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					                                                   1.1
                        Trends
•   Globalization of business
•   E-business
•   Workforce diversity
•   Contingent work
•   Virtual work: Telecommuting
•   Corporate social responsibility
•   Intellectual capital - source of competitive
    advantage
                                                       2.1
    FACTORS INFLUENCING INDIVIDUAL PERFORMANCE
                     MARS Model


                         ROLE
                      PERCEPTIONS




MOTIVATION

                                          INDIVIDUAL
                                          BEHAVIOR &
                                         PERFORMANCE
  ABILITY




                       SITUATIONAL
                      CONTINGENCIES
                                              2.2
Types of Work Related Behavior

•   Task performance
•   Exhibiting organizational citizenship
•   Counterproductive work behaviors
•   Joining & staying with the organization
•   Maintaining work attendance
       Values Across Cultures          2.3



•   Individualism vs collectivism
•   Power distance
•   Uncertainty and risk avoidance
•   Achievement vs nurturing orientation
                                         2.4
The “Big Five” Personality Traits

 •   Extraversion
 •   Agreeableness
 •   Conscientiousness
 •   Emotional stability (neuroticism)
 •   Openness to experience
                                          2.5
Additional Important Personality Traits

   •   Locus of control
   •   Self esteem
   •   Self monitoring
   •   Tolerance for risk
   •   Type A/Type B
   •   Need for achievement
The Perceptual Process                3.1



        Environmental Stimuli

 Feeling Hearing Seeing Smelling Tasting


          Selective Attention

Perceptual Organization & Interpretation

        Attitudes and Behavior
                                                              3.2
Perceptual Inaccuracy - Negative Ramifications
       1)   Poor Decisions
       2)   Inaccurate Communication
       3)   Interpersonal Conflict
       4)   Selection & Promotion - Poor Choices

Michigan Study

Item                  Asked Supervisor             Asked Subordinate

Gives privileges              52%                        14%
Gives more responsibility     48%                        10%
Gives praise                  80%                        14%
Gives more interesting work   51%                         5%
                                               3.3

Types of Perceptual Inaccuracy
• Selective attention
• Categorical thinking (perceptual grouping)
• Mental models
• Social identity
• Stereotyping
• Attribution error
• Self-fulfilling prophecy
• Primacy effect
• Recency effect
• Halo effect
• Projection bias
                                                3.4
              Impression Formation
•   Nonverbal cues; physical appearance
•   Impressions tend to be unified
•   Impressions tend not to change
•   Negative info - greater weight
•   Attitude similarity - positive impression
                                                         3.5
Reinforcement Theory/ General Principles
Reinforcement Theory       General Principles
• Classical conditioning   • Not all rewards are
• Operant conditioning       reinforcers
• Observation learning     • Law of contingent
                             reinforcement
                           • Law of immediate
                             reinforcement
                           • Law of reinforcement size
                           • Law of reinforcement
                             deprivation
                           • Shaping
                           • Extinction
                                                                    3.6
             Contingencies of Reinforcement



Behavior
                   Positive                           Negative
Increases/                                          Reinforcement
Maintained      Reinforcement



                  Punishment          Extinction      Punishment
Behavior
                (by application)                     (by removal)
Decreases



             Consequence               No          Consequence
             is introduced         consequence      is removed
                                 3.7
    Schedules of Reinforcement

•   Fixed interval
•   Variable interval
•   Fixed ratio
•   Variable ratio
                                      4.1


             Emotional Intelligence

•   Self awareness
•   Social awareness
•   Self management
•   Relationship management
                                                4.2
        Types of Job Satisfaction

•   Satisfaction with coworkers
•   Satisfaction with pay
•   Satisfaction with promotional opportunity
•   Satisfaction with management
•   Satisfaction with work
                                  4.3

 Correlates of Job Satisfaction

• Mentally Challenging Task
• Equitable Rewards
• Supportive Working Conditions
• Supporting Coworkers
• Personality /Skills/Job Fit
• Genetics
                     Responses to Job Dissatisfaction        4.4
                                Active



              Exit                              Voice




Destructive                                              Constructive




                                               Loyalty
          Neglect




                                Passive
                                            FIGURE 1                                        4.5
        MODEL FOR THE MEASUREMENT OF HUMAN RESOURCE
                     REPLACEMENT COSTS
     RECRUITMENT

       SELECTION
                                      DIRECT
                                      COSTS
        HIRING

      PLACEMENT                                               ACQUISITION COSTS


   COST OF PROMOTION                 INDIRECT
OR TRANSFER FROM WITHIN                COSTS


   FORMAL TRAINING
   AND ORIENTATION                    DIRECT
                                      COSTS
                                                                                          POSITIONAL
  ON-THE-JOB TRAINING
                                                               LEARNING COSTS            REPLACEMENT
                                                                                             COST
                                     INDIRECT
 COST OF TRAINER’S TIME                COSTS


    SEPARATION PAY                    DIRECT
                                      COSTS
                                                              SEPARATION COSTS
   LOSS OF EFFICIENCY
  PRIOR TO SEPARATION                INDIRECT
COST OF VACANT POSITION                COSTS
     DURING SEARCH


      Source: Flamholtz, E.G. Human Resource Accounting (Encino, CA: Dickenson, 1974).
                                             4.6


    Financial Factors Influencing Turnover

•   Competitive salaries
•   Benefits plan
•   Financial incentives
•   Deferred compensation
•   Retirement system
•   ESOP
                                        4.7
                Factors in the Work
              Environment & Retention

•   Realism in Job Interviews
•   Promotional Opportunities
•   Work Assignments
•   Autonomy
•   Manager’s Human Relations Skills
•   Quality of Teamwork
•   Resource Adequacy
•   Higher Order need fulfillment
•   Unit Performance
•   Goal Congruence
                                                                                         4.8


          EVALUATION OF EXISTING JOB
A.
                                                    a) alternative forms of
          EXPERIENCED JOB SATISFACTION-                 withdrawal, e.g. absenteeism,
B.                                                      passive job behavior
                 DISSATISFACTION


             THINKING OF QUITTING
C.


D.     EVALUATION OF EXPECTED UTILITY
       OF SEARCH AND COST OF QUITTING


                                                     b) non-job related factors, e.g.
E.   INTENTION TO SEARCH FOR ALTERNATIVES               transfer of spouse, may
                                                        stimulate intention to search


F.         SEARCH FOR ALTERNATIVES
                                                     c) unsolicited or highly visible
                                                     alternatives    may stimulate evaluation
G.       EVALUATION OF ALTERNATIVES
                                                     d) one alternative may be withdrawal
                                                        from labor market
H.      COMPARISON OF ALTERNATIVES
             VS. PRESENT JOB

I.
            INTENTION TO QUIT/STAY

J.
                  QUIT/STAY                           e) impulsive behavior


       FIGURE 1. THE EMPLOYEE TURNOVER DECISION PROCESS.
                          5.1
Maslow’s Need Hierarchy



            Self
        Actualization
           Esteem
          Love &
         Belonging
          Security
        Physiological
                                                          5.2


                    Two Factor Theory

Dissatisfiers                       Motivators

•   Salary                          •   Achievement
•   Job Security                    •   Recognition
•   Working Conditions              •   Responsibility
•   Status                          •   Advancement
•   Company Policies                •   Work Itself
•   Quality of Tech. Supervision    •   Personal Growth
•   Quality of Coworker Relations
•   Relationship with Supervisor
                                                             5.3


        Mean Levels of Dissatisfaction of Needs
Level       Security   Social   Esteem   Autonomy   Self-Actual
President     .26       .34      .28       .18         .63
VP            .45       .29      .45       .55         .90
Upper-Middle .41         .33     .66       .87        1.12
Lower-Middle .38         .32     .71       .96        1.17
1st level     .82        .56    1.15      1.40        1.52
                                                         5.4

         Need for Achievement

•   Like to assume responsibility for solving problems
•   Tend to set moderate, challenging goals
•   Tend to take calculated risks
•   Desire periodic feedback on performance
                                                                               5.5

              GROWTH
                               SELF-                         WORK
                                           N. ACH        (intrinsic factors)
                           ACTUALIZATION
                                                          ACHIEVEMENT

                                                          RESPONSIBILITY

  HIGHER
                              ESTEEM       N. POWER      OPPORTUNITY
  ORDER                                                  FOR GROWTH
   NEEDS
                                                          ADVANCEMENT
                            LOVE &                        RECOGNITION
             RELATIONSHI   BELONGING                         STATUS
             P                             N.
                                                               INTER-
                                           AFFILIATION       PERSONAL
                                                              RELATIONS
BIOLOGICAL                  SECURITY
   NEEDS     EXISTENCE
                                                            SUPERVISION
                                                              COMPANY
                                                              POLICIES
                                                            JOB SECURITY
                           PHYSIOLOGICAL
                                                            WORKING
                                                           CONDITIONS


             ALDERFER      MASLOW          McCLELLAND      HERZBERG
                                                                        5.6
                             EXPECTANCY THEORY

                                                 INSTRUMENTALITY




                                                                   OUTCOME D

(E - P EXPECTANCY)   (P - O EXPECTANCY)          OUTCOME A


                                                                   OUTCOME E




        EFFORT           PERFORMANCE             OUTCOME B




                                                 OUTCOME C
                                                                    5.7


                     Expectancy Theory
• Effort-Performance Expectancy - Perceived probability that a given
  level of effort will result in a given level of performance. (0-1)
• Performance-Outcome Expectancy - Perceived probability that a given
  level of performance will result in a given outcome (0-1)
• Valence - Value of the outcome (-3 - +3)
• Instrumentality - Relationship between a first level outcome and a
  second level outcome (-1 - +1)
• M = E1 Σ E2 Vi
• where: Vi = Σ IJ VJ and,
• E1 = Effort-Perf Expectancy
• E2 = Perf-Outcome Expectancy
                                         5.8


       Management by Objectives

Process
• Managers provide subs with framework
• Sub’s propose objectives
• Joint goal setting
• Determine measures
• Conduct periodic reviews
• Annual performance appraisal
                                            5.9



       Characteristics of Effective Goals

•   Specific goals
•   Relevant goals
•   Challenging goals
•   Goal commitment
•   Goal participation
                                                      5.10


               Advantages of MBO

•   Clarify employee job requirements
•   Directs work activities toward org. goals
•   Improves manager-subordinate communication
•   Facilitates objective evaluation of performance
•   Stimulates employee motivation
•   Increases subordinate commitment to goals
    through participation
                                                               5.11


          Potential Problems with MBO

•   Performance not easily measured in some jobs
•   Neglect aspects of job which are not easily quantifiable
•   Insufficient support from upper management
•   Non acceptance of goal by subordinate
•   Procedures can be time consuming
•   Authoritarian administration with illusory participation
•   Failure to integrate with reward system
                      EQUITY THEORY             5.12



INPUTS      EFFORT, EDUCATION, EXPERIENCE,
            =
            SENIORITY, ETC.
OUTCOMES = SALARY, BENEFITS, ETC.
EQUITY =   PERCEIVED EQUIVALENT INPUT/OUTCOME
           RATIO WITH REFERENTS
                         Op           Or
                         Ip           Ir
                         Op            Or
INEQUITY =
                         Ip            Ir
ratios perceived to
be nonequivalent
                                                  5.13
              Potential Outcomes

Under reward                • Over reward
• Decreased effort          • Increase effort
• Attempt to increase       • Cognitive distortion of
  outcomes                    I&O
• Cognitive distortion of   • Alter referent’s inputs
  I&O                       • Ignore situation
• Quit, transfer,
  absenteeism
• Alter referent’s inputs
• Ignore situation
                                           6.1
                    Financial Incentives
Employment/Seniority
   Fixed pay
   Employee benefits
   Paid time off
Job Status
   Promotion-pay increase
   Status-based benefits
Competencies
   Pay increase based on competency
   Skill based pay
Task performance
   Commissions
   Merit pay
   Gainsharing
   Profit sharing
   Stock options
                                               6.2



          Improving Reward Effectiveness

•   Link rewards to performance
•   Ensure that rewards are relevant
•   Use team rewards for interdependent jobs
•   Ensure that rewards are valued
•   Watch out for unintended consequences
                                           6.3


         Advantages of Specialization

•   Allows workers to learn task rapidly
•   Performance proficiency
•   Training facilitated
•   Replacement facilitated
•   Reduces supervisory demands
                                        6.4

          Unintended Ramifications of
            Excessive Specialization

•   Lack of motivation
•   Alienation
•   Decreased work quality
•   Absenteeism
•   Turnover
•   Anti-social behavior
•   Boredom
•   Decreased job satisfaction
                                             6.5


             Herzberg’s Motivators

•   Opportunities for achievement
•   Opportunities for recognition
•   Increased responsibility
•   Opportunities for advancement
•   The work itself
•   Opportunities for growth & development
                                                         6.6


          Herzberg’s Recommendations
• Increase the accountability of individuals for their
  own work
• Give a person a complete natural unit of work
• Allow employees as much control over work as
  possible
• Grant the employee additional authority
• Maker periodic reports directly to the employee
  rather than to the supervisor
• Introduce new and more difficult tasks
• Create opportunities for employees to become
  experts in their specialized areas
                                                      6.7

   CORE JOB         CRITICAL PSYCH.       OUTCOMES
  DIMENSIONS            STATES


  SKILL VARIETY

                    MEANINGFULNESS     HIGH MOTIVATION
  TASK IDENTITY


TASK SIGNIFICANCE

                                       HIGH QUALITY
                                       PERFORMANCE


                      RESPONSIBILITY
   AUTONOMY                             HIGH JOB
                                       SATISFACTION


   FEEDBACK           KNOWLEDGE OF
                         RESULTS       LOW ABSENTEEISM
                                         & TURNOVER


                       GROWTH NEED
                        STRENGTH
                                                        6.8


     Potential Problems with Job Redesign

•   Distrust on the part of employees
•   Some employees fulfill higher order needs outside
•   Individual differences in higher order needs
•   Some employees cannot handle more
    responsibility
•   Management - fear loss of control
•   Cost - if retooling necessary
•   Initial dip in productivity
•   Technology limits applicability
                                  7.1
         Work Related Stressors
Interpersonal stressors
Role related stressors
 – intersender
 – intrasender
 – person-role
 – role overload
 – role ambiguity
 Task control stressors
 Organizational/Physical
   environment stressors
                                                    7.2



    Individual Differences Associated with Stress

•   Knowledge & Skills
•   Coping skills
•   Resilience
•   Type A/Type B
                                      7.3



             Consequences of Stress

• Physiological consequences
• Psychological consequences
• Behavioral consequences
                                         7.4
    Stress Management Strategies

•   Remove the stressor
•   Withdraw from the stressor
•   Change stress perceptions
•   Control the consequences of stress
•   Receive social support
                                  9.1
           Types of Teams

•   Departmental teams
•   Production or service teams
•   Self directed work teams
•   Advisory teams
•   Project teams
•   Skunkworks
•   Virtual teams
•   Communities of practice
                                    9.2


             Task Interdependence

• Pooled interdependence
• Sequential interdependence
• Reciprocal interdependence
                        9.3


     Team Development

•   Forming
•   Storming
•   Norming
•   Performing
•   Adjourning
                                                                                                                 9.4

                                                                                                             
                                                                                                    Adjourning
                                                                                       Performing
Team Maturity
                                                                       Norming

(Efficient/Effective)                                Storming

                                      Forming


                                                         Time


                                  Oversimplification: Punctuated Equilibrium



                                                          Storming         Higher
  Performance
                                                                          Performing
                        Forming            Low
                        Norming         Performing




                                                                Time
                                                                9.5
                  JACKSON’S GROUP NORMS MODEL

                                           c
approval   +3                              X



                                          b
                                                            a
           0




                  d
disapproval - 3


                               PERFORMANCE, ETC.

                         a)   INTENSITY
                         b)   RANGE OF TOLERABLE BEHAVIOR
                         c)   POINT OF MAX RETURN
                         d)   CRYSTALIZATION
                                      9.6
Influences on Team Cohesiveness

•   Member similarity
•   Team size
•   Member interaction
•   Difficulty of entry
•   Team success
•   External competition/challenges
                                            9.7


     Consequences of Team Cohesiveness

•   Productivity depends on norms
•   Increased conformity to norms
•   Increased interpersonal influence
•   Increased satisfaction
•   Increased cooperation & communication
                                                         9.8
         The Effect of Cohesiveness on Performance




NORMS SUPPORT
COMPANY                                     HIGH PERF.
GOALS             MODERATELY HIGH PERF.



NORMS CONFLICT                              LOW PERF.
                  MODERATELY LOW PERF.
WITH COMPANY
GOALS

                 LOW                                     HIGH

                                   COHESIVENESS
                                         9.9
Strategies for Minimizing Social Loafing

    •   Form smaller teams
    •   Specialized tasks
    •   Measure individual performance
    •   Increase job enrichment
    •   Select motivated employees
                                         10.1
      Decision Making Process

•   Identify problem or opportunity
•   Choose the best decision style
•   Develop alternative solution
•   Choose the best solution
•   Implement the selected alternative
•   Evaluate decision outcomes
                                               10.2


     Team Decision Making - Advantages

•   Pooled Expertise
•   Greater number of approaches to problems
•   Greater acceptability by participants
•   Greater comprehension by participants
•   Smoother implementation
                                                   10.3
Problems/Constraints in Team Decision Making

•   Time constraints
•   Evaluation apprehension & status differences
•   Conformity to peer pressure
•   Groupthink phenomenon
•   Group polarization (risky shift)
                                                   10.4



    Improving Creativity in Team Decision Making

•    Constructive conflict
•    Brainstorming
•    Electronic brainstorming
•    Delphi method
•    Nominal group technique
                                                                       10.5
 MAJOR TYPES OF LEADERSHIP BEHAVIOR IN DECISION
 GROUPS


TASK-ORIENTED BEHAVIOR           SPECIFIC OBJECTIVE
1.   INITIATING-STRUCTURE        GUIDE AND SEQUENCE DISCUSSION
2.   STIMULATING COMMUNICATION   INCREASE INFORMATION EXCHANGE
3.   CLARIFYING COMMUNICATION    INCREASE COMPREHENSION
4.   SUMMARIZING                 CHECK UNDERSTANDING & MONITOR PROGRESS
5.   CONSENSUS TESTING           CHECK ON AGREEMENT
GROUP-MAINTENANCE BEHAVIOR       SPECIFIC OBJECTIVE
1.   GATEKEEPING                 INCREASE AND EQUALIZE PARTICIPATION
2.   HARMONIZING                 REDUCE TENSION AND HOSTILITY
3.   SUPPORTING                  PREVENT WITHDRAWAL
4.   STANDARD SETTING            REGULATE BEHAVIOR
5.   PROCESS ANALYZING           DISCOVER AND RESOLVE PROCESS PROBLEMS
                                                    10.6
           Conducting a Group Meeting
•   Prepare an Agenda
•   Distribute the Agenda in Advance
•   Consult with Participants before Meeting
•   Get Participants to Review Agenda
•   Establish Time Parameters
•   Focus Discussion
•   Encourage Participation
•   Maintain a Balanced Style of Managing Meeting
•   Encourage the Clash of Ideas
•   Discourage the Clash of Personalities
•   Be an Effective Listener
•   Bring Proper Closure
                                                                           11.1
               Communication Process


           SENDER
                                                     RECEIVER


 Form                          Transmit
                     Encode               Receive               Decode
Message                        Message
                     Message              Encoded               Message
                                          Message




                               Transmit
                               Feedback    Encode                 Form
 Decode             Receive
Feedback            Feedback              Feedback              Feedback
                                                          11.2


           Channel Choice

Richness   Type of Message        Medium


Richest    Non-Routine       Face to Face
                             Video conference
                             Telephone
                             Instant messaging
                             Email, Memos, Letters
                             Newsletters

Lowest     Routine Clear     Bulletins, General Reports
                                                                                                                      11.3
                             Hierarchy of Media Richness




 Rich
 Medium                                                                                               Face-to-Face

                                                                                          Video Conference


                                                                                  Telephone

                                                                      Instant Messaging

                                                           Email; Letters

                                                 Weblogs
                                   Newsletters

                    Financial Statements
Lean Medium


              Routine                                          Communication                                    Nonroutine
               Clear                                             Situation                                      Ambiguous
                                                                  11.4


      Common Communication Problems

• Motivation to listen            • Language: Semantics
• Stereotyping                    • Failure to obtain feedback
• Source credibility              • Language: Jargon associated
• Differing frames of reference     with specialization
  (conflicting assumptions)       • Filtering
• Selective perception            • Status differences
• Communication apprehension      • Time pressures
• Jumping to conclusions          • Information overload
                                  • Condensation
                                  • Self disclosure
                                  • Defensiveness
                                      11.5
                Effective Listening
Sensing
 – Postpone evaluation
 – Avoid interruptions
 – Maintain interest
 Evaluating
 – Empathize
 – Organize information
 Responding
 – Show interest
 – Clarify the message
                                                    11.6

    Reducing the Negative Consequences of
          the Grapevine or Rumors

• Announce timetables for important decisions
• Explain decisions that appear inconsistent or
  secretive
• Discuss downside as well as upside of decisions
• Openly discuss worst case possibilities
                                                     12.1


               Power and Influence

• The power of B over A = The dependence of A on B
• The dependence of A on B is (1) proportional to A’s
  motivational investment in the outcomes mediated by
  B; and (2) inversely proportional to the availability
  of those outcomes to A outside the A-B relation
                                                   12.2

  Means by which a less powerful party (A) can
 balance power with a more powerful party (B):

• A reduces motivational investment in outcomes
  mediated by B
• A gains access to alternative sources to obtain
  outcomes
• A gains mediation over outcomes of importance to
  B
• A limits B’s access to alternative sources of goal
  attainment
                                  12.3


                 Bases of Power

•   Reward power
•   Coercive power
•   Legitimate power
•   Expert power
•   Referent power
                             12.4
    Contingencies of Power

•   Substitutability
•   Centrality
•   Discretion
•   Visibility
                                       12.5
          Types of Influence Tactics

•   Silent authority
•   Assertiveness
•   Information control
•   Coalition formation
•   Upward appeal
•   Ingratiation/Impression mgmt.
•   Persuasion
•   Exchange
                                             12.6
            Additional “Political” Tactics
•   Scapegoating
•   Cultivating networks
•   Stalling in decision making
•   Empire building
•   Garnering others’ ideas
•   Cooptation
                                                                                                12.7
           IS A POLITICAL ACTION ETHICAL


                          Yes      Unethical


      Question 1                                                                       Yes
                          No           Question 2       Yes                                   Ethical
Is the political action                                                  Question 3
                                Does the political
motivated by self-                                                 Is the political
                                action respect the                                       No   Unethical
serving interests to                                               activity fair and
                                rights of the
the exclusion of the                                               equitable?
                                individuals affected?
organization’s goals?
                                                              No
                                                                    Unethical
                                            13.1


             Disfunctions of Conflict

•   Efforts diverted from goal attainment
•   Increased tension and stress
•   Development of stereotypes
•   Breakdown in understanding
•   Decreased cooperation
•   Employee turnover
                                                      13.2


         Potential Functions of Conflict

•   Can stimulate positive change
•   Potentially superior group decision making
•   If it takes the form of competition: motivation
•   Calls attention to problems that exist
                                                   13.3
               CONFLICT INTENSITY

ANNIHILATORY            OVERT EFFORTS TO DESTROY
  CONFLICT              OTHER PARTY


                        AGGRESSIVE PSYCHOLOGICAL OR
                        PHYSICAL ATTACKS


                        THREATS AND ULTIMATUMS


                        ASSERTIVE VERBAL ATTACKS


                        OVERT QUESTIONING OR
                        CHALLENGING OF OTHERS


NO CONFLICT             MINOR DISAGREEMENTS OR
                        MISUNDERSTANDINGS
                                            13.4


     Sources of Conflict in Organizations

•   Incompatible goals
•   Differentiation
•   Task interdependence
•   Scarce resources
•   Ambiguity
•   Communication problems
                       CONFLICT RESOLUTION STYLES               13.5


HIGH         FORCING                       COLLABORATING/
                                           PROBLEM SOLVING




ASSERTIVE-                      COMPROMISING
  NESS




              AVOIDING                         ACCOMMODATING/
                                               YIELDING
LOW

             LOW                                       HIGH
                             COOPERATIVENESS
                                               13.6
       Conflict Management Strategies
•   Emphasize superordinate goals
•   Reducing differentiation
•   Improving communications & understanding
•   Reducing task interdependence
•   Increasing resources
•   Clarifying rules & procedures
•   Creating the fear of an external threat
•   Appeal to hierarchy
•   Creating liaison positions
•   Transfer or rotate personnel
•   Training in conflict resolution methods
•   Merge interdependent departments
                                                                                                                              13.7
                                    Distributive Bargaining

   Party A’s Aspiration Range


                                                           Settlement Range


                                                                                                 Party B’s Aspiration Range


Party A’s                               Party B’s                             Party A’s
                                                                                                                              Party B’s
target point                            resistance point                      resistance point
                                                                                                                              target point
[Buyer]                                                                                                                       [Seller]




  Party A = Buyer
                Target Pt. = as low as buyer thinks he/she can go
                Resistance Pt. = the highest price buyer will agree to


   Party B = Seller
                    Target Pt. = as high as seller thinks he/she can go
                    Resistance Pt. = the lowest price seller will agree to
                                                        13.8


                Effective Negotiating

•   Begin with a positive concession
•   Address problems not personalities
•   Pay little attention to initial demands or offers
•   Create a climate of trust
•   Take a long term perspective
                                       13.9


           Negotiation Bluff Tactics

•   Commitment to a deadline
•   Commitment to a third party
•   Commitment to a policy
•   Commitment to a precedent
•   Stalling
•   Suggest an alternative source
•   The threat
•   The promise
                                            14.1


         Leadership Competencies (Traits)

•   Emotional intelligence
•   Integrity
•   Drive
•   Leadership motivation
•   Self confidence
•   Intelligence
•   Knowledge of the business
                                                                        14.2


                  Initiating Structure

• Sets standards for performance   • Insists that people follow
• Emphasizes meeting deadlines       standard operating procedures
• Effectively schedules work       • Emphasizes the quality of work
• Pressures weaker performers to   • Sees to it that group members
  increase output                    are working up to their capacity
• Provides negative feedback       • Sees to it that the work among
  when work quality is poor          group members is effectively
• Sees that a group member is        coordinated
  rewarded for a job well done     • Gives advance notice of
• Lets group members know what       changes
  is expected of them              • Gives sound technical advice
                                                                          14.3

                       Consideration
• Expresses appreciation when a group member does a good job
• Gets the approval of the work group on important matters before
  proceeding
• Is friendly and can be easily approached
• Shows concern when people have personal problems
• Is open to changing his/her mind when group members disagree
• Never criticizes people in the presence of others
• Shows encouragement to weaker performers
• Stands up for people in his/her group even though it may be unpopular
• Never changes the duties of the group members without first
  discussing it with them
                                                                          14.4

                  Consideration continued
•   Puts suggestions that are made by group members into operation
•   Stresses the importance of high morale in the group
•   Does personal favors for group members
•   Treats subordinates as equals
•   Makes subordinates feel at ease when talking to them
•   Does little things to make it pleasant to be a member of the team
•   Finds time to listen to subordinates
•   Looks out for the personal welfare/career development of individual
    group members
                                                           14.5
               SITUATIONAL LEADERSHIP MODEL




                 III                                        II
HIGH                                           SELLING
                       PARTICIPATING

  PEOPLE
ORIENTIATION
LOW
                 IV    DELEGATING               TELLING
                                                            I


                            LOW                     HIGH

                                       TASK ORIENTATION
                                                           14.6
       HOUSE’S PATH-GOAL THEORY
• Find out what outcomes your subordinates are trying to
obtain from their jobs and the organization

• Reward subordinates for high performance and goal
attainment with the outcomes they desire

• Clarify the paths to goal attainment for subordinates,
remove any obstacles to high performance, and express
confidence in subordinates capabilities

• Four types of leadership behaviors:
    –Directive behavior (initiating structure)
    –Supportive behavior (consideration)
    –Participative behavior
    –Achievement oriented behavior
           Path-Goal Leadership Theory                               14.7



                     Employee Contingencies
                       Skills & experience
                        Locus of control




Leader Behaviors                                 Leader Effectiveness
    Directive                                    Employee motivation
   Supportive                                    Employee satisfaction
  Participative                                   Leader acceptance
 Ach. oriented




                   Environmental Contingencies
                          Task structure
                         Team dynamics
                                                                           14.8


             Contingencies of Path-Goal Theory
                 Directive    Supportive     Participative   Achievement
                                                             Oriented
Employee
Contingencies
Skill &          Low          Low            High            High
Experience
Locus of         External     External       Internal        Internal
Control
Environmental
Contingencies
Task Structure   Nonroutine   Routine        Nonroutine         ?


Team Dynamics Negative        Low            Positive           ?
              Norms           Cohesiveness   Norms
                                                                                 14.9
         Participative Management Decision Tree
•   AI. You solve the problem or make the decision yourself, using information
    available to you at the time.
•   AII. You obtain the necessary information from your subordinates, then
    decide the solution to the problem yourself. You may or may not tell your
    subordinates what the problem is in getting the information from them. The
    role played by your subordinates in making the decision is clearly one of
    providing necessary information to you, rather than generating or evaluating
    alternative solutions.
•   CI. You share the problem with the relevant subordinates individually, getting
    their ideas and suggestions without bringing them together as a group. Then
    you make the decision, which may or may not reflect your subordinates’
    influence.
•   CII. You share the problem with your subordinates as a group, obtaining their
    collective ideas and suggestions. Then you make the decision, which may or
    may not reflect your subordinates’ influence.
•   GII. You share the problem with your subordinates as a group. Together you
    generate and evaluate alternatives and attempt to reach agreement (consensus)
    on a solution. Your role is much like that of chairman. You do not try to
    influence the group to adopt “your” solution, and you are willing to accept and
    implement any solution which has the support of the entire group.
                                       14.10


Participative Management Decision Tree

•   1.   QR: Quality Requirement
•   2.   CR: Commitment Requirement
•   3.   LI: Leader Information
•   4.   ST: Problem Structure
•   5.   CP: Commitment Probability
•   6.   GC: Goal Congruence
•   7.   CO: Subordinate Conflict
•   8.   SI: Subordinate Information
                                                                                                                     14.11
     QR     QUALITY REQUIREMENT:           How important is the technical quality of this decision?
     CR     COMMITMENT REQUIREMENT:        How important is subordinate commitment to the decision?
      LI    LEADER’S INFORMATION:          Do you have sufficient information to make a high-quality decision?
      ST    PROBLEM STRUCTURE:             Is the problem well structured?
     CP     COMMITMENT PROBABILITY:        If you were to make the decision by yourself, is it reasonably certain
                                           that your subordinate(s) would be committed to the decision?
      GC    GOAL CONGRUENCE:               Do subordinates share the organizational goals to be attained in
            solving                        this problem?
     CO     SUBORDINATE CONFLICT:          Is conflict among subordinates over preferred solutions likely?
      SI    SUBORDINATE INFORMATION:       Do subordinates have sufficient information to make a high-quality
                                           decision?

                                                          CP                                                        AI
                                                                GC
                                                                                                      SI            GII

                                                                CP                                                  CII
                                      LI           ST                GC                               SI
                                                                                                                    GII
                                                                                                 CO
                                                                     GC                                             CII
                                                                                            NO
                                                           CP                                                       AII
                           CR
                                                                     GC                CO                           CI
                                              ST                                                                    CII
                                                                                 NO
                                LI
STATE THE    QR
PROBLEM                                                                                                             AI
                      CR
                                                           CP                               NO
                                                                                                                    GII

      THE REVISED LEADER PARTICIPATION MODEL (TIME-DRIVEN DECISION TREE-GROUP PROBLEMS)
                                        14.12



         Transformational Leadership

•   Creating a vision
•   Communicating the vision
•   Modeling the vision
•   Building commitment to the vision
                                                           14.13



Transformational/Charismatic Leadership

•   Revolutionary ideas - Change status quo
•   Present vision of change (clear vision of future)
•   Extraordinary achievements/heroism in past
•   Speak with authority
•   Personal sacrifice for the organization
•   Must have conduciveness - a need for change
•   Transforms followers’ values
•   Instill confidence in subordinates/followers
•   Followers’ affection for leader
•   Emotional involvement of followers in goals or mission of
    organization
                                                                    14.14

Transformational/Charismatic Leadership
              Continued
• If greater discrepancy between status quo and future goal
  or vision - more charisma
• Goal or vision must better their lives in some way; it must
  be for them
• Proves not personal interest by incurring great personal
  risk or cost
• Demonstrate concern for followers’ needs rather than own.
  Total commitment to the mission with no self gain. The
  greater the cost, risk, or sacrifice - the greater the trust of
  the followers
                                                               14.15


Transformational/Charismatic Leadership
              Continued
• Acts of heroism and self-sacrificing behaviors must be
  novel, unconventional and out of the ordinary. This
  evokes respect and admonition in followers. This leads to
  the belief that the leader has almost superhuman qualities
• Realistic assessment of environmental resources and
  constraints affecting the realization of the vision
• Expression of high energy and persistence, unconventional
  and risky behavior, heroic deeds and personal sacrifices
  become contagious to followers
• Vision includes meeting needs or latent desires of
  followers
                                           14.16



             Disciplinary Action

Potential Negative Effects of Punishment
• Emotional Reactions
• Sabotage
• Temporary Change Only
• Turnover
• Absenteeism
• Suppression of Initiative
                                             14.17


      Effective Use of Disciplinary Action

•   Praise in public, punish in private
•   Be instructive
•   Punishment should be immediate
•   Be specific about what to change
•   Punish the behavior, not the person
•   Be consistent
                                                 14.18



            Progression of Penalties

•   Oral warning
•   Oral warning noted in employment record
•   Written warning noted in employment record
•   Suspension from job
•   Discharge
                                         15.1



        Uses of Performance Evaluation

•   Compensation Decisions
•   Performance Feedback
•   Training needs assessment
•   Promotion Decisions
•   Human Resource planning
•   Retention/Discharge
•   Research
                                           15.3


    Performance Evaluation - Measurement
               Characteristics
•   Completeness
•   Objectivity
•   Responsiveness
•   Reflects Objectives
•   Cost Effectiveness
                                                15.4



       Methods of Performance Evaluation

Rating Scales
        • Graphic rating scales
        • Job dimension scales
        • Behaviorally anchored rating scales
   –   MBO
   –   Ranking
   –   Checklist
   –   Essay
   –   Critical incident
                                                     15.5



                  Legal Issues

• Does a job analysis/job description exist?
• Is the system based on personality traits rather
  than job related behaviors?
• Was there a failure to share the results of the
  performance evaluation with the employee?
• Was the employee provided adequate counseling
  to make corrections in performance or behavior?
• Was due process violated?
                                       16.1



              Organizational Culture

•   Artifacts
•   Shared Values
•   Shared Assumptions
•   Crystallized Norms
                                                     16.3



Functions of Culture/Culture as a Liability

• Function of Culture     • Culture as a Liability
   – Distinguishes the      – Barrier to change
     organization from      – Barrier to diversity
     others                 – Problem in mergers
   – Sense of identity        or aquisitions
   – Commitment
   – Enhances stability
   – Creates standards
     for behavior
                                                16.4



    Strengthening Organizational Culture

•   Actions of founders and leaders
•   Introducing culturally consistent rewards
•   Aligning artifacts
•   Selecting and socializing employees
                                                            16.5
    Mergers & Acquisitions: Strategies for
     Merging Organizational Cultures

ASSIMILATION           Acquired company embraces
                         acquiring firm’s culture

DECULTURIZATION        Acquiring firm imposes its culture
                         on unwilling acquired firm


INTEGRATION            Combining two cultures into a new
                         composite culture


SEPARATION             Merging companies remain distinct
                         with minimal exchange of
                         culture or organizational
                         practices
JAPANESE CULTURE & MANAGEMENT
                                           16.6
• PARTICIPATIVE MANAGEMENT
• WORK ETHIC
• CONCERN FOR EMPLOYEES
• ESPRIT DE CORPS
• DECISION MAKING BY CONSENSUS
• JOB ENRICHMENT
• INFORMAL IMPLICIT CONTROL
• LIFETIME EMPLOYMENT
• LAYOFFS ARE MINIMIZED
• PARTNERSHIP - BUSINESS, GOV’T, LABOR
• LONG RANGE PLANNING
• COLLECTIVE RESPONSIBILITY
• MINIMAL INVENTORY
• CONTINUOUS IMPROVEMENT OF PRODUCTION
• NON-SPECIALIZED CAREER PATHS FOR MGR’S
• SLOW EVALUATION & PROMOTION
                                         17.1



            Forces Resisting Change

•   Direct costs
•   Saving face
•   Fear of the unknown
•   Breaking routines
•   Incongruent organizational systems
•   Incongruent team dynamics
                                         17.2



       Reducing the Restraining Forces

•   Communication
•   Learning/training
•   Employee involvement
•   Stress management
•   Negotiation
•   Coercion
                                               17.3



       Approaches to Organizational Change

• Action research approach (survey feedback)
• Appreciative inquiry
• Parallel learning structures
                                                                     17.4

             Appreciative Inquiry Process


DISCOVERY            Identifying the “best” of “what is” currently

DREAMING             Envisioning “what might be”

DESIGNING            Engaging in dialogue about “what should be”

DELIVERING           Developing objectives about “what will be”
                                        17.5



        Quality Management Principles

•   Customer focus
•   Employee involvement for quality
•   Continuous improvement
•   Defect prevention
•   Performance measurement
•   Continuous learning

				
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