Management and Organisational Behaviour
The past few decades have been characterized by various changes on multiple organizational levels. And a most relevant such change is the development of a strong corporate culture that integrates all shareholders and has them working together as to sustain the organization in reaching its overall objectives. Compared to half a century ago, the ultimate goal of an economic entity remains the registration of increased profits, but today, they strive to achieve this by ensuring full customer and employee satisfaction, increased value to the shareholder and the development of the communities where the organizations operate. In other words, the operational activities within companies have changed and adapted to various forces in the micro and macro environments. Similarly, the managerial approach has also changed in response to a multitude of factors, the most common of which being the individual behavior of employees.
The list of examples as to how has individual behavior impacted the overall managerial operations within corporate entities is endless and it reveals examples from a variety of situations. For instance, the individual behavior can be described in that the employee will work harder if he is presented with the possibility of additional gains. As such, the managerial team has come up with incentive plans that stimulate the worker to increase his performances and better sustain the organization in reaching its overall goals. A specification that must be made here is that the individuals do not function as a homogenous group, but that inside the group, the employees are driven by various forces. For instance, one could be motivated by an increased salary; another on the other hand could be stimulated by a flexible schedule that allows him to spend more time with his family; another employee could be stimulated by the possibility of occupying a better paid position, with more responsibilities and more rewards. All in all, this goes to show that the individual demands of each employee have the capacity to influence the managerial and organizational behavior within the economic entity.
To respond to these individual needs of the staff members, the management teams at various organizations have clearly analyzed the four primary motivational theories and have tried to adapt the corporate affairs to the motivational factors discussed by Abraham Maslow, Frederick Herzberg, David McClelland and .
Abraham Maslow – Hierarchy of Needs
Maslow’s theory divides the human needs into a pyramid of five levels. The first level contains the physiological needs, such as clothing, eating or housing. The second level contains the safety and security needs. The third one refers to the needs of belonging to a group. The fourth level refers to the needs of being respected and having one’s merits recognized. Finally, the fifth level is that of self-actualization, meaning that the individual desires to continually evolve, reach its maximum and become the best at what he does.
In response to these individual needs, organizational managers have implemented a wide series of strategies that increase employees’ satisfaction and ensure their high performances. For instance, the simple wage is aimed to satisfy the first two categories of needs. Then, the creation of a strong corporate culture to integrate all staff members is aimed to satisfy the third type of needs.
Frederick Herzberg – Dual Factor Theory
Herzberg and his collaborators divided the employees’ needs into two categories: the first is called motivators and refers to the actual forces which increase the employee’s satisfaction, whereas the second category, called the hygienes, refer to those factors which only prevent dissatisfaction. Under the category of motivators, Herzberg included “achievement, recognition, work itself, responsibility (and) advancement” (Stuart-Kotze, 2008). Under the hygienes category, he included the “company policy and administration, working conditions, supervision, interpersonal relations, money, status (and) security” (Stuart-Kotze, 2008).
Corporate managers paid close attention to these individual forces and integrated them within organizational affairs in the form of creating a pleasant working environment, which stimulates collaboration, but also competition.
David McClelland – the Need for Achievement
Harvard professor David McClelland was intensely dedicated to the study of achievement, as the ultimate motivational force within any organization. He divided this need into a need for power and a need for affiliation. The results indicated the main characteristics of the organization man: hard working, success oriented, willing to sacrifice personal features and finally, fair, correct and revealing a strong sense of justice.
Victor Vroom – Expectancy Theory
Vroom’s theory states that an individual within an economic entity is primarily driven by the future possibility of a success. In other words, he expects for his efforts to be accordingly remunerated or rewarded with a promotion, a full time job offer for a trainee and so on (Stuart-Kotze, 2008).
In implementing these individual needs, organizational managers have developed numerous incentive plans, such as the offering of increased wages, premiums, bonuses or promotions.
The four above presented theories are relevant in the context of driving the individual, which is then capable to influence the organizational behavior of his employing company. The responses generated by the economic entities relative to the motivational factors vary in terms of intensity, ability to implement or resources possessed, but fact remains that all organizations have attempted to integrate stimuli that increase the performances of the workers. The ultimate goal of each organization offering incentive plans to its staff members is that of best benefiting from their intense efforts.
Aside the offering of a pleasant, yet competitive working environment, while also offering promotions and rewards, the managers of large companies have also thought of more financial approaches to responding to the individual needs of their corporate employees. A most relevant example in this sense is that of allowing the staff members to participate to the profit distribution. This basically means that the personnel are allowed to purchase corporate stocks and, at the end of the fiscal year, they will receive dividends in accordance with the purchased stocks. The amounts are generally limited to a certain percentage of the employee’s monthly or annual salary.
Besides allowing the employees to directly participate to the profit distribution, this particular measure also has a direct benefit for the organization as it stimulates the employees to increase their performances. To better understand, when the staff members realize that their ultimate goal is for the organization to end the year on profits, so that they are able to receive dividends, they will work harder to ensure that the company reaches its objectives. The most relevant examples of organizations that have successfully implemented this strategy in response to the individual demands of the staff members are Bill Gates’ Microsoft Corporation and Howard Schultz’s Starbucks. Both entities allowed their employees to purchase corporate stocks and the beneficial results on both corporate performances and employees’ behavior and satisfaction did not tardy.
Another standpoint to analyze the individual differences which could easily impact the organizational behavior and ultimately, its outcome is given by the shareholders. To best understand their individual capacities to influence the corporate behavior and outcome, one should consider the example of the profits registered at the end of a fiscal year. At the general meeting, all shareholders are able to state their opinions relative to the distribution of profits. Say for instance that the chief executive officer proposes that the respective year, dividends are not to be issued and in stead, the company uses the money to finance a new venture, that is likely to register increased revenues and help the organization better consolidate its position within the international market; the decision must be unanimous. The new venture could be supported by most of the shareholders, who in the desire to register increased profits in the future agree with the investment. However, considering that one shareholder refuses to renounce its dividends, the venture is compromised; ergo, the individual differences once again impact the organizational behavior of the economic entity.
The succinct presentation of the four motivational theories was relative from the standpoint of the differences that arise between individuals. In this order of ideas, the organizational background used to be composed on two parties: the managerial teams and the operational employees. The two groups would normally function based on similar principles, desires and expectations. Today however, this is not always true as each individual employee is driven by different forces. Then, the two teams have developed along the years, to now also comprise of the general public, the shareholders and a wide variety of business collaborators, such as partners, purveyors or intermediaries. All of the individuals within these groups have the capacity to influence an organization’s behavior and ultimate success.
Fabozzi, F.J., Peterson, P.P., 2003, Financial Management and Analysis, 2nd Edition, John Willey and Sons Inc.
Hariss, J.O., Hartman, S.J., 2001, Organizational Behavior, 1st Edition, Taylor & Francis Inc.
Stuart-Kotze, R., 2008, Motivation Theory, http://www.goal-setting-guide..htmllast accessed on September 15, 2008
2008, Official Website of the Microsoft Corporation, http://www.microsoft.com/en/us/default.aspxlast accessed on September 15, 2008
2008, Official Website of Starbucks, http://starbucks.com/last accessed on September 15, 2008