The purpose of this paper is to define the concept of Organisational Behaviour and identify the most important areas of the topic which considerably impact on organisational efficiency and effectiveness. Nowadays, due to the rapidly changing business environment, perceiving organisational behaviour is recognised as one of the most significant aspects of all business operations (Robbins and Judge, 2010). According to Financial Times Mastering Management (1997) “Organisational behaviour is one of the most complex and perhaps least understood academic elements of modern general management, but since it concerns the behaviour of people within organisations it is also the most central… its concern with individual and group patterns of behaviour makes it an essential element in dealing with the complex behavioural issues thrown up in the modern business world.”
This paper focuses on two areas of organisational behaviour that are considered crucial in achieving organisational effectiveness and efficiency, these are: organisational structure and management. Organisational structure and management play a crucial and direct role in organisational behaviour. The study of organisations, their structure and identification of key trends in management and organisational behaviour are crucial in achieving organisational goals and objectives (Mullins, 2010).
Definition of Organisational Behaviour
According to Robbins and Judge (2010), “Organisational behaviour is a field of study that investigates the impact that individuals, groups and structure have on behaviour within organisations, for the purposes of applying such knowledge towards improving organisation’s effectiveness.” Griffin (2011) defined Organisational Behaviour as “the study of organisational behaviour in organisational setting, the interface between human behaviour and the organisational context and the organisational itself”.
In other words, Organisational Behaviour is “the study and application of knowledge about how people, as individuals and groups act within an organisation. It strives to identify ways in which people can act more effectively” (Ahmad et al, 2008). The concept of Organisational Behaviour has been defined by many authors in various literature, Mullins (2008) summarised that “common definitions of organisational behaviour are generally along the lines of the study and understanding of individual and group behaviour, and patterns of structure in order to help improve organisational performance and effectiveness”.
Cole (1995) suggested that “The structures developed for work organisation, their nature, and the reasons why they are, or should be, adopted to increase their effectiveness have a considerable bearing on the subject of organisational behaviour”. The key elements of an organisational structure are work specialisation, departmentalisation, chain of command, span of control, centralisation and formalisation (Mullins, 2002). The significance of organisational structure is primarily critical for communication within an organisation and allows the distribution of authority. According to Robbins and Coulter (2007), “organisational structure is a formal framework by which job tasks are divided, grouped and coordinated”. The concept is contributed to organisational culture, management style, leadership approach and it is strongly influenced by environment, therefore provides a fundamental framework to organisational efficiency and effectiveness (Daft and Armstrong, 2009).
Mullins (2005) states that “Structure is the pattern of relationships among positions in the organisation and among members of the organisation. Structure makes possible the application of the process of management and creates the framework of order and command through which the activities of the organisation can be planned, organised, directed and controlled”. On the other hand, according to Drucker (1989), design of organisation structure is strongly contributed to organisational performance and poor organisation structure makes effective performance difficult to achieve.
According to Rosenfeld and Wilson (1999), organisational effectiveness and efficiency will strongly depend on right identification of key elements of structure. This involves the process of delegation of authority in decision making which primarily refers to the centralisation or decentralisation (Cloke and Goldsmith, 2002). Mullins (2005) identified the chain of command concept which relates to the importance of a clear line of authority and responsibility within an organisation.
The framework is contributed to identification of subordinate relationships in a line down from the top of the organisation, therefore is crucial for effective operation of organisation. The combination of span of control and chain of command establish whether the organisational structure is flat or tall. Graicunas (1937) argue that due to the need for improved efficiency and competitiveness, organisations move towards flat organisation structures. The author claims that flatter structures contribute to organisational cost savings on managerial level, improved communications and resulted in a fewer levels between top management and the bottom of hierarchy.
Organisational behaviour is concerned with people in organisations, and management relates to achieve organisational objectives, and since the success of organisation relies on human input, organisational behaviour is a fundamental segment of management (Mullins, 2002). According to Koontz and Weihrich (1990) “Management is the process of designing and maintaining an environment in which individuals, working together in groups, efficiently accomplish selected aims”. In general, ‘Management’ is the process of achieving organisational goals through people.
The principal part of the study of organisation and management is development of management thinking and evaluate management theory (Ivancevich et al, 1994). Effectiveness and efficiency of organisation is strongly contributed to management, therefore understanding of fundamental concepts of management models and principles is necessary (Lawrence and Lorsch, 1967). Major trends in the development of organisational behaviour and management theory, based on four core approaches: classical (scientific management and bureaucracy), human relations, systems and contingency (Cole, 1995).
According to Berrien (1968) “An organization is an integrated system of interdependent structures and functions”. Peter Senge (1990) introduced systems approach to management which was to challenge the scientific theory. Although the scientific theory based on the hypothesis that an organisation was a closed system, systems concept is viewed as an open system which emphasise the total environment of the organisation (Lutans, 2011). In contrast, contingency model suggests that none of the classical management theories is the most effective in all situations (Burns and Stalker,1961).