BUS209 Study Guide
Unit 1: Organizations in Business
1a. Define organizational behavior (OB) and relate it to an organization's success
- What is organizational behavior?
- What are the traditional behavioral sciences, and how are they used in studies about how organizations behave?
- What is employee engagement?
- What OB issue can be addressed by each of these forms of study?
It's important to understand what organizational behavior is, and your understanding begins with your ability to define it. Organizational behavior is the study of people in a business and how that behavior affects company performance. Are you comfortable with stating what organizational behavior is? Can you demonstrate how our understanding of organizational behavior draws on other established behavioral sciences and why that is important in evaluating current studies of OB?
When studying any organization, we need to understand its structure. Think of the classic representation of an organization, which details the various levels, such as president, vice presidents, directors, and so on down the ranks. Much of our discussion on OB will involve looking at these various levels and understanding how they influence and impact those above and/or below.
Find some examples of different organizational structures. Don't just look at public, for-profit firms, but also consider private and not-for-profit organizations. What organizational structure you would like to be a part of? Why do you feel that way? Now that you are looking at some companies, ask yourself why an understanding of OB matters. Firms spend a great deal of time and resources on this topic. Can you list some reasons why this understanding is important? If you were about to invest your time and money to launch a new business, are there some OB ideas you would want to include as you build the business?
There are a few points made in this unit that you should review:
- "People are definitely a company's greatest asset. It doesn't make any difference whether the product is a car or cosmetics. A company is only as good as the people it keeps." – Mary Kay Ash, founder of Mary Kay, Inc.
- In its 2007 Job Outlook Survey, the National Association of Colleges and Employers (NACE) noted that employers sought these skills more than any others:
- Communication skills (verbal and written)
- Honesty/integrity
- Interpersonal skills (being able to relate well with others)
- Motivation/initiative
- Strong work ethic
- In terms of OB, healthy organizations exhibit role clarity, information sharing, and performance feedback. In these terms, 50% of business organizations today are "unhealthy".
We have discussed the importance of studying OB for your benefit, your employer's, and the organization's. But how do we go about conducting these studies? As a consumer of thousands of products, you realize that the companies involved constantly conduct studies to determine what you want, need, and are willing to pay for their products or services. Well, we are interested in conducting studies to understand more about how organizations work, what can increase their effectiveness, what contributes to a more productive workforce, and any additional factors that can help improve the health of our organization.
The more we know about OB, the better managers and leaders we can become. Let's assume that you are stepping into a new role as an executive of a local company. What specific behaviors would you like to see in this organization that could help you succeed?
Over the years, there has been a great deal of discussion on the importance of employee engagement – an employee's emotional commitment to their work and organization – as a determinant of firm success. The higher the level of employee engagement, the higher the level of customer satisfaction, employee satisfaction, and financial return. Take a moment and think about when you were really happy with a job and when you were not so happy. What were some of the factors that contributed to how you felt in each of those situations?
To review, see:
1b. Identify current trends in organizational behavior
- How has technology affected businesses over the last five years?
- Is technology ever a disadvantage for a business? If so, how?
- What is the definition of sustainability, and provide an example of how this has been integrated into a business?
- What does the term going green mean to you? List a few companies following this program and provide examples from their product/service offerings.
- List some benefits and concerns that Baby Boomers bring into your company, and do the same for Millennials. If this was your company, what would you do to emphasize the benefits and reduce the conflicts?
Everyone can see the effects of technology on business. Rapid technological changes have affected how we communicate internally and externally, produce goods/services, and reach domestic and foreign markets.
In the past, technology was considered an entry barrier against competition. In other words, companies that invested heavily in various forms of technology made it more difficult for competitors to enter their markets. Now, this barrier has been lowered or eliminated. See if you can identify three examples of firms that created a barrier to entry for their competitors in the past few decades. Now, identify at least three new forms of technology that have made it easier for new companies (start-ups) to enter markets. How can a company benefit from their use of this technology?
Environmental protection regulations influence the business community, which is reflected in products and services that support the ideas of sustainability – the practice of meeting present needs without compromising future generations' resources – and "going green".
One topic that has generated a large amount of research and discussion is the clash in cultures between the Baby Boomer generation (those born between 1946 and 1964) and the Millennial generation (those born between 1981 and 1996). It is important to consider company culture – the shared values, beliefs, and behaviors that shape how people work together – as it represents the organization's attitudes and what it stands for. The differences in generations can be a huge benefit to firms and/or a source of conflict.
We are now participants in a truly global economy. The good news is that you can access more markets and customers than ever. The bad news is that you are faced with more competition than ever. This needs to be a part of any business' strategic plan. There is plenty of discussion about outsourcing, both positive and negative. Outsourcing occurs when a company uses a third party for services, products, or even the work employees do. No discussion of the global economy would be complete without some reference to offshoring. How would you define this activity? Discuss how you feel about these two activities. Would you consider them to be beneficial to the firm? What about the company's employees? Are there any ethical issues you can identify with these practices?
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1c. Discuss globalization, cross-cultural challenges, and benefits of diversity in the workplace
- How would you define diversity?
- What are the benefits that come from a diversified organization?
- As a business executive, what would you do to encourage diversity in your company?
- What steps might you take to ensure that everyone in your company sees the benefits of diversity and integrates diversity into the company culture?
No discussion on OB can take place without including the issue of a diverse workforce, customer base, or management team. Companies today recognize the benefits they can realize from having a culture that supports diversity – the inclusion and empowerment of people with different backgrounds, characteristics, and perspectives. In a corporate context, diversity extends to varied perspectives, experiences, and skills individuals bring to the workplace. In a corporate context, diversity extends to varied perspectives, experiences, and skills individuals bring to the workplace. However, it is not always so easy to achieve diversity. There are several benefits to diversity for a business. These include increased creativity, better customer service, improved employee satisfaction, better financial performance, and lower legal costs. Create a chart that provides examples of these benefits, using research on different companies.
As you can see from your readings and research, diversity has real benefits for business in many ways. However, recognizing the benefits and actually achieving diversity are two very different topics. Diversity will not just occur in the normal conduct of business but result from an organization's leaders being proactive in pursuing a truly diverse firm.
Globalization is a catch-all term that describes the increasing interconnectedness and interdependence of the world's economies, cultures, and populations, driven by advances in transportation, communication, and technology. A global marketplace can affect any business in any country. Part of improving our understanding of the issue is to recognize that the world is made up of many cultures that are quite different.
Review the definitions of individualism, collectivism, power distances, uncertainty avoidance, masculinity, and femininity in this list.
- Individualism: Cultures where people define themselves as individuals and form looser ties with their groups
- Includes countries like the United States, Australia, the United Kingdom, Canada, and Hungary
- Collectivism: Cultures where people have stronger bonds to their groups and group membership forms a person's self-identity
- Includes countries like Guatemala, Ecuador, Indonesia, Pakistan, and China
- Low Power Distance: A society that views an unequal distribution of power as relatively unacceptable
- Includes countries like Austria, Denmark, Israel, Ireland, and New Zealand
- High Power Distance: A society that views an unequal distribution of power as relatively acceptable
- Includes countries like Malaysia, Slovakia, the Philippines, Russia, and Mexico
- Low Uncertainty Avoidance: Cultures in which people are comfortable in unpredictable situations and have a high tolerance for ambiguity
- Includes countries like Denmark, Jamaica, Singapore, China, and Sweden
- High Uncertainty Avoidance: Cultures in which people prefer predictable situations and have low tolerance for ambiguity
- Includes countries like Belgium, El Salvador, Greece, Guatemala, and Portugal
- Masculinity: Cultures in which people value achievement and competitiveness, as well as the acquisition of money and other material objects
- Includes countries like Slovakia, Japan, Hungary, Austria, and Venezuela
- Femininity: Cultures in which people value maintaining good relationships, caring for the weak, and quality of life
- Includes countries like Norway, the Netherlands, Sweden, Costa Rica, and Chile
If you have traveled in any foreign countries, can you recall any instances when you observed these differences? If you haven't traveled outside your home country, research this topic to feel comfortable with the issue. Now that you have appreciated some of the existing cross-cultural challenges, can you discuss how you would address these challenges in your company?
Many companies today, both large and small, are conducting business around the globe. If your company is going to have a dynamic, positive, and effective global strategy, you will need specific plans for addressing cultural diversity. Hofstede's Cultural Framework provides a very interesting way to compare cultural attributes.
To review, see:
Unit 1 Vocabulary
This vocabulary list includes terms you will need to know to successfully complete the final exam.
- Baby Boomer generation
- collectivism
- diversity
- employee engagement
- femininity
- globalization
- high power distance
- high uncertainty avoidance
- individualism
- interpersonal skills
- low power distance
- low uncertainty avoidance
- masculinity
- Millennial generation
- organizational behavior
- outsourcing
- sustainability