Delivery in day(s): 5
Diploma in Business
Unit Number and Title
Unit 3 Organisation Behaviour Structure
Organisation behaviour structure unit is about the structure and culture of the organisation. Organisation structure and culture are very much related as they are based on the beliefs, principles and values of the organisation. Organisations follow the systematic approach to run their business. It needs to adopt many approaches by which the processes can be conducted. Different organisation use different management, leadership and organisational theories according to the structure and culture of organisation. There are various types of management approaches like scientific approach, classical approach and human relation approach etc. These management approaches describes the style of leadership. Leadership is about influencing employees to perform better for a common goal. The democratic leaders allow their employees to participate in decision making process while the autocratic leaders follow persuading leadership style and take the decision on their own.
Leadership is also about motivating the employees. Different people use different leadership style;likewise, different motivational theories are followed to motivate people. Some of them are Maslow hierarchy needs theory, ERG theory etc. Teamwork is another important aspect that is to be considered for better performance of the employees. Teamwork allows people to work in groups for common purpose. Technology also has positive implications on the team work as it makes it easier for the employees to connect.
Every organisation works differently according to their different culture and working patterns. All the policies, patterns and culture of the organisation shape its structure. Organisational structure is based on many characteristics. If we consider the organisation that are formal in nature that is the organisation following a formal structure then it can be categorised as:
The organisation structure has some basis on which it is formed. These bases tell us about the reporting lines and the number of employees under one superior.
Let us understand more about the structure of the organisation by comparing two organisations.
Below is the classification of the organisation culture: Organisational culture is about what an organisation believes in. Organisation culture is formed by the values and the principles on which the organisation runs.
If we again talk about both the organizations, that is CAPCO and HSBC. CAPCO has a culture where employees have the freedom to come up with their own ideas but they are not allowed to take the decisions on their own. HSBC also believes in innovation and creativity by the employees but they also provide freedom to their employees to make decisions themselves.(Marshall, 1993)
The basis of any organisation is its culture and structure. The organisation culture and its structure are somehow related to each other and hence affect the performance of the organisation as a whole. If a company has a traditional organisation structure with more levels of hierarchy than there will be a poor communication channel between the superiors and the employees as it is very difficult for an employee to reach up to the top business management people to share his views.
As we read that CAPCO has a flat organisational structure with fewer levels of hierarchy than it automatically makes it easier for the employees to communicate. Hence, we can relate the structure of the organisation with its culture. (Capco.com, 2016). Now the question arises that does the organisation culture and structure affects its performance?
The answer to this question is “yes”. It is very clear that if there is no communication barrier between the employees, it is easy to share views with others and this affects the performance of the individual as well as of the organisation in appositive way. CAPCO’s growth rate is 14.7%, which is far better than its competitor’s growth rate. The reason behind this growth is the culture of the organisation that believes in values of integrity, creativity and involvement of employees. Involvement of employees on the decision making process makes him feel as a part of the organisation and this becomes a motivational factor for the employees to perform better.(Thomson, 1974)
To improve the communication between the employees who are working at different location, CAPCO introduced a social networking application called CaplnTouch. It makes the connection easier and allows the employee to connect. The efforts made by the organisation for improving the communication of employees shows its positive results in the form of better performance of employees and in turn the performance of the organisation.
The behaviour of the employee at work can either be affected by the factors related to the organisation or the factors related to his own self. The organisational factors could be the working environment, the fellow employees, organisation culture etc. The personal factor includes the personality of the employee, his status in the organisation etc.
The explanation can be made easier by taking an example of the organisation named CAPCO.
Above stated factors affects the behaviour of an individual at work. Different people behave differently in the organisation even if they are working under same circumstances. So it signifies that the surroundings of an individual at work as well as his personal traits affects his behaviour.(Marshall, 1993)
Leadership means the ability of a person to get work done from other people. Everyone needs a leader to show him the path on which he has to work. Leadership is not only about getting work done but it is about influencing others to do the work in a particular way. It shows how much a person is capable of inspiring and motivating others to do the task well. Different leaders have different styles to lead. Let us have some focus on the leadership styles.(Goldsmith, Baldoni and McArthur, 2010)
Classification of leadership styles:
Comparison of CAPCO leadership style with HSBC
Leadership style: Democratic: Leaders in CAPCO follow the democratic leadership style. As we read that CAPCO has a very open and free organization culture so the employees are allowed to share their views with the leaders. Their involvement in decision making process is also very important.(finance, 2016)
Leadership style: Laissez faire: Unlike CAPCO, HSBC follows the laissez faire leadership style. They want that everyone at HSBC make their own judgment. HSBC provide a principle guideline to its employees based on which, employees can make right decisions.(HSBC.com, 2016)
Democratic style by CAPCO
Laissez faire style by HSBC
Employees share opinions
Employees make decisions
Leaders make decision for employees
Principle guideline has been given to employees to make decisions.
Employees are partially involved in decision making process
Employees are fully involved in decision making process
Difficult to make decision by mutual consent
Decisions are made individually
Organisational theory provides us the basis on which the organisational structure is formed. It gives us the idea of the design of organisational processes and its relation with the external environment. It serves as a guide to managers for mapping out the overall plan of the organisational processes. It acts as the foundation for the management practices. Different organisation follows different theories according to their principles and the management practices.(Zairi and Youssef, 1998)
Below are some of the organisational theories followed by the organisation across the globe:
Classical management theory: The organisation with formal structure works according to this theory. As the name suggests, classical theory believes in traditional approaches of mnagement which includes:
The organisation with scientific approach believes in standardisation. This means the processes in the organisation should be specific and standard in all situations. All the processes from selection to recruitment, everything is done using the scientific tools of management. Proper training and development is given to the employees with the proper division of labour market . It enhances the performance of the employees. Bureaucratic approach deals with the job specific organisations. This approach suggests that the employees with particular skills do the particular job and there is no interaction between the different departments. The organisation with this approach has leaders with autocratic style
Systematic approach deals with the inter-relation between the task and the people. This approach is task oriented as well as people oriented. Along with the focus on increasing productivity, the organisation following this approach relates it with the employee interaction and involvement.(Zairi and Youssef, 1998)
Contingency approach is about situations. Contingency approach is followed by organisation that wants to change with the changes in the environment. The organisation with contingency approach deals with change management and use different approaches according to the different situations.
The choice of management approach to be practiced in the organisation depends upon its culture and organisational structure. Some organisations are task oriented so they practice classical approaches to management and the organisations that are people oriented prefers to practice neo classical approach to management. Below is the comparison between the two organisations with different management approaches. (De Cremer, 2006)
Management approach: contingency: CAPCO practice contingency approach. This organization focuses on change management that suggests that the practices in the organization should be changed according to the situations. CAPCO has change management consultants who guide the employees according to the situations (Capco.com, 2016).
Characteristics of contingency approach:
Management approach: system approach
HSBC is the organisation that focuses on the productivity as well as the human relations. HSBC allows their employees to share their views and opinions regarding the productivity and the processes in the organisation. It signifies that HSBC practice the approach that focuses on employees as well as on the production.(HSBC.com, 2016)
Characteristics of system approach:
Leadership means how an individual control others. Leaders make the path for his followers to follow. Not anybody can be a leader because this is a very important responsibility to carry. Leaders are not only answerable for their own work but are also responsible for the work done by their followers. This is the reason why leaders inspire, train and motivate their employees to work in an efficient way. There is no rulebook for leaders. The style of leadership depends upon the personality of the individual. Leaders are not simply the guides but they are the motivators who influence employees to work and give their best. Different leaders opt different styles of leadership like:(Sevincer, Kluge and Oettingen, 2013)
The choice of the style by the leader has an impact on the motivation in organisation. Different styles have different types of motivation factors. If a person is following democratic leadership style, than he may motivate his followers by providing them a power to contribute more in decision-making process. It depends upon the leader that what motivational factors he is using to motivate his employees. Leaders also consider the employee personal choices also regarding the motivational factors. For example, it is not necessary that the monetary rewards motivate every employee. Sometimes employees have different opinions and choices about the motivation factors. Some enjoy holiday packages and other enjoy insurance policy.(Tracy, 2013)
Leaders either persuade employees or allow them to participate in the processes.
Persuading employees means to influence them regarding the policies and the work that is decided to be done by them without their concern. It is difficult for leaders to persuade employees as the decision may be against their will.(Zairi and Youssef, 1998) Participative leadership is comparatively easy to conduct as the employees are willing to perform better if they are also involved in the decision making process.
Every employee needs to be motivated to perform in a better way. Some of the motivational theories are proposed by the leaders to motivate their employees. Two of them are discussed below:
Many organisation uses Maslow theory to motivate their employees. Every employee has different needs and hence is on the different level of need achievement. The leaders from the organisations applying Maslow theory define a career path to their employees accordingly. This theory is applicable by satisfying the needs of the employees timely. If any of the need of the employees are not satisfied than it may affect his performance in the organisation. For satisfying tall the needs of employees, leaders as well as employees have to work simultaneously. The organisation should provide rewards so that the employees get motivated to perform. The employees should also perform their delegated task on time to achieve such benefits from the organisation. Organisation should provide safe environment to the employees working in the organisation. As the employee is growing in his career, leaders should provide proper training to enhance their knowledge. It will develop the employee as well as the organisation as a whole.
Herzberg theory: This theory includes two factors that are satisfaction and dissatisfaction of the employees. Employees feel satisfied when his basic needs are fulfilled but he needs a motivation to perform even better. Herzberg not only talks about satisfaction but he also talks about the factors which creates a sense of dissatisfaction in employee’s mind. (Luthra, 2015)
Satisfaction factors are also known as motivators that motivates employees. This gives something extra from the basic needs. Rewards, recognition, incentives are some of the forms by which employees can be motivated.
Dissatisfaction or hygiene factors are those whose presence may not affect the employees but the absence of these factors may dissatisfy an employee. Suppose the work condition of an organisation is very open, it will not provide any benefit but its absence may disturb an employee to work properly. (Sevincer, Kluge and Oettingen, 2013)
This theory can be applied in the organisation by considering both the factors. The organisation should keep focus on the importance of both the factors equally. Organisation should observe the factors that are creating an obstacle in the performance of employees and should remove those obstacles. The leaders should conduct a monthly meeting to take feedback from the employees about the customer satisfaction and dissatisfaction level.
Employees need something to motivate them. They perform for the salary but if organisation wants them to perform effectively than they have to provide them with some of the benefits which act as the motivation factor for them. Every team in the organisation has manger who act as a guide for them. Managers are not just the guides but they have to motivate people to work. Managers manage everything from delegating task to motivating employees. (Zairi and Youssef, 1998)
It is very necessary for the managers to understand the importance of motivational theories because it is their duty to motivate employees. They have to treat employees according to their career stage. The position of the employees in their career affects the factors which motivates him to work. So the, managers need to understand this and use the motivational factors accordingly. It is not only the career stage but many other factors also affect the choice of motivational theory to be adopted by managers.
Different individuals have different choices, so manager should also keep in mind the personal choice of an employee before providing him with the benefits. Some individuals work for money and some work for recognition. So managers should consider these factors also.(Luthra, 2015)
Managers should understand their part properly before adopting any motivational theory for his employees. It is very important to introduce the motivational approaches because in this competitive environment, the needs of the employees are changing with very high pace. These needs has to be fulfilled by the managers to retain them in the organisation because if the needs of the employees are not been fulfilled than they may leave the organisation and this let lead to high turnover. The mangers should understand the importance of motivational theory and keep a regular check on the employees by giving them extra benefits in some or the other way. This will motivate employees to work efficiently and to serve the organisation in an efficient manner.
Groups are the collection of people working for a common purpose. The people from different departments or may be from the same department gathers and share their opinions on a particular topic or work on particular project is called teamwork or working in a group. (De Cremer, 2006)
There are broadly two types of group:
Formal groups are made by the leaders in which all the people with particular skills gather and work on same project.
Informal groups are not formed deliberately with a particular intention. They are the social group formed with purpose of informal talks or general communication.(Bukhari and Sharma, 2014)
Formed by leaders
Formed by the group members
For a particular purpose
Purpose is not specified
Member’s will is not considered
Members join according to their will
Dissociate after completion of project
Formed by emotional connection
Working in a group is not an easy task. It has advantages as well as disadvantages associated with it.
The group behaves differently according to their purpose of formation. The groups formed formally are not that much emotionally connected rather than informal groups.
When we take the example of CAPCO, it is an organisation with very open work culture. They accept the practice of working in groups. It is an employee oriented organisation and allow employees to communicate with each other. This in turn results in successful group working as the members of the group are very familiar with each other so can share their views without hesitation. (Capco.com, 2016).
Working in a group may affected by many factors. Some affects in positive way while some other at the same time affects the working in negative way. The factors which affects in positive way are known as promoters and the factors that affects in negative way are known as inhibitors. (Frazer and Oswald, 2009)
The factors that affect the group working can be organisational or personal. The organisational factors may include diversity of workforce that act as a promoter as well as the inhibitor. Diversity promotes the group working by providing different ideas by different people but it may also disrupt the consistency of thoughts and lead to conflicts. The personal factors may include the individual personality. The employees in the group should have that personality of communicating with people otherwise he may feel left out and this in turn affect the group performance. (De Cremer, 2006)
If we consider CAPCO, than the promoters can be the good communication channel of the company. As they have the open culture of working and are so well connected with the other location, so diversity of workforce can be another reason of successful group performance. (Capco.com, 2016).
The inhibitor in the case of CAPCO is that the company allows the employees to take part in decision making process, so this may lead to difference in the opinions. So the leaders may take so much of time taking decision by considering the views of every employee.
Individuals as well as organisations are getting so much of techno-savvy these days. Technology has its impact on every function of the organisation. Finance department is using computers and hi-tech software for accounting, marketing department is using online marketing techniques and HR department is using SAP and other software to update the salaries as well as leaves of the employees.(Frazer and Oswald, 2009)
Some of the technological techniques used by the organisation to enhance its performance are:
If we consider CAPCO, they opted two of the technological methods for enhancing the team functioning.
Cap ln Touch: it is an application by which the employees working at different locations can connect with each other.
LinkedIn: CAPCO uses this medium to communicate the benefits of the associate talent programme.(finance, 2016)
Technology has raised its bars. It is impossible to work without the use of technology to compete with this dynamic environment.
The observation of this study suggests that the organisation structure and culture affects all the processes of the organisation. Both the culture and the structure of the organisation are interlinked with each other. Different organisation has different structure and culture. Both these factors form the foundation of the organisation.
The above unit describes that different leadership styles and management approaches are used by the organisation to conduct the processes in the different functions in the organisation. Management approaches like scientific approach to management, system approach, classical approach etc are adopted by the organisation according to their culture and organisational structure. Different motivational theories are also introduced to motivate employees to perform better for the achievement of goals.
If we talk about the working style of the organisation, it describes that new methods are introduced in the working patterns. One of them is teamwork. Teamwork is very much beneficial for the organisation to enhance its performance. Technology also plays a very vital role in the same.
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