What is organizational behavior?

As a business leader, you are looking to improve your productivity and the working conditions of your employees. New collaborative tools, state-of-the-art offices, and the introduction of AI, you have invested considerable sums in the digital transformation of your company. Yet, something is not working as expected. Engagement is not there, turnover remains high, and productivity stagnates. It’s time for you to focus on the study of organizational behavior and its findings!*

The Hawthorne Effect

In the early 20^th century, industrial engineer and pioneer of scientific management, Frederic Taylor, introduced a new approach to work. Instead of asking employees to increase their efforts, he suggested that managers help them work more efficiently. He analyzed specific tasks by breaking them down into precise steps and identifying various factors to optimize each of these steps, such as the equipment used, the movements performed, the time required, and possible breaks. His scientific approach to analysis and experimentation at work was a true innovation.

Drawing inspiration from Taylor’s work, psychologist Elton Mayo and his colleagues from the Harvard Business School delved deeper into workplace experimentation. Between 1924 and 1933, they conducted a series of studies on employees at the Hawthorne plant of the Western Electric Company to explore the impact of working conditions on productivity. These studies, known as the Hawthorne studies, began by testing whether changing the factory’s lighting affected productivity. Surprisingly, the results showed an increase in productivity in both the group where the lighting was increased and the group with low lighting. Even more surprising, productivity dropped in both groups after the experiment ended. This apparent paradox highlights a fundamental truth: it was not the change in lighting that motivated the employees, but their perception of the attention they received from the researchers.

This observation made more than a century ago laid the foundation for the study of organizational behavior, which focuses on examining how individuals and groups act within organizations. Today, as AI and digitalization transform our ways of working, the concepts of organizational behavior are more relevant than ever. Indeed, the experiment conducted at the Hawthorne plant, now better known as the Hawthorne effect, reminds us of an essential truth: organizational performance does not solely depend on tools and material conditions, but rather on human dynamics.

Organizational performance does not solely depend on tools and material conditions, but rather on human dynamics.

Organizational behavior, the submerged part of the iceberg

Organizational behavior is a discipline that draws from psychology, sociology, and anthropology to understand and improve human interactions in the workplace. More than the aggregation of individual behaviors or the overall vision of the company’s life, organizational behavior seeks to understand the articulation of their relationships through five fundamental pillars:

• • Corporate culture: the DNA that effectively defines how things are done in your organization.
  • Motivation: the forces that drive your employees to engage and perform.
  • Leadership: the ability to guide and influence teams towards a common goal.
  • Communication: the information flows that keep your organization active and alive.
  • Group dynamics: the interactions that transform individuals into either high-performing or non-performing teams.

Considering these five pillars, organizational behavior aims to improve organizational performance by optimizing the behavior of individuals and groups. This includes creating a positive work environment, promoting innovation, and enhancing employee satisfaction and retention.

Nothing new so far, and as a business leader, you are certainly tempted to say that this is what you try to do daily. The question then is: with what results? Are you making the right efforts in the right place? If we take the example of corporate culture, did you know that your company operates like an iceberg?

This is what researcher Edgar Schein showed. On one side, there is the visible part, what you see and what you primarily deal with: equipment, systems, and processes. However, this part represents only 10% of your corporate culture. Then, there is the submerged part, which represents 90% of the iceberg, and can include beliefs, informal behaviors, but also group power dynamics.

Simply put, your new ergonomic offices and online collaborative tools will solve nothing if you do not take into account, for example, the underlying group power dynamics within your company’s teams. It is this submerged part of the iceberg that should be the focus of your attention if you want to understand why your employees’ current behavior remains irrational and resistant despite the real improvements you have made within your organization.

The benefits of organizational behavior

“Organizational behavior is the art of understanding and optimizing human interactions to transform individuals into high-performing teams.”

Organizational behavior is the art of understanding and optimizing human interactions to transform individuals into high-performing teams.

Organizational behavior is essential for structuring interactions and processes within a company. Without effective management of this behavior, employees can be driven towards irrationality despite your genuine efforts to improve their working conditions. Indeed, the absence of clear communication and well-defined organizational structures can lead to misunderstandings and conflicts. Employees may not understand the company’s expectations or objectives. When this happens, they make decisions based on incomplete or incorrect information, using confirmation bias (only considering information that reinforces their own beliefs) or favoring inertia, which stems from the status quo bias. Without effective leadership and shared organizational values, employees may also lack motivation and direction, which can lead to disorganized and inefficient behaviors.

By understanding and effectively managing the behaviors of individuals and groups, organizations can create a more productive and harmonious work environment and achieve tangible results:

• • Reduction of turnover. When employees feel supported and valued, they are less likely to leave the organization. This not only helps retain talent but also reduces the costs associated with recruiting and training new employees.
  • Improvement of communication and collaboration. Organizations that encourage open and transparent communication often see an increase in innovation and problem-solving. Employees are more inclined to share ideas and work together to achieve common goals.
  • Strengthening of leadership. Organizational behavior allows for the development of effective leaders who can inspire and guide their teams. Leaders who understand group dynamics and individual motivations are better equipped to positively influence their teams’ performance.

Taking organizational behavior into account is therefore essential to promote the smooth running of your business, especially as we find ourselves in a world where the rules of work are undergoing profound changes. A century after the Hawthorne effect, the work of Adam Grant is there to point it out. In “Think Again” (2021), he emphasizes that “Success in a rapidly changing world depends less on what we know than on our ability to rethink and relearn.” This observation is particularly relevant in the era of AI, which, following telecommuting, is poised to be the next revolution in the world of work. By identifying issues that were often overlooked during the implementation of telecommuting, it is possible to avoid repeating them now that you are considering introducing AI into your company. If this interests you, consult the content “Organizational Behavior, telecommuting, and AI” which illustrates how the changes brought by telecommuting and AI can be better addressed with the help of organizational behavior.

In any case, you must remember that organizational behavior will continue to evolve with the emergence of new technologies and work modes. As Grant (2023) points out, “Success will belong to organizations that know how to combine the best of humans and technology.” As a business leader, your role is to create the conditions in which this synergy can flourish. The question is no longer whether you should act, but how to start. You have the opportunity to take the first step towards a more resilient, more innovative, and more human organization today. The ball is in your court!

* Content translated from French by the BIL GPT AI tool