16 Organisational Behaviour — Significance and Theories

16.1 What is Organisational Behaviour?

Organisational Behaviour (OB) is the systematic study of what people do in organisations and how their behaviour affects the organisation’s performance. The classroom shorthand: OB studies individuals, groups, and structure in their effect on behaviour at work — and uses that knowledge to make organisations work better.

Stephen Robbins and Timothy Judge define OB as “a field of study that investigates the impact that individuals, groups, and structure have on behavior within organizations, for the purpose of applying such knowledge toward improving an organization’s effectiveness”. Fred Luthans is more emphatic about its scientific footing: OB is “the understanding, prediction and management of human behaviour in organisations”.

Working Definitions of OB

Author	Definition	Foregrounds
Robbins & Judge	“A field of study investigating the impact of individuals, groups and structure on behaviour within organisations.”	Three units of analysis
Fred Luthans	“The understanding, prediction and management of human behaviour in organisations.”	Scientific aim
Keith Davis	“The study and application of knowledge about how people act within organisations.”	Application
Stephen Robbins	“A systematic study of the actions and attitudes that people exhibit within organisations.”	Actions + attitudes
L.M. Prasad	“A study of human behaviour in organisational setting, of the interface between human behaviour and the organisation, and of the organisation itself.”	Two-way interface

16.1.1 Three Units of Analysis

OB’s three levels

Level	Unit	Topics covered
Individual	Single person	Personality, perception, attitudes, motivation, learning, emotions
Group	Two or more interacting	Group dynamics, teams, leadership, communication, conflict, power
Organisation system	Whole system	Structure, culture, climate, change, HR systems, justice

flowchart TB
  I[Individual level<br/>Personality · Perception · Motivation] --> G[Group level<br/>Leadership · Teams · Conflict]
  G --> O[Organisation level<br/>Structure · Culture · Change]
    classDef default fill:#003366,color:#ffffff,stroke:#ffcc00,stroke-width:3px,rx:10px,ry:10px;

16.2 Nature / Characteristics of OB

Eight characteristics of OB

Separate field of study — interdisciplinary but identifiable.
Multi-level — individual, group, organisation.
Action-oriented / applied — aims at improving practice, not just describing it.
Both science and art — empirical research + judgement in application.
Human-tool — humans are both the subject and means.
Normative and value-laden — explicit about outcomes (productivity, satisfaction, well-being).
Contingency-based — “it depends” — no universal answer.
Interdisciplinary — borrows from psychology, sociology, social psychology, anthropology, political science.

16.3 Contributing Disciplines

Disciplines that built OB

Discipline	Contribution to OB	Unit
Psychology	Personality, perception, learning, motivation, emotions, attitudes, training	Individual
Sociology	Groups, formal organisation theory, bureaucracy, power, communication, change	Group + Organisation
Social psychology	Attitude change, communication, group decision-making, conflict	Group
Anthropology	Comparative cultures, values, organisational culture, work environment	Organisation
Political science	Conflict, intra-organisational politics, power	Group + Organisation
Economics	Decision-making (utility, rationality), incentive design	Individual + Organisation

16.4 Why OB Matters — Goals and Significance

Four goals of OB (Luthans)

Describe — systematically how people behave in organisations.
Understand — why people behave the way they do.
Predict — future behaviour.
Control / Manage — channel behaviour toward organisational ends.

Why OB matters in practice

People skills — most managerial work is mediated through people.
Employee engagement — engaged workforces are more productive.
Diversity management — workforces are more demographically and culturally varied.
Quality and productivity — depend on motivation and team work.
Innovation — comes from teams and creative climate.
Coping with change — turbulent environments demand OD competence.
Ethics and well-being — modern OB tracks both bottom line and employee well-being.

16.5 Evolution of OB — Three Waves

Three waves leading to modern OB

Wave	Period	Pre-occupation	Representatives
Classical / Scientific Management	1880s–1920s	Efficiency of the worker	Taylor, Gilbreths, Gantt, Fayol, Weber
Neo-classical / Human Relations	1920s–1950s	The social and emotional worker	Mayo (Hawthorne), Maslow, McGregor, Herzberg, Likert, Argyris
Modern / Behavioural Science	1950s–present	Systems, contingency, behavioural rigour	Lewin, Schein, Robbins, Luthans, Bandura

16.5.1 Pre-classical contributors

Robert Owen (early 19th c. Scottish mill owner, the “Father of Personnel Management”) and Charles Babbage (1832, On the Economy of Machinery and Manufactures) advocated humane work conditions long before formal OB.

16.5.2 Classical wave — efficiency as the lens

Treated humans as economic beings responding only to monetary incentives. See Topic 1 for the full Taylor / Fayol / Weber treatment.

16.5.3 Hawthorne Studies (1924–32) — birth of OB

The Hawthorne studies at Western Electric’s Chicago plant — led by Elton Mayo, F.J. Roethlisberger and W.J. Dickson of Harvard — discovered that attention and social belonging drive productivity more than physical conditions. Four phases:

The four Hawthorne experiments

Phase	What was varied	Key finding
Illumination (1924–27)	Lighting	Output rose regardless — Hawthorne Effect
Relay Assembly Test Room (1927–32)	Breaks, hours	Output rose under attention
Mass Interview Programme (1928–30)	21 000+ employee interviews	Workers want to be heard
Bank Wiring Observation Room (1931–32)	Naturalistic observation	Informal group norms restrict output

The Hawthorne Effect

The famous side-effect: behaviour changes when one knows one is being observed. The interpretation of the Hawthorne data has been challenged (Henry Landsberger 1958; Stephen Jones 1992) but the idea of human-relations management traces back here.

16.5.4 Behavioural-science wave — modern OB anchors

Behavioural anchors — at a glance

Theorist	Year	Core idea
Kurt Lewin	1947	Field theory; force-field analysis; unfreeze-change-refreeze; group dynamics; action research
Abraham Maslow	1943	Hierarchy of needs — physiological → safety → social → esteem → self-actualisation
Douglas McGregor	1960	Theory X (lazy worker) vs Theory Y (responsible worker)
Frederick Herzberg	1959	Two-factor theory — hygiene factors vs motivators
Rensis Likert	1961	Four systems of management: Exploitative-Authoritative · Benevolent-Authoritative · Consultative · Participative
Chris Argyris	1957	Immaturity-maturity continuum; mix model
B.F. Skinner	1953	Operant conditioning, reinforcement
Albert Bandura	1977	Social learning theory; self-efficacy
Edgar Schein	1985	Organisational culture three-level model
Fred Fiedler	1967	Contingency model of leadership
Stephen Robbins	1979+	Modern textbook framework

16.6 Models of OB — Davis’s Five Models

Keith Davis (Human Behavior at Work, 1977) classified the underlying managerial assumptions about employees into five models that have evolved over time.

Davis’s five OB models

Model	Manager’s view	Employee response	Era
Autocratic	Authority — you do as I say	Dependence, obedience	Industrial revolution
Custodial	Money / benefits — employees feel secure	Passive cooperation, dependence on the firm	1920s onward — welfare era
Supportive	Leadership / supportive boss	Job satisfaction, awakened drive	1960s onward
Collegial	Partnership, team	Self-discipline, responsible behaviour	Knowledge-worker era
System	Trust + community + meaning	Psychological ownership, passion	21st century

Davis’s model evolves from money (custodial) → leadership (supportive) → partnership (collegial) → community and meaning (system).

16.7 Theories Underlying OB

OB synthesises across four families of theory:

Four families of OB theories

Family	Question	Anchor theories
Personality theories	Who is the person?	Trait theories (Big Five, Allport, Cattell 16PF), Type theories (Jung-MBTI), Psychoanalytic (Freud), Self-concept (Rogers)
Motivation theories	What drives behaviour?	Maslow, Herzberg, McClelland, ERG (Alderfer), Vroom, Adams, Locke-Latham
Learning theories	How do people change?	Classical (Pavlov), Operant (Skinner), Social/Observational (Bandura), Cognitive (Tolman)
Leadership theories	How do leaders influence?	Trait, Behavioural (Ohio-Michigan; Blake-Mouton), Contingency (Fiedler, House, Hersey-Blanchard), Transformational (Bass, Burns)

The detailed treatment of these theories belongs to Topics 16 (individual behaviour), 17 (group behaviour) and the Strategic HRM chapter.

16.8 Approaches to OB

Six approaches to OB

Approach	Lens	Anchor
Human Resource (Supportive) Approach	People are assets, not costs	McGregor’s Theory Y; Likert system 4
Contingency Approach	“It depends” — no universal answer	Fiedler, Lawrence-Lorsch
Systems Approach	Organisation as an open system with sub-systems	Bertalanffy, Katz-Kahn
Productivity Approach	Efficiency + effectiveness + employee well-being	Modern OB
Interdisciplinary Approach	Borrows from many disciplines	Robbins, Luthans
Inter-actionist Approach	Behaviour = f(Person × Environment)	Lewin’s B = f(P, E)

Lewin’s Equation

B = f(P, E) — Behaviour is a function of the Person and her Environment. Kurt Lewin (1936) — the foundation of modern OB.

16.9 Limitations of OB

Five limitations of OB

Behavioural bias — over-emphasis on humans may de-emphasise other factors.
Diminishing returns — too much “human relations” can hurt productivity.
Manipulative use — OB knowledge can be used to manipulate employees.
Cultural relativity — Western OB theories may not transfer to Asian or African settings.
Difficulty of measurement — behaviour is harder to measure than output.

16.10 Indian Context — Indian Psychology in OB

Indian researchers — Udai Pareek (HRD movement), Rao T.V. (HRD audit), S.K. Chakraborty (Indian ethos), P.N. Khandwalla (humane organisations) — have contributed unique Indian frameworks:

Indian OB contributors

Udai Pareek — FIRO-B India version, MAO-C, integrated HRD systems; called the Father of HRD in India.
T.V. Rao — HRD audit, 360-degree feedback in India, HRD Score Card.
S.K. Chakraborty — Indian Ethos in Management; values, integral management.
P.N. Khandwalla — Pioneering Innovative Management, humane organisation.
Amartya Sen / Martha Nussbaum — Capability approach feeding into well-being literature.

16.11 Practice Questions

Q 01 Definition Easy

Organisational Behaviour studies the impact of which three units on behaviour at work?

AIndividuals, Groups, Structure
BMarkets, Money, Management
CInputs, Throughputs, Outputs
DStrategy, Structure, Systems

View solution

Correct Option: A

Robbins-Judge's classic definition: Individuals, Groups, Structure.

Q 02 Goals Medium

Fred Luthans's four goals of OB are:

ADescribe, Understand, Predict, Control
BPlan, Organise, Direct, Control
CHire, Train, Retain, Promote
DDefine, Discuss, Decide, Deliver

View solution

Correct Option: A

Luthans's four goals: Describe · Understand · Predict · Control.

Q 03 Disciplines Medium

The discipline that contributes most to OB at the *individual* level is:

ASociology
BAnthropology
CPsychology
DPolitical science

View solution

Correct Option: C

Psychology contributes most at the individual level — personality, perception, learning, motivation, emotions.

Q 04 Lewin Medium

Kurt Lewin's equation B = f(P, E) means behaviour is a function of:

APower and Experience
BPerson and Environment
CProductivity and Effort
DPersonality and Emotion

View solution

Correct Option: B

Lewin (1936): Behaviour = f(Person, Environment) — the founding equation of modern OB.

Q 05 Hawthorne Easy

The "Hawthorne Effect" refers to:

AProductivity falling with longer hours
BBehaviour changing when subjects know they are being observed
CWages rising with experience
DStress falling with rest periods

View solution

Correct Option: B

The Hawthorne Effect — output rose in both test and control groups, suggesting behaviour changes under observation — independent of the variable being manipulated.

Q 06 Hawthorne Medium

Hawthorne's *Bank Wiring Observation Room* experiment revealed:

AEffect of lighting on output
BEffect of breaks and refreshments on output
CInformal group norms restricting output
DEffect of wage incentives

View solution

Correct Option: C

The Bank Wiring Room (1931–32) used naturalistic observation and found informal group norms set the pace. Workers above and below the norm were sanctioned by peers.

Q 07 Davis Models Hard

Keith Davis's five OB models — in chronological order of dominance — are:

AAutocratic → Custodial → Supportive → Collegial → System
BSupportive → Autocratic → System → Custodial → Collegial
CSystem → Collegial → Supportive → Custodial → Autocratic
DAutocratic → Supportive → Collegial → Custodial → System

View solution

Correct Option: A

Davis's chronological sequence: Autocratic → Custodial → Supportive → Collegial → System.

Q 08 Behavioural anchors Medium

Match the theorist with the contribution:

(i)	Maslow	(a)	Theory X and Y
(ii)	McGregor	(b)	Two-factor theory
(iii)	Herzberg	(c)	Hierarchy of needs
(iv)	Likert	(d)	Four systems of management

A(i)-(c), (ii)-(a), (iii)-(b), (iv)-(d)
B(i)-(a), (ii)-(b), (iii)-(c), (iv)-(d)
C(i)-(d), (ii)-(c), (iii)-(b), (iv)-(a)
D(i)-(b), (ii)-(d), (iii)-(a), (iv)-(c)

View solution

Correct Option: A

Maslow — Hierarchy of Needs; McGregor — Theory X/Y; Herzberg — Two-factor; Likert — Four systems.

Q 09 Lewin model Medium

Kurt Lewin's three-step model of change is:

APlan – Do – Check
BUnfreeze – Change – Refreeze
CStorm – Norm – Perform
DAwareness – Desire – Knowledge

View solution

Correct Option: B

Lewin's 1947 model — Unfreeze → Change → Refreeze.

Q 10 Self-efficacy Hard

Social learning theory and the concept of *self-efficacy* are most associated with:

AB.F. Skinner
BAlbert Bandura
CIvan Pavlov
DEdward Tolman

View solution

Correct Option: B

Albert Bandura's Social Learning Theory (1977) and his concept of *self-efficacy* — the belief in one's ability to perform.

Q 11 Pavlov-Skinner Medium

*Classical conditioning* and *operant conditioning* are associated respectively with:

APavlov and Skinner
BSkinner and Pavlov
CBandura and Tolman
DFreud and Jung

View solution

Correct Option: A

Ivan Pavlov — classical conditioning (dog salivation). B.F. Skinner — operant conditioning (reinforcement of voluntary behaviour).

Q 12 Likert systems Hard

Rensis Likert's four systems of management range from:

AExploitative-Authoritative to Participative
BBureaucratic to Adhocratic
CTheory X to Theory Y
DAutocratic to Laissez-faire

View solution

Correct Option: A

Likert (1961) — Exploitative-Authoritative → Benevolent-Authoritative → Consultative → Participative (System 4).

Q 13 Systems Medium

An organisation viewed as taking inputs, transforming them, and exchanging outputs with its environment is described by which approach?

AContingency approach
BSystems approach
CBureaucratic approach
DQuantitative approach

View solution

Correct Option: B

The Systems approach (Bertalanffy, Katz-Kahn) views the organisation as an open input-throughput-output-feedback system.

Q 14 Indian OB Medium

In India, the person often called the *Father of HRD* is:

AUdai Pareek
BT.V. Rao
CS.K. Chakraborty
DP.N. Khandwalla

View solution

Correct Option: A

Udai Pareek is the Father of HRD in India; collaborated with T.V. Rao on the L&T HRD framework (1975), which became a template for Indian HRD systems.

Q 15 Hawthorne plant Hard

The Hawthorne studies were conducted at the Hawthorne Works of:

AGeneral Electric
BWestern Electric Company, Chicago
CFord Motor Company
DBethlehem Steel

View solution

Correct Option: B

Western Electric Company, Hawthorne plant, Chicago. Bethlehem Steel is the Taylor scientific-management story.

Q 16 Owen Hard

The "Father of Personnel Management", a 19th-century Scottish mill owner who advocated humane work conditions, is:

ARobert Owen
BCharles Babbage
CFrederick Taylor
DHenri Fayol

View solution

Correct Option: A

Robert Owen — New Lanark mill (early 1800s). Charles Babbage (1832) wrote on the economy of machinery.

Q 17 Davis Model evolution Medium

In Davis's *Custodial* model of OB, employees primarily depend on:

AThe boss
BThe organisation (security and benefits)
CTheir team
DThemselves

View solution

Correct Option: B

In the Custodial model, the manager rewards with money and benefits; employees feel secure but become passively dependent on the *organisation*.

Q 18 Approach Medium

The OB approach holding that "there is no one best way — the right action depends on the situation" is:

AHuman resource approach
BContingency approach
CProductivity approach
DSystems approach

View solution

Correct Option: B

The contingency approach (Fiedler, Lawrence-Lorsch, Hersey-Blanchard) — fit between action and situation.

Q 19 Mayo Easy

The Hawthorne studies are most directly associated with the rise of:

AScientific management
BHuman relations approach
CBureaucratic management
DQuantitative approach

View solution

Correct Option: B

Mayo's interpretation of the 1924–32 studies launched the human relations movement, the precursor to modern OB.

Q 20 Theory Y Medium

McGregor's *Theory Y* assumes that:

AWorkers dislike work and must be coerced
BWorkers seek responsibility and self-direction
CWorkers obey only out of self-interest
DWorkers prefer hierarchy

View solution

Correct Option: B

Theory Y — McGregor (1960) — assumes work is as natural as play; workers seek and accept responsibility and exercise self-direction. Theory X is the pessimistic counterpart.

16.11.1 Advanced Format Questions

AR 1Assertion-ReasonHard

A: Hawthorne studies established the importance of social factors at work.
R: Productivity rose due to the attention received, not lighting changes.

ABoth true; R explains A
BBoth true; R does not explain A
CA true, R false
DA false, R true

View solution

Correct Option: A

AR 2Assertion-ReasonMedium

A: OB is multidisciplinary.
R: It draws from psychology, sociology, anthropology and political science.

ABoth true; R explains A
BBoth true; R does not explain A
CA true, R false
DA false, R true

View solution

Correct Option: A

S 1Statement-basedMedium

OB levels: (i) Individual. (ii) Group. (iii) Organisational. (iv) Inter-organisational.

AAll four
B(i), (ii), (iii) only
C(i) and (ii) only
D(iii) only

View solution

Correct Option: B

Standard OB has 3 levels — individual, group, organisational.

S 2Statement-basedHard

OB foundational theorists: (i) Maslow. (ii) Herzberg. (iii) McGregor. (iv) Argyris.

AAll four
B(i) and (ii) only
C(iii) and (iv) only
D(i), (ii), (iii) only

View solution

Correct Option: A

16.12 Quick Recall

Quick recall

OB = systematic study of human behaviour in organisations (Robbins-Judge). Three units: Individual · Group · Organisation.
Luthans’s four goals: Describe · Understand · Predict · Control.
Lewin equation: B = f(P, E).
Contributing disciplines: Psychology (individual) · Sociology + Social Psych + Political Science (group/organisation) · Anthropology (culture) · Economics.
Three waves: Classical (Taylor/Fayol/Weber — efficiency) → Neo-classical (Mayo/Maslow/McGregor — human relations) → Modern (Lewin, Schein, Bandura, Robbins).
Hawthorne (Mayo, Western Electric Chicago 1924–32) — four experiments; Hawthorne Effect; Bank Wiring Room reveals informal group norms.
Behavioural anchors: Lewin (force-field, change), Maslow (hierarchy of needs, 1943), McGregor (X/Y, 1960), Herzberg (two-factor, 1959), Likert (4 systems, 1961), Argyris (immaturity-maturity), Skinner (operant), Bandura (social learning + self-efficacy 1977), Schein (culture 1985).
Davis’s five OB models: Autocratic → Custodial → Supportive → Collegial → System.
OB approaches: Human Resource · Contingency · Systems · Productivity · Interdisciplinary · Inter-actionist.
Pre-classical: Robert Owen (Father of Personnel Management); Charles Babbage 1832.
Indian contributors: Udai Pareek (Father of HRD in India), T.V. Rao (HRD audit), S.K. Chakraborty (Indian ethos), P.N. Khandwalla.