UGBA105: UGBA105:

Organizational BehaviorOrganizational Behavior

Fall 2006Fall 2006

Professor Jim LincolnProfessor Jim Lincoln

Walter A. Haas School of BusinessUniversity of California, Berkeley

Class Agenda for TodayClass Agenda for Today

1.1. Introduction to OBIntroduction to OB

2.2. Course mechanicsCourse mechanics

2. Overview of topics 2. Overview of topics

When organizations do well or When organizations do well or poorly, what is the poorly, what is the firstfirst

explanation that comes to mind?explanation that comes to mind?The CEO did it!The CEO did it!

Beware of attribution bias!Beware of attribution bias!– The tendency to attribute The tendency to attribute

causation/agency to the actions causation/agency to the actions of individuals of individuals

Organizational behavior teaches that Organizational behavior teaches that the effectiveness of people in the effectiveness of people in organizations depends on their organizations depends on their situation-specific relationships with situation-specific relationships with one another one another

Louis V. Gerstner, CEO of IBM, 1993-2002

Louis V. Gerstner, CEO of IBM, 1993-2002

What Is Organizational Behavior?

The Study of General/People ManagementThe Study of General/People Management

The study of behavior and attitudes of individuals or groups in organizations (Micro OB)

The study of structure and culture of org. in relation to their tasks and environments (Macro OB)

OB draws on all of social & OB draws on all of social & behavioral science…behavioral science…

• PsychologyPsychology

• SociologySociology

• EconomicsEconomics

• Political SciencePolitical Science

• AnthropologyAnthropology

• HistoryHistory

Even some engineering now and then…Even some engineering now and then…

Some OB journals Some OB journals • Practitioner-oriented:Practitioner-oriented:

– Academy of Management ExecutiveAcademy of Management Executive– Business HorizonsBusiness Horizons– California Management ReviewCalifornia Management Review– Harvard Business ReviewHarvard Business Review– Sloan Management ReviewSloan Management Review

• Scholar-oriented:Scholar-oriented:– Academy of Management JournalAcademy of Management Journal– Administrative Science QuarterlyAdministrative Science Quarterly– Journal of Applied PsychologyJournal of Applied Psychology– Organizational Behavior and Human Decision ProcessesOrganizational Behavior and Human Decision Processes– Organization ScienceOrganization Science– Strategic Management JournalStrategic Management Journal

Some OB GurusSome OB Gurus

• Warren BennisWarren Bennis• Peter DruckerPeter Drucker• Michael HammerMichael Hammer• Rosabeth KanterRosabeth Kanter• Raymond MilesRaymond Miles• Henry MintzbergHenry Mintzberg• Tom PetersTom Peters• Jeffrey PfefferJeffrey Pfeffer

Research methods in OB run the Research methods in OB run the social science gamutsocial science gamut

– Experiments (both lab and field)Experiments (both lab and field)

– SurveysSurveys

– EthnographiesEthnographies

– Archival Research (documents & records)Archival Research (documents & records)

How does OB differ from other How does OB differ from other fields of business education? fields of business education?

• Finance, economics, accountingFinance, economics, accounting

• MarketingMarketing

• Operations Operations

• StrategyStrategy

• Human resource managementHuman resource management

How does OB differ from HR? How does OB differ from HR?

• OB is a OB is a lineline, not a specialized , not a specialized staffstaff, responsibility, responsibility– Much OB management is CEO-level Much OB management is CEO-level

• Vision and cultureVision and culture

• Re-orgsRe-orgs

• OB is about principles, policies, & strategiesOB is about principles, policies, & strategies– HR is more about tools and implementationHR is more about tools and implementation

Why should business students study Why should business students study OB? OB?

• ManagersManagers– How to organize and motivate your employeesHow to organize and motivate your employees– How to initiate and manage changeHow to initiate and manage change

• EntrepreneursEntrepreneurs– You have the big idea, you have the venture You have the big idea, you have the venture

capital lined up. How do you organize and capital lined up. How do you organize and motivate your team? motivate your team?

Why should business students Why should business students study OB? study OB?

• ConsultantsConsultants– problem-solving toolproblem-solving tool– useful for case interviewsuseful for case interviews

• InvestorsInvestors– will that merger work?will that merger work?– will that reorganization actually add will that reorganization actually add

shareholder value? shareholder value? – is that CEO as competent as s/he thinks s/he is? is that CEO as competent as s/he thinks s/he is?

Why should business students study Why should business students study OB? OB?

• Issues critical to managing your career:Issues critical to managing your career:– understanding culture and person-job fitunderstanding culture and person-job fit– Getting and using power and influenceGetting and using power and influence– implementing your ideas and goalsimplementing your ideas and goals

Some criticisms of OBSome criticisms of OB

• Isn’t it obvious or common-sensical?Isn’t it obvious or common-sensical?

– Many things are “obvious” after-the-fact. Many things are “obvious” after-the-fact. Example:Example:

• The best form of organization is flat, flexible, & empowering The best form of organization is flat, flexible, & empowering

• The best form of organization depends on the context The best form of organization depends on the context (e.g., tasks, people, competition, technology, etc.) (e.g., tasks, people, competition, technology, etc.)

Beware of hindsight bias!Beware of hindsight bias!

Other criticismsOther criticisms

• OB might be important, but it’s an art, not a science

– i.e., can’t be systematically analyzed or taught

• Is only be learned by doing

• Maybe it’s religion… – There is an element of

preaching in OB

• OB may be important for maintaining an organization, but it is not strategic

• OB might be important, but it’s an art, not a science

– i.e., can’t be systematically analyzed or taught

• Is only be learned by doing

• Maybe it’s religion… – There is an element of

preaching in OB

• OB may be important for maintaining an organization, but it is not strategic

Tom Peters as bible- as bible-thumping evangelist.thumping evangelist. Tom Peters as bible- as bible-thumping evangelist.thumping evangelist.

OB OB isis strategic strategic

OB and HR are OB and HR are key to the development of key to the development of critical & hard-to-imitate capabilitiescritical & hard-to-imitate capabilities

• Such capabilities refer to an organization’s core skills and knowledge that give it sustainable competitive advantage: allow it to better serve customers and clients than the competition– Examples:Examples:

• Clear vision and strong cultureClear vision and strong culture• Motivated peopleMotivated people• Effective teams and networksEffective teams and networks

• Studies of IPOs among 200+ firms showed that Studies of IPOs among 200+ firms showed that people-centered practices were associated with people-centered practices were associated with faster time to IPO and higher survival rates.faster time to IPO and higher survival rates.

There is abundant evidence that people There is abundant evidence that people management is key to management is key to

competitive strategy and successcompetitive strategy and success

• Watson, Wyatt, an HR consulting firm, concluded Watson, Wyatt, an HR consulting firm, concluded that “Companies that link employee developmentthat “Companies that link employee development to business strategy have 40% higher total share-to business strategy have 40% higher total share- holder returns than companies that do not.”holder returns than companies that do not.”

“ “All organizations now routinely say, All organizations now routinely say, ‘ ‘People are our greatest asset.’ Yet fewPeople are our greatest asset.’ Yet few practice what they preach, let alone trulypractice what they preach, let alone truly believe it…”believe it…”

Peter F. Drucker (1909-2005)

Dilbert’s Perspective on HRM

    

““You got a problem with the You got a problem with the guy in the cubicle next to you? guy in the cubicle next to you?

I don’t care; shoot him”I don’t care; shoot him”

Marc Andreessen, Marc Andreessen, Co-founder of Co-founder of NetscapeNetscape

Marc Andreessen, Marc Andreessen, Co-founder of Co-founder of NetscapeNetscape

““In the new economy, competition isIn the new economy, competition isglobal, capital is abundant, ideas areglobal, capital is abundant, ideas aredeveloped quickly and cheaply, anddeveloped quickly and cheaply, andpeople are willing to change jobs often.people are willing to change jobs often.In that kind of environment…all thatIn that kind of environment…all thatmatters is talent…superior talent willmatters is talent…superior talent willbe tomorrow’s prime source of be tomorrow’s prime source of competitive advantage.” competitive advantage.”

E. Chambers et al. (1998). E. Chambers et al. (1998). ““The War for Talent.”The War for Talent.”The McKinsey Quarterly, The McKinsey Quarterly, 2-15.2-15.

The problem, then, is how to get, The problem, then, is how to get, keep, and utilize talented peoplekeep, and utilize talented people

• It is not just a question of payIt is not just a question of pay

• Even talented people must be Even talented people must be organized and led organized and led

“While analysts on Wall Street or GE's own investors view Welch's likely legacy as creating the world's most valuable company in stock market terms, Welch himself sees things quite differently.

The man who spends more than 50% of his time on people issues considers his greatest achievement the care and feeding of talent.

''This place runs by its great people,'' says Welch. ''The biggest accomplishment I've had is to find great people. An army of them. They are all better than most CEOs. They are big hitters, and they seem to thrive here.''

“He believes he has to know people well enough to trust them and their judgments. Welch knows by sight the names and responsibilities of at least the top 1,000 people at GE.”

“While analysts on Wall Street or GE's own investors view Welch's likely legacy as creating the world's most valuable company in stock market terms, Welch himself sees things quite differently.

The man who spends more than 50% of his time on people issues considers his greatest achievement the care and feeding of talent.

''This place runs by its great people,'' says Welch. ''The biggest accomplishment I've had is to find great people. An army of them. They are all better than most CEOs. They are big hitters, and they seem to thrive here.''

“He believes he has to know people well enough to trust them and their judgments. Welch knows by sight the names and responsibilities of at least the top 1,000 people at GE.” “How Jack Welch runs GE.”

Business Week, May 29, 1998.

“How Jack Welch runs GE.” Business Week, May 29, 1998.

Jack Welch as hands-on manager of talentJack Welch as hands-on manager of talent

John F. Welch, Jr.GE Chairman & CEO, 1981 to 2001

John F. Welch, Jr.GE Chairman & CEO, 1981 to 2001

And some organizations get excellent And some organizations get excellent results with merely “OK” peopleresults with merely “OK” people

See C. A. O'Reilly III and J. Pfeffer: See C. A. O'Reilly III and J. Pfeffer: Hidden Value: How Great Companies Achieve Extraordinary Results With Ordinary People. . Harvard Business School Press, 2000.Harvard Business School Press, 2000.

See C. A. O'Reilly III and J. Pfeffer: See C. A. O'Reilly III and J. Pfeffer: Hidden Value: How Great Companies Achieve Extraordinary Results With Ordinary People. . Harvard Business School Press, 2000.Harvard Business School Press, 2000.

Only 10% of people are in the top 10%. Great companies not only hire talent, they build it and unleash the energy and talent of all their people.

Only 10% of people are in the top 10%. Great companies not only hire talent, they build it and unleash the energy and talent of all their people.

So how do they do it? So how do they do it?

WWhat hat isis the (general) manager’s job? the (general) manager’s job? (Kotter, 1996; Mintzberg, 1973; ) (Kotter, 1996; Mintzberg, 1973; ) ““No job is more vital to our society than No job is more vital to our society than that of the manager” that of the manager” (Mintzberg, 1975)”(Mintzberg, 1975)”

Management is Management is Janus-faced:-faced:

Manager as engineer: Manager as engineer: trained technician who trained technician who uses a professional uses a professional body of knowledge to body of knowledge to create formal systems create formal systems that plot strategy, that plot strategy, make decisions, incent make decisions, incent people, and coordinate people, and coordinate units in maximally units in maximally efficient ways.efficient ways.

Manager as leaderManager as leader: : individual who leverages individual who leverages highly personal resources highly personal resources (energy, stamina, charisma, (energy, stamina, charisma, vision, warmth, charm, vision, warmth, charm, gregariousness, toughness, gregariousness, toughness, daring, know-how) to daring, know-how) to inspire, empower, and inspire, empower, and channel the actions of others.channel the actions of others.

Janus: The Roman God of doorways

Janus: The Roman God of doorways

The historical thrust of management The historical thrust of management science and education has been to:science and education has been to:

Develop formal Develop formal systems and tools systems and tools

that relieve that relieve managers of the managers of the personal work of personal work of

leadingleading

The structure of the course reflects this The structure of the course reflects this dichotomydichotomy

Sections on Sections on organization design organization design & incentive & incentive systems represent systems represent the the engineeringengineering perspectiveperspective

Sections on Sections on culture, culture, leadership, leadership, networks, & networks, & power power represent the represent the leadershipleadership perspectiveperspective

How has the manager’s role How has the manager’s role changed in the new economy?changed in the new economy?

Less a boss , more a coach, cheerleader, Less a boss , more a coach, cheerleader, politician, politician, networker, hustler networker, hustler

--More a leader, less an engineer --More a leader, less an engineer

--More an entrepreneur, --More an entrepreneur,

less a bureaucratless a bureaucrat

Let’s get to down to Let’s get to down to business …business …

So now that you’re psyched …So now that you’re psyched …

Reader and WebsiteReader and Website

• Electronic Electronic Course reader available thru available thru Catalyst• Course Website ((login=ba105, pw=organizelogin=ba105, pw=organize))

– Instructor infoInstructor info– SyllabusSyllabus– Supplementary readings Supplementary readings – Useful linksUseful links– Course announcementsCourse announcements– Lecture powerpoints Lecture powerpoints

• Posted on the website the day before the classPosted on the website the day before the class– Discussion section businessDiscussion section business

Class meetingsClass meetings

• Thursday: Thursday: – Introduce a new topic Introduce a new topic – Lecture/discussionLecture/discussion

• Tuesday (GSI’s Jennifer Kurkoski & Nydia MacGregor)Tuesday (GSI’s Jennifer Kurkoski & Nydia MacGregor)– Class businessClass business– Review of lecture and readingsReview of lecture and readings– Case analysisCase analysis– Videos & exercisesVideos & exercises– Team project discussionsTeam project discussions

Other course businessOther course business• Enrollment issuesEnrollment issues

– Go to the Go to the Undergraduate Program Office (S450)(S450)– This course uses instructor drop: This course uses instructor drop:

• If you do not attend the section in which you are registered in the first two weeks you may If you do not attend the section in which you are registered in the first two weeks you may be dropped from enrollment.be dropped from enrollment.

– SORRY- NO SECTION SWITCHINGSORRY- NO SECTION SWITCHING

• Arrival and attendanceArrival and attendance– Class attendance is important (roll taken in sections) Class attendance is important (roll taken in sections) – Arrive Thursday by 8:10AM. Late arrivals use rear door.Arrive Thursday by 8:10AM. Late arrivals use rear door.

• Email (contact GSI’s first; use your full name)Email (contact GSI’s first; use your full name)

• Face cards & name tents (see website Face cards & name tents (see website announcements))

• Class reps

Course RequirementsCourse Requirements• Class participation (15%)Class participation (15%)

– In-class discussions, particularly of casesIn-class discussions, particularly of cases– Oral presentation on team projectsOral presentation on team projects– Team member ratingsTeam member ratings

• Midterm and final exams (50%)Midterm and final exams (50%)– Take home essay exam (analysis of a case)Take home essay exam (analysis of a case)– Objective (true-false/multiple choice) in-class examObjective (true-false/multiple choice) in-class exam

• SORRY– NO CHANGE IN MIDTERM OR FINAL EXAM TIMESSORRY– NO CHANGE IN MIDTERM OR FINAL EXAM TIMES

• Team project (30%)Team project (30%) – You will be assigned to teams of 4-5 persons eachYou will be assigned to teams of 4-5 persons each– You will study OB problems/issues in a real organization You will study OB problems/issues in a real organization – Oral presentation and paper (12-15 pages)Oral presentation and paper (12-15 pages)

• In general, all members will receive the same gradeIn general, all members will receive the same grade

• Participation in research experiments (5%)Participation in research experiments (5%)

Course overview….Course overview….

Schedule of topicsSchedule of topics

Part 1: Introduction (1 week)Part 1: Introduction (1 week)An introduction to course themesAn introduction to course themesThe manager’s job and the congruence perspectiveThe manager’s job and the congruence perspective

Part 2: The (semi-) hard stuff: formal org (2 weeks)Part 2: The (semi-) hard stuff: formal org (2 weeks)Strategic grouping, coordination and authority, designing and Strategic grouping, coordination and authority, designing and

managing teamsmanaging teams

Part 3: The soft stuff: informal organization I (2 weeks)Part 3: The soft stuff: informal organization I (2 weeks)Leadership and culture Leadership and culture

Course overviewCourse overview

Part 4: Soft/hard and micro: Motivation, incentives, Part 4: Soft/hard and micro: Motivation, incentives, and decision-making (3 weeks)and decision-making (3 weeks)

Part 5: Informal organization II (1 weeks)Part 5: Informal organization II (1 weeks)Politics and networksPolitics and networks

Part 6: Managing diversity at home and abroad Part 6: Managing diversity at home and abroad

(2 weeks)(2 weeks)

Next Tuesday discussion sessionNext Tuesday discussion session

• Introduction to discussion sectionIntroduction to discussion section• Read and prepare to discuss:Read and prepare to discuss:

– What general managers doWhat general managers do• Read Kotter articleRead Kotter article

– The congruence model as a framework for The congruence model as a framework for organizational problem-solvingorganizational problem-solving

• Read Nadler and Tushman chapterRead Nadler and Tushman chapter