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Managing People

C H A P TER 1
Introduction to Organizational Behaviour

LEARNING OUTCOMES After reading the material in this chapter, you should be able to: 1. Dene organizational behaviour and explain why it is important for managers. 2. Identify the four principles of quality management. 3. Dene the term e-business, and specify ve ways the Internet is affecting the management of people at work. 4. Describe the four layers of diversity in an organizations workforce. Explain three general diversity management practices. 5. Dene globalization and explain the OB research nding that is particularly signicant in this regard.

CANADAS TOP 100 EMPLOYERS SHOWING THE LOVE

Gone are the days of lifetime employment in exchange for lifetime commitment, says the Conference Board of Canada in a report on public trust, which states that the changing nature of the employeeemployer relationship is a factor contributing to a broader decline of trust in Canadas public institutions. Companies have been asking their workforce for exibility without providing compensation in return. While a more nimble workforce has allowed business to compete better in an increasingly global marketplace, this has come at a price. Workers have been advised that managing their work lives is their responsibility, that the vecareer lifetime is the norm. The end result has been the demise of employee loyalty. At the leading edge of enlightened employers are those who have renewed their focus on employee loyalty. But unlike in an earlier era of paternalistic bosses, todays best employers see the link between contented employees and the bottom line. They know that, soon, the strongest businesses will be those with the most engaged and stable workforces. For example, Dofasco now spends $15 million a year on training and development, much of it on a revitalized apprenticeship program. For each of the 200 to 250 apprentices in the companys system at any given time, Dofasco spends $250,000. The program is regarded as part of Dofascos competitive strategy and a way to keep the company viable. Its not just a noble thing to do, says Brian Mullen, director of human resources. Theres a solid business case. Hewlett-Packard is another company committed to its employees. Unlike many IT companies, where many workers are on contract, HP limits the length of contracts to a maximum of two years. At that point, a manager should know if the work being done is a core functionand if it is, the person doing it should become a permanent employee, says Paul Tsaparis, CEO of HPs Canadian operations. Employee loyalty and engagement is a critical success factor for us, Tsaparis says. By committing to full-time employees, you absolutely get back commitment from them. Not only are progressive employers looking forward and training the next generation of workers, but they are also using increasingly sophisticated methods to sell their companies as good places to work, to both current and potential employees. Borrowing from their marketing departments, some have started to think of themselves as brands, not with regard to consumers but to workers. Employer as a brand, says Richard Yerema, author of Canadas Top 100 Employers, is new this year. The recruiters are becoming marketers, adds Anthony Meehan, president of Mediacorp Canada Inc., the publishing company that creates the list.

Source: Adapted from Katherine Macklem, Showing the Love, Macleans, October 24, 2005, pp 2630.

UNDERSTANDING PEOPLE AT WORK

How important are people for organizational effectiveness in the 21st century? Stanford Universitys Jeffrey Pfeffer and his colleagues recently drew this conclusion:
There is a substantial and rapidly expanding body of evidence, some of it quite methodologically sophisticated, that speaks to the strong connection between how rms manage their people and the economic results achieved.1

Organizational behaviour
A eld of study dedicated to better understanding and managing people at work, both individually and in groups.

Thus there has been a growing awareness that the study of human behaviour in organizations is important. Specically, effective management of organizations requires the ability to understand, predict, and inuence behaviour. Organizational behaviour, commonly referred to as OB, is a eld of study dedicated to better understanding and managing people at work, both individually and in groups. OB involves the study of what people think and feel and the resulting effect on individual and group behaviour within organizations. OB researchers investigate unanswered questions relating to effective management of behaviour in organizations, and the results are intended to be used by managers and other employees to improve workplace effectiveness. Research evidence indicates that people-centred practices are strongly associated with much higher prots and signicantly lower employee turnover. In order for any team of managers and other employees to contribute to organizational goals and objectives, they must all work together and reinforce people-centred practices. The following seven people-centred practices have been identied in successful companies:
1. Job security (to eliminate fear of layoffs) 2. Careful hiring (emphasizing a good t with the company culture) 3. Power to the people (via decentralization and self-managed teams) 4. Generous pay for performance 5. Lots of training 6. Less emphasis on status (to build a we feeling) 7. Trust building (through the sharing of critical information)2

Importantly, these factors are a package deal, meaning they need to be installed in a coordinated and systematic mannernot in bits and pieces. Sadly, too many organizational leaders and managers tend to act counter to their declarations that people are their most important asset. For example, undue emphasis on short-term prot precludes long-term efforts to nurture human resources. Also, excessive layoffs, when managers view people as a cost rather than an asset, erode trust, commitment, and loyalty.3 Only 12 percent of todays organizations have the systematic approaches and persistence to qualify as true people-centred organizations, thus giving them a competitive advantage.4 The purpose of this rst chapter is to dene and examine organizational behaviour and its evolution, and look at important current issues affecting organizational behaviour today. It is important to study organizational behaviour because knowledge about OB provides the foundation for effective management of people in organizations. New knowledge can be applied directly, as in stress reduction techniques; can have a conceptual impact, as when a more positive attitude to hiring older workers results from learning their absenteeism rates are low; and can reinforce existing policies and procedures.5

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Managing People

It is also important to study organizational behaviour because todays successful managers need to creatively envision and actively sell bold new directions in an ethical and sensitive manner. Effective managers are team players empowered by the willing and active support of others who are driven by conicting self-interests. Managerial skills research yields three useful lessons:
1. Dealing effectively with people is

Queens Stripping Radlers Name from Business Wing

One day after David Radler, Conrad Blacks right-hand man, pleaded guilty to fraud charges in a US District Court, Queens University said it is stripping Mr. Radlers name from a wing of its business school and giving back a $1 million pledge he made to the university. It is believed to be the rst time a Canadian charity had returned a gift because the donor later committed a crime. Mr. Radler, who earned an MBA from Queens in 1967, made the gift in May 2000, on behalf of himself and several Hollinger newspapers, including the Kingston Whig-Standard. In September 2005, Mr. Radler pleaded guilty in a Chicago court to one count of mail fraud, as part of a scheme to divert more than $32 million from the Hollinger newspaper company into the pockets of senior executives of the company. In exchange for a 29-month jail term and a ne of US$250,000, he has agreed to cooperate with the continuing criminal probe into Lord Black and other former executives at Chicago-based Hollinger. Convictions of high-prole white-collar criminals have been mounting in the United States, as regulators try to reassure investors and clean up the image of corporate America that was tarnished by major frauds such as that which brought about Enrons collapse in 2001. Queens University stated in a press release: This decision was made after considerable reection upon the most appropriate course of action given the circumstances. Queens University very much regrets having to take this action.

Todays workplace is indeed undergoing immense and permanent changes.9 Organizations are being reengineered for greater speed, efciency, and exibility.10 Entrepreneurial spirit is needed in both small and large businesses. Teams are pushing aside the individual as the primary building block of organizations.11 Costs are being managed by use of contract workers. Command-andcontrol management is giving way to participative management and empowerment.12 Ego-centred leaders are being replaced by customer-centred leaders. Employees increasingly are being viewed as internal customers. E-business is growing rapidly. All this creates a mandate for a new kind of manager in the 21st century. Table 11 contrasts the characteristics of past and future managers. As the balance of this book will demonstrate, the managerial shift in Table 11 is not just a good idea, it is an absolute necessity in the new workplace.

ETHICS AT WORK

what management is all about. Thus, knowledge about OB is critical for management success. 2. Managers with high people skills mastery tend to have better business unit performance and employee morale than managers with low people skills mastery.6 3. Effective female and male managers do not have signicantly different skill proles,7 contrary to claims in the popular business press in recent years.8

You Decide
Was the decision of Queens University appropriate in the circumstances? Would it be ethical for Mr. Radler to testify against Mr. Black in the future?
Sources: David Radler Agrees to 29-Month Jail Term, CTV.ca, September 21, 2005 <www.ctv.ca/servlet/ArticleNews/story/CTVNews/20050921/ radler_hollinger_050920?s_name=&no_ads=>, accessed May 27, 2006; Paul Waldie, Queens Stripping Radlers Name from Business Wing, GlobeandMail.com, September 22, 2005 <www.theglobeandmail.com/ servlet/story/LAC.20050922.RADLER22/BNPrint/Idx>, accessed May 27, 2006; Queens Statement about Radler Gift, press release, Queens University site, September 21, 2005 <http://qnc.queensu.ca/story_loader. php?id=4331ade32a459>, accessed May 27, 2006.

Introduction to Organizational Behaviour

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TABLE 11

Evolution of the 21st-Century Manager

Past Managers Primary role Order giver, privileged elite, manipulator, controller Periodic learning, narrow specialist Time, effort, rank Monocultural, monolingual Formal authority Potential problem Vertical Limited input for individual decisions Afterthought Competitive (winlose) Hoard and restrict access Resist Future Managers Facilitator, team member, teacher, advocate, sponsor, coach Continuous lifelong learning, generalist with multiple ap specialties Skills, results Multicultural, multilingual Knowledge (technical and interpersonal) Primary resource Multidirectional Broad-based input for joint decisions Forethought Cooperative (winwin) Share and broaden access Facilitate

Learning and knowledge

Compensation criteria Cultural orientation Primary source of inuence View of people Primary communication pattern Decision-making style Ethical considerations Nature of interpersonal relationships Handling of power and key information Approach to change

THE EVOLUTION OF THE FIELD OF ORGANIZATIONAL BEHAVIOUR

OB is not an everyday job category such as accounting, marketing, or nance. Students of OB typically do not get jobs in organizational behaviour per se. This reality in no way lessens the importance of OB in effective organizational management. OB is a horizontal discipline that cuts across virtually every job category, business function, and professional specialty. Anyone who plans to make a living in a large or small, public or private, organization needs to study organizational behaviour. In order to understand behaviour in organizations, it is necessary to draw upon a diverse array of disciplines, including psychology, management, sociology, organization theory, social psychology, statistics, anthropology, general systems theory, economics, information technology, political science, vocational counselling, human stress management, psychometrics, ergonomics, decision theory, and ethics. This rich heritage has spawned many competing perspectives and theories about human work behaviour. Let us examine ve signicant landmarks in the evolution of understanding and managing people:
1. 2. 3. 4. 5.
6 PART ONE

The human relations movement The total quality management movement The information technology and e-business revolution Workforce diversity Globalization

Managing People

The Human Relations Movement

A unique combination of factors during the 1930s fostered the human relations movement. First, following legalization of unionmanagement collective bargaining in North America in the early 20th century, management began looking for new ways of handling employees. Until then, management was based on a scientic management approach that focused on the worker as a machine to be managed for maximum efciency. Second, behavioural scientists conducting on-the-job research started calling for more attention to the human factor. Managers who had lost the battle to keep unions out of their factories heeded the call for better human relations and improved working conditions. The human relations movement gathered momentum through the 1950s, as academics and managers alike made stirring claims about the powerful effect that individual needs, supportive supervision, and group dynamics apparently had on job performance.

The Writings of Mayo and Follett Essential to the human relations movement were the writings of Elton Mayo and Mary Parker Follett. Australian-born Mayo advised managers to attend to employees emotional needs in his 1933 classic The Human Problems of an Industrial Civilization. Follett was a true pioneer, not only as a woman management consultant in the male-dominated industrial world of the 1920s, but also as a writer who saw employees as complex combinations of attitudes, beliefs, and needs. Mary Parker Follett was way ahead of her time in telling managers to motivate job performance instead of merely demanding it, a pull rather than push strategy.13 McGregors Theory Y In 1960, Douglas McGregor wrote a book entitled The Human Side of Enterprise, which has become an important philosophical base for the modern view of people at work.14 Drawing upon his experience as a management consultant, McGregor formulated two sharply contrasting sets of assumptions about human nature (see Table 12). His Theory X assumptions were pessimistic and
McGregors Theory X and Theory Y
Outdated (Theory X) Assumptions about People at Work 1. Most people dislike work; they avoid it when they can. 2. Most people must be coerced and threatened with punishment before they will work. People require close direction when they are working. 3. Most people actually prefer to be directed. They tend to avoid responsibility and exhibit little ambition. They are interested only in security. Modern (Theory Y) Assumptions about People at Work 1. Work is a natural activity, like play or rest. 2. People are capable of self-direction and self-control if they are committed to objectives. 3. People generally become committed to organizational objectives if they are rewarded for doing so. 4. The typical employee can learn to accept and seek responsibility. 5. The typical member of the general population has imagination, ingenuity, and creativity.
Source: Adapted from D McGregor, The Human Side of Enterprise (New York: McGraw-Hill, 1960), Ch 4.

Theory X
Negative, pessimistic assumptions about human nature and its effect on productivity.

TABLE 12

Introduction to Organizational Behaviour

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Theory Y
Positive assumptions about employees being responsible and creative.

negative and, according to McGregors interpretation, typical of how managers traditionally perceived employees. To help managers break with this negative tradition, McGregor formulated his Theory Y, a modern and positive set of assumptions about people. McGregor believed managers could accomplish more through others by viewing them as self-energized, committed, responsible, and creative beings.

New Assumptions about Human Nature However, modern research methods have shown that the human relationists embraced some naive and misleading conclusions. Despite its shortcomings, the human relations movement opened the door to more progressive thinking about human nature. Rather than continuing to view employees as passive economic beings, managers began to see them as active social beings and took steps to create more humane work environments. This evolution toward the creation of more humane work environments continued with the emergence of the total quality management movement in the mid-20th century.

The Total Quality Management Movement

Total quality management
An organizational culture dedicated to training, continuous improvement, and customer satisfaction

Thanks to the concept of total quality management (TQM), the quality of much of what we buy today is signicantly better than in the past. The underlying principles of TQM are more important than ever given the growth of both e-business on the Internet and the overall service economy. A number of other quality initiatives, including Six Sigma (a reference to the statistical unlikelihood of a defective product), ISO, and QS, have also become widespread. TQM means that an organizations culture is focused on the constant attainment of customer satisfaction. This involves the continuous improvement of organizational processes, resulting in high-quality products and services.15 TQM is necessarily employeedriven, because product/service quality cannot be continuously improved without the active learning and participation of every employee. Thus, in successful quality improvement programs, quality principles are embedded in the organizations culture.

The Deming Legacy TQM is rmly established today thanks in large part to the pioneering work of W Edwards Deming.16 Ironically, he rarely talked in terms of quality. He instead preferred to discuss good management during the hard-hitting seminars he delivered right up until his death at age 93 in 1993.17 He had much to say about how employees should be treated. Regarding the human side of quality improvement, Deming called for the following:
Formal training in teamwork Helpful leadership, rather than order-giving and punishment Elimination of fear so employees will feel free to ask questions Emphasis on continuous process improvements rather than on numerical quotas Teamwork Elimination of barriers to good workmanship18

One of Demings most enduring lessons for managers is his 8515 rule.19 Specically, when things go wrong, there is roughly an 85% chance the system (including management, machinery, and rules) is at fault. Only about 15% of the time is the individual employee at fault. Unfortunately, as Deming observed, the typical manager spends most of his or her time wrongly blaming and punishing individuals for system failures. Statistical analysis is required to uncover system failures.

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Principles of Quality Management Despite variations in the language and scope of quality programs, it is possible to identify four common quality principles:
1. Do it right the rst time to eliminate costly rework. 2. Listen to and learn from customers and employees. 3. Make continuous improvement an everyday matter. 4. Build teamwork, trust, and mutual respect.20

Once again, as with the human relations movement, we see people as the key factor in organizational success. In summary, TQM advocates have made a valuable contribution to the eld of OB by providing a practical context for managing people. When people are managed according to quality principles, everyone is more likely to get the employment opportunities and high-quality goods and services they demand.21 These principles are particularly useful for management of technology workers in the growing e-business sector.

The Information Technology Revolution and E-Business

In just a few short years, an explosion of information technology has revolutionized business. Clearly, the Internet is here to stay as a business tool.22 The purpose of this section is to dene e-business and identify its signicant OB implications.

E-Business Is Much More than E-Commerce Experts on the subject draw an important distinction between e-commerce (buying and selling goods and services over the Internet) and e-business, using the Internet to facilitate every aspect of running a business.23 Intel, as a case in point, is striving to become an e-corporation, one that relies primarily on the Internet to not only buy and sell things, but also facilitate all business functions, exchange knowledge among its employees, and build partnerships with outsiders as well. E-business has signicant implications for managing people at work, because it eventually will seep into every corner of life both on and off the job. E-Business Implications for OB The following list is intended to suggest some of the implications of e-business relating to OB issues:
E-management. Twenty-rst-century managers, proled earlier in Table 11, are needed in the fast-paced Internet age. They are able to create, motivate, and lead virtual teams of far-ung specialists linked by email and project management software. Networking skills, applied both inside and outside the organization, are essential today. (See Chapters 3, 10, and 11.) E-communication. Email has become one of the most used and abused forms of organizational communication. Todays managers need to be masters of concise, powerful email and voice-mail messages. Additionally, employees who telecommute from home via the Internet present their managers with unique motivational and performance measurement problems. For their part, telecommuters must strike a productive balance between independence and feelings of isolation. (See Chapter 8.) Goal setting and feedback. Abundant research evidence supports the coupling of clear and challenging goals with timely and constructive feedback for keeping employees headed in the right direction. Thanks to Web-based software, managers can efciently create, align, and track their employees goals.24 (See Chapter 4.)

E-business
Running an entire business via the Internet.

Introduction to Organizational Behaviour

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 Organizational structure. The Internet and modern telecommunications technology have given rise to virtual teams and virtual organizations. Time zones, facilities, and location no longer are hard constraints on getting things accomplished. Got a great product idea but dont have the time to build a factory? No problem, just connect with someone via the Internet who can get the job done. This virtual workplace, with less face-to-face interaction, requires managers and employees who are exible and adaptable and not bound by slow and rigid bureaucratic communication and methods. (See Chapter 11.) Job design. The work itself is a powerful motivator for many employees today, especially those in information technology. Boring and unchallenging and/or deadend jobs will repel rather than attract top talent in the Internet age (see Chapter 3). Decision making. Things indeed are moving faster and faster in the Internet age. Just ask the typical overloaded manager who reports making more decisions in less time than he or she used to.25 Adding to the pressure, databases linked to the Internet give todays decision makers unprecedented amounts of both relevant and irrelevant data. Moreover, decision makers cannot ignore the trend away from command-and-control tactics and toward employee empowerment and participation. In short, there is more we than me for Internet-age decision makers. (See Chapter 6.) Speed, conict, and stress. Unfortunately, conict and stress are unavoidable byproducts of strategic and operational speed. Problems with balancing work and family responsibilities are widespread, particularly for female workers. The good news is that conict and stress can be managed. (See Chapters 5 and 9.) Change and resistance to change. As old economy companies race to become e-corporations, employees are being asked to digest huge doses of change in every aspect of their work lives. (See Chapter 13.) Ethics. Internet-centred organizations are littered with ethical landmines needing to be addressed humanely and responsibly. Among them are round-the-clock work binges, exaggerated promises about rewards, electronic monitoring, repetitivemotion injuries from excessive keyboarding, unfair treatment of part-timers, and privacy issues.26 (See Chapter 6.)

Telecommuters need to strike a productive balance between independence and feelings of isolation.

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Overall, it is easy to see why the information technology revolution represents a signicant new era for understanding and managing people at work. The problems, challenges, and opportunities are immense. At the same time, the Canadian workforce has become much more diverse.

Workforce Diversity
Workforce diversity management is one of the most important issues facing organizations today. Diversity represents the multitude of individual differences and similarities that exist among people.27 There are many different dimensions or components of diversity that make all of us unique and different from others. Figure 11 shows the diversity wheel and its four layers. Personality is at the centre of the diversity wheel because it represents a stable set of characteristics that is responsible for a persons individual identity. The dimensions of personality are discussed further in Chapter 2. The next layer of diversity consists of a set of internal dimensions such as age, race, and gender that are referred to as the primary dimensions of diversity.28 These dimensions, for the most part, are not within our control, but strongly inuence our attitudes, expectations, and assumptions about others, which in turn inuence our behaviour. The next layer of diversity is composed of external, or secondary, dimensions such as religion and marital status. They represent individual differences that we have a greater ability to inuence or control. These dimensions also exert a signicant inuence on our perceptions, behaviour, and attitudes. The nal layer of diversity includes organizational dimensions such as job title, union afliation, and seniority. The Royal Bank of Canada encourages this aspect of diversity by encouraging staff mobility within the bank. Every year, 25% of employees assume new work roles.29 One of the most well-known problems faced by women and visible minorities in the workplace is the glass ceiling. The glass ceiling represents an invisible barrier that blocks certain workers, primarily qualied women and visible minorities, from advancing into top management positions. It can be particularly de-motivating because employees can look up and see coveted top management positions through the transparent ceiling but are unable to obtain them. One study found that the barrier is much greater for minorities, and called it a concrete ceiling.30 In Canada, legislation covering federal workers and those in some provinces requires employers to actively pursue employment equity. Employment equity involves working to increase the number of workers from groups that have historically been underrepresented in an organizations workforce. In particular, the legislation requires that steps be taken to increase the representation of qualied women, visible minorities, Aboriginal people, and persons with disabilities at all levels of an organization. Diversity management involves activities aimed at managing individual differences in order to enable people to perform up to their maximum potential, including but not limited to those required for employment equity. It
Introduction to Organizational Behaviour

Diversity
The host of individual differences that make people different from and similar to each other.

Glass ceiling
Invisible barrier blocking qualied women and minorities from top management positions.

Employment equity
Legislation intended to remove employment barriers and promote equality for the members of four designated groups women, visible minorities, Aboriginal people, and persons with disabilities.

Diversity management
Policies, activities, and organizational changes aimed at managing individual differences in order to enable all people to perform up to their maximum potential.

One of the few Canadian women to break through the glass ceiling is Annette Verschuran, president of Home Depot Canada.

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11

FOCUS ON DIVERSITY
Legal Firms Concerned about Staff Diversity
Large legal rms are growing alarmed as they watch women and visible minority lawyers leave private practice after a few years, says Amy Gough Farnsworth, chair of the equality committee at the Canadian Bar Association. A lot of women are leaving large rms and going into in-house counsel in corporations or in the government. Private rms are losing a lot of people at a certain point in their career. The rms train people and they leave. The same goes for lawyers of racial minorities. And these are people who are successful in obtaining new positions. Gough Farnsworth says that it is a complex issue, and there may be subtle systemic factors. For example, les may be distributed in the mens washroom, and client development may happen on the golf course where there arent many women or persons from other countries. Every step along a lawyers career path should be assessed, she said. At articling interviews, for example, what do rms project as what they offer and what they expect? In terms of training and development, how do associates get feedback on their work? How are they helped along in terms of client development? Legal rms need to look for mechanisms that, though unintentionally, may be cutting people out of opportunities do develop within the structure of the rm, and hence impact retention because people feel doors are closed to them. The Canadian Bar Association is setting up an equity audit template to help rms identify the reasons theyre not able to hang on to lawyers from the four employment equity groups: women, visible minorities, Aboriginals, and people with disabilities.
Source: Adapted from Uyen Vu, Legal Firms Concerned about Staff Diversity, Canadian HR Reporter, May 17, 2004, p 2.

focuses on changing an organizations culture, policies, and procedures such that employees can perform at their highest level of productivity. To attract and retain the best workers, companies need to adopt policies and programs that meet the needs of a diverse group of workers. Programs such as daycare, eldercare, exible work schedules, less rigid relocation policies, and mentoring programs are likely to assist workers from all backgrounds to perform their job duties at an optimal level. A landmark study of the diversity practices used by 16 organizations that successfully managed diversity uncovered 52 different practices, 20 of which were used by the majority of the companies sampled. The 52 practices were classied into three main types: accountability; developmental; and recruitment.31 The top practices associated with each type are shown in Table 13. They are discussed below in relative order of importance.

Accountability Practices Accountability practices relate to managers responsibility to treat diverse employees fairly. Table 13 reveals that companies predominantly accomplish this objective by creating administrative procedures aimed at integrating diverse employees into the management ranks (practices numbered 3, 4, 5, 6, 8, 9, and 10). In contrast, work and family policies (practice 7) focus on creating an environment that fosters employee commitment and productivity. Moreover, organizations increasingly are attempting to build an accountability component into their diversity programs in order to motivate managers to effectively manage diversity.

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The Four Layers of Diversity

FIGURE 11

O rg

a n iz a t i o

Functional level/ classification

nal dimens ions

E x te

rnal dimensions*
Geographic location Work content/ field

Management status

Marital status

al dimension e rn s* Int
Age

Income

Parental status Union affiliation

Race

Gender

Personal habits

Personality Appearance Ethnicity Physical ability Sexual orientation

Division/ Recreational department/ unit/ habits group

Work experience

Religion

Work location

Educational background Seniority

*Internal Dimensions and External Dimensions are adapted from Loden and Rosener, Workforce America! (Homewood, IL: Business One Irwin, 1991). Source: L Gardenswartz and A Rowe, Diverse Teams at Work: Capitalizing on the Power of Diversity (New York: McGraw-Hill, 1994), p 33. 1994. Reproduced with permission of The McGraw-Hill Companies.

Developmental Practices The use of developmental practices to manage diversity is relatively new compared with the historical use of accountability and recruitment practices. Developmental practices focus on preparing diverse employees for greater responsibility and advancement. Theses activities are needed because most non-traditional employees have not been exposed to the types of activities and job assignments that develop effective leadership and social networks.32 Table 13 indicates that diversity training programs, networks and support groups, and mentoring programs are among the most frequently used developmental practices. Recruitment Practices Recruitment practices focus on attracting diverse job applicants at all levels who are willing to accept challenging work assignments. This focus is critical because people learn the leadership skills needed for advancement by successfully accomplishing increasingly responsible work assignments. As shown in Table 13, targeted recruitment of nonmanagers (practice 1), and managers (practice 9)

Introduction to Organizational Behaviour

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13

TABLE 13
Accountability Practices

Common Diversity Practices

Development Practices 1. Diversity training programs 2. Networks and support groups 3. Development programs for all high-potential managers 4. Informal networking activities 5. Job rotation 6. Formal mentoring program 7. Informal mentoring program 8. Entry development programs for all high-potential new hires 9. Internal training (such as personal safety or language) 10. Recognition events, awards Recruitment Practices 1. Targeted recruitment of nonmanagers 2. Key outside hires 3. Extensive public exposure on diversity 4. Corporate image as liberal, progressive, or benevolent 5. Partnerships with educational institutions 6. Recruitment incentives such as cash supplements 7. Internships 8. Publications or PR products that highlight diversity 9. Targeted recruitment of managers 10. Partnership with nontraditional groups

1. Top managements personal intervention 2. Internal advocacy groups 3. Emphasis on employment equity statistics, proles 4. Inclusion of diversity in performance evaluation goals, ratings 5. Inclusion of diversity in promotion decisions, criteria 6. Inclusion of diversity in management succession planning 7. Work and family policies 8. Policies against racism, sexism 9. Internal audit or attitude survey 10. Active employment equity committee, ofce

Source: Abstracted from Tables A.10, A.11, and A.12 in A M Morrison, The New Leaders: Guidelines on Leadership Diversity in America (San Francisco: Jossey-Bass, 1992). Reprinted with permission of John Wiley & Sons, Inc.

are commonly used to identify and recruit workers in groups that are commonly underrepresented in the workforce. In summary, effective workforce diversity management requires a number of OB skills, including managing change (Chapter 13), dealing with conict (Chapter 9), and political issues (Chapter 10), and most of all, exhibiting strong leadership skills (Chapter 11).

Globalization
Globalization
The extension of business operations to markets around the globe.

Globalization refers to the major trend whereby rms are extending their sales or manufacturing to new markets abroad. The world is fast moving toward becoming a single huge integrated marketplace. Globalization is increasing the intensity of competition in virtually all manufacturing and service industries. Major shifts in world economic power are anticipated as China overtakes the United States to become the most important economic player in the world.33 Expatriate managers struggle to nd effective methods of managing employees in countries as diverse as Kazakhstan, Bangladesh, and the Philippines. Cross-cultural training is essential, and specic knowledge regarding motivation, decision making, communication, and leadership practices in the country of operation are required to assist in maintaining smooth day-to-day operations. Globalization means that organizations manage people all over the worldpeople speaking different languages, governed by different political systems, under widely differing social, ethical, and behavioural norms. This situation has created a major challenge for managers from Western countries who are deployed in other parts of the world. Managerial approaches based on OB knowledge from North America will not necessarily apply in other cultures.
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INTERNATIONAL OB
Farewell, Canada: Expat Numbers to Grow
During the next ve years, Canadian multinational employers will require more ongoing management of foreign operations or sales, resulting in more expatriate employees moving, and in some instances relocating entire families, to foreign countries. This is according to a news survey co-sponsored by CIGNA International Expatriate Benets, Mercer Human Resource Consulting, WorldatWork, and International SOS Canada Inc. In the third Global Trends and Issues: International HR Executive Survey, and the rst to focus on Canadian multinationals, results show that employers will be looking to HR to be substantially involved in every aspect of an expatriates programs successfrom pre-departure to repatriation. An expatriate involves a huge direct investment by the company and plays a pivotal role in the ultimate success of a global operation, as well as representing the image of the company overseas, said Virginia Hollis, vice-president of global markets for CIGNA. With all this riding on an expat assignment, clearly, candidates should be selected carefully. Theres a wide range of practices in managing expatriates, said Tom Mitchell, a principal at Mercer Human Resource Consultings Toronto ofce. Some companies involve HR and others dont. Each company has its own approach and sometimes it differs from expatriate to expatriate. Companies are learning through trial and error, and this is a rude teacher. Good tools and a consistent approach are essential to managing the costs of the program and the experience of the expatriate.
Source: Adapted from Bonnie Serino, Farewell, Canada: Expat Numbers to Grow, WorldatWork Canadian News, Fourth Quarter 2003, pp 1215.

One general research nding of great importance in global management is that in OB, there is rarely one best way to manage people; the specic situation must also be considered. The contingency approach calls for using management concepts and techniques in a situationally appropriate manner, instead of trying to rely on one best way. Overall, todays managers need considerable knowledge of organizational behaviour in order to effectively manage the individuals and groups they are responsible for. Business realities such as quality management programs, e-business, workforce diversity, and globalization all have a major impact on the behaviour of employees, both individually and in groups, and even on the behavior of organizations themselves. No manager can be successful unless he or she can effectively manage other people. Your chances of becoming a successful manager can be enhanced by studying the material in this textbook.

Contingency approach
Using management tools and techniques in a situationally appropriate manner; avoiding the one best way mentality.

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Summary of Key Concepts

1. Dene organizational behaviour and explain why it is important for managers. Organizational behaviour (OB) is a eld of study dedicated to better understanding and managing people at work, both individually and in groups. OB is important for managers because of the increasing evidence that there is a strong connection between how organizations manage their people and the economic results achieved by the organization. 2. Identify the four principles of quality management. The four principles of quality management are (a) do it right the rst time to eliminate costly rework, (b) listen to and learn from customers and employees, (c) make continuous improvement an everyday matter, and (d) build teamwork, trust, and mutual respect. 3. Dene the term e-business, and specify ve ways the Internet is affecting the management of people at work. E-business involves using the Internet to more effectively and efciently manage every aspect of a business. The Internet is reshaping the management of people in the following areas: e-management (networking), e-communication (email and telecommuting), goal setting and feedback, organizational structure (virtual teams and organizations), job design (desire for more challenge), decision making (greater speed and employee empowerment), conict and stress triggered by increased speed, rapid change and inevitable conict and resistance, and ethical problems such as overwork and privacy issues. 4. Describe the four layers of diversity in an organizations workforce. Explain three general diversity management practices. The four layers of diversity are: (1) personality, which is unique to every individual, (2) internal dimensions such as age and race, (3) external dimensions such as religion and marital status, and (4) organizational dimensions such as job title. Three general diversity management practices are: (a) accountability practices to ensure that diverse employees are treated fairly, (b) development practices to prepare diverse employees for greater responsibility and advancement, and (c) recruitment practices to attract diverse job applicants at all levels. 5. Dene globalization and explain the OB research nding that is particularly signicant in this regard. Globalization is the extension of business operations to markets around the globe. The contingency approach to OB is particularly relevant here, as it suggests that it is better to use management tools and techniques in a situationally appropriate manner than to rely on one best way to manage.

Key Terms
contingency approach, 15 diversity, 11 diversity management, 11 e-business, 9 employment equity, 11 glass ceiling, 11 globalization, 14 organizational behaviour, 4 Theory X, 7 Theory Y, 8 total quality management, 8

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Discussion Questions
1. How would you respond to a fellow student who says, I have a hard time getting along with other people, but I think I could be a good manager? 2. Judging on the basis of either personal experience as a manager or your observation of managers at work, are the 11 skills in Table 11 a realistic portrayal of what managers do? 3. What is your personal experience with Theory X and Theory Y managers (see Table 12)? Which did you prefer? Why? 4. How would you respond to a new manager who made this statement? TQM is about statistical process control, not about people. 5. Consider a situation when you felt like a telecommuter while working on a group assignment for a class. How did you strike a balance between independence and feelings of isolation? 6. Using the diversity wheel, analyze a group of people you belong to (family, sports team, study group, etc.). What are the main sources of similarities and differences among members of the group on each layer of diversity? Do any of the areas of diversity create strength on the team? Weaknesses? Explain.

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Internet Exercises
Hewlett-Packard is a well-known company with a reputation as a good employer. Go to the OLC to investigate how Hewlett-Packard utilizes the seven people-centred practices discussed at the beginning of this chapter. Many organizations exist to promote employment equity. Go to the OLC to nd out more about two such organizations, (1) the Alliance for Employment Equity and (2) the Global Applied Disability Research and Information Network on Employment and Training.

Experiential Exercises
1. What Are the Strategies for Breaking the Glass Ceiling?
INSTRUCTIONS
Read the 13 career strategies shown below that may be used to break the glass ceiling. Next, rank-order each strategy in terms of its importance for contributing to the advancement of a woman to a senior management position. Rank the strategies from 1 (most important) to 13 (least important). Once this is completed, compute the gap between your rankings and those provided by the women executives who participated in this research. Their rankings are presented in endnote 34 at the back of the book. In computing the gaps, use the absolute value of the gap. (Absolute values are always positive, so just ignore the sign of your gap.) Finally, compute your total gap score. The larger the gap, the greater the difference in opinion between you and the women executives. What does your total gap score indicate about your recommended strategies?

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Strategy 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. Develop leadership outside ofce Gain line management experience Network with inuential colleagues Change companies Be able to relocate Seek difcult or high-visibility assignments Upgrade educational credentials Consistently exceed performance expectations Move from one functional area to another Initiate discussion regarding career aspirations Have an inuential mentor Develop style that men are comfortable with Gain international experience

My Rating

Survey Rating

Gap Your Survey Rating Rating

Source: Strategies and data were taken from B R Ragins, B Townsend, and M Mattis, Gender Gap in the Executive Suite: CEOs and Female Executives Report on Breaking the Glass Ceiling, The Academy of Management Executive, February 1998, pp 2842.

2. Who Comes First? Employees, Customers, or Stockholders?

INSTRUCTIONS
1. Drawing on your own value system and business philosophy, rank the three groups in the title of this exercise rst, second, and third in terms of managerial priority. What is the rationale for your ranking? 2. Read the two brief quotes after these questions. 3. In view of the opinions of these two respected business leaders, would you change your initial priority ranking? Why? With whom do you agree more, Iacocca or Kelleher? Why? Consult our Web site for an interpretation of this exercise: www.mcgrawhill.ca/college/kreitner. Lee Iacocca, former president of Ford and retired CEO of Chrysler:
Just be sure to take care of your customers. You have to go eyeball to eyeball with them and say, Do I have a deal for you! And then stand behind your product or service. Dont worry about stockholders or employees. If you take care of your customers, everything else will fall into place.*

Herb Kelleher, cofounder and chairperson of Southwest Airlines:

In the old days, my mother told me that in business school theyd say, This is a real conundrum: Who comes rst, your employees, your shareholders, or your customers? My mother taught me that your employees come rst. If you treat them well, then they treat the customers well, and that means your customers come back and your shareholders are happy.**

Sources: *As quoted in L McCauley and C Canabou, eds, Unit of One: The Voice of Experience, Fast Company, May 2001, p 82. **As quoted in J Huey, Outlaw Flyboy CEOs, Fortune, November 13, 2000, p 246.

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Personal Awareness and Growth Exercise

How Does Your Diversity Prole Affect Your Relationships with Other People?
OBJECTIVES
1. To identify the diversity prole of yourself and others 2. To consider the implications of similarities and differences across diversity proles

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QUESTIONS FOR DISCUSSION

1. To whom are you most similar and different? 2. Which diversity dimensions have the greatest inuence with respect to whom you are drawn to and whom you like the best? 3. Which dimensions of diversity seem relatively unimportant with respect to the quality of your interpersonal relationships? 4. Consider the individual with whom you have the most difcult time working or getting along. Which dimensions are similar and different? Which dimensions seem to be the source of your difculty? 5. If you choose co-workers for this exercise, discuss the management actions, policies, and/or programs that might be used to increase inclusiveness, reduce turnover, and increase job satisfaction.

INTRODUCTION
People vary along four layers of diversity: personality, internal dimensions, external dimensions, and organizational dimensions. Differences across these four layers are likely to inuence interpersonal relationships and the ability or willingness to work with others. You will be asked to compare yourself with a group of other people you interact with and then to examine the quality of the relationships between yourself and these individuals. This enables you to gain a better understanding of how similarities and differences among people inuence attitudes and behaviour.

INSTRUCTIONS
Complete the diversity prole by rst selecting ve current or past co-workers/work associates or fellow students. Alternatively, you can select ve people you interact with in order to accomplish your personal goals (e.g., team members on a class project). Write their names on the diagonal lines at the top of the worksheet. Next, determine whether each person is similar to or different from you with respect to each diversity dimension. Mark an S if the person is the same or a D if the person is different from yourself. Finally, answer the Questions for Discussion.

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DIVERSITY WORKSHEET
Work Associates
Diversity Dimensions Personality
E.g., Loyalty

Internal Dimensions
Age Gender Sexual orientation Physical ability Ethnicity Race

External Dimensions
Geographic location Income Personal habits Recreational habits Religion Educational background Work experience Appearance Parental status Marital status

Organizational Dimensions
Functional level/classification Work content/field Division/department/unit/group Seniority Work location Union affiliation Management status

Source: This exercise was modied from Garden Swartz and Rowe, Diverse Teams at Work (New York: McGraw-Hill, 1994), pp 6061. 1994. Reprinted with permission of The McGraw-Hill Companies.

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CBC Video Case

POLICE DIVERSITY
Jean-Luc Morins lifelong dream was to become a member of the RCMP. I had strong condence and high hopes of being able to serve and protect the Canadian population, says Morin. But his dream came true only briey. The RCMP has faced accusations of racism before, but it has not changed the way it handles complaints. Former constable Morin says he faced discrimination and harassment during his time at the RCMP, and that eventually he was forced to leave his job. Morin did his basic training in Regina. But when he began his eld training in Burnaby, British Columbia, things began to fall apart. He alleges that his supervisor criticized his English, yelled at him, and used racist terms. Specically, he says his white supervisor called him a curvy bucket ass, which refers to a black man with a big behind. After a year in his job, Morin was told to quit his job or otherwise he would be red. He left the job, came to Montreal, and led a complaint with the Human Rights Commission. He wants $300,000, an investigation into the matter, a public apology, and his job back for the harassment and discrimination he had to go through during his term.

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Corporal Calvin Lawrence is another visible-minority ofcer who has faced racism as an RCMP ofcer. He says that although he had 25 years of commendations on his le, it took a complaint to the Human Rights Commission before he got the promotion he deserved. The RCMP admits that hiring visible minorities has been a challenge. Only 5% of the RCMPs 15,000 ofcers are members of visible minorities. The RCMP also says that any harassment complaints brought to the attention of a supervisor will result in a thorough investigation.

QUESTIONS FOR DISCUSSION

1. Which of the four layers of diversity is involved in this case? 2. What employment equityrelated issues are raised in this case? 3. What could the RCMP do to improve diversity management and avoid legal actions such as this?

Source: Based on Police Diversity, CBC The National, June 16, 2004.

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