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Behavioral Dynamics in Organizational Settings
Business Essentials · Chapter 7: Organizational Design and BehaviorSection 7.4 · lesson 39 of 10514 min · free with a free account
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In this lesson
Individuals, groups, and the structures that shape what they do.
- Describe the 3 levels of analysis in organizational behavior
- Explain group development, norms, and cohesion
- Recognize groupthink and the 3 types of team conflict
- Explain how structure and culture shape behavior
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Organizational Design and Behavior
Behavioral Dynamics in Organizational Settings
Why do capable people sometimes behave in ways that seem irrational at work? This section argues that behavior is often a rational response to conditions. We'll look at behavior at three levels, the individual, the group, and the organization. We'll cover perception, attitudes, and the unwritten deal between employee and employer. Then how groups develop, and how norms and cohesion steer them. We'll study groupthink, and three kinds of team conflict. And we'll see how structure and culture shape behavior, often more than attitude does. The practical lesson is that changing conditions usually works better than exhorting people.
Organizational Behavior
3 Levels, 3 Kinds of Explanation
Organizational behavior is the study of how people act in organizations. Its purpose is practical. It helps managers understand, predict, and influence what happens at work. Its questions can be asked at three levels, and the level you choose decides what counts as an explanation. At the individual level, the unit is one person. Why has a new hire who was enthusiastic in month one become withdrawn by month four? At the group level, the unit is a team. Why does one sales team share leads freely, while a similar team hoards them? At the organizational level, the unit is the whole organization. Why do one company's employees report their own mistakes, while another company's conceal them? A single event can often be examined at all three levels. Much of a manager's skill lies in noticing which level actually holds the cause. Motivation and leadership get their own chapters, so here we only refer to them.
The Individual Level
Perception and Attitudes
Start with the individual, and with perception. Perception is how people select, organize, and interpret information, to give it meaning. It matters because people respond to what they perceive, not to what an observer would call the objective situation. Two employees can get the same feedback. One perceives help, the other perceives criticism. And each acts on the version they perceived. Attitudes are evaluations, favorable or unfavorable, of objects, people, or events. Job satisfaction is a positive or negative feeling about one's job, based on evaluating its characteristics. Engagement is different. It's involvement in, enthusiasm for, and commitment to the work itself. The two are related, but distinct. An employee can be satisfied with pay and hours, and still be disengaged from the work.
Unwritten Deals, Real Teams
The Psychological Contract, and What Makes a Team
Next, the psychological contract. It's the unwritten set of mutual expectations between an employee and an employer, about what each will give and receive. It's separate from the written employment agreement. An employee may believe steady effort will bring development, or that loyalty in a hard year will be remembered. No document says so. But the expectation is real. When the contract is broken, research has generally found that trust falls, and commitment weakens. Employees give less discretionary effort, and some leave. The employer's view may differ from the employee's, and neither may realize it until it's violated. That's why managers are cautioned against informal promises they can't keep. Now, groups and teams. A group is two or more people who interact and influence one another toward a goal. A team is a group whose members are interdependent, share a goal, and hold themselves mutually accountable. The difference has a practical edge. Calling people a team doesn't create interdependence. If each person's work stands alone, and each is judged only individually, it's a group, whatever its label.
Figure 7.4.1
5 Stages of Group Development
A widely used model of group development was proposed by Bruce Tuckman in nineteen sixty-five. A fifth stage was added in later work. In forming, members get acquainted and test what's expected. The manager clarifies purpose, roles, and ground rules. In storming, members contest roles, methods, and influence. The manager brings conflict into the open, and keeps it on the work. In norming, the group settles on shared expectations. The manager reinforces the productive ones. In performing, the group works as a unit. The manager protects it, delegates, and keeps goals current. In adjourning, the group prepares to disband. The manager recognizes contributions, and captures what was learned. These are tendencies, not a schedule. Groups may skip stages, linger, or cycle back. The most important observation concerns storming. A manager uncomfortable with disagreement may suppress it, by insisting on politeness, or deciding alone. But suppression doesn't remove the disputes. It drives them underground. They resurface as passive resistance, side conversations, and missed handoffs. And the group can't move on. Performance typically dips at storming. That dip is normal, not a sign of failure. Groups also regress. A new member, a changed goal, or a new leader can send a performing team back to storming. Managers should expect that, rather than treat it as a failure of the original team-building.
Norms and Cohesion
The Real Rules, and How Strongly They Bind
Norms are the shared, usually unwritten standards of behavior a group accepts as appropriate. They're the group's actual rules, whatever the handbook says. And they form without being stated. Early behavior sets precedent, so the way the first few meetings ran becomes the way meetings run. A critical event teaches everyone what to avoid, like a colleague embarrassed for raising a problem. Members also bring expectations from previous groups. Occasionally, someone states a rule directly. Norms cover punctuality, how much disagreement is acceptable, whether people help each other, and how much output is enough. Cohesion is how far members are attracted to one another, and motivated to stay in the group. Social cohesion is the strength of personal bonds. Task cohesion is shared commitment to the group's goal. Research reviews generally find that task cohesion relates to performance more reliably than social cohesion. And the relationship depends on norms. A cohesive group with productive norms tends to outperform a less cohesive one. But a cohesive group with anti-productive norms can do worse than a loose group, because strong bonds enforce the low standard. In short, cohesion amplifies whatever the norms are.
Groupthink
When Agreement Beats Appraisal
Groupthink was described by Irving Janis in nineteen seventy-two. It's a pattern where the desire for agreement overrides a realistic appraisal of alternatives. The group reaches a poor decision that its members wouldn't have made individually. Janis proposed several antecedent conditions. High cohesion. Insulation from outside views. And directive leadership, where the leader states a preference early. Plus the absence of any methodical procedure for searching for and appraising alternatives. The symptoms fall into three groups. First, overestimating the group. A belief that it can't fail, and confidence in its own morality. Second, closed-mindedness. Warning signs are rationalized away, and outsiders who disagree are dismissed. Third, pressure toward uniformity. Members with doubts censor themselves. That produces an illusion of unanimity. And anyone who does dissent faces direct pressure.
Groupthink in Practice
A Useful Account, Not a Law
The evidence on groupthink needs careful handling. Janis built the model largely from studies of historical decisions. Later laboratory and field research supports some parts more consistently than others. Directive leadership, and the absence of structured procedures, hold up well. The effect of cohesion alone, less so. So treat it as a useful account of how conditions combine to produce poor decisions. Not as a law. The countermeasures follow directly from the antecedents. The leader can withhold a preference until others have spoken. One or more members can be assigned to test the proposal critically. Outside experts or reviewers can be invited in. The group can split into subgroups that develop alternatives separately. And a second meeting can reconsider the first agreement. Each one works by changing a condition that produces quick unanimity.
Table 7.4.1
3 Types of Team Conflict
Conflict is a process where one party perceives that another has opposed, or will oppose, something it cares about. Three types behave differently. Task conflict is about the content of the work. Goals, ideas, and how to read the facts. Say two analysts disagree over whether a sales dip is a real trend or a one-time event. The findings are mixed. It can improve decisions when moderate and trust is high. Otherwise it often adds little. Process conflict is about how the work gets done. Who's responsible, how resources are allocated, and in what order. When it's about who does what, it's generally harmful. It wastes time and breeds resentment. Clarify roles in writing. Relationship conflict is personal friction, like irritation, distrust, or dislike. Research consistently links it to lower satisfaction and weaker performance. Address it early and privately. Now the crucial practical problem. Task conflict can convert into relationship conflict. A dispute about a forecast becomes a dispute about competence when one side feels personally attacked. That's more likely when trust is low, when challenges judge the person, and when the audience is public. So managers must do two things at once. Welcome disagreement about ideas, and protect the conditions that keep it impersonal.
How Structure Shapes Behavior
The Silo Effect
Behavior at work is often explained by attitude. Departments don't cooperate because they're uncooperative. A structural explanation is usually more accurate, and more useful. The silo effect is the tendency of units to focus on their own goals, and communicate poorly with other units. Structure produces it directly. When people are grouped by function and measured by their function's performance, they develop functional loyalty. Their supervisor, evaluation, colleagues, and promotion prospects all sit inside the function. So a production group measured on cost per unit will, rationally, resist a design change that raises unit cost. It resists even if the change would raise the organization's overall revenue. Telling that group to cooperate more accomplishes little, because the structure rewards the behavior. What addresses the cause? Changing the measures, adding shared goals, creating lateral links, and rotating people among functions.
Organizational Culture
What Is Rewarded, Not What Is Proclaimed
Organizational culture is the system of shared assumptions, values, and beliefs that governs how people behave. It's usually described at three levels, following a model by Edgar Schein. Artifacts are the visible features. Dress code, office layout, ceremonies, and language. Espoused values are what the organization says it holds, in mission statements and speeches. Basic underlying assumptions are the taken-for-granted beliefs that actually guide behavior. They're seldom examined. The most useful point is the gap between espoused values and what's actually rewarded. A company may say it values candor. But last year, the manager who reported a serious problem was passed over for promotion, and everyone noticed. Employees respond to what's rewarded, not what's proclaimed. So the real culture is found in decisions about who's promoted, who's corrected, and who's quietly ignored.
Case Vignette (Composite)
The 15-Minute Decision
Here's a composite case, with a fictional company and people. Daniela is chief executive of Cobalt Ridge Logistics. She proposes buying a competitor's network of regional depots. She opens the meeting by saying it's clearly the right move, and the price is favorable. Within fifteen minutes, all six executives have endorsed it, and the meeting turns to timing. Kwame, the finance officer, had privately estimated that integration would cost far more than planned. He said nothing. Daniela could accept the unanimity as confirmation. She could hold a second meeting, not speak first, and assign one executive to argue against the purchase. Or she could commission an outside review of integration costs. The offer expires in three weeks, so the trade-off is speed against the risk of a poor purchase. The case turns on directive leadership, a leader stating a preference at the start. The team is cohesive, with no procedure for testing proposals. So her opening view functioned as the decision. Unanimity in fifteen minutes is a symptom, not evidence of quality. The sound decision is to reopen with the leader silent, invite Kwame's estimate, and decide within the three weeks.
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