1
SUMMARY
ORGANIZATIONAL
PSYCHOLOGY
IBP year 1 | semester 2 | block 3
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Contents
Chapter 1: introduction to organizational psychology......................................................................................5
What is organizational behavior?..................................................................................................................5
Challenges for OB..........................................................................................................................................6
Challenge 1: the changing social and cultural environment..........................................................................7
Challenge 2: the evolving global environment..............................................................................................8
Challenge 3: advancing information technology...........................................................................................8
Challenge 4: shifting work and employment relationships...........................................................................9
Chapter 3: values, attitudes, and moods and emotions......................................................................................9
Values, attitudes, and moods and emotions...................................................................................................9
Job satisfaction.............................................................................................................................................11
Theories of job satisfaction..........................................................................................................................11
Potential consequences of job satisfaction..................................................................................................12
Organizational commitment........................................................................................................................13
Chapter 4: perception, attribution and the management of diversity..............................................................13
The nature of perception..............................................................................................................................14
Characteristics of the perceiver....................................................................................................................14
Characteristics of the target and situation....................................................................................................15
Biases and problems in person perception..................................................................................................16
Attribution theory.........................................................................................................................................17
Effectively managing a diverse workforce..................................................................................................17
Chapter 6: the nature of work motivation........................................................................................................19
What is work motivation?............................................................................................................................19
Need theory..................................................................................................................................................19
Expectancy theory........................................................................................................................................20
Equity theory................................................................................................................................................21
Organizational justice theory.......................................................................................................................21
Chapter 7: creating a motivating work setting.................................................................................................22
Job design: early approaches.......................................................................................................................22
Job design: the job characteristics model....................................................................................................23
Job design: the social information processing model..................................................................................24
Job design models summarized...................................................................................................................25
Organizational objectives.............................................................................................................................25
Goal setting..................................................................................................................................................25
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Goal setting and job design as motivation tools..........................................................................................26
Chapter 8: pay, careers and changing employment relationships...................................................................26
Psychological contracts................................................................................................................................26
Performance appraisal..................................................................................................................................27
Pay and the employment relation.................................................................................................................29
Careers..........................................................................................................................................................30
Chapter 9: managing stress and work-life balance..........................................................................................32
The nature of stress......................................................................................................................................32
Sources of stress...........................................................................................................................................33
Coping with stress........................................................................................................................................34
Chapter 10: the nature of work groups and teams...........................................................................................36
Introduction to groups..................................................................................................................................36
Characteristics of work groups....................................................................................................................37
How groups control their members: roles and rules....................................................................................38
How groups control their members: group norms.......................................................................................39
Socialization: how group members learn roles, rules and norms................................................................39
Chapter 11: effective work groups and teams.................................................................................................40
Process losses, process gains, and group effectiveness...............................................................................40
Social loafing: a problem in group motivation and performance................................................................41
How task characteristics affect group performance....................................................................................41
Group cohesiveness and performance.........................................................................................................42
Important organizational groups..................................................................................................................43
Chapter 12: leaders and leadership..................................................................................................................44
Introduction to leadership............................................................................................................................44
Early approaches to leadership....................................................................................................................44
Fiedler’s contingency theory of leadership.................................................................................................45
Contemporary perspectives on leadership...................................................................................................46
Does leadership always matter in organizations?........................................................................................47
New topics in leadership research...............................................................................................................48
Chapter 13: power, politics, conflict and negotiation......................................................................................49
The nature of power and politics.................................................................................................................49
Sources of individual power........................................................................................................................49
Sources of functional and divisional power................................................................................................50
Organizational politics: the use of power....................................................................................................50
What is organizational conflict?..................................................................................................................51
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Pondy’s model of organizational conflict....................................................................................................52
Negotiation: resolving conflict....................................................................................................................53
Chapter 15: decision making and organizational learning..............................................................................54
Types of decisions........................................................................................................................................54
Ethical decision making...............................................................................................................................54
The decision-making process.......................................................................................................................54
Sources of error in decision making............................................................................................................55
Group decision making................................................................................................................................56
Group decision-making techniques.............................................................................................................57
Organizational learning................................................................................................................................58
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Chapter 1: introduction to organizational psychology
What is organizational behavior?
Organization: collection of people who work together and coordinate their actions to achieve wide variety
of goals (individual and organization as whole). Exist to provide goods/services to people. Amount and
quality are products of behavior and performance of employees, managers and highly skilled employees in
sales or research and development and employees who actually produce.
The nature of organizational behavior
Organizational behavior (OB): study of the many factors that have impact on how people and groups act,
think, feel and respond to work and organizations and how organizations respond to environment. Often
intuition and common sense are wrong and we don’t really understand why people act and react the way
they do. Beliefs are either false or true only under very specific conditions, applying these principles can
have negative consequences for employees and organizations. Guidelines that help people at work
understand and appreciate the many forces that affect behavior in organizations. Make the right decisions
about how to behave and work with other people. Tools: concepts and theories to correctly understand,
describe and analyze the characteristics of individuals, groups, work situations and the organization itself
affect how members feel about and act within the organization.
Levels of OB
Individual, group and organization. Way in which characteristics of individuals affect how well people do
their jobs, whether they like it, whether they get along etc. Group: two or more people who interact to meet
goals. Team: group in which members work together intensively and develop routines to achieve common
group goal. Virtual team: group in which members work together intensively via electronic means and
who may never actually meet. Number of members, type and diversity of members, tasks and attractiveness
of group influence behavior of the group and individuals. Values and beliefs influence how people, groups
and managers interact with each other and people outside the organization. Culture also shapes and controls
attitudes and behavior of people and groups in organization and desire to work toward goals. Structure
controls how people and groups cooperate and interact to achieve goals.
OB and management
Understand behavior, learn to use and apply concepts, theories and techniques to improve/enhance/change
behaviors so that everyone can better achieve goals, appreciates work situation and how to behave to
achieve own goals. Managers: direct and supervise activities of employee(s). Problem of understanding
behavior of subordinates and responding appropriately. Top-management teams: group of high-ranking
executives who jointly work to develop strategies that allow organization to achieve goals. A manager who
understands how characteristics affect and shape work attitudes can begin to see whether changing
one/more of the characteristics might increase effectiveness. Organizational effectiveness: ability of
organization to achieve goals. Tools:
Raise employee’s self-esteem or beliefs about ability to accomplish certain task to increase
productivity or job satisfaction
Change reward system to change employees’ beliefs about extend to which rewards depend on
performance
Change design of job or the rules and procedures to reduce costs, make it more enjoyable or easy
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Challenge: how to encourage members to work efficiently for own benefit, of the groups and organization.
Managerial functions
Four principal functions/duties of management are planning, organizing, leading and controlling human,
financial, material and other resources to increase effectiveness.
Planning
Planning; establish strategy – how best to allocate and use resources to achieve organizational goals.
Considerable risks, knowledge of OB can help. Reveals how decisions get made, how politics and conflict
affect planning process, way in which group decision making affects planning and biases that can influence
decisions. Theories and concepts show how composition of organization’s top-management team can affect
planning process.
Organizing
Organizing: establish structure of work relationships that determines how members will cooperate and act
jointly to achieve goals. Dividing into groups, teams or departments.
Leading
Leading: encourage workers to do a good job, coordinate individuals and groups. Self-managed teams:
groups of employees who are given both authority and responsibility to manage important aspects of own
work behaviors. Managers are coaches and mentors.
Controlling
Controlling: monitor and evaluate individual, group and organizational performance to see whether
organizational goals are being achieved. Action to maintain and improve performance or corrective action.
Evaluate. OB to understand and accurately diagnose work situations to pinpoint where corrective may be
needed.
Managerial roles
Role: set of work behaviors/tasks a person is expected to perform because of position.
Managerial skills
Skill: ability to act in a way that allows person to perform well in his/her role. Conceptual skills: analyze
and diagnose situation and distinguish between cause and effect. Human skills: understand, work with,
lead and control behaviors of other people and groups. Technical skills: job-specific knowledge and
techniques manager requires to perform organizational role. Depend on organization and position.
Challenges for OB
Changing pressures/forces in social and cultural, global, technological and work environments. Open
system: organization takes in resources from external environment and converts/transforms them into
goods/services that are sent back to the environment, where customers buy them. Input stage: acquire
resources, create set of organizational behaviors/procedures that allow employees to identify and purchase
high quality resources at favorable price. Organizational procedure: behavioral rule/routine employee
follows to perform some task in most effective way. Conversion stage: transforms inputs into outputs of
finished goods and services. Develop set of behaviors and procedures that results in high-quality goods and
services produced at lowest possible cost. Output stage: releases finished goods and services to its external
environment. Develop set of behaviors and procedures that attract customers and let them believe in value
