Organizational behaviour
Organizational Behaviour refers to the study and understanding of how people’s interactions within a company affect its performance.
If your company seeks to improve job performance, increase employee satisfaction, promote innovation, or encourage effective leadership, it has become involved in organizational behaviour.
Organizational behaviour is an umbrella term that describes how factors such as group dynamics, communication, motivation, and company culture contribute to an organization’s performance. In essence, it helps explain how individuals and groups function in work settings and how these interactions can influence an organization’s ability to meet its objectives.
The drivers of organizational behaviour are important to understand because they determine a company's overall productivity.
What are the four elements of organizational behaviour?
Here are the four key elements of organizational behaviour:
What is the primary focus of organizational behaviour?
The primary focus of organizational behaviour is to improve a company’s effectiveness through human interaction. It draws on principles from psychology, sociology and anthropology to understand how people’s behaviour can influence their work environment, either positively or negatively.
Examples of organizational behaviour
| Positive examples | Negative examples |
|---|---|
| Employees advocating for solutions to organizational problems | Verbal or physical aggression in the workplace |
| Opportunities or challenges being identified and action being taken | Rumours being spread around the office |
| Effective communication among employees and management | Increase in absences without valid reasons |
| Novel ideas, products or processes being introduced | Responsibility not being taken |
| New employees adapting well | Missed deadlines |
Why does organizational behaviour matter?
Organizational behaviour impacts every aspect of an organization, from individual performance to overall success. It can help companies in various ways:
- create a positive work environment, leading to higher productivity and job satisfaction
- inform leadership practices, emphasizing empathy, communication and motivation
- provide tools to manage conflicts and improve collaboration among team members
- adapt to new technologies and market dynamics
- improve employee well-being
What are models of organizational behaviour?
Companies are run in different ways. Organizational behaviour models provide insights into various factors that influence the way they’re run. They also affect behaviours in the workplace, including individual characteristics, interpersonal interactions and organizational structure.
Here are five major models of organizational behaviour:
| Autocratic | This model relies on strength, power and formal authority. In autocratic organizations, top management makes key decisions, and lower-level employees have little control over their work functions. This approach is outdated for most modern-day organizations. |
| Custodial | Based on providing economic security (wages, benefits) to create employee loyalty and motivation. While it attracts skilled staff, it may also retain low performers. |
| Supportive | Focused on aspiring leadership, emphasizing positive manager-employee relationships and day-to-day treatment of employees. |
| Collegial | Assumes employees are competent and self-motivated. Encourages collaboration, teamwork and shared decision-making. |
| System | Views the organization as an interconnected system, considering external factors, internal processes and feedback loops. |
How do company values, vision and mission affect organizational behaviour?
Your company’s values, vision and mission define your organizational behaviour. They help lay out a company’s strategy, set priorities, allocate resources, and ensure that everyone is working towards common goals and objectives.
Émilie Poirier, Senior Business Advisor, Human Resources, BDC Advisory Services advises companies on how to put together vision and mission statements,
“The mission is your DNA, while the vision is what you want to accomplish.”
Poirier says a mission statement requires you as a company to answer three important questions:
- Why do we exist?
- Who do we serve?
- What is unique about us?
As for values, those are also questions that a company has to ask itself, she says. “What are the important values you hold that will guide your employees toward fulfilling your mission and vision?”
What is organizational culture?
Organizational culture is generally understood as a company’s beliefs, values and attitudes, and how these influence the behaviour of its employees.
Culture affects how people experience an organization—that is, what it’s like for a customer to buy from a company or a supplier to work with it. It shows up in company policies such as dress code and office hours. It also informs things such as workspace design and employee perks. Culture is usually set by a company’s leaders.
Unless companies define their cultures explicitly, culture tends to emerge organically from what people believe, how they think, what they say and what they do. Business owners shouldn’t leave to chance whether a spontaneously generated culture is a positive and productive one, but should instead be deliberate about influencing how their culture takes shape. A business can define and redefine its values and core principles in order to foster a more positive culture that encourages effective interactions between people within the organization.
Next step
Improve your team’s engagement by downloading BDC’s free Employee goal-setting template.