What Is Organisational Behaviour?

Written by James Hirby and Fact Checked by The Law Dictionary Staff  

Organizational Behavior Overview

Organizational behavior seeks to explain the function of complex organizations and predict the outcomes of changes to their components or underlying dynamics. It is most often applied to private-sector businesses, but it can also be used to describe the dynamics of government agencies, religious organizations and even municipalities.

The study of organizational behavior requires a multi-disciplinary approach that draws upon decades' worth of sociological and psychological research. As opposed to human resource management and its related field of study, which focuses on recognizing individual actors' motivations and controlling their behavior accordingly, the academics and business professionals who explore the science of organizational behavior seek to explain the broader outcomes that these actors produce.

Organizational behavior can be broken into two broad categories: "micro-level" dynamics and "macro-level" outcomes. The former concerns the interactions of individuals within small groups tied to a larger organization while the latter concerns the interplay of entire organizations within a sector or industry.

Organisational Behaviour: What You Need to Know

The study of organizational behavior is a by-product of the Industrial Revolution. Although nominal theories of efficiency have existed since ancient times, early-modern economist Adam Smith is generally considered to be the grandfather of organizational behavior. His seminal work on the division of labor within society, which he defined as a large-scale organization, influenced 19th-century business leaders to organize their increasingly complex firms along similar lines.

The activities of two modern social scientists provided the basis for modern organizational theory. Max Weber, a respected German sociologist, observed and codified intra-organizational roles. Later, in the early 20th century, psychologist Kurt Lewin introduced the scientific method to the study of organizational behavior. The results of his studies remain relevant today and have been co-opted and simplified for use by modern managers and bureaucrats.

Organizational behavior is a broad field. In addition to its defining macro-micro dichotomy, it has many additional facets. Of particular importance is the intra-organizational tension between the emotional and physical needs of human employees and the profit-driven emphasis on productivity and efficiency.

This tension spills over into the study of organizational behavior: Sociologists and psychologists tend to trumpet the importance of the former, while economists argue for the primacy of the latter. In recent years, both viewpoints have been vindicated. Humanist management theories have led many private employers to offer more robust benefits packages and sponsor team-building activities proven to boost employee morale and thereby improve efficiency. Meanwhile, the relatively new field of supply chain management has revolutionized the delivery of goods, increasing output dramatically and lowering labor costs in the process.

In recent years, businesses and government agencies have grown so complex that it has become impossible to understand them without using complex mathematics and computer simulations. Methods employed include multiple regression, time series analysis and meta-analysis.

Not surprisingly, many academics who study organizational behavior eventually go into business for themselves. Conversely, many business leaders make a second career out of explaining organizational theory to college students or on the public-lecture circuit.

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