Chapter 1: A Strategic Approach to Organisational Behaviour
The base for the system of discretion and accountability is a core, set of workplace beliefs:
1. work should be fulfilling
2. workplaces should be fearless and energised
3. leaders should serve followers
4. employees should be treated like customers
5. people should not be afraid to make mistakes
6. work and family life should be balanced
- leadership of these companies believe that valuing people is crucial for business success
• get more out of employees by providing them with power and autonomy
Organisational behaviour - the actions of individuals and groups in an organisational
context
Managing organisational behaviour - actions focused on acquiring, developing and
applying the knowledge and skills of people
Strategic organisational behaviour - an approach that involves organising and managing
people’s knowledge and skills effectively to implement the organisation’s strategy and
gain a competitive advantage
- individual and interpersonal factors such as the ability to learn, self-manage, technical
skills, personality and values are important
- managers invest effort into shaping the internal norms and practices of the organisation
- senior managers help middle managers resolve conflict, mismanagement, negotiation
and motivation
- senior managers referred to as strategic leaders
Productivity - the output of individuals and groups
Satisfaction - the feelings that individuals and groups have about their work
Organisational success - competitive advantage and financial performance
1
,Associates - the workers who carry out the basic tasks
- skills such as teaching, listening, understanding people and managing stress are
important for preforming coaching activities with associates
- lower-level managers also remove obstacles for associates and deal with personal
problems that affect their work
- they are more effective when the know the organisations strategy and have a long-term
view
- studies have found that business education has positive effects on these important skills
including interpersonal skills of leadership
“there is no substitute for experience”
Foundations of a strategic approach to OB:
- it integrates knowledge from all of the areas of understanding behaviour in
organisations
- focuses on behaviours and processes that help create competitive advantaged and
financial success
Points of Study:
1. Common sense alone does not equip the manager with sufficient
understanding of how to leverage human capabilities
2. A working knowledge of OB helps managers gain
the confidence required to empower associates and work with them
to find creative solutions to problems that arise
3. The strategic approach to OB integrates important behavioural
science knowledge within an organisational setting and emphasises
application
2
, Features of an organisation:
- network of individuals
- system
- coordinated activities
- division of labour
- goal orientation
- continuity over time
Organisation - a collection of individuals forming a coordinated system of specialised
activities for the purpose of achieving certain goals over an extended period of time
- eg. Apple’s innovations are due to the quality associates working in design, its
innovation culture, and the way managers lead by empowering the associates to be
creative and develop innovations
- prominent type of organisation is a business organisation (eg. Nestle) but other types
occur as well such as the public-sector organisations (eg. Gemente)
The nature of human capital:
- resource base includes tangible and intangible resources
Tangible Resources Intangible Resources
factories reputation
equipment trust between employees
inventory skills of associates
property culture and norms
/ relationships with suppliers and buyers
/ brand name
Human capital - critical intangible resource, the sum of the skills, knowledge and general
attire utes of the people in an organisation
- does not suffer from the law of diminishing returns —> does not depreciate it’s value
as it is being used
“Burn down my buildings and give me my people, and we will rebuild the company in a
year. But leave my buildings and take away my people and I’ll have a real problem.”
Human capital as a source of competitive advantage:
Competitive advantage - results when an organisation can perform some aspect of its
work better than competitors can or when it cannot be duplicated
3
, Human capital value - extent to which individuals are capable of producing work that
supports an organisation’s strategy for competing in the marketplace
- plays important role in development and implementation of the company strategies
- managers must expend considerable effort to acquire quality human capital and
demonstrate to the firm’s external constituencies its value
Human capital rareness - extent to which the skills and talents of employees is unique in
the industry
- eg. corporate lawyers with relatively rare abilities to reduce the tensions of disgruntled
consumers
Human capital imitability - extent to which the skills and talents of an organisations
people can be copied by other organisations
- skills and talents most difficult to imitate are usually those that are complex and learned
inside a particular organisation
Tacit knowledge - type of knowledge that people have but cannot articulate
Positive organisational behaviour - an approach to managing people that nurtures each
individual’s greatest strengths and helps people use them to their and the organisations
advantage
- people are healthier and more productive if they have a strong self-efficacy with regards
to work
- individuals who are managed in a positive manner and who take a personally positive
approach to outperform the other candidates often are healthier mentally and physically
- providing this kind of leadership requires the application of emotional intelligence
High involvement management - carefully selecting and training associates and giving
them decision-making power, information and incentive compensation
- combining decision power and information sharing provides associate with the ability
to make their own decisions about how to do tasks and solve problems
4
The base for the system of discretion and accountability is a core, set of workplace beliefs:
1. work should be fulfilling
2. workplaces should be fearless and energised
3. leaders should serve followers
4. employees should be treated like customers
5. people should not be afraid to make mistakes
6. work and family life should be balanced
- leadership of these companies believe that valuing people is crucial for business success
• get more out of employees by providing them with power and autonomy
Organisational behaviour - the actions of individuals and groups in an organisational
context
Managing organisational behaviour - actions focused on acquiring, developing and
applying the knowledge and skills of people
Strategic organisational behaviour - an approach that involves organising and managing
people’s knowledge and skills effectively to implement the organisation’s strategy and
gain a competitive advantage
- individual and interpersonal factors such as the ability to learn, self-manage, technical
skills, personality and values are important
- managers invest effort into shaping the internal norms and practices of the organisation
- senior managers help middle managers resolve conflict, mismanagement, negotiation
and motivation
- senior managers referred to as strategic leaders
Productivity - the output of individuals and groups
Satisfaction - the feelings that individuals and groups have about their work
Organisational success - competitive advantage and financial performance
1
,Associates - the workers who carry out the basic tasks
- skills such as teaching, listening, understanding people and managing stress are
important for preforming coaching activities with associates
- lower-level managers also remove obstacles for associates and deal with personal
problems that affect their work
- they are more effective when the know the organisations strategy and have a long-term
view
- studies have found that business education has positive effects on these important skills
including interpersonal skills of leadership
“there is no substitute for experience”
Foundations of a strategic approach to OB:
- it integrates knowledge from all of the areas of understanding behaviour in
organisations
- focuses on behaviours and processes that help create competitive advantaged and
financial success
Points of Study:
1. Common sense alone does not equip the manager with sufficient
understanding of how to leverage human capabilities
2. A working knowledge of OB helps managers gain
the confidence required to empower associates and work with them
to find creative solutions to problems that arise
3. The strategic approach to OB integrates important behavioural
science knowledge within an organisational setting and emphasises
application
2
, Features of an organisation:
- network of individuals
- system
- coordinated activities
- division of labour
- goal orientation
- continuity over time
Organisation - a collection of individuals forming a coordinated system of specialised
activities for the purpose of achieving certain goals over an extended period of time
- eg. Apple’s innovations are due to the quality associates working in design, its
innovation culture, and the way managers lead by empowering the associates to be
creative and develop innovations
- prominent type of organisation is a business organisation (eg. Nestle) but other types
occur as well such as the public-sector organisations (eg. Gemente)
The nature of human capital:
- resource base includes tangible and intangible resources
Tangible Resources Intangible Resources
factories reputation
equipment trust between employees
inventory skills of associates
property culture and norms
/ relationships with suppliers and buyers
/ brand name
Human capital - critical intangible resource, the sum of the skills, knowledge and general
attire utes of the people in an organisation
- does not suffer from the law of diminishing returns —> does not depreciate it’s value
as it is being used
“Burn down my buildings and give me my people, and we will rebuild the company in a
year. But leave my buildings and take away my people and I’ll have a real problem.”
Human capital as a source of competitive advantage:
Competitive advantage - results when an organisation can perform some aspect of its
work better than competitors can or when it cannot be duplicated
3
, Human capital value - extent to which individuals are capable of producing work that
supports an organisation’s strategy for competing in the marketplace
- plays important role in development and implementation of the company strategies
- managers must expend considerable effort to acquire quality human capital and
demonstrate to the firm’s external constituencies its value
Human capital rareness - extent to which the skills and talents of employees is unique in
the industry
- eg. corporate lawyers with relatively rare abilities to reduce the tensions of disgruntled
consumers
Human capital imitability - extent to which the skills and talents of an organisations
people can be copied by other organisations
- skills and talents most difficult to imitate are usually those that are complex and learned
inside a particular organisation
Tacit knowledge - type of knowledge that people have but cannot articulate
Positive organisational behaviour - an approach to managing people that nurtures each
individual’s greatest strengths and helps people use them to their and the organisations
advantage
- people are healthier and more productive if they have a strong self-efficacy with regards
to work
- individuals who are managed in a positive manner and who take a personally positive
approach to outperform the other candidates often are healthier mentally and physically
- providing this kind of leadership requires the application of emotional intelligence
High involvement management - carefully selecting and training associates and giving
them decision-making power, information and incentive compensation
- combining decision power and information sharing provides associate with the ability
to make their own decisions about how to do tasks and solve problems
4
