OPERATIONAL BEHAVIOUR-1 TERM PAPER

ORGANIZATIONAL BEHAVIOUR TRENDS

CONTENTS

 OBJECTIVE

 INTRODUCTION

 DEFINITION OF OB & RELATED TERMINOLOGIES

  ROLE OF DECISION MAKING IN OB ENVIRONMENT

 CONFLICTS INVOLVED IN DECISION MAKING

 STAKEHOLDER IN DECISION MAKING

 ETHICAL DILEMMAS

 GLOBALIZATION & ITS STRATEGIC ALLIANCES

 IMPACT OF IT

 STRESS IN ORGANIZATION

 CONCLUSION

 BIBLIOGRAPHY

OBJECTIVE

The environment of organizational is so dynamic that there should be continuous up gradation,

by the organization, in practicing of organizational behavior (OB).There are various which have
affected OB and will affect it. Thus if there will not be a proper understanding of all these
factors, then it may lead to mismanagement of the employees.

This term paper is an attempt to comprehend different facets of OB and its effects on the
organization.
 INTRODUCTION

Organizational Behavior is the systematic and scientific analysis of individuals, groups, and
organizations, its purpose is to understand, predict, and improve the performance of individuals
and ultimately, the organizations in which they work. It applies theory and research from
Psychology and sociology, and managerial theory that help us to understand how to use this
knowledge to improve the effectiveness of organizations.
This paper will provide a basic description and evaluation of the trends in Organizational
Behavior (OB). It then goes on to expound on the influence of ethical behavior on decision
making in an organization and its prevalence in modern day corporate environment. It also
explores the ethical area of Organizational Behavior and how it can cause friction in the
organization stemming from personal and career oriented causes. The final parts of this study
speak about work stress and technological aspects of OB.

Firstly one must know what OB is. It's an interdisciplinary field of study and practice,
investigating the impact of individuals, groups, structure and environment on behavior within
organizations. The primary concern of OB is with people, what they do and how their behavior
affects individual, group and organizational performance.

DEFINITIONS OF OB & RELATED TERMINOLOGIES:-

Schermerhorn et al (2005), define organizational behavior (OB) as "the study of human behavior
in organizations. OB uses scientific methods to test hypotheses. OB is also a multi-disciplinary
study, taking knowledge from social and behavioral sciences and applying it to real-world
situations.

Why is organizational behavior important to study? If people are an organization most important
asset then understanding how humans behave in organizations will improve productivity.
Understanding OB allows better worker relations, more realistic expectations and improves job
satisfaction.
Organizational Culture

An organizations culture stems from "the shared beliefs and values that influence the behavior of
organizational members". Every organization has a different culture. For example, at one small
brewery, the corporate culture expects employees in any position to learn constantly about the
industry and then teach clients. The culture also encourages direct communications with any
other employee no matter what level on the org chart they are. Other company's cultures may
expect employees to only do their job and not give input at all.

Diversity

Organizations which do not have a culture of encouraging diversity are at a decided

disadvantage. In the modern world of global business, not hiring the best person for the job
solely because of gender, race, ethnicity, religion or age is not only foolish, but probably illegal.

Some organizations are even going to the extreme of trying to eliminate all subcultures and
become truly multicultural. "The multicultural organization is a firm that values diversity but
systematically works to block the transfer of societal based subcultures into the fabric of the
organization".

Communication

Two types of organizational communication exist, formal and informal. Organizations of all
sizes make use of both, whether directly or indirectly. Formal channels of communication
generally follow the chain of command or org chart and are top down. Informal channels on the
other hand tend to be more open and spontaneous. Scuttlebutt or gossip is also considered forms
informal organizational communication.
Many small companies rely more on informal communications channels. Small organizations by
and large adhere less to formal command structures and all employees are generally more active
in feedback and decision making.

Adams Equity Theory

Organizational Effectiveness and Efficiency

Organizational effectiveness measures how well an organization is in sync. Even with the best
management, superior strategy and flawless execution an organization can be less successful
than it could be. Organizations who understand employees as partners stand a much better
chance of achieving high organizational effectiveness and efficiency. "Organizational
effectiveness is about each individual doing everything they know how to do and doing it well”.

Smaller organizations should exhibit more organizational efficiency due to less bureaucratic
management. This is not always the case as smaller organizations oftentimes have less clear
strategic goals and incomplete systems. Smaller organizations tend to not have as many mature
systems in place for employees. This creates inefficiency as several, and oftentimes conflicting,
methods are created by employees and not management. These systems may also conflict with
management's strategic plan.

Organizational Learning

In today’s fast paced, global business environment, organizations need to adapt quickly to threats
and opportunities. How an organization learns directly affects the speed and efficiency of an
organization to handle opportunities and threats. Richard Karash supplies this definition, "A
"Learning Organization" is one in which people at all levels, individually and collectively, are
continually increasing their capacity to produce results they really care about".

At many small organizations, employees are constantly learning and experimenting. New
products are created and new markets serviced based on employee suggestions. At one small
brewery, gluten-free beer was conceived by a team who were researching new product ideas. The
beer was then created by the Brew master. After a one year test phase, in which many iterations
of the beer was brewed and sampled, a final product was introduced. All employees of the
company contributed and in the process learned about the beer brewing process, helping them
both professionally and personally.

ROLE OF DECISION MAKING IN OB ENVIRONMENT

Decision making can be regarded as the mental processes (cognitive process) resulting in the
selection of a course of action among several alternatives. Every decision making process
produces a final choice. The output can be an action or an opinion of choice.

Decision Making
• Objectives must first be established
• Objectives must be classified and placed in order of importance
• Alternative actions must be developed
• The alternative must be evaluated against all the objectives
• The alternative that is able to achieve all the objectives is the tentative decision
• The tentative decision is evaluated for more possible consequences
• The decisive actions are taken, and additional actions are taken to prevent any adverse
consequences from becoming problems and starting both systems (problem analysis and decision
making) all over again.

DECISION-MAKING STEPS

When in an organization and faced with a difficult decision, there are several steps one can take
to ensure the best possible solutions will be decided. These steps are put into seven effective
ways to go about this decision making process.

The first step- Outline your goal and outcome. This will enable decision makers to see exactly
what they are trying to accomplish and keep them on a specific path.

The second step- Gather data. This will help decision makers have actual evidence to help them
come up with a solution.

The third step- Brainstorm to develop alternatives. Coming up with more than one solution
enables you to see which one can actually work.

The fourth step- List pros and cons of each alternative. With the list of pros and cons, you can
eliminate the solutions that have more cons then pros, making your decision easier.

The fifth step - Make the decision. Once you analyze each solution, you should pick the one that
has many pros, and the one that everyone agrees with.

The sixth step-Immediately take action. Once the decision is picked, you should implement it
right away.

The seventh step - Learn from, and reflect on the decision making. This step allows you to see
what you did right and wrong when coming up, and putting the decision to use

Advantages of Group Decisions:

 Group decisions help to combine individual strengths of the group members and hence
has a set of varied skill sets applied in the decision making process.
 Individual opinions can be biased or affected with pre-conceives notions are restricted
perspectives, group decision help to get a broader perspective owing to differences of
perception between individual in the group.
 A group decision always means enhanced collective understanding of the course of action
to be taken after the decision is taken.
 A group decision gains greater group commitment since everyone has his/her share in the
decision making.
  Group decisions imbibe a strong sense of team spirit amongst the group members and
help the group to think together in terms of success as well as failure.

CONFLICTS INVOLVED IN DECISION MAKING PROCESS

Conflict is the perception or feeling by one party, individual or group that the other party is
hindering the first party from achieving a goal.

Conflict can be a disagreement, the presence of tension, or some other difficulty between two or
more parties. It can be public or private.
NATURE OF CONFLICT:
Conflict can be interpersonal, inter group, or between organizations that is Inter-organizational.
1. Individual Level Conflict:
(a)Intra Individual Conflict: Created due to ungratified needs. There are four types of such
conflicts:
‡
Approach-Approach conflict: W hen an individual is attracted to two equally appealing
alternatives it is called an approach- approach conflict for e.g. reading a book or going for a
picnic.
‡
Approach-Avoidance conflict: Is a condition in which an individual is attracted as well as
repelled to some event, object or situation, such a conflict is called an approach avoidance
conflict. Example, you may have an excellent job offer in a country you are not willing to go to.
‡
Avoidance- Avoidance conflict: W hen an individual is repelled to two
equally unappealing alternatives it is called as avoidance-avoidance
conflict.
‡
Multiple Conflict: They are a combination of the above types of conflicts.
b) InterpersonalConflict:Which involves two or more than two individuals.
Some of the reasons for interpersonal conflict could be: personality differences, perceptions,
clashes of values and interests, power and status differences and scarce resources.
2. GROUP CONFLICT
a) Intergroup conflict
Some of the reasons for intergroup conflict are-
Incompatible goals, Task interdependence, Resource allocation, Competitive incentive and
reward system, Line staff conflicts and Differences in values or perception.

b) Intra organizational conflict: Three kinds of internal strains can be identified:

(1) The horizontal strain, the competition between different functional subsystems;
(2) vertical strain, the competition between various levels in the hierarchy for power, privilege or
reward;
(3) line and staff conflict
c) Inter organizational conflict: Stagner and Rosen have identified five types of inter
organizational conflict:
(1) Management government,
(2) Inter management,
(3) Inter union,
(4) Union- government, and
(5) Union- management.

Conflict Management Styles

Avoiding -deliberate decision to take no action on a conflict or to stay out of a conflict
Accommodating -concern that the other party’s goals be met but relatively unconcerned with
getting own way
Competing -satisfying own interests; willing to do so at other party’s expense.
Compromising -each party gives up something to reach a solution.
Collaborating -arriving at a solution agreeable to all through open and thorough discussion.

STAKEHOLDER IN DECISION MAKING IN A CORPORATE

HIERARCHY
A stakeholder is any individual or organization that is affected by the activities of a business.
They may have a direct or indirect interest in the business, and may be in contact with the
business on a daily basis, or may just occasionally.

STAKEHOLDER HEIRARCHY:
Government- Shareholders/owners- Board of Directors- Executives- Management- Customers-
Employees- Suppliers- Community

Government
The government represents the most formal and powerful stakeholder. This stakeholder
embodies the laws and regulations that guard the interests of the public and business. The laws
provide the guidelines for conducting business. In addition, there are a wide variety of regulatory
agencies at the federal, state, and local levels aimed at controlling the business practices in
particular industries. Whether the entity is a publicly owned business, a family business, the Girl
Scouts of America, the National Football League, or a private church organization, various laws
and regulations ensure that the public interests are protected and served.

As a stakeholder, their requirements and interests supersede all others. It does not matter that the
customer may require a bribe to do business, or that that they want an unfair price, or that they
require you to act unethically and illegally and dump toxic wastes. The government(s)
requirements will take precedence, under the penalty of law for noncompliance.

Shareholders

Shareholders are the owners of the business. Their shares represent capital invested in the
organization with an expectation for an equitable return. Their goals are typically financial, long-
term growth in equity or short-term income through dividends, but can be related to other things
such as greater societal enhancement, environmental protection, etc.

Like putting money in the bank or another investment, they expect to get a fair profit over the
inflation rate. Shareholders essentially lend their capital to a group managing a business entity in
exchange for the chance to earn additional money. The management group is responsible to the
shareholders for the business results. If the executive management group does not achieve
shareholder financial performance goals, they will either be replaced or the investors will
withdraw their capital and invest it elsewhere. An entity without a sound capital base will
eventually be crippled.

Board Directors/Executive Management/Management

The executive management stakeholders are those responsible for the operations and results of
the entity. They may be the “partners” who contributed and own all the capital of the entity and
run the business. They could also consist of an elected board of directors responsible to all the
owners and the executive management team in charge of overseeing daily business operations.

As a matter of law, executive managers of a publicly held corporation have a fiduciary

responsibility to the shareholders for all operating decisions made. Their decisions could be
determined to be unlawful/fraudulent, and they may be liable for their actions within the context
of the law. They must always balance the (conflicting) interests of various stakeholder groups
when determining the course of action for the organization. All management may be liable for
their actions and/or inactions.

Customers

Customers are typically a heterogeneous group. Segmentation schemes allow us to analyze them
as distinct groups for the purposes of gaining insights into their situations, problems, and needs.

In some cases, such as in large-scale contracting businesses (e.g., aircraft or information

systems), many of the customer requirements are specifically defined or the customer provides
enough information to allow the provider to define requirements on their behalf. However, there
are many different groups within the customer organization (such as technical experts, business
management, contract management, etc.) with unique, and sometimes conflicting, requirements.
In other types of businesses, the provider has to generalize the requirements of the entire
marketplace in order to build the right product to put on the shelf. And in either of these
situations, customers may not really know exactly what they want or what is available to help
them with their problems/opportunities.

But one thing is certain—customers will generally demand a quality product at a competitive
price. Some feel that customers want the moon at half the cost of providing it. If a business tries
to meet this requirement, that is certainly not in alignment with the requirements of our
shareholder stakeholders. Selling below cost is like committing economic suicide, unless the
organization is “buying” enough future business to warrant a short-term loss.

We need to listen to customers to understand their requirements fully and consider those in light
of what our competition is doing in the marketplace. This allows us to determine responsibly
what customer requirements we will choose to pursue. And we should choose to pursue only
those that meet the requirements of other critical stakeholders.

Standards Bodies/Professional Associations

A potential stakeholder constituency is made up of the various organizations that establish
technical and business practice standards. Though their requirements are similar in type to the
governmental regulators, these organizations do not have the power of law to enforce their point
of view. However, many of these organizations wield a great deal of influence both in the
marketplace and in the area of regulation—it would be a mistake to ignore their requirements,
unless you choose to deliberately go with a nonstandard approach to your product or service.
Then, that’s a business decision. It has its potential risks and rewards.

A standards body stakeholder may generate requirements for the output of your business such as
packaging/labeling, purity, “recyclability,” percent parts manufactured domestically, etc. In
addition, they may address the processes within your company, such as the implementation of
your quality management system, hiring and recruitment processes, and so on. They may have
the power of law, or it may be more of an informal policy-setting body. As always, it depends.

Employees

This stakeholder group includes all ranks of employees below the executive management level—
upper middle management, middle management, supervisors, and the individual contributors. At
the heart of all employee requirements are a safe workplace and financial security, but other
needs exist among the groups.

Some employees want the opportunity for career growth and advancement. Others want a work
situation where they can use their intellect and creativity. Others may simply want a no
demanding set of tasks to do before they head home each day. Each set of needs is as different as
the individual doing the job. Global assumptions such as one that assumes that everyone wants to
be a team player will only lead to a population of unsatisfied employees. Organizations need to
listen carefully to all their employees.

Suppliers

Suppliers, whether internal or external, are also a key stakeholder group. As a business entity,
they need to achieve a profit margin that will allow them to remain in business. If we want to
promote a long-term arrangement with particular suppliers, we need to be aware of the impacts
of our decisions on their business. Our objective should not be to drive prices for their
materials/components so far down that they become unprofitable.

Supplier requirements typically include

• Clear/stable specifications for their products and services

• Stable demand (or accurately forecasted demand)
• Prices that enable a growth in their shareholders’ equity

A win-win collaboration with targeted suppliers helps to ensure that we have a stable inflow of
goods and services to meet the needs efficiently of our own process and business requirements.
It’s not just a nice theory; it’s a good business practice.

Community

The community stakeholders, although a less formal group, remain important through the
influence they can have on our businesses. The community can choose to support your business
or, if they do not agree with the ways in which your operations are run, bring it to the attention of
the greater public.

Their interests primarily lie in community and environmental safety, jobs for the members of the
local community, and cooperation with community interests. Community members can be a
nuisance or they can be a base of support, depending upon the effort put into establishing that
relationship.

ETHICAL DILEMMAS
There are situations when there is not simple choice between right or wrong. Dilemmas are
complex when managers have no clear guidelines either in law or in religion. Managers are in
fix, predicament, mess, perplexity. Choice one is faced is clearly of the “right versus right sort”.

An ethical dilemma is a complex situation that will often involve an apparent mental conflict
between imperatives, in which to obey one would result in transgressing another. In other words,
ethical dilemmas are complex judgments on the balance between the economic performance and
social performance of an organization.
An ethical dilemma exists when one is faced with having to make a choice among following
alternatives –

a) Significant value conflicts among different interests,

b) Real alternatives that are equally justifiable, &
c) Significant consequences on “stakeholders” in the situation

Four common Ethical Dilemmas:-

 Truth versus loyalty

 Individual versus community
 Short-term versus long- term
 Justice versus mercy

Ethical dilemmas occur in relationships with- Superiors, subordinates, customers, competitors,

suppliers, and regulators.

GLOBALIZATION AND ITS STRATEGIC ALLIANCE:

Globalization occurs when an organization extends its activities to other parts of the world,
actively participates in other markets, and competes against organizations located in other
countries.

Implications for organizational behavior:-

a) Requires new structures and different forms of communication to assist the organizations
global reach.
 b) Creates new career opportunities and potentially brings in new knowledge to improve the
organizations competitive advantage.
c) Emphasizes the need to recognize the contingencies of effective OB practices in different
cultures.

Alliances are a big part of the global competition due to globalization. They are critical to win on
a global basis. The global marketplace has spawned new strategic approaches in many industries.
The forging of what have become known as strategic alliances. Alliances are associations to
further the common interest of members or various corporate agreements covering a wide gamut
of functions, ranging from component sourcing through research and development to production
and marketing. Examples include:

 IBM, Siemens, and Toshiba’s cooperating to develop a new generation of memory chips
 DuPont and Sony working jointly to develop optical memory storage products.
 General Motors and Hitachi’s working together to develop electronics components for
automobiles.

So all these companies have worked on strategic alliances which links specific facets of the
businesses of two or more firms. At its core, this link is a trading partnership that enhances the
effectiveness of the competitive strategies of the participating firms by providing for the
mutually beneficial trade of technologies, skills or products based upon them.

Types of strategic alliances:

1. Contractual – Licensing, Franchising, Joint R&D

2. Equity – Joint venture, Purchase of equity share, equity swap

Pros and Cons of strategic alliances:

Pros:-

 Sharing costs/risks
 Developing new technologies
 Capturing economies of scale
 Access to new markets/technologies
 Organizational learning

Cons:-

 Possible opportunistic behavior of partner

 Searching costs
 Coordination costs
 Monitoring costs
  Technology/information leakage

Reasons for strategic alliances:

 Gain access to a new or restricted market

 Develop new goods or services
 Facilitate new market entry
 Share significant R&D investments
 Share risks and buffer against uncertainty
 Develop market power
 Gain access to complementary resources
 Build economies of scale
 Meet competitive challenges
 Learn new skills and capabilities
 Outsource for low costs and high quality output

IMPACT OF INFORMATIONAL TECHNOLOGY (IT) IN

ORGANIZATIONAL ENVIRONMENTS

IT ROLE:
1. IT's Role in Managing Organizational Change
(1.a) IT and Environment-Goals-Structure

Churchman (1968) defined environment as those factors which not only are outside the system's
control but which determine in part how the system performs. Uncertainty is the difference
between the amount of information required to perform the task and the amount of information
already possessed by the organization.

Proposition 1: Turbulent environment drives organizations to use IT for monitoring the

preferences of the environment.

System theorists have recognized the importance of "feedback" for the survival of the system
(Miller, 1955) and for maintaining a "steady state" or "homeostasis" (Katz and Kahn, 1966).
Organizations are purposive systems that learn of the impending threats by scanning. Scanning is
the process by which the organization acquires information for decision making. The modes
(surveillance and search) of scanning are primarily determined by the external environmental
stimuli and are determined by the magnitude and by the direction of the discrepancy between the
goal and its realization. While surveillance is useful for information-gathering process, search is
oriented toward finding a satisfactory solution to a specific problem. Complex systems require
complex controllers (Ashby, 1956). IT will provide the "complex controller" to the increasingly
complex organization. The information systems of an organization need to evolve to remain
consistent with the changing organizational structure (Daniel, 1961). Referring to the obscurity
of causal laws of turbulence, Aldrich argued that scanning could provide the firm with the
desired "competitive edge."

Proposition 2: Turbulent environment drives organizations to use IT for translating the

information on environmental preferences into goals.

Continuously changing environment requires organizations to continuously reassess their goals

(Thompson and McEwen, 1958). Effective structuring requires a consistency among the design
parameters and contingency factors (Mintzberg, 1979). Maniha and Perrow (1965) have
demonstrated that organizations' goals can be generated by external forces, such as other groups
seeking to use the organization to further their own ends.

Proposition 3: Turbulent environment drives organizations to use IT to align their structure

with environmental preferences.

The very efforts of the organization to maintain a constant external environment produce
changes in organizational structure (Katz and Kahn, 1966). Scott (1987) argued that
organizational structure and goals are driven by the preferences in the environment. The structure
is determined by the information- processing capacity requirements of the organization
(Galbraith, 1977) which in turn are governed by the IT being used. Aldrich (1972), Perrow
(1967), Walker (1962) and Woodward (1958, 1965) have attributed structural differences to the
organization's technology. Mintzberg (1979) had suggested that the organization's environment
and technology are the independent (contingency) variables that determine the structural
variables of the organization.
Fowles (1987), in his narrative on the history of organizational communications technologies
contends that the phenomenal expansion of organizations can be largely attributed to advances in
the technologies of organizational communication. Yates (1987) argued that in absence of
technological communication organizations could have evolved differently. Preliminary
econometric analyses of the overall U.S. economy for the period 1975-1985 further confirms that
the increased use of IT is correlated with decreases in firm size and vertical integration
(Brynjolfsson, et al., 1989).

(1.b) IT and Organic Structure

Proposition 4: Turbulent environment drives organizations to make more use of IT for

increasing their "organic" characteristics.

"Organic" firms are better equipped to sustain themselves in turbulent environment (Burns and
Stalker, 1961). A dynamic environment will drive the structure to an organic state despite other
forces (Mintzberg, 1979); the more complex the environment, the more decentralized the
structure. Introduction of IT (automation) at the "operating core" level transforms a bureaucratic
administrative structure into an organic one (Mintzberg, 1979: 265). Effectively, automation of
routine tasks (Woodward, 1965) eliminates the source of many of the social conflicts throughout
the organization.

Law of requisite variety (Ashby, 1956) implies that the rate of change of organizational systems
must correspond to the rate of change of environmental systems, i.e., organizations with complex
environmental interactions would develop complex structures (Becker and Neuhauser, 1975)
networks. Adhocracy is suitable for a dynamic and complex environment, when the firm has
sophisticated technical systems and the focus is upon consistently offering differentiated
products (Mintzberg, 1979) for retaining the customers. Future organizations would be
"networks" (Keen, 1991) characterized by adhocracies with flexible systems of projects and
teams (Drucker, 1988; Malone and Rockart, 1993; Mintzberg, 1979) brought together quickly to
accomplish specific tasks (Ramstrom, 1974; Rockart & Short, 1989; Toffler, 1985). Some
existing organizations have already "farmed out" their operations by establishing them as
separate organizations or contracting them out to other organizations (Mintzberg, 1979).

Proposition 4a: Turbulent environment drives organizations to use IT for empowering

workers at all levels.

Growing availability of telecommunications has offered technologies like distributed systems

and client-server architecture (Keen, 1991) that facilitate the process of empowerment of the
lower levels (Mintzberg, 1979). In the "informated" (Zuboff, 1988) organization, workers would
be "empowered" by virtue of access to necessary information to perform higher-level tasks.
Ramstrom (1974) has argued that tactical decisions relating to "soft" information would be
delegated to the "grass-roots" where there is easy access to relevant information concerning the
immediate environment, at the same time providing these levels with the information generated
within the system by means of "cheap" (with internal coordination costs becoming negligible)
internal information systems.
Proposition 4b: Turbulent environment drives organizations to use IT for increasing the spans
of control.

Information technologies, by facilitating the standardization of coordination (Malone and

Crowston, 1991), would facilitate larger spans of control or work units (Mintzberg, 1979: 139)
which would be characterized by extensive lateral communication and self- contained authority
structures.

Proposition 4c: Turbulent environment drives organizations to use IT for increasing lateral
communications.

Selective use of lateral decision processes for situations involving task uncertainty increase the
information processing capacity of the organization (Galbraith, 1973; Ramstrom (1974).
Bringing the points of decision down to the points of action (where the information originates)
reduces the information overload on the managers. Since specification of "procedures" in
complex situations (Becker and Neuhauser; 1975) creates inefficiencies, organizations in
turbulent environments would use more IT resource for delegating the decision-making to
workers ("empowerment"). Increased use of groupware (Wilke, 1993) for lateral coordination
will spell the demise of middle-management (Bluementhal, 1963; Leavitt and Whisler, 1958,
1970).

(1.c) IT and Differentiation-Integration

Proposition 5: Turbulent environment drives organizations to reduce their "dimensions" by

focusing on core competencies by leveraging their use of IT.

Proposition 5a: Turbulent environment drives organizations to use IT to reduce

differentiation and integration to focus on increased specialization.

Organizations structure themselves to minimize coordination costs (Galbraith, 1970) and group
together similar activities to achieve the benefits of process specialization (March and Simon,
1958). Environmental uncertainty or "task predictability" is the basic independent variable
influencing the design of the organization (Galbraith, 1970; Perrow, 1967; Thompson, 1967).
Faced with increased uncertainty, organizations can reduce the need for information processing
by decreasing the "diversity of outputs" (Galbraith, 1973). Reduced differentiation and
integration (Lawrence and Lorsch, 1967) of activities would decrease the coordination effort
involved thus reducing the information processing requirements. Reduced coordination costs
with IT would result in the substitution of IT for human coordination (Malone and Rockart,
1993). Greater specialization would be achieved by focusing on few core competencies.

2. IT's Role in Managing Organizational Interdependencies

Proposition 6: Turbulent environment drives organizations to actively seek

interorganizational (interfirm) relations to leverage their core competencies.
Cooperation, especially in the international context, will be necessary to gain a competitive
advantage in the future (IBM, 1990; Cummings, 1980). To survive in an increasingly
competitive environment, firms would form alliances that would bring together their core
competencies to create the "best of all" products (Byrne, 1993; Drucker, 1988).

Proposition 6a: Turbulent environment drives organizations to reduce environmental

complexity and uncertainty by seeking interdependencies (complex relationships) with other
organizations in the environment.

Proposition 6b: Turbulent environment drives organizations to use more IT-effort to establish
coordinating mechanisms with other firms.

To survive in the fast-changing environment the "adaptive organization" would be more like a
shifting "constellation" (Mintzberg, 1979; Toffler, 1985) that has [IT] "linkages" (Pinfield,
Watzke and Webb, 1974) with independent and semi- autonomous organizations. Use of
interorganizational linkages such as EDI (electronic data interchange) would enable new forms
of organizations and reduce the coordination costs of increasingly market-driven organizations
(Malone and Crowston, 1991). Increasingly, electronic linkages are becoming the necessary
condition of doing businesses with larger firms (Keen, 1991).
Using an analogy to the study of community chests conducted by Litwak and Hylton (1962), we
observe that in the increasingly global competition, the firms are competing for the common
customers' "fund" and the increase in one firm's revenue would come at the expense of other
firm's loss [of customers]. Coordination, being a function of interdependency, should grow in
periods of increased competition for "funds." (For a typology of interorganizational
configurations based upon interorganizational control, see Lehman, 1975.)

3. The IT Paradox
Proposition 7: Increasingly turbulent environment would feed the need for further [and
greater] advancements in IT which would further increase turbulence.

Business needs are incessantly driving the demands for increased capabilities of IT. In turn,
increasingly advanced IT is being utilized in more and more sophisticated ways by the
businesses to outdo competition (Rockart & Short, 1989). IT, which is being deployed as a
solution to the increased complexity and uncertainty of the environment, has paradoxically
contributed to the situation by "compressing time and distance." In absence of the present day
advances in IT, would we be talking of globalization or time-based competition? Perhaps, not.
The pace of complexity is increasing fast. Hopefully, the advances in technology would be able
to keep up with the environmental changes.

STRESS IN ORGANIZATION:

Job stress in organizations is widespread. About half of all American workers feel the pressures
of job-related stress. Extensive research shows that excessive job stress can adversely affect the
emotional and physical health of workers. The result is decreased productivity, less satisfied, and
less healthy workers. This paper will first discuss the symptoms and causes of stress, and then
explore ways in which managers might reduce stress in themselves and their subordinates.
Definition of Stress

Stress is an imprecise term. It is usually defined in terms of the internal and external conditions
that create stressful situations, and the symptoms that people experience when they are stressed.
McGrath (1976) proposed a definition based on the conditions necessary for stress.

So there is a potential for stress when an environmental situation is perceived as presenting a

demand that threatens to exceed the person's capabilities and resources for meeting it, under
conditions where he expects a substantial differential in the rewards and costs from meeting the
demand versus not meeting it.

McGrath's definition implies that the degree of stress is correlated with a person perceived
inability to deal with an environmental demand. This would lead to the conclusion that a person's
level of stress depends on their self-perceived abilities and self-confidence. Stress is correlated
with a person's fear of failure.

Short-term stress has served a useful purpose in our survival. Long-term stress, however,
involves increasingly higher levels of prolonged and uninterrupted stress. The body adapts to the
stress by gradually adjusting its baseline to higher and higher levels. For example, workers in
stressful jobs often show an increased "resting" heart rate. Pelletier (1977) believes that the
deleterious effects of stress are created only by unrelieved long-term stress. Albrecht (1979) also
believes that the effects of stress are cumulative in nature. Ulcers do not just happen overnight in
a high stress situation; they are generally the result of long extended exposure to stress. "The
health breakdown is simply the logical conclusion of a self-induced disease development over a
period of 10 to 20 years."

Excessive job-related stress is not a small or isolated problem. Over one-third of all American
workers thought about quitting their jobs in 1990. One-third believes they will burn-out in the
near future, and one-third feel that job stress is the single greatest source of stress in their lives.
Nearly three-fourths of all workers feel that job stress lowers their productivity, and they
experience health problems as a consequence. (Lawless, 1991, 1992) Furthermore, this is not
exclusively a United States phenomenon. A Japanese poll conducted by the Health and Welfare
Ministry in 1988 indicated that 45 percent of workers felt stress from their jobs. (Asahi News
Service, 1990)

Recent studies have found evidence of dangerous physical changes attributed to prolonged stress.
One New York study reported a twenty gram increase in heart muscles of those suffering from
job stress. There was a significant "thickening of the heart's left ventricle, or chamber, a
condition that often precedes coronary heart disease and heart attacks." (Pieper, C., 1990) Omni
magazine (March, 1991) wrote about a series of experiments with rats to examine the
physiological effects of prolonged stress. The researchers found that there was actually a loss of
neurons in the hippocampus section of their brains. The article concluded with a warning that
there is some evidence of a similar neuron loss occurs in humans.

Many researchers have studied the effects of stress on performance. McGrath (1978) reported
that mild to moderate amounts of stress enables people to perform some tasks more effectively.
The rationale is that improved performance can be attributed to increased arousal. However, if
the stressor continues, it eventually takes its toll, and results in decreased performance and
deleterious health consequences. Furthermore, workers are aware of the toll that stress has had
on their own performances. Half of all workers say that job stress reduces their productivity.
(Lawless, 1992)

Causes of Stress

There are many aspects of organizational life that can become external stressors. These include
issues of structure, management's use of authority, monotony, a lack of opportunity for
advancement, excessive responsibilities, ambiguous demands, value conflicts, and unrealistic
work loads. A person's non-working life (e.g., family, friends, health, and financial situations)
can also contain stressors that negatively impact job performance.

Adverse working conditions, such as excessive noise, extreme temperatures, or overcrowding,

can be a source of job-related stress. Reitz (1987) reports that workers on "swing shifts"
experience more stress than other workers. Orth-Gomer (1986) concludes that when three shifts
are used to provide around-the-clock production, major disturbances in people may be
unavoidable. One source of environmental stress ignored in the organizational literature is non-
natural electromagnetic radiation. Becker (1990) reports that the two most prominent effects of
electromagnetic radiation are stress and cancers. Modern offices are filled with electronic
devices that produce high levels of radiation. These include computers, video monitors,
typewriters, fluorescent lights, clocks, copying machines, faxes, electric pencil sharpeners, and a
host of other electronic devices. Human sensitivity to electromagnetic fields is well-documented,
and the design of future office equipment will most likely involve a consideration of emitted
radiation.

Arnold and Feldman (1986) emphasize the deleterious effects of role ambiguity, conflict,
overload and underload. Role ambiguity is often the result of mergers, acquisitions and
restructuring, where employees are unsure of their new job responsibilities. Role conflict has
been categorized into two types: intersender and intrasender. (Kahn, et al., 1964) Intersender role
conflict can occur when worker's perceive that two different sources are generating incompatible
demands or expectations. Intrasender role conflict can arise when worker's perceive conflicting
demands from the same source. Overload is frequently created by excessive time pressures,
where stress increases as a deadline approaches, and then rapidly subsides. Underload is the
result of an insufficient quantity, or an inadequate variety of work. Both overload and underload
can result in low self-esteem and stress related symptoms, however, underload has also been
associated with passivity and general feelings of apathy. (Katz and Kahn, 1978)

Poor interpersonal relationships are also a common source of stress in organizations. Arnold and
Feldman (1986) cite three types of interpersonal relationships that can evoke a stress reaction: 1)
too much prolonged contact with other people, 2) too much contact with people from other
departments, and 3) an unfriendly or hostile organizational climate.

Lawless (1991) identified the five most common causes of worker stress: 1) too much rigidity in
how to do a job, 2) substantial cuts in employee benefits, 3) a merger, acquisition, or change of
ownership, 4) requiring frequent overtime, and 5) reducing the size of the work force. Over forty
percent of the work force experienced one or more stress-related illnesses as a result of these five
stressors. Single or divorced employees, union employees, women, and hourly workers reported
greater stress levels, and a higher likelihood of "burning out". In a follow-up study, Lawless
(1992) found similar results except that there was no significant difference between married and
unmarried workers. However single women with children were more likely to burn out than
married women with children. "Single parenthood compounds the stress women face in juggling
work and child care responsibilities, especially when overtime hours are required."

Managing Stress

Mangers of organizations have a dual perspective of stress. They need to be aware of their own
stress levels, as well as those of their subordinates. Most of the literature focuses on ways of
reducing stress. However, a more appropriate approach might be to examine ways of optimizing
stress. The role of management becomes one of maintaining an appropriate level of stress by
providing an optimal environment, and "by doing a good job in areas such as performance
planning, role analysis, work redesign/job enrichment, continuing feedback, ecological
considerations, and interpersonal skills training."

Establishing one's priorities (i.e., value clarification) is an important step in the reduction of
stress. The demands of many managerial positions cause the neglect of other areas of one's life,
such as family, friends, recreation, and religion. This neglect creates stress, which in turn affects
job performance and health. Value clarification is linked to time management, since we generally
allocate our time according to our priorities. By setting personal priorities, managers and
subordinates can reduce this source of stress. It is typically the first step in any stress reduction
program.

Many sources of stress in organizations cannot be changed. These might include situations like a
prolonged recessionary period, new competitors, or an unanticipated crisis. Organizational
members generally have little control over these kinds of stressors, and they can create extended
periods of high-stress situations. People who adjust to these stressors generally use a form of
perceptual adaptation, where they modify the way in which they perceive the situation.

Job engineering and job redesign are recent concepts that attempt to minimize job-related stress.
Job engineering takes into account the values and needs of the worker, as well as the production
objectives of the organization. (Albrecht, 1979) It involves a six-step cyclical process, beginning
with defining the job objectives. This initial step makes statements about "accomplishing
something of recognized value. The second step is to define the job conditions. This step
specifies the physical, social, and psychological characteristics of the job. The third step is to
define the job processes, equipment, and materials. Processes are often presented in a flow chart
to show the sequence of operations. The fourth step is to re-evaluate the design from the
perspective of the worker, the goal being to achieve a balance between job satisfaction and
performance. The fifth step is to test the job design. Employees often experience problems not
anticipated by job engineers. The evaluation should look at the "total combination of person,
equipment, materials, processes, and surroundings as an integrated whole, and you must measure
both productivity and employee satisfaction before you can say the job is well designed." (p.
162) The sixth step involves the ongoing re-evaluation and redesign of the job. Employee
attitudes and values change, and new technology provide alternatives to the status quo. Job
engineering attempts to be sensitive to these changes, and to modify job descriptions as
necessary.

Effects of stress:

Subjective Effects: Anxiety, Aggression, Bad Temper

Behavioral Effects: Accident Proneness, Excitability, Drug Use, Cognitive Effect

Cognitive Effects: Decision Making, Forgetfulness, Mental Blocks

Physiological Effects: Increased Blood pressure, Increased Heart Rate, Sweat

Organizational Effects: Absenteeism, Poor productivity, job satisfaction

CONCLUSION:

Organization Behavior keeps on changing with the time. A lot of factors come into play the
moment the organization thinks that the particular problem has been solved a new problem
comes into picture. So the organization should always be on its toe to solve any problem
occurred due to the dynamic environment. Because it affects employees which in turn will affect
the productivity and efficiency of the organization.

The basic understanding of the present and future scenario should be there, so to chart out well
planned guidelines.

BIBLIOGRAPHY:
www.oppapers.com

www.123helpme.com
www.hubpages.com

www.books.google.co.in

www.studenten.samenvattingen.com

www.slideshare.net

www.kmbook.com

www.jstor.org