Organizational Psychology
Lecture 1 - Organizational Theory
An organization is a collection of people who work together and coordinate their actions in
order to achieve individual and organizational goals
Organizational Behavior
Examining the factors that influence how individuals and groups act in organizations and
how organizations respond to their environment.
Organizational Theory
Classic → Human Relations → Systems ---> Contingency → Postmodern
Classical Approach
Objective: To improve the organizational structure in order to increase efficiency.
The classical approach placed emphasis on the planning of work, the technical requirements
of the organization, principles of management, and the assumption of rational behavior.
Attention is given to the division of work, a clear definition of responsibilities, and maintaining
specialization and coordination. Emphasis is on the hierarchy of management and formal
organizational relationships.
Bureaucracy (Weber)
Scientific Management (Taylor)
Fordism (Ford)
Normative
‘Big’ names:
- Mooney & Reiley
- Principle of coordination: the need for people to act together with unity of
action, exercising authority, need for discipline
- ‘Scalar principle’: the hierarchy of organizations (vertical division), the grading
of duties, and the process of delegation
- Functional principle: specialization and the distinction between different kinds
of duties, horizontal division
- difference between line and staff
- Taylor
Taylor believed that the amount of time and effort that each employee put into
producing something can be reduced by splitting up the work, which will make the
whole process a lot more efficient. He developed four principles to increase efficiency
in the workplace
- Principles:
- Responsibility for the organization of work from the employee to the
manager
- Use of scientific methods in order to determine the most efficient way
of working
- Scientific selection, training, and development of employees on the
basis of skill and ability to perform a task and train them to perform the
task accurately according to the prescribed rules.
, - Monitoring job performance, establishing a fair and acceptable
performance target and develop a reward system that is higher than
the acceptable level
- Employees as ‘machines’
- The idea is that people are motivated by financial gain.
- Ford
- inspired by Taylor
- mass production (assembly line)
- standardized products
- low costs
- strong division of labor
- standard salary, enough to be able to buy products
- paternalistic (education, homes, healthcare)
- Weber
He emphasized the importance of administration based on expertise (rules experts)
and administration based on discipline (rules of officials).
- Bureaucracy
- Characteristics by Stewart:
- Specialization (of the function, not the employee), division of labor
- Advantage: Efficiency will increase through specialization
- Hierarchy
- Advantage: A clear chain of command will develop from the
highest to the lowest level of an organization
- Formal selection
- Advantage: employees will be hired and promoted based on
merit and expertise benefits both them and employer
- Career orientation
- Advantage: The hiring of “career” professionals will ensure the
performance of assigned duties without regard for extraneous
pressures
- System of rules and regulations
- Advantage: Efficiency will increase as formal rules and other
controls relating to employee performance are enforced
- Impersonality
- Advantage: When rules and other controls are applied
impersonally and uniformly, involvement with personalities and
personal preferences is avoided. Subordinates are therefore
protected from arbitrary actions of their superiors
Criticism
In general:
The classical approach ignores the psychical and social processes of employees
- limits the psychological growth of the employee
- boredom (need for variety)
- limited development and use of skills
- limited participation
- limited freedom to determine your own working methods, …
- inflexibility
, - rules must be followed obediently
- ignores the external environment of the organization
Taylor:
- strong division of labor (deskilling)
- little or no opportunity for employees to exercise control over their work
Despite the criticism, the standardization aspect of Taylorism is ‘alive’ in some places, such
as hotels having strict guidelines and the structure of McDonald’s.
Weber:
- The over-emphasis of rules and other controls may become “ends” rather than
“means”
- Lack of appreciation or concern for changed conditions
- Officials may develop a dependence upon bureaucratic status, symbols, and rules
- Delegation of authority to lower levels may encourage an emphasis on
subunit rather than overall goals → subunit conflict and decreased
effectiveness
- ‘Working to the rules’ may lead to feelings of failure and frustrations
Traditional Approach to Motivation and Control
Human Relations Approach
Explains the informal relations among employers and employees are concerned with moral
and psychological rather than legal aspects of an organization.
‘Humanizing the work organization’
- focus on employee as an individual
- analyzing what motives employees
Mayo: The Hawthrone experiments
In a study on increasing employee productivity, it was found that productivity was mainly
increased by the presence of the researchers. Employees wanted to do their best under the
watchful eye of a researcher because of the attention and being part of a study (Hawthrone
effect). This effect makes it clear that a manager’s behavior or leadership style can influence
the performance of employees. This resulted in a Human Relations movement that very
specifically tried to increase employee productivity by training managers to deal with their
employees.
- worker output + satisfaction related to social factors (e.g. treatment of employees)
Attention to:
, - the informal structure within organizations
- leadership, motivation, communication
- the needs of the employees
- groups within the organization
→ The idea is that employees aren’t just motivated by money
Human Relations Approach to Motivation and Control
Criticism
Scientific quality: the methodological value of the Hawthrone studies
Satisfied employee → productive employee
Ignores the organization and the context of the organization
‘People without organizations’
Systems Approach
Organizations as an Open System
In open organizations, the
organization takes in
resources from its external
environment and processes
or converts them into goods
and services that are sent
back to that environment,
where customers can buy
them.
The organizational procedure
is a code of conduct or routine
that an employee follows in
order to perform a task most
effectively.
Challenge input stage: the challenge of developing a set of organizational behaviors or
procedures that allows employees to identify high-quality resources and purchase them ar
an affordable price.
Challenge conversion stage: developing a set of behaviors and procedures that results in
high-quality goods and services that are developed with the least possible costs.
Lecture 1 - Organizational Theory
An organization is a collection of people who work together and coordinate their actions in
order to achieve individual and organizational goals
Organizational Behavior
Examining the factors that influence how individuals and groups act in organizations and
how organizations respond to their environment.
Organizational Theory
Classic → Human Relations → Systems ---> Contingency → Postmodern
Classical Approach
Objective: To improve the organizational structure in order to increase efficiency.
The classical approach placed emphasis on the planning of work, the technical requirements
of the organization, principles of management, and the assumption of rational behavior.
Attention is given to the division of work, a clear definition of responsibilities, and maintaining
specialization and coordination. Emphasis is on the hierarchy of management and formal
organizational relationships.
Bureaucracy (Weber)
Scientific Management (Taylor)
Fordism (Ford)
Normative
‘Big’ names:
- Mooney & Reiley
- Principle of coordination: the need for people to act together with unity of
action, exercising authority, need for discipline
- ‘Scalar principle’: the hierarchy of organizations (vertical division), the grading
of duties, and the process of delegation
- Functional principle: specialization and the distinction between different kinds
of duties, horizontal division
- difference between line and staff
- Taylor
Taylor believed that the amount of time and effort that each employee put into
producing something can be reduced by splitting up the work, which will make the
whole process a lot more efficient. He developed four principles to increase efficiency
in the workplace
- Principles:
- Responsibility for the organization of work from the employee to the
manager
- Use of scientific methods in order to determine the most efficient way
of working
- Scientific selection, training, and development of employees on the
basis of skill and ability to perform a task and train them to perform the
task accurately according to the prescribed rules.
, - Monitoring job performance, establishing a fair and acceptable
performance target and develop a reward system that is higher than
the acceptable level
- Employees as ‘machines’
- The idea is that people are motivated by financial gain.
- Ford
- inspired by Taylor
- mass production (assembly line)
- standardized products
- low costs
- strong division of labor
- standard salary, enough to be able to buy products
- paternalistic (education, homes, healthcare)
- Weber
He emphasized the importance of administration based on expertise (rules experts)
and administration based on discipline (rules of officials).
- Bureaucracy
- Characteristics by Stewart:
- Specialization (of the function, not the employee), division of labor
- Advantage: Efficiency will increase through specialization
- Hierarchy
- Advantage: A clear chain of command will develop from the
highest to the lowest level of an organization
- Formal selection
- Advantage: employees will be hired and promoted based on
merit and expertise benefits both them and employer
- Career orientation
- Advantage: The hiring of “career” professionals will ensure the
performance of assigned duties without regard for extraneous
pressures
- System of rules and regulations
- Advantage: Efficiency will increase as formal rules and other
controls relating to employee performance are enforced
- Impersonality
- Advantage: When rules and other controls are applied
impersonally and uniformly, involvement with personalities and
personal preferences is avoided. Subordinates are therefore
protected from arbitrary actions of their superiors
Criticism
In general:
The classical approach ignores the psychical and social processes of employees
- limits the psychological growth of the employee
- boredom (need for variety)
- limited development and use of skills
- limited participation
- limited freedom to determine your own working methods, …
- inflexibility
, - rules must be followed obediently
- ignores the external environment of the organization
Taylor:
- strong division of labor (deskilling)
- little or no opportunity for employees to exercise control over their work
Despite the criticism, the standardization aspect of Taylorism is ‘alive’ in some places, such
as hotels having strict guidelines and the structure of McDonald’s.
Weber:
- The over-emphasis of rules and other controls may become “ends” rather than
“means”
- Lack of appreciation or concern for changed conditions
- Officials may develop a dependence upon bureaucratic status, symbols, and rules
- Delegation of authority to lower levels may encourage an emphasis on
subunit rather than overall goals → subunit conflict and decreased
effectiveness
- ‘Working to the rules’ may lead to feelings of failure and frustrations
Traditional Approach to Motivation and Control
Human Relations Approach
Explains the informal relations among employers and employees are concerned with moral
and psychological rather than legal aspects of an organization.
‘Humanizing the work organization’
- focus on employee as an individual
- analyzing what motives employees
Mayo: The Hawthrone experiments
In a study on increasing employee productivity, it was found that productivity was mainly
increased by the presence of the researchers. Employees wanted to do their best under the
watchful eye of a researcher because of the attention and being part of a study (Hawthrone
effect). This effect makes it clear that a manager’s behavior or leadership style can influence
the performance of employees. This resulted in a Human Relations movement that very
specifically tried to increase employee productivity by training managers to deal with their
employees.
- worker output + satisfaction related to social factors (e.g. treatment of employees)
Attention to:
, - the informal structure within organizations
- leadership, motivation, communication
- the needs of the employees
- groups within the organization
→ The idea is that employees aren’t just motivated by money
Human Relations Approach to Motivation and Control
Criticism
Scientific quality: the methodological value of the Hawthrone studies
Satisfied employee → productive employee
Ignores the organization and the context of the organization
‘People without organizations’
Systems Approach
Organizations as an Open System
In open organizations, the
organization takes in
resources from its external
environment and processes
or converts them into goods
and services that are sent
back to that environment,
where customers can buy
them.
The organizational procedure
is a code of conduct or routine
that an employee follows in
order to perform a task most
effectively.
Challenge input stage: the challenge of developing a set of organizational behaviors or
procedures that allows employees to identify high-quality resources and purchase them ar
an affordable price.
Challenge conversion stage: developing a set of behaviors and procedures that results in
high-quality goods and services that are developed with the least possible costs.
