What Is Organizational Behavior?

All businesses have an internal culture that is unique to their company. Each employee contributes not only a certain skill set but also a personality with inherent values and beliefs, and those values and beliefs will determine how they will interact in work groups, with other employees, and toward management. Organizational Behavior (OB) is the multidisciplinary study of the employee interactions and the organizational processes that seek to create more efficient and cohesive organizations.

In the field of Organizational Behavior, researchers have found that scientific approaches can be applied to personnel management to bring out the best in employees and improve the overall success of an organization. Researchers in the disciplinary fields of psychology, sociology, social psychology, anthropology, political science and economics have all contributed to the research of Organizational Behavior.

Why Is Organizational Behavior Important?

During their careers, most people have worked for a company where people didn’t get along, where no one knew what the expectations were, or where the boss failed to promote teamwork. The company most likely lacked a strong OB model.

Organizational behavior can help employees navigate a business’s culture as well as help managers better understand how that culture helps or hinders employee productivity and retention. OB can also help managers evaluate a potential job candidate’s skills and personality during the hiring process, allowing human resources to find the best fit for departments within the company. While there is never one exact way to assess these things, OB theory offers a set of guidelines to help organizations create a positive and vibrant internal culture.

One of the main goals of OB is to understand what motivates employees. How organizations measure job satisfaction varies, but most common metrics include a fair and equitable reward system, compelling work, enjoyable working conditions and good supervisors. By understanding what motivates employees, managers can adjust their policies to increase job satisfaction, thereby increasing productivity.

OB not only helps employees understand themselves better, it also offers a roadmap for managers to improve all aspects of their organizations:

  • Improve job performance.
  • Increase job satisfaction.
  • Promote innovation.
  • Encourage leadership.
  • Improve customer service.
  • Encourage ethical behavior.
  • Create a positive work environment.

Depending on the challenges and desired outcomes, managers may use different tactics such as reorganizing workgroups, changing performance evaluations or modifying compensation structures. Understanding what motivates employees also plays a large part in how managers adjust company procedures or policies.

Not only does organizational behavior provide a roadmap for human resources and supervisors to manage more effectively, it also helps employees navigate an organization’s culture.

When a strong model of OB is in place, employees can understand themselves better and know how they can best flourish inside an organization. And managers are better able to predict how employees might react under differing circumstances and adjust accordingly.

Creating a culture where relationships are cooperative, employees feel valued and companies flourish is at the heart of organizational behavior.

Learn more about the USI online MBA program with a concentration in Human Resources.


Investopedia: Organizational Behavior – OB

Houston Chronicle: How to Explain the Importance of Organizational Behaviors

Leadership Archways: What Is Organizational Behavior and Why Does It Matter?

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