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Unit 3 Organisational and Behavior Assignment
Diploma in Business
Unit Number and Title
Unit 3 Organisational and Behavior
Organisational behaviour is the understanding of behaviour of all the people involved in the organisation and who contribute their effort for the benefit of the organisation. In the present context of organisational behaviour, the importance of the role of the managers and the employees in an organisation have been explained taking into consideration their interaction and behaviour within the company. Analysis has been done on the role of leaders and motivationt heories and relevant theories have been summarized to give support to the understanding.
1.1 Compare and contrast at least any three of the following organisational structures and cultures using a table format to present the differences and similarities
Talking about organisational structure it represents the format of hierarchy about why one is responsible to that of other and displays the level of a person. Organisational structure comprises of various pillars which are required to build the organisation. In addition work specialization is the main element as it helps the employees to become specialized in their respective works and represent their field in an accurate way, however after a certain period of time the workers might feel dissatisfied with their jobs and ultimately their level of motivation will fall down (Schermerhorn, Osborn and Hunt, 2005).
After work specialization, another important key factor of organisational structure is departmentalization which split the jobs into various tasks and then performs them under separate groups. Some useful examples of these groups are customer, geographical, functional process etc. Since different activities in an organisation are controlled by managers organisational structure consists of a SPAN OF CONTROL which provides different methods to handle the work of different sub-ordinates. In the present case we will study about the elements of organisational structure and culture of HSBC bank the following is the similarities and dissimilarities between different organisational structures discussed above.
Very close supervision of the employees
Distance between top and lower level employees
Control is the key
Found in small or medium term organisations
Efficient decision making process
Manager based approach
Less Supervision of employees
Distance between top and lower level employees
Found usually in large organisations
Efficient decision making process
Employees based approach
Low degree of delegation of power
Close relationship between employees and managers
Balance between control and efficiency
Found in small, medium and large organisations
Efficient decision making process
Team based approach
1.2 Relationship between an organisation structure and culture and its impact on the performance of a business
An organisational structure of HSBC is mainly the rules and books of the business. They reflect the aims and objectives of HSBC and the central character of the business and its players. Organisation structure is the base for the designating the roles and responsibilities of the business staffs. It is the role of organisational structure to explain the decision making process to the managers and the employees and make use of their expertise for the benefit of the business (McShane and Glinow, 2014). Organisational structure of HSBC is based in the strategy of the business and are categorised accordingly. Some of the major kinds of structure are as follows:
- Functional structure
- Matrix Structure
- Divisional Structure
Organisational Culture on the other hand is the cultural behaviour of the people of the business organisation which consists of their values, beliefs and interests that they share and (Wilson, 2015). It is this culture that motivates their interaction with each other and with HSBC.
Some of the different types of organisation cultures are as follows:
- Hierarchy – Hierarchy is a formal culture which focuses on the control of the business by the management and is very stable and secure.
- Adhocracy – This is an innovative type of culture whereas the employees are free to experiment on a given project.
- Market – In this market, the competitiveness is very high and is formulated according to the results achieved.
- Clan – This type of organisational culture focuses on the employees of the organisation in terms of freedom of expression and joint effort in the decision making process.
It’s the need of a formal structure that gives rise to organisational efficiency. Groups are assigned different tasks of the business and their efficiency is monitored to get the best out of them (Wilson, 2015). An adverse impact of these is the formation of informal groups in HSBC like interest groups or friendship groups. These hamper the smooth functioning of HSBC. This disturbs the natural organisational structure but constructs an organisation culture. Thus, it can be said that organisational structure defines the organisational culture whereas organisational culture helps in understanding the organisational structure of HSBC.
1.3 Factors influencing the behaviour of an individual at work
An individual at work gives its efforts for the welfare of the organisation. But there are some factors that influence its behaviour in HSBC, such as:
- Behaviour in a work place is influenced by the moral principles and business exercise of the managers or the owners.
- The natural environment of the work place
- The achievement rate of the business
- Attitude of the lower level managers and employees
- Intrinsic factors such as salaries, raises, appreciation, etc.
2.1 Comparison of the effectiveness of different leadership styles in different organisations
Leadership is the direction that employees follow in achieving a certain goal. But leadership is different for different person and different organisation. Some of the most common styles of leadership are the democratic, autocratic and laissez-faire (Malmir, Esfahani and Emami, 2013). Let’s take an example of two of the TIMES 100 (operating in UK) companies and their leadership style.
OVO Energy: OVO Energy is an energy provider company operating in UK and the leadership style followed by the company is authoritative style and participative style. The most reason for this is that the owners involved the managers in the decision making process. The leaders only guided the managers and authorised the work done by them. A leader must be enthusiastic and strong and it must be reflected in its personality. Owners have paid special attention in the recruitment and selection of the employees and as such have retained the best suitable person for the company. The owners then gave authority to the managers to select the subordinates themselves and as such showed trust in their decision. Nonetheless, the owners exert a little amount of autocratic style of leadership to check for detail and improve any issues that arise. This mix style of leadership has showed great success for OVO energy in recent times.
Red Carnation Hotels: Red Carnation hotels are a big company employing more than 10000 employees and as such have a complex leadership style. It has a mix of participative and autocratic leadership style. As Red Carnation is a flat structure of business, its managers give direct orders to the subordinates and they also trust their subordinates. Workers at Red Carnation understand their job profile and as such doesn’t like to be told what to do and what to not. The owners thus wanted to hire efficient that can be a part of the integral process of the business and follow the goals of the business. Both the above mentioned companies follow a different set of leadership styles in their organisation and create an environment where employees are much more progressive and optimistic in nature. But Red Carnation seems to have the better of the two both in employee retention and profit making.
2.2 Organisational theories that underpins the practice of management
Some of the organisational theories that underpin the practice of management are as follows:
- Scientific Management –Red Carnation doesn’t apply this theory in its business organisation because scientific management suggests breaking down the operations of the business into smaller parts. This theory favours productivity but it also creates the issue of de-humanity in the organisation. This theory is somewhat obsolete to modern day business and super-efficient employees that understand their role in an organisation (Bush and Bush, 2003).
- Theory of X and Y –From the above mentioned two companies, it is clearly evident that they follow the theory of Y were employees are very happy and want to work more for the benefit of the company. Theory y explains the willingness of the employees to work more and they are paid accordingly by the management. Management in this situation must trust the employees and their skills. Theory Y helps in building a strong relation between employee and management which ultimately leads to a strong organisation.
- Bureaucracy –This theory was in use by OVO Energy few years ago. It was one of the worse periods for the company was the employees suffered the most under the bureaucracy. It created a situation where the employees were always trying to impress the bosses to gain special favours instead of working for the company. This was considered as an inefficient system of management that hampered the relationship between employee and management.
2.3 Different approaches to management used by different organisations
- Scientific Management Approach – This method is about increasing the efficiency of the employees by dividing the tasks into smaller or simpler parts and the workers will be motivated by increased earnings. Red Carnation was never in favour of this theory as it created a sense of hierarchy between the employees of same level (Robbins and Coulter, 2005).
- Classical Administration Approach – Fayol’s administrative theory mainly focused on the managers and managerial duties. It also gave more respect to the workers by not defining them in terms of money. OVO energy used this theory for a long time but later discarded it for more advanced and user friendly management approaches (Kinicki and Williams, 2008).
- Bureaucratic approach – As mentioned above, this form of management was applied by OVO energy which caused havoc in the business operations of the business. This theory only focused on the managers and directed the employees to follow the orders of the managers (Golding and Currie, 2000).
- Human Relations Approach – Both OVO Energy and Red Carnation use this form of management approach as this method take into consideration the feelings of the workers in building the organisational environment. Both the companies want positive effect in their employees that will ultimately dictate their work.
- Systems Approach – This theory explains an organisation as a system, which is more often an open system which means that it gets affected by its natural environment. Both the companies used this approach to better understand the business environment. It defined proper system that helped both Red Carnation and OVO energy to mitigate any issues and plan for a better tomorrow (Robbins and Coulter, 2005).
- Contingency Approach – This is a more adaptive approach as it tries to find the best suitable way to manage the employees. Both the companies understand the needs of the employees and the organisation itself, which is prone to change. This is the best management way to deal with this situation.
Outline and define Maslow’s 5 Hierarchy of Needs?
Abraham Maslow defined the “hierarchy of needs” theory in psychology which explains the different stages of needs a person moves.
- Physiological Needs– According to Maslow, these are the basic needs of a human like food, water, home, pleasure, etc.
- Safety Needs– These include the safety and security from personal life, money, health, accidents and also protection from law and order.
- Love and belongingness Needs– Needs of love and affection from family, friends and close associates which also include friendship, love, intimacy, etc.
- Esteem Needs– Esteem needs of a person include individual success, achievement independence, prestige, self-respect, etc. that gives a person respect in front of others.
- Self-Actualization Needs– These are needs that mean mastery of personal potential, personal growth and self-fulfilment (Adair, 2006).
Under Maslow’stheorywhat can chronic frustration of a person’s needs lead to:
Chronic frustration is the situation where a person’s non satisfaction of the needs can lead to adverse issues. In this scenario, according to Maslow’s theory, chronic frustration can lead to psychopathological issues. Now, psychopathological issues are issues that relate to mental disorders that may affect a person’s social, psychological and biological understanding (Adair, 2006). A person may not recognise need of safety of itself and others, their sense of essential needs will reduce, it may lose appetite, leave all social relations and live life without any sense of direction and self-actualisation.
Define and outline McGregor’s theory X and Y:
Douglas McGregor’s human motivation theory of X and Y is a contrasting theory that explains two different theories of employees motivation.
Theory Xis based in Maslow’s lower order needs where an employee is usually de-motivated to work and must be pushed by the management to get things done. This is a negative perspective of employee motivation and behaviour.
Theory Yis based on Maslow’s higher order needs and is a positive view towards employee motivation and behaviour. Theory Y states an enthusiastic employee who is happy to work, takes responsibilities and is creative in its skills and enjoys working (Hersey, Blanchard and Johnson, 2001).
Outline Herzberg’s Hygiene theory:
Herzberg’s Hygiene theory of motivation states certain positive and negative factors that arise in an organisation and causes job satisfaction or dissatisfaction in an employee. Hygiene factors include the environmental factors such as job security, salary, supervision, working conditions, company policy, etc. that may affect an employee.
List Herzberg’s 6 motivations:
Herzberg’s 6 motivations are as follows:
- Recognition and status from managers and management
- Growth and promotional opportunities
- Meaning full and challenging work
- Reward of achievement from the job
- Own responsibility of work
- Advancement opportunities
Outline and define Vroom’s expectancy theory
Victor H. Vroom’s “Expectancy theory” states that an individual will choose to behave in a way that is the best according to a certain outcome and will suppress other behaviours in them over the selected behaviour. Organisations looking to motivate employees need to ensure that all 3 of Valence, Instrumentality and Expectancy must be high or positive. If only two or one of these is achieved, employees will not be motivated.
Why should managers know about motivation?
One of the responsibilities of managers is to get things done by including and motivating employees. Managers must choose the right employee for the right job and get the work done in the specified time. On that context, managers must understand the role of motivation for an employee and how to use motivation for the benefit of the organisation (Furnham, 2013).
According to (Tracy, 2013), motivation is a psychological process that involves listening to a person that you value the most and respect. Employees only get motivated when they listen to great leaders or managers. An organisation wants to achieve its targets and employees re the force behind achieving the said targets and objectives. It is the role of the manager to effectively motivate its employees. It is not always that a business organisation achieves its targets and it is only because of de-motivated employees and in that sense it is the manager that must motivate the employees by his cognitive skills of leadership and motivation.
As depicted from the above mentioned explanations, organisation behaviour is an obligatory tool in an organisation. It is essential to increase the adeptness of an organisation in the modern world. Organisational behaviour rules the concept of group and group effort and contributes to an effective business model. It is an effective medium for the employee to understand the rules, standard and culture of an organisation. Only then an organisation will move towards a better tomorrow that rewards its employees appropriately.
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Furnham, A. (2013). The Secrets of Motivation. Cork: BookBaby.
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