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What Is Organizational Behavior?

When you were younger, did you ever spend time watching an ant colony? Were you intrigued by the organization of labor, division of tasks and interaction between individual ants? It is remarkable how organizations behave, no matter the size or even the species.

Organizational behavior is a riveting subject, whether it involves examining ant colonies, buzzards’ nests or business organizations. Of course, our greatest fascination is with the human species and how we collectively organize for work. For this reason, we want to call your attention to one of the most riveting courses in the online MBA program at the University of Texas at Tyler.

Our Organizational Behavior course covers the issues managers face when trying to lead people and organizational units to achieve corporate objectives. But what exactly is organizational behavior (OB), and why is it an important area of study within an MBA program?

Definitions

We talked to our professors and it seems no singular definition of organizational behavior suffices to introduce all of its important aspects, but these definitions from two organizations bring the scope of this study into view:

Investopedia: OB is the study of the way people interact within groups. Normally this study is applied in an attempt to create more efficient business organizations. The central idea of the study of organizational behavior is that a scientific approach can be applied to the management of workers. Organizational behavior theories are used for human resource purposes to maximize the output from individual group members.

Boundless: OB is the field of study that investigates how organizational structures affect behavior within organizations. It studies organizations from multiple viewpoints, including behavior within the organization and in relation to other organizations.

A Brief History

Organizational behavior has been a field of academic study since the 1970s, when it was recognized by the American Psychological Association. The timeline of events leading up to this milestone is marked by a variety of corporate experiments that were undertaken to understand organizational dynamics and the impacts of changes to particular variables. The earliest experiment occurred in the late 1920s, when the Hawthorne Electric Company studied how changes in environment and design of the workplace affected employee productivity.

Other studies over the years examined how to increase employee productivity, the limits of interchangeability of employees, logistics management, and personality and team fit. This work led to breakthroughs like the contingency theory, which asserts that there is no one right way to organize a company, lead a company or make decisions. Bounded rationality is another, asserting that the rationality of individuals is limited by the information they have, the cognitive limitations of their minds, and the finite amount of time they have to make a decision. These ideas have implications far beyond business; they are psychological and sociological as well, revealing great insights into the human mind.

The Influence of OB in Business

With a proper understanding of the machinery of organizational behavior, a manager can influence a variety of factors by pulling the right levers. Changes to all of the influences on OB, from organizational structure to employee policies, can impact the company in countless ways. Managers can use this knowledge to improve employee performance, decision-making and even the company culture.

For instance, leaders can maximize employee performance by implementing the most effective forms of motivation. Transparent rewards, applied equitably, can inspire employees to work harder and reach more difficult goals. Managers can affect the level of risk-taking and innovation in employee decision-making by altering the organizational influences on these factors.

Finally, we hear so much about the importance of corporate culture in attracting and retaining top talent. In order to have a desirable culture that encourages employees to contribute their best ideas, leaders have to know what OB tools to use.

Once you discover the impact of organizational behavior, there is no limit to how you can apply it in your career to benefit your employers and advance through the leadership ranks.

Learn more about UT Tyler’s online MBA programs.


Sources:

Houston Chronicle: Impacts of Organizational Behavior in Business

Boundless: Organizational Behavior Defined

Investopedia: Organizational Behavior Defined


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