Management and Organisational Behaviour

This market leading text guides students to a thorough understanding of organisational behaviour and relates this to effective management practice. It is an invaluable resource, which provides a clear and insightful introduction to management studies and acts as a comprehensive point of reference thereafter.

MANAGEMENT AND ORGANISATIONAL BEHAVIOUR LAURIE J. MULLINS

SEVENTH EDITION

Additional student support at www.booksites.net/mullins

MANAGEMENT AND ORGANISATIONAL BEHAVIOUR

Visit the Management and Organisational Behaviour, Seventh Edition Companion Website at www.booksites.net/mullins to find valuable student learning material including: ■ ■

■ ■

Multiple choice and short answer questions to help test your learning Technology Solutions – short web articles which explore further the managerial implications of technology Weblinks to relevant sites on the web An online glossary to explain key terms

About the author Laurie J. Mullins was formerly principal lecturer at The Business School, University of Portsmouth. Before taking early retirement, Laurie specialised in managerial and organisational behaviour, and managing people at work, and was subject leader for the behavioural and human resource management group. Laurie had previous experience of business, local government and university administration and human resource management. For a numbr of years he was also a member of, and an instructor in, the Territorial Army. He has undertaken a range of consultancy work; served as a visiting selector for UNAIS and VSO; acted as advisor and tutor for a number of professional and educational bodies including UNISON Education; and served as an external examiner for university degree and postgraduate courses, and for professional organisations. Laurie has undertaken a year’s academic exchange in the Management Department, University of Wisconsin, USA, and a visiting fellowship at the School of Management, Royal Melbourne Institute of Technology (RMIT) University, Australia, and given invited lectures in The Netherlands and South Africa. Laurie is also author of Hospitality Mangement and Organisational Behaviour.

About the contributors Linda Hicks is a Chartered Occupational Psychologist who specialises in management development and coaching within her consultancy ‘Zest for Change’. David Preece is Professor of Technology Management and Organisation Studies in The Business School, University of Teesside.

Seventh Edition

MANAGEMENT AND ORGANISATIONAL BEHAVIOUR Laurie J. Mullins Formerly, Principal Lecturer The Business School University of Portsmouth

To Pamela And for Kerrie and Tracey, and Paul

Pearson Education Limited Edinburgh Gate Harlow Essex CM20 2JE England and Associated Companies throughout the world

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First published in 1985 in Great Britain under the Pitman imprint Fifth edition published in 1999 by Financial Times Pitman Publishing imprint Sixth edition 2002 Seventh edition 2005 © Laurie J Mullins 1985, 1989, 1993, 1996, 1999, 2002, 2005 © Chapter 9 Linda Hicks 1993, 1996, 1999, 2002, 2005 © Chapter 10 Linda Hicks 1999, 2002, 2005 © Chapter 17 David Preece 1999, 2002, 2005 The right of Laurie J Mullins to be identified as author of this work has been asserted by him in accordance with the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without either the prior written permission of the publisher, or a licence permitting restricted copying in the United Kingdom issued by the Copyright Licensing Agency Ltd, 90 Tottenham Court Road, London W1T 4LP. All trademarks used herein are the property of their respective owners. The use of any trademark in this text does not vest in the author or publisher any trademark ownership rights in such trademarks, nor does the use of such trademarks imply any affiliation with or endorsement of this book by such owners. ISBN 0 273 68876 6

British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library. Library of Congress Cataloging-in-Publication Data Mullins, Laurie J. Management and organisational behaviour / Laurie J. Mullins.--7th ed. p. cm Includes bibliographical references and index. ISBN 0–273–68876-6 (pbk.) 1. Organizational behavior. I. Title HD58.7.M85 2004 658--dc22 2004046919 10 9 8 7 6 5 4 3 2 09 08 07 06 05 Typeset by 30 in Stone Serif Printed and bound by Mateu-Cromo, Artes Graficas, Spain

The publisher’s policy is to use paper manufactured from sustainable forests.

CONTENTS IN BRIEF

Part 1 MANAGEMENT AND ORGANISATIONAL BEHAVIOUR 1 Introduction 2 The Nature of Organisational Behaviour 3 Approaches to Organisation and Management Part 2 THE ORGANISATIONAL SETTING 4 The Nature of Organisations 5 Organisational Goals, Strategy and Responsibilities Part 3 THE ROLE OF THE MANAGER 6 The Nature of Management 7 Managerial Behaviour and Effectiveness 8 The Nature of Leadership

1 3 25 65 111 113 144 187 189 236 280

Part 4 THE INDIVIDUAL

333

9 10 11 12

Individual Differences The Nature of Learning The Process of Perception Work Motivation and Rewards

335 389 434 470

Part 5 GROUPS AND TEAMWORK

515

13 The Nature of Work Groups and Teams 14 Working in Groups and Teams

517 554

Part 6 ORGANISATIONAL STRUCTURES

593

15 Organisation Structure and Design 16 Patterns of Structure and Work Organisation 17 Technology and Organisations

595 633 662

Part 7 MANAGEMENT OF HUMAN RESOURCES

697

18 Job Satisfaction and Work Performance 19 Human Resource Management 20 Resourcing the Organisation

699 746 795

Part 8 IMPROVING ORGANISATIONAL PERFORMANCE

829

21 Organisational Control and Power 22 Organisation Development (Culture, Conflict and Change) 23 Management Development and Organisational Effectiveness

831 887 941

‘OH, GREAT SPIRIT, GRANT THAT I MAY NOT CRITICISE MY NEIGHBOURS UNTIL I HAVE WALKED A MILE IN THEIR MOCCASINS.’ Traditional Native-American saying

CONTENTS IN DETAIL

Exhibits, Management in Action, Case Studies and Business Press In acknowledgement and appreciation Publisher’s acknowledgements Guided tour of the book Guided tour of the Companion Website

xiv xvii xviii xx xxii

Part 1 MANAGEMENT AND ORGANISATIONAL BEHAVIOUR 1 Introduction About this book The aims of this book The seventh edition Your study of the book The changing nature of work organisation The study of management and organisational behaviour The use of case studies

2 The Nature of Organisational Behaviour The meaning of organisational behaviour Influences on behaviour in organisations Behavioural science – a multidisciplinary approach The importance of people and organisational behaviour Organisational metaphors Orientations to work and the work ethic Management as an integrating activity The psychological contract Changing nature of the psychological contract Organisational practices The Peter Principle Parkinson’s Law The need for a cross-cultural approach Is organisational behaviour culture-bound? Models for understanding the impact of culture Five dimensions of culture: the contribution of Hofstede Cultural diversity: the contribution of Trompenaars Summary: convergence or culture-specific organisational behaviour Case study 2.1: Eric and Kipsy: complexities of management and organisational behaviour

3 4 4 6 16 17 19 20

25 26 27 29 30 32 33 34 37 39 40 40 41 42 43 44 47 49 51 56

3 Approaches to Organisation and Management Management theory Developments in management and organisational behaviour The classical approach Scientific management Relevance of scientific management Bureaucracy Criticisms of bureaucracy Evaluation of bureaucracy Structuralism The human relations approach Evaluation of the human relations approach Neo-human relations The systems approach The contingency approach Other approaches to the study of organisations The decision-making approach Social action A number of different approaches Postmodernism Relevance to management and organisational behaviour Japanese management Towards a scientific value approach? Benefits to the manager Management in Action 3.1: Japanese management Case study 3.1: Helgaton Ltd: organisational theory in practice

65 66 66 67 69 71 74 75 76 78 78 80 81 82 84 84 85 85 87 87 89 90 91 93 95 102

Part 2 THE ORGANISATIONAL SETTING 4 The Nature of Organisations

113

The context of the organisation The formal organisation Basic components of an organisation Private and public sector organisations Production and service organisations Types of authority and organisations The classification of organisations Prime beneficiary of the organisation Primary activity of the organisation

114 115 117 118 120 121 122 122 123

viii

CONTENTS IN DETAIL

The organisation as an open system Interactions with the environment The comparative study of organisations Organisational sub-systems The analysis of work organisations Contingency models of organisation The influence of technology Information technology Managing technical change The informal organisation The organisation of the future Organisational goals

5 Organisational Goals, Strategy and Responsibilities The nature of organisational goals The functions of goals Integration of goals Classification of organisational goals Alteration of goals Organisational ideologies and principles Mission statements Objectives and policy The profit objective Fallacy of the single objective The need for strategy The concept of synergy SWOT analysis The management of opportunities and risks Social responsibilities of organisations Codes of conduct Organisational stakeholders Values and ethics Corporate social responsibility Business ethics Related legislation An integrated approach Management in Action 5.1: IBM Code of Conduct Case study 5.1: Mergers and acquisitions: the consequences of expansion at Square Deal plc Case study 5.2: Welcome to the party: home selling with Top-to-Toe

124 126 127 128 129 131 132 133 134 134 137 137

144 145 146 147 148 149 150 151 152 154 155 157 158 159 160 161 162 163 166 167 168 170 171 177 182 183

Part 3 THE ROLE OF THE MANAGER 6 The Nature of Management The meaning of management Management and administration The process of management

Principles of management Management as a social process The tasks and contribution of a manager Essential nature of managerial work The efforts of other people Management in service industries Management in private enterprise and public sector organisations The work of a manager Managerial roles Behaviour pattern of general managers Determining what real managers do Patterns of managerial work and behaviour The attributes and qualities of a manager Managers of the future? Management in Action 6.1: The roles of the manager and the Individual Management Model Case study 6.1: What is management? Defining the manager’s role

7 Managerial Behaviour and Effectiveness Managerial style and behaviour Managers’ attitude towards people Japanese ‘Theory Z’ environment The Managerial/Leadership Grid® Framework for patterns of behaviour Management systems System 4 management Management by Objectives (MBO) Evaluation of MBO Managing people Basic managerial philosophies Choice of managerial style Managerial effectiveness Measures of effectiveness 3-D model of managerial behaviour General criteria of managerial effectiveness The management of time Case example: Chemical company Case study 7.1: Bringing management to book: how to manage a library Case study 7.2: As safe as houses: branch management in a building society

8 The Nature of Leadership

189 190 194 195

The meaning of leadership The importance of leadership Leadership and management Approaches to leadership The qualities or traits approach The functional (or group) approach Leadership as a behavioural category

197 199 199 200 202 203 203 206 207 209 210 210 211 214 217 227

236 237 238 240 241 243 245 246 249 250 251 252 256 259 261 261 264 265 274 275 276 280 281 282 283 285 287 287 289

CONTENTS IN DETAIL

Styles of leadership Continuum of leadership behaviour The situational approach Contingency theories of leadership Fiedler’s contingency model Vroom and Yetton contingency model The Vroom and Jago revised decision model Path–goal theory Readiness of the followers or group Transformational leadership Inspirational leadership Power and leadership influence The leadership relationship No one best form of leadership National cultural dimensions of leadership Effectiveness of leadership styles Variables affecting leadership effectiveness Leadership development Leaders of the future Management in Action 8.1: Autoglass: Leadership success factors Management in Action 8.2: IBM Leadership Development Centre (LDC) Case study 8.1: The paradox of Pim Fortuyn: a study in charismatic leadership

291 292 294 295 295 297 298 299 300 301 304 306 307 309 310 312 313 314 315 317 318 327

PART 4 THE INDIVIDUAL 9 Individual Differences

335

By Linda Hicks The changing nature and scope of managing individuals at work Personality Nomothetic and idiographic approaches Theoretical approaches: nomothetic Theoretical approaches: idiographic Other theoretical approaches Cognitive theory: Kelly’s personal construct theory Applications within the work organisation Stress and the individual Ability Testing Attitudes Gender and organisations Understanding women’s position and status Economic theories Psychological sex differences The socialisation process Orientations and motivations towards work Working practices

336 339 342 343 346 347 350 352 354 355 360 362 366 368 369 369 370 370 371

Career development Leadership, management and women Positive approaches

372 376 378

10 The Nature of Learning

389

By Linda Hicks The meaning and nature of learning Organisations and the management of learning Knowledge management The learning organisation How do people learn? Behaviourism The outcomes of learning Operant conditioning Social learning Limitations of the behaviourist school Cognitive theories Learning styles Complex models of learning Creativity Facilitating learning Learning theory applied to study skills Applications of learning theory to organisations Case study 10.1: Springboard to success: staff development in practice Case study 10.2: Will the mail get through: managing change at the Royal Mail

390 394 395 399 402 403 405 405 408 408 409 413 414 415 417 420 420 425 427

11 The Process of Perception

434

By Laurie Mullins and Linda Hicks The perceptual process Selectivity in attention and perception Meaning to the individual Internal factors External factors Organisation and arrangement of stimuli Perceptual illusions Perceiving other people Transactional analysis Selection and attention Organisation and judgement The importance of body language Attribution theory Perceptual distortions and errors Stereotyping The halo effect Perceptual defence Projection Illustrative example: perception of women

435 435 437 437 440 441 442 445 448 450 452 453 455 456 457 458 459 459 459

12 Work Motivation and Rewards The meaning of motivation Needs and expectations at work Motivation and organisational performance

470 471 472 474

ix

x

CONTENTS IN DETAIL

Frustration-induced behaviour Money as a motivator Theories of motivation Content theories of motivation Maslow’s hierarchy of needs theory Alderfer’s modified need hierarchy model Herzberg’s two-factor theory McClelland’s achievement motivation theory Process theories of motivation Vroom’s expectancy theory The Porter and Lawler expectancy model Lawler’s revised expectancy model Implications for managers of expectancy theories Equity theory of motivation Goal theory Attribution theory Relevance of theories of motivation Cross-cultural dimensions of motivation The motivation of knowledge workers Management in Action 12.1: Developing reward strategies to motivate and compensate knowledge workers Case study 12.1: Staff motivation: not so much a motivational pyramid, more a slippery slope

475 477 478 480 478 484 485 487 489 490 492 494 495 496 498 499 499 500 500

504

14 Working in Groups and Teams

554 Interactions among members 555 Belbin’s team-roles 556 Patterns of communication 559 Analysis of individual behaviour 562 Sociometry 562 Interaction analysis 563 Frameworks of behavioural analysis 565 An essential feature of work organisations 566 Individual compared with group or team performance 569 The risky-shift phenomenon 569 ‘Groupthink’ 570 Brainstorming 570 Group dynamics 573 T-groups 574 Effective teamworking 575 Management in Action 14.1: Profiling of managers for leadership development in a cross-section of South African organisations 579 Management in Action 14.2: Barriers come down 585 to build up team spirit

510

PART 6 ORGANISATIONAL STRUCTURES

PART 5 GROUPS AND TEAMWORK

15 Organisation Structure and Design 595 13 The Nature of Work Groups and Teams The meaning and importance of groups and teams The difference between groups and teams Group values and norms The importance of teamwork Formal and informal groups Reasons for formation of groups or teams Group cohesiveness and performance Membership Work environment Organisational factors Group development and maturity Potential disadvantages of strong, cohesive groups Characteristics of an effective work group The effects of technology on work groups Role relationships Role conflict Role stress Management in Action 13.1: Teamwork in a small company Management in Action 13.2: Remote control – a case study Case study 13.1: Floating on air: the importance of teamwork at Hovertec

517 518 518 520 521 525 527 528 529 530 531 531 532 533 534 536 538 540 543 545 550

The meaning and nature of organisation structure The importance of good structure Levels of organisation The importance of the hierarchy The design of organisation structure Clarification of objectives Task and element functions The division of work Centralisation and decentralisation Principles of organisation Span of control The chain of command ‘Flatter’ organisation structures Formal organisational relationships Line and staff organisation The inverted organisation Project teams and matrix organisation Effects of a deficient organisation structure Organisation charts Structure and organisational behaviour Case study 15.1: A small cog in a big wheel: company restructuring at Zeton Case study 15.2: Loud and clear: leadership in telecommunications

596 597 598 600 601 603 604 605 608 609 610 611 612 613 615 617 617 619 621 622 629 630

CONTENTS IN DETAIL

16 Patterns of Structure and Work Organisation

633 Variables influencing organisation structure 634 The contingency approach 634 Size of organisation 635 Technology 638 The Woodward study 638 Major dimensions of technology: the work of Perrow 640 Environment 641 The Burns and Stalker study 642 ‘Mixed’ forms of organisation structure 643 The Lawrence and Lorsch study 644 Evaluation of the contingency approach 646 Contribution of contingency theory 648 Culture as a contingent factor 649 Alternative forms of structure 649 The demand for flexibility 651 Telecommuting 652 The shamrock organisation 652 The nature of delegation and empowerment 654 Case study 16.1: Bureaucracy could seriously damage your health: staff empowerment at City Hospital 658 Case study 16.2: Could I have an estimate? Organisational structure at Fabrique Décor 658

17 Technology and Organisations By David Preece 662 Theorising technology 663 Using a socio-technical ensemble perspective: the case of Butler Co. 669 Technological change and organisations 672 Adopting and introducing new technology 674 Case studies in technological/organisational change 679 Case study 17.1: A thirst for technology: new systems at the bars of Tawny Taverns 679 Case study 17.2: Web page not found: internal communications at Redstart Computers 682 Organisational contexts, social and political processes and technological change 685 ICTs, networks, organisations and society 686

PART 7 MANAGEMENT OF HUMAN RESOURCES 18 Job Satisfaction and Work Performance The meaning and nature of job satisfaction Dimensions of job satisfaction Framework of study Information communications technology

699 700 700 703 703

Stress at work Role relationships and conflict Levels of stress Coping with stress Work organisation and job design Individual job redesign A comprehensive model of job enrichment Broader organisational approaches to improved job design The work/life balance Employee involvement Empowerment and job satisfaction Self-managed work groups Flexible working arrangements Quality circles Management style and culture Contextual factors in job design The happy/productive worker Management in Action 18.1: Job satisfaction: the fit between expectations and experiences Management in Action 18.2: An elusive but expensive concept: stress Management in Action 18.3: Work-Life Balance case studies Management in Action 18.4: Beyond the nine-to-five Case study 18.1: The wide open spaces: linking job satisfaction and work performance Case study 18.2: The changing role of supervisors: demonstrating the effect of communication and training on morale Case study 18.3: Flying like the wind: motivation, job design and culture at Falcon Car Company

19 Human Resource Management The nature of human resource management (HRM) HRM policies, activities and functions Organisation of the HRM function HRM: a shared responsibility The importance of HRM Training and development The management of training Investors in People Performance appraisal Questions to be addressed 360° feedback and upward appraisal Establishing the appraisal system Methods of appraisal Potential problem areas Employment relations Unitary and pluralistic perspectives Regulating the employment contract Responsibility for employment relations International dimensions of HRM Industrial democracy in European countries

706 708 709 710 713 714 715 717 720 722 723 723 724 727 728 728 729 732 733 735 736 741

742 743 746 747 749 751 752 755 756 758 761 762 764 765 766 767 769 771 773 774 777 778 779

xi

xii

CONTENTS IN DETAIL

The German system Effectiveness of the HRM function Management in Action 19.1: The Investors in People Standard Management in Action 19.2: Performance management at Autoglass Limited Case study 19.1: Beer and sandwiches: personnel management at London Taverns Case study 19.2: Nothing succeeds like success: accelerating performance at Sisson Systems

779 780

20 Resourcing the Organisation

795 796 796 798 800 802 804 804 806 806 808 810 810 812 813

The concern of all managers Human resource planning The value of human resource planning Recruitment and selection of staff Job analysis Person specifications Difficulties and distastes of the job The importance of job analysis Attracting suitable applicants The selection process Selection tests and questionnaires Group exercises The selection interview Interviewing style Competency-based approach to recruitment and selection The selection decision Induction and follow-up Costs of the selection process Effectiveness of the recruitment and selection process Management in Action 20.1: Marks & Spencer PLC’s graduate selection process Case study 20.1: Please enter your password: effective resource management at Wessex Computers Case study 20.2: Inky fingers: HRM failure at Sumprint Ltd

783 786 790 791

814 815 816 817 817 821

825 826

PART 8 IMPROVING ORGANISATIONAL PERFORMANCE 21 Organisational Control and Power The meaning of control Assumptions of organisation and management Elements of an organisational control system Forms of control Classification of control systems Strategies of control in organisations

831 832 834 835 837 838 840

Characteristics of an effective control system Power and management control Perspectives of organisational power Pluralistic approaches to power The balance between order and flexibility Delegation and empowerment The manager–subordinate relationship Benefits of delegation Reasons for lack of delegation A systematic approach to delegation The art of delegation The concept of empowerment Does empowerment deliver? Behavioural factors in control systems Overcoming resistance to management control Financial and accounting systems of control Management in Action 21.1: Empowerment Case study 21.1: The enthusiastic delegator: the consequences of promoting beyond ability? Case study 21.2: Alpha to Omega: the effects of financial management on company performance

22 Organisation Development (Culture, Conflict and Change) The meaning of organisation development Topics associated with OD Organisational culture Types of organisational culture Influences on the development of culture The cultural web The importance of culture Organisational climate Employee commitment Organisational conflict Contrasting views of conflict The sources of conflict Strategies for managing conflict The nature of organisational change Planned organisational change Resistance to change The management of organisational change Human and social factors of change Responsibilities of top management Management in Action 22.1: Organisational culture, change and IT in an SME Management in Action 22.2: Siemens Nixdorf’s new dynamism Case study 22.1: It’s tough at the top: managing conflict in the Wakewood organisation Case study 22.2: Getting political: management in local government Case study 22.3: A matter of life or death: managing knowledge at an NHS Trust

842 843 845 846 848 849 850 852 853 854 857 859 863 864 865 867 873 880

883

887 888 888 891 892 894 895 896 899 901 903 904 906 908 909 910 913 915 916 920 923 924 933 934 935

CONTENTS IN DETAIL

23 Management Development and Organisational Effectiveness The importance of effective management The meaning and nature of management development An integrated model of management development Management development process Continuing professional development (CPD) Management education, training and development The Management Charter Initiative (MCI) Leadership and Management Model The nature of organisational effectiveness The Peters and Waterman study Heller’s study of European excellence The Goldsmith and Clutterbuck study The learning organisation Total Quality Management (TQM) Business process re-engineering (BPR) Building Tomorrow’s Company The EFQM excellence model Assessing organisational performance Organisation audit

941 942 942 944 949 953 954 955 956 959 960 961 962 962 964 968 971 971 975 976

Benchmarking Performance indicators in the public sector Gap analysis A range of different criteria The twenty-first century organisation and people Management in Action 23.1: Extracts from Abbey Performance Development Programme Management in Action 23.2: A cure for growing pains – Costa Coffee Management in Action23.3: Components of the Management Standards Management in Action 23.4: Building organisational competence Case study 23.1: Chips with everything: managing cultural change at Eurasia Electronics Case study 23.2: Holding the front page: expansion at Rudmore Press Conclusion Business Press Glossary Index

Companion Website resources Visit the Companion Website at www.booksites.net/mullins For students: Multiple choice and short answer questions to help test your learning ■ Technology Solutions – short web articles which explore further the managerial implications of technology ■ Weblinks to relevant sites on the web ■ An online glossary to explain key terms ■

For lecturers: ■ Complete, downloadable Instructor’s Manual which includes: – Teaching tips – Extra cases – Solutions/examples to discussion and other questions ■ Powerpoint slides that can be downloaded and used as OHTs ■ Testbank of question material Also: This site has a syllabus manager, search functions, and email results functions. Note: A printed version of the Instructor’s Manual is also available free to adopters of Management and Organisational Behaviour. Please contact your local sales representative whose details can be located on our website www.pearsoned.co.uk

976 977 977 977 980 982 985 987 988 997 997 1003 1005 1051 1065

xiii

EXHIBITS, MANAGEMENT IN ACTION, CASE STUDIES AND BUSINESS PRESS Exhibits 3.1 3.2 5.1 6.1 7.1 8.1 8.2 9.1 10.1 11.1 11.2 13.1 14.1 18.1 18.2 21.1 23.1 23.2 23.3

NHS pays £30.96 just to sharpen pencils Tools that do the business: management theories Business ethics: what’s in it for you? The infant school headteacher as a manager It’s a people thing Developing leadership in the NHS of the 21st century First class coach Why use psychological tests? Learning new skills: the importance of feedback Hospitals set to play it by ethnic book Judy Owen wins battle against Professional Golfers’ Association to wear trousers Teamwork’s own goal Management: brainstorm in a rainstorm If you want people to do a good job, give them a good job to do Have a life and keep your job Empowerment and the custody officer Developing managers: applying the theory in practice Management succession: developing leadership at 3M Quality counts: TQM in an NHS trust

76 91 171 191 258 305 312 362 410 454 460 524 573 719 725 861 950 952 968

Management in Action 3.1 5.1 6.1 8.1 8.2 12.1 13.1 13.2 14.1 14.2 18.1 18.2 18.3 18.4 19.1 19.2 20.1 21.1 22.1 22.2

Japanese management IBM Code of Conduct The roles of the manager and the Individual Management Model Autoglass: Leadership success factors IBM Leadership Development Centre (LDC) Developing reward strategies to motivate and compensate knowledge workers Teamwork in a small company Remote control – a case study Profiling of managers for leadership development in a cross-section of South African organisations Barriers come down to build up team spirit Job satisfaction: the fit between expectations and experiences An elusive but expensive concept: stress Work-Life Balance case studies Beyond the nine-to-five The Investors in People Standard Performance management at Autoglass Limited Marks & Spencer PLC’s graduate selection process Empowerment Organisational culture, change and IT in an SME Siemens Nixdorf’s new dynamism

95 177 217 317 318 504 543 545 579 585 732 733 735 736 783 786 821 873 923 924

LIST OF FIGURES

23.1 23.2 23.3 23.4

Extracts from Abbey Performance Development Programme A cure for growing pains – Costa Coffee Components of the Management Standards Building organisational competence

982 985 987 988

Case studies 2.1 3.1 5.1 5.2 6.1 7.1 7.2 8.1 10.1 10.2 12.1 13.1 15.1 15.2 16.1 16.2 17.1 17.2 18.1 18.2 18.3 19.1 19.2 20.1 20.2 21.1 21.2 22.1 22.2 22.3 23.1 23.2

Eric and Kipsy: complexities of management and organisational behaviour Helgaton Ltd: organisational theory in practice Mergers and acquisitions: the consequences of expansion at Square Deal plc Welcome to the party: home selling with Top-to-Toe What is management? Defining the manager’s role Chemical company Bringing management to book: how to manage a library As safe as houses: branch management in a building society The paradox of Pim Fortuyn: a study in charismatic leadership Springboard to success: staff development in practice Will the mail get through: managing change at the Royal Mail Staff motivation: not so much a pyramid, more a slippery slope Floating on air: the importance of teamwork at Hovertec A small cog in a big wheel: company restructuring at Zeton Loud and clear: leadership in telecommuncations Bureaucracy could seriously damage your health: staff empowerment at City Hospital Could I have an estimate? Organisational structure at Fabrique Décor A thirst for technology: new systems at the bars of Tawny Taverns Web page not found: internal communications at Redstart Computers The wide open spaces: linking job satisfaction and work performance The changing role of supervisors: demonstrating the effect of communication and training on morale Flying like the wind: motivation, job design and culture at Falcon Car Company Beer and sandwiches: personnel management at London Taverns Nothing succeeds like success: accelerating performance at Sisson Systems Please enter your password: effective resource management at Wessex Computers Inky fingers: HRM failure at Sumprint Ltd The enthusiastic delegator: the consequences of promoting beyond ability? Alpha to Omega: the effects of financial management on company performance It’s tough at the top: managing conflict in the Wakewood organisation Getting political: management in local government A matter of life or death: managing knowledge at an NHS trust Chips with everything: managing cultural change at Eurasia Electronics Holding the front page: expansion at Rudmore Press

56 102 182 183 227 274 275 276 327 425 427 510 550 629 630 658 658 679 682 741 742 743 790 791 825 826 880 883 933 934 935 997 997

Business Press 1 2 3 4 5 6 7 8 9

A safe way to hold on to staff Business schools share Enron blame Recruitment: facing the next brain drain Companies pressed to adopt higher standards Forget how the crow flies Public sector: go home and prepare for e-government Employees as investors Leader of the band who likes to run the show Great leaders: pioneer and a shrewd strategist

1006 1007 1008 1010 1012 1017 1019 1020 1022

xv

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LIST OF FIGURES

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29

Endangered species Mentoring moves into a leading role Driving your employees up the wall A focus on workers’ individual needs Advantages of promoting a boutique mindset Avoiding the madness of groupthink End to ‘departmentalism’ a vision of things to come A long-distance relationship Network protection is a key stroke Relentless rise of the pleasure seekers EU & US: Where are the best workplaces? Marrying performance with reward Human capital: is it ‘personnel’ with yet more make-up? New learning models are under scrutiny Patterns can show if you are up to the job Massive US effort to set up control systems Asda: the listening store Organisations, too, can be put on the couch Swiss group at top of learning tree The rise and rise of the corporate learning officer

1023 1025 1027 1028 1029 1030 1031 1032 1034 1035 1037 1038 1040 1041 1043 1044 1045 1047 1048 1049

IN ACKNOWLEDGEMENT AND APPRECIATION

A warm and special tribute is paid to my wife Pamela, children and family for their continuing support and encouragement for this seventh edition. Particular acknowledgements and thanks are due for the contributions from my friends and colleagues Linda Hicks, David Preece and Sara Lamond. Thanks and appreciation also to Derek Adam-Smith, Rajeev Bali, Martin Brunner, Richard Christy, Ray French, Karen Meudell, Anne Riches, Amanda Stevens, Lynn Thomson, Cheryl Walmsley. I gratefully acknowledge the help and support received from: Managers who kindly provided information from their own organisations and gave permission to reproduce material in the book Aileen Cowan, Assistant Director, The Institute of Chartered Secretaries and Administrators Liz Harris, Marketing Communications Manager, The Institute of Administrative Management Rebecca Hoar, Section Editor, Management Today Sue Mann, Editor, Professional Manager. A special debt of appreciation is due to members of the team at Pearson Education including Matthew Walker, Colin McDougall, Karen McLaren, Janey Webb, Colin Reed, Jacqueline Senior and Simon Lake for their invaluable professionalism and guidance. Thank you all for a pleasant and rewarding partnership. I wish to acknowledge and thank a number of people who may be unaware how much their friendship, interest and support has in a variety of ways helped in the completion of this seventh edition, including: Stephen Darvill; Philip Voller; Kate Brackenbury; Valerie and Peter Hallam; Di and Mike Blyth; Julie and John Bradley; Jenny and Tony Hart; Vilma and Will Hemsley; Lynn and Wayne Miller; Christine and David Paterson; Ann Ward.

Reviewers Special thanks are due to the following reviewers, approached by the publishers, for their valued insightful and constructive comments that have helped shape the contents of this present edition: Ann Norton, Sheffield Hallam University, UK Brian Stone, Manchester Metropolitan University, UK Kim Parker, University of Kent, UK Bob Smale, Brighton University, UK Alasdair Maclean, University of Abertay, UK Peter Falconer, Glasgow Caledonian University, UK Hugo Misselhorn, Management & Organisation Development Consulting, South Africa Marijek Dielman, Hotel Management School, Maastricht, The Netherlands David Wilson, Wethouder Koniglaan, The Netherlands. Laurie J Mullins

PUBLISHER’S ACKNOWLEDGEMENTS

Chapter 1 – Introductory assignment is reprinted with permission from Von Oech, R., A Whack On The Side Of The Head, Warner Books Inc. (1998), p. 20. Copyright © 1983, 1990, 1998 by Roger Von Oech.

Chapter 7 – Assignment 1 ‘Principle of Supportive Relationships Questionnaire’ is reprinted with permission from Likert, R., The Human Organization – Its Management and Value, McGraw-Hill, New York (1976), pp. 48–9.

Chapter 2 – Assignment 1 is reprinted with permission from Rowe, C., The Management Matrix: The Psychology of Interaction, Alfred Waller Ltd (1992), p. 1, with permission from Patricia Rowe.

Personal awareness and skills exercise ‘Your Management Style’ is reprinted with permission from Osland, J. S., Kolb, D. A. and Rubin, I. M., Organizational Behavior: An Experimental Approach, seventh edition, Prentice Hall (2001), pp. 24–5.

Personal awareness and skills exercise ‘So What’s Your Work Ethic?’ is reprinted with permission from Professional Manager, published by the Chartered Management Institute, May 2003, p. 38, and Walmsley, C. J., Your Future Looks Bright, Preston Beach (2002), p. 98. Case study 2.1 ‘Eric and Kipsy’ is reprinted with permission from Porter, L. W., Lawler, E. E. and Hackman, J. R., Behavior in Organizations, McGraw-Hill, New York (1975), pp. 3–14. Chapter 3 – Assignment 1 is reprinted with permission from DuBrin, A. J., Human Relations: A Job-Oriented Approach, Reston Publishing/Prentice Hall/Pearson Education Inc. (1978), pp. 296–7. Case study 3.1 ‘Applications of Organisation Theory in Helgaton Ltd’, is reprinted with permission from Mullins, L. and White, I., in Adam-Smith, D. and Peacock, A. (eds), Cases in Organisational Behaviour, Pearson Education (1994), pp. 19–29. Chapter 4 – Assignment ‘Our Organizational Society: Your Association with Organizations’ is reprinted with permission from Kast, F. E. and Rosenzweig, J. E., Experiential Exercises and Cases in Management, McGraw-Hill, New York (1976), pp. 13–15. Chapter 5 – Personal awareness and skills exercise ‘Assessing your Work Values’ is reprinted with permission from Misselhorn, A., The Head and Heart of Management, Management and Organization Development Consultants (SA) (2003), p. 36.

Case study 7.1 ‘Library Management’ is reprinted with permission from the Institute of Chartered Secretaries and Administrators, Management Principles Pilot Paper, Administrator, December 1993. (Administrator is now published under the title Chartered Secretary.) Chapter 8 – Assignment 1 ‘Least Preferred Co-worker (LPC) Scale’ is reprinted from A Theory of Leadership Effectiveness, McGraw-Hill (1976), p. 41, with the permission of the author, Professor F. E. Fiedler, University of Washington. Assignment 2 ‘T-P Leadership Questionnaire: An Assessment of Style’ by Sergiovanni, T., Metzcus R. and Burden, L. adapted from their article ‘Leadership Behavior Description Questionnaire’, in the American Educational Research Journal 6, 1969, is reprinted by permission of the publisher, the American Educational Research Association. Assignment 4 ‘Your Leadership Style’ is reprinted with permission from Schermerhorn Jr, J. R., Hunt, J. G. and Osborn, R. N., Managing Organizational Behavior, fourth edition, used by permission of John Wiley & Sons Inc. (1991), p. 484. Case study 8.1 ‘The Paradox of Pim Fortuyn: A Study in Charismatic Leadership’. I am grateful to my colleague Karen Meudell for providing this case study. Chapter 10 – Case study 10.2 ‘Royal Mail: Making your life easier by helping you do a better job’. Thanks to Yasmin Ahmed and Royal Mail Group plc.

Case study 5.1 ‘Square Deal plc’ is reprinted with permission from the Institute of Administrative Management, Diploma in Administrative Management Examination Paper, Summer 1983.

Chapter 11 – Personal awareness and skills exercise ‘Inference–observation’ exercise is reprinted with permission from Haney, W. V., Communications and Interpersonal Relations: Text and Cases, sixth edition, Irwin, Illinois (1992), p. 213.

Case study 5.2 ‘Top to Toe’ is reprinted with permission from the Chartered Institute of Secretaries and Administrators, Management Principles Examination Paper, June 2003.

Chapter 12 – Personal awareness and skills exercise contributed by Sheila Ritchie of Elm Training and derived from the full 12-factor Motivation to Work Profile. It is reprinted with permission.

Chapter 6 – Assignment 2 ‘Have YOU Got What it Takes to be a CEO?’ is reprinted with permission from Gwyther, M., Management Today, November 2001, pp. 56–9.

Case study 12.1 ‘Not so Much a Motivational Pyramid, More a Slippery Slope’. I am grateful to Linda Fleming for providing this case.

Case study 6.1 ‘What Is Management?’ from Doswell, R. and Nailon, P., Case Studies in Hotel Management, third edition, Barrie & Jenkins (1976).

Chapter 13 – The copyright of case study 13.1 ‘Hovertec plc’ rests with my colleague Tom McEwan, and is reprinted with permission.

Chapter 14 – Personal awareness and skills exercise is reprinted with permission from Woodcock, M., 50 Activities for Teambuilding, Gower, Aldershot (1988), with permission from Ashgate Publishing Limited.

Chapter 21 – ‘The Organisational Politics Questionnaire’ is reprinted with permission from DuBrin, A. J., Human Relations: A Job-Oriented Approach, fifth edition, Prentice Hall/Pearson Education Inc. (1992), pp. 306–7.

Chapter 15 – Assignment 2 is reprinted with permission from the Institute of Chartered Secretaries and Administrators, Management Principles Examination Paper, June 1999.

Case study 21.2 ‘The Omega organisation’ is reprinted with permission of the Institute of Chartered Secretaries and Administrators, Management: Principles and Policy Examination Paper, June 1987.

Case study 15.1 ‘Zeton Ltd’ is reprinted with permission from Administrator, The Institute of Chartered Secretaries and Administrators, April 1996, p. 36. (Administrator is now published under the title Chartered Secretary.)

Chapter 22 – Assignment ‘Rate Your Readiness to Change’ is reprinted with permission from Stewart, T. A., Fortune, 7 February 1994, pp. 63–4, Time Inc. All rights reserved.

Case study 15.2 ‘Direct Telecommunications PLC (DT)’ is reprinted with permission from the Institute of Chartered Secretaries and Administrators, Organisation and the Human Resource Examination Paper, May 2002.

Case study 22.1 ‘The Wakewood organisation’ is reprinted with permission from the Institute of Chartered Secretaries and Administrators, Management: Principles and Policy Examination Paper, December 1986.

Chapter 16 – Case study 16.1 ‘The City Hospital: Bureaucracy and Empowerment’ is reprinted with permission from the Institute of Chartered Secretaries and Administrators, Organisation and the Human Resource Examination Paper, November 2002.

Case study 22.2 ‘Gremby County Council’ is reprinted with permission from Bowman, C. and Jarrett, M. G., Management in Practice, third edition, Butterworth-Heinemann (1996), pp. 209–11, with permission from Elsevier Ltd.

Case study 16.2 ‘Fabrique Décor’ is reprinted with permission from the Institute of Administrative Management, Advanced Diploma Examination Paper, December 2000. Chapter 18 – Case study 18.1 ‘The Wide Open Spaces’ from Chilver, J., People, Communication and Organisation, Pergamon Press (1984), pp. 118–19. Case study 18.2 ‘Managing Supervisors’ is reprinted with permission from the Institute of Chartered Secretaries and Administrators, Management: Principles and Policy Examination Paper, June 1985. Case study 18.3 ‘The Falcon Car Company’ is reprinted with permission from the Institute of Chartered Secretaries and Administrators, Organisation and the Human Resource Examination Paper, June 2003. Chapter 19 – Case study 19.1 ‘London Taverns Ltd’ has been prepared jointly with, and from original material supplied by, my colleague Karen Meudell. Case study 19.2 ‘Accelerating the performance momentum at Sisson Systems’ is reprinted with permission from the Institute of Chartered Secretaries and Administrators, Organisation and the Human Resource Examination Paper, June 1999. Chapter 20 – Case study 20.1 ‘Wessex Computers’ is reprinted with permission from the Institute of Administrative Management, Certificate in Administrative Management Examination Paper, Summer 1983. Case study 20.2 ‘Sumprint Ltd’ is reprinted with permission from the Institute of Administrative Management, Case Study Examination Paper, June 2002.

Case study 22.3 ‘Managing Knowledge at an NHS Trust’. I am grateful to Rajeev K. Bali and Ashish N. Dwivedi for providing this case. Chapter 23 – Assignment 2 ‘Assessing your Organisation’ is reprinted with permission from BBC, Building Tomorrow’s Company – Supporting Notes and the Centre for Tomorrow’s Company and William Tate, 1999. Personal awareness and skills exercise is adapted from material prepared by John Bourn for a UNISON distance learning course and is used with permission of the Education Officer. Case study 23.1 ‘Eurasia Electronics’ is reprinted with permission from the Institute of Chartered Secretaries and Administrators, Professional Administration Examination Paper, December 1999. Case study 23.2 ‘Rudmore Press Limited’. This case was prepared jointly with, and from original material provided by, my colleague Karen Meudell. DOGBERT character drawings copyright © 1991 United Feature Syndicate, Inc. Please note: we are all influenced by the thoughts and ideas of other people that tend to drift into the subconscious and are not always distinguished clearly from one’s own. I have attempted to give references for sources of work by other writers but apologise to any concerned if acknowledgement has inadvertently not been recorded. Should there by any queries, errors or omissions please contact the publisher.

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PART TITLE

GUIDED TOUR OF THE BOOK

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8

PART 4 THE INDIVIDUAL ■

THE NATURE OF LEADERSHIP

■ ■ ■

sensori-motor period: birth to 2 years; pre-operational thought: 2 years to 7 years; concrete operations: 7 years to 11 years; formal operations: 11 years to 15 years.

Piaget’s theory offers a tight coherent perspective of the maturation of intellectual thought and development. His studies introduced the notion of the cyclical nature of learning and the ways in which children and adults adjust to and accommodate to their environment. For many cognitive theorists learning is viewed as a sequence, a sequence which processes information in three distinct stages:

An essential part of management is co-ordinating the activities of people and guiding their efforts towards the goals and objectives of the organisation. This involves the process of leadership and the choice of an appropriate form of action and behaviour. Leadership is a central feature of organisational performance. The manager must understand the nature of leadership influence and factors which determine relationships with other people, and the effectiveness of the leadership relationship.

■ ■ ■

EXHIBIT 10.1

Learning new skills: the importance of feedback Yoga is one of the six systems of Indian philosophy. There are a number of different interpretations of yoga and one of these is taught by Yogacharya B.K.S Iyengar.64 Learning a physical skill such as Iyengar yoga privides a good illustration of

Photo: Rajesh Jantilal/AFP/Getty Images

■ ■

In the twenty-first century, leaders must create an atmosphere in which people believe in strategy, believe in management decisions, and believe in their work. Once people believe in management decisions, there is an excitement within an organization. Such an atmosphere makes an organization prosper. Successful leaders create this sort of environment both inside and outside the organization.

LEARNING OUTCOMES

Learning outcomes: summarise what students will learn in the chapter

After completing this chapter you should be able to:
explain the meaning and importance of leadership in work organisations;
contrast patterns of managerial leadership and main approaches to and studies of leadership;
detail the nature of managerial leadership and the exercise of leadership power and influence;

■ ■

the continual cycle of learning; the importance of stages in learning; the significance of information and feedback; the importance of support structures – both physical, social and mental.

The yoga poses are challenging and require the complete involvement of the senses and total concentration of the mind. Otherwise a fall to the floor is likely! The teacher provides clear information about the positioning of the body and the class tries to assimilate this information and imitate the teacher. Initally it is hard to connect to muscles that have been lying dormant for some considerable time! The final pose is reached after a series of ‘sub poses’ have been practised. Each sub pose is gradually developed and becomes more complex. At each stage students have to remember ‘what it felt like’ in the previous sub pose to be sure that they are building on and pushing themselves into a more challenging posture. Learning the poses therefore requires active perception and attention to the teacher as well as attention to internal feedback about the positioning of the body. Striving for excellence and gaining the benefits from each posture is the goal of Iyengar yoga for all students. Therefore no matter the physical limitations of the body or

Subir Chowdhury Management 21C, Financial Times Prentice Hall (2000)


examine leadership as an aspect of behaviour, and different styles of leadership;
assess contingency theories of leadership and situational factors which determine the characteristics of leadership;
evaluate the nature and main components of transformational leadership and inspirational leadership;
review the variables which determine effective managerial leadership and development.

Photo: Jose Luis Pelaez, Inc./Corbis

the inflexibility of the limbs all students are able to achieve maximum gain from each posture with the help of physical supports. Perhaps a belt to support the legs, perhaps a chair to support the back, Each student develops at their own pace, and with their own props. A teacher will also provide information about whether a student’s posture needs modifying; perhaps a brick under the hand will get the posture closer to perfection. Creativity will be used in identifying the particular needs of certain students. A learning environment is created in which the group supports individuals, information at critical times is provided, individuals are totally engaged in their pursuit of perfection and the teacher encourages, supports and leads by example. Reprinted with permission from Judith Jones and Carol Batterson, Iyengar Yoga Teacher, Hampshire

Although it is beyond the scope of this book to consider the relationship between thinking and learning some researchers have shed insight on the mental constructs that may form. Glaser65 for instance has described these as ‘scaffolds’. This metaphor suggests

Notable quotes: provide insight into managerial thinking, past and present

Exhibits: short vignettes bring managerial theory and practice to life Case studies: integrate a range of themes to encourage analysis of more complex situations

Technology solutions: links to web-based resources which encourage evaluation of technology in solving problems CHAPTER 6 THE NATURE OF MANAGEMENT

217

■ While the importance and responsibility of management is still widely recognised there is a need for new managers, and new methods for a changed environment and nature of work organisations. Europe’s new breed of managers need to focus attention on key strategies including the importance of values and behaviours. Important issues for the future include managing change; leadership and motivation of staff; managing diversity; the development of human resources; and demands for alternative organisational practices.

Square Deal plc is a newly formed subsidiary company of Square Deal International Inc. The intention is to use it to unify the efforts and improve the profitability of the hitherto separate UK subsidiaries of Arnold plc, Carlton plc and Foodrich plc. At present it has a managing director, an administrative/ financial controller and a typist all sharing a large temporary office in central London. Arnold plc has 69 food stores, all within a radius of 30 miles from London. Most of them contain either a small restaurant or a snack bar and occupy high street or suburban shopping centre locations. It owns one small bakery whose total production supplies ten stores with bread and cakes. Perishables for both resale and restaurant use are bought locally but all other products are bought centrally and distributed from one large warehouse. These products are charged to the stores at selling price on computer-printed internal invoices. Store managers are judged solely on revenue. Accounts for each store are produced on the batch computer system at head office which is an old building on the edge of a dockland redevelopment site in East London. The company owns the freehold, as it does of about half of its food stores. Carlton plc has joint managing directors, one in charge of 21 restaurants and one in charge of property development. To date it has built four shopping centres and has plans for three more, all as part of schemes to regenerate old city centres in the north of England, around 150 miles from London. It leases out the shops with the exception of one per centre which it operates as a restaurant. Both MDs rigidly pursue a 15 per cent annual return on investment as their measure of achievement.

MANAGEMENT IN ACTION 6.1

Personal characteristics

IBM is a large and diverse company. IBM managers do many different things. It can be difficult to define core-and-common manager roles relevant to managers throughout such a highly complex organization. The Individual Management Model (IMM) was developed as an aid to managers to help them understand their roles in context. The manager gets work done through other people. IBM has used that simple definition for years. There are two key parts to the definition: getting work done and through other people. The Individual Management Model (IMM) was developed as an aid to managers to visualize how their roles are similar to other managers and how they may differ.

Managers take actions to achieve those objectives. Every manager has unique personal characteristics, and these characteristics will influence his or her behavior. Personal characteristics include: ■ ■ ■ ■

background skills knowledge thinldng style ■ competencies ■ personality

Quick overview of the Individual Management Model (IMM) All managers are responsible for producing results. They do that primarily through other people. The influence that a manager has on direct reports is reflected in the Organizational Climate that he or she creates. Every manager faces slightly different factors that help or hinder the achievement of business results. And every manager is different in terms of personality, thinking style, competencies, etc. It’s this mix of conditions and personal characteristics that make managers' behaviors different

COMPONENTS OF THE IMM Objectives Objectives are the intended business results and are reflected in managers’ PBCs (Personal Business Commitments). Managers are either given objectives or they define their own, hopefully aligned with the goals and objectives of their larger organizations.

Conditions Staffing, processes, time, legal, ethics, etc. • Lead Business results

• Manage Personal characteristics Competencies, thinking styles, experience, personality, etc.

• Do

Climate

Objectives

The Individual Management Model (IMM)

PART 2 THE ORGANISATIONAL SETTING

CASE STUDY 5.1

The roles of the manager and the Individual Management Model THE INDIVIDUAL MANAGEMENT MODEL (IMM)

182

Mergers and acquisitions: the consequences of expansion at Square Deal plc

■ The jobs of individual managers differ widely. Empirical studies have concentrated on the diversity of management and differences in the nature of managerial work. These studies have drawn attention to such features as: managerial roles; agendasetting and network-building; what real managers do; and demands, constraints and choices in a managerial job.

Management in action: real-world examples ensure that students identify and engage with managerial challenges

an active perception stage which gives attention to stimuli from the environment; a second mentally active stage which makes sense of the information; finally, a restructuring and storage phase.




Foodrich plc was, until last year, a family firm which canned fruit and vegetables from its one factory situated about 100 miles from London, in the west of England. It was bought by Square Deal International Inc with the idea that it would supply ‘own label’ products to Arnold plc and large catering packs to both Arnold’s and Carlton’s restaurants. To do this, Foodrich was obliged to deny supplies to some of its regular customers and re-equip part of its plant to handle the large catering packs. The MD, son of the founder, has worked there for nearly 40 years and runs the company, making all decisions, both long term and operational, using his experience and intuition. He is furious to learn that Arnold has not put all its ‘own label’ business in his direction and Carlton is still buying most catering packs from Foodrich’s competitors while its new plant is grossly

YOUR TASKS (a) Discuss the benefits and drawbacks of judging performance on a single criterion such as: (i) revenue, in the case of the store managers; (ii) return on investment, in the case of Carlton’s MDs. (b) Explain to what extent Arnold’s head buyer and Carlton’s head chef are justified in buying catering packs from other companies. (c) Describe how further computerisation might help in this quest for unification and profit improvement.

Photo: Robert Lawson/Anthony Blake Picture Library

Chapter openers: provide a brief introduction to key themes of the chapter

(d) After you have finished this task, the MD tells you he is toying with the idea of regrouping the company under the name of Square Deal plc and dividing it into the following divisions, each operating as a profit centre: Square Deal plc Restaurants Property Food retail Canning division division division division

Bakery division

He is concerned about the effects of such a change on the morale of the managers and other employees so he asks you for a further statement. Discuss ideas that should maintain or improve morale if this regrouping were to take place. (e) Highlight any other advantages or difficulties that you foresee in the regrouping idea.

GUIDED TOUR OF THE BOOK

Review and discussion questions: assess students’ understanding and progress

Critical reflections: motivate students to think critically about key themes

Assignments: imaginative activities enable students to learn through personal application of theory Business Press: Financial Times articles demonstrate contemporary relevance of theory in journalistic style

Personal awareness and skills exercises: practise and develop students’ interpersonal and work-based skills

xxi

GUIDED TOUR OF THE COMPANION WEBSITE

GUIDED TOUR OF THE COMPANION WEBSITE

xxiv

xxv

GUIDED TOUR OF THE COMPANION WEBSITE

Part 1 MANAGEMENT AND ORGANISATIONAL BEHAVIOUR

Part 1 MANAGEMENT AND ORGANISATIONAL BEHAVIOUR

Part 7 MANAGEMENT OF HUMAN RESOURCES

Part 2 THE ORGANISATIONAL SETTING

Part 3 THE ROLE OF THE MANAGER

Part 8 IMPROVING ORGANISATIONAL PERFORMANCE Part 4 THE INDIVIDUAL

Part 6 ORGANISATIONAL STRUCTURES

Part 5 GROUPS AND TEAMWORK

Dogbert’s Theory of Delegation

1

INTRODUCTION

The concepts and ideas presented in this book provide a basis for the critical appraisal of contrasting perspectives on the structure, operation and management of organisations, and interactions among people who work in them. It is hoped that this will encourage a greater level of awareness of, and sensitivity to, the organisational factors and management processes influencing the behaviour and performance of people at work.

LEARNING OUTCOMES After completing this chapter you should be able to:

Photo: NASA


explain the main features, aims and scope of this book;
detail the main features of the seventh edition;
outline the main contents of the book and explain your study of the book;
comment on the changing nature of work organisations;
summarise the study of management and organisational behaviour;
explain the nature, use and value of case studies.

Unlike technological and financial capital, people have a soul. We have hopes and aspirations, we can trust and feel committed, and the trust and commitment we feel profoundly influence our propensity to give ‘beyond the call of duty’. Lynda Gratton Living Strategy: Putting People at the Heart of Corporate Purpose, Financial Times Prentice Hall (2000)

Management is efficiency in climbing the ladder of success; leadership determines whether the ladder is leaning against the right wall. Stephen Covey The 7 Habits of Highly Effective People, Simon and Schuster (1989)

4

PART 1

MANAGEMENT AND ORGANISATIONAL BEHAVIOUR

ABOUT THIS BOOK However much of a cliché it may sound, it is still an inescapable fact that people are the main resource of any organisation. Without its members, an organisation is nothing; an organisation is only as good as the people who work within it. In today’s increasingly global and competitive environment the effective management of people is even more important for organisational survival and success. According to Alderman Sir Roger Cork, former Lord Mayor of London, eighty per cent of business failures are down to bad management.1

It has become acceptable in some areas to regard the academic study of management as at best esoteric and at worst irrelevant. Mastering Management is based on the belief that an academic approach to the study of management has much of real relevance for practising managers. Financial Times Mastering Management Series2

Human capital management (HCM)

As a recent report from the London Business School points out: ‘Human Capital (HC) is increasingly recognised as a key competitive advantage for companies. As well as a key indicator of a company’s success.’ 3 However, despite the frequent protestations by organisations that ‘our employees are our greatest assets’ there is invariably a noticeable failure to measure their value to the organisation or to include their value in financial statements. In 2003 the Secretary of State for Trade and Industry established a task force on human capital management charged with looking at how organisations could measure the quality of their human capital management and report on its impact on business performance. The way an organisation manages its people impacts on its performance. Few would deny this simple statement and numerous company reports and studies have confirmed a link between possession of effective human resource strategies and organisational performance. Research over the past few years has clarified the features of good people management practices associated with high performance and how these can be used strategically, in combination.4

This is the moment when HCM takes its place in the Boardroom. Directors need to transform the airy cliché about people being their greatest asset into a guiding principle of business strategy. Denise Kingsmill, Chair of Task Force on Human Capital Management5

THE AIMS OF THIS BOOK The aims of this book are to: ■ ■ ■ ■

relate the study of organisational behaviour to that of management; provide an integrated view embracing both theory and practice; point out applications of behavioural science within work organisations and implications for management action; indicate ways in which organisational performance may be improved through the better use of human resources and the effective management of people.

CHAPTER 1

INTRODUCTION

The book is written with a minimum of technical terminology and the format is clearly structured. Each chapter is fully supported with illustrations and contains: ■ ■ ■ ■ ■ ■ ■

a short introduction and learning outcomes; a set of contemporary ‘critical reflections’; a synopsis of key points; review and discussion questions; personal awareness and skills exercises; assignment(s) and/or case(s); detailed notes and references.

While a prior knowledge of behavioural science would prove useful to the reader, it is not assumed. Neither is such knowledge a necessary prerequisite for an understanding of the concepts and ideas discussed in this book. Broader social science perspectives form an integral part of the explanation and discussion of management and organisational behaviour. It is hoped that the comprehensive coverage and progressive presentation of contents will appeal to students at undergraduate, graduate or post-experience level in business or management, or on related professional courses. It is also hoped that the book will appeal not only to those aspiring to managerial positions, but to practising managers and supervisors who wish to expand their views and knowledge of the subject area.

The study of organisational behaviour There are a number of alternative approaches to the study of organisational behaviour. For example, in addition to a managerialist approach, Drummond refers to two other intellectual standpoints, interpretative and critical. The interpretative standpoint views ambiguity, paradox and contradictions as part of the natural experiences of organisations, and with an emphasis upon understanding the subtleties and dynamics of organisational life. The critical standpoint believes that reality is very real and people have only a marginal amount of freedom, and regards management science as bogus, a means of legitimising economic exploitation.6 While acknowledging the existence and potential contributions of both these standpoints, the main thrust of this book is to present a managerial approach to organisational behaviour. It is concerned with interactions among the structure and operation of organisations, the process of management and the behaviour of people at work. The underlying theme of the book is the need for organisational effectiveness and the importance of the role of management as an integrating activity.

The scope of this book

No single book could hope to cover adequately all aspects of what is a wide and essentially multidisciplinary field of inquiry, and it is not the intention to attempt to cover all aspects of individual or social behaviour. It is regrettable but inevitable therefore that some topics are excluded or given only limited coverage and it is not possible to meet fully the preferences of all readers. In order to attain a reasonable depth, this book concentrates on selected topics of particular relevance to problems of organisation and the management of people in work situations, and which meet the needs of the intended audience. The nature of organisational behaviour and the practice of management should be considered not in a vacuum but within an organisational context and environment. The activities of a work organisation and the management of people are directed towards an end, towards certain goals. Chapters 4 (The Nature of Organisations) and 5 (Organisational Goals, Strategy and Responsibilities) help to provide an integrated, balanced setting for this book and for your studies of the subject area.

5

6

PART 1

MANAGEMENT AND ORGANISATIONAL BEHAVIOUR

There are, of course, related areas of specialisms such as human resource management (HRM) which also bear upon management action and organisational effectiveness. However, this book is not about employment law and neither is it the intention to attempt to compete with specialist HRM books. Rather, Chapters 19 and 20 serve to recognise the importance of the context in which the process of management and organisational behaviour takes place and to provide an overview and signpost some main HRM areas of interest. Together with Chapters 4 and 5, these chapters aim at broadening the scope of the subject matter beyond the concerns of traditional organisational behaviour texts – a distinctive feature of this book.

THE SEVENTH EDITION The consistently supportive and positive feedback from reviewers and users of previous editions has been very much appreciated. Accordingly this edition retains the same underlying theme, aims and approach that have been a hallmark of the success of the book. Continuing attention has been given to the overall layout, style and appearance. Readers familiar with the previous edition may wish to note the following features of this seventh edition. ■

■

■ ■

■ ■ ■ ■ ■

■

The opportunity has been taken for a comprehensive and detailed review of all contents, including attention to chapter titles and introductions; the organisation, flow and coherence of all material; and restructuring both within and between chapters. Significant changes include ‘Organisational Practices’ brought forward to Chapter 2 from Chapter 16; and delegation and empowerment removed from Chapters 6 and 16 and consolidated and expanded in Chapter 21. Changes have been made to the titles of a number of chapters in order to reflect more closely the nature of their contents. There is considerable new material including greater attention to topical issues such as the changing nature of organisations and management, cultural influences and organisational behaviour, business ethics, diversity, leadership, management development, flexible working, stress, human resource management and work/life balance. There are a number of additional and replacement appendices (now called Management in Action), assignments and case studies. There are in excess of 450 new or revised references. Each chapter now includes opening quotations which helps focus attention on an underlying feature of that chapter. The section on ‘About the Contents’ on pages 8–15 now includes a note of main links with other chapters. In order to accommodate the additional and updated contents, careful attention has been given to the deletion of older and possibly outdated material and references, unless believed to be clearly of continuing relevance today. This has demanded many hard choices but has been influenced by the overriding consensus to maintain the book at a reasonable and manageable size. Together these changes hopefully provide not only a sharper and fresher approach but also a more contemporary and robust focus of attention as well as enhanced readability.

In addition to the above there are three significant new features in the book: ■

Personal awareness and skills exercises Each chapter now includes an exercise designed specifically to help further the development of your personal awareness, and your social and work-based skills. The underlying basis of management and organisational activity is human behaviour and the interactions of people. However, we need to remind ourselves that people

CHAPTER 1

INTRODUCTION

bring their own perceptions, feelings and attitudes towards the organisation, systems and styles of management, their duties and responsibilities, and the conditions under which they are working. An important first step in understanding the behaviour of other people is to know and understand yourself. Enhancing your personal awareness and skills should make study and learning more fulfilling, improve your confidence and augment your ability to work well with other people. It should also help boost your employment opportunities. Increasingly, graduate recruiters are placing greater emphasis on key personal and social skills, and attitudes. To this end it is recommended that you maintain a log of the skills attained during your course of study that you can show in future job interviews.

FT

■

Technology online Technology impacts on almost all aspects of management and organisational behaviour. Technology solutions are interactive web exercises which encourage students to explore how technology might be used to solve specific managerial problems.

■

Business Press A new Business Press section provides contemporary articles relating to business and management situations featured in the Financial Times, including links with other most relevant chapters. There are also questions for each article allowing you to critically discuss the issues raised in the articles.

Key integrative features of this book Underlying key issues of management and organisational behaviour have always been an important integrative feature of this book, and continue to be addressed in this edition. These include attention to: ■ ■ ■ ■ ■ ■ ■

organisational democracy with, for example, greater attention to employee participation and empowerment, and the personal touch; structures of people, concerns for the re-evaluation of work/life balance including demands for flexible working arrangements; the importance of the context of culture and the impact of external environmental influences; ethical and social values, the need for organisations to be more transparent and for more open relationships; strategic approaches to human resource management and the effective management of people; renewed focus on effective organisational performance including primary objectives of survival, growth and development, and profitability; interrelationships among management, organisational behaviour, goals and strategy, human resource management and organisational effectiveness.

7

8

PART 1

MANAGEMENT AND ORGANISATIONAL BEHAVIOUR

About the contents The book is divided into eight interrelated Parts, see Figure 1.1, and 23 chapters.

Part 1 MANAGEMENT AND ORGANISATIONAL BEHAVIOUR

Part 7 MANAGEMENT OF HUMAN RESOURCES

Part 2 THE ORGANISATIONAL SETTING

Part 3 THE ROLE OF THE MANAGER

Part 8 IMPROVING ORGANISATIONAL PERFORMANCE Part 4 THE INDIVIDUAL

Part 6 ORGANISATIONAL STRUCTURES

Part 5 GROUPS AND TEAMWORK

Figure 1.1 Interrelated parts of the book This chapter explains the nature, aims and main features about this book, and introduces you to the changing nature of the work organisation, and to the study of management and organisational behaviour.

Part 1 Management and Organisational Behaviour

Chapter 2: The Nature of Organisational Behaviour looks at the nature of organisational behaviour and the importance of the people–organisation relationship. Chapter 2 draws attention to main influences on the behaviour and performance of people in the work situation, and the central focus of management.

Links with other chapters debates the idea of a social responsibility of management discusses Theory X and Theory Y strategies of managerial behaviour identifies the concept of ‘selective perception’ explains the Johari Window framework of behaviour includes reference to culture as a contingent factor discusses applications of quality circles and the nature of the work/life balance Chapter 23 explores the nature of organisational effectiveness

Chapter 5 Chapter 7 Chapter 11 Chapter 14 Chapter 16 Chapter 18

CHAPTER 1

INTRODUCTION

Chapter 3: Approaches to Organisation and Management contrasts major trends in the development of management thinking and provides a basis for consideration of topics discussed in following chapters. Chapter 3 reviews different approaches to organisation and management, and the relationship between theory and management practice.

Links with other chapters Chapter 4 Chapter 6 Chapter 13 Chapter 15 Chapter 16 Chapter 19 Chapter 22

Part 2 The Organisational Setting

examines the organisation as an open system sets out principles of management to help general discussion on management theory discusses the importance of group norms and social relationships details common principles of organisation applicable to all situations explains contingency models of organisation and management discusses the unitary and pluralistic perspectives of organisations reviews the nature of organisational conflict

Chapter 4: The Nature of Organisations recognises the importance of the organisational setting and external environment within which the process of management takes place. Chapter 4 examines the organisation as a complex social system, and interrelationships among its operations, structure and management.

Links with other chapters Chapter 1 Chapter 3 Chapter 5 Chapter 6 Chapter 13 Chapter 16 Chapter 17 Chapter 23

draws attention to the changing nature of work organisations reviews developments in management thinking and organisational behaviour discusses the significance of organisational goals and objectives discusses management in private and public sector organisations explains the importance and nature of groups and teams refers to contingency models of organisation and management explores the nature of technology and organisations includes a discussion of the learning organisation

Chapter 5: Organisational Goals, Strategy and Responsibilities draws attention to the importance of organisational goals and strategy for the operations and management of the organisation. Chapter 5 considers organisational ideologies and objectives, the concept of social responsibilities of management and business ethics.

Links with other chapters discusses the new psychological contract including responsibilities to employees Chapter 4 explains the context of the organisational setting including a systems view of organisations Chapter 7 examines the approach of Management by Objectives (MBO) Chapter 15 reviews the nature of organisation structure and design Chapter 21 looks at the concepts of power, involvement and compliance Chapter 22 examines the nature and management of organisational change Chapter 2

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Part 3 The Role of the Manager

Chapter 6: The Nature of Management examines the process of management as the cornerstone of the people–organisation relationship and fundamental to effective performance. Chapter 6 reviews the essential nature of managerial work, the nature and main activities of management, and the execution of work.

Links with other chapters Chapter 4 Chapter 7 Chapter 15 Chapter 21 Chapter 22 Chapter 23

distinguishes between production and service organisations, and explains the systems approach to organisations examines managerial behaviour and effectiveness sets out Urwick’s principles of organisation and also different levels of organisation discusses the nature of delegation and empowerment explores the nature of organisational culture and climate examines management development including Management Standards, and the Leadership and Management model

Chapter 7: Managerial Behaviour and Effectiveness recognises the responsibility of managers to manage and to achieve results through the efforts of other people. Chapter 7 considers different systems and styles of managerial behaviour, the effective utilisation of human resources and managerial effectiveness.

Links with other chapters refers to successful management as the ability to handle people effectively, and also to the psychological contract Chapter 6 examines the nature of management Chapter 8 discusses the nature of managerial leadership Chapter 12 explains Maslow’s hierarchy of needs model Chapter 13 refers to role expectations and self-established role prescriptions Chapter 19 discusses the Investors in People Standard for training and development Chapter 2

Chapter 8: The Nature of Leadership explores the process of managerial leadership as a central feature of improved organisational performance. Chapter 8 looks at the exercise of leadership power and influence, leadership as an aspect of behaviour, and the importance of situational variables.

Links with other chapters discusses management as getting work done through the fforts of other people examines managerial behaviour and effectiveness includes an account of expectancy theory of motivation examines the nature of work groups and teams discusses task functions and maintenance functions of leader-member behaviours Chapter 23 refers to the Leadership and Management Model as a framework for effective role model leadership Chapter 6 Chapter 7 Chapter 12 Chapter 13 Chapter 14

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Part 4 The Individual

INTRODUCTION

Chapter 9: Individual Differences draws attention to the importance of the individual’s contribution to the performance of work organisations. Chapter 9 focuses on individual differences, the significance of personality and attitudes, and the recognition of individual talent and potential.

Links with other chapters Chapter 3 Chapter 10 Chapter 11 Chapter 12 Chapter 14 Chapter 18 Chapter 20

refers to the sex power differential in the Hawthorne experiments examines an understanding of the ways in which people learn discusses the process of perception and the impact of gender differences explores the nature and causes of frustration-induced behaviour explains the Johari Window framework of behaviour examines the nature, causes and consequences of stress at work details procedures for the recruitment and selection of staff, and the use of tests

Chapter 10: The Nature of Learning explores the significance of learning to organisational behaviour, and as an important factor in managing change and motivating employees. Chapter 10 explains the nature of the learning process, knowledge management, the learning organisation and evaluates theories of learning.

Links with other chapters Chapter 9 Chapter 12 Chapter 13 Chapter 15 Chapter 17 Chapter 22 Chapter 23

examines the nature of individual differences discusses the motivation of knowledge workers refers to possible stress from situations of role ambiguity looks at the impact of organisation structures on behaviour at work examines the impact of technology on organisations explains the learning organisation as a feature of organisation development discusses management development as an essential feature of organisational effectiveness

Chapter 11: The Process of Perception considers the nature of the perceptual process and the importance to the manager of the study of perception. Chapter 11 explains factors influencing perception and draws particular attention to an understanding of problems regarding the perception of other people.

Links with other chapters Chapter 2 introduces the concept of the psychological contract Chapter 7 discusses Theory X and Theory Y strategies of managerial behaviour Chapter 9 explains the Myers-Briggs Type Indicator Chapter 10 explores an understanding of the nature of learning and the ways in which people learn Chapter 12 examines process theories of motivation Chapter 14 refers to perception of ‘self’ and how people see and think of themselves

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Chapter 12: Work Motivation and Rewards examines those areas that influence the motivation of staff and which elicit their willing co-operation and improved performance. Chapter 12 reviews different theories and ideas about motivation and rewards, and evaluates their relevance to particular work situations.

Links with other chapters introduces the concept of the psychological contract and also refers to culture and motivating factors Chapter 3 discusses the ideas of scientific management and the rational-economic concept of motivation Chapter 6 refers to management as getting work done through other people Chapter 7 examines the approach of Management by Objectives (MBO) Chapter 11 explains Attribution theory as part of process theories of motivation Chapter 18 discusses work organisation and job design, and job enrichment Chapter 2

Part 5 Groups and Teamwork

Chapter 13: The Nature of Work Groups and Teams looks at the nature and significance of work groups and teams as a major feature of organisational life. Chapter 13 considers those factors which influence group formation and cohesiveness and the importance of groups and role relationships for organisational performance.

Links with other chapters refers to the power of group membership and the Hawthorne experiments, and also to the effects of changing technology Chapter 4 explains social processes and the informal organisation Chapter 8 examines the process of leadership linked to the activities of groups Chapter 14 examines working in groups and teams Chapter 15 looks at formal organisational relationships and the matrix form of organisation Chapter 18 discusses role stress as an influence on job satisfaction and performance Chapter 3

Chapter 14: Working in Groups and Teams reviews the importance of understanding the nature of working in groups and teams, and interactions among members. Chapter 14 gives attention to the analysis of behaviour of individuals in group or team situations, and the assessment of performance and effectiveness.

Links with other chapters Chapter 7 Chapter 8 Chapter 12 Chapter 13 Chapter 18 Chapter 19

refers to the Blake and Mouton Managerial Grid seminars for reviewing patterns of behaviour discusses leadership development and effectiveness explains achievement motivation examines the nature of work groups and teams discusses a group of people in quality circles, and also self-managed work groups draws attention to training in people skills and teamworking

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Part 6 Organisational Structures

INTRODUCTION

Chapter 15: Organisation Structure and Design provides an overview of the nature and importance of structure for effective management and organisational performance. Chapter 15 details key factors to be considered in the design of structure, and considers the relationships between organisation structure and people.

Links with other chapters discusses the idea of common sets of principles on organisation looks at the informal organisation and also refers to information technology as a dimension of structural design Chapter 5 explains the importance of organisational goals and objectives Chapter 7 refers to the changing nature of the work organisation and the hierarchy Chapter 13 discusses role relationships and interactions, and role incongruence Chapter 16 examines patterns of structure and work organisation Chapter 3 Chapter 4

Chapter 16: Patterns of Structure and Work Organisation recognises the situational variables that influence the most appropriate organisation structure and systems of management. Chapter 16 examines the importance of alternative forms of structure, the demand for flexibility.

Links with other chapters Chapter 2 Chapter 4 Chapter 5 Chapter 15 Chapter 18 Chapter 21 Chapter 22

draws attention to national culture and principles of contingency theory discusses types of organisations and their purpose refers to the fallacy of the single business objective examines organisation structure and design considers the influence of flexibility on job satisfaction of staff discusses the nature and importance of delegation and empowerment examines the significance of the culture of the organisation

Chapter 17: Technology and Organisations explains the pervasive nature of technology within contemporary organisations and a variety of perspectives. Chapter 17 considers the importance of organisational and human dimensions of the adoption and implementation of new technology.

Links with other chapters explains the nature of organisational behaviour and draws attention to the importance of people Chapter 3 discusses the system approach to the analysis of organisations Chapter 4 draws attention to the influence of technology, information technology and the management of technical change Chapter 18 discusses main dimensions of job satisfaction including reference to alienation at work Chapter 19 explores the role of personnel/HRM specialists Chapter 22 draws attention to human and social factors associated with the need for organisations to adapt to new technological developments Chapter 2

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Part 7 Management of Human Resources

Chapter 18: Job Satisfaction and Work Performance considers the meaning and nature of job satisfaction and the relationship between staff and their jobs. Chapter 18 reviews dimensions of job satisfaction, main approaches to improving job design, and relationships between job satisfaction and work performance.

Links with other chapters Chapter 2 Chapter 4 Chapter 5 Chapter 12 Chapter 14 Chapter 16 Chapter 21

referes to a number of interrelated influences on behaviour draws attention to developments in technical systems and dangers of information overload discusses the importance of social responsibilities of organisations explores the nature and causes of frustration-induced behaviour, and also discusses job design discusses the importance of effective teamworking considers demands for greater flexibility in patterns of work organisation explains the nature, importance and benefits of empowerment

Chapter 19: Human Resource Management draws attention to the importance of the promotion of good human relations for improved organisational performance. Chapter 19 provides an overview of the human resource management function, personnel policies and activities, and the nature of employee relations.

Links with other chapters Chapter 3 Chapter 5 Chapter 7 Chapter 11 Chapter 13 Chapter 18 Chapter 20 Chapter 23

refers to the unitary and pluralistic view of organisations debates the importance of social responsibilities of management examines the approach of Management by Objectives (MBO) draws attention to the possible effects of perceptual distortions explains role incongruence and role conflicts discusses a quality of working life (QWL) strategy examines resourcing the organisation explores the nature and importance of management development

Chapter 20: Resourcing the Organisation recognises that the effectiveness of an organisation depends very largely upon the staff it employs. Chapter 20 looks at the importance of effective systems and procedures for resourcing the organisation, and a planned and systematic approach to recruitment and selection.

Links with other chapters Chapter 9 discusses the features and limitations of testing Chapter 11 draws attention to verbal and non-verbal cues, and also to possible perceptual distortions and errors Chapter 14 explains buddy rating or peer rating as the basis of sociometry, and also scoring measures for leaderless group discussions Chapter 18 discusses a quality of working life (QWL) strategy Chapter 19 examines Human Resource Management

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Part 8 Improving Organisational Performance

INTRODUCTION

Chapter 21: Organisational Control and Power explores the nature of control and power as an integral part of the process of management and the people–organisation relationship. Chapter 21 details the characteristics of an effective control system, and considers broader perspectives of organisational power including delegation and empowerment.

Links with other chapters Chapter 2 Chapter 3 Chapter 4 Chapter 7 Chapter 8 Chapter 18 Chapter 22

introduces the concept of the ‘Peter Principle’ discusses ‘Taylorism’ and the ideas of scientific management consider the organisational setting and the nature of organisations discusses Theory X and Theory Y strategies of managerial behaviour explains main sources of power and leadership influence discusses improving job satisfaction and getting the best out of people explores the importance of organisational culture and climate

Chapter 22: Organisational Development (Culture, Conflict and Change) reviews the meaning, nature and main features of organisation health and development (OD). Chapter 22 draws attention to the importance of understanding culture and climate, organisation conflict and in particular the successful management of change.

Links with other chapters Chapter 2 Chapter 3 Chapter 11 Chapter 12 Chapter 15 Chapter 19 Chapter 23

looks at the use of metaphor to see organisation and management, and also to the meaning of the term ‘organisational behaviour’ refers to the structuralist approach to organisations and management examines the importance of differences in perception discusses equity theory of motivation details Woodward’s study of management organisation of firms discusses the unitary perspective of the organisation examines management development and organisational effectiveness

Chapter 23: Management Development and Organisational Effectiveness concludes by reviewing the importance of effective management as central to organisation development and improved work performance. Chapter 23 looks at the nature of management development, dimensions of organisational effectiveness and reminds us of the importance of people.

Links with other chapters explores the nature of organisational behaviour and draws attention to the importance of organisational effectiveness Chapter 4 examines the organisational setting and nature of organisations Chapter 6 refers to the nature of management in the public sector Chapter 7 discusses managerial behaviour and effectiveness Chapter 10 draws attention to coaching and mentoring, the concept of the learning organisation, and knowledge management Chapter 12 examines different theories of motivation Chapter 19 discusses Investors in People Standard, and also performance appraisal Chapter 2

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YOUR STUDY OF THE BOOK This book adopts an applied approach to the search for the most appropriate ways of improving organisational performance and effectiveness. The objective analysis of organisations is supported, where appropriate, by a more prescriptive stance. For example, the underlying need to establish a framework of order and system of command by which the work of the organisation is undertaken demands that attention be given to certain basic principles and consideration of structure. General principles and prescriptions apply equally to all types of work organisations which achieve their goals and objectives through the process of management. It is possible that the more practically minded reader may wish to concentrate greater attention on the latter parts of certain chapters. However, even a cursory examination of earlier sections of the chapter will help provide an understanding of underlying studies upon which discussion of practical applications is based. The notes and references given at the end of each chapter are to encourage you to pursue further any issues of particular interest. A simple numbering system has deliberately been maintained in order to keep the main text uncluttered and easier to follow, to provide more detailed and specific referencing, and because feedback indicates this system appears to be favoured by most readers.

Questions, assignments and case studies

You are invited to test your knowledge and understanding of the contents by attempting the review and discussion questions at the end of each chapter. These questions provide a basis for revision and review of progress. You are also invited to undertake the assignment(s) and/or case(s) at the end of each chapter. The questions, assignments and case studies provide an opportunity to relate ideas, principles and practices to specific work situations, to think and talk about major issues, and to discuss and compare views with colleagues. In order to help relate the contents of the chapters to real-life situations, many of the questions and assignments ask you to support your discussion with, and/or to give, examples from your own organisation. This can of course be your own college or college department. Alternatively, you may have work experience, even part-time or casual employment, in other organisations that you may draw upon and share with colleagues.

A modular approach

Initiatives such as semesterisation and modularisation are now common in higher education. This book provides comprehensive coverage of a wide range of topic areas related to the effective use of human resources within the work situation. Although there is a logical flow to the sequencing of topic areas, each Part and each chapter of the book is self-contained. Accordingly, if you come across some repetition of references to underlying central features of organisational behaviour and modern management this should provide useful reinforcement of your studies. Main sections are identified clearly within each chapter and there are detailed headings and sub-headings. An important and distinctive feature of this book is that it is especially suitable across a range of different but related modules, including both single or double semester units, and will help to provide an integrated approach to your studies. The selection and ordering of chapters can be varied to suit the particular demands of your study courses or your interests.

Organisational environment and culture

In approaching your studies, you need to bear in mind the importance of the organisational setting, organisational environment and culture. Remember also there are variations in systems and styles of management, and in the choice of managerial behaviour. You may wish to consider the following simple, five-stage framework (Figure 1.2).

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INTRODUCTION

Figure 1.2 A basic framework of study You are encouraged to complement your reading of the book by drawing upon your own experience of work organisations. Search for and study examples of management and organisational behaviour. Look for good and bad examples of management activities and practices, and consider reasons for their apparent success or failure. Compare critically the practical examples given in the text and appendices with the procedures and practices in your own organisation. Consider the manner in which concepts and ideas presented in this book can best be applied in particular work situations. Contemporary examples from your own observations should help further your interest in the subject area and illustrate practical applications to real-life situations.

THE CHANGING NATURE OF WORK ORGANISATION The effective management of people takes place in the context of the wider environmental setting, including the changing patterns of organisations and attitudes to work. It is frequently documented that a global economy, increased business competitiveness, the move towards more customer-driven markets, advances in scientific knowledge, especially telecommunications and office automation, have led to a period of constant change and the need for greater organisational flexibility. This is a recurring theme throughout the book. The power and influence of private and public organisations, the rapid spread of new technology, and the impact of various socio-economic and political factors have attracted increasing attention to the concept of corporate social responsibilities and business ethics. Increasing attention is also being focused on the ethical behaviour which underlies the decisions and actions of managers and staff; and many responsible organisations and professional bodies now choose to publish a Code of Ethics. The changing nature of organisations and individuals at work has placed increasing pressure on the awareness and importance of new psychological contracts. Forces of global competition and turbulent change make employment guarantees unfeasible and demand a new management philosophy based on trust and teamwork. People are seen as a responsibility and a resource to be added to. Employees need to abandon the stability of lifetime employment and embrace the concept of continuous learning and personal development.7 According to an ESRC publication, in any analysis of the transformation of Britain’s employment relations we cannot neglect the changing nature of work. The influence of technological innovation, work restructuring and job redesign are all helping to reshape shopfloor attitudes among managers, unions and workers.8 In their discussion of the twenty-first century organisation, Bouchikhi and Kimberly refer to the customised workplace which represents a radical departure from commonly

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Table 1.1 Contrasting the paradigms 19th century

20th century

21st century

Theory of personhood

Interchangeable muscle and energy

A subordinate with a hierarchy of needs

Autonomous and reflexive individual

Information and knowledge

The province of of management alone

Management-dominated and shared on a limited basis

Widely diffused

The purpose of work

Survival

Accumulation of wealth and social status

Part of a strategic life plan

Identification

With the firm and/or with the working class

Identify with a social group and/or the firm

The disenfranchised self

Conflict

Disruptive and to be avoided

Disruptive but tolerated and can be settled through collective bargaining

A normal part of life

Division of labour

Managers decide, employees execute

Managers decide, employees execute thoughtfully

Employees and managers decide and execute

Power

Concentrated at the top

Limited, functional sharing/empowerment

Diffused and shared

Source: Bouchikhi, H. and Kimberly, J. R., ‘The Customized Workplace’, in Chowdhury, S., Management 21C, Financial Times Prentice Hall (2000), p. 215.

accepted management principles and techniques. They summarise the main differences between nineteenth, twentieth and twenty-first century management – see Table 1.1.9

New approaches to management and organisational behaviour In discussing new approaches to management practices for the next decade, Muzyka suggests that: ‘Organizational behavior has moved from an emphasis on the structural aspects of functional and cross-functional organizations to more flexible models, including enhanced consideration of short-term, high performance teams.’ New ideas of how to motivate and deploy people have developed. A new contract is evolving that involves the exchange of value. Individuals need to be encouraged and permitted to achieve: to perform to their highest potential, for their benefit and that of the employer. Organizations are encouraging staff to craft more flexible, value-laden, and specific rules governing their relationships.10

Cloke and Goldsmith refer to the age of traditional management coming to an end and the decline of hierarchical, bureaucratic, autocratic management. They contend that management is an idea whose time is up and organisations that do not recognise the need to share power and responsibility with all their workers will lose them.11

The nature and importance of e-business What is an e-business? When you get down to it, an e-business is an organisation that connects critical business systems directly to their customers, employees, partners and suppliers, via intranets, extranets and over the Web. As customers, employees, suppliers and distributors are all connected to the business systems and information they

CHAPTER 1

INTRODUCTION

need, e-business actually transforms and integrates key business processes. In short, the definition of e-business is: ‘the transformation of key business processes using Internet technologies’. Why e-business? First, organisations of all sizes are impacted by globalisation and deregulation, which lowers barriers to entry and dramatically reshapes the competitive landscape. Second, people now have a broader array of choices and therefore are becoming more sophisticated and more demanding – both in what they want from a supplier but also how they choose to acquire goods and services. Thus, the need to change your organisation to stay ahead of competition is vital. Every process of an enterprise – from employee training to product development – is going to be subject to this transformation. E-business strategy organisations must unlock the power of the information and data that exist – interactions with websites, file cabinets, desk drawers, databases, and the collective experience of employees. This intellectual capital is a most valuable asset, but only when it is leveraged for competitive advantage.12 Kermally suggests that becoming an e-business is now an imperative for all types of organisations, large and small. The key success factor lies in not emulating established habits. Leadership in the new economy needs to: ■ ■ ■ ■ ■ ■ ■

enthuse employees; empower and respect employees; create trust throughout the organisation; understand the importance of knowledge as a source of business energy; identify and leverage intangible assets; be a custodian of corporate governance in the age of the Internet; be willing to engage in ‘constructive destruction’, since e-business requires constant renewal of its business model.13

It is important, however, to remember the human element to business and that it is people who have to decide what information is actually needed, to ensure the best use of technology, and to design systems that work for them and their organisations. ‘It’s people who manage knowledge – not computers.’14

THE STUDY OF MANAGEMENT AND ORGANISATIONAL BEHAVIOUR The use of separate topic areas is a recognised academic means of aiding study and explanation of the subject. In practice, however, the activities of an organisation and the job of management cannot be isolated neatly into discrete categories. The majority of actions are likely to involve a number of simultaneous functions that relate to the total processes of management.15 Consider, for example, a manager briefing departmental staff on an unexpected, important and urgent task which has to be undertaken quickly. Such a briefing is likely to include consideration of goals and objectives, organisation structure, management system, process of delegation and empowerment, systems of communication, leadership style, motivation and control systems. The behaviour of the staff will be influenced by a combination of individual, group, organisational and environmental factors. Topic studies in organisational behaviour should not be regarded, therefore, as entirely free-standing. Any study of organisation and management inevitably covers several aspects, and each study can be used to a greater or lesser extent to confirm generalisations made about particular topic areas. The use of the same studies to illustrate different aspects of management and organisational behaviour serves as useful revision and reinforcement, and helps to bring about a greater awareness and understanding of the subject.

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No single right answer

You will probably be aware that a feature of the study of management and organisational behaviour is the invariable difficulty in identifying a single solution to a particular problem. The absence of one, right answer can make study of the subject complex and frustrating; but the area of study can also be interesting and challenging, stimulating creative thought and ideas, and it can be related to your own work experience. A useful model for the study of management and organisational behaviour is to see the organisation as an open system (see Chapter 4). The open system approach views the organisation within its broader, external environment and places emphasis on multiple channels of interaction. It provides a means of viewing the total organisation and of embracing different dimensions of analysis. The open system model provides a perspective for a managerial approach to organisational behaviour. It helps in the search for the most appropriate ways of influencing the behaviour of people within an organisational setting.

The relevance of theory

In the study of management and organisational behaviour you will come across many theories. However, you should not be put off by the use of the word ‘theory’. Most rational decisions are based on some form of theory. Theory contains a message on how managers might behave. This will influence attitudes towards management practice and lead to changes in actual patterns of behaviour. Theory helps in building generalised models applicable to a range of organisations or situations. It further provides a conceptual framework and gives a perspective for the practical study of the subject. Thus theory and practice are inseparable. Together they lead to a better understanding of factors influencing patterns of behaviour in work organisations and applications of the process of management.16 However, to be of any help to the practising manager, theory has to be appropriate. For example, Lee refers to: ... the danger of adopting theories because they are teachable, rather than because they are effective ... (however) without appropriate theory, there would be very little communication of the insights of scientific theory to practising managers.17

Although it is not always easy to establish their exact origins, ideas do percolate through to best practice.18 Patching suggests that all managers who think about what they do are practical students of organisational theory. Theory is not something unique to academics, but something we all work with in arriving at our attitudes, beliefs and decisions as managers. It seems obvious to most of us that some theories are better than others. Many managerial discussions which we undertake in meetings focus upon trying to agree upon which theory will be best for a particular decision.19

THE USE OF CASE STUDIES 20 Case studies are increasingly popular as a part of the study of management and organisational behaviour. According to Mumford, the case method is, with the exception of lectures, clearly the most widely used method in management education.21 There are a variety of types of case studies and they may be presented in a number of different ways. Case studies range from, for example, a brief account of events which may be actual, contrived or a combination of both; ‘armchair’ cases based on hypothetical but realistic situations, and developed to draw out and illustrate particular points of principle; to complex, multi-dimensional cases giving a fuller descriptive account of actual situations in real organisations. The term ‘case study’ may be extended to include critical incident analysis, role-play and the in-tray (or in-basket) exercise, although these are more methods of training. A case study may require you to work on an individual basis or it may involve group work. It may also specify that you are to assume a particular role, for example as a senior or departmental manager or consultant.

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INTRODUCTION

Objectives of use of case studies

Whatever the nature or form of case studies, a major objective of their use is usually the application of theoretical knowledge to practical situations and/or the integration of knowledge drawn from a number of related disciplines or areas of study. Case studies are basically problem analysis and decision-making exercises. They provide a test of the ability to distinguish real issues from less significant matters. There is unlikely to be a single, right answer. Case studies, therefore, provide the participants with an opportunity to demonstrate analytical ability, logical thinking, judgement and persuasiveness and skills of communication in the presentation of answers. If the case study is undertaken as a group exercise, it also provides a means of assessing both the performance of the group as a whole and the ability of individuals to work effectively as members of the group.22 In reviewing the relevance of the case study method, Orpen suggests that although it may be regarded as out of date by many management teachers and managers, a major reason why cases must form the important element in any management programme is that managing has to do with problem-solving rather than just learning to do things. Although it is often difficult to accomplish, the movement from the lecture method to the case study method of teaching is one that has to be made. ‘After all, management is ultimately about doing the right thing in the circumstances – something learnt by doing cases – not just digesting ideas from teachers.’23 According to Hazard, the case method is least suited to knowledge transmission, and those institutions that have chosen to teach exclusively by cases do themselves and their students a disservice. Case learning works best with older, more experienced students and allows participants to develop skills, to listen to other people, and to understand that there are many ways of approaching a single problem. Case teaching should be viewed as the first step in an action learning hierarchy.24

Guidelines on tackling case studies

The level and depth of analysis, and the type of answer required, will depend upon the particular case study and the reasons for its use. However, despite variations in the nature and format of case studies it is possible to suggest general guidelines on how to tackle them. 1 Read the whole of the case study. Try to get a ‘feel’ for what it is about and note what the question(s) ask(s) you to do. Check on the time allowed. 2 Read the case study a second time. Look at the material carefully and try to identify with the situation. Check again on exactly what you are required to do and instructions on how to present your answer. For example, if a report is called for, your answer should be presented in proper report form. Check whether you are to assume a specific role and if your answer is to be directed at a specified audience – for example, a senior manager, the board of directors or a committee. 3 If there are a number of different parts to the case study you should apportion available time and ‘weight’ your answers accordingly. 4 Approach your analysis of the case study with an open mind. Be conscious of any bias or prejudice you may have and avoid any predispositions which may influence your perception of the case material. Do not jump to hasty or unfounded conclusions. Do not formulate firm opinions or solutions until you have collated all the available evidence. 5 Adopt a brainstorming approach and take the case apart by exploring all reasonably possible considerations. Remember there may be a number of separate problems with separate causes and a number of alternative courses of action. There is not necessarily a single ‘correct’ or ‘model’ answer. 6 You may need to search for hidden meanings and issues which are not at first readily apparent. Do not, however, make things unnecessarily complicated. Do not take the ‘obvious’ for granted and do not neglect simple responses which help to provide a satisfactory answer to the question as worded.

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7 A particular feature of case study work is that you are likely to have only limited information. You should, therefore, make a point of studying all the details given in the case material, first, to make certain of the facts; and second, to identify what deductions or inferences can be drawn from these facts. You may feel it necessary to make certain assumptions. If so, these assumptions should follow reasonably from the case material and serve only to help clarify the situation. Even if you are not specifically requested to do so, it is recommended that you make clear any necessary assumptions as part of your answer. 8 The case study may set out deliberately to present a tangle of information, events or situations which need to be unravelled in order to clarify links and relationships, and to distinguish causes from effects, and symptoms from problems. Concentrate on what you see to be the more important matters as opposed to any irrelevant detail or possible red herrings which may confuse the real issues. 9 In your analysis of the case material you may find it helpful to emphasise key words or phrases, including emotive language and actions. You may also find it helpful to: – list the people involved and draw a pen picture of them from the available information; and – trace the sequence and timing of events which have led to the present situation. The use of margin notes, underlining, numbering and/or lettering, colours or highlighting pens may all be useful but you should be careful not to make your analysis confused or too complicated. 10 Where appropriate, relate your analysis of the case material to your theoretical studies, general points of principle and the work of leading writers. For example, you might find the PESTEL analysis discussed in Chapter 4 or the SWOT analysis discussed in Chapter 5 helpful in tackling case studies. It is always valuable to be able to draw upon practical experience but make sure it is relevant to the particular circumstances. You may still be able to make use of knowledge gained from experience not related directly to the case study, but avoid the temptation to distort your perception of the situation as described to suit your own personal experience. 11 Bearing in mind the question, clearly identify existing or potential difficulties or problem areas and indicate where you see the need for most urgent action. Where you have identified a number of possible courses of action indicate your recommended priorities. Bear in mind also practical considerations such as timing, cost and existing personalities. Where appropriate give reasons in support of your recommendations. 12 Draw up a plan of key points as the basis of your answer. 13 The use of visual displays such as diagrams, charts or tables may enhance the presentation of your answer. But make sure such visual displays are accurate and clear and relate directly to your analysis of the case material, and to the question as worded. Every visual display should be given a meaningful title, and serve to help the reading and interpretation of your answer. Do not be tempted to use visual displays for their own sake or to spend too much time on an over-elaborate display at the expense of more important matters. 14 Allow time to read through and check your work.

REVIEW AND DISCUSSION QUESTION Discuss critically what you believe are the main factors to bear in mind with, and particular difficulties presented by, the study of management and organisational behaviour. Where possible, give practical examples based on your own experience.

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INTRODUCTION

PERSONAL AWARENESS AND SKILLS EXERCISE OBJECTIVES Completing this exercise should help you to enhance the following skills:
Recognise different ways in which people think.
Explain and justify your approach to making decisions.
Participate in a small group discussion.

EXERCISE Five figures are shown below.

You are required to: 1 Select the one that is different from all the others. 2 Discuss in small groups reasons for the individual selections and be prepared to justify your own decision. 3 See if you can reach a consensus on a single group answer.

DISCUSSION ■ To what extent did members of the group understand the thought processes of others? ■ If you were persuaded to change your mind on what basis was this decision made? ■ What conclusions do you draw from this exercise?

Visit our website www.booksites.net/mullins for further questions, annotated weblinks, case material and Internet research material.

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NOTES AND REFERENCES 1. Cited in Robinson, G. ‘Managers Under the Spotlight’, The British Journal of Administrative Management, September/October 1997, p. 5. 2. Bickerstaffe, G. ‘Mastering Management’, Financial Times, 27 October 1995, p. 2. 3. Foong, K. and Yorston, R. ‘Human Capital Measurement and Reporting A British Perspective’, London Business School, June 2003, p. 3. 4. ‘Accounting for People’, Report of the Task Force on Human Capital Management, DTI, October 2003, p. 3. 5. Ibid., p. 2. 6. Drummond, H. Introduction to Organizational Behaviour, Oxford University Press (2000). 7. Ghoshal, S., Bartlett, C. A. and Moran, P. ‘Value Creation: The New Millennium Management Manifesto’, in Chowdhury, S. Management 21C, Financial Times Prentice Hall (2000), pp. 121–40. 8. Taylor, R. ‘The Future of Employment Relations’, Economic and Social Research Council, September 2001, pp. 7–8. 9. Bouchikhi, H. and Kimberly, J. R. ‘The Customized Workplace’, in Chowdhury, S. Management 21C, Financial Times Prentice Hall (2000), pp. 207–19. 10. Muzyka, D. ‘Thriving on the Chaos of the Future’, in Pickford, J. (ed.) Financial Times Mastering Management 2.0, Financial Times Prentice Hall (2001), p. 8. 11. Cloke, K. and Goldsmith, J. The End of Management: and the Rise of Organizational Democracy, Jossey-Bass (2002). 12. For an account of key issues in e-business, see for example: ‘Accenture’, supplement to Management Today, January 2001. 13. Kermally, S. ‘E-strategy is Key to Future Success’, Professional Manager, July 2001, pp. 28–9. 14. Fitzsimmons, G. ‘It’s People Who Manage Knowledge – Not Computers’, The British Journal of Administrative Management, March/April 2000, p. 16.

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15. A similar view is taken by Watson, T. J. Organising and Managing Work: organisational, managerial and strategic behaviour in theory and practice, Financial Times Prentice Hall (2002). 16. See, for example: Billsberry, J. (ed.) ‘There’s Nothing So Practical as a Good Theory: How Can Theory Help Managers Become More Effective?’ in The Effective Manager: Perspectives and Illustrations, Sage Publications (1996), pp. 1–27; and Naylor, J. Management, Financial Times Pitman Publishing (1999), pp. 18–20. 17. Lee, R. A. ‘There is Nothing so Useful as an Appropriate Theory’, in Wilson, D. C. and Rosenfeld, R. H. Managing Organizations: Text, Readings and Cases, McGraw-Hill (1990), p. 31. 18. Crainer, S. ‘The Rise of Guru Scepticism’, Management Today, March 1996, pp. 48–52. 19. Patching, K. Management and Organisation Development, Macmillan Business (1999), p. 11. 20. Based on Mullins, L. J. ‘Tackling Case Studies’, Student Administrator, vol. 1, no. 5, June 1984. See also: Ainsworth, A. ‘Tackling Case Studies’, Supplement to Chartered Secretary, January 2000. 21. Mumford, A. ‘When to Use The Case Method’, ECCHO: The Newsletter of the European Case Clearing House, Autumn/Fall 1997, pp. 16–17. 22. See, for example: Easton, G. Learning From Case Studies, Second edition, Prentice-Hall (1992). 23. Orpen, C. ‘Reconsidering the Case-Study Method of Management Teaching’, Journal of European Business Education, Buckinghamshire Business School, vol. 9, no. 2, May 2000, pp. 56–64. 24. Hazard, H. ‘An Action Learning Teacher Reflects on Case Teaching’, ECCHO: The Newsletter of the European Case Clearing House, Issue No. 22, Autumn/Fall 1999, pp. 5–7.

Use the Financial Times to enhance your understanding of the context and practice of management and organisational behaviour. Refer to article 7 in the BUSINESS PRESS section at the end of the book for relevant reports on the issues explored in this chapter.

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The scope for the examination of behaviour in organisations is very wide. There is a multiplicity of interrelated factors which influence the behaviour and performance of people as members of a work organisation. It is important to recognise the role of management as an integrating activity and as the cornerstone of organisationa effectiveness. People and organisations need each other. The manager needs to understand the main influences on behaviour in work organisations and the nature of the people–organisation relationship.

LEARNING OUTCOMES After completing this chapter you should be able to:
explain the meaning and nature of organisational behaviour and provide an introduction to a behavioural approach to management;
detail main interrelated influences on behaviour in work organisations and explain the nature of behavioural science;
outline contrasting perspectives of organisations and different orientations to work;
recognise the importance of management as an integrating activity;
assess the nature and importance of the new psychological contract;

Photo: Mark Renders/Getty Images

Organizations are extremely complex systems. As one observes them they seem to be composed of human activities on many different levels of analysis. Personalities, small groups, intergroups, norms, values, attitudes all seem to exist in an extremely complex multidimensional pattern. The complexity seems at times almost beyond comprehension. Chris Argyris Integrating the Individual and the Organization, John Wiley & Sons (1964)


review the need for a cross-cultural approach and the importance of culture to the study of organisational behaviour;
summarise the complex nature of the behaviour of people in work organisations.

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THE MEANING OF ORGANISATIONAL BEHAVIOUR We live in an organisational world. Organisations of one form or another are a necessary part of our society and serve many important needs. The decisions and actions of management in organisations have an increasing impact on individuals, other organisations and the community. It is important, therefore, to understand how organisations function and the pervasive influences which they exercise over the behaviour of people.1 Organizational Behaviour is one of the most complex and perhaps least understood academic elements of modern general management, but since it concerns the behaviour of people within organizations it is also one of the most central … its concern with individual and group patterns of behaviour makes it an essential element in dealing with the complex behavioural issues thrown up in the modern business world. Financial Times Mastering Management Series2

The behaviour of people Organisational behaviour is concerned with the study of the behaviour of people within an organisational setting. It involves the understanding, prediction and control of human behaviour.3 Common definitions of organisational behaviour (OB) are generally along the lines of: the study and understanding of individual and group behaviour, and patterns of structure in order to help improve organisational performance and effectiveness.4 There is a close relationship between organisational behaviour and management theory and practice. Some writers seem to suggest that organisational behaviour and management are synonymous, but this is something of an over-simplification because there are many broader facets to management. Organisational behaviour does not encompass the whole of management; it is more accurately described in the narrower interpretation of providing a behavioural approach to management. It is important to emphasise that in most cases the term ‘organisational behaviour’ is, strictly, a misnomer: rarely do all members of an organisation, except perhaps very small organisations, behave collectively in such a way as to represent the behaviour of the organisation as a whole. In practice, we are referring to the behaviour of individuals, or sections or groups of people, within the organisation. For example, when we talk about a ‘caring organisation’, we are really talking about the philosophy, attitudes and actions of top managers and/or departmental managers, or possibly an individual manager. Nevertheless, the wording ‘organisational behaviour’ has become widely accepted and is found increasingly in textbooks and literature on the subject. The term ‘organisational behaviour’ is a convenient form of shorthand to refer to the large number of interrelated influences on, and patterns of, behaviour of people within organisations.5

A framework of study

The behaviour of people, however, cannot be studied in isolation. It is necessary to understand interrelationships with other variables which together comprise the total organisation. To do this involves consideration of interactions among the formal structure, the tasks to be undertaken, the technology employed and methods of carrying out work, the process of management and the external environment.

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Figure 2.1 Organisational behaviour: a convenient framework of analysis The study of organisational behaviour embraces therefore an understanding of: ■ ■ ■ ■ ■

the behaviour of people; the process of management; the organisational context in which the process of management takes place; organisational processes and the execution of work; and interactions with the external environment of which the organisation is part.

This provides us with a basic, but convenient, framework of analysis. (See Figure 2.1.) Wilson, however suggests that the meaning of the term organisational behaviour is far from clear. She challenges what constitutes organisational behaviour and questions whether we should be interested only in behaviour that happens within organisations. There is a reciprocal relationship in what happens within and outside organisations. Wilson suggests that we also look outside of what are normally thought of as organisations and how we usually think of work. We can also gain insight into organisational life and organisational behaviour by looking at what happens in rest and play; by consideration of emotion and feeling; by the context in which work is defined as men’s or women’s work; and by looking at less organised work, for example work on the fiddle and the meaning of work for the unemployed.6 These suggestions by Wilson arguably add an extra dimension to the meaning and understanding of organisational behaviour.

INFLUENCES ON BEHAVIOUR IN ORGANISATIONS The variables outlined above provide parameters within which a number of interrelated dimensions can be identified – the individual, the group, the organisation and the environment – which collectively influence behaviour in work organisations.

The individual

Organisations are made up of their individual members. The individual is a central feature of organisational behaviour and a necessary part of any behavioural situation, whether acting in isolation or as part of a group, in response to expectations of the organisation, or as a result of the influences of the external environment. Where the needs of the individual and the demands of the organisation are incompatible, this can

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result in frustration and conflict. It is the task of management to integrate the individual and the organisation, and to provide a working environment which permits the satisfaction of individual needs as well as the attainment of organisational goals.

The group

Groups exist in all organisations and are essential to their working and performance. The organisation comprises groups of people and almost everyone in an organisation will be a member of one or more groups. Informal groups arise from the social needs of people within the organisation. People in groups influence each other in many ways, and groups may develop their own hierarchies and leaders. Group pressures can have a major influence over the behaviour and performance of individual members. An understanding of group structure and behaviour complements a knowledge of individual behaviour and adds a further dimension to organisational behaviour.

The organisation

Individuals and groups interact within the structure of the formal organisation. Structure is created by management to establish relationships between individuals and groups, to provide order and systems and to direct the efforts of the organisation into goal-seeking activities. It is through the formal structure that people carry out their organisational activities in order to achieve aims and objectives. Behaviour is affected by patterns of organisation structure, technology, styles of leadership and systems of management through which organisational processes are planned, directed and controlled. The focus of attention, therefore, is on the impact of organisation structure and design, and patterns of management, on the behaviour of people within the organisation. For example, McPhee refers to the growth in the nature and importance of organisational structures and their essence, and for greater emphasis on business-to-business (B2B) depth or group interviewing as part of an insight into business and organisational behaviour.7

The environment

The organisation functions as part of the broader external environment of which it is a part. The environment affects the organisation through, for example, technological and scientific development, economic activity, social and cultural influences and governmental actions. The effects of the operation of the organisation within its environment are reflected in terms of the management of opportunities and risks and the successful achievement of its aims and objectives. The increasing rate of change in environmental factors has highlighted the need to study the total organisation and the processes by which the organisation attempts to adapt to the external demands placed upon it. Increasing globalisation means that organisations must respond to different market demands and local requirements. ‘In globalization, strategy and organization are inextricably twined.’8 Globalisation impacts on organisational behaviour, and has placed greater emphasis on processes within organisations rather than functions of the organisation.

Contrasting but related approaches These different dimensions provide contrasting but related approaches to the understanding of human behaviour in organisations. They present a number of alternative pathways for the study of the subject and level of analysis. It is possible, for example, to adopt a psychological approach with the main emphasis on the individuals of which the organisation is comprised. Psychological aspects are important but, by themselves, provide too narrow an approach for the understanding of management and organisational behaviour. Our main concern is not with the complex detail of individual differences and attributes per se but with the behaviour and management of people within an organisational setting. It is also possible to adopt a sociological approach concerned with a broader emphasis on human behaviour in society. Sociological aspects can be important. A number of sociology writers seem set on the purpose of criticising traditional views of

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organisation and management. Many of the criticisms and limitations to which such writers refer are justified and help promote healthy academic debate. Unfortunately, however, much of the argument tends to be presented in the abstract and is lacking in constructive ideas on how, in practical terms, action can be taken to improve organisational performance.

BEHAVIOURAL SCIENCE – A MULTIDISCIPLINARY APPROACH Whatever the approach, the study of organisational behaviour cannot be undertaken entirely in terms of a single discipline. It is necessary to provide a multidisciplinary, behavioural science approach (see Figure 2.2). The wording ‘behavioural science’ has no strict scientific definition. It may be used as a collective term for the grouping of all the social sciences concerned with the study of people’s behaviour. However, it is now more frequently used to refer to attempts to apply a selective, multidisciplinary approach to the study of human behaviour. In particular, the term is often taken as applying more narrowly and specifically to problems of organisation and management in the work environment.

Three main disciplines

There are areas of overlap among the various social sciences, their sub-divisions and related disciplines such as economics and political science. However, the study of behaviour can be viewed in terms of three main disciplines – psychology, sociology and anthropology. All three disciplines have made an important contribution to the field of organisational behaviour. ■

Psychologists are concerned, broadly speaking, with the study of human behaviour, with traits of the individual and membership of small social groups. The main focus of attention is on the individual as a whole person, or what can be termed the ‘personality system’, including, for example, perception, attitudes and motives.

Figure 2.2 Behavioural science – a multidisciplinary approach

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Sociologists are more concerned with the study of social behaviour, relationships among social groups and societies, and the maintenance of order. The main focus of attention is on the analysis of social structures and positions in those structures – for example, the relationship between the behaviour of leaders and followers. Anthropologists are more concerned with the science of mankind and the study of human behaviour as a whole. As far as organisational behaviour is concerned the main focus of attention is on the cultural system, the beliefs, customs, ideas and values within a group or society, and the comparison of behaviour among different cultures – for example, the importance to Muslim women of wearing trousers to work. People learn to depend on their culture to give them security and stability, and they can suffer adverse reactions to unfamiliar environments.

The contribution of relevant aspects of psychology, sociology and anthropology aids our understanding of the behaviour of people in work organisations, and underpins the field of organisational behaviour. Behavioural science attempts to structure organisations in order to secure the optimum working environment. It is concerned with reconciling the needs of the organisation for the contribution of maximum productivity, with the needs of individuals and the realisation of their potential. Emphasis is on the application of relevant aspects of psychological and sociological theory and practice, and cultural influences, to problems of organisation and management in the work situation. In terms of the applications of behavioural science to the management of people, we need also to consider the relevance and applications of philosophy, ethics and the law.

THE IMPORTANCE OF PEOPLE AND ORGANISATIONAL BEHAVIOUR However one looks at the nature or disciplines of organisational behaviour it is important to remember, as Morgan reminds us, that: ‘The reality of organizational life usually comprises numerous different realities!’ 9 Hellriegel, Slocum and Woodman suggest that: … one way to recognise why people behave as they do at work is to view an organisation as an iceberg. What sinks ships isn’t always what sailors can see, but what they can’t see.10

The overt, formal aspects focus only on the tip of the iceberg (organisation). It is just as important to focus on what you can’t see – the covert, behavioural aspects (see Figure 2.3). As part of the Financial Times Mastering Management series, Wood, in his discussion of the nature of organisational behaviour (OB), suggests that in its concern for the way people behave in an organisational context, organisational behaviour can be regarded as the key to the whole area of management. Is the study of behaviour in organisations important? I think it is vital. What the social sciences, humanities and the arts are to university education, OB is to business school education. The more technical a manager’s training, the more important organisational behaviour becomes. It is arguably the one area that can carry the burden of bringing the collective wisdom of human history into the decision-making calculus of developing managers. And this is no trivial task.11

In the Foreword to Cloke and Goldsmith’s thought-provoking book, The End of Management, Bennis claims that a distinct and dramatic change is taking place in the philosophy underlying organisational behaviour, calling forth a new concept of humanity. This new concept is based on expanded knowledge of our complex and shifting needs, replacing an oversimplified, innocent, push-button idea of humanity. This philosophical shift calls for a new concept of organizational depersonalized, mechanistic value system of bureaucracy. With it comes a new concept of power, based on collaboration and reason, replacing a model based on coercion and threat ... The real push for these changes stems from the need not only to humanize organizations, but to use them as crucibles for personal growth and self-realization.12

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Figure 2.3 The organisational iceberg Source: Don Hellriegel, John W. Slocum, Jr and Richard W. Woodman, Organizational Behaviour, Eighth edition, South-Western Publishing © (1998), p. 6. Reprinted with the permission of South-Western, a division of Thomson Learning: www.thomsonrights.com. Fax 800 730 2215.

People, capital and technology In her discussion on ‘putting people at the heart of corporate purpose’, Gratton draws attention to the link between individual behaviour and organisational performance. People are uniquely different from capital and technology. As the challenge shifts from managing capital and technology to managing people, so this requires a fundamental shift in the way we consider resources and has profound implications for the organisations in which we work. If we place people at the center of sustained competitive advantage then we have to take full account of the fundamental characteristics of human capital. What are these fundamental characteristics? What separates us from money or machines, and what are the implications of these differences? My view of this comes essentially from the perspective of an individual psychologist and from my experiences in organizations. For me the question of time is crucial, both because we humans operate in time with the past, the present and the future assuming importance; and because there are phases, sequences of time and rhythms, which are essentially human. Like many other psychologists, I have been influenced by the notion of meaning and of soul. Both are deeply philosophical terms, with roots as old as mankind. They are soft, perhaps even flaky, notions, but I believe to deny them is to create organizations fit for machines, not people. They may not be the terms with which you are most comfortable, perhaps other words suit you better, but somewhere within our views of organizations we need to acknowledge the differences between machines and man.13

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ORGANISATIONAL METAPHORS Organisations are complex social systems which can be defined and studied in a number of different ways. A significant approach to this broad perspective on the nature of organisations and organisational behaviour is provided by Morgan. Through the use of metaphors, Morgan identifies eight different ways of viewing organisations – as machines, organisms, brains, cultures, political systems, psychic prisons, flux and transformation, and instruments of domination. According to Morgan, these contrasting metaphors aid the understanding of the complex nature of organisational life and the critical evaluation of organisational phenomena.14 ■

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Machines. This suggests that organisations can be designed as if they are machines with orderly relations between clearly defined parts. Viewing organisations as machines can provide the basis for efficient operation in a routine, reliable and predictable way. This form of bureaucratic structure provides form, continuity and security. However, it may have adverse consequences and limit the development of human capacities. Organisations viewed as machines function better in a stable and protected environment. Organisms. The organisation is seen as behaving like a living system. In the same way that biological mechanisms adapt to changes in their environment, so organisations, as open systems, adapt to the changing external environment. Organisations operating within a turbulent and dynamic environment require an adaptable type of structure. Brains. Viewing organisations as brains involves thinking about the organisation as inventive and rational, and in a manner that provides for flexibility and creative action. The challenge is to create new forms of organisation capable of intelligent change and that can disperse brainlike capacities. Cultures. This sees organisations as complex systems made up of their own characteristic sets of ideology, values, rituals, and systems of belief and practice. Attention to specific aspects of social development helps to account for variations among organisations. Political systems. In the sense that ways must be found to create order and direct people, organisations are intrinsically political. They are about authority, power, superior–subordinate relationships and conflicting interests. Viewing organisations as political systems helps in an understanding of day-to-day organisational life, the wheeling and dealing, and pursuit of special interests. Psychic prisons. This views organisations as psychic phenomena created and sustained by conscious and unconscious processes. Organisations and their members are constrained by their shadows or ‘psychic prisons’ and become trapped by constructions of reality. Their inherited or created mythical past places affects the representation of the organisation to the outside world. Viewing organisations as psychic prisons provides an understanding of the reality and illusions of organisational behaviour. Flux and transformation. The universe is in a constant state of flux, embodying characteristics of both permanence and change. Organisations can be seen as in a state of flux and transformation. In order to understand the nature and social life of organisations, it is necessary to understand the sources and logic of transformation and change. Instruments of domination. In this view organisations are associated with processes of social domination, and individuals and groups imposing their will on others. A feature of organisations is asymmetrical power relations that result in the pursuit of the goals of the few through the efforts of the many. Organisations are best understood in terms of variations in the mode of social domination and control of their members.

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A broader view of organisational behaviour Although the main concern of this book is with a managerial approach to organisational behaviour, these contrasting metaphors provide an interesting perspective on how to view organisations. They provide a broader view of the dynamics of organisational behaviour, and how to manage and design organisations. However, Morgan points out that these metaphors are not fixed categories and are not mutually exclusive. An organisation can be a mix of each, and predominantly a combination of two or three metaphors. Furthermore, these combinations may change over a period of time. A number of writers involve the use of metaphors to help describe organisations. For example, in discussing the role and logic of viewing the organisation in terms of metaphors, Drummond raises questions such as what an organisation is like, and the power of metaphors in shaping our thinking; but also points out that all metaphors are partial and no metaphor can explain fully a particular phenomenon.15

ORIENTATIONS TO WORK AND THE WORK ETHIC People differ in the manner and extent of their involvement with, and concern for, work. From information collected about the work situation, organisational participation and involvement with work colleagues, and life outside the organisation, Goldthorpe et al. identified three main types of orientation to work: instrumental, bureaucratic and solidaristic.16 ■

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Different work situation

Individuals with an instrumental orientation defined work not as a central life issue but in terms of a means to an end. There is a calculative or economic involvement with work, and a clear distinction between work-related and non-work-related activities. Individuals with a bureaucratic orientation defined work as a central life issue. There is a sense of obligation to the work of the organisation and a positive involvement in terms of a career structure. There is a close link between work-related and non-workrelated activities. Individuals with a solidaristic orientation defined the work situation in terms of group activities. There is an ego involvement with work groups rather than with the organisation itself. Work is more than just a means to an end. Non-work activities are linked to work relationships.

Some people may well have a set motivation to work, whatever the nature of the work environment. However, different work situations may also influence the individual’s orientation to work. For example, the lack of opportunities for teamwork and the satisfaction of social expectations may result in an instrumental orientation to work, and a primary concern for economic interests such as pay and security. In other situations where there are greater opportunities to satisfy social needs, membership of work groups may be very important, and individuals may have a more solidaristic orientation to work. According to Herman, the work ethic has been deeply challenged by two trends – the division of labour and the destruction of continuity in employment. Work has been fractured in task and sub-divided into specialised subtasks or branches into new kinds of work all together. The division of labour has now generated tens of thousands of discrete functions in the workplace. A more recent trend is the destruction of continuity in employment with many employees likely to re-enter the job market multiple times. This discourages the development of bonds of loyalty or employees investing themselves in their work with the hope of long-term employment.17 Knights and Willmott contend that most management textbooks do not make the connection between managing and everyday life. By drawing on a number of contemporary

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novels they attempt to ‘bring to life’ what they see as the reality of managing and organising, and dimensions of human experience at work and elsewhere. They explore, in an interesting way, the changing meaning of work and orientations to it, and how different kinds of work are meaningful to some people and not to others.18

Cultural influences National culture is also a significant influence on orientations to work. For example, Reeves comments on the importance of conversation for effective organisational relationships but how this is resisted in the British work culture. The Protestant version of the work ethic prevails, implying heads-down work, focused agendas, punctuality, efficiency. In French and Spanish offices, it takes the first hour to kiss everyone, the second to discuss local gossip and the third to pop out for a coffee and croissant. In Britain, these activities would count as sexual harassment, time-wasting and absenteeism. Many firms have built cafés or break out areas and then discovered people are too scared to use them for fear of looking work-shy.19

As another example, the author experienced for himself how in parts of Australia workrelated activities could often be undertaken comfortably in local coffee houses without concern about being seen as away from the place of work. Cartwright comments on the psychological process of culture that has the power and authority not only to determine lifestyle but also to form individual personality traits, behaviours and attitudes. It is the cultural environment that motivates people to do their best and to give of their best, often irrespective of or even in spite of their working or living environment. In this respect we make a clear distinction between social conditions and the cultural environment. In the same way that a first-class system does not guarantee first-class results, good living and working conditions do not, in themselves, guarantee high morale and motivation. People in the best working and living conditions can still have low morale and motivation without the benefit of a supportive culture.20

Work/life balance

Popular newspaper articles often suggest that work is still a large component of what gives meaning to people’s lives, and give examples of lottery or pools winners staying in work and often in their same old job. Other surveys and reports continue to suggest that the workplace is no longer a central feature of social activity. For a majority of people the main reason for work remains the need for money to fulfil the necessities of life. However, much still appears to depend on the extent of an individual’s social contacts and activities outside of the work situation. From a survey conducted among subscribers to Management Today, the majority of Britain’s managers are engaged in a perpetual juggling act with the work/life balance, and in meeting both personal and work commitments. For many of those surveyed, however, work remains a huge source of satisfaction.21 The work/life balance is discussed more fully in Chapter 18.

MANAGEMENT AS AN INTEGRATING ACTIVITY Whatever the individual’s orientations to work, it is through the process of management that the efforts of members of the organisation are co-ordinated, directed and guided towards the achievement of organisational goals. Management is an integral part of, and fundamental to, the successful operations of the organisation. Management is therefore the cornerstone of organisational effectiveness, and is concerned with arrangements for the carrying out of organisational processes and the execution of work (see Figure 2.4). There are many aspects to management in work organisations, but the one essential ingredient of any successful manager is the ability to handle people effectively. The man-

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Figure 2.4 Management as the cornerstone of organisational effectiveness ager needs to be conversant with social and human skills, and have the ability to work with and through other people. Without people there can be no organisation and no meaningful activity. Behind every action or document in an organisation there are people.

Patterns of human behaviour

It is the responsibility of management to manage. But organisations can only achieve their aims and objectives through the co-ordinated efforts of their members. This involves the effective management of human resources. However, it is important always to remember that it is people who are being managed and people should be considered in human terms. Unlike physical resources, people are not owned by the organisation. People bring their own perceptions, feelings and attitudes towards the organisation, systems and styles of management, their duties and responsibilities, and the conditions under which they are working. At the heart of successful management is the problem of integrating the individual and the organisation, and this requires an understanding of both human personality and formal organisations.22

The fact is that management ultimately depends on an understanding of human nature. I suggest it goes much further than that. In the first place, good management depends on the acceptance of certain basic values. It cannot be achieved without honesty and integrity, or without consideration for the interests of others. Secondly, it is the understanding of human foibles that we all share, such as jealousy, envy, status, prejudice, perception, temperament, motivation and talent, which provides the greatest challenge to managers. HRH The Duke of Edinburgh, Institute of Management Patron23

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Human behaviour is capricious, and scientific methods or principles of behaviour cannot be applied with reliability. For example, in his study of job satisfaction, Bassett comments that: There seem to be no universal generalizations about worker dissatisfaction that permit easy management policy solutions to absenteeism and turnover problems … There are almost never any exact conditions of cause and effect in the realm of human behaviour.24

It is also widely observed that you cannot study the behaviour of people without changing it. Patterns of behaviour are influenced by a complex combination of individual, social and cultural factors. Tensions, conflicts and politics are almost inevitable, as are informal structures of organisation and unofficial working methods. We need to remind ourselves of the human aspects of the organisation and the idiosyncratic behaviour of individuals. For example, Egan refers to the importance of the shadow side of the organisation: that is, those things not found on organisation charts or in company manuals – the covert, and often undiscussed, activities of people which affect both the productivity and quality of working life of an organisation.25

The people–organisation relationship In the belief of the author, the majority of people come to work with the original attitude of being eager to do a good job, and desirous of performing well and to the best of their abilities. People generally respond in the manner in which they are treated. Where actual performance fails to match the ideal this is largely a result of how staff perceive they are treated by management and the management function. Many problems in the people–organisation relationship arise not so much from what management does, but the manner in which it is done. Often, it is not so much the intent but the manner of implementation that is the root cause of staff unrest and dissatisfaction. For example, staff may agree on the need to introduce new technology to retain the competitive efficiency of the organisation, but feel resentment about the lack of pre-planning, consultation, retraining programmes, participation in agreeing new working practices and wage rates, and similar considerations arising from the manner of its introduction. Therefore, a heavy responsibility is placed on managers and the activity of management – on the processes, systems and styles of management. Accordingly, how managers exercise the responsibility for, and duties of, management is important. Attention must be given to the work environment, and appropriate systems of motivation, job satisfaction and rewards. It is important to remember that improvement in organisational performance will only come about through people.26

Providing the right balance

Management should, therefore, endeavour to create the right balance between the interrelated elements which make up the total organisation, and to weld these into coherent patterns of activity best suited to the external environment in which the organisation is operating. Consideration must be given to developing an organisational climate in which people work willingly and effectively. People and organisations need each other. Attention should be focused, therefore, on improving the people–organisation relationship. Management is an integral part of this relationship. It should serve to reconcile the needs of people at work with the requirements of the organisation. Management is essentially an integrating activity which permeates every facet of the operations of the organisation. The style of management adopted can be seen as a function of the manager’s attitudes towards people, and assumptions about human nature and behaviour (discussed in Chapter 7). The general movement towards flatter organisation structures, flexible working and greater employee involvement has placed increasing emphasis on an integrating rather than a hierarchical/controlling style of management. Management processes in the new millennium will be much more behavioural in nature, focusing on the key human resource-driven issues: learning, team-based visions, driving human resource processes, incentives to enhance growth, holistic budgeting, and proactive controls.27

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THE PSYCHOLOGICAL CONTRACT One significant aspect of organisational behaviour and the relationship between the individual and the organisation is the concept of the psychological contract. This is not a written document, but implies a series of mutual expectations and satisfaction of needs arising from the people–organisation relationship. It involves a process of giving and receiving by the individual and by the organisation. The psychological contract covers a range of expectations of rights and privileges, duties and obligations, which do not form part of a formal agreement but still have an important influence on people’s behaviour.28 The nature and extent of individuals’ expectations vary widely as do the ability and willingness of the organisation to meet them. It is difficult to list the range of implicit expectations that individuals have and they change over time. These expectations are notwithstanding any statutory requirements placed upon the organisation; instead they relate more to the idea of a social responsibility of management, discussed in Chapter 5. The organisation will also have implicit expectations of its members. The organisational side of the psychological contract places emphasis on expectations, requirements and constraints that may differ from, and may conflict with, an individual’s expectations. Some possible examples of the individual’s and the organisation’s expectations are given in Figure 2.5.

Process of balancing

It is unlikely that all expectations of the individual or of the organisation will be met fully. There is a continual process of balancing, and explicit and implicit bargaining. The nature of these expectations is not defined formally, and although the individual member and the organisation may not be aware consciously of them, they still affect relationships between them and have an influence on behaviour. The psychological contract is a useful concept in examining the socialisation of new members of staff to the organisation. According to Kotter, for example, early experiences have a major effect on an individual’s subsequent career in an organisation, and influence job satisfaction, attitude and level of productivity. The extent of the matches between individual and organisational expectations also influences the willingness of people to stay with the organisation and of the organisation to continue to employ them.29 Stalker suggests that successful companies are those that have the ability to balance the unwritten needs of their employees with the needs of the company. Such companies use a simple formula of Caring, Communicating, Listening, Knowing and Rewarding. ■ ■ ■ ■ ■

Caring – demonstrating genuine concern for individuals working in the organisation. Communicating – really talking about what the company is hoping to achieve. Listening – hearing not only the words but also what lies behind the words. Knowing – the individuals who work for you, their families, personal wishes, desires and ambitions. Rewarding – money is not always necessary; a genuine thankyou or public recognition can raise morale.30

The significance of the psychological contract depends on the extent to which it is perceived as fair by both the individual and the organisation, and will be respected by both sides. Cartwright, for example, refers to mutuality as the basic principle of the psychological contract. A psychological contract is not only measured in monetary value or in the exchange of goods or services, it is in essence the exchange or sharing of beliefs and values, expectations and satisfactions. Mutuality is the basic principle of the psychological contract and consensus or mutual understanding is the basis of mutuality. Ideally therefore self-interest should be balanced with common interest in a ‘win–win’ arrangement.31

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INDIVIDUALS’ EXPECTATIONS OF THE ORGANISATION • provide safe and hygienic working conditions; • make every reasonable effort to provide job security; • attempt to provide challenging and satisfying jobs, and reduce alienating aspects of work; • adopt equitable human resource management policies and procedures; • respect the role of trade union officials and staff representives; • consult fully with staff and allow genuine participation in decisions which affect them; • implement best practice in equal opportunity policies and procedures; • reward all staff fairly according to their contribution and performance; • provide reasonable opportunities for personal development and career progression; • treat members of staff with respect; • demonstrate an understanding and considerate attitude towards personal problems of staff.

ORGANISATIONAL EXPECTATIONS OF THE INDIVIDUAL • uphold the ideology of the organisation and the corporate image; • work diligently in pursuit of organisational objectives; • adhere to the rules, policies and procedures of the organisation; • respect the reasonable authority of senior members of staff; • not take advantage of goodwill shown by management; • be responsive to leadership influence; • demonstrate loyalty and not betray positions of trust; • maintain harmonious relationships with work colleagues; • not abuse organisational facilities such as email or Internet access; • observe reasonable and acceptable standards of dress and appearance; • show respect and consolidation to customers and suppliers.

Figure 2.5 The psychological contract: possible examples of individual and organisational expectations

The nature of the boss–subordinate relationship is clearly a central feature of the psychological contract. Emmott, for example, points out that good people-management practices are the basis for a positive psychological contract and this means managers having to deal with the ‘soft stuff’. Properly managed the psychological contract delivers hard, bottom-line results and improved business performance. Managers at all levels can have an influence on employees’ perceptions of the psychological contract. It is, however, the relationship between individual employees and their line manager that is likely to have most influence in framing and managing employees’ expectations.32

CHAPTER 2 THE NATURE OF ORGANISATIONAL BEHAVIOUR

CHANGING NATURE OF THE PSYCHOLOGICAL CONTRACT The changing nature of organisations has placed an increasing emphasis on the importance of effective human resource management, including the importance of the psychological contract within the employment relationship. For example, from a review of research, McBain maintains that human resource management plays a key role in ensuring the promotion of business success and managing change. This involves paying attention to the psychological contract and the establishment of expectations and obligations with all groups of employees within the organisation.33 The Institute of Administrative Management has introduced a new module on ‘The Individual and the Organisation in Context’ which has come about because of the need to keep abreast of changes affecting the individual at work. There is a need for managers to be aware of the new psychological contracts the individual members of their teams are bringing to work. Managers will have to consider alternative management styles to meet this new need and to use new skills to motivate and train their staff. People no longer come to work to be ‘told what to do’, but are aspiring to be part of the whole, with a real role as stakeholders in the success of ‘their’ organisation. Wise managers will harness this commitment for the benefit of everyone concerned.34

Hiltrop suggests that the increasing pressure for organisations to change has prompted growing disillusionment with the traditional psychological contract based on lifetime employment and steady promotion from within. Companies must develop new ways to increase the loyalty and commitment of employees. This includes attention to reward strategies based on recognition of contribution rather than status or position; systematic training and development including the skills for working in cross-functional teams; and the training of managers in counselling, coaching and leadership skills.35

Performance management

Stiles et al. also draw attention to how new competitive conditions and dynamic environments have brought performance management to centre stage as a major element in the changing nature of the psychological contract. From an examination of three large UK organisations, the authors explore ‘how performance management processes are being used to support moves from the traditional contract of job security and clear career paths, while attempting to maintain commitment and morale’. The authors conclude that there are two main areas of difficulty in changing the psychological contract so that it focuses on performance management. The presence of mixed messages from employers is undermining the employment relationship and changes are being driven in a topdown manner with a lack of consultation. There is also disenchantment and concern about the accuracy and fairness of performance management processes, with employees expressing scepticism towards managerial attempts to implement change.36

A new moral contract The changing nature of organisations and individuals at work has placed increasing pressures on the awareness and importance of new psychological contracts. Ghosal et al. suggest that in a changing social context the law of masters and servants that underlies the old psychological contract is no longer acceptable to many people. Forces of global competition and turbulent change make employment guarantees unfeasible and also enhance the need for levels of trust and teamwork. The new management philosophy needs to be grounded in a very different moral contract with people. Rather than seeing people as a corporate asset from which value can be appropriated, people are seen as a responsibility and a resource to be added to. The new moral contract also demands much from employees who need to abandon the stability of lifetime employment and embrace the concept of continuous learning and personal development.37

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ORGANISATIONAL PRACTICES It is convenient, here, to consider two sets of observations on the nature of human behaviour and what may actually happen, in practice, in organisations: the Peter Principle, and Parkinson’s Law. Although these observations are presented in a satirical manner, they nevertheless make a serious and significant point about the management and functioning of organisations, and the actual nature and practice of organisational behaviour.

THE PETER PRINCIPLE This is concerned with the study of occupational incompetence and the study of hierarchies. The analysis of hundreds of cases of occupational incompetence led to the formulation of the ‘Peter Principle’, which is: In a hierarchy every employee tends to rise to their level of incompetence.38

Employees competent in their position are promoted and competence in each new position qualifies for promotion to the next highest position until a position of incompetence is reached. The principle is based on perceived incompetence at all levels of every hierarchy – political, legal, educational and industrial – and ways in which employees move upwards through a hierarchy, and what happens to them after promotion. Among the many examples quoted by Peter are those from the teaching occupation. A is a competent and conforming college student who becomes a teacher following the textbook, curriculum guide and timetable schedule, and who works well except when there is no rule or precedent available. A never breaks a rule or disobeys an order but will not gain promotion because, although competent as a student, A has reached a level of incompetence as a classroom teacher. B, a competent student and inspiring teacher, although not good with paperwork, is promoted to head of the science department because of success as a teacher. The head of science is responsible for ordering all science supplies and keeping extensive records and B’s incompetence becomes evident. C, a competent student, teacher and head of department, is promoted to assistant principal, and being intellectually competent is further promoted to principal. C is now required to work directly with higher officials. By working so hard at running the school, however, C misses important meetings with superiors and has no energy to become involved with community organisations. C thus becomes regarded as an incompetent principal.

Means of promotion

Peter suggests two main means by which a person can affect promotion rate, ‘Pull’ and ‘Push’. ■ ■

Pull is an employee’s relationship – by blood, marriage or acquaintance – with a person above the employee in the hierarchy. Push is sometimes manifested by an abnormal interest in study, vocational training and self-improvement.

In small hierarchies, Push may have a marginal effect in accelerating promotion; in larger hierarchies the effect is minimal. Pull is, therefore, likely to be more effective than Push. Never stand when you can sit; never walk when you can ride; never Push when you can Pull.39

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PARKINSON’S LAW A major feature of Parkinson’s Law is that of the ‘Rising Pyramid’, that is, ‘Work expands so as to fill the time available for its completion.’40 General recognition of this is illustrated in the proverb, ‘It is the busiest person who has time to spare.’ There is little, if any, relationship between the quantity of work to be done and the number of the staff doing it. Underlying this general tendency are two almost axiomatic statements: ■ ■

An official wants to multiply subordinates, not rivals. Officials make work for each other.

Parkinson goes on to give the following example. If a civil servant, A, believes he is overworked there are three possible remedies: (i) resignation; (ii) ask to halve the work by having it shared with a colleague, B; or (iii) seek the assistance of two subordinates, C and D. The first two options are unlikely. Resignation would involve loss of pension rights, and sharing work with a colleague on the same level would only bring in a rival for promotion. So A would prefer the appointment of two junior members of staff, C and D. This would increase A’s status. There must be at least two subordinates, so that by dividing work between C and D, A will be the only person to understand the work of them both. Furthermore, each subordinate is kept in order by fear of the other’s promotion. When, in turn, C complains of overwork, A, with the agreement of C, will advise the appointment of two assistants, E and F. However, as D’s position is much the same and to avoid internal friction, two assistants, G and H, will also be recommended to help D. There are now seven people, A, C, D, E, F, G, H, doing what one person did before, and the promotion of A is almost certain.

People making work for each other

With the seven people now employed, the second stage comes into operation. The seven people make so much work for each other that they are all fully occupied and A is actually working harder than ever. For example, an incoming document comes before each of them in turn. E decides it is F’s concern; F places a draft reply for C, who makes drastic amendments before consulting with D, who asks G to action it. But then G goes on leave and hands the file to H, who drafts a minute signed by D and returned to C, who revises the first draft and puts the new version before A. What does A do? A could find many excuses for signing C’s draft unread. However, being a conscientious person, and although beset with problems created by subordinates both for A and for themselves, A reads through the draft carefully, deletes the fussy paragraphs added by C and H, and restores it to the format presented in the first instance by F. Among other features of organisational practice that Parkinson discusses are: principles of personnel selection; the nature of committees; personality screen; high finance – and the ‘Law of Triviality’, which means in a committee that the time spent on any agenda item will be in inverse proportion to the sum involved; layout of the organisation’s administration block; and ‘injelitis’ – the disease of induced inferiority.

Relevance of observations

Despite the light vein of Parkinson’s writing, the relevance of his observations can be gauged from comments in the Introduction by HRH The Duke of Edinburgh. The most important point about this book for serious students of management and administration is that it illustrates the gulf that exists between the rational/intellectual approach to human organization and the frequent irrational facts of human nature … The law should be compulsory reading at all business schools and for all management consultants. Management structures solve nothing if they do not take the facts of human nature into proper consideration, and one of the most important facts is that no one really likes having to make decisions. Consequently structures may generate a lot of activity but little or no useful work.41

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I first read Parkinson’s Law when studying for Economics A-level. Many of the laws are just as relevant today as they were then. They include: how to ‘manage’ a meeting, and how time spent in meetings is inversely proportional to the importance of each issue – his example is a short discussion on a £10 million power plant followed by a lengthy debate over a £350 bicycle shed. Ever been there? … Parkinson’s most famous law is that ‘work expands to fill the time available – as we all make work for one another’. This is still true today. Iain Herbertson, Managing Director of Manpower42

THE NEED FOR A CROSS-CULTURAL APPROACH The international context of management and organisational behaviour One major challenge facing managers in the early 21st century arises from what many commentators have identified as an increasingly international or global business environment. The following factors are frequently cited as potential explanatory factors underlying this trend: ■ ■

■ ■

Improvements in international communication facilities leading to an increased consciousness of differences in workplace attitudes and behaviour in other societies. International competitive pressure – for example, the emergence of newly industrialised and/or free-market nations (the Far East region and ex-communist bloc countries are often viewed as examples of this phenomenon). The spread of production methods and other business processes across nations and regions. International business activity, for example: overseas franchising or licensing agreements; outsourcing of business units to other countries (call centres provide a topical example); direct foreign investment and the activities of multinational corporations which, by definition, operate outside national boundaries.

Photo: European Parliament

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The European Parliament building in Strasbourg, France

It is not only businesses which choose to operate in more than one country or import foreign business and management techniques that are affected by cross-cultural concerns. Tayeb reported United States Department of Labor statistics indicating that in the period from 1985 to 2000, only 15 per cent of new entrants to the workforce in the USA were white males.43 This highlights the importance of managing diversity in workforces within national boundaries.

Lessons from abroad? One rationale for taking a cross-cultural approach to management lies in the potential benefits to be gained in performance terms. Schneider and Barsoux, in advocating cultural awareness of one’s own society, note that: each country has its unique institutional and cultural characteristics, which can provide sources of competitive advantage at one point, only to become liabilities when the environment changes. Managers therefore need to evaluate the extent to which national culture can interfere with their company’s efforts to respond to strategic requirements, now and in the future’.44

CHAPTER 2 THE NATURE OF ORGANISATIONAL BEHAVIOUR

In addition to practically based benefits in considering our own ‘home’ culture, there has been a long tradition of looking to other cultures for examples of ‘successful’ practice which could be transplanted into work organisations in different societies. Different models may be dominant at different times. Thompson and McHugh note that: ‘In the post-war period the giant US corporations transferred work organisation and managerial techniques across capitalist countries.’45 However, in subsequent eras Scandinavian autonomous work group arrangements and Japanese management techniques were examined by and, to some extent, implemented in, organisations across the world. Such a search for good practice in other countries is, of course, ongoing and an awareness of how other cultures organise work and manage people is likely to be of continuing benefit in the future.

Managing people from different cultures Another advantage of adopting a cross-cultural approach to the study of organisational behaviour, and to the management of people more generally, lies in the recognition of variations in workplace attitudes and behaviour between individuals and groups in different cultural contexts. Brooks notes that: ‘Differences in national culture may have a bearing on how organisations deal with each other and also on behaviour within organisations which comprise a mix of nationalities.’46 If we accept this fundamental point then it follows that key topics within the subject area of organisational behaviour may be influenced by national culture and that we should therefore re-evaluate models and concepts when applying them to other societies. One leading writer in the field of cross-cultural studies, Trompenaars, commenting on his own work, suggests that: ‘it helped managers to structure their experiences and provided new insights for them and their organisations into the real source of problems faced when managing across cultures or dealing with diversity’.47 In examining the centrally important topic of motivation, Francesco and Gold inform their readers that: ‘managers must develop organizational systems that are flexible enough to take into account the meaning of work and the relative value of rewards within the range of cultures where they operate.’48 A practical example of the impact of cultural diversity in the organisational behaviour area is provided in the recollections of an International Human Resource Manager cited in Schneider and Barsoux: ‘Indonesians manage their culture by a group process, and everyone is linked together as a team. Distributing money differently among the team did not go over all that well; so we’ve come to the conclusion that pay for performance is not suitable for Indonesia.’49 It may be extremely useful therefore to examine academic frameworks and research findings within the field of organisational behaviour to indicate the extent to which they are applicable worldwide or, alternatively, subject to meaningful variation in different cultural contexts.

IS ORGANISATIONAL BEHAVIOUR CULTURE-BOUND? While it can be valuable to apply organisational behaviour concepts to diverse cultural settings it should also be borne in mind that some universal theories and models may, in reality, contain important culturally-derived assumptions. When examining classical frameworks for understanding organisation structure Schneider and Barsoux point out that: ‘theories about how best to organise – Max Weber’s (German) bureaucracy, Henri Fayol’s (French) administrative model, and Frederick Taylor’s (American) scientific management – all reflect societal concerns of the times as well as the cultural background of the individuals.’50 That writers on work organisations may themselves be influenced by their own cultural backgrounds when compiling their work is unsurprising: however, it should equally not be ignored.

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More significant still is the possibility that whole topics within organisational behaviour, per se, may be underpinned by a particular culturally-derived frame of reference. Francesco and Gold, addressing the issue of leadership, claim that: ‘one difficulty is that not all cultures have the term leader’.51 This raises the possibility that meanings we may assume to be taken for granted could be interpreted differently or not even perceived at all in different parts of the world.

Culture as understanding ‘For our most basic common link is that we all inhabit this small planet, we all breathe the same air, we all cherish our children’s future, and we are all mortal’ (John. F. Kennedy, 10 June 1963). There are a number of very good reasons why we could usefully understand cultural difference (and similarity) at work, based on new awareness contributing to our own effectiveness and moreover to the accomplishment of organisational goals. It could also be true to say that an appreciation of culture and its effects may be of intrinsic value. There could therefore be advantages of cross-cultural awareness which include: ■ ■ ■ ■

increased self-awareness; sensitivity to difference; questioning our own assumptions and knowledge; lessening ignorance, prejudice and hatred.

However, it would be wrong to think that increased cross-cultural awareness or activity will automatically bring about any of these outcomes. Adler listed the following inbuilt dangers when multi-cultural teams operate in a business setting. ■ ■ ■

Mistrust – including stereotyping. Miscommunication with potential for reduced accuracy and resultant stress. Process difficulties, that is failure to agree when agreement is needed or even what constitutes agreement when arriving at decisions.

Adler goes on to examine research on the success of multi-cultural work teams and concludes that the evidence suggests that they either perform much better or much worse than teams composed of one cultural group.52 There are clearly risks as well as benefits in working across cultures. It is hoped that an appreciation of cross-cultural aspects of organisational behaviour can help in this regard.

MODELS FOR UNDERSTANDING THE IMPACT OF CULTURE The study of culture

Culture is a notoriously difficult concept to pin down. It is all too easy to assume that differences observed between societies may be attributed to culture per se, with little explanation of the reasons which may lie behind the differences, real or perceived. Robbins notes that: ‘Most people are unaware of just how their culture will affect them. Culture is like fish to water. It is there all the time but the fish are oblivious to it.’ 53 It is therefore necessary to be aware of one’s own culture in order to appreciate fully differences between different groups. The Johari Window technique – see Chapter 14 – can be useful in identifying what may be known and not known regarding different cultures. Attempt to use this framework in respect of your own and one other culture to see its potential value. We should not assume that we are aware of all facets of our own culture or that others see us in a realistic and accurate way.

Matched pair comparisons

Some writers who have sought to conduct comparative research into workplace differences have frequently used a matched pair method of comparison. This involves selecting organisations for study which are similar in size, product or service, technologies employed and ownership pattern. It is claimed that any differences observed can

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be isolated and subjected to further detailed analysis to ascertain whether they are culturally-derived. An example of this methodological tradition is the work of Maurice, Sorge and Warner which is considered in Chapter 16.54

The danger of stereotyping

In Chapter 11 of this book we identify the concept of ‘selective perception’, that is the possibility of drawing inferences and conclusions from partial information. One example of this phenomenon is stereotyping which involves making judgements on an individual as a result of their membership of a group, which, we assume, itself contains shared characteristics. We clearly need to avoid stereotyping when approaching the subject of cultural differences at work. Writers such as Hofstede and Trompenaars, while identifying clusters of countries which they suggest may share particular features, nonetheless allow for divergence from the norm by referring to central tendencies. To take one example, Hong Kong is characterised by Hofstede as a low uncertainty avoidance culture which suggests a propensity for risk-taking and a tolerance of rapid change. However, it is eminently possible to conceive of an individual from Hong Kong who is ‘risk averse’ and conservative due to their own personality and upbringing.55 It is, finally, necessary to take a non-judgemental approach when identifying cultural differences and academics in this area and crucially successful international managers tend to adopt an approach of ‘not better nor worse – just different’!

Defining and conceptualising culture Culture is a multifaceted concept. Models purporting to explain this topic typically distinguish between different layers or strata of culture. Trompenaars identifies three layers of culture; namely an outer, middle and core. Figure 2.6 depicts these layers as concentric circles. The outer circle identifies artifacts and products, the middle circle encompasses norms and values and the inner circle comprises basic assumptions held within the group.56 It may equally be useful to conceive of a three-layer model of culture comprising outer, middle and core layers. For our purposes an outer layer of culture refers to surface-level elements of culture which are quickly and easily understood on even a short visit to another country. Examples could include language, climate, dress and food and drink. The 1994 film Pulp Fiction provides an example in which a character in the film has recently returned to the USA after spending three years in Amsterdam. His description of the Netherlands is restricted to surface level anecdotes regarding fast

Figure 2.6 A model of culture Source: Reproduced with permission from F. Trompenaars and C. Hampden-Turner, Riding the Waves of Culture, Second edition, Nicholas Brealey (1999), p. 22.

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food and the comparative legality and availability of soft drugs. The viewer is invited to mock his failure to understand the greater subtleties of Dutch culture. Aspects of this outer layer can nonetheless be important to a successful cultural exchange in business. Giving a work colleague in the Czech Republic red flowers as a gift may be taken as expression of romantic interest while wearing a green hat in China may signify that one’s partner is unfaithful! A middle layer of culture is the one which will be of most relevance for us as it concerns expressed values, attitudes and behaviours. In terms of organisational behaviour, if we accept the evidence that indicates significant differences between cultures, we might anticipate that findings in the following topics should be re-examined to see whether they apply in different societies: Leadership, Perception, Motivation, Work Groups, Organisation Structure, Human Resource Management and Management Control and Power. The contribution of writers such as Hofstede, Trompenaars, and Hall and Hall57 may also provide useful frameworks for understanding topics within organisational behaviour from a cross-cultural standpoint. A core layer of culture relates to the deepest assumptions concerning people and nature held by a particular society. Such assumptions, which may be vestigial, often relate to the topography of a society or the level of threat posed by natural disasters. For example, it has been claimed that the Netherlands as a small country bounded by larger neighbours has developed a pragmatic flexible approach to business as a result of its location, bolstered by its historic struggle to keep the sea at bay. In the UK the relatively high degree of scepticism towards greater European integration may, in part, be explained by its island status. So-called group mentalities exhibited by some Asian countries could be traced back to patterns of agrarian production exhibited in previous times. Somewhat more arcane and, by definition, difficult to unravel, these core layer assumptions could conceivably manifest themselves in modern day cross-border business dealings. In Figure 2.7 Tayeb shows with examples how culture can take effect at a number of levels; from the global through to the personal. Readers may wish to consider how significant cultural differences may occur at the regional and/or community levels in their own experience. Nonetheless studies of culture most usually take the country or nation state as the focus of attention.58

Example: wishing to suceed in life

Global layer

Behaviours

Example: avoiding loss of face in Japanese culture

National layer

Attitudes

Example: Bengali culture in West Bengal, India

Regional layer

Beliefs

Example: helping neighbours in a mining community in Wales, UK

Community layer

Values

Example: caring for wildlife

Personal layer

Taken for granted assumptions

Figure 2.7 Major cultural layers Source: Reproduced with permission from M. Tayeb, International Management: Theories and Practice, Financial Times Prentice Hall (2003), p. 14, with permission from Pearson Education Ltd.

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Figure 2.8 Factors affecting national culture Source: Reproduced with permission from Ian Brooks, Organisational Behaviour: Individuals, Groups and Organisation, Second edition, Financial Times Prentice Hall (2003), p. 266, with permission from Pearson Education Ltd.

Brooks is one of several commentators who draw our attention to the interlinked nature of culture. Figure 2.8 illustrates the interplay between relevant factors affecting any one national culture.59 You may wish to consider how these factors have combined to shape your own ‘home’ culture and that of one other country with which you are familiar.

FIVE DIMENSIONS OF CULTURE: THE CONTRIBUTION OF HOFSTEDE Geert Hofstede is one of the most significant contributors to the body of knowledge on culture and workplace difference. His work has largely resulted from a large-scale research programme involving employees from the IBM corporation, initially in 40 countries. In focusing on one organisation Hofstede felt that the results could be more clearly linked to national cultural difference. Arguing that culture is, in a memorable phrase, collective programming or software of the mind, Hofstede initially identified four dimensions of culture; power distance, uncertainty avoidance, individualism and masculinity.60 (See Table 2.1.) ■

■

■

■

Power distance is essentially used to categorise levels of inequality in organisations, which Hofstede claims will depend upon management style, willingness of subordinates to disagree with superiors, and the educational level and status accruing to particular roles. Countries which displayed a high level of power distance included France, Spain, Hong Kong and Iran. Countries as diverse as Germany, Italy, Australia and the USA were characterised as low power distance societies. Britain also emerged as a low power distance society according to Hofstede’s work. Uncertainty avoidance refers to the extent to which members of a society feel threatened by unusual situations. High uncertainty avoidance is said to be characteristic in France, Spain, Germany and many of the Latin American societies. Low-to-medium uncertainty avoidance was displayed in the Netherlands, the Scandinavian countries and Ireland. In this case Britain is said to be ‘low-tomedium’ together with the USA, Canada and Australia. Individualism describes the relatively individualistic or collectivist ethic evident in that particular society. Thus, the USA, France and Spain display high individualism. This contrasts with Portugal, Hong Kong, India and Greece which are low individualism societies. Britain here is depicted as a high individualism society. Masculinity is the final category suggested by Hofstede. This refers to a continuum between ‘masculine’ characteristics, such as assertiveness and competi-

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Table 2.1 Classification of cultures by dimensions I: More developed Latin

II: Less developed Latin

high power distance high uncertainty avoidance high individualism medium masculinity

high power distance high uncertainty avoidance low individualism whole range on masculinity

Belgium France Argentina Brazil Spain

Colombia Mexico Venezuela Chile Peru Portugal Yugoslavia

lll: More developed Asian

lV: Less developed Asian

V: Near Eastern

medium power distance high uncertainty avoidance medium individualism high masculinity

high power distance low uncertainty avoidance low individualism medium masculinity

high power distance high uncertainty avoidance low individualism medium masculinity

Japan

Pakistan Taiwan Thailand Hong Kong India Philippines Singapore

Greece Iran Turkey

Vl: Germanic

Vll: Anglo

Vlll: Nordic

low power distance high uncertainty avoidance medium individualism high masculinity

low power distance low-to-medium uncertainty avoidance high individualism low masculinity

low power distance low-to-medium uncertainty avoidance medium individualism low masculinity

Austria Israel Germany Switzerland South Africa Italy

Australia Canada Britain Ireland New Zealand USA

Denmark Finland The Netherlands Norway Sweden

(Reproduced with permission from ‘International Perspectives’, Unit 16, Block V, Wider Perspectives, Managing in Organizations, ©The Open University (1985) p. 60.)

tiveness, and ‘feminine’ traits, such as caring, a stress upon the quality of life and concern with the environment. High masculinity societies included the USA, Italy, Germany and Japan. More feminine (low masculinity) societies included the Netherlands and the Scandinavian countries. In this case Britain was located within the high masculinity group. A fifth dimension of culture, long-term/short-term orientation, was originally labelled Confucian work dynamism. This dimension developed from the work of Bond in an attempt to locate Chinese cultural values as they impacted on the workplace.61

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Countries which scored highly on Confucian work dynamism or long-term orientation exhibited a strong concern with time along a continuum and were therefore both pastand future-oriented, with a preoccupation with tradition but also a concern with the effect of actions and policies on future generations. Table 2.2 indicates the score of ten countries along this fifth dimension. Unsurprisingly China scores highest on the LT column followed by Japan. Note the significantly lower scores of the USA and Western European countries surveyed.

Table 2.2 Cultural dimension scores for ten countries

USA Germany Japan France Netherlands Hong Kong Indonesia West Africa Russia China

PD

ID

MA

UA

LT

40L 35L 54M 68H 38L 68H 78H 77H 95*H 80*H

91H 67H 46M 71H 80H 25L 14L 20L 50*M 20*L

62H 66H 95H 43M 14L 57H 46M 46M 40*L 50*M

46L 65M 92H 86H 53M 29L 48L 54M 90*H 60*M

29L 31M 80H 30*L 44M 96H 25*L 16L 10*L 118H

PD=Power Distance; ID=Individualism; MA=Masculinity; UA=Uncertainty Avoidance; LT=Long-Term Orientation. H=top third, M=medium third, L=bottom third (among 53 countries and regions for the first four dimensions; among 23 countries for the fifth), *estimated Reprinted with permission from Hofstede, G., ‘Cultural Constraints in Management Theories’, Academy of Management Executive: The Thinking Manager’s Source, 7, 1993, p. 91.

Evaluation of Hofstede’s work Extremely influential; the seminal work of Hofstede has been criticised from certain quarters. In common with other writers in this area there is a focus on the national rather than regional level. The variations within certain countries, for example Spain, can be more or less significant. Again in common with other contributors Hofstede’s classifications include medium categories which may be difficult to operationalise, accurate though they may be. Some may also find the masculinity/femininity dimension unconvincing and itself stereotypical. Other writers have questioned whether Hofstede’s findings remain current. Holden summarises this view: ‘How many people have ever thought that many of Hofstede’s informants of three decades ago are now dead? Do their children and grandchildren really have the same values?’62 Ultimately, readers can assess the value of his work in the light of their own experiences and interpretations of the business world. Hofstede in his extensive research has attempted to locate the essence of work-related differences across the world and to relate these to preferred management styles.

CULTURAL DIVERSITY: THE CONTRIBUTION OF TROMPENAARS Another significant contributor to this area of study is provided by Fons Trompenaars whose later work is co-authored with Charles Hampden-Turner.63 Trompenaars’s original research spanned 15 years, resulting in a database of 50,000 participants from 50 countries. It was supported by cases and anecdotes from 900 cross-cultural training programmes. A questionnaire method comprised a significant part of the study which involved requiring participants to consider their underlying norms, values and

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attitudes.The resultant framework identifies seven areas in which cultural differences may affect aspects of organisational behaviour. ■

■

■

■

■

■

■

Relationships and rules. Here societies may be more or less universal, in which case there is relative rigidity in respect of rule-based behaviour, or particular, in which case the importance of relationships may lead to flexibility in the interpretation of situations. Societies may be more oriented to the individual or collective. The collective may take different forms: the corporation in Japan, the family in Italy or the Catholic Church in the Republic of Ireland. There may be implications here for such matters as individual responsibility or payment systems. It may also be true that societies differ to the extent it is thought appropriate for members to show emotion in public. Neutral societies favour the ‘stiff upper lip’ while overt displays of feeling are more likely in emotional societies. Trompenaars cites a survey in which 80 employees in each of various societies were asked whether they would think it wrong to express upset openly at work. The numbers who thought it wrong were 80 in Japan, 75 in Germany, 71 in the UK, 55 in Hong Kong, 40 in the USA and 29 in Italy. In diffuse cultures, the whole person would be involved in a business relationship and it would take time to build such relationships. In a specific culture, such as the USA, the basic relationship would be limited to the contractual. This distinction clearly has implications for those seeking to develop new international links. Achievement-based societies value recent success or an overall record of accomplishment. In contrast, in societies relying more on ascription, status could be bestowed on you through such factors as age, gender or educational record. Trompenaars suggests that societies view time in different ways which may in turn influence business activities. The American dream is the French nightmare. Americans generally start from zero and what matters is their present performance and their plan to ‘make it’ in the future. This is ‘nouveau riche’ for the French, who prefer the ‘ancien pauvre’; they have an enormous sense of the past. Finally it is suggested that there are differences with regard to attitudes to the environment. In western societies, individuals are typically masters of their fate. In other parts of the world, however, the world is more powerful than individuals.

Trompenaars’ work is based on lengthy academic and field research. It is potentially useful in linking the dimensions of culture to aspects of organisational behaviour which are of direct relevance, particularly to people approaching a new culture for the first time.

The high- and low-context cultures framework This framework for understanding cultural difference has been formulated by Ed Hall; his work is in part co-authored with Mildred Reed Hall.64 Hall conceptualises culture as comprising a series of ‘languages’, in particular: ■ ■ ■ ■ ■

Language of time Language of space Language of things Language of friendships Language of agreements

In this model of culture Hall suggests that these ‘languages’, which resemble shared attitudes to the issues in question, are communicated in very different ways according to whether a society is classified as ‘high’ or ‘low’ context. The features of ‘high’ context societies, which incorporate Asian, African and Latin American countries, includes:

CHAPTER 2 THE NATURE OF ORGANISATIONAL BEHAVIOUR ■ ■ ■ ■ ■

a high proportion of information is ‘uncoded’ and internalised by the individual; indirect communication styles … words are less important; shared group understandings; importance attached to the past and tradition; ‘diffuse’ culture stressing importance of trust and personal relationships in business.

‘Low’ context societies, which include the USA, Australia, Britain and the Scandinavian countries, exhibit contrasting features including: ■ ■ ■ ■

a high proportion of communication is ‘coded’ and expressed; direct communication styles … words are paramount; past context less important; ‘specific’ culture stressing importance of rules and contracts.

Other countries, for example France, Spain, Greece and several Middle Eastern societies, are classified as ‘medium’ context. To take one example as an illustration: American managers visiting China may find that a business transaction in that country will take more time than at home. They may find that it is difficult to interpret the true feelings of their Chinese host and may need to decode non-verbal communication and other signals. They may seek to negotiate a rules-based contract whereas their Chinese counterpart may lay greater stress upon building a mutually beneficial reciprocal relationship. There is scope for potential miscommunication between the two cultures and interesting differences in interpersonal perception. Inasmuch as much of the management literature canon originates from the Anglo-American context, there is again considerable merit in adopting a cross-cultural perspective.

SUMMARY: CONVERGENCE OR CULTURE-SPECIFIC ORGANISATIONAL BEHAVIOUR There is evidence of a narrowing or even increasing elimination of cultural differences in business. Grint sees both positive and negative consequences of aspects of globalisation. While noting that: ‘at last we are approaching an era when what is common between people transcends that which is different; where we can choose our identity rather than have it thrust upon us by accident of birth’,65 the same author goes on to suggest that: ‘we are heading for global convergence where national, ethnic and local cultures and identities are swamped by the McDonaldization ... and/or Microsoftization of the world’.66 There is an undoubted narrowing of cultural differences in work organisations; and it may be the case that such narrowing may apply to individual and group behaviour at work. Thompson and McHugh note for example that: ‘Russia is now experiencing rampant individualism and uncertainty following the collapse of the old solidaristic norms’, thus implying convergence of work values.67 For the most part, however, it is argued here that growing similarity and harmonisation relate more often to production, IT and quality systems which are more likely to converge due to best-practice comparisons and universal computer standards. Human Resource Management is, contrastingly, less likely to converge due to national institutional frameworks and culturally derived preferences. Recent significantly different responses to the need for greater workplace ‘flexibility’ in Britain and France illustrate this point. Above all, those aspects of organisational behaviour which focus on individual differences, groups and managing people are the most clearly affected by culture and it is argued strongly here that it is and is likely to remain essential to take a crosscultural approach to the subject.

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CRITICAL REFLECTIONS In your understanding of behaviour and managing people at work – as in life more generally – it is worth remembering the ‘Bag of Gold’ syndrome. However hard you try or whatever you do there will always be some people you just cannot seem to please. Give them a bag of gold and they will complain that the bag is the wrong colour, or it is too heavy to carry, or why could you not give them a cheque instead! What are your own views?

What happens within organizations affects what happens outside and vice versa. Organizational behaviour is seen chiefly as being about the particular ways that individual’s dispositions are expressed in an organizational setting and about the effects of this expression. While at work there is rest and play. What happens in rest and play, both inside and outside the organization, impacts on organizational life. We can also gain insight into organizational behaviour by looking at less organized work, like work ‘on the fiddle’, and what work means to the unemployed. Wilson, F. M. Organizational Behaviour: A Critical Introduction, Oxford University Press (1999), pp. 1–2.

How would you explain the meaning and nature of organisational behaviour, and how it is influenced?

’The study of organisational behaviour is really an art which pretends that it is a science and produces some spurious research findings to try to prove the point.’ Debate.

SYNOPSIS ■ Organisations play a major and continuing role in the lives of us all, especially with the growth of large-scale business organisations. The decisions and actions of management in organisations have an increasing impact on individuals, other organisations and the community. It is important, therefore, to understand how organisations function and the pervasive influences they exercise over the behaviour of people. It is also necessary to understand interrelationships with other variables which together comprise the total organisation. ■ The behaviour of people in work organisations can be viewed in terms of multirelated dimensions relating to the individual, the group, the organisation and the environment. The study of organisational behaviour cannot be understood fully in terms of a single discipline. It is necessary to provide a behavioural science approach drawing on selected aspects of the three main disciplines of psychology, sociology and anthropology together with related disciplines and influences. ■ Organisations are complex social systems which can be defined and studied in a number of different ways. One approach is to view organisations in terms of contrasting metaphors. Gauging the effectiveness or success of an organisation is not an easy task, however, although one central element is the importance of achieving productivity through the effective management of people. People differ in the manner and extent of their involvement with, and concern for, work. Different situations influence the individual’s orientation to work and work ethic. A major concern for people today is balancing work and personal commitments.

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■ It is through the process of management that efforts of members of the organisation are co-ordinated, directed and guided towards the achievement of organisational objectives. Management is the cornerstone of organisational effectiveness. It is essentially an integrating activity and concerned with arrangements for the carrying out of organisational processes and the execution of work. How managers exercise the responsibility for, and duties of, management is important. Attention should be focused on improving the people–organisation relationship. ■ One particular aspect of the relationship between the individual and the organisation is the concept of the psychological contract. This is not a formal, written document but implies a series of mutual expectations and satisfaction of needs arising from the people–organisation relationship. There is a continual process of explicit and implicit bargaining. The nature of expectations has an important influence on the employment relationship and behaviour in work organisations. The changing nature of organisations and individuals at work has placed increasing pressures on the awareness and importance of a different moral contract with people. ■ A major challenge facing managers today arises from an increasingly international or global business environment. This highlights the need for a cross-cultural approach to the study of organisational behaviour and the management of people. In an increasingly global context, managers need to recognise and understand the impact of national culture. However, culture is a multifaceted concept and notoriously difficult to pin down. But it has important repercussions for the effective management of people, and the study and understanding of workplace behaviour.

REVIEW AND DISCUSSION QUESTIONS 1 Explain your understanding of (i) the nature of organisational behaviour and (ii) the meaning of behavioural science. 2 Suggest main headings under which interrelated factors can be identified which influence behaviour in work organisations. For each of your headings give examples from your own organisation. 3 Discuss how organisations may be viewed in terms of contrasting metaphors. Explain how you would apply these metaphors to an understanding of your own organisation. 4 Discuss the role of management as an integrating activity. Give your own views on the responsibility of management and the manner in which you believe this responsibility should be exercised. 5 Explain the nature of the people–organisation relationship. Why is it important to distinguish between the ‘intent’ and the ‘implementation’ of management decisions and actions? 6 Explain what is meant by the ‘psychological contract’. List (i) the personal expectations you have of your own organisation and (ii) what you believe to be the expectations of the organisation. Discuss with supporting examples the changing nature of psychological contracts between the organisation and its members. 7 Why is it increasingly important for managers to adopt an international approach? Discuss critically the likely longer-term impact of Britain’s membership of the European Union. 8 Debate fully the importance of national culture to the study of management and organisational behaviour. Where possible, give your own actual examples

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ASSIGNMENT 1 A first step in understanding human behaviour and the successful management of other people is to know and understand yourself. For this simple exercise you are asked to select any one of the following shapes that you feel is ‘YOU’.

After you have made your selection discuss in small groups the reasons which prompted you to choose that particular shape. How much agreement is there among members of your group? You should then consider and discuss the further information provided by your tutor.

ASSIGNMENT 2 Provide for classroom discussion short descriptions (suitably disguised if necessary) to illustrate the practical application of: 1 The Peter Principle, and 2 Parkinson’s Law. Include in your descriptions what you believe to be the relevance of each of these sets of observations, and the effects on other members of staff.

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PERSONAL AWARENESS AND SKILLS EXERCISE OBJECTIVES Completing this exercise should help you to enhance the following skills:
Obtain a clearer picture of your own and other people’s work ethic.
Explore the importance of work to you and your fixed attitudes about work.
Recognise the significance of individuals’ orientations to work within an organisation.

EXERCISE You are required to start by asking yourself this question: is it a good thing to be a worker? And then to think carefully about your responses to the following questions: How do you feel ... ■ when you hear the word ‘work’? ■ as you get ready for work? ■ when you know the day is over? ■ about the work you’ve accomplished? ■ about someone who chooses not to work? ■ about taking time off? ■ when you hear the word ‘management’? ■ about taking control of your career?

Compare your responses with those of your colleagues. What conclusions do you draw about the work ethic?

DISCUSSION ■ What do you see as the character traits of a person with a healthy work ethic? ■ To what extent do you agree with the contention that: ‘we are employed for our skills but

valued for our attitude’? ■ What effect might different orientations to work have within an organisation and how might

they all be accommodated?

Visit our website www.booksites.net/mullins for further questions, annotated weblinks, case material and Internet research material.

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CASE STUDY 2.1

Eric and Kipsy: complexities of management and organisational behaviour CONSIDER THE PLIGHT OF ERIC Eric is a new manager of product information for a national firm which wholesales electrical components. He’s proud because he was assigned a ‘tough’ office right out of management training. He’s challenged because he can see as clearly as everyone else in the office that the work is not getting done on time – and that mistakes are far above the 2 per cent target. And he’s scared because he finds himself utterly incapable of figuring out what he ought to do to make things better.

Eric’s first day The office is a new, one-storey building in a wooded suburban location – complete with carpeting on the floor and Muzak in the walls. There are 35 female employees, ranging from recent high school graduates in their first job to experienced middle-aged housewives. Their job is to provide salesmen in the field with current information about price, availability and delivery times of an exceptionally large inventory of electrical equipment and supplies. Eric spent his first day on the job – some three months ago now – just watching and listening. While in management training, he had thought a lot about how he would handle that first day. He knew that everyone in the office would be as eager to find out what he was like as he was to learn about them and their jobs. And he wanted to make a good impression. But Eric finally decided not to give a false impression. The fact was that he knew virtually nothing about the people he would be managing, or the kind of work they did. So why, he asked himself, act otherwise? Besides, if the people saw that he was genuinely interested in listening to them and learning from them, perhaps that would help establish good mutual rapport between him and his people. So he would just watch, and listen, and try to learn in his first few days on the job. The first day was fun. Soon after arriving and being introduced to the four first-level supervisors, he asked to be ‘plugged in’ to one of the complicated-looking operating consoles at which the women received calls from the field. A green light would blink on the console, and the information clerk would be connected to the salesman in the field – all taken care of by an outof-sight computer, which assigned calls sequentially to

the waiting clerks. The salesman would ask for information about the availability of a certain piece of equipment. The clerk would then look up the stock number of that item in a large catalogue at her side and punch the number into a keyboard on the console. Immediately, the computer would present full information about stocks and delivery times of that item on an electronic display panel on the console, and the clerk would relay the appropriate information to the salesman. When the call ended, the green light would extinguish itself, and the clerk would then wait for the light to flash again, signalling the arrival of a new call. Eric was fascinated by both the efficiency of the operation and the pleasantness of the surroundings. His biggest worry at that point was that everything was so efficiently designed that he, as manager, would not have anything to do with his time.

Beware first impressions He soon learned how wrong he was. When, on his second day at the office, he began to attack a pile of paperwork on his desk, he found messages from nearly a dozen field salesmen, all wanting him to return their calls. Each of these salesmen, it turned out, had a significant complaint about the product information service – and some were obviously quite angry. Eric managed to maintain a calm, responsive stance in relation to the complaining salesmen, but he also felt his stomach tightening as he heard what they had to say. By the day’s end, he had made a list of three general problems which seemed both frequent enough and serious enough to warrant his immediate attention and action: 1 Salesmen often were unable to get through quickly to information clerks. Since salesmen’s calls usually were made from customer offices, this meant that they were left holding the telephone of a client for up to 10 or 15 minutes waiting for a clerk – while both the salesman and the customer became increasingly impatient. 2 Errors were excessive. Salesman after salesman reported that, on the basis of information provided by the clerks, they would promise delivery of materials on a specific date at a specific price – only to hear later from an irate customer that the materials had not been delivered, that the price was different from that quoted, or (all too often) both.

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3 The clerks were often abrupt and unfriendly to the salesmen when they called. According to more than one salesman, the clerks acted as if they were being imposed upon, rather than providing the salesmen with help in carrying out the company’s business.

room). This informal network was also popular for creative co-ordination of ‘personals’ (i.e., short breaks for visits to the toilet) and for making sure that none of the clerks was violating the generally accepted norms about how much work should be carried out on a given day.

The source of the problems

Eric’s challenge

In the following week, as Eric attempted to track down the reasons for these difficulties, other problems came to light. First, absenteeism and turnover were extremely high. It appeared that the excessive delays were partly due to the fact that 15 to 20 per cent of the clerks were unlikely to show up for work on any given day – especially Monday and Friday – and that up to an hour’s tardiness was not uncommon. This created call ‘backups’ on the computer. The computer, of course, calmly held the calls for as long as necessary, oblivious as only a machine can be to the rise in tempers in the customer’s office. When absenteeism was particularly high on any given day, part-time employees were called to fill in. Many of these individuals were not entirely familiar with the job and often did not remember some of the procedures to be used in looking up equipment numbers in the catalogue – resulting in wrong catalogue numbers and erroneous information being given to the customers. Worse, even experienced clerks had a high error rate. Eric’s hope that the error problem was in the computerised information displayed on the clerks’ consoles rather than a fault of the clerks themselves was clearly misplaced. Reports of errors arrived weeks after the information was provided (when orders failed to arrive on the customer’s premises, or arrived with unexpected prices), and so it was usually impossible to determine who had made the mistake or why. Finally, quite contrary to the impression he had received on his first day, Eric learned that loafing on the job not only was common practice among the clerks, but had indeed been developed into a rather elegant art form. It turned out that the clerks had devised ingenious ways to ‘busy out’ their consoles (i.e., to manipulate the console in order to provide the computer with a ‘busy’ indication when in fact the console was free). All a clerk needed to do, when she wanted a break from work, was to busy out her console and, if a supervisor happened to be nearby, act as if she were listening intently to a salesman on her headset. Worse, there appeared to be a highly efficient system of informal communication among the clerks, which alerted everyone when a supervisor was about to appear on the scene (or was monitoring calls surreptitiously from the private listening

Given his own observations and impressions, Eric was not surprised when, a few weeks after he had taken over management of the office, he was visited by the regional vice-president of the company. The vice-president informed him that sales were falling company-wide, and that at least part of the problem had to do with the quality of the information with which salesmen were being provided. Eric’s operation was one of the most critical points of co-ordination in the entire company, he said, and it was important to everyone in the company that Eric reduce both the error rate and the number of delays salesmen currently were experiencing. The vicepresident said he had enormous confidence in Eric’s managerial ability, that he was sure the problems would be remedied quickly, and that he viewed Eric’s future in the company with great optimism. Eric panicked.

Eric’s action plan Within two days he had instituted a crash programme to increase efficiency, reduce call-in delays, and slash the error rate. He held a half-day meeting with his four first-level supervisors, impressing upon them the urgency of the situation and the need for them to work with their people, individually if necessary, to improve service. He held an evening meeting with all staff members (with everyone receiving both refreshments and overtime pay), at which he announced a set of office-wide performance goals, and encouraged each employee to do her best to help achieve the new goals. He even had one of the supervisors construct four large signs reading ‘Increase Efficiency’ (each with a line drawing of a smiling face under the words), which were placed on the four walls of the operating area. Beginning the day after the kick-off meeting, all supervisory personnel (himself included) were to spend at least three hours a day on the floor, helping the employees improve their efficiency, making spot checks for errors, and generally doing anything possible to smooth the flow of work. The first two days under the new programme seemed to go reasonably well: the average waiting time for incoming calls dropped slightly, spot checks of errors showed performance to be close to an acceptable level, and everyone seemed to be

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Case study 2.1 continued working hard and intently. No longer, for example, did the employees take time to look up from their work and smile or exchange a few words when Eric entered the room. That bothered him a bit because he always had enjoyed chatting with the clerks, but he accepted the loss of the smiles as a small price to pay for the increases in efficiency he hoped for. On the third day, disaster struck. Eric did not notice until mid-morning that someone had carefully written ‘IN’ before ‘Efficiency’ on each of the four posters – and the smiles on the line drawings’ faces had been extended into full-fledged, if subtly sarcastic, grins. Worse, everyone seemed to be studiously ignoring both the posters and him. Even the first-level supervisors said nothing to him about the posters, although Eric noticed that the supervisors, like the clerks, collected in pairs and threes for animated conversation when they were not aware of his presence. When he walked out into the operating area to start his three-hour stint, all eyes looked away and stayed there. He had never felt so completely alone. That evening Eric stayed after everyone else had left; he removed the posters and pondered what to do next. With possibly one or two exceptions, he was sure that the people who worked for him were decent human beings. He knew that he himself was only trying to do his job, to get performance back up to standard. As he had told the employees at the kick-off meeting, this was in the best interest of everybody: the customers, the salesmen, the clerks, himself. So why the hostility towards him and his programme?

The root causes? Gradually he began to suspect that the problems he had confronted – high errors and delays, excessive absenteeism and turnover – were merely outcroppings of some more basic difficulty. Perhaps, he thought, he had attacked the symptom rather than the disease. But what was the disease? He considered each of the possibilities. He knew that there was a lot of complaining about the pay and the inflexibility of the hours. But the pay was actually very good, higher than for almost any other non-skilled job available to females in the suburban area – and every year there was a pay increase for everyone, which almost always was greater than the increase in the cost of living. The hours were a problem, he knew, but even those employees who complained the most knew that he had tried mightily to convince the regional

office to let him introduce a flexible scheduling plan that would allow the employees to better coordinate their personal and work lives. He had been told that company policy dictated an 8.30 to 5.00 workday and that hours (just like all other personnel policies) were centrally controlled in the interest of company-wide efficiency and regularity. Eric didn’t like the decision (he felt he needed to be given much more personal authority to be able to run his own operation effectively). He did, however, understand that there was some need for central coordination of policy, and he thought that the employees should also be able to see the necessity for it. The hours, he decided, could not conceivably be the root of all the difficulties. He considered briefly the possibility that the employees were simply not capable of doing the work at satisfactory levels of speed and accuracy. However, he knew that could not be the case: all had passed a company-administered ability test before they were hired and all had gone through a rigorous training programme which covered every contingency a person conceivably could face as an information clerk. Besides, the job was not all that difficult; he personally suspected that even the requirement of a high school diploma was superfluous, that anybody who could read and write could handle the job without significant difficulty. No, lack of ability was not the core of the problem. Indeed, as Eric reflected further, it seemed that the reverse could be true: that perhaps the job was so simple and routine that the clerks were bored – and therefore chose to be absent a lot and to loaf whenever they could on the job. But surely the high pay and the pleasantness of the work setting should more than compensate for any such feelings of boredom? Furthermore, holding errors below 2 per cent could provide a real challenge, and loafing on the job would itself probably be more boring than working. Supervision? It seemed most unlikely that this was the root of the difficulty. Each of the four supervisors had been information clerks themselves (although in the old days, when there was no computer and you had to look everything up in a set of reference manuals), and they knew the job inside out. Moreover, he knew from talking with the supervisors that they were genuinely committed to spending as much time as needed to help each clerk do as good a job as possible. Eric had observed each of them working on the floor many times, and there was no question in his mind about how much time and energy they spent in assisting and developing individual clerks.

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Kipsy

CONSIDER THE PLIGHT OF KIPSY

Then what? Maybe, he finally concluded, the key was Kipsy. Kipsy had been a thorn in his side (the supervisors agreed) ever since Eric started the job. Although she herself had been working as a clerk for less than a year, she already had emerged as one of the informal leaders of the workforce. Eric found himself agreeing with one of his supervisors who had suggested over coffee one morning that Kipsy alone created as many problems as a dozen other clerks taken together. He was 99 per cent confident, for example, that it was she who had mutilated his signs. He had been recently hearing rumblings that Kipsy was informally talking up the possibility of the clerks unionising, probably even affiliating with some national outfit that had no understanding of the local situation. He had tried to talk with her once. She had showed up unannounced at his office one day, with a long list of complaints about him and the work. His approach had been to listen and hear her out, to see what was troubling her, and then to do something about it – for her own sake, as well as for her supervisor and the company. Thinking back now, however, the main thing he remembered about the conversation (if you could call it a conversation) was her incredible anger. He was perplexed that he could not remember specifically what it was that she had been so mad about. Eric did recall telling her, as the conversation ended, that if she worked hard and effectively on her job for a year or two she would become eligible for enrolment in a company-run training course for a higher paying job. But again, he could not recall whether or not that had interested her. In any case, it was clear that Kipsy was the link pin in the informal network among the clerks – and if they were turning against him and the company, you could be pretty sure that she was right in the middle of it. The question, though, was what to do about it. Fire her? In a very important sense, that would be admitting defeat – and publicly. Talk to her again? That probably would result in nothing more than his getting another load of hostility dumped in his lap, and that he didn’t need. Eric was in trouble, and he knew it. He realised it first when he could not think of a good way to repair the damage that his new motivational programme apparently had created. But he knew it for sure when he found that he was no longer thinking about work except when he was actually at his desk in the office and had to do so. When he started this job he had expected to become totally immersed in it; indeed, he had wanted to be. But now he was psychologically fleeing from his job as much as the clerks seemed to be fleeing from theirs.

Kipsy has been an information clerk in Eric’s office for almost a year. In that year she has become increasingly frustrated and unhappy in her work – and she doesn’t know quite what to do about it. Things certainly have not worked out as she had expected them to.

Early optimism ... She had applied for the job because a friend told her that the company was a great place to work, that the pay was excellent, and that the people she would be working with were friendly and stimulating. Moreover, it was well known that the company was growing and expanding at a fast clip. That, Kipsy concluded, meant that there was a good chance for advancement for anyone who showed some initiative and performed well on the job. Advancement was important. Throughout her high school years, Kipsy had always been seen as a leader by her classmates, and she had enjoyed that role much more than she had let on at the time. Her grades had been good – mostly As and Bs – and she knew if she had pushed a bit harder she could have obtained almost all As. However, she had decided that participation in school activities, doing afterschool volunteer work, and (importantly) having friends and learning from them were just as important as grades; so she had deliberately let the grades slip a little. The man who interviewed Kipsy for the job was extremely nice – and what he said about the job confirmed her high hopes for it. He even took her into the room filled with the complicated-looking consoles and let her watch some of the people at work. It seemed like it would be great fun – though perhaps a little scary – working with all that computerised equipment. She didn’t know anything at all about computers. When they returned to the hiring area from their visit to the console room, Kipsy’s employment tests had been scored. The interviewer told her that she had scored in the top 10 per cent of all applicants for the job, that all signs pointed to a great future for her in the company, and that she could start training the next day if she wanted. Kipsy accepted the job on the spot. Training for the job was just as exciting as she had expected it to be. The console seemed awfully complicated, and there was no end to the special requests and problems she had to learn how to deal with. The other people working on the job were also very nice, and Kipsy soon had made many new friends.

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Case study 2.1 continued ... replaced by frustration and disappointment After a few weeks, however, the fun wore off. The kinds of difficult problems she had been trained to solve on the console seemed never to occur. Instead, the calls began to fall into what Kipsy experienced as an endless routine: the green light flashes, the salesman gives the name of a piece of equipment, you look it up in the book and punch the number on the keyboard, you recite the information displayed by the computer back to the salesman, and the green light goes off. Then you wait – maybe only a second, maybe five minutes – for the light to go on again. You never know how long you are going to wait, so you can never think or read or even carry on an uninterrupted conversation with the girl next to you. It was, Kipsy decided, pretty awful. Worse, many of her new friends were quitting. The rumour was that nearly 80 per cent of the people on the job quit every year, and Kipsy was beginning to understand why. Neither she nor any of her friends knew of anybody who had been promoted to management or to a better job from the ranks of the console operators, at least not in the last couple of years. Kipsy was also smart enough to realise that in time the whole operation would be automated – with salesmen punching in their requests for information directly from the field – at which time, she surmised, she and everyone else who had stuck out the job in hopes of something better would be laid off. The only good thing about the job, she concluded, was that she was becoming the informal leader of the work group – and that had its moments. Like the time one of the girls had her planned vacation postponed at short notice, supposedly because absenteeism was so high that everyone had to be available for work merely to keep up with the flow of incoming calls. The girl (and two of her friends) had come to Kipsy and asked what she could do about it. Kipsy had marched straightaway into the manager’s office with the girl, asked for an explanation, and got him to agree to let her take the vacation as planned. That felt awfully good. But such moments were too infrequent to keep her interested and involved – so she found herself making up interesting things to do, just to keep from going crazy. She developed a humorous list, Rules for Handling Salesmen, which she surreptitiously passed around the office, partly in fun but also partly to help the new girls (there always were a lot of new girls) learn the tricks necessary to keep from getting put down by the always impatient, sometimes crude

salesmen. She also found that girls having difficulties on the job (again, usually the new workers) often came to her rather than to the supervisors for help – which she gladly gave, despite the obvious disapproval of the supervisors. She even found herself assuming the role of monitor for the group, prodding girls who were not doing their share of the work, and showing new girls who were working too hard the various tricks that could be done to keep the pace of work at a reasonable level (such as ‘busying out’ the machine, when you just couldn’t take any more and needed a break). That was all fun, but as she reflected on it, it just didn’t compensate for the basic monotony of the work or for the picky, almost schoolmarmish attitude of the supervisors. So she was buoyed up when she heard that a new manager was coming, fresh out of school. The rumour mill had it that he was one of the top young managers in the company, and she decided he surely would shake things up a bit as soon as he found out how miserable it was for people who worked in the office.

The new boss Eric’s first few days on the job confirmed her high hopes for him: he seemed genuinely interested in learning about the job and in hearing what changes people had to suggest. And he talked directly to the people doing the work, rather than keeping safely out of sight and listening only to what the schoolmarms said people thought and felt. All to the good. Her opinion about Eric’s managerial abilities dropped sharply a few weeks later, however, by what came to be known around the office as the ‘flexible hours fiasco’. Kipsy and two other girls had come up with a proposal for pre-scheduling work hours so that there would be substantially more flexibility in the hours each person would work. The plan was designed so that management would know at least two days ahead of time who would be coming in when. The only cost to the company would be some additional clerical time spent on actually doing the scheduling, and Kipsy had obtained agreement from almost everyone in the office to share in the clerical tasks, in their own time. Eric had seemed receptive to the plan when Kipsy first presented it to him, and said only that he would have to check it out with his superiors before instituting it. Nothing more was heard about the plan for about two weeks. Finally Eric called Kipsy into his office and (after a good deal of talking around the issue) reported that ‘the people upstairs won’t let us do it’.

CHAPTER 2 THE NATURE OF ORGANISATIONAL BEHAVIOUR

Kipsy’s respect for Eric plummeted. Rather than give a flat no, he had wriggled around for two weeks, and then lamely blamed the decision on ‘the people upstairs’. She knew very well that the manager of an office could run his office however he pleased, so long as the work got done. And here was Eric, the bright new manager on the way up: ■

■ ■

He wouldn’t go along with an employee-initiated proposal for making their life at work more bearable. He refused to take personal responsibility for that decision. He even had the gall to ask Kipsy to help ‘explain to the girls’ how hard he had tried to get the plan approved, and how sad he was that it had been turned down.

Kipsy’s response was a forced smile, an elaborately sympathetic ‘Of course I’ll help’, and a quick escape from his office.

Kipsy’s demands She took the Monday of the next week off, to think about whether or not she should quit and try to find a better job. At the end of the day, she made up a list of what she wanted from her work, what she was getting, and whether or not things would improve if she stuck with the job: My wants

Am I getting them?

Hope for improvement

1 Good pay

OK, not great

Little, till my hair turns grey

2 Interesting people

Fine

No change, except friends keep leaving

3 Interesting work

Dismal

Zero

4 Chance to show initiative and personal responsibility

None

No hope

5 Chance to contribute to an organisation I believe in

Low

Ha!

The next day, Tuesday, she took her list and went to see Eric. After listening to a fatherly lecture on the importance of not missing work, especially on Mondays when the workload was heaviest, she began to tell him how upset she was. She told him that the only thing she got from working hard on

the job was a backache every evening. She told him she had been misled about the chances for promotion on the job, and she asked him, as politely as she knew how, what he suggested she should do. Eric’s response blew her mind. There was a new programme, he said, in which people who did well on entry-level jobs for a few years could apply for advanced training in a technical specialty. This training would be done at company expense and in company time, and would qualify her for a promotional-type transfer, whenever openings in her chosen specialty developed. If she worked hard and was rated high on the quarterly supervisory assessments, Eric said, he would be prepared to nominate her for the advanced training. It was important, however, he emphasised, that she behave herself – no unnecessary absences, high work productivity, good ratings by her supervisors. Otherwise, she certainly would not be selected by ‘the people upstairs’ for the new programme. Something snapped. What kind of a fool did he think she was? How long did he expect her to wait for a ‘chance to be nominated’ for some foggy ‘technical training programme’? She started telling him, no holds barred now, no false politeness, exactly what she thought of the job, of the supervisors, even of the way he was running the office. The more she talked, the madder she got – until finally she got up, almost in tears, and ran out leaving behind only the reverberations of a well-slammed door.

Kipsy’s dilemma She was ashamed later, of course. She knew she would be, and she was, but she also was too embarrassed to go up to Eric and apologise. Which was too bad, because she suspected that behind it all Eric was probably a decent man, and maybe even somebody she could learn to like and respect – if only he would let himself be human once in a while. However, she knew there was nothing she could do to change the way Eric did his job; the first move clearly had to be his. It could be a long wait, Kipsy decided. In the meantime she would come to work, try to minimise her backaches and upsets, and continue to think about finding another job. Of one thing she was sure: no more ‘bright ideas’ for improving things at the office would come from her; they brought nothing but grief. Furthermore, she was no longer going to worry so much if she happened to misremember a catalogue number or accidentally disconnect a salesman. If all they wanted was a machine, that was all they were going to get. Kipsy found herself much less able to be cavalier about her work than she had thought she could be.

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Case study 2.1 continued As hard as she tried not to care when she made errors, the distressing fact was that mistakes still did bother her. And she still felt like an unreconstituted sinner when she was a few minutes late for work. It took the ‘Increase Efficiency’ programme to finally break her completely. It was not to be believed: an evening meeting, complete with supposedly inspirational messages from all the bosses about how we all had to pitch in and help the company make more money; grade school posters on all the walls imploring people to work harder; and, to top it all, all the bosses, even Eric, standing around for hours at a time, looking over everybody’s shoulders, day after day. Did Eric really believe that treating people like children would make them work harder? She could have told him straight out beforehand that the programme would make things worse rather than better. But of course he didn’t ask. Kipsy went on the offensive. She knew it was wrong, but she also knew she had to do something to preserve her sanity. Her first target was the signs; she and another girl stayed late in the rest room and, when everybody else had left, carefully changed the lettering of the signs to read ‘Increase INEfficiency’, and turned the smiling face on each sign into an obviously sarcastic grin. Kipsy also began discussing with the other girls the possibility of forming a club, which would be partly social but which could possibly develop into a vehicle for doing some hard-nosed bargaining with Eric. It didn’t work. Changing the signs, after the initial thrill, only made her feel more guilty. And even

though virtually everyone in the office shared her dismay about the monotony of the work and was as upset as she about Eric and his ‘Increase Efficiency’ programme, nobody was very excited about forming a club. Some thought it wouldn’t have any impact and would be a waste of time; others thought it sounded like the first step towards unionisation, which they didn’t want. So the club idea died. Kipsy was depressed. What should she do? Quit? Her preliminary explorations had not yet turned up any jobs which were much better – and most paid less than this one. Besides, to quit would be to admit publicly her inability to change anything in the office. She was supposed to be the leader of the girls in the office; she shouldn’t become just one more tally towards the 80 per cent a year who left. Talk to Eric again? She seriously doubted that he would listen to one word she said. And she doubted equally seriously that she could keep herself from blowing up again at him – which would accomplish nothing and help no one. Shut up and stick it out? That was what she had been trying for the last three months. Without noticeable success. What, then?

YOUR TASKS (a) Analyse the issues of management and organisational behaviour which are raised in this case study. (b) Suggest solutions to the problems faced by Eric and Kipsy.

NOTES AND REFERENCES 1. A summary of some merits in understanding organisational behaviour theory and the role of management is given in Mullins, L. J. ‘The Organisation and the Individual’, Administrator, vol. 7, no. 4, April 1987, pp. 11–14. 2. ’Introduction to Module 6, Organizational Behaviour’, Financial Times Mastering Management, FT Pitman Publishing (1997), p. 216. 3. See, for example: Luthans, F. Organisational Behaviour, Seventh edition, McGraw-Hill (1995). 4. See, for example: Robbins, S. P. Organizational Behavior: Concepts, Controversies, Applications, Eighth edition, Prentice-Hall (1998). 5. For further details of recurring themes in organisational behaviour and premises about life in organisations see,

6. 7.

8.

9.

for example: Porter, L. W., Lawler, E. E. and Hackman, J. R. Behaviour in Organisations, McGraw-Hill (1975). Wilson, F. M. Organzational Behaviour: A Critical Introduction, Oxford University Press (1999). McPhee, N. ‘Gaining Insight on Business and Organisational Behaviour: the Qualitative Dimension’, International Journal of Market Research, vol. 44, Winter 2002, pp. 53–72. Yip, G. S. ‘Global strategy in the Twenty-first Century’, in Crainer, S. and Dearlove, D. (eds) Financial Times Handbook of Management, Second edition, Financial Times Prentice Hall (2001), p. 151. Morgan, G. Creative Organization Theory, Sage Publications (1989), p. 26.

CHAPTER 2 THE NATURE OF ORGANISATIONAL BEHAVIOUR

10. Hellriegel, D., Slocum, J. W. and Woodman, R. W. Organizational Behavior, Eighth edition, South-Western Publishing (1998), p. 5. 11. Wood, J. ‘Deep Roots and Far From a “Soft” Option’, Financial Times Mastering Management, FT Pitman Publishing (1997), p. 217. 12. Bennis, W. ‘Foreword’, in Cloke, K. and Goldsmith, J. The End of Management and the Rise of Organizational Democracy, Jossey-Bass (2002), p. ix. 13. Gratton, L. Living Strategy: Putting People at the Heart of Corporate Purpose, Financial Times Prentice Hall (2000), pp. 12–13. 14. Morgan, G. Images of Organization, Second edition, Sage Publications (1997). 15. Drummond, H. Introduction to Organizational Behaviour, Oxford University Press (2000). 16. Goldthorpe, J. H., Lockwood, D., Bechofer, F. and Platt, J. The Affluent Worker, Cambridge University Press (1968). 17. Herman, S.W. ‘How Work Gains Meaning in Contractual Time: a narrative model for reconstructing the work ethic’, Journal of Business Ethics, vol. 38, no. 1–2, June 2002, pp. 65–79. 18. Knights, D. and Willmott, H. Management Lives: Power and Identity in Work Organizations, Sage Publications (1999). 19. Reeves, R. ‘Reality Bites’, Management Today, March 2003, p. 35. 20. Cartwright, J. Cultural Transformation, Financial Times Prentice Hall (1999), p. 27. 21. Oliver, J. ‘Losing Control’, Management Today, June 1998, pp. 32–8. 22. See, for example, Argyris, C. Integrating the Individual and the Organization, John Wiley & Sons (1964). 23. ’In Celebration of the Feel-good Factor’, Professional Manager, March 1998, p. 6. 24. Bassett, G. ‘The Case against Job Satisfaction’, Business Horizons, vol. 37, no. 3, May–June 1994, p. 62 and p. 63. 25. Egan, G. ‘The Shadow Side’, Management Today, September 1993, pp. 33–8. 26. See, for example, Robinson, G. ‘Improving performance through people’, The British Journal of Administrative Management, September/October 1999, pp. 4–5. 27. Chowdhury, S. Management 21C, Financial Times Prentice Hall (2000), p. 119. 28. See, for example: Schein, E. H. Organizational Psychology, Third edition, Prentice-Hall (1988). 29. Kotter, J. P. ‘The Psychological Contract: Managing the Joining-Up Process’, California Management Review, vol. 15, no. 3, 1973, pp. 91–9. 30. Stalker, K. ‘The Individual, the Organisation and the Psychological Contract’, The Institute of Administrative Management, July/August 2000, pp. 28, 34. 31. Cartwright, J. Cultural Transformation, Financial Times Prentice Hall (1999), p. 39. 32. Emmott, M. ‘The Psychological Contract: Managers Do Make a Difference’, Manager, The British Journal of Administrative Management, September/October 2001, p. 15. 33. McBain, R. ‘The Role of Human Resource Management and the Psychological Contract’, Manager Update, vol. 8, no. 4, Summer 1997, pp. 22–31.

34. Stalker, K. ‘The Individual and the Organisation’, Student Adviser Issue No. 51, The Institute of Administrative Management, Spring 2003. 35. Hiltrop, J. M. ‘Managing the Changing Psychological Contract’, Employee Relations, vol. 18, no. 1, 1996, pp. 36–49. 36. Stiles, P., Gratton, L., Truss, C., Hope-Hailey, V. and McGovern, P. ‘Performance Management and the Psychological Contract’, Human Resource Management Journal, vol. 7, no. 1, 1997, pp. 57–66. 37. Ghoshal, S., Bartlett, C. A. and Moran, P. ‘Value Creation: The New Millennium Management Manifesto’, in Chowdhury, S. Management 21C, Financial Times Prentice Hall (2000), pp. 121–40. 38. Peter, L. J. and Hull, R. The Peter Principle, Pan Books (1970), p. 22. 39. Ibid., p. 56. 40. Parkinson, C. N. Parkinson’s Law, Penguin Modern Classics (2002), p. 14 41. HRH The Duke of Edinburgh, ‘Introduction’ to Parkinson, C. N. Parkinson’s Law, Penguin Modern Classics (2002), pp. 9–10. 42. Herbertson, I. ‘Books’, Management Today, May 2000, p. 4. 43. Tayeb, M. The Management of a Multicultural Workforce, John Wiley & Sons (1996). 44. Schneider, S. C. and Barsoux, J. Managing Across Cultures, Second edition, Financial Times Prentice Hall (2003), p. 9. 45. Thompson, P. and McHugh, D. Work Organisations: A Critical Introduction, Third edition, Palgrave (2002), p. 81. 46. Brooks, I. Organisational Behaviour: Individuals Groups and Organisation, Second edition, Financial Times Prentice Hall (2003), p. 264. 47. Trompenaars, F. ‘Trans-Cultural Competence’, People Management, 22 April 1999, p. 31. 48. Francesco, A. M. and Gold, B. A. International Organizational Behavior: Text, Readings, Cases and Skills, Prentice Hall (1998), p. 103. 49. Schneider, S. C. and Barsoux, J. Managing Across Cultures, Second edition, Financial Times Prentice Hall (2003) p. 167. 50. Ibid., p. 86. 51. Francesco, A. M. and Gold, B A. International Organizational Behavior: Text, Readings, Cases and Skills, Prentice Hall (1998), p. 144. 52. Adler, N. J. International Dimensions of Organisational Behaviour, Third edition, South Western College Publishing (1997). 53. Robbins, S. Essentials of Organizational Behaviour, Third edition, Prentice Hall (1992), p. 14. 54. Maurice, M., Sorge, A. and Warner, M. ‘Societal Differences in Organising Manufacturing Units’, Organisation Studies (1980), vol. 1, no. 1, pp. 63–91. 55. Hofstede, G. Culture’s Consequences: International Differences in Work-related Values, Sage Publications (1980). 56. Trompenaars, F. and Hampden-Turner, C. Riding the Waves of Culture, Second edition, Nicholas Brealey (1999) 57. Hall, E. T. and Hall, M. R. ‘Key Concept: Underlying Structures of Culture’, in Lane, H. W., Di Stefano, J. J., and Masnevski, M. L. International Management Behavior, Third edition, Cambridge, MA: Blackwell, (1997).

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58. Tayeb, M. International Management: Theories and Practices, Financial Times Prentice Hall (2003). 59. Brooks, I. Organisational Behaviour: Individuals, Groups and Organisation, Second edition, Financial Times Prentice Hall (2003). 60. Hofstede, G. Culture’s Consequences: International Differences in Work-related Values, Sage Publications (1980). 61. Hofstede, G. and Bond, M. H. ‘The Confucius Connection: From Cultural Roots to Economic Growth’ Organisational Dynamics, Spring 1988, pp. 4–21.

FT

62. Holden, N. J. Cross-Cultural Management: A Knowledge Management Perspective, Financial Times Prentice Hall (2002), p. 51. 63. Trompenaars, F. and Hampden-Turner, C. Riding the Waves of Culture, Second edition, Nicholas Brealey (1999). 64. Hall, E. T. and Hall, M. R. Understanding Cultural Differences, Intercultural Press (1990). 65. Grint, K. The Sociology of Work, Second edition, Polity (1998), p. 298. 66. Ibid., p. 298. 67. Thompson, P. and McHugh, D. Work Organisations: A Critical Introduction , Third edition, Palgrave (2002), p. 74.

Use the Financial Times to enhance your understanding of the context and practice of management and organisational behaviour. Refer to articles 1, 10, 12 and 19 in the BUSINESS PRESS section at the end of the book for relevant reports on the issues explored in this chapter.

3

APPROACHES TO ORGANISATION AND MANAGEMENT

Management is a discursive subject and much has been written about it. The study of organisations and management theory has, therefore, to proceed on a broad front. It is the comparative study of the different approaches which will yield benefits to the manager. The study of organisations, their structure and management is important for the manager. Identification of major trends in organisational behaviour, and the work of leading writers, provide a perspective on concepts and ideas discussed in more detail in other chapters.1

LEARNING OUTCOMES After completing this chapter you should be able to:
explain the relationships between management theory and practice;
identify major trends in the development of organisational behaviour and management thinking;
contrast main features of different approaches to organisation and management;
evaluate the relevance of these different approaches to the present-day management of organisations;
assess the value of the study of management theory and different approaches to organisation and management;
recognise the relationship between the development of theory, behaviour in organisations and management practice;
establish a basis for consideration of aspects of management and organisational behaviour discussed in following chapters.

Photo: Larry Mulvehill/Science Photo Library

Although there might be general agreement from time to time on what constitutes best management practice, the theoretical ingredients will tend to vary. Management theories are therefore contestable rather than definitive and, although there is a sense of progressive, evolutionary refinement, there is no master narrative to reassure us that the latest theory is necessarily the best. John Sheldrake Management Theory: From Taylorism to Japanization, International Thompson Business Press (1996)

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MANAGEMENT THEORY Writing on organisation and management, in some form or another, can be traced back thousands of years.2 However, the systematic development of management thinking is viewed, generally, as dating from the end of the nineteenth century with the emergence of large industrial organisations, and the ensuing problems associated with their structure and management.3,4 A central part of the study of organisation and management is the development of management thinking and what might be termed management theory. The application of theory brings about change in actual behaviour. Managers reading the work of leading writers on the subject might see in their ideas and conclusions a message about how they should behave. This will influence their attitudes towards management practice. As McGregor puts it: Every managerial act rests on assumptions, generalizations, and hypotheses – that is to say, on theory. Our assumptions are frequently implicit, sometimes quite unconscious, often conflicting; nevertheless, they determine our predictions that if we do a, b will occur. Theory and practice are inseparable.5

Importance of management theory

The study of management theory is important, therefore, for the following reasons: ■ ■ ■ ■ ■

What leading writers say is an important part of the study of management. It is necessary to view the interrelationships between the development of theory, behaviour in organisations and management practice. An understanding of the development of management thinking helps in understanding principles underlying the process of management. Knowledge of the history helps in understanding the nature of management and organisational behaviour, and reasons for the attention given to main topic areas. Many of the earlier ideas are of continuing importance to the manager and later ideas on management tend to incorporate earlier ideas and conclusions. There is much truth in the saying that every living practitioner is prisoner to the ideas of a dead theorist. Immunized by their daily confrontation with the ‘real world’ corporate managers typically exhibit a healthy distrust of theory that has, in general, served them well.6

DEVELOPMENTS IN MANAGEMENT AND ORGANISATIONAL BEHAVIOUR It is helpful, therefore, to trace major developments in management and organisational behaviour, and what has led to the concentration of attention on such topics as structure, motivation, groups, leadership and organisation development. Miner makes the point that the more that is known about organisations and their methods of operation, the better the chances of dealing effectively with them. Understanding may be more advanced than prediction, but both provide the opportunity to influence or to manage the future. Theory provides a sound basis for action.7 However, if action is to be effective, the theory must be adequate and appropriate to the task and to improved organisational performance. It must be a ‘good’ theory. In order to help identify main trends in the development of organisational behaviour and management theory, it is usual to categorise the work of writers into various ‘approaches’, based on their views of organisations, their structure and management. Although a rather simplistic process it does provide a framework in which to help direct study and focus attention on the progression of ideas concerned with improving organisational performance.

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Figure 3.1 Main approaches to organisation, structure and management

A framework of analysis

There are, however, many ways of categorising these various approaches. For example, Skipton attempts a classification of 11 main schools of management theory.8 Whatever form of categorisation is adopted, it is possible to identify a number of other approaches, or at least sub-divisions of approaches, and cross-grouping among the various approaches. The choice of a particular categorisation is therefore largely at the discretion of the observer. The following analysis will revolve around a framework based on four main approaches: ■ ■ ■ ■

classical – including scientific management and bureaucracy human relations – including neo-human relations systems contingency (see Figure 3.1).

However, attention is also drawn to other ‘approaches’ or ideas, including: ■ ■ ■

decision-making social action postmodernism (see Figure 3.3, p. 88).

THE CLASSICAL APPROACH The classical writers thought of the organisation in terms of its purpose and formal structure. They placed emphasis on the planning of work, the technical requirements of the organisation, principles of management, and the assumption of rational and logical behaviour. The analysis of organisation in this manner is associated with work carried out initially in the early part of the last century, by such writers as Taylor, Fayol, Urwick, Mooney and Reiley, and Brech. Such writers were laying the foundation for a comprehensive theory of management. A clear understanding of the purpose of an organisation is seen as essential to understanding how the organisation works and how its methods of working can be improved. Identification of general objectives would lead to the clarification of purposes and responsibilities at all levels of the organisation, and to the most effective structure. Attention is given to the division of work, the clear definition of duties and responsibilities, and maintaining specialisation and co-ordination. Emphasis is on a hierarchy of management and formal organisational relationships.

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Sets of principles

The classical writers (also variously known as the formal or scientific management writers – although scientific management is really only a part of the classical approach) were concerned with improving the organisation structure as a means of increasing efficiency. They emphasised the importance of principles for the design of a logical structure of organisation. Their writings were in a normative style and they saw these principles as a set of ‘rules’ offering general solutions to common problems of organisation and management. Most classical writers had their own set of principles but among the most publicised are those of Fayol and Urwick. Fayol recognised there was no limit to the principles of management but in his writing advocated 14.9 Urwick originally specified eight principles, but these were revised to ten in his later writing.10 (See Chapters 6 and 15.) Mooney and Reiley set out a number of common principles which relate to all types of organisations. They place particular attention on: ■ ■ ■

the principle of co-ordination – the need for people to act together with unity of action, the exercise of authority and the need for discipline; the scalar principle – the hierarchy of organisation, the grading of duties and the process of delegation; and the functional principle – specialisation and the distinction between different kinds of duties.11

Brech attempts to provide a practical approach to organisation structure based on tried general principles as opposed to the concentration on specific cases or complex generalisations of little value to the practising manager. He sets out the various functions in the organisation and the definition of formal organisational relationships.12 Although clearly a strong supporter of the formal approach in some of his views such as, for example, on the principle of span of control, Brech is less definite than other classical writers and recognises a degree of flexibility according to the particular situation. Brech does place great emphasis, however, on the need for written definition of responsibilities and the value of job descriptions as an aid to effective organisation and delegation. This work builds on the ideas of earlier writers, such as Urwick, and, therefore, provides a comprehensive view of the classical approach to organisation and management.

Evaluation of the classical approach The classical writers have been criticised generally for not taking sufficient account of personality factors, and for creating an organisation structure in which people can exercise only a limited control over their work environment. The idea of sets of principles to guide managerial action has also been subject to much criticism. For example, Simon writes: Organisational design is not unlike architectural design. It involves creating large, complex systems having multiple goals. It is illusory to suppose that good designs can be created by using the so-called principles of classical organisation theory.13

Research studies have also expressed doubt about the effectiveness of these principles when applied in practice.14 However, although the work of the classical writers is sometimes regarded as an out-ofdate approach it does focus attention on important factors in the study of organisation and management. Technical and structural factors are important considerations in improving organisational performance. Yet, while attention to formal structure is important, it is also necessary to consider the people who work within the structure. The classical approach prompted the start of a more scientific view of management and attempted to provide some common principles applicable to all organisations. These principles are still of some relevance in that they provide general guidelines to

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CHAPTER 3

the structuring and efficiency of organisations. They provide a useful starting point in attempting to analyse the effectiveness of the design of organisation structure. However, the application of these principles must take full account of: ■ ■

Major subgroupings

the particular situational variables of each individual organisation; and the psychological and social factors relating to members of the organisation.

Two major ‘sub-groupings’ of the classical approach are: 1 scientific management, and 2 bureaucracy.

SCIENTIFIC MANAGEMENT Many of the classical writers were concerned with the improvement of management as a means of increasing productivity. At this time emphasis was on the problem of obtaining increased productivity from individual workers through the technical structuring of the work organisation and the provision of monetary incentives as the motivator for higher levels of output. A major contributor to this approach was F. W. Taylor (1856–1917), the ‘father’ of scientific management.15 Taylor believed that in the same way that there is a best machine for each job, so there is a best working method by which people should undertake their jobs. He considered that all work processes could be analysed into discrete tasks and that by scientific method it was possible to find the ‘one best way’ to perform each task. Each job was broken down into component parts, each part timed, and the parts rearranged into the most efficient method of working.

Principles to guide management Taylor was a believer in the rational–economic needs concept of motivation. He believed that if management acted on his ideas, work would become more satisfying and profitable for all concerned. Workers would be motivated by obtaining the highest possible wages through working in the most efficient and productive way. Taylor was concerned with finding more efficient methods and procedures for co-ordination and control of work. He set out a number of principles to guide management. These principles are usually summarised as: ■ ■ ■

Photo: Derek Allan/Travel Ink

■

Scientific management on a building site

the development of a true science for each person’s work; the scientific selection, training and development of the workers; co-operation with the workers to ensure work is carried out in the prescribed way; the division of work and responsibility between management and the workers.

In his famous studies at the Bethlehem Steel Corporation, Taylor, who was appointed as a management consultant, applied his ideas on scientific management to the handling of pig iron. A group of 75 men were loading an aver1 age of l2 2- tons per man per day. Taylor selected a Dutch labourer, called Schmidt, whom he reported to be a ‘high-priced’ man with a reputation for placing a high value on money, and a man of limited mental ability.

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By following detailed instructions on when to pick up the pig iron and walk, and when to 1 sit and rest, and with no back talk, Schmidt increased his output to 472- tons per day. He maintained this level of output throughout the three years of the study. In return Schmidt received a 60 per cent increase in wages compared with that paid to the other men. 1 One by one other men were selected and trained to handle pig iron at the rate of 472tons per day and in return they received 60 per cent more wages. Taylor drew attention to the need for the scientific selection of the workers. When the other labourers in the group were trained in the same method only one in eight was physically capable of the 1 effort of loading 472- tons per day, although there was a noticeable increase in their level of output.

Reactions against scientific management

There were strong criticisms of, and reaction against, scientific management methods from the workers who found the work boring and requiring little skill. Despite these criticisms Taylor attempted to expand the implementation of his ideas in the Bethlehem Steel Corporation. However, fears of mass redundancies persuaded the management to request Taylor to moderate his activities. However, Taylor’s belief in his methods was so strong that he would not accept management’s interference and eventually his services were dispensed with. Scientific management was applied for a time in other countries with similar criticisms and hostile reactions. The ideas of scientific management were also adopted in the American Watertown Arsenal despite the lingering doubts of the controller. He was not convinced about the benefits of paying bonuses based on methods which reduced time taken to complete a job; also the workers reacted unfavourably to time and motion studies, and he was fearful of a strike. The controller eventually gave way, however, and the approach of scientific management was adopted – to be followed almost immediately by a strike of moulding workers. The strike at Watertown Arsenal led to an investigation of Taylor’s methods by a House of Representatives Committee which reported in 1912. The conclusion of the committee was that scientific management did provide some useful techniques and offered valuable organisational suggestions, but gave production managers a dangerously high level of uncontrolled power. The studies at Watertown Arsenal were resumed but the unions still retained an underlying hostility towards scientific management. A subsequent attitude survey among the workers revealed a broad level of resentment and hostility, by both union and non-union members, to scientific management methods. As a result of this report Taylor’s methods of time study were banned in defence establishments by the Senate.

Functional foremen

Taylor also put forward the idea of functional foremanship under which workers would be responsible simultaneously to eight different, specialist first-line supervisors. The eight supervisors were divided into two groups: 1 Planning, concerned with (i) order of work, (ii) instruction cards, (iii) time and costing and (iv) discipline; and 2 Performance, concerned with (v) gang boss, (vi) speed boss, (vii) repair boss and (viii) inspector. The idea of functional foremen represented a practical application of the idea of specialisation and the belief that each person’s work should, as far as possible, be confined to a single leading function. However, such an arrangement gives rise to problems of co-ordination, role conflict and unity of command. The idea of functional foremanship appears not to have become very popular and to have had little application in practice.

CHAPTER 3

Taylorism as management control

APPROACHES TO ORGANISATION AND MANAGEMENT

There has also been considerable interest in ‘Taylorism’ as representing a system of management control over workers. Taylor placed emphasis on the content of a ‘fair day’s work’ and on optimising the level of workers’ productivity. A major obstacle to this objective was ‘systematic soldiering’ and what Taylor saw as the deliberate attempt by workers to promote their own best interests and to keep employers ignorant of how fast work, especially piece-rate work, could be carried out. According to Braverman, scientific management starts from the capitalist point of view and method of production, and the adaptation of labour to the needs of capital. Taylor’s work was more concerned with the organisation of labour than with the development of technology. A distinctive feature of Taylor’s thought was the concept of management control.16 Braverman suggests that Taylor’s conclusion was that workers should be controlled not only by the giving of orders and maintenance of discipline, but also by removing from them any decisions about the manner in which their work was to be carried out. By division of labour, and by dictating precise stages and methods for every aspect of work performance, management could gain control of the actual process of work. The rationalisation of production processes and division of labour tends to result in the de-skilling of work and this may be a main strategy of the employer.17 Cloke and Goldsmith also suggest that Taylor was the leading promoter of the idea that managers should design and control the work process scientifically in order to guarantee maximum efficiency. He believed in multiple layers of management to supervise the work process and in rigid, detailed control of the workforce. Taylor’s theories justified managerial control over the production process and removed decision making from employees and from owners as well. The increasingly authoritative operational role of management diminished the direct involvement of owners in day-to-day decision making. Managers saw this as an opportunity to solidify their power and adopted Taylor’s ideas wholesale. In the process, they affirmed efficiency over collaboration, quantity over quality, and cost controls over customer service.18

RELEVANCE OF SCIENTIFIC MANAGEMENT While Taylor’s work is often criticised today it should be remembered that he was writing at a time of industrial reorganisation and the emergence of large, complex organisations with new forms of technology. Taylor’s main concern was with the efficiency of both workers and management. He believed his methods of scientific management would lead to improved management–labour relations, and contribute to improved industrial efficiency and prosperity. Taylor adopted an instrumental view of human behaviour together with the application of standard procedures of work. Workers were regarded as rational, economic beings motivated directly by monetary incentives linked to the level of work output. Workers were viewed as isolated individuals and more as units of production to be handled almost in the same way as machines. Hence, scientific management is often referred to as a machine theory model. The work of Taylor continues to evoke much comment and extreme points of view. For example, Rose suggests that: It is difficult to discuss the ‘contribution’ of F. W. Taylor to the systematic study of industrial behaviour in an even-tempered way. The sheer silliness from a modern perspective of many of his ideas, and barbarities they led to when applied in industry, encourage ridicule and denunciation.19

The theme of inefficiency

Rose argues that Taylor’s diagnosis of the industrial situation