Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Chapter 2 Organizational Behavior: Foundations, Realities, & Challenges Nelson & Quick, 5 th edition Challenges for Managers

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Remaining Competitive: Four Major Challenges to Managers Globalizing the firm’s operations Managing a diverse workforce Keeping up with technological change and implementing technology in the workplace Managing ethical behavior

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Changing Business Perspectives From International (which implies an individual’s or organization’s held nationality is strongly in consciousness) To Globalization (which implies the world is free from national boundaries and that it is really a borderless world)

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved From Multinational Organizations (in which the organization was recognized as doing business with other countries) Changing Business Perspectives To Transnational Organizations (in which the global viewpoint supersedes national issues)

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Changes in the Global Marketplace Collapse of Eastern Europe Union of East and West Berlin Perestroika Expansion of business with China Guanxi – The Chinese practice of building networks for social exchange Creation of the European Union Establishment of the North American Free Trade Agreement

Understanding Cultural Differences Reprinted with permission of Academy of Management, PO Box 3020, Briar Cliff Manor, NY Cultural Constraints in Management Theories (Figure), G. Hofstede, Academy of Management Executive 7, (1993). Reproduced by permission of the publisher via Copyright Clearance Center, Inc. Individualism High power distance High uncertainty avoidance Masculinity Long-term orientation Collectivism Low power distance Low uncertainty avoidance Femininity Short-term orientation Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Individualism-Collectivism Emphasizes needs and goals of individual Respond to material rewards Decisions made by individuals Leader provides autonomy and opportunities for growth Expect to be told of poor performance Emphasizes group identity Prefer team rewards Expect mutual loyalty between organizational leaders and followers New ideas come from the group Manage group behavior through group norms and social values Leaders nurture followers Prefer indirect criticism

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Power Distance Low power distance Uncomfortable with differences in wealth, status, power and privilege Promote equal rights Emphasize interdependence High power distance Inequality natural Superiors are special and deserve special privileges Obligated to take care of subordinates

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Uncertainty Avoidance High –View uncertainty as a threat –Less tolerant –Believe in written rules –Seek security –Give more weight to age and seniority when selecting leaders –Managers seem unapproachable –Are more loyal Low –Accept uncertainty as a fact of life –Experience less stress –Take more risks –Less concerned about rules –More likely to trust their own judgment –Emphasize interpersonal relationships

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Masculinity-Femininity Men are assertive, competitive, ambitious and dominant Members more motivated by material success “Live to work” Women are encouraged to serve Are better at interpersonal relationships Put greater emphasis on intuition “Work to live”

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Long-Term/Short-Term Orientation Encourage norms and behaviors that lead to future rewards Sacrifice immediate gratification for long term benefits Feelings of shame come from violation of social contracts and commitments Status relationships clearly defined Respect tradition Expect quick results Put much less importance on persistence Spend freely and have lower savings rates Under greater pressure to demonstrate immediate progress

Reprinted with permission of Academy of Management, PO Box 3020, Briar Cliff Manor, NY Cultural Constraints in Management Theories (Figure), G. Hofstede, Academy of Management Executive 7, (1993). Reproduced by permission of the publisher via Copyright Clearance Center, Inc. Where the U.S. Stands Individualism High power distance High uncertainty avoidance Masculinity Long-term orientation Collectivism Low power distance Low uncertainty avoidance Femininity Short-term orientation Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Developing Cross-Cultural Sensitivity Cultural sensitivity training Cross-cultural task forces/teams Global view of human resource functions Planning Recruitment and Selection Compensation Training and Development

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Diversity All forms of individual differences, including culture, gender, age, ability, personality, religious affiliation, economic class, social status, military attachment, and sexual orientation

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Diversity Statistics for the Workplace Cultural 2020 Workforce: 68% white non-Hispanic 14% Hispanic 11% African-American 5% Asian Gender 2020 Workforce: 50% male 50% female

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Women and Obstacles at Work Today, women make up over 60% of the workforce, earn 32% of all doctorates, 52% of master’s degrees, and 50% of undergraduate degrees BUT Today, women hold less than 15.7% of Fortune 500 corporate officer positions, earn 78% of what their male counterparts do, and encounter the glass ceiling in the workplace a transparent barrier that keeps women from rising above a certain level in organizations

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Diversity Statistics Affecting the Workplace Age By 2030, there will be 70,000,000 older persons. People over 65 will comprise 20% of the population. Ability An estimated 50 million disabled live in the U.S.; their unemployment rate exceeds 50%.

Diversity’s Benefits & Problems BENEFITSPROBLEMS Attracts & retains the best human talent Improves marketing efforts Promotes creativity and innovation Results in better problem solving Enhances organizational flexibility Resistance to change Lack of cohesiveness Communication problems Interpersonal conflicts Slowed decision making Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved

Ethical Theories Consequential Theory – an ethical theory that emphasizes the consequences or results of behavior Rule-Based Theory – an ethical theory that emphasizes the character of the act itself rather than its effects Character Theory – an ethical theory that emphasizes the character, personal virtues, and integrity of the individual Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Employee Rights Issues Computerized monitoring Drug testing Free speech Downsizing Layoffs Due process AIDS in the workplace

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Sexual Harassment = Unwanted Sexual Attention Gender Harassment – crude comments; behaviors that convey hostility toward a particular gender Unwanted Sexual Attention – unwanted touching, unwanted pressure for dates Sexual Coercion – demands for sexual favors through job-related threats or promises Harassment or Potential Romance?

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Organizational Justice Distributive Justice – fairness of the outcomes that individuals receive in an organization Ex. Companies in Danger CEO Salaries vs. Ex. Competence and Skill Race and Gender vs. Procedural Justice – fairness by which the outcomes are allocated in an organization

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Individual and Organizational Responsibility Whistle-Blower – an employee who informs authorities of the wrongdoing of his or her company or coworkers –Public Hero –“Vile Wretch” Social Responsibility – the obligation of an organization to behave ethically

Rotary Four-Way Test of What We Think, Say, or Do 1.Is it the TRUTH? 2.Is it FAIR to all concerned? 3.Will it build GOODWILL and better friendships? 4.Will it be BENEFICIAL to all concerned? Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Technological Innovation Technology The intellectual and mechanical processes used by an organization to transform inputs into products or services that meet organizational goals Examples Internet – integrates computer, cable, telecommunications technologies Expert System – computer- based application using a representation of human expertise in a specialized field of knowledge to solve problems Robotics – use of robots in organizations

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Alternative Work Arrangements Employees Gain flexibility Save the commute to work Enjoy the comforts of home But, they Have distractions Lack socialization opportunities Lack interaction with supervisors Identify less with the organization Telecommuting – transmitting work from a home computer to the office using a modem

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Additional Alternative Work Arrangements Hoteling – employees have mobile file cabinets/lockers for personal storage; work spaces are reserved, not assigned Satellite Offices – large facilities broken into smaller workplaces near employees’ homes Virtual Office – people work anytime, anywhere, with anyone

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Technological Change Requires Managers to Develop technical competence to gain workers’ respect Focus on helping workers manage the stress of their work Take advantage of the wealth of information available to motivate, coach, and counsel—not to control

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Help Employees Adjust by Involving them in decision making regarding technological change Selecting technology that increases workers’ skill requirements Providing effective training Establishing support groups Encouraging reinvention (creative application of new technology)

Copyright ©2006 by South-Western, a division of Thomson Learning. All rights reserved Four Challenges to Organizations in the New Millennium Globalization Diversity Ethics Technology