UGBA105: Organizational Behavior Fall 2006 Professor Jim Lincoln

1. Walter A. Haas School of Business University of California, Berkeley UGBA105: Organizational BehaviorFall 2006Professor Jim Lincoln

2. Class Agenda for Today Introduction to OB Course mechanics 2. Overview of topics

3. When organizations do well or poorly, what is the first explanation that comes to mind? The CEO did it! Beware of attribution bias! • The tendency to attribute causation/agency to the actions of individuals Organizational behavior teaches that the effectiveness of people in organizations depends on their situation-specific relationships with one another Louis V. Gerstner, CEO of IBM, 1993-2002

4. What Is Organizational Behavior? The Study of General/People Management The study of behavior and attitudes of individuals or groups in organizations (Micro OB) The study of structure and culture of org. in relation to their tasks and environments (Macro OB)

5. OB draws on all of social & behavioral science… • Psychology • Sociology • Economics • Political Science • Anthropology • History Even some engineering now and then…

6. Some OB journals • Practitioner-oriented: • Academy of Management Executive • Business Horizons • California Management Review • Harvard Business Review • Sloan Management Review • Scholar-oriented: • Academy of Management Journal • Administrative Science Quarterly • Journal of Applied Psychology • Organizational Behavior and Human Decision Processes • Organization Science • Strategic Management Journal

7. Some OB Gurus • Warren Bennis • Peter Drucker • Michael Hammer • Rosabeth Kanter • Raymond Miles • Henry Mintzberg • Tom Peters • Jeffrey Pfeffer

8. Research methods in OB run the social science gamut • Experiments (both lab and field) • Surveys • Ethnographies • Archival Research (documents & records)

9. How does OB differ from other fields of business education? • Finance, economics, accounting • Marketing • Operations • Strategy • Human resource management

10. How does OB differ from HR? • OB is a line, not a specialized staff, responsibility • Much OB management is CEO-level • Vision and culture • Re-orgs • OB is about principles, policies, & strategies • HR is more about tools and implementation

11. Why should business students study OB? • Managers • How to organize and motivate your employees • How to initiate and manage change • Entrepreneurs • You have the big idea, you have the venture capital lined up. How do you organize and motivate your team?

12. Why should business students study OB? • Consultants • problem-solving tool • useful for case interviews • Investors • will that merger work? • will that reorganization actually add shareholder value? • is that CEO as competent as s/he thinks s/he is?

13. Why should business students study OB? • Issues critical to managing your career: • understanding culture and person-job fit • Getting and using power and influence • implementing your ideas and goals

14. Some criticisms of OB • Isn’t it obvious or common-sensical? • Many things are “obvious” after-the-fact. Example: • The best form of organization is flat, flexible, & empowering • The best form of organization depends on the context (e.g., tasks, people, competition, technology, etc.) Beware of hindsight bias!

15. Other criticisms • OB might be important, but it’s an art, not a science • i.e., can’t be systematically analyzed or taught • Is only be learned by doing • Maybe it’s religion… • There is an element of preaching in OB • OB may be important for maintaining an organization, but it is not strategic Tom Peters as bible-thumping evangelist.

16. OB is strategicOB and HR are key to the development of critical & hard-to-imitate capabilities • Such capabilities refer to an organization’s core skills and knowledge that give it sustainable competitive advantage: allow it to better serve customers and clients than the competition • Examples: • Clear vision and strong culture • Motivated people • Effective teams and networks

17. There is abundant evidence that people management is key to competitive strategy and success Studies of IPOs among 200+ firms showed that people-centered practices were associated with faster time to IPO and higher survival rates. • Watson, Wyatt, an HR consulting firm, concluded that “Companies that link employee development to business strategy have 40% higher total share- holder returns than companies that do not.”

18. “All organizations now routinely say, ‘People are our greatest asset.’ Yet few practice what they preach, let alone truly believe it…” Peter F. Drucker (1909-2005)

19. Dilbert’s Perspective on HRM

20. “You got a problem with the guy in the cubicle next to you? I don’t care; shoot him” Marc Andreessen, Co-founder of Netscape

21. “In the new economy, competition is global, capital is abundant, ideas are developed quickly and cheaply, and people are willing to change jobs often. In that kind of environment…all that matters is talent…superior talent will be tomorrow’s prime source of competitive advantage.” E. Chambers et al. (1998). “The War for Talent.” The McKinsey Quarterly, 2-15.

22. The problem, then, is how to get, keep, and utilize talented people • It is not just a question of pay • Even talented people must be organized and led

23. Jack Welch as hands-on manager of talent “While analysts on Wall Street or GE's own investors view Welch's likely legacy as creating the world's most valuable company in stock market terms, Welch himself sees things quite differently. The man who spends more than 50% of his time on people issues considers his greatest achievement the care and feeding of talent. ''This place runs by its great people,'' says Welch. ''The biggest accomplishment I've had is to find great people. An army of them. They are all better than most CEOs. They are big hitters, and they seem to thrive here.'' “He believes he has to know people well enough to trust them and their judgments. Welch knows by sight the names and responsibilities of at least the top 1,000 people at GE.” John F. Welch, Jr. GE Chairman & CEO, 1981 to 2001 “How Jack Welch runs GE.” Business Week, May 29, 1998.

24. And some organizations get excellent results with merely “OK” people See C. A. O'Reilly III and J. Pfeffer: Hidden Value: How Great Companies Achieve Extraordinary Results With Ordinary People. Harvard Business School Press, 2000. Only 10% of people are in the top 10%. Great companies not only hire talent, they build it and unleash the energy and talent of all their people.

25. So how do they do it? What is the (general) manager’s job? (Kotter, 1996; Mintzberg, 1973; ) “No job is more vital to our society than that of the manager” (Mintzberg, 1975)”

26. Manager as engineer: trained technician who uses a professional body of knowledge to create formal systems that plot strategy, make decisions, incent people, and coordinate units in maximally efficient ways. Manager as leader: individual who leverages highly personal resources (energy, stamina, charisma, vision, warmth, charm, gregariousness, toughness, daring, know-how) to inspire, empower, and channel the actions of others. Management is Janus-faced: Janus: The Roman God of doorways

27. The historical thrust of management science and education has been to: Develop formal systems and tools that relieve managers of the personal work of leading

28. Sections on organization design & incentive systems represent the engineering perspective Sections on culture, leadership, networks, & power represent the leadership perspective The structure of the course reflects this dichotomy

29. How has the manager’s role changed in the new economy? Less a boss , more a coach, cheerleader, politician, networker, hustler --More a leader, less an engineer --More an entrepreneur, less a bureaucrat

30. Let’s get to down to business … So now that you’re psyched …

31. Reader and Website • Electronic Course reader available thru Catalyst • Course Website (login=ba105, pw=organize) • Instructor info • Syllabus • Supplementary readings • Useful links • Course announcements • Lecture powerpoints • Posted on the website the day before the class • Discussion section business

32. Class meetings • Thursday: • Introduce a new topic • Lecture/discussion • Tuesday (GSI’s Jennifer Kurkoski & Nydia MacGregor) • Class business • Review of lecture and readings • Case analysis • Videos & exercises • Team project discussions

33. Other course business • Enrollment issues • Go to the Undergraduate Program Office (S450) • This course uses instructor drop: • If you do not attend the section in which you are registered in the first two weeks you may be dropped from enrollment. • SORRY- NO SECTION SWITCHING • Arrival and attendance • Class attendance is important (roll taken in sections) • Arrive Thursday by 8:10AM. Late arrivals use rear door. • Email (contact GSI’s first; use your full name) • Face cards & name tents (see website announcements) • Class reps

34. Course Requirements • Class participation (15%) • In-class discussions, particularly of cases • Oral presentation on team projects • Team member ratings • Midterm and final exams (50%) • Take home essay exam (analysis of a case) • Objective (true-false/multiple choice) in-class exam • SORRY– NO CHANGE IN MIDTERM OR FINAL EXAM TIMES • Team project (30%) • You will be assigned to teams of 4-5 persons each • You will study OB problems/issues in a real organization • Oral presentation and paper (12-15 pages) • In general, all members will receive the same grade • Participation in research experiments (5%)

35. Course overview….

36. Schedule of topics Part 1: Introduction (1 week) An introduction to course themes The manager’s job and the congruence perspective Part 2: The (semi-) hard stuff: formal org (2 weeks) Strategic grouping, coordination and authority, designing and managing teams Part 3: The soft stuff: informal organization I (2 weeks) Leadership and culture

37. Course overview Part 4: Soft/hard and micro: Motivation, incentives, and decision-making (3 weeks) Part 5: Informal organization II (1 weeks) Politics and networks Part 6: Managing diversity at home and abroad (2 weeks)

38. Next Tuesday discussion session • Introduction to discussion section • Read and prepare to discuss: • What general managers do • Read Kotter article • The congruence model as a framework for organizational problem-solving • Read Nadler and Tushman chapter