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Organizational success doesn’t happen by fluke. The most successful businesses are those that focus on their customers and look for ways to stay ahead of their competitors in a dynamic marketplace. But customer focus and high performance can only happen when the company’s employees are productive, efficient, motivated, engaged, and satisfied in the workplace.

To achieve these aims, companies must pay more attention to what motivates employees, what factors drive workplace engagement and satisfaction, and how inter-relationships between employees, teams, and management impact on-the-job effectiveness and performance. They must also revisit their organizational structure and policies behaviors to understand their impact on employee outcomes. And this is exactly where the study of organizational behavior comes in.

What is Organizational Behavior?

Organizational behavior refers to the behavioral dynamics that occur between individuals and groups in the organizational environment. By studying organizational behavior, leaders can understand how the company’s individuals, groups, technology social system, and structure interact with each other, and to what end. They can then take steps to improve employee productivity, effectiveness, and efficiency, which will ultimately impact the company’s ability to succeed and thrive in a competitive business landscape.

Here are 5 reasons organizational behavior – and its study – is the key to business success.

  1. Create a Comfortable Work Environment

Business leaders who assess the actions and attitudes of employees can better understand organizational behavior. They can then take the right action to create a comfortable work environment where employees feel empowered to do their work and meet their responsibilities.

Good organizational behavior can enhance employee performance, and increase job engagement and satisfaction. And if it encourages healthy competition, creates a safe space for discussion and feedback, and facilitates seamless collaboration and idea-sharing, it is more likely to succeed over its peers.

  1. Nurture a Culture Based on Trust, not Conflict

Organizational culture consists of the values, ethics, and motives that influence attitudes, working styles, and the way people interact with and collaborate with others. When employees feel respected, trusted, and heard, they become more responsible, feel more engaged at work, and perform better within their teams. They also feel more committed to their work, and more willing to align their personal or career goals with the company’s operational and strategic goals.

On the other hand, if the culture is based on conflict or fear of reprisal, employees will not bother to share new ideas or opinions. Conflicts might lead to full-scale confrontations – either with other employees or with management – that may negatively affect the organization in different ways. By observing, understanding, and measuring organizational behavior, leaders can prevent or resolve conflicts, understand the root cause of a problem, and minimize potential consequences before they can result in too much damage. Ultimately, they can build a positive culture where employees express themselves freely and come up with ideas to benefit the organization.

  1. More Effective Communication

By studying organizational behavior, leaders can leverage key insights to explain the business context to employees and get them more involved in day-to-day operations and decision-making. They can understand which model of management is likely to be most effective with employees – autocratic, supportive, mentoring, micro-management, carrots-and-sticks, etc. Over time, they can implement better communication channels and protocols, build more effective teams, and improve collaboration at multiple levels.

  1. More Motivated and Engaged Employees

Rewards are an important driver of employee motivation, and meaningful work that ties into the organization’s strategic goals can influence employee satisfaction and engagement. That’s why a solid, transparent, and data-driven reward system is essential, as is consistently rewarding employees who perform well.

When employees can clearly see the relationship between effort and reward, their behaviors and attitudes will automatically change, impact their performance, and ultimately drive the organization’s success. 

  1. Create a Performance- and Success-oriented Hierarchical Structure

The corporate structure can massively influence an organization’s behavior, and ultimately, its success. An increasing number of companies are moving away from hierarchical, “top-down” structures towards a flatter, more linear structure in order to give their workforce more freedom over how they do their job, communicate with peers, and collaborate with stakeholders.

A flat structure enables them to have a greater voice and make bigger contributions to their team, business unit, and the organization as a whole. Further, by eliminating unnecessary bureaucratic levels and red tape, leadership can build a stronger relationship with employees who are rooted in trust, common goals, and transparency.

Conclusion

Organizational behavior is a complex, many-headed beast that’s influenced by multiple factors, including the company’s culture, environment, policies, social system, and hierarchical structure. All these elements can influence employees’ on-the-job productivity and performance, and ultimately, their commitment to the organization and its goals. By understanding the dynamic inter-connections between these factors – also known as organizational behavior – organizational leaders can influence their employees’ behaviors and set up their organization for success. 

Key Takeaways:

  • Good organizational behavior can enhance employee performance, and increase job engagement and satisfaction.
  • By observing, understanding, and measuring organizational behavior, leaders can prevent or resolve conflicts, understand the root cause of a problem, and minimize potential consequences before they can result in too much damage.
  • By studying organizational behavior, leaders can leverage key insights to explain the business context to employees and get them more involved in day-to-day operations and decision-making.
  • The corporate structure from hierarchical, “top-down” to a flatter, more linear structure can massively influence an organization’s behavior, and ultimately, its success.
  • A solid, transparent, and data-driven reward system impact employee behaviors and performances driving the organization’s success.
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