Introduction Organizational Behavior
Organizational Behavior is the study of enterprise from multiple view points, and it further analyzes the way in which organizational structures affect the behavior that is taking place within organization. The organizational behavior construes the relationship that exists between people and organization and depicts the way in which this relationship helps in accomplishing the organizational targets.
Present report emphasizes on the effectiveness of leadership and motivational theories. The impact of organizational culture and structure on the organizational development as well as effectiveness of management of change within firm is clearly highlighted in the report. For this study, TESCO has been undertaken. The report also makes a detailed understanding of organizational decision-making which demonstrates varied approaches towards managing risks.
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Evaluation of different leadership theories
Leadership is the process where a leader guides its followers and undertakes the responsibilities for their actions. Leader is the person who undertakes the initiatives and possesses the caliber to tackle issues and problems which are arising in a complicated situation (Bhatia, 2008). Leaders are born with some exceptional qualities or they may embrace such qualities after intensive learning and experience. A leader is required to have the following traits within him-
- Ability to utilize the power effectively- A leader must not only be well acquainted with his power but also, he must have the ability to use it wisely.
- Ability to apprehend- The people working within organization have different behaviors, thus, a leader must have the ability to understand different nature of people that are working around him.
- Ability to inspire people- A follower often tries to imitate its leader and get inspired from him. Therefore, it is imperative for him to show the devotion, dedication and build a charismatic personality which presents himself as a role model for others (Robbins, 2013).
Keeping common traits that are discussed above there are different leadership theories that prefer by the leaders so that they can easily manage and direct the employees towards attaining the specific goals. The evaluation of different leadership theories are-
This theory presents the manner in which a leader involves others in decision-making along with encouraging and supporting them. The different types of leaders are-
Autocratic leaders- The leader here uses downward communication style, that is, from the leaders to subordinates (Jones, 2010). This style is applicable where fast and spontaneous decisions are required to be undertaken and when there is high number of unskilled employees in the organization.
Democratic leaders- The leader here takes the input of its followers before concluding any decision. This style is favorable wherever team participation matters and where the organization promotes innovation and creativity.
Great Man Theory-
The clear distinction between leadership and an individual is defined in this theory. The base of this theory is that all leaders are great and noble men who come from a social background. These great men are often seen as good coordinators, planners, controllers, achievers and organizers.
In great man theory, it is believed that a leader is born with some exceptional qualities and the trait theory that is assisting the previous theory makes an attempt to recognize such qualities and skills which makes it a great man.
Evaluating the impact of managerial styles on orgevaluation of leadership theoriesanizational effectiveness
Managerial style is often a function that describes the behavior that is associated with the personality. The management style is a manner in which one manages the organization. An effective managerial style assists a leader to continually and progressively lead towards a planned destination. The managerial styles help organization in making decisions that discharges various functions of formulation, target setting, implementation of strategies and building of corporate image, handling the key stakeholders and performing other basic managerial activities.
Several managerial styles that have been evolved by different scholars are-
- Likert has identified participative, paternalistic, autocratic and consultative management styles.
- Burn and Stalker have recognized the organic and mechanistic styles.
- Minzberg has considered the entrepreneurial and strategic planning managerial styles.
The organization has consciously constructed to achieve the specific objectives. In order to achieve the set target, organizations define the structures that firm follows and the formulation of strategies as well (Scullion and Collings, 2006). The organizational effectiveness construes the organizational success that is associated with the attainment of goals. Different managerial styles cover the criteria such as profitability, employee's satisfaction; growth rate of revenue and sales, financial growth rate, etc.
Therefore, Likert management style has both positive as well as negative impact on the organization effectiveness as well as it will also result in achieving the goals and organization in the effective and efficient manner. For instance; the participative managerial style may have positive impact on the organizational activities as it involve collaborative approach. Manager will ensure proper participation of the employees in the decision-making process so that employee may also render positive suggestions that contribute in attaining the objectives. Therefore, it can be said that participative managerial style has positive impact on the overall activities of the enterprise. Another managerial style of Likert include autocratic style that mainly have negative impact on the employees. As, this managerial style mainly focus on bossy and dominating nature of the manager. However, autocratic managerial style negatively affect the employee as dominating behavior within the organization lead to demotivate the employees. Therefore, autocratic style negatively impact the activities of the organization. The management styles are one of the important factors that affect the effectiveness of organization. Thus, it can be said that a perfect blend of managerial styles will enhance the level of effectiveness of organization.
The way in which motivational theory influences the employee's motivation
It is a crucial aspect for the managers and leaders to improve and sustain the high performances of organization's employees. Since employees recognize varied factors to be motivating, it is critical for them to identify those factors which appeal the individual needs.
Motivation refers to the factors that drive an individual’s actions and behaviors often towards the goal and rewards which satisfy his needs (Shajahan, 2007).
Different motivational theories which affect employee's motivation are-
Maslow's Theory- This theory is also known as hierarchy needs of theory. This theory states that the motivation root from various set of needs which includes basic psychological, safety, social, esteem and self-actualization. According to this theory, it is believed that an individual is not expected to just jump over to the highest level of needs until he fulfills the lower level ones. The higher level of needs is self-esteem and self-actualization while the lower are psychological, safety and social needs. The manager uses this theory to encourage employees by fulfilling their basic needs and through rewarding him. The motivated employee’s remained loyal and performs better for the organization.
Herzberg's two factor theory- Herzberg has developed ‘two factor theory’ which includes two kinds of factors where one is motivators and other de-motivators. Motivator contains motivational techniques like recognition, achievements, personal investments and growth which boost a person to perform enthusiastically towards the organizational goals. The dis-satisfactory factors contain motivation techniques like basic pay, job security, working condition etc. These elements if not present will bring dissatisfaction among employees towards the organization (Dweck, 2013).
Theories depicting the working relationship and interaction
The positive environment at workplace is established through positive psychology and positive organization behavior. The work relationship and interactions are pivotal towards life satisfaction, development, enrichment and personal growth for individuals. The theories that can be applied and which presents workplace relationship and interaction are-
Social Exchange theory- This theory is based on the exchange of goods, material good but also the non-material ones that are related to approval or promotions. The theory shows the way in which one feels about the relationship with another person on the basis of cost v/s the rewards. The employees have been rewarded for the efforts to check whether they are put by employees or not. The rewarding system determines the satisfaction of individuals towards the work or with the organization.
The uncertainty reduction theory- It explains the development of relationship of new employees that is completely strange to the organization (Furnham, 2005). The organization’s managers in order to reduce this uncertainty follows different development stages which are like-
- Entry phase- The manager uses various behavioral norms such as demographic and transactional.
- Personal phase- The employee’s attitudes and beliefs are evaluated. It also analyzes the employee’s moral and personal issues along-with its emotional involvement towards the organization.
- Exit phase- The future interaction and varied relationship negotiation.
The way in which organization can facilitate innovation and creativity
In the rapid development times, creativity and innovation has constituted not only as a leveraging factor for the growth but it is also considered to be a survival element for any organization. One of the most important leadership qualities is creativity. The organization that is striving to turn innovative focuses exclusively on different products and services in order to develop a differentiated product or service.
The driving force behind facilitation of innovation and creativity is Research & Development. Creativity is defined as the ability to generate ideas and it is a part of innovation. Innovation is more specifically defined as the ideas, the product, the services and the processes that are perceived as new and unique.
The organization should make extensive searching for information and it synthesizes the available information. The incubation can also be used as a practice to acknowledge the new ideas. For this, organization can also encourage innovation by accepting employee's participation in decision-making (Burnes, Cooper and West, 2003). Gathering and considering their ideas while making final decisions are also the ways that firm can use. It involves engaging with employees and discussing with them the opportunities or problems.
The organization can also construct different solutions for a specific opportunity or problem. It includes designing and developing prototypes and development plans for them. If the idea developed is complicated or the business process is too complex then the same can be presented through flowcharts or diagrammatic form to understand different stages of the same.
Importance of learning in organization
Learning helps in building organization’s reputation and chances of survival along-with the improvement in firm’s performance, experience, morale, developing and retaining of talents. The learning culture is crucial for any organization.
The learning is an active and participative process rather than just pouring of information. Learning provides following assistance to the organization-
- Problem solving skills
- Questioning skills
- Fostering of innovative and creative ideas
- Sharing of ideas and stimulating responsive environment
- Development of talents and mentoring
- Development of human capital of organization
The development of learning culture in an organization is important due to following reasons-
- This helps in developing the morale and motivation of employees as it bring employees satisfaction (Pivo, 2008).
- This help in retaining the productive staffs which in turn help in lowering the cost of organization.
- With the change factor, critical learning culture helps in faster rate of acceptance towards the change.
- Learning can produce positive return on investment.
Effectiveness of team work
The effectiveness of team work helps the business in accomplishing more in comparatively less time by taking the advantage of strength of different team members that are working in an organization. The teamwork is effective in operating varied tasks that are carried out in the business structure. The team work brings synergy benefits to the organization which increases both productivity and creativity within firm. In teamwork, many people bring different ideas. By working collectively, the team is able to bring more objective solutions to a particular issue as compared to an individual. The team is able to focus and capitalize the ideas of different team members. The coordination created by working together as a team can build a healthy work environment thereby decreasing the employees’ issues such as their regular absenteeism from work. The team work creates awareness and brings synergy benefits to the organization (Nutbeam, Harris and Wise, 2010). the effectiveness of team work include-
Effective management of change within organization
Managing organizational change is more effective if an organization applies the principles that are stated as below-
Addressing the “human-side” consistently- The issues of people are often created whenever an organization brings systematic transformation in its system. New skills and capabilities are required to be developed in employees to the changed needs which bring resistance among them. The dealing of these issues on a continuous basis is required by the organization. The management must streamline the design and process of change for its smooth acceptance by the employees (Mendes and Stander, 2011).
Initiating change at top- As changes has the potential to create disturbance at all levels of organization, the CEO of firm is often looked upon for support, strength and direction for change. They are required to communicate with the staff and employees and support them during the change as these are often stressful times for them.
Involve everyone's participation- The successful implementation of change is only possible through positive participation of all towards changes.
Analyzing the culture and structure of TESCO and their impact on its effectiveness
The organizational structure is the planning and distribution of duties that are required for the completion of job. On the other hand, culture is made up of beliefs, values, attitudes, underlying assumptions and behavior of people.
TESCO follows a hierarchical structure as it has varied number of levels and numerous people that are accountable to more than one head of person. The sequence of command can be seen as a pyramid with large number of staff and is supervised by at least one person at each level. The following structure helps TESCO in precisely determining the work that they are required to perform and they do not need to wait until they are told. There is clear authority and responsibility relationship that is defined by assuring the completion of tasks and this turns out to be cost effective for the organization.
TESCO comes up with a very supporting and welcoming approach. TESCO follows the task culture within its organization. The control arrangements and measurements are regularly monitored with meeting the competency of employees and manager’s decision. The culture in TESCO’s culture has helped it in bringing out strong atmosphere of all activities where it is properly streamlined and controlled (Hosie and Smith, 2009).
Analyzing different approaches to organizational decision-making
There are various approaches to decision making which bring an insight to the picture of processes through which the managers are arrived at the final decision. The varied approaches are-
Rational Approach- The rational decision-making is an organized and systematic process of undertaking decisions. It makes assumption that the organization is economical and is managed by decisions that are absolutely logical and objective.
Behavioral Approach- This approach is based on the pattern of decision makers who are confined to rationality. The process of decision-making here is neither completely not exhaustive rational and therefore, decision often arrived are not perfectly ideal. This process requires detailing and is based on the judgments and personal prejudice as well as on some level of logical reasoning (Creese, 2003).
Practical Approach- This approach combines the rational approach towards more realistic process for undertaking decisions. Here, the decisions are taken after analyzing it on the basis of time, money and other practicalities of the situation.
Assessing management approaches to risk and uncertainty in decision-making
The organizational decisions within the TESCO is effective for the firm as it will support the management in improving their performance as well as it will also result in building the organization by generating higher profits. The effectiveness of organizational decisions can also be measured in terms of measuring the satisfaction level of the customers as well as ensuring that all the stated objective of TESCO has been achieved or not. Furthermore, the effectiveness of organizational decisions results in-
Increasing the profit margin- The effectiveness of decision-making is being measured by assessing the constant increase in the profit of the company as compare to the other grocery retailers that is Asda and Sainsbury. Increase in the prfit ratio depicts that organization is taking effective decisions regarding their activities that lead to increase the profit margin.
increasing the satisfaction level of customers- Another way that state effectiveness of decision-making process include that customers get attracted towards their products and offering and purchases their products as compare to other discounted retailers. Therefore, the satisfaction level of customer ensure that TESCO is taking effective decisions that support the establishment in accomplishing the objectives.
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The above report shows the significance of leadership and different approaches that can be followed by the organization. Along with that, motivational theories are also highlighted briefly in the report with the help of which company can survive in the long run with sustainability. Different organizational structures and cultures along-with their effectiveness in TESCO have been depicted here as well that provides strengths to the firm. Last but not the least, report also shows the effectiveness of decision-making within organization in order to have smooth functioning of business.
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- Furnham, A., 2005. The psychology of behaviour at work: The individual in the organization. Psychology Press.
- Jones, G. R., 2010. Organizational theory, design, and change. Pearson.
- Nutbeam, D., Harris, E. and Wise, W., 2010. Theory in a nutshell: a practical guide to health promotion theories.
- Robbins, S and et. al., 2013. Organisational behaviour. Pearson Higher Education AU. Sage.
- Scullion, H. and Collings, D. G., 2006. Global staffing. Routledge.