Beliefs is a Psychological Process

Beliefs refers to descriptive thoughts that an individual holds about something which influences the individual behavior. It is normally based on knowledge opinion and faith and are acquired from parents, teacher, friends etc. Beliefs tends to be stable as they served as foundation upon which individual order and structure are built. It provides continuity and meaning to perception. The values can be developed from cultural environment and functional factors. The divergence of belief from real situation can limit their effectiveness. The divergence occurs from superstitions, delusions, prejudices etc. 

Belief is a psychological process which is an increasingly important issue in today’s organizations. It is a positive expectation that another will not act opportunistically. In other words, beliefs refer to perception and attitudes towards objects develop through cognitive process or feeling that has developed from the past experience and learning. Belief is a history dependent process based on relevant but limited samples of experience. It takes time to form, building incrementally and accumulating. Most of us find it hard to belief someone immediately if we don’t know anything about them. At the extreme, in the case of total ignorance, we can gamble but we can’t belief. But as we get to know someone, and the relationship matures, we gain confidence in our ability to make a positive expectation.

Belief is another important factor causing individual behavior different. Belief can be based on knowledge, opinion and faith. They are acquired from parents, teachers, peer and reference group member etc. It provides continuity to the personality of an individual. They assign meaning to his/her day-to-day perceptions and activities and serve in his/her attempted solution of varied goals. An individual's beliefs also exert a vital impact on his motivation in two ways.
  • He/she must believe that he is capable of performing the acts, which the organization expects of him/her. 
  • He/she must believe that performance of acts desired by the organization will have positive outcomes for him/her personally.

There are five key dimensions that underline the concept of belief: integrity, competence, consistency, loyalty and openness.
Key Dimensions of Belief
  1. Integrity: Integrity refers to honesty and truthfulness. Of all five dimensions, this one seems to be most critical when someone assesses another’s trustworthiness.
  2. Competence: Competence encompasses an individual technical and interpersonal knowledge and skills. You need to belief that the person has the skills and abilities to carry out what he or she says they will do.
  3. Consistency: Consistency relates to an individual’s reliability, predictability and good judgment in handling situations. Inconsistencies between words and action decrease trust or belief. This dimension is particularly relevant for managers.
  4. Loyalty: Loyalty is the willingness to protect and save face for another person. Belief requires that you can depend on someone not to act opportunistically.
  5. Openness: The final dimension of belief is openness. Can you rely on the person to give you the full truth?

The importance of beliefs in OB are:
  1. It provides continuity to the personality of an individual.
  2. It assigns meaning to perception of an individual.
  3. Beliefs are incorporated with attitudes.
  4. It helps to motivate an individual.

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Better Decision Comes from Understanding Emotional and Physiological Responses: Mental Process

Mental Process

Better decisions come from understanding how emotional and physiological responses brought about by the environmental conditions we are experiencing govern out thought processes. Emotions and reactions can override our attempts to be rational. On the other hand, people have the amazing capacity of directing their attention and taking their control of their impulsive nature when they realize that the expenditure is worth the effort. Part of being a human decision maker is realizing that biological and cognitive factors have a continual and often unnoticed influence on how we solve problems.

The mental / cognitive process, or emotions or reaction are known as the outcomes of the state of brain or mind. Recent research aided by technological advancements such as brain imaging has improved our understanding of how bio-chemical processes influence the brain’s ability to make decisions. The brain is made of tens of billions of nerve cells, called neurons, which are highly interconnected. The neurons of the brain interact electro-chemically with each other and with distant body cells through an extremely complex system of tubular extensions that send and receive messages. Through this chemical connection, any given neuron is only a few neurons away from the cells in the body, and this highly interconnected of neurons is recognized as the principal agent of what we call cognition or thinking.

Information is passed along this intricate highway by more than chemical molecules (for example, amino acids, monoamines and peptides), which are called neurotransmitters. Many of these neurotransmitters play a very important role in moderating our emotional states and our problem recognizing and solving ability. The sound mental/ cognitive system plays important role in problem recognizing and solving.

When recognizing and solving problems, things that are novel, high-contrast, unusual, or emotional seize our attention. The sound cognitive system helps in developing sound cognitive or mental process which is very important in problem recognition. The level of cognitive power is different in the different people. It made up with input (internal as well as external), structure of physiological process and types of psychological factors. Under cognitive process, information coming from the sense or sense organs is transformed, reduced, elaborated, recovered and used. The cognitive process is thus the mental process involved in knowing about the concepts such as thinking, reasoning, problem solving, perception, conceptualization, judgment, creativity etc. In other words, cognition refers to the processing of the information about the environment that is received through the sense.

The steps of mental / cognitive process are as follows:
  1. The reception and selection of information
  2. The making of alternation in the selected information
  3. The association of items of information with each other
  4. The elaboration of information in thought
  5. The storage of information in memory
  6. The retrieval of stored information

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Understanding Individual Behavior in an Organization

Understanding Individual Behavior

There are millions of stars in the sky, but every star is different. Similarly, there are millions of people in the universe, but each person is different from the multiple perspectives. Organizations are composed of individuals. Each individual is different from each other on the basis of different psychological factors such as motives, aspirations, perceptions and abilities.

Individual behavior means some concrete actions by a person. For instance, how a teacher behaves in the class reflects his behavior. Organizational behavior has a great challenge as well as responsibility to deal with the difference in individual behavior in the context of organizations.

Psychology, a discipline contributing to organizational behavior, helps to examine how people are similar, and how they differ in their thinking, feeling, and behaviors. The behavior of an individual is influenced by various factors. Some of the factors lie within himself e.g. his instincts, personality traits, internal feelings etc. while some lie outside him comprising the external environment of which he is a part, e.g. weather conditions, events conveying some information, and other people’s behavior that directly influences his behavior.

Factors Influencing Individual Behavior

Many characteristics of individual behavior (or human beings) are inherited and many others are formed because of various environmental factors. Individual behavior is influenced by personal factor, psychological factor, organizational factors and environmental factors.

1. Personal Factors

Every individual brings to the work place a variety of personal characteristics and attributes like age, sex, education, intelligence, marital status, religion and number of dependents etc.

i) Age

Age is an important factor that organizations are concern about. Age has an impact on the performance, turnover, absenteeism, productivity and satisfaction levels of employees. In the other simple words, performance depends on age. As age advances, performance is likely to decline. Similarly, aging has impact on turnover. The older people are less likely to quit the job. Age-absence relationship depends on whether absenteeism is avoidable or unavoidable. Generally, older employees have lower rate of avoidable absence than the younger employees. However, they have high rate of unavoidable absence. This probably because of poor health associated with old age. With regard to productivity, older age results in reduced productivity. This is because of the decline in individual’s skills as he grows older in age. This is a positive association between age and satisfaction.

ii) Gender (Sex)

There are important differences between men and women which is because of their inherent qualities and family responsibilities that affect their job performance. Man is expected to be tough while a woman is expected to be gentle and highly emotional, are some of the stereotyped assumption that have no basis in genetic influences. These behaviors are developed due to differences in treatment that the boys and girls receive in the family environment.

Psychological studies have found that women are more willing to conform to authority and less aggressive. On the other hand, men are more aggressive, have more expectations, and are more ambitious than women. While the stability rate is higher among women employees, the absenteeism rate is also higher; this can be attributed to the fact that they are expected to shoulder more family responsibilities than men. Research studies on male and female employees say that there are no consistent male-female difference in problem-solving ability, analytical skills and competitive drive.

Even though some work roles are assumed to be the exclusive domain of modified to accommodate man in these positions. As far as the administration of the management process is concerned, women, in general do not differ from men in their operative behaviors.

iii. Emotional Intelligence

Highly intelligent employees learn job-related skills and other organizational practices quickly, and organizations have to spend less time for training them. People with high intelligence have a good decision-making ability because of their good analytical and reasoning skills. They are very productive and have a high achievement drive. This is the age of emotional intelligence, and today’s recruiting managers make sure that candidates have it. The five components of emotional intelligence at work are:
  • Self-awareness: Self-confidence, realistic self-assessment and self-deprecating sense of humor.
  • Self-regulation: Trust worthiness and integrity, comfort with ambiguity and openness to change.
  • Motivation: A strong drive to achieve, even in the time of failure, and organizational commitment.
  • Empathy: Expertise in building and retaining talent, cross-cultural sensitivity and service to clients and customers.
  • Social Skills: Effectiveness in leading change, persuasiveness and expertise in building and leading teams.

iv) Marital Status

Marital status has influence on absenteeism, turn over and satisfaction. Married employees have fewer absences, undergo less turn over, and are more satisfied with their jobs than the unmarried ones. In fact, married employees are more conscious of their responsibilities. Satisfaction levels were found to be in equal ratio among both married and unmarried employees. Employees belonging to both categories were unsatisfied in terms of the salary they got from organizations. Marriage imposes additional responsibility hence the need for steady job and steady income.

v) Education

Education has its effect upon individual behavior largely through the level and type of education received. Increased levels of education serve to increase an individual’s expectations about positive outcomes. These outcomes are generally perceived to be a more satisfying job, higher income level and greater alternative sources for occupational choice i.e. the good life.

vi) Religion

Religion and culture also determine attitude towards work and towards financial incentives. In other words, religion and religiously based cultures that play an important role in determining some aspects of individual behavior, especially those that concern morals, ethics and a code of conduct. Highly religious people have high moral standards and usually do not tell lies or talk ill of others. They are highly contented thus strive for the goal of achievement and self-fulfillment.

vii) Abilities

Ability refers to the actual skills and capabilities that a person possesses and is required for the effective performance of activities. Ability of an individual is made up of two sets of skills i.e. intellectual ability and physical ability. Railways need to ensure that its employees possess the necessary abilities to engage in the behavior required for effective performance. This is accomplished either by careful selection of people or by a combination of selection and training.

2. Psychological Factors

Psychological factors may include perception, values, attitudes, psychological needs, personality and motivation. All factors can be explained as follows:

i) Perception

Perception is an outcome of an object. It is the view point which one interprets a situation. For instance, a railway booking clerk facing a well-dressed person perceives him to be of high status and talks to him nicely, whereas he tends to ignore an ill-dressed person, or make him wait, though both the passengers want first class ticket. Perception is a major factor that contributes to individual behavior and differences, both in personal and organizational life.

ii) Values

Values are the foundation for behavioral difference among individuals, and they help in understanding the attributes and motivation. Values represent the basic conviction that a specific made of conduct is personally or socially preferable to an opposite mode of conduct. They have both context and intensity attributes. The context attribute says that a mode of conduct is important and the intensity attribute gives importance to specific. Values are judgmental by nature, and every individual has a different conception of what is right, good or desirable and what is not right, not good or undesirable.

In the today’s modern and competitive business environment, managers have to be capable of working with people from different cultures. Because values and attributes differ across cultures, and understanding of these differences will be helpful in explaining and predicting the behavior of employees form different cultures.

iii) Attitudes

The term ‘Attitude’ is very common and used in everyday life to describe people’s behavior. It is a way of organizing a perception. In other words, it is more or less a stable tendency to feel, think, perceive and act in a certain manner towards an object or a situation. It is a tendency to act in a certain way, either favorably or unfavorably concerning objects, people or events. Attitude has three elements in it that lead to measurable outcomes. These are feelings, thoughts and behavior. Feelings and thoughts can be measured by simply asking individuals about their feelings and opinions. Behavior can be measured either by actual one’s actions or simply by asking the person how he would act in a certain situation. By measuring and integrating these three elements, a person’s attitude towards a given situation can be established.

In general, a person may have a positive attitude which means a good outlook of life, or negative attitude which means continuous complaining about problems in life. For example, if you showed a glass half-filled with water to A and B and asked them to describe it.

If A says, “The glass is half-full”, B says “The glass is half-empty” then here A’s attitude is positive and that of B is negative. Positive attitude is something that organizations look for while interviewing candidates. Organizationally speaking, an employee’s negative attitude about work may be reflected by sub-standard work performance, excessive absenteeism, excessive complaining about work environment or disobedience of rules or authority. These attitudes can be changed with simply persuasion or by training and coaching.

iv) Psychological Needs

Psychological needs basically mean the internal needs of a person. Individuals differ in their patterns of psychological needs. Such needs are derived from the source within an individual. Every individual has a different kind of need. There are three basic psychological needs: need for excellence, need for affiliation and need for power. Types of psychological needs and their behavior are shown in the table.
PsychologicalCharacteristicsBehavior (Outcomes)
1. Need for Excellence
  • Compete with standard of excellence
  • Set challenging goals
  • Very persistent
  • Look for alternative paths to achieve goal
  • Desire for a challenging job and recognition
  • High productivity
  • High turnover rate
  • Low satisfaction level
2. Need for Affiliation
  • Establish and maintain close personal relationship
  • Display emotions openly
  • Very warm in relationship
  • Low Productivity
  • Average turnover rate
  • Low satisfaction level
3. Need for Power
  • Authoritative
  • Hungry for status
  • Desire to be informed about everything and to monitor things
  • Do not encourage any questioning by subordinates
  • Average productivity
  • Average turnover rate
  • Low satisfaction levels                                 

v) Personality

Personality factors must be taken into account in determining the suitability of an individual for a position in an organization. It refers to personal traits such as dominance, aggressiveness, persistence and other qualities reflected through a person’s behavior. An individual’s personality determines the type of activities for which he is suited and the likelihood that the person would be able to perform the task effectively.

vi) Motivation

Happy workers are the productive workers. To make them happy proper motivation is so essential. Motivation refers to all the forces operating within a person to cause him to engage in certain kinds of behavior rather than others. Motivation may be internal e.g. a person’s skill, ability and intelligence; or external e.g., incentives, training, etc. Further, a person’s motivation is influenced by this attitudes, beliefs, values and goals.

3. Organizational Factors

Individual behavior is influenced by a wide variety of organizational system and resources. Systems such as the organizational structure and hierarchy strongly influence and constrain both what individuals do and how they do. Some of the main organizational factors are organizational culture and climate, tenure, reward system, leadership style etc.

i) Organizational Culture and Climate

Organizational culture and climate also affect an individual’s behavior at work. The various dimensions of organizational culture are values, ethics, beliefs, climate and culture. Organizational climate can be divided into following four categories.

ii) Tenure

Tenure refers to the length of time an employee spends with an organization. It has a direct impact on productivity, job performance, turnover and absenteeism. There is a positive relationship between seniority and job productivity and a negative relationship with seniority and absenteeism. Tenure is another important factor that has an impact on an organization’s turnover. The longer a person continues in a job, the less likely he/she is to quit. It is also true that there is positive relationship between tenure and satisfaction. People who work longer with an organization are not only satisfied with their work, but are also loyal to the organization.

iii) Reward System

Reward system is another influencing factor to the individual behavior. There is positive relationship between rewards, and individual’s work performance. It means when people perform well, they are positively reward through awards, encouragement and appreciation. The aim of rewards should be to develop among employees pride in belonging to the organization and a feeling that people are valued.

iv) Leadership Style

Leadership style is another factor that helps in determining individual’s behavior at work. Leadership styles can be divided as autocratic, democratic, participative and consultative.

  • Autocratic Leaders: Autocratic leaders take decision on their own, without consulting other and use threats and other coercive ways to make people comply with their decisions. Autocratic leaders can only be effective when there is no need for any contribution from the others in the decision making and where the motivation of people to implement the decision will not be affected by the fact that they were not involved in the decision making.
  • Democratic Leaders: Democratic leaders involve their people in decision making. Democratic decision making may be difficult when the options differ widely and it is difficult to arrive at an equitable final decision. With this kind of leadership style, labor turnover and absenteeism rate is low and productivity is high.
  • Participative Leaders: Participative leaders involve people at all levels in the decision-making process. Participative leaders attend to people’s problems and use rewards to encourage appropriate performance. Individual performance is high with this kind of leadership style, and people have a spirit of collaboration. 
  • Consultative Leaders: In consultative leadership style, the focus of control for day-to-day decision making and problem solving shifts from the leader to the group members. Individuals display a fair amount of responsibility and ownership of the decisions made. Since a lot of responsibility is with the subordinates, turnover and absenteeism rate is low.

4. Environmental Factors

Three main environmental factors that affect individual behavior are economic factors, political status and technological changes.

i) Economic Factors

Economic factors play a very important role in determining individual behavior. All work is performed within economic framework that both directly and indirectly the individual behavior. Economic factors that influence individual behavior are:

  • Employment Opportunities: Employment opportunities have strong influence on individual behavior. Fewer job opportunities create fear of losing the present job and increase the emphasis on job and increase the emphasis on job security and can change the basic motivation pattern of the individual.
  • Salaries and Wages: Salaries and wages satisfy various individual needs. They provide food and shelter, and measurement of achievement and can even serve as status symbol. Money is a complex variable and it affects on behavior tremendously. It is well known that wages attract people to certain organizations and determine their satisfaction on jobs.
  • General Economic Outlook: The general outlook also influences individual expectations. Especially of those employed in industries, severely affected by economic cycles. In fact, some employees experience layoffs and recalls during their entire working life, while others are insulated from the economy (e.g., public sector employees). Individuals who experience frequent layoffs are more likely to be motivated by factors that affect job security, while other individuals would consider job security to be relatively unimportant and would be motivated by other factors.
  • Political Status: Political status of a country affects individual behavior in many ways. When a country’s political status (government) is stable, it increases industries, increase job opportunities and higher wages. An unstable government companies are reluctant to invest, economic status is affected, jobs are affected, and ultimately individuals get affected.

ii. Technological Change

Technological change is included as an economic factor because of its potential effects upon individual job opportunities. Technological change has its strongest impact at lower level jobs, although increased automation, robotics, computerization and more sophisticated production technologies can affect individuals at all levels. In addition to changing employment opportunities, technological change has its effect on job design. Although the individual may stay employed, the skills required to perform the job may be reduced, thus increasing the downward pressure on wage rates.

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Challenges and Opportunities for Organizational Behavior

The world order is changing dramatically and is in the process of complete transformation. The impossible things of yesterdays have become possible today and impossible things of today will become possible tomorrow. That is why it is said that change is the only permanent aspect of nature. The concept of self-sufficient nations is losing importance and the concept of ‘Global Village’ is emerging. Management of organization is bound to cope up with the radical transformation by developing new techniques and practices in the global perspective after carefully analyzing the real challenges being faced by the professional managers.

Challenges and opportunities for organizational behavior can be better understood with the help of following points.
Challenges and Opportunities of Organizational Behavior

1. Globalization

Globalization is the process of economic integration at the international level. Multinational companies are helping this process with the whole world being converted into a single global market place. Individuals and organizations buy raw materials, technology, services and resources from the providers who offer high quality with low price. In this respect, the most critical component is human resource. It is extremely difficult to get the requisite competence because of the high competition to acquire that, which is in short supply.

While globalization has opened up global opportunities, it has also led to the failure of local business, different impact on cultural ethics, values and customers etc. It has positive (opportunities) impact as well as negative (threats) impact in an organizational behavior. Some of the challenges posed by globalization are:
  • Organizational change and restructuring
  • Adopting new technology
  • Downsizing and their impact on human behavior etc.

Similarly, some of the opportunities posed by globalization are:
  • Low cost advantages by completing in global market.
  • New career perspectives
  • Transform of skills and technology
  • New investment opportunities
  • Positive changes in attitudes of different people from different countries etc.

2. Changing Profiles of Employees and Customers

There has been a drastic change in the profile of people joining organizations (employees) and those benefiting from the services of organizations (customers). Both employees and customers are now better informed and better educated because of the available choices, which are increasing every day. Both are highly demanding and are beginning to almost dictate to organization.

The best and the brightest people (employees) look for organizations that will fasten their personal growth and help them to feel empowered so that they have a sense of ownership, both psychological as well as physical. Expectation and values are changing. Bright young individuals who join organizations want assignments that are challenging and that allow them to prove themselves. Therefore, the changing profiles of employees and customers have opened opportunities as well as provide threats to the organizational behavior.

3. Increasing Workforce Diversity

Diversity has emerged as an issue because of imbalanced representation of diverse groups in the workforce. Nepal has not only been a diverse society, it has also valued and celebrated diversity. The term “synergic pluralism” has been suggested to describe Nepalese culture, citing examples and legends of how diverse religious and ethnic groups coming from outside were made welcome and were encouraged to maintain their identities. There are several bases on diversity which are as follows:
  • Demographic: Age, gender, education etc.
  • Social: Religion, language, region, caste, tribes, physical and mental handicaps etc.
  • Ideological: Different ways of perceiving issues, own thoughts, ideas etc.
Such diversities are increasing in developing as well as developed countries. Increasing workforce diversity has opened new opportunities to the today’s business organizations and has provided threats to the organizations and its behavior.

4. Social Responsibility and Ethics

While corporate organizations are using all facilities available in the society for their growth, they need to reciprocate by doing something for the societies where they exist and benefit from. This need is reflected in the concept of corporate social responsibilities. Corporate social responsibility (CSR) is a company’s commitment to operating in an economically, socially and environmentally sustainable manner, while recognizing the interest of its stakeholders, including employees, government, investors, customers, business partners, local communities and society.

Similarly, a commitment to ethical conduct lives at the heart of corporate social responsibility. To successfully adopt strong CSR practices, a company must define its ethical principles and reflect how they impact the company’s business practices. An important step in this process is reinforcing ethical conduct among employees through ethics training programs. Therefore, social responsibility and ethics have opened opportunities as well as challenges to the organizational behavior.

5. Quality and Employee’s Productivity

As a result of globalization and free-market economy, demand for better quality services and products is increasing both domestically and internationally. As a result of the global competitiveness industries have to adopt internationally recognized and proven quality management system in their operations in order to stay in the business. As customers have become highly quality conscious and have a wide array of choices for different products, goods that do not meet quality standards (rejected goods), they find a new “second market”. The concept of total quality management (TQM) is highly emphasized in today’s business organizations to improve quality as per customer’s expectations.
Total quality management (TQM) is defined as an organization’s total dedication to strive for quality and customer satisfaction, and benefits, growth of all members of the organizations and to make a better society by participation of all its members. In the other hands, productivity can be defined as producing maximum with minimum cost. Productivity is the ratio of total outputs divided by total inputs for a particular point of time. Similarly, employee’s productivity can be defined as getting best from employees irrespective of compensation and benefits paid to them. The challenge, therefore, is to evolve strategies so that employees give their 100 percent to the organization, feel that they are a part of it. And to help them grow as well as enhance the productivity of the organization.

As the essence, the matter of quality and employee’s productivity provides opportunity as well as challenges to the today’s organizations behavior.

6. Organizations Change and Development

Individuals develop with the change and development of their organization. The behavior of the individuals and groups is highly influenced by organizational change and development processes. An organization which keeps on running various organizational change programs and works for organizational development creates environment of positive vibrations. Organizational change and development factor creates opportunities to the organization as well as provides threats to the organization and its behavior.

7. Information Technology

The world has entered the information age surpassing the industrial age which has been made possible by the ever increasing developments in the field of information technology (IT). The way we access and assimilate information and the emergence of new methods of packaging information have given birth to a revolution more complex and powerful than the liberation of the printed word that started in the Middle Europe around the 15th century. The IT revolution is about real-time access and sharing of digital information, consisting of visual images, sound and virtual worlds, made possible by core information technologies like digital networks, information data banks and computer graphics.

It has a significant influence on work, the work environment and working relationships. Information technology results in better work, because it incorporates technical skills which encompass the ability to apply specialized knowledge. It has been studied that people get more satisfaction if they develop their technical skills. Interpersonal roles, information roles and managerial function are improved with technology. In other words, it is an application of knowledge to perform work. Information technology has the following characteristics:
  • It determines the level of skills required.
  • It improves efficiency and thus organization feels secure.
  • It determines the productivity of an organization.
  • It influences the social situation.
  • It influences organizational structure.
All these factors shape the behavior of people concerned. Therefore, it opens opportunities as well as threats to the organization and its behavior.

8. Corporate Re-organization

Because of changes in the economic, political and international environment, many corporations have resorted to reorganization to remain competitive in the market. Mergers and acquisitions in today’s business environment are not uncommon. Such events require reorganization having impact on the employees of concerned companies. The employees experience anxiety and uncertainty about their places in the new organization. The employees of both the ‘taking over’ as well as the ‘taken over’ companies will have anxious moments because of the following factors:
  • Fear of loss of jobs
  • Job changes, including new roles and assignments
  • Transfer to new geographic location
  • Changes in career possibilities
  • Changes in remuneration and benefits
  • Changes in organization power, status and prestige
  • Changes in group dynamics
  • Change in corporate culture

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Basic Assumptions of Organizational Behavior (OB)

Every field of social science has a philosophical foundation of basic concepts that guides its development. Organizational behavior is based on the basic concept of human relations which is a noteworthy social approach towards the establishment of inter-personal relationship between superiors and subordinates. Organizational behavior deals with a set of fundamental concepts revolving around the nature of the people and organization. These concepts of organizational behavior are as follows:
Basic Assumptions of OB

1. The Nature of People

With regard to people, there are four basic assumptions: individual differences, a whole person, caused behavior (motivation) and value of the person (human dignity).

a) Individual Differences
People have much in common but each person in the world is also individually different. The idea of individual differences comes originally from psychology. From the day of birth, each person is unique and individual experiences after birth make people even more different. So, management can get the subordinates motivated by treating them individually and differently. Only one measure of motivated all people working in an organization. Some are motivated by money, but some other by status and any other. Hence, overall motivation plan is needed to deal with subordinates individually. Therefore, individual differences mean that management can get the greatest motivation among employees by treating them differently.

b) A Whole Person
Some managers think that they have employed a person just for his labor, skills or brain. So, they are concerned with his labor of work only but he has to employ a whole person rather than certain separate characteristics. Managers have to do a lot with a person’s personality, personal life, knowledge, development and other things. Though a person’s different traits may be separately studied, but in final analysis, they are integral part of one system making up a whole person. Skill does not exist apart from background or knowledge. Home life is not totally separable from work life and emotional conditions are not totally separable from work life and emotional conditions are not separable from physical conditions.

c) Caused Behavior (Motivation)
We know that behavior has certain causes. These may related to a person’s needs, and/or the consequences that result from acts. In case of needs, all normal human behavior and his/her course of future actions, both are caused by a person’s need structure. This fact leaves management with two basic ways to motivate people. It can show them how certain actions will increase their need fulfillment, or it can threaten decreased need fulfillment unless they follow a required course of action. Clearly a path towards increased need fulfillment is the better approach. Motivation is essential for the operation of organization. No matter how much machinery and equipment an organization has, these things cannot be put to use until they are released and guided by people who have been motivated. The management can create a suitable environment in the organization, conductive to the fulfillment of individual needs within the overall structure.

d) Value of the Person (Human Dignity)
Value of the person is more an ethical philosophy than a scientific conclusion. It confirms that people are to be treated differently from other factors of production because they are of a higher order in the universe. It recognizes that people are of a higher order, they want to be treated with respect and dignity, and should be treated this way. Every job, however simple, entitles the people who do it to get respect and recognition of their unique aspirations and abilities. The concept of human dignity rejects the old idea of using employee as economic tool. Therefore, treatment of the working staffs as a respectable human being, appreciation of their skills and recognition of their personality are very important basis of human relations.

2. The Nature of the Organization

With regard to organizations, the key assumptions are that they are social systems and that they are formed on the basis of mutual interest.

a) Mutual Interest
Organization theory tells us about the mutuality of interest between individuals and organization. In the other words, mutual interest is represented by the statement “Organizations need people, and people also need organizations”. Organizations have a human purpose. They are formed and maintained on the basis of some mutuality of interest among their participants. People see organizations as a means to help them reach their goals while at the same time, organizations need people to help reach organizational objectives. If mutuality is lacking, it makes no sense to try to assemble a group and develop co-operation, because there is no common base on which to build. Mutual interest provides a super-ordinate goal that unites the variety of needs that people bring to organizations. The result is that people are encouraged to attack organizational problems rather than each other. So, the management should try to co-ordinate the common goals and to motivate individual in a nice manner because members will like to continue within the organization as long as they feel that their interest are being served by attaching to the organization.

b) Social Systems
Organizations are social systems, consequently activities therein are governed by social laws as well as psychological laws. In other words, each organization is a social group having small number of groups. As people have needs, these organizations also have their needs, status and role. In fact, two types of social systems exist side-by-side in organizations. One is the formal (official) social system, and the other is the informal social system. The existence of a social system implies that the organizational environment is one of dynamic change, rather than a static set of relations as pictured on an organization chart. All parts of the system are inter-dependent and subject to influence by any other part. Everything is related to everything else. The idea of a social system provides a framework for analyzing organizational behavior issues. It helps to make organizational behavior problems understandable and manageable.

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Public Administration, Public Policy Making and Policy Analysis

There is no such definition of public policy analysis which is accepted or agreed by all academicians or practitioners, research scholars and other concerned as public administration. So, it means there is no single definition of Public Policy Analysis (PPA), which covers the whole range of the study. The most appropriate way is to define the terms Public, Policy and Analysis separately so as to get the clear concept of PPA.


Public means government. So, the focus or attention of this regard is on the governmental actions, but now activities of private and semi-governmental like corporations also come under the boundaries of the public administration. However, public, here means governmental action. Governmental actions are always complex, interdependent and multifaceted as compared to private. For example, the governmental actions like health and education and agricultural production are interdependent.


Policy is what government says; do or do not do. It indicates the goals or purpose of the government programs. For example, to eliminate poverty, to train human resources etc. Policy is an important ingredient of the programs. Policy cannot be implemented without effective programs.

Policy can be defined as a purposive course of action followed by an actor and factor (government institutions or agencies) or a set of actors while dealing with the problem. Policy without implementation is meaningless.

Policy may be:
  1. Implicit, covert, unstated, latent
  2. Explicit, overt, stated, apparent
1. Implicit Policy: Implicit policies are those policies, which are open to those only who are intimated familiar with programs. Sensitive issues like defense, finance, foreign etc. are the growth of the discipline of public administration.

2. Explicit Policy: Explicit policies are those policies which are open to all the form of constitution, laws, by-laws, rules and regulations, speeches of the leader or top-executive officials in the programs.

Policy (once made is not forever) with the change of time and environment policies have to be changed. Change in policy can be made overtly. Through proposing new policy agenda and taking the responses or opinions of concerned agencies and individual and sometime policies are changed in light of the emergency issues modified to adjust the situation. Sometimes, it may be totally scrapped.

Covertly made like a changes made by a chief executives. For example, policies orientation of the national sports council is to promote sports activity throughout the country whereas during the Panchayet period, the policy orientation was against the actual spirit of the council.


Analysis is the process of evaluating and measuring the impact of any particular policy by using appropriate scientific tools and techniques. They help to determine the efficiency and effectiveness of the impact of particular policy.

Analysis means measuring and evaluating the impact of a particular policy. Analysis demands the application of objective and scientific tools and techniques to assess the impact of policy. The objective is to determine the effectiveness and efficiency of the impact of particular policy. Analysis is the concern only after the policy has been implemented. Analysis is to require to know the projected consequences of policy. In addition, analysis is required to measure the impact of a particular policy and also to understand the policy making process.

Another definition of Thomas R states that “Public policy is whatever governments choose to do or not to do.” There is a rough accuracy of this definition.

In its simplest term, policies developed by the governmental bodies and officials (non-governmental actors and factors may of course, influence policy development). According to David Eston, "Public policy stem from the “authority” in a political system, namely elders, paramount important person, chiefs, executives, legislator, judge, administrators, councilors, monarchs, and the like."

Policy without analysis will be like schooling in the darkness

First, public policy is purposive or goal oriented action rather than random or choice behavior is our concern. Public policy in modern political system are not, by and large, things that just happen.

Second, policy consists of course or pattern of actions by governmental officials rather than their separate, discrete decisions. For example, policy involves not only the decisions to enact a law on some topic but also a subsequent decision relating to its implementation and enforcement.

Third, policy is what governments actually do in regulating trade, controlling inflation or promoting public housing, not what they intended to do or say they are going to do.

Fourth, public policy may be either positive or negative in form. Positively, it may involve some form of the government action to affect a particular problem and negatively, it involves a decision by government officials not to take action, to do nothing on some matter or which government involvement is sought.

Lastly, public policy is making never easy; it requires a high sense of responsibility and a willingness to take the initiative as well as to assume risks. There are many other difficulties as well as complete information is unobtainable. The evidence is rarely conclusive; different interest urge different course of action, outcomes are unknown, feedback is irregular, and processes are not properly understood, not even by the participants.

Various types of Policies

Generally, we find six types of policies and they are;
  1. Substantive Policy
  2. Regulatory Policy
  3. Distributive Policy
  4. Redistributive Policy
  5. Capitalization Policy
  6. Ethical Policy
1. Substantive Policy: These are concrete policies which take into account the general welfare and development of the society. It deals with the society as a whole and not with any particular or privileged segments of it. It deals with economic stabilization, education and employment opportunities to all irrespective of caste, color, sex or breed, measures of safety, law and order enforcement, pollution and adulteration eradication etc. in broader term, these policies deals with the stable society living in the inhabitants in a given political system.

2. Regulator Policy: Regulatory policies are those where the trade, business, safety measure, public utilities etc. are regulated by independent organizations having legal personality. These corporations and organizations work on behalf of the government financial autonomy to these organizations. The various example of such organizations or corporations in Nepal are insurance corporations, water supply corporations, electricity authority, transport corporations, financial institutions etc.

3. Distributive Policy: Distributive public policies include all public assistance and welfare programs to society. These differ from the substantive policies as those are for whole of the society but the distributive policies are meant for specific segments of the society. These deal with grant of goods, public welfare and health services. These include policies like sterilization for family planning purpose, vaccination of the children, food relief etc.

4. Redistributive Policy: The prime motive of the redistributive policies is to rearrange the basic programs of the social and economic aims. The rescheduling with the enactment of public policies is made in such a manner whereby the rich have to pay more as taxes in comparison to the poor, certain public goods and welfare services are inappropriately divided among service segments of the society by the distributive policies is also made through the enactment of redistributive policies.

5. Capitalization Policy: Capitalization policies are different than other policies. Under these policies, subsidies are given by the central government to the regional, districts and local level authorities. Sometimes subsidies pertaining to some other important spheres, are also given by the central government. Policies regulating such like issues are known as capitalization public policies.

6. Ethical Policy: Moral and ethical values of the citizens play a significant role in shaping the destiny of a nation. It is not the gold and silver which make the country great but it is always a human beings which establish the greatness of their country by virtue of certain ethical principles. Ethical public policy is separate category from the regulative policies of law and commerce. It is well known fact that corruption is rampant these days and it won’t be wrong to say that is at its peak now. The major reason for it are lack of effective public opinion, improper education and awareness among the masses.

Policy Implementation

Often the policies require some action of execution and implementation. The implementation process has certain activities working within it such as issue and enforcement of directives, funds instruments, loans and grants sanction, gathering and assigning on information, roles and duties assignment among the personnel engaged in implementing.

Administration or Bureaucracy

Most of the activity surrounding policy implementation takes places within administrative or bureaucratic agencies. The implementation of policies is largely done by the bureaucrats as they have control over the resources and legal powers of the government though the bureaucrats and the officials are supposed to carry out the policies on the lines told by the political executives but bureaucrats use their own discretion in implementing a policy decisions. Hence administrative agencies are the primary implementer of public policy. Many other actors may also be involved and they are the legislature, court, pressure groups and community organizations. They may often directly involved in policy implementation or act to influence administrative agencies, or the both.

The Legislature

The administration and implementation of public policy is also made by the legislature. If the policy initiated in the legislature is enacted by the legislature in full details, it would leave little choice with the administrative agencies and bureaucrats for implementing it in their known way. It sounds more logical in democratic political system that the policy should be discussed and questioned in detailed manner by the duly elected representatives of the people. But in actual practice, the work load of legislature has increased upto such an extent that they normally not find enough time, technical expertise to deliberate on these issues.

The Court

The court also implements some of the policies. Normally, it happens when policy is not clearly worded or different interpretation of a policy could be taken up. In such cases, the court gives its verdict and whatever is decided, the court is normally considered final unless the legislature again legislates on that.

Interest Groups

Since the legislature through delegated legislation leaves certain point to be filled in the broad framework of the policy by the administrative agencies, the group struggle shifts from the legislative to the administrative areas. Therefore, when interest groups face unsuccess at the time of policy making, the legislature exercise their influence over the administrative agencies for implementation of those points in the manner which suits the interest of these groups.

Community Organization

Communities have sometime been used for the administration of the government programs. Most common examples are; farmers committees for water, soil conservation, forest conservation etc. Such agencies are also considered important means of enlisting or encouraging people’s participation so as to strengthen the involvement of local people particularly unorganized group. In short, a variety of participants affects the administration of a given policy.

Decision Making

“Decision making is a bridge between thought and action. It is a course of action consciously chosen from among the available relevant alternatives for the purpose of achieving desired objectives.” Manager sometimes see decision making as their central job because they must constantly choose what is to be done, who is to do it and when and where and occasionally even how it will be done. Thus, the power to make decision has been correctly identified with the power to manage.

There are three types of decision which may generally be necessary in organizational settings and they are;
1. Policy decision: They set forth goals and lay down principles covering the conduct of organization.
2. Administrative decision: They translate policies into action and determine means to be used.
3. Ad hoc decision: They are made as and when necessary basis wherever particular cases come up at the point where the job is carried out.

Rationality and Decision Making

Complete rationality can never be achieved, particularly in the area of managing. First, decisions are not for the past but for the future, and the future almost invariably involves uncertainties. Secondly, all the alternatives that might be followed to reach a goal can hardly be recognized, particularly true to do something that has not been done before. Moreover, not all alternatives can be analyzed even with the newest available analytical techniques.

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Good Governance: Concept and Meaning of Good Governance

The concept of good governance came into use as an academic discussion in the late 1980s and early 1990s particularly during the Habital conference of UN, in Turkey in 1996. Accountable, predictable, responsible and legitimate governmental procedure demanding ‘clean state’ in the notion of good governance. It was firstly introduced by Organization for Economic Co-operation and Development (OECD) for their investment in developing nations. They identified good governance as:
  1. Participation
  2. Democratization
Similarly, World Bank advocated good governance in sub-Saharan Africa by means of: 
  1. Participation 
  2. Accountability
  3. Democratization
  4. Efficiency and Effectiveness 
  5. Rule of Law
In Governing procedure, UNDP introduced its principles of good governance which are;
  1. Participation
  2. Legitimacy 
  3. Accountability
  4. Rule of Law
  5. Visionary and strategic planning
  6. Efficiency and Effectiveness
  7. Responsiveness
  8. Result oriented 
  9. Performance 
  10. Democratic
  11. Transparency
Thus, good governance, rule of law, legitimacy, accountability, efficiency and transparency are symbols of the ‘clean state’.

Administrative machinery has to take responsibility for the timely complain of the nation’s development programs. For this, administrative machinery needs to be capable, impartial, productive economical, people oriented and accountable. Good governance can be defined as a corruption free government, which provides goods and services to the people in equitable manner. The concept of good governance advances five principle for livable and sustainable societies: 
  1. Politically participation
  2. Economically productive
  3. Ecologically sustainable societies
  4. Culturally vibrant (full of life and energy and exciting)
  5. Socially just.
The World Bank defined governance as a way in which power is exercised in the management of the economy and social resources of a country, notable will a view to development. The UNDP defines good governance more or less above but place greater emphasis on sustainable human development (UN Report, 1998). The definition varies from one organization to other, although general ideas and focus on issues are the same. The World Bank put emphasis on economic and social resources for development. The Organization for Economic Co-operation and Development (OECD) emphasizes human rights, democracy and legitimacy of government. UNDP emphasizes human development, the elimination of poverty, and public administration. It has even established a management and governance division. Good governance is therefore the highest state of development and management of a nation’s affairs. It is good that a democratic form of government is in place, that people participate in decision making process, that service are delivered efficiently, that human rights are respected, and that the government is transparent, accountable and productive. The concept can also regarded as a means to an end in that in general. It contributes to economic growth, human development and social justice. Good governance as a concept will be used in this context of the public service reform it is used as a means of addressing other contemporary issues such as institutional development, capacity building, decentralization of power and authority, relation between politicians and appointed officials, co-ordination and the roles that head of government play in promoting good governance. Good governance can be aliened by identifying the following characteristics and practises of poor governance allure to make a clean distinction between what is public and private, hence a tendency to divert public resources to private gain.
  • Failure to establish a predictable framework of law, government behavior add the rule of law
  • Excessive rules and regulation which impede the functioning of markets
  • Priorities inconsistent with development, resulting in a mis-allocation of resources
  • Excessively narrow-based or non-transparent decision-making processes
  • Lack of code of conduct in managing the affair of state
  • Lack of clearly defined policy assumptions
Good governance is therefore, among other things, participatory, transparent and accountable, in order to ensure that political, social and economic priorities are based consensus in society, and that the voices of the poorest and most vulnerable are heard in decision-making processes regarding the allocation of resources. Defined in this manner, good governance has major implications for equity, poverty and quality of life. Administrative governance is the system of policy implementation encompassing all three, good governance defines the process and structure that guide political and social-economic relationships. 

Good Governance

While there may be no best way of achieving good governance, the following stand out as the most common elements. They are participatory, accountability, transparency, combating corruption, rule of law, absence of arbitrary power and an enabling judicial framework.

1. People’s participation
Good governance focuses on participation. Participation is basic to realize the spirit of development management. It is an association of people in the development process that has glowingly been emphasized by the most of the developing countries oriented towards achieving induced changes particularly at the grass root level. It is in this regard that participation of people in decision-making, implementation benefits sharing and evaluation of the development programs and project constituted vital considerations for making the present and future development endeavors meaningful and viable. With the growing realization of the need and importance of the involvement of non governmental organization, community base organization and civil society organization in the planned change process, the importance of participation has increased immensely hence the involvement of all the stakeholders involved directly or indirectly in the socio-economic change process assumes great significance in development management. The basic trust of participation lies in sustained capabilities for development decision making, action and overall management reflected in sustained activities at grass root level. In addition to effective institutional mechanism for supporting participation, the level of people including their skills, knowledge, awareness and motivation represent an important concern for enlisting the level of participation. From a broader perspective, participation demands measure to support economic growth and distributive justice as well as improved level and status of social services.

2. Accountability
Accountability can be defined as holding responsible elected or appointed individuals and organizations charged with a public mandate to account for specific actions, activities or decisions to the public from whom they derive their authority. In a narrow sense, accountability focuses on the ability of account for the allocations, use and control, i.e. budgeting, account and auditing. In broader sense, it is also concerned with the establishment and enforcement of rules and regulations of corporate governance.

3. Transparency
Transparency is broadly defined as public knowledge of the policies of government and confidence in its intentions. This requires making public accounts verifiable, providing for public participation in government policy-making and implementation and allowing contesting over choices impacting on information on economic and market condition.

4. Combating Corruption
Corruption is defined as the abuse of public office or public trust for private gains. The definition covers most forms of corruption in both the public and private sector. Combating corruption is a key indicator of commitment of good governance. Corruption can manifest itself as an individual, organizational or institutional.

In the context of the state, corruption most often refers to criminal or otherwise unlawful conduct by government agencies or by officials of these organizations acting in the course of their employment.

Poor governance and corruption are major constraints to the pursuit of economic development. For example:
  • Bribery increases the cost of government development programs and spawns projects of little economic merit.
  • Corruption undermines revenue collection capacity, contributing to fiscal weakness and macro-economic difficulties.
  • Diversion of resources from their intended purpose distorts the formulation of public policy.
5. Rule of Law
The expression “Rule of Law” is often referred to when democratic liberties are discussed. A. V. Dicey gave three meanings to the expression.
  • The absence of arbitrary power.
  • The subjection of officials to the ordinary courts.
  • The constitution is the result of the ordinary law of the land.
6. Absence of Arbitrary
The underlying concept was that no man may be punished in body or goods except for the distinct breach of law established by ordinary procedure before the ordinary court. Hence, it was not possible for a person to be deprived of liberties or property by arbitrary action on the part of the executive.

Dicey’s second meaning stressed the equality before the law of all classes and equal subjection of all citizens to the ordinary courts. From the higher ‘P’ to lower ‘p’, law should be one for all. 

In Britain, rights as freedom of movement, freedom from arrest, freedom from speech and the like, derived from judicial decisions and not from the constitutional code, freedom of information and expression need for formulation of public policies; decision making, monitoring and evaluation of government performance. It also includes independent analysis of information by the professional bodies and civil society.

[PERCEPTS] [CLEART]Clean Legitimate Efficient and Effective Accountable Responsive Transparent

Good governance should basically mean balanced government.

Governance of private sector, NGOs and cooperatives should harmoniously share the responsibility of governance by protecting the interest and meeting the needs of the people.

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