Chapter 01 - Effective Managers Understand Organizational Behavior
Chapter One: Effective Managers Understand Organizational Behavior
Chapter Synopsis
This chapter launches the students' study of organizational behavior by providing an overview of
management history and the OB field, and by identifying forces that promise to reshape the nature
of management. It exposes the how, what, why, and when of organizational behavior, as viewed and
practiced by managers. It also identifies the skills and competencies that leaders will need to create
the ideal 21st-century work atmosphere, such as intelligence, passion, a strong work ethic, a team
orientation, and a genuine concern for people.
Learning Objectives
After completing this chapter, students should be able to:
1. Summarize key contributions from the evolution of management.
2. Discuss why it is important to understand organizational behavior.
3. Explain how systems theory relates to organizational effectiveness.
4. Analyze the environmental forces affecting today’s management practices.
5. Understand how to frame the study of organizational behavior.
1-1
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
,Chapter 01 - Effective Managers Understand Organizational Behavior
Key Terms
scientific management—A body of literature that emerged during the period 1890–1930 and that
reports the ideas and theories of engineers concerned with such problems as job definition, incentive
systems, and selection and training.
organizational behavior—Drawing on psychology, sociology, political science, and cultural
anthropology, OB is the study of the impact that individuals, groups, and organizational structure
and processes have on behavior within organizations.
Systems Theory— A theory stating that an organization is a managed system that changes inputs
into outputs.
inputs— Goods and services (raw materials, human resources, energy, etc.) organizations take in
and use to create products or services.
outputs— The products and services (smartphones, food, social networking sites, etc.) that
organizations create.
power— The ability to get things done in the way one wants them to be done.
globalism— The interdependency of transportation, distribution, communication, and economic
networks across international borders.
diversity— Refers to those attributes that make people different from one another
speed of change— Rapid change is found in many areas such as technology, demographics,
globalism, and new products and services.
psychological contract— An unwritten agreement between an employee and the organization that
specifies what each expects to give to and receive from the other.
technology— Refers to actions, physical and mental, that an individual performs upon some object,
person, or problem to change it in some way.
1-2
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
, Chapter 01 - Effective Managers Understand Organizational Behavior
Lecture Outline
The chapter outline is organized to correspond with the PowerPoint slides.
The chapter title slide may be used as a background to introduce the class.
Learning objectives
Review the chapter learning objectives. These will be reviewed on the last slide of the
pack.
Introduction
Instructors may want to review the Zappos example at the beginning of the chapter.
The Jack Welsh quote shared in the text may also be helpful.
“The talents of our people are greatly underestimated, and their skills are underutilized.
Our biggest task is to fundamentally redesign our relationship with our employees. The
objective is to build a place where people have the freedom to be creative, where they
feel a sense of accomplishment—a place that brings out the best in everybody.”
Environmental Forces Reshaping Management
Managers must be agile and flexible to help their firms develop and sustain an
advantage in an increasingly competitive globalized world. They will need to harness
the powers of information technology and human capital to be successful.
The competitive forces facing managers are led by technological changes and increasing
globalization. These driving forces are characterized by greater knowledge and the use
of information, the liberalization of developing economies (e.g., Brazil, Russia, India,
and China), and new economic alliances and rules.
The Origins of Management (1 of 2)
The formal and modern study of management started around 1900. However, the
management process probably first began in the family organization, later expanded to
the tribe and community, and finally pervaded the formalized political units such as
those found in early Babylonia (5000 B.C.). The Egyptians, Chinese, Greeks, and
Romans were all noted in history for major managerial feats such as the building of the
pyramids, organizing governments, planning military maneuvers, operating trading
companies that traversed the world, and controlling a geographically dispersed empire.
However, management as a process was based on trial and error in order to accomplish
specific goals, with little or no theory and virtually no sharing of ideas and practices.
This lack of sharing slowed the influence of management practices throughout the
world.
This trial and error approach to management continued during the Industrial Revolution
in England that lasted between 1700 and 1785. As a nation, England changed
dramatically from a rural society to the workshop of the world. It was the first nation to
successfully make the transition from a rural-agrarian society to an industrial-
commercial society. Management of the workshops of England was characterized by an
emphasis on efficiency, strict controls, and rigid rules and procedures.
A new industrial era began in the United States around the time of the Civil War. There
was a dramatic expansion of mechanical industries such as the railroad. In addition,
1-3
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
Chapter One: Effective Managers Understand Organizational Behavior
Chapter Synopsis
This chapter launches the students' study of organizational behavior by providing an overview of
management history and the OB field, and by identifying forces that promise to reshape the nature
of management. It exposes the how, what, why, and when of organizational behavior, as viewed and
practiced by managers. It also identifies the skills and competencies that leaders will need to create
the ideal 21st-century work atmosphere, such as intelligence, passion, a strong work ethic, a team
orientation, and a genuine concern for people.
Learning Objectives
After completing this chapter, students should be able to:
1. Summarize key contributions from the evolution of management.
2. Discuss why it is important to understand organizational behavior.
3. Explain how systems theory relates to organizational effectiveness.
4. Analyze the environmental forces affecting today’s management practices.
5. Understand how to frame the study of organizational behavior.
1-1
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
,Chapter 01 - Effective Managers Understand Organizational Behavior
Key Terms
scientific management—A body of literature that emerged during the period 1890–1930 and that
reports the ideas and theories of engineers concerned with such problems as job definition, incentive
systems, and selection and training.
organizational behavior—Drawing on psychology, sociology, political science, and cultural
anthropology, OB is the study of the impact that individuals, groups, and organizational structure
and processes have on behavior within organizations.
Systems Theory— A theory stating that an organization is a managed system that changes inputs
into outputs.
inputs— Goods and services (raw materials, human resources, energy, etc.) organizations take in
and use to create products or services.
outputs— The products and services (smartphones, food, social networking sites, etc.) that
organizations create.
power— The ability to get things done in the way one wants them to be done.
globalism— The interdependency of transportation, distribution, communication, and economic
networks across international borders.
diversity— Refers to those attributes that make people different from one another
speed of change— Rapid change is found in many areas such as technology, demographics,
globalism, and new products and services.
psychological contract— An unwritten agreement between an employee and the organization that
specifies what each expects to give to and receive from the other.
technology— Refers to actions, physical and mental, that an individual performs upon some object,
person, or problem to change it in some way.
1-2
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
, Chapter 01 - Effective Managers Understand Organizational Behavior
Lecture Outline
The chapter outline is organized to correspond with the PowerPoint slides.
The chapter title slide may be used as a background to introduce the class.
Learning objectives
Review the chapter learning objectives. These will be reviewed on the last slide of the
pack.
Introduction
Instructors may want to review the Zappos example at the beginning of the chapter.
The Jack Welsh quote shared in the text may also be helpful.
“The talents of our people are greatly underestimated, and their skills are underutilized.
Our biggest task is to fundamentally redesign our relationship with our employees. The
objective is to build a place where people have the freedom to be creative, where they
feel a sense of accomplishment—a place that brings out the best in everybody.”
Environmental Forces Reshaping Management
Managers must be agile and flexible to help their firms develop and sustain an
advantage in an increasingly competitive globalized world. They will need to harness
the powers of information technology and human capital to be successful.
The competitive forces facing managers are led by technological changes and increasing
globalization. These driving forces are characterized by greater knowledge and the use
of information, the liberalization of developing economies (e.g., Brazil, Russia, India,
and China), and new economic alliances and rules.
The Origins of Management (1 of 2)
The formal and modern study of management started around 1900. However, the
management process probably first began in the family organization, later expanded to
the tribe and community, and finally pervaded the formalized political units such as
those found in early Babylonia (5000 B.C.). The Egyptians, Chinese, Greeks, and
Romans were all noted in history for major managerial feats such as the building of the
pyramids, organizing governments, planning military maneuvers, operating trading
companies that traversed the world, and controlling a geographically dispersed empire.
However, management as a process was based on trial and error in order to accomplish
specific goals, with little or no theory and virtually no sharing of ideas and practices.
This lack of sharing slowed the influence of management practices throughout the
world.
This trial and error approach to management continued during the Industrial Revolution
in England that lasted between 1700 and 1785. As a nation, England changed
dramatically from a rural society to the workshop of the world. It was the first nation to
successfully make the transition from a rural-agrarian society to an industrial-
commercial society. Management of the workshops of England was characterized by an
emphasis on efficiency, strict controls, and rigid rules and procedures.
A new industrial era began in the United States around the time of the Civil War. There
was a dramatic expansion of mechanical industries such as the railroad. In addition,
1-3
Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
