factors (outside control of employee; determine the type of
leader behavior required as a complement if follower outcomes are to be
maximized): task structure, formal authority system, work group
o Personal characteristics (determine how the environment and leader
behavior are interpreted): locus of control (internal or external), experience,
perceived ability

None of the contingency variables have panned out as well as their developers had hoped. A
limitation to all theories is that they ignore the followers. Leaders don’t use a fairly
homogeneous style with all the people in their work unit, but this is always assumed.

Leader-member exchange (LMX) theory: supports leaders’ creation of in-groups and out-
groups; subordinates with in-groups status will have higher performance ratings, less
turnover, and greater job satisfaction (self-fulfilling prophecy Ch. 5).

Vroom and Yetton’s leader-participation model: a leadership theory that provides a set of
rules to determine the form and amount of participative decision making in different situations.

Clusters with each cluster having different leadership styles, among Europe:
 Cluster 1: the Anglo culture (UK and Ireland)  empowering and motivating people.
 Cluster 2: Scandinavian countries  same as Cluster 1 but instead of competitive
individualism of the Anglos, there is a concern for quality of life in general (more
about relationships than results).
 Cluster 3: Mediterranean cluster  leaders are seen as, and expected to be more
powerful.
Western Europe: equality, achievement, participative style.
Eastern Europe: power differentials are expected or accepted, autocratic style.

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Global implications:
 The American bias is well documented, but:
 Culture does have a pervasive influence on leadership effectiveness.
 The GLOBE study found that some traits are endorsed universally as positive
attributes for leaders, whereas the endorsement of other traits is culturally contingent.
 The global relevance of contingency theories (different leadership styles suited to
different situations) has been questioned. Western countries more in line with US.
 Countries with low power-distance are more likely to accept participative leadership
models (more democratic instead of autocratic).
 Accenture survey provides an example that identifies three competencies of effective
global leaders:
o Personal mastery – high degree of self-awareness
o Provide organizational leadership by creating internal and external networks
of influence (alliances; partnerships; formal acquisitions; mergers)
o Building organizational and individual competence by seeking and using
differences of thought, style and culture around the globe

Chapter 13: Contemporary issues in leadership

Framing: a way of using language to manage meaning; selecting and highlighting one or
more aspects of a subject while excluding others. It is important for the ability of the leader to
inspire others to act beyond their immediate self-interests. There are two leadership theories
for the view that leaders inspire followers through their words, ideas an behaviors:
 Charismatic leadership theory: states that followers make attributions of heroic or
extraordinary leadership abilities when they observe certain behaviors.
Characteristics: have vision and articulation, take personal risks, are sensitive to
follower needs, and exhibit unconventional behavior.
o Charismatic leaders can be made and can be born
 Made: (1) create aura of charisma, (2) create a bond that inspires
others to follow, and (3) tap into follower’s emotions
o How to influence followers: (1) appealing vision: a long-term strategy for
attaining a goal, and a vision-statement: a formal articulation of an
organization’s vision or mission, (2) communicate high performance
expectations and confidence that followers can attain them, (3) convey a new
set of values and set an example, and (4) emotion-inducing and
unconventional behavior to demonstrate courage and convictions
o Key properties of a vision: inspirational possibilities that are value centered,
realizable, with superior imagery and articulation
o There is a high correlation between charismatic leadership and high
performance and satisfaction among followers, but it may depend on the
situation (ideology, uncertainty, higher-level, anxiety, and low self-esteem all
create a positive correlation between a charismatic leader and performance)
o Charismatic leaders should not be ego-driven and follow their own interests,
but level-5 leaders: leaders who are fiercely ambitious and driven but whose
ambition is directed towards their company rather than themselves
 Transformational leadership: inspire followers to transcend their own self-interests
and who are capable of having a profound and extraordinary effect on followers. This
is different from transactional leaders: guide or motivate their followers in the
direction of established goals by clarifying role and task requirements (apply to Ohio
State studies, Fiedler’s model and path-goal theory in Ch. 12).
o Transformational leaders build on top of transactional leaders
o Transformational leaders are effective because they are creative and
encourage their followers to be creative as well.
o Transformational leaders are also effective because of their goals/visions
and because they create commitment on the part of followers.
o Transformational leaders can be made and can be born.

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Transactional leader Transformational leader

The numbers in the table
(5) Contingent reward: contracts exchange of rewards for (1) Idealized influence: provides vision and sense of
indicate which style is most
effort, promises rewards for good performance, recognizes mission, instills pride, gains respect and trust
accomplishments effective (1) and which one
(6) Management by Exception (active): watches and (2) Inspirational motivation: communicates high is least effective (7).
searches for deviations from rules and standards, takes expectation, uses symbols to focus efforts, expresses
correct action important purposes in simple ways The more ineffective, the
(6) Management by Exception (passive): intervenes only (3) Intellectual stimulation: promotes intelligence, more passive, and the
if standards are not met rationality and careful problem solving more effective, the more
(7) Laissez-faire: abdicates responsibilities, avoids making (4) Individual consideration: gives personal attention, active.
decisions treats each employee individually, coaches, advises

Although research argue that transformational leadership is broader than charismatic

leadership, measures of charisma and transformational leadership may be roughly
equivalent.

Some scholars have argued that a consideration of ethics and trust is essential to complete
the picture of effective leadership. Authentic leaders: who know who they are, know what
they believe in and value, and act on those values and beliefs openly and candidly. Their
followers would consider them to be ethical people. Trust is most important, which is gained
through sharing information, encouraging open communication and sticking to their ideals.

Ethics touches leadership at a number of junctures:

 Transformational leaders: try to change attitudes and behaviors of followers.
 Charismatic leaders: enhance power of followers, directed towards self-serving ends.

Socialized charismatic leadership: a leadership concept that states that leaders convey
values that are other-centered versus self-centered and who role model ethical conduct.

Organizations have become less stable and predictable, so trust is very important. Trust: a
positive expectation (assumes knowledge/familiarity) that another will not act opportunistically
(inherent risk and vulnerability in any trusting relationship). It’s willingness to take risk. The
key dimensions that underlie the concept of trust are:
 Integrity: honesty and truthfulness (most critical).
 Competence: encompasses an individual’s technical and interpersonal knowledge
and skills. Believe that the person has the skills and abilities.
 Consistency: individual’s reliability, predictability and good judgment in handling
situations.
 Loyalty: the willingness to protect and save face for another person.
 Openness: the person must give you full truth.

There are three types of trust:

 Deterrence-based trust: trust based on fear of reprisal if the trust is violated. One
inconsistency can destroy the relationship; it’s very fragile (lowest level of trust).
 Knowledge-based trust: trust based on behavioral predictability that comes from a
history of interaction. With this kind of trust, forgiveness is more likely to occur.
 Identification-based trust: trust based on a mutual understanding of each other’s
intentions and appreciation of each other’s wants and desires (highest level of trust).

Basic principles of trust:

 Mistrust drives out trust: a few mistrusting people can poison an entire
organization.
 Trust begets trust (= verwekken).
 Trust can be regained: only when someone failed to do what was expected, not with
deception.
 Mistrusting groups self-destruct: they repel and separate.
 Mistrust generally reduces productivity (but trust does not increase productivity).

Three leadership role issues:

 Many leaders create mentoring relations. Mentoring: a senior employee who
sponsors and supports a less-experienced employee, called a protégé. It may feel

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nice to have mentor, but it does not appear that having a mentor is important to one’s
career. It has two functions: career functions and psychological functions.
 People might be able to lead themselves. Self-leadership: a set of processes
through which individuals control their own behavior. Leaders might help them with
this by developing leadership capacity and nurturing followers. The importance of
self-leadership has increased with the expanded popularity of teams
 Online leadership: there is no nonverbal communication, so online leaders need to
develop the skill of deciphering the emotional components of messages. A great
challenge for them is developing and maintaining trust. Overall, good interpersonal
skills are necessary; writing skills may become an extension of this.

In many cases, success or failure is just a matter of being in the right or wrong place at a
given time. You cannot always give all the credits or all the blame to the leader. Two
perspectives that challenge the widely accepted belief in the importance of leadership:
 Attribution theory of leadership: a leadership theory which says that leadership is
merely an attribution that people make about other individuals. You don’t have to be
an effective leader as long as you look like one. The attributions framework accounts
for the (extreme) conditions under which people use leadership to explain
organizational outcomes.
 Substitutes for and neutralizers of leadership: leadership may not always be
important. Certain individual, job and organizational variables can act as substitutes
for leadership or neutralize the leader’s influence on their followers. It’s too simplistic
to consider employees as guided to goal accomplishments solely by the actions of
their leader. Leadership is merely another independent variable in our overall OB
model.

How can organizations find or create effective leaders?

 Selecting leaders: specific requirements for the situation; personality tests / EI /
interviews; plan for leadership changes: when (not whether) does a leader exist?
 Training leaders: recognize people are note equally trainable (need people with high-
monitors); teach certain skills; modeling exercises; transformational leadership skills.

Global implications:
 Charismatic and transformational leadership styles works in different cultures.
 A vision is important in any culture, but how that vision is formed and communicated
may still need to vary by culture.

Chapter 14: Power and politics

Power: a capacity that A has to influence the behavior of B so that B acts in accordance with
A’s wishes. It is a capacity or potential. Probably the most important aspect of power is that it
is a function of dependency: B’s relationship to A when A possesses something that B
requires. The greater B’s dependence on A, the greater is A’s power in the relationship.

Leaders use power as a means of attaining group goals. The difference between the terms:
 Power does not require goal compatibility, merely dependence. Leadership requires
some congruence between the goals of the leader and those being lead.
 Leadership focuses only on the downward influence on one’s followers, and power
does not.
 Leadership research empathizes style, power encompasses a broader area, focusing
on tactics for gaining compliance. It can be used by groups as well as individuals.

Sources of power:
 Formal power: position in an organization. Not/negatively related to satisfaction.
o Coercive power: a power base that is dependent on fear. Examples:
punishments, embarrassing employees, withholding key information
o Reward power: compliance achieved based on the ability to distribute
rewards that others view as valuable
 The two above mentioned powers are counterparts of each other

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o Legitimate power: the power a person receives as a result of his or her

position in the formal hierarchy of an organization
 Personal power: no formal position in an organization, comes from unique
characteristics. This is positively related to satisfaction.
o Expert power: influence based on special skills or knowledge (most
important for managers!)
o Referent power: influence based on possession by an individual of desirable
resources or personal traits. If I like you, you can exercise power of me
because I want to please you (through charisma)

Dependency is inversely proportional to the alternative sources of supply. If something is

plentiful, possession of it will not increase your power. Dependency is increased when:
 It is of high importance.
 It is scarce.
 There is nonsubstitutability.

Power tactics: ways in which individuals translate power bases into specific actions. There
are nine distinct influence tactics:
 Legitimacy: relying on one’s authority position or stressing that a request is in
accordance with organizational policies or rules.
o Effective in downward influence and lateral influence
 Rational persuasion: presenting logical arguments and factual evidence to
demonstrate that a request is reasonable.
o Effective in upward influence, downward influence, and lateral influence
 Inspirational appeals: developing emotional commitment by appealing to a target’s
values, needs, hopes and aspirations.
o Effective only in downward influence
 Consultation: increasing the target’s motivation and support by involving him/her in
deciding how the plan or change will be accomplished.
o Effective in downward influence and lateral influence
 Exchange: rewarding the target with benefits or favors in exchange for following a
request.
o Effective in downward influence and lateral influence
 Personal appeals: asking for compliance based on friendship or loyalty.
o Effective only in lateral influence
 Pressure: using warnings, repeated demands and threats.
o Effective only in downward influence
 Coalitions: enlisting the aid of other people to persuade the target or using the
support of others as a reason for the target to agree.
o Effective only in lateral influence

You’re more likely to be successful if you begin with ‘softer’ tactics that rely on personal
power and if this fails, move on to ‘harder’ tactics which emphasize formal power and involve
greater costs and risks. A combination of the two is the best.

People differ in their political skill: the ability to influence others in such a way as to enhance
one’s objectives.
The organizational culture has a bearing on defining which tactics are considered appropriate.

When employees in organizations convert their power into action, we describe them as being
engaged in politics. Political behavior: activities that are not required as part of a person’s
formal role in the organization but that influence, or attempt to influence, the distribution of
advantages and disadvantages within the organization.
 Legitimate political behavior: normal everyday politics, like complaining to
supervisor, bypassing the chain of command, forming coalitions, etc.
 Illegitimate political behavior: extreme political behavior that violates the implied
rules of the game. It’s not done that much because of pragmatic reasons.

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Why politics exist:

 Everyone has different values, goals and interests which leads to conflict.
 There always is competition among members for the organization’s limited resources.
 Most of the facts that are used to allocated limited resources are open to
interpretation. Example: ‘blaming others’ (perceived) vs. ‘ fixing responsibility’ (fact).
Politicking: people within organizations will use whatever influence they can to taint the facts
to support their goals and interests.

Individual factors:
 High self-monitors: sensitive to social cues
 Internal locus of control: belief to control the environment
 High Mach personality: will to manipulate, desire for power
 Organizational investment: the more invested, the more to
lose, the less like to conduct illegitimate behavior
 Perceived job alternatives: the more alternatives, the more
risk he would take for illegitimate behavior
 Expectations of success (when conducting illegitimate
behavior) Political behavior: Favorable outcomes:
Low  high  Rewards
Organizational factors:  Averted
 Reallocation of resources: safeguard what you have punishments
 Promotion opportunities: encourages to compete for a
limited resource and to try to positively influence the
decision outcome
 Low trust: high level of political behavior, especially
illegitimate
 Role ambiguity: prescribed behaviors not clear, so political
behavior less visible
 Unclear performance evaluation system: subjective or long
time between action and appraisal
 Zero-sum reward practices: gains of one are at the
expense of another
 Democratic decision making
 High performance pressures: likely to do politicking
 Self-serving senior managers: employees see people on
top engaging in political behavior

Organizational politics may threaten employees:

 Decreased job satisfaction: when people perceive politics as a threat rather than as
an opportunity  defensive behaviors: reactive and protective behaviors to avoid
action, blame, or change.
 Increased anxiety and stress.
 Increased turnover.
 Reduced performance: if employees don’t understand the ‘hows’ and ‘whys’ of
organizational politics. If people do understand this and therefore have good political
skills, their performance, job satisfaction, and perhaps pay will increase.

People from politically turbulent countries in the Middle East or Latin America might be more
accepting of organizational politics, and even more willing to use aggressive political tactics.

Impression management (IM): the process by which individuals attempt to control the
impression others form of them. High self-monitors are more likely to engage in IM. Low
self-monitors tend to present images of themselves that are consistent with their
personalities, regardless of the beneficial or detrimental effects for them. The impression
manager must be cautious not to be perceived as insincere or manipulative.

Some impression management techniques are:

 Conformity: agreeing with someone else’s opinion in order to gain their approval.
 Excuses.
 Apologies.
 Self-promotion.
 Flattery: complimenting others about their virtues.
 Favors: doing something nice for someone.
 Association: enhancing or protecting one’s image by managing information about
people and things with which one is association.

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IM techniques work for job interviews, especially self-promoting and ingratiation

(compliment interviewer and agree with their opinions).
Only ingratiation works for job performance, but self-promotion doesn’t (only negatively)
Ethical issues in behaving politically:
 You should ask yourself whether using impression management is worth the risk.
 You should ask yourself if engaging in the political behavior balances out any harm it
will do to others.
 You should ask yourself if the political activity conforms to standards of equity and
justice.
 It’s difficult to answers those questions, because immoral people can justify almost
any behavior.
 It’s a lot easier for the powerless than the powerful to act ethically.

Global implications:
 The negative consequences from politics are globally the same.
 People in different countries tend to prefer different power tactics.
o US: rational appeal (direct confrontation)
o China: coalitions (indirect approaches for difficult or controversial requests)
o Individualistic cultures (Western): more self-enhancement like self-promotion
 Less evidence whether these tactics work better in some cultures than in others.

Chapter 15: Conflict and negotiation

Conflict: a process that begins when one party perceives that another party has negatively
affected, or is about to negatively affect, something that the first party cares about.

There has been conflict over the role of conflict in groups and organizations. Different views:
 The traditional view of conflict: the belief that all conflict is harmful and must be
avoided. Conflict = negative (violence, destruction, irrationality).
 The human relations view of conflict: the belief that conflict is a natural and
inevitable outcome in any group. Sometimes it may even be beneficial.
 The interactionist view of conflict: the belief that conflict is not only a positive force
in a group but that it is also an absolute necessity for a group to perform effectively,
to keep the group viable, self-critical and creative.
o Functional conflict: supports the goals, improves performance
o Dysfunctional conflict: hinder group performance
There are three types of conflict that differentiate functional conflicts and
dysfunctional conflicts:
o Task conflict: conflict over content and goals of the work. It must be kept
low-to-moderate to consistently increase group performance
o Relationship conflict: conflict based on interpersonal relationships. It’s
almost always dysfunctional because this decreases mutual understanding
o Process conflict: conflict over how work gets done. It must be kept low in
order to be functional

Conflict process: consists of five stages:

 Stage 1: Potential opposition or incompatibility. Antecedent conditions:
o Communication (Ch. 11) (surprising: don’t ‘overcommunicate’)
o Structure (size, specialization, and reward systems stimulates conflict)
o Personal variables (personality, emotions, and values)
 Stage 2: Cognition and personalization.
o Perceived conflict: awareness by one ore more parties of the existence of
conditions that create opportunities for conflict to arise
o Felt conflict: emotional involvement in a conflict that creates anxiety,
tenseness, frustration or hostility
 Stage 3: Intentions (decisions to act in a certain way). Conflict-handling conditions
(which might always change over time):
o Competing: only satisfy your own interests (assertive, uncooperative)

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o Collaborating: satisfy all party’s interests (assertive, cooperative)

o Compromising: each party is willing to give up something (middle)
o Avoiding: withdraw or suppress a conflict (unassertive, uncooperative)
o Accommodating: place opponent’s interests above your own (unassertive,
cooperative)
 Stage 4: Behavior. Overt conflict, it becomes visible, and might deviate from the
original intentions (statements, actions, reactions):
o Conflict management: the use of resolution and stimulation techniques to
achieve the desired level of conflict
 Conflict-resolution techniques: problem solving, superordinate
goals, expansion of resources, avoidance, smoothing, compromise,
authoritative command, altering human variable, altering structural
variables
 Conflict-stimulation techniques: communication, bringing in
outsiders, restructuring the organizations, appointing a devil’s
advocate
 Stage 5: Outcomes.
o Increased group performance (functional outcomes): allowing all points to be
weighed in decisions, and cultural diversity / heterogeneity
o Decreased group performance (dysfunctional outcomes)
o Creating functional conflict: reward dissent and punish conflict avoiders

Negotiation: a process in which two or more parties exchange goods or services and attempt
to agree on the exchange rate for them.

Distributive bargaining: negotiation that seeks to divide up a fixed amount of resources; a

win/lose situation (zero-sum conditions). Example: wages.
 Fixed pie: the belief that there is only a set of amount of goods or services to be
divvied up between the parties.
 Target point: what the negotiator would like to achieve.
 Resistance point: the lowest outcome that is acceptable for one of the negotiators.
 It’s good if you make the first offer because:
o It shows power which gains advantage
o Anchoring bias (Ch. 5): tendency for people to fixate on initial information
 It’s good to reveal deadlines to let the other party reconsider his/her position

Integrative bargaining: negotiation that seeks one or more settlements that can create a
win/win solution.
 It’s preferable to distributive bargaining because it builds long-term relations.
 It does not occur very often because the necessary conditions are rarely met.
 Bargaining in teams helps in achieving more integrative bargaining.

Bargaining characteristic Distributive bargaining Integrative bargaining

Goal Get as much of the pie as possible Expand pie to get both parties satisfied
Motivation Win/lose Win/win
Focus Positions (I can’t go beyond this point Interests (Can you explain why it’s so
on this issue) important to you?)
Interests Opposed Congruent
Information sharing Low High
Duration of relationship Short term Long term

The negotiation process:

 Preparation and planning: gain information and create a strategy.
o BATNA: best alternative to negotiated agreement; least you should accept
 Definition of ground rules: who? Where? What time constraints? Limitations? Etc.
 Clarification and justification: explain original demands; informing.
 Bargaining and problem solving: give-and-take.
 Closure and implementation: most often nothing more formal than a handshake.

Individual differences in negotiation effectiveness:

 Personality traits: disagreeable introvert (Big Five) = good in distributive negotiating.

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 Moods/emotions in negotiation: acting angry = good in distributive negotiating and

positive moods/emotions = good in integrative negotiating (related to creativity Ch. 5).
 Gender differences: men and women negotiate the same, but differences do affect
the outcome (although relatively small). The view on this, however, is different (self-
fulfilling prophecy).

Third-party negotiations: when the opposing parties are unable to resolve their differences.
There are four basic third-party roles:
 Mediator: a neutral third party who facilitates a negotiated solution by using
reasoning, persuasion and suggestions for alternatives (moderate levels of conflict).
 Arbitrator: a third party to a negotiation who has authority to dictate an agreement. It
always ends in settlement
 Conciliator: a trusted third party who provides an informal communication link
between the negotiation and the opponent.
 Consultant: an impartial third party, skilled in conflict management, who attempts to
facilitate creative problem solving through communication and analysis.

Global implications:
 Belgium: comparatively low incidence of conflict, but seldom functional.
 France: fewer negative outcomes of conflict (win/win).
 Germany: most conflicts, mostly because of stress.
 The Netherlands: lowest level of conflict and least concerned about it.
 United Kingdom: behind the NL, the next least likely of conflict.
 View of the purpose of negotiation differs across cultures.
 Whether the negotiation is seen as win/lose or win/win differs across cultures.
 Whether the negotiation style is formal or informal differs across cultures.
 There are differences in whether the negotiations show or hide emotions.

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