Discussion Forum on Chapter readings

Type your initial post in this Discussion Forum based on the assigned readings for the week. The initial post should contain a minimum of 500 words. The initial post should contain your summary of the assigned readings for this unit of study.

REQUIRED TEXT

Robbins, S. & Judge T. (2018). Essentials of Organizational Behavior. Boston, MA: Pearson.

Chapter 13 Power and Politics

Chapter 14 Conflict and Negotiation

Organizational
Behavior

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Organizational
Behavior
15
Stephen P. Robbins
—San Diego State University
Timothy A. Judge
—University of Notre Dame

E D I T I O N
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Library of Congress Cataloging-in-Publication Data
Robbins, Stephen P.
Organizational behavior / Stephen P. Robbins, Timothy A. Judge. — 15th ed.
p. cm.
Includes indexes.
ISBN-13: 978-0-13-283487-2
ISBN-10: 0-13-283487-1
1. Organizational behavior. I. Judge, Tim. II. Title.
HD58.7.R62 2012
658.3—dc23
2011038674
10 9 8 7 6 5 4 3 2 1
ISBN 10: 0-13-283487-1
ISBN 13: 978-0-13-283487-2

3
2
1
Brief Contents
The Individual
2 Diversity in Organizations 39
3 Attitudes and Job Satisfaction 69
4 Emotions and Moods 97
5 Personality and Values 131
6 Perception and Individual Decision Making 165
7 Motivation Concepts 201
8 Motivation: From Concepts to Applications 239
The Group
9 Foundations of Group Behavior 271
10 Understanding Work Teams 307
11 Communication 335
12 Leadership 367
13 Power and Politics 411
14 Conflict and Negotiation 445
15 Foundations of Organization Structure 479
Preface xxii
v
Introduction
1 What Is Organizational Behavior? 3

vi B R I E F C O N T E N T S
Appendix A Research in Organizational Behavior 616
Comprehensive Cases 623
Indexes 637
Glindex 663
4 The Organization System
16 Organizational Culture 511
17 Human Resource Policies and Practices 543
18 Organizational Change and Stress Management 577

1
Contents
Preface xxii
vii
Introduction
1 What Is Organizational Behavior? 3
The Importance of Interpersonal Skills 4
What Managers Do 5
Management Functions 6 • Management Roles 6 • Management
Skills 8 • Effective versus Successful Managerial Activities 8 • A Review
of the Manager’s Job 9
Enter Organizational Behavior 10
Complementing Intuition with Systematic Study 11
Disciplines That Contribute to the OB Field 13
Psychology 14 • Social Psychology 14 • Sociology 14 • Anthropology 14
There Are Few Absolutes in OB 14
Challenges and Opportunities for OB 15
Responding to Economic Pressures 15 • Responding to Globalization 16
• Managing Workforce Diversity 18 • Improving Customer
Service 18 • Improving People Skills 19 • Stimulating Innovation
and Change 20 • Coping with “Temporariness” 20 • Working in
Networked Organizations 20 • Helping Employees Balance Work–Life
Conflicts 21 • Creating a Positive Work Environment 22 • Improving
Ethical Behavior 22
Coming Attractions: Developing an OB Model 23
An Overview 23 • Inputs 24 • Processes 25 • Outcomes 25
Summary and Implications for Managers 30
Self-Assessment Library How Much Do I Know About Organizational Behavior? 4
Myth or Science? “Most Acts of Workplace Bullying Are Men Attacking Women” 12
An Ethical Choice Can You Learn from Failure? 24
glOBalization! Does National Culture Affect Organizational Practices? 30
Point/Counterpoint Lost in Translation? 31
Questions for Review 32
Experiential Exercise Workforce Diversity 32
Ethical Dilemma Jekyll and Hyde 33
Case Incident 1 “Lessons for ‘Undercover’ Bosses” 34
Case Incident 2 Era of the Disposable Worker? 35
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viii C O N T E N T S
S A L
S A L
2 The Individual
2 Diversity in Organizations 39
Diversity 40
Demographic Characteristics of the U.S. Workforce 41 • Levels
of Diversity 42 • Discrimination 42
Biographical Characteristics 44
Age 44 • Sex 46 • Race and Ethnicity 48 • Disability 48 • Other
Biographical Characteristics: Tenure, Religion, Sexual Orientation,
and Gender Identity 50
Ability 52
Intellectual Abilities 52 • Physical Abilities 55 • The Role of Disabilities 56
Implementing Diversity Management Strategies 56
Attracting, Selecting, Developing, and Retaining Diverse
Employees 56 • Diversity in Groups 58 • Effective Diversity Programs 58
Summary and Implications for Managers 60
Self-Assessment Library What’s My Attitude Toward Older People? 40
Myth or Science? “Dual-Career Couples Divorce Less” 47
An Ethical Choice Religious Tattoos 51
glOBalization! Images of Diversity from Around the Globe 54
Point/Counterpoint Men Have More Mathematical Ability Than Women 61
Questions for Review 62
Experiential Exercise Feeling Excluded 62
Ethical Dilemma Board Quotas 62
Case Incident 1 The Flynn Effect 63
Case Incident 2 Increasing Age Diversity in the Workplace 64
3 Attitudes and Job Satisfaction 69
Attitudes 70
What Are the Main Components of Attitudes? 70 • Does Behavior Always
Follow from Attitudes? 71 • What Are the Major Job Attitudes? 73
Job Satisfaction 78
Measuring Job Satisfaction 79 • How Satisfied Are People in Their
Jobs? 80 • What Causes Job Satisfaction? 81 • The Impact of Satisfied
and Dissatisfied Employees on the Workplace 82
Summary and Implications for Managers 88
Self-Assessment Library How Satisfied Am I with My Job? 70

An Ethical Choice Do Employers Owe Workers More Satisfying Jobs? 74
glOBalization! Culture and Work–Life Balance 76
Self-Assessment Library Am I Engaged? 78
Myth or Science? “Favorable Job Attitudes Make Organizations More Profitable” 83
Point/Counterpoint Employer–Employee Loyalty Is an Outdated Concept 87
Questions for Review 88
Experiential Exercise What Factors Are Most Important to Your Job Satisfaction? 89
Ethical Dilemma Bounty Hunters 89
Case Incident 1 Long Hours, Hundreds of E-Mails, and No Sleep:
Does This Sound Like a Satisfying Job? 90
Case Incident 2 Crafting a Better Job 91
4 Emotions and Moods 97
What Are Emotions and Moods? 98
The Basic Emotions 100 • The Basic Moods: Positive and Negative Affect 100
• The Function of Emotions 102 • Sources of Emotions and Moods 103
Emotional Labor 108
Affective Events Theory 110
Emotional Intelligence 112
The Case for EI 113 • The Case Against EI 114 • Emotion Regulation 115
OB Applications of Emotions and Moods 115
Selection 116 • Decision Making 116 • Creativity 116 • Motivation 117
• Leadership 117 • Negotiation 117 • Customer Service 118 • Job
Attitudes 119 • Deviant Workplace Behaviors 119 • Safety and Injury
at Work 119 • How Managers Can Influence Moods 120
Summary and Implications for Managers 121
Self-Assessment Library How Are You Feeling Right Now? 98
Self-Assessment Library What’s My Affect Intensity? 104
Myth or Science? We Are Better Judges of When Others Are Happy Than When
They Are Sad 107
glOBalization! Should You Expect “Service with a Smile” All Around the World? 108
Self-Assessment Library What’s My Emotional Intelligence Score? 115
An Ethical Choice Schadenfreude 120
Point/Counterpoint Sometimes Blowing Your Top Is a Good Thing 122
Questions for Review 121
Experiential Exercise Who Can Catch a Liar? 123
Ethical Dilemma Happiness Coaches for Employees 123
Case Incident 1 Is It Okay to Cry at Work? 124
Case Incident 2 Can You Read Emotions from Faces? 124
5 Personality and Values 131
Personality 133
What Is Personality? 133 • The Myers-Briggs Type Indicator 135 • The Big
Five Personality Model 136 • Other Personality Traits Relevant to OB 139
C O N T E N T S ix
S A L
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x C O N T E N T S
Values 144
The Importance of Values 144 • Terminal versus Instrumental
Values 144 • Generational Values 145
Linking an Individual’s Personality and Values to the Workplace 148
Person–Job Fit 148 • Person–Organization Fit 150
International Values 150
Summary and Implications for Managers 154
Self-Assessment Library Am I a Narcissist? 132
Myth or Science? Personality Predicts the Performance of Entrepreneurs 142
glOBalization! The Right Personality for a Global Workplace 143
An Ethical Choice Should You Try to Change Someone’s Personality? 147
Point/Counterpoint Millennials Are More Narcissistic 155
Questions for Review 156
Experiential Exercise What Organizational Culture Do You Prefer? 156
Ethical Dilemma Freedom or Lack of Commitment? 156
Case Incident 1 Is There a Price for Being Too Nice? 157
Case Incident 2 Leadership from an Introvert’s Perspective 158
6 Perception and Individual Decision Making 165
What Is Perception? 166
Factors That Influence Perception 167
Person Perception: Making Judgments About Others 168
Attribution Theory 168 • Common Shortcuts in Judging
Others 170 • Specific Applications of Shortcuts in Organizations 173
The Link Between Perception and Individual Decision Making 174
Decision Making in Organizations 175
The Rational Model, Bounded Rationality, and Intuition 175 • Common
Biases and Errors in Decision Making 177
Influences on Decision Making: Individual Differences and Organizational
Constraints 184
Individual Differences 184 • Organizational Constraints 186
What About Ethics in Decision Making? 187
Three Ethical Decision Criteria 187 • Improving Creativity in Decision
Making 188
Summary and Implications for Managers 190
Self-Assessment Library What Are My Gender Role Perceptions? 166
glOBalization! Chinese Time, North American Time 171
Myth or Science? Creative Decision Making Is a Right-Brain Activity 181
Self-Assessment Library Am I A Deliberate Decision Maker? 183
An Ethical Choice Whose Ethical Standards to Follow? 185
Self-Assessment Library How Creative Am I? 190
Point/Counterpoint Checklists Lead to Better Decisions 191
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C O N T E N T S xi
Questions for Review 192
Experiential Exercise Biases in Decision Making 193
Ethical Dilemma Do Unethical Decisions Come from Bad Character? 193
Case Incident 1 Computerized Decision Making 194
Case Incident 2 Predictions That Didn’t Quite Pan Out 195
7 Motivation Concepts 201
Defining Motivation 202
Early Theories of Motivation 203
Hierarchy of Needs Theory 203 • Theory X and Theory Y 205 • Two-Factor
Theory 205 • McClelland’s Theory of Needs 207
Contemporary Theories of Motivation 208
Self-Determination Theory 208 • Job Engagement 211 • Goal-Setting
Theory 212 • Self-Efficacy Theory 215 • Reinforcement Theory 218 • Equity
Theory/Organizational Justice 219 • Expectancy Theory 224
Integrating Contemporary Theories of Motivation 226
Summary and Implications for Managers 228
Self-Assessment Library How Confident Am I in My Abilities to Succeed? 202
Myth or Science? “The Support of Others Improves Our Chances of Accomplishing
Our Goals” 204
An Ethical Choice Motivated to Behave Unethically 209
glOBalization! Autonomy Needs Around the Globe 210
Self-Assessment Library What Are My Course Performance Goals? 214
Point/Counterpoint Fear Is a Powerful Motivator 229
Questions for Review 230
Experiential Exercise Goal-Setting Task 230
Ethical Dilemma The Big Easy? 230
Case Incident 1 It’s Not Fair! 231
Case Incident 2 Bullying Bosses 231
8 Motivation: From Concepts to Applications 239
Motivating by Job Design: The Job Characteristics Model 240
The Job Characteristics Model 240 • How Can Jobs Be
Redesigned? 242 • Alternative Work Arrangements 245 • The Social and
Physical Context of Work 249
Employee Involvement 250
Examples of Employee Involvement Programs 251 • Linking Employee
Involvement Programs and Motivation Theories 252
Using Rewards to Motivate Employees 252
What to Pay: Establishing a Pay Structure 252 • How to Pay: Rewarding
Individual Employees Through Variable-Pay Programs 253 • Flexible
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xii C O N T E N T S
Benefits: Developing a Benefits Package 257 • Intrinsic Rewards: Employee
Recognition Programs 259
Summary and Implications for Managers 261
Self-Assessment Library What’s My Job’s Motivating Potential? 240
Myth or Science? “CEO Pay Can’t Be Measured” 243
An Ethical Choice Identifying Conflicts of Interest 258
glOBalization! Motivated by Individual Goals or Relational Goals? 260
Point/Counterpoint “If Money Doesn’t Make You Happy, You Aren’t Spending It Right” 262
Questions for Review 263
Experiential Exercise Assessing Employee Motivation and Satisfaction Using
the Job Characteristics Model 263
Ethical Dilemma Spitting Mad 264
Case Incident 1 Multitasking: A Good Use of Your Time? 264
Case Incident 2 Bonuses Can Backfire 265
3 The Group
9 Foundations of Group Behavior 271
Defining and Classifying Groups 272
Why Do People Form Groups? 272
Stages of Group Development 274
The Five-Stage Model 275 • An Alternative Model for Temporary Groups
with Deadlines 276
Group Properties: Roles, Norms, Status, Size, Cohesiveness, and Diversity 277
Group Property 1: Roles 277 • Group Property 2: Norms 280 • Group
Property 3: Status 285 • Group Property 4: Size 286 • Group Property 5:
Cohesiveness 288 • Group Property 6: Diversity 288
Group Decision Making 290
Groups versus the Individual 290 • Groupthink and
Groupshift 292 • Group Decision-Making Techniques 295
Summary and Implications for Managers 296
Self-Assessment Library Do I Have a Negative Attitude Toward Working in Groups? 272
Self-Assessment Library Do I Trust Others? 280
glOBalization! Forming International Teams in a Virtual World 291
Myth or Science? “Asians Have Less Ingroup Bias Than Americans” 292
An Ethical Choice Should You Use Group Peer Pressure? 294
Point/Counterpoint Affinity Groups Fuel Business Success 298
Questions for Review 297
Experiential Exercise Wilderness Survival 299
Ethical Dilemma Is Social Loafing Shirking? 300
Case Incident 1 Negative Aspects of Collaboration? 300
Case Incident 2 Herd Behavior and the Housing Bubble (and Collapse) 301
S A L
S A L

C O N T E N T S xiii
10 Understanding Work Teams 307
Why Have Teams Become So Popular? 308
Differences Between Groups and Teams 309
Types of Teams 310
Problem-Solving Teams 310 • Self-Managed Work Teams 310
• Cross-Functional Teams 311 • Virtual Teams 312
Creating Effective Teams 312
Context: What Factors Determine Whether Teams Are Successful 313
• Team Composition 315 • Team Processes 319
Turning Individuals into Team Players 322
Selecting: Hiring Team Players 323 • Training: Creating Team
Players 324 • Rewarding: Providing Incentives to Be a Good Team
Player 324
Beware! Teams Aren’t Always the Answer 324
Summary and Implications for Managers 325
Self-Assessment Library How Good Am I at Building and Leading a Team? 308
glOBalization! Group Cohesiveness across Cultures 314
An Ethical Choice Using Global Virtual Teams as an Environmental Choice 315
Myth or Science? “Teams Work Best Under Angry Leaders” 320
Self-Assessment Library What Is My Team Efficacy? 322
Point/Counterpoint We Can Learn Much About Work Teams from Studying
Sports Teams 326
Questions for Review 327
Experiential Exercise Fixed versus Variable Flight Crews 327
Ethical Dilemma Unethical Teams 327
Case Incident 1 Why Don’t Teams Work Like They’re Supposed to? 328
Case Incident 2 Multicultural Multinational Teams at IBM 329
11 Communication 335
Functions of Communication 336
The Communication Process 338
Direction of Communication 338
Downward Communication 339 • Upward Communication 339
• Lateral Communication 339
Interpersonal Communication 340
Oral Communication 340 • Written Communication 341
• Nonverbal Communication 341
Organizational Communication 342
Formal Small-Group Networks 343 • The Grapevine 343
• Electronic Communications 345 • Managing Information 349
Choice of Communication Channel 350
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xiv C O N T E N T S
Persuasive Communications 351
Automatic and Controlled Processing 351 • Interest Level 352
• Prior Knowledge 352 • Personality 352 • Message Characteristics 352
Barriers to Effective Communication 353
Filtering 353 • Selective Perception 353 • Information
Overload 353 • Emotions 353 • Language 354 • Silence 354
• Communication Apprehension 355 • Lying 355
Global Implications 356
Cultural Barriers 356 • Cultural Context 357 • A Cultural Guide 358
Summary and Implications for Managers 360
Self-Assessment Library Am I a Gossip? 336
An Ethical Choice The Ethics of Gossip at Work 345
Myth or Science? “We Know What Makes Good Liars Good” 356
glOBalization! How Direct Should You Be? 358
Point/Counterpoint Social Networking Is Good Business 359
Self-Assessment Library How Good Are My Listening Skills? 360
Questions for Review 360
Experiential Exercise An Absence of Nonverbal Communication 361
Ethical Dilemma Pitfalls of E-Mail 361
Case Incident 1 Using Social Media to Your Advantage 362
Case Incident 2 Should Companies That Fire Shoot First? 362
12 Leadership 367
What Is Leadership? 368
Trait Theories 369
Behavioral Theories 370
Summary of Trait Theories and Behavioral Theories 372
Contingency Theories 372
The Fiedler Model 373 • Other Contingency Theories 375
Leader–Member Exchange (LMX) Theory 377
Charismatic Leadership and Transformational Leadership 379
Charismatic Leadership 379 • Transformational Leadership 382
Authentic Leadership: Ethics and Trust 386
What Is Authentic Leadership? 386 • Ethics and Leadership 386 • Servant
Leadership 387 • Trust and Leadership 387 • How Is Trust Developed? 389
• Trust as a Process 390 • What Are the Consequences of Trust? 390
Leading for the Future: Mentoring 391
Mentoring 391
Challenges to the Leadership Construct 393
Leadership as an Attribution 393 • Substitutes for and Neutralizers
of Leadership 394 • Online Leadership 395
Finding and Creating Effective Leaders 396
Selecting Leaders 396 • Training Leaders 396
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C O N T E N T S xv
Summary and Implications for Managers 397
Self-Assessment Library What’s My Leadership Style? 368
Self-Assessment Library What’s My LPC Score? 373
glOBalization! Cross-Cultural Leadership Styles 378
Self-Assessment Library How Charismatic Am I? 382
Self-Assessment Library Am I an Ethical Leader? 386
An Ethical Choice Do Leaders Have a Responsibility to Protect
Followers? 388
Myth or Science? “Power Helps Leaders Perform Better” 392
Point/Counterpoint Heroes Are Made, Not Born 398
Questions for Review 399
Experiential Exercise What Is a Leader? 399
Ethical Dilemma Undercover Leaders 399
Case Incident 1 Leadership Mettle Forged in Battle 400
Case Incident 2 Leadership Factories 400
13 Power and Politics 411
A Definition of Power 412
Contrasting Leadership and Power 413
Bases of Power 414
Formal Power 414 • Personal Power 415 • Which Bases of Power Are
Most Effective? 416 • Power and Perceived Justice 416
Dependence: The Key to Power 416
The General Dependence Postulate 416 • What Creates Dependence? 417
Power Tactics 418
Sexual Harassment: Unequal Power in the Workplace 421
Politics: Power in Action 424
Definition of Organizational Politics 424 • The Reality of Politics 424
Causes and Consequences of Political Behavior 426
Factors Contributing to Political Behavior 426 • How Do People Respond
to Organizational Politics? 429 • Impression Management 430
The Ethics of Behaving Politically 434
Summary and Implications for Managers 435
Self-Assessment Library Is My Workplace Political? 412
glOBalization! Power Distance and Innovation 420
An Ethical Choice Should All Sexual Behavior Be Prohibited at Work? 423
Myth or Science? “Corporate Political Activity Pays” 428
Self-Assessment Library How Good Am I at Playing Politics? 430
Point/Counterpoint Power Corrupts People 436
Questions for Review 437
Experiential Exercise Understanding Power Dynamics 437
Ethical Dilemma Corporate Spying 438
Case Incident 1 Delegate Power, or Keep It Close? 438
Case Incident 2 The Persuasion Imperative 439
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xvi C O N T E N T S
14 Conflict and Negotiation 445
A Definition of Conflict 446
Transitions in Conflict Thought 447
The Traditional View of Conflict 447 • The Interactionist View
of Conflict 447 • Resolution-Focused View of Conflict 449
The Conflict Process 449
Stage I: Potential Opposition or Incompatibility 450 • Stage II: Cognition
and Personalization 451 • Stage III: Intentions 452 • Stage IV:
Behavior 454 • Stage V: Outcomes 455
Negotiation 458
Bargaining Strategies 458 • The Negotiation Process 463
• Individual Differences in Negotiation Effectiveness 464 • Third-Party
Negotiations 467
Summary and Implications for Managers 469
Self-Assessment Library What’s My Preferred Conflict-Handling Style? 446
Myth or Science? “Communicating Well Is More Important in Cross-Cultural
Negotiations” 462
glOBalization! Anger and Conflict Across Cultures 467
Self-Assessment Library What’s My Negotiating Style? 467
An Ethical Choice Using Empathy to Negotiate More Ethically 468
Point/Counterpoint Player–Owner Disputes Are Unnecessary 471
Questions for Review 472
Experiential Exercise A Negotiation Role-Play 472
Ethical Dilemma The Lowball Applicant 473
Case Incident 1 Choosing Your Battles 473
Case Incident 2 Mediation: Master Solution to Employment Disputes? 474
15 Foundations of Organization Structure 479
What Is Organizational Structure? 480
Work Specialization 480 • Departmentalization 482 • Chain
of Command 483 • Span of Control 484 • Centralization and
Decentralization 485 • Formalization 486
Common Organizational Designs 486
The Simple Structure 486 • The Bureaucracy 487 • The Matrix Structure 488
New Design Options 490
The Virtual Organization 490 • The Boundaryless Organization 492
• The Leaner Organization: Downsizing 494
Why Do Structures Differ? 496
Organizational Strategy 496 • Organization Size 498 • Technology 498
• Environment 499
Organizational Designs and Employee Behavior 501
Summary and Implications for Managers 502
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C O N T E N T S xvii
4 The Organization System
16 Organizational Culture 511
What Is Organizational Culture? 512
A Definition of Organizational Culture 512 • Culture Is a Descriptive
Term 514 • Do Organizations Have Uniform Cultures? 514 • Strong versus
Weak Cultures 514 • Culture versus Formalization 515
What Do Cultures Do? 516
Culture’s Functions 516 • Culture Creates Climate 516 • Culture as a
Liability 517
Creating and Sustaining Culture 519
How a Culture Begins 519 • Keeping a Culture Alive 519 • Summary:
How Cultures Form 523
How Employees Learn Culture 523
Stories 523 • Rituals 524 • Material Symbols 524 • Language 524
Creating an Ethical Organizational Culture 525
Creating a Positive Organizational Culture 527
Spirituality and Organizational Culture 529
What Is Spirituality? 529 • Why Spirituality Now? 530 • Characteristics
of a Spiritual Organization 530 • Achieving a Spiritual
Organization 531 • Criticisms of Spirituality 531
Global Implications 532
Summary and Implications for Managers 533
Self-Assessment Library What’s the Right Organizational Culture for Me? 512
glOBalization! Face Culture, Dignity Culture, and Organizational Culture 515
Myth or Science? “Employees Treat Customers the Same Way the Organization
Treats Them” 518
An Ethical Choice Designing a Culture of Ethical Voice 526
S A L
Self-Assessment Library Do I Like Bureaucracy? 480
Self-Assessment Library How Willing Am I to Delegate? 486
glOBalization! The Global Organization 489
An Ethical Choice Downsizing with a Conscience 496
Myth or Science? “Employees Resent Outsourcing” 500
Point/Counterpoint The End of Management 503
Questions for Review 504
Experiential Exercise Dismantling a Bureaucracy 504
Ethical Dilemma Directing the Directors 505
Case Incident 1 Creative Deviance: Bucking the Hierarchy? 506
Case Incident 2 Siemens’ Simple Structure—Not 506
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xviii C O N T E N T S
Self-Assessment Library How Spiritual Am I? 531
Point/Counterpoint Organizations Should Strive to Create a Positive
Organizational Culture 534
Questions for Review 535
Experiential Exercise Rate Your Classroom Culture 535
Ethical Dilemma A Bankrupt Culture 536
Case Incident 1 Mergers Don’t Always Lead to Culture Clashes 536
Case Incident 2 Did Toyota’s Culture Cause Its Problems? 537
17 Human Resource Policies and Practices 543
Selection Practices 544
How the Selection Process Works 544 • Initial Selection 545 • Substantive
Selection 546 • Contingent Selection 549 • International Variations
in Selection Processes 550
Training and Development Programs 551
Types of Training 551 • Training Methods 553 • Evaluating
Effectiveness 554
Performance Evaluation 554
What Is Performance? 555 • Purposes of Performance
Evaluation 555 • What Do We Evaluate? 555 • Who Should Do the
Evaluating? 556 • Methods of Performance Evaluation 558 • Suggestions
for Improving Performance Evaluations 560 • Providing Performance
Feedback 562 • International Variations in Performance Appraisal 563
Managing Work–Life Conflicts in Organizations 563
Summary and Implications for Managers 566
Self-Assessment Library How Much Do I Know About Human Resource
Management (HRM)? 544
glOBalization! Performance Appraisal Around the World 558
An Ethical Choice Recruiting the Unemployed 561
Self-Assessment Library How Good Am I at Giving Performance Feedback? 563
Myth or Science? “Work Is Making Us Fat” 564
Point/Counterpoint Social Media Is a Great Source of New Hires 567
Questions for Review 568
Experiential Exercise Evaluating Performance and Providing Feedback 568
Ethical Dilemma Credit Checking 568
Case Incident 1 The End of the Performance Appraisal? 569
Case Incident 2 Job Candidates Without Strong SAT Scores Need Not Apply 570
18 Organizational Change and Stress Management 577
Forces for Change 578
Planned Change 580
Resistance to Change 580
Overcoming Resistance to Change 582 • The Politics of Change 584
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C O N T E N T S xix
Approaches to Managing Organizational Change 584
Lewin’s Three-Step Model 584 • Kotter’s Eight-Step Plan for Implementing
Change 586 • Action Research 587 • Organizational Development 587
Creating a Culture for Change 591
Stimulating a Culture of Innovation 591 • Creating a Learning
Organization 593
Work Stress and Its Management 595
What Is Stress? 595 • Potential Sources of Stress 597 • Individual
Differences 599 • Cultural Differences 600 • Consequences of Stress 601
• Managing Stress 602
Summary and Implications for Managers 606
Self-Assessment Library How Well Do I Respond to Turbulent Change? 578
Myth or Science? “Men Experience More Job Stress Than Women” 596
Self-Assessment Library How Stressful Is My Life? 600
An Ethical Choice Responsibly Managing Your Own Stress 601
glOBalization! Work–Family Stress in Different Cultures 604
Point/Counterpoint Responsible Managers Relieve Stress on Their Employees 607
Questions for Review 608
Experiential Exercise Power and the Changing Environment 608
Ethical Dilemma Changes at WPAC 609
Case Incident 1 Starbucks Returns to Its Roots 610
Case Incident 2 The Rise of Extreme Jobs 610
Appendix A Research in Organizational Behavior 616
Comprehensive Cases 623
Indexes 637
Glindex 663
S A L
SS AA L

About the Authors
xx
Stephen P. Robbins
Education
Ph.D. University of Arizona
Professional Experience
Academic Positions: Professor, San Diego State University, Southern Illinois
University at Edwardsville, University of Baltimore, Concordia University in
Montreal, and University of Nebraska at Omaha.
Research: Research interests have focused on conflict, power, and politics in
organizations, behavioral decision making, and the development of effective
interpersonal skills.
Books Published: World’s best-selling author of textbooks in both management
and organizational behavior. His books have sold more than 5 million copies
and have been translated into 20 languages; editions have been adapted for
Canada, Australia, South Africa, and India, such as these:
• Essentials of Organizational Behavior , 11th ed. (Prentice Hall, 2012)
• Management , 11th ed. with Mary Coulter (Prentice Hall, 2012)
• Fundamentals of Human Resource Management , 10th ed., with David DeCenzo
(Wiley, 2010)
• Prentice Hall’s Self-Assessment Library 3.4 (Prentice Hall, 2010)
• Fundamentals of Management , 8th ed., with David DeCenzo and Mary Coulter
(Prentice Hall, 2013)
• Supervision Today! 7th ed., with David DeCenzo and Robert Wolter (Prentice
Hall, 2013)
• Training in Interpersonal Skills: TIPS for Managing People at Work , 6th ed., with
Phillip Hunsaker (Prentice Hall, 2012)
• Managing Today! 2nd ed. (Prentice Hall, 2000)
• Organization Theory , 3rd ed. (Prentice Hall, 1990)
• The Truth About Managing People , 2nd ed. (Financial Times/Prentice Hall,
2008)
• Decide and Conquer: Make Winning Decisions and Take Control of Your Life
(Financial Times/Prentice Hall, 2004).
Other Interests
In his “other life,” Dr. Robbins actively participates in masters’ track compe-
tition. Since turning 50 in 1993, he has won 18 national championships and
12 world titles. He is the current world record holder at 100 meters (12.37 seconds)
and 200 meters (25.20 seconds) for men 65 and over.

Timothy A. Judge
Education
Ph.D., University of Illinois at Urbana-Champaign
Professional Experience
Academic Positions: Franklin D. Schurz Chair, Department of Management,
Mendoza College of Business, University of Notre Dame; Matherly-McKethan
Eminent Scholar in Management, Warrington College of Business Administra-
tion, University of Florida; Stanley M. Howe Professor in Leadership, Henry B.
Tippie College of Business, University of Iowa; Associate Professor (with tenure),
Department of Human Resource Studies, School of Industrial and Labor Rela-
tions, Cornell University; Lecturer, Charles University, Czech Republic, and Co-
menius University, Slovakia; Instructor, Industrial/Organizational Psychology,
Department of Psychology, University of Illinois at Urbana-Champaign.
Research: Dr. Judge’s primary research interests are in (1) personality, moods,
and emotions; (2) job attitudes; (3) leadership and influence behaviors; and
(4) careers (person–organization fit, career success). Dr. Judge has published
more than 140 articles on these and other major topics in journals such as Jour-
nal of Organizational Behavior, Personnel Psychology, Academy of Management Journal,
Journal of Applied Psychology, European Journal of Personality, and European Journal
of Work and Organizational Psychology .
Fellowship: Dr. Judge is a fellow of the American Psychological Association,
the Academy of Management, the Society for Industrial and Organizational
Psychology, and the American Psychological Society.
Awards: In 1995, Dr. Judge received the Ernest J. McCormick Award for
Distinguished Early Career Contributions from the Society for Industrial and
Organizational Psychology. In 2001, he received the Larry L. Cummings Award
for mid-career contributions from the Organizational Behavior Division of the
Academy of Management. In 2007, he received the Professional Practice Award
from the Institute of Industrial and Labor Relations, University of Illinois.
Books Published: H. G. Heneman III, T. A. Judge, and J. D. Kammeyer-Mueller,
Staffing Organizations, 7th ed. (Madison, WI: Mendota House/Irwin, 2011)
Other Interests
Although he cannot keep up (literally!) with Dr. Robbin’s accomplishments on
the track, Dr. Judge enjoys golf, cooking and baking, literature (he’s a particu-
lar fan of Thomas Hardy and is a member of the Thomas Hardy Society), and
keeping up with his three children, who range in age from 23 to 9.
A B O U T T H E A U T H O R S xxi

Preface
xxii
Welcome to the fifteenth edition of Organizational Behavior! Long considered
the standard for all organizational behavior textbooks, this edition continues
its tradition of making current, relevant research come alive for students. While
maintaining its hallmark features—clear writing style, cutting-edge content, and
engaging pedagogy—the fourteenth edition has been updated to reflect the most
recent research within the field of organizational behavior. This is one of the
most comprehensive and thorough revisions of Organizational Behavior we’ve un-
dertaken, and while we’ve preserved the core material, we’re confident that this
edition reflects the most important research and topical issues facing organiza-
tions, managers, and employees.
Key Changes to the Fifteenth Edition
• The most substantial updating ever. The following sections of each chapter
are new to the fifteenth edition:
• Opening Vignette
• Myth or Science?
• Ethical Choice
• Point/Counterpoint
• Case Incident
• In addition, the following material is substantially revised and updated:
• Case Incident (those not entirely new are revised and updated)
• OB Poll (more than half are new to this edition)
• Ethical Dilemma (more than half are new to this edition)
• Photos/captions (more than half are new to this edition)
• New feature: glOBalization!, which features organizational behavior in an
international context.
• Improved integration of global implications: With the explosion of interna-
tional research, global OB research is now woven into each chapter, rather
than in a stand-alone section at the end of the chapter.
• Revision to Summary and Implications for Managers section, with more
focus on practical ways to apply the material on the job.
• NEW videos—up-to-date videos showing management topics in action,
access to the complete management video library, as well as instructional
materials for integrating clips from popular movies into your class, are at
www.mymanagementlab.com .
Chapter-by-Chapter Changes
Chapter 1 : What Is Organizational Behavior?
• Entirely new Opening Vignette (The New Normal?)
• New feature: glOBalization!
• New Myth or Science? (“Most Acts of Workplace Bullying Are Men Attacking
Women”)
• New OB Model, with better integration with pedagogy (structure) of book

www.mymanagementlab.com

• New Point–Counterpoint (Lost in Translation?)
• New An Ethical Choice (Can You Learn from Failure?)
• New Case Incident (Lessons for ‘Undercover’ Bosses )
• New Case Incident (Era of the Disposable Worker?)
Chapter 2 : Diversity in Organizations
• Entirely new Opening Vignette (The Rise and Fall of Erin Callan)
• New feature: glOBalization!
• New Myth or Science? (“Dual-Career Couples Divorce Less”)
• Enhanced coverage of stereotyping and discrimination research
• Revised content regarding age discrimination and implications of an aging
workforce
• Updates to discussion of disability in the workplace
• Expanded coverage of sexual orientation discrimination
• New material and integration of diversity with international/cultural diversity
• New Point–Counterpoint (Men Have More Mathematical Ability Than Women)
• New An Ethical Choice (Religious Tattoos)
• New Case Incident (Increasing Age Diversity in the Workplace)
• Updated Case Incident (The Flynn Effect)
Chapter 3 : Attitudes and Job Satisfaction
• Entirely new Opening Vignette (What Does SAS Stand For?)
• New feature: glOBalization!
• New Myth or Science? (“Favorable Job Attitudes Make Organizations More
Profitable”)
• Review of recent studies on within-person variation in job attitudes
• New developments in organizational commitment
• Updated material on organizational citizenship behaviors
• New perspectives on attitudes and organizational performance
• New ethical dilemma
• New Point–Counterpoint (Employer–Employee Loyalty Is an Outdated
Concept)
• New An Ethical Choice (Do Employers Owe Workers More Satisfying Jobs?)
• New Case Incident (Crafting a Better Job)
• Updated Case Incident (Long Hours, Hundreds of E-Mails, and No Sleep:
Does This Sound Like a Satisfying Job?)
Chapter 4 : Emotions and Moods
• Entirely new Opening Vignette (Love at Work: Taboo No More?)
• New feature: glOBalization!
• New Myth or Science? (“We Are Better Judges of When Others Are Happy
Than When They Are Sad”)
• Revised introduction to the topic
• Review of research on moods and employee attachment
• New section on “moral emotions”
• Discussion of emotion regulation strategies and their consequences
• New research on gender and emotions
• Updated content on emotional displays at work
• New section on Emotional Intelligence, with substantially more coverage and a
new exhibit
• New Point–Counterpoint (Sometimes Blowing Your Top Is a Good Thing)
• New An Ethical Choice (Schadenfreude)
• New Case Incident (Is It Okay to Cry at Work?)
• Updated Case Incident (Can You Read Emotions from Faces?)
P R E F A C E xxiii

Chapter 5 : Personality and Values
• Entirely new Opening Vignette (Changing of the Guard in Japan: Is it the Econ-
omy, or the Values?)
• New feature: glOBalization!
• New Myth or Science? (“Personality Predicts the Performance of Entrepreneurs”)
• Introduces concepts related to dispositional self- and other-orientation
• New material regarding vocational choices
• New discussion of values and reactions to violations of employee values
• Major revision regarding Hofstede’s model of culture and its consequences
• Updated information on personality and expatriate success
• New Point–Counterpoint (Millennials Are More Narcissistic)
• New An Ethical Choice (Should You Try to Change Someone’s Personality?)
• New Case Incident (Leadership from an Introvert’s Perspective)
• Updated Case Incident (Is There a Price for Being Too Nice?)
Chapter 6 : Perception and Individual Decision Making
• Entirely new Opening Vignette (Do Machines Make Better Decisions?)
• New feature: glOBalization!
• New Myth or Science? (“Creative Decision Making Is a Right-Brain Activity”)
• Review of recent work on self-serving biases
• New information on stereotyping processes
• Discussion of latest trends in decision errors research
• Updated discussion of culture and perceptions
• New section on Financial Decision Making and how it informs to understand
recent and current crises
• New Experiential Exercise
• New Point–Counterpoint (Checklists Lead to Better Decisions)
• New An Ethical Choice (Whose Ethical Standards to Follow?)
• New Case Incident (Computerized Decision Making)
• Updated Case Incident (Predictions That Didn’t Quite Pan Out)
Chapter 7 : Motivation Concepts
• Entirely new Opening Vignette (The Motivations of the 99ers)
• New feature: glOBalization!
• New Myth or Science? (“The Support of Others Improves Our Chances of
Accomplishing Our Goals”)
• New material on psychological need theories
• Increased discussion of employee engagement
• Updates to the discussion on goal-setting theory
• New perspectives on equity and organizational justice
• New Point–Counterpoint (Fear Is a Powerful Motivator)
• New An Ethical Choice (Motivated to Behave Unethically)
• New Case Incident (It’s Not Fair!)
• Updated Case Incident (Bullying Bosses)
Chapter 8 : Motivation: From Concepts to Applications
• Entirely new Opening Vignette (Motivation Minus the Moolah)
• New feature: glOBalization!
• New Myth or Science? (“CEO Pay Can’t Be Measured”)
• Updated discussion of job characteristics
• New coverage of flextime, telecommuting, and related work practices
• Revised discussion of employee empowerment and its effects
• Discussion of innovations in gainsharing practices
xxiv P R E F A C E

P R E F A C E xxv
• New Point–Counterpoint (“If Money Doesn’t Make You Happy, You Aren’t
Spending It Right”)
• New Case Incident (Bonuses Can Backfire)
• Updated Case Incident (Multitasking: A Good Use of Your Time?)
Chapter 9 : Foundations of Group Behavior
• Entirely new Opening Vignette (To the Clickers Go the Spoils)
• New feature: glOBalization!
• New Myth or Science? (“Asians Have Less Ingroup Bias Than Americans”)
• New material on dysfunctional behavior in teams
• Discussion of minority influence on group decision making
• Introduces material on team mental models
• Updated information on group decision errors and groupthink
• New information on international variations in group behavior
• New Point–Counterpoint (Affinity Groups Fuel Business Success)
• New An Ethical Choice (Should You Use Group Peer Pressure?)
• New Case Incident (Negative Aspects of Collaboration?)
• Updated Case Incident (Herd Behavior and the Housing Bubble [and
Collapse])
Chapter 10 : Understanding Work Teams
• Entirely new Opening Vignette (Killing bin Laden)
• New feature: glOBalization!
• New Myth or Science? (“Teams Work Best Under Angry Leaders”)
• Updated discussion of strategies to improve team performance
• Review of research on team decision-making strategies
• New perspectives on creativity in teams
• New material on team proactivity
• Presents new literature on work teams in international contexts
• New Point–Counterpoint (We Can Learn Much about Work Teams from
Studying Sports Teams)
• New An Ethical Choice (Using Global Virtual Teams as an Environmental
Choice)
• New Case Incident (Why Don’t Teams Work Like They’re Supposed To?)
• Updated Case Incident (Multicultural Multinational Teams at IBM)
Chapter 11 : Communication
• Entirely new Opening Vignette (Goldman Rules)
• New feature: glOBalization!
• New Myth or Science? (“We Know What Makes Good Liars Good”)
• New section on Social Networking
• New section on Persuasive Communication strategies
• Discussion of how to frame messages for maximum impact
• Discussion of the effects of authority, expertise, and liking on communica-
tion effectiveness
• Updated discussion of body language in communication
• Introduces new ideas about the effects of electronic communications
• New Point–Counterpoint (Social Networking Is Good Business)
• New An Ethical Choice (The Ethics of Gossip at Work)
• New Case Incident (Using Social Media to Your Advantage)
• Updated Case Incident (Should Companies That Fire Shoot First?)

xxvi P R E FAC E
Chapter 12 : Leadership
• Entirely new Opening Vignette (Making Google’s Leaders)
• New feature: glOBalization!
• New Myth or Science? (“Power Helps Leaders Perform Better”)
• Expanded discussion of leader effects on employee attitudes
• New perspectives on culture and leadership
• New material regarding emotional intelligence and leadership
• Increased consideration of contemporary theories of leadership
• Consideration of “servant leadership”
• Discussion of how leaders can increase employee creativity
• New Point–Counterpoint (Heroes Are Made, Not Born)
• New An Ethical Choice (Do Leaders Have a Responsibility to Protect
Followers?)
• New Case Incident (Leadership Mettle Forged in Battle)
• Updated Case Incident (Leadership Factories)
Chapter 13 : Power and Politics
• Entirely new Opening Vignette (Appearances Can Be Deceiving)
• New feature: glOBalization!
• New Myth or Science? (“Corporate Political Activity Pays”)
• Coverage of latest research on influence tactics
• Revised discussion of sexual harassment
• Updated discussion of political behavior in organizations
• Revision to international issues in power and politics
• New Point–Counterpoint (Power Corrupts People)
• New An Ethical Choice (Should All Sexual Behavior Be Prohibited at Work?)
• New Case Incident (Delegate Power, or Keep it Close?)
• Updated Case Incident (The Persuasion Imperative)
Chapter 14 : Conflict and Negotiation
• Entirely new Opening Vignette (No Conflict at the Post Office. . . Is That
Good?)
• New feature: glOBalization!
• New Myth or Science? (“Communicating Well Is More Important in Cross-
Cultural Negotiations”)
• Updated material on gender and negotiation styles
• New material on individual differences in negotiation styles
• Discussion of emotions in negotiation
• New information on suspicion and deception in negotiation
• Updates to discussion on conflict and conflict management processes
• New Point–Counterpoint (Player–Owner Disputes Are Unnecessary)
• New An Ethical Choice (Using Empathy to Negotiate More Ethically)
• New Case Incident (Choosing Your Battles)
• Updated Case Incident (Mediation: Master Solution to Employment
Disputes?)
Chapter 15 : Foundations of Organization Structure
• Entirely new Opening Vignette (Dismantling a Bureaucracy)
• New feature: glOBalization!
• New Myth or Science? (“Employees Resent Outsourcing”)
• Latest research on boundaryless organizations and their functioning
• Discussion of technology’s influence on organizational structure

P R E F A C E xxvii
• Updated review of the relationship between organizational structure and
attitudes
• New An Ethical Choice (Downsizing with a Conscience)
• New Case Incident (Creative Deviance: Bucking the Hierarchy?)
• Updated Case Incident (Siemens’ Simple Structure—Not)
Chapter 16 : Organizational Culture
• Entirely new Opening Vignette (Ursula M. Burns and the Culture of Xerox)
• New feature: glOBalization!
• New Myth or Science? (“Employees Treat Customers the Same Way the
Organization Treats Them”)
• New review of basic issues in organizational culture and subcultures
• Enhanced discussion of ethical culture
• Review of culture and organizational performance
• Revised discussion of organizational socialization practices and outcomes
• New Point–Counterpoint (Organizations Should Strive to Create a Positive
Organizational Culture)
• New An Ethical Choice (Designing a Culture of Ethical Voice)
• New Case Incident (Did Toyota’s Culture Cause Its Problems?)
• Updated Case Incident (Mergers Don’t Always Lead to Culture Clashes)
Chapter 17 : Human Resource Policies and Practices
• Entirely new Opening Vignette (Testing NFL Quarterbacks)
• New feature: glOBalization!
• New Myth or Science? (“Work Is Making Us Fat”)
• Discussion of the implications of the Great Recession
• New material on legal issues
• Updated discussion of the effects of high performance work practice on
employee attitudes and behavior
• Expanded discussion of the effects of staffing decisions on employee
turnover
• New section on Job Performance and Workplace Civility
• New material related to performance appraisals and rater goals
• New Point–Counterpoint (Social Media Is a Great Source of New Hires)
• New An Ethical Choice (Recruiting the Unemployed)
• New Case Incident (The End of the Performance Appraisal?)
• Updated Case Incident (Job Candidates Without Strong SAT Scores Need
Not Apply)
Chapter 18 : Organizational Change and Stress Management
• Entirely new Opening Vignette (Sweet Changes at Cadbury?)
• New feature: glOBalization!
• New Myth or Science? (“Men Experience More Job Stress Than Women”)
• Updated review of research on individual readiness for organizational
change
• Discussion of maladaptive behavioral response to stress at work
• Updated discussion of coping strategies
• Implications of the stress-health relationship
• New Point–Counterpoint (Responsible Managers Relieve Stress on Their
Employees)
• New An Ethical Choice (Responsibly Managing Your Own Stress)
• New Case Incident (Starbucks Returns to Its Roots)
• Updated Case Incident (The Rise of Extreme Jobs)

xxviii P R E FAC E
Teaching and Learning Support
MyManagementLab ( www.mymanagementlab.com ) is an easy-to-use online
tool that personalizes course content and provides robust assessment and re-
porting to measure student and class performance. All the resources you need
for course success are in one place—flexible and easily adapted for your course
experience.
Instructor’s Resource Center
At www.pearsonhighered.com/irc , instructors can access a variety of print, digi-
tal, and presentation resources available with this text in downloadable format.
Registration is simple and gives you immediate access to new titles and new
editions. As a registered faculty member, you can download resource files and
receive immediate access and instructions for installing course management
content on your campus server.
If you need assistance, our dedicated technical support team is ready to
help with the media supplements that accompany this text. Visit 247pearsoned
.custhelp.com for answers to frequently asked questions and toll-free user
support phone numbers.
The following supplements are available to adopting instructors (for
detailed descriptions, please visit www.pearsonhighered.com/irc ):
• Instructor’s Manual—updated and revised to provide ideas and resources in
the classroom.
• Test Item File—Revised and updated to include questions that require stu-
dents to apply the knowledge that they’ve read about in the text through
Learning Objectives and Learning Outcomes. Questions are also tagged to
reflect the AACSB Learning Standards.
• TestGen Test Generating Software—Test management software that con-
tains all material from the Test Item File. This software is completely user-
friendly and allows instructors to view, edit, and add test questions with just
a few mouse clicks. All of our TestGens are converted for use in Blackboard
and WebCT and are available for download from www.pearsonhighered
.com/irc.
• PowerPoint Presentation—A ready-to-use PowerPoint slideshow designed
for classroom presentation. Use it as is, or edit content to fit your individual
classroom needs.
• Image Library—includes all the charts, tables, and graphs that are found in
the text.
Videos on DVD
Adopters can access the 48 videos on the 2013 Organizational Behavior Video
Library DVD. These videos have been produced to depict real-world OB issues
and give students a taste of the multi-faceted nature of OB in real companies.
Learning Management Systems
BlackBoard and WebCT Course Cartridges are available for download from
www.pearsonhighered.com/irc. These standard course cartridges contain the
Instructor’s Manual, TestGen, Instructor PowerPoints, and when available, Stu-
dent PowerPoints and Student Data Files.

www.mymanagementlab.com

www.pearsonhighered.com/irc

P R E F A C E xxix
CourseSmart eTextbooks Online
Developed for students looking to save money on required or recommended text-
books, CourseSmart eTextbooks online save students money compared with the
suggested list price of the print text. Students simply select their eText by title
or author and purchase immediate access to the content for the duration of the
course using any major credit card. With CourseSmart eText, students can search
for specific keywords or page numbers, make notes online, print reading assign-
ments that incorporate lecture notes, and bookmark important passages for later
review. For more information, or to purchase a CourseSmart eTextbook, visit
www.coursesmart.com .
Pearson’s Self-Assessment
Library (S.A.L.)
A hallmark of the Robbins series, S.A.L. is a unique learning tool that allows you
to assess your knowledge, beliefs, feelings, and actions in regard to a wide range of
personal skills, abilities, and interests. Self-assessments have been integrated into
each chapter, including a self-assessment at the beginning of each chapter. S.A.L.
helps students better understand their interpersonal and behavioral skills as they
relate to the theoretical concepts presented in each chapter.
Highlights
• 69 research-based self-assessments —All 69 instruments of our collection are
from sources such as Journal of Social Behavior and Personality, Harvard Business
Review, Organizational Behavior: Experiences and Cases, Journal of Experimental
Education, Journal of Applied Measurement, and more.
• Work–life and career focused —All self-assessments are focused to help indi-
viduals better manage their work lives or careers. Organized in four parts,
these instruments offer you one source from which to learn more about
yourself.
• Choice of formats —The Prentice Hall Self-Assessment Library is available in
CD-ROM, online, or print format.
• Save feature —Students can take the self-assessments an unlimited number
of times, and they can save and print their scores for class discussion.
• Scoring key —The key to the self-assessments has been edited by Steve
Robbins to allow students to quickly make sense of the results of their score.
• Instructor’s manual —An Instructor’s Manual guides instructors in interpret-
ing self-assessments and helps facilitate better classroom discussion.

www.coursesmart.com

Acknowledgments
Getting this book into your hands was a team effort. It took faculty reviewers
and a talented group of designers and production specialists, editorial per-
sonnel, and marketing and sales staff.
More than one hundred instructors reviewed parts or all of Organizational
Behavior, Fifteenth Edition. Their comments, compliments, and suggestions
have significantly improved the final product. The authors wish to thank John D.
Kammeyer-Mueller of the University of Florida for help with several key aspects
of this revision. The authors would also like to extend their sincerest thanks to
the following instructors:
xxx
Lee Boam , University of Utah
Andres Johnson , Santa Clara University
Edward Lisoski , Northeastern University
Douglas Mahony , Lehigh University
Douglas McCabe , Georgetown University
Bradley Norris , Baylor University
Jonelle Roth , Michigan State University
Philip Roth , Clemson University
Dale Rude , University of Houston
Holly Schroth , University of California at
Berkeley
Jody Tolan , University of Southern California
Debra Schneck , Indiana University
Marilyn Wesner , George Washington
University
Over the last editions this text has grown stronger with the contribution and
feedback of the following instructors:
David Abramis , California State University
Chris Adalikwu , Concordia College
Basil Adams , Notre Dame de Namur
University
Janet Adams , Kennesaw State University
Cheryl Adkins , Longwood College
Vicky Aitken , St. Louis Community College
David Albritton , Northern Arizona University
Bradley Alge , Purdue University
Lois Antonen , CSUS
Lucy Arendt , University of Wisconsin, Green Bay
Anke Arnaud , University of Central Florida
Mihran Aroian , University of Texas, Austin
Gary Ballinger , Purdue University
Deborah Balser , University of Missouri at
St. Louis
Christopher Barlow , DePaul University
Joy Benson , University of Wisconsin at
Green Bay
Lehman Benson III , University of Arizona
Jacqui Bergman , Appalachian State
University
Anne Berthelot , University of Texas at
El Paso
David Bess , Shidler College of Business at the
University of Hawaii
Bruce Bikle , California State University,
Sacramento
Richard Blackburn , University of North
Carolina–Chapel Hill
Weldon Blake , Bethune-Cookman College
Carl Blencke , University of Central Florida
Michael Bochenek , Elmhurst College
Alicia Boisnier , State University of New York
William H. Bommer , Cleveland State
University
Bryan Bonner , University of Utah
Jessica Bradley , Clemson University
Dr. Jerry Bream , Empire State College/
Niagara Frontier Center
Jim Breaugh , University of Missouri
Peggy Brewer , Eastern Kentucky University
Deborah Brown , North Carolina State
University
Reginald Bruce , University of Louisville
Jeff Bruns , Bacone College
Pamela Buckle , Adelphi University
Patricia Buhler , Goldey-Beacom College
Allen Bures , Radford University
Edith Busija , University of Richmond
Holly Buttner , University of North Carolina
at Greensboro
Michael Cafferky , Southern Adventist
University
Scott Campbell , Francis Marion University
Elena Capella , University of San Francisco

AC K N O W L E D G M E N T S xxxi
Don Capener , Monmouth University
Dan Caprar , University of Iowa
David Carmichael , Oklahoma City University
Carol Carnevale , SUNY Empire State College
Donald W. Caudill , Bluefield College
Suzanne Chan , Tulane University
Anthony Chelte , Midwestern State University
Bongsoon Cho , State University of
New York—Buffalo
Savannah Clay , Central Piedmont Community
College
David Connelly , Western Illinois State
University
Jeffrey Conte , San Diego State University
Jane Crabtree , Benedictine University
Suzanne Crampton , Grand Valley State
University
Douglas Crawford , Wilson College
Michael Cruz , San Jose State University
Robert Cyr , Northwestern University
Evelyn Dadzie , Clark Atlanta University
Joseph Daly , Appalachian State University
Denise Daniels , Seattle Pacific University
Marie Dasborough , Oklahoma State
University
Nancy Da Silva , San Jose State University
Christine Day , Eastern Michigan University
Emmeline de Pillis , University of Hawaii, Hilo
Kathy Lund Dean , Idaho State University
Roger Dean , Washington & Lee University
Robert DelCampo , University of New Mexico
Kristen Detienne , Brigham Young University
Doug Dierking , University of Texas at Austin
Cynthia Doil , Southern Illinois University
Jennifer Dose , Messiah College
Ceasar Douglas , Florida State University
David Duby , Liberty University
Ken Dunegan , Cleveland State University
Michael Dutch , Greensboro College
Kathleen Edwards , University of Texas at
Austin
Berrin Erdogan , Portland State University
Ellen Fagenson Eland , George Mason
University
Lenny Favara , Central Christian College
Claudia Ferrante , U.S. Air Force Academy
Andy Fitorre , Nyack College
Kathleen Fleming , Averett University
Erin Fluegge , University of Florida
Edward Fox , Wilkes University
Alison Fragale , University of North Carolina
at Chapel Hill
Lucy Franks , Bellevue University
Dean Frear , Wilkes University
Jann Freed , Central College
Crissie Frye , Eastern Michigan University
Diane Galbraith , Slippery Rock University
Carolyn Gardner , Radford University
Janice Gates , Western Illinois University
Ellen Kaye Gehrke , Alliant International
University
James Gelatt , University of Maryland
University College
Joe Gerard , University of Wisconsin at
Milwaukee
Matthew Giblin , Southern Illinois University
Donald Gibson , Fairfield University
Cindi Gilliland , The University of Arizona
Mary Giovannini , Truman State University
David Glew , University of North Carolina at
Wilmington
Leonard Glick , Northeastern University
Reginald Goodfellow , California State
University
Jeffrey Goldstein , Adelphi University
Jodi Goodman , University of Connecticut
Claude Graeff , Illinois State University
Richard Grover , University of Southern Maine
W. Lee Grubb III , East Carolina University
John Guarino , Averett University
Rebecca Guidice , University of Nevada
at Las Vegas
Andra Gumbus , Sacred Heart University
Linda Hackleman , Concordia University
Austin
Deniz Hackner , Tidewater Community
College
Michael Hadani , Long Island University
Jonathon Halbesleben , University of
Missouri-Columbia
Dan Hallock , University of North Alabama
Tracey Rockett Hanft , University of Texas
at Dallas
Edward Hampton , University of Central
Florida
Vernard Harrington , Radford University
Nell Hartley , Robert Morris University
Barbara Hassell , Indiana University, Kelley
School of Business
Erin Hayes , George Washington University
Tom Head , Roosevelt University
Douglas Heeter , Ferris State University
David Henderson , University of Illinois
at Chicago
Scott Henley , Oklahoma City University
Ted Herbert , Rollins College
Susan Herman , University of Alaska Fairbanks
James Hess , Ivy Tech Community College
Ronald Hester , Marymount University

Patricia Hewlin , Georgetown University
Chad Higgins , University of Washington
Kim Hinrichs , Minnesota State University
Mankato
Kathie Holland , University of Central Florida
Elaine Hollensbe , University of Cincinnati
Kristin Holmberg-Wright , University of
Wisconsin at Parkside
Brooks Holtom , Georgetown University
Lisa Houts , California State University
Fullerton
Abigail Hubbard , University of Houston
Paul Hudec , Milwaukee School of Engineering
Stephen Humphrey , Florida State University
Charlice Hurst , University of Florida
Warren Imada , Leeward Community College
Gazi Islam , Tulane University
Alan Jackson , Peru State College
Christine Jackson , Purdue University
Marsha Jackson , Bowie State University
Kathryn Jacobson , Arizona State University
Paul Jacques , Western Carolina University
David Jalajas , Long Island University
Elizabeth Jamison , Radford University
Stephen Jenner , California State University,
Dominguez Hills
John Jermier , University of South Florida
Jack Johnson , Consumnes River College
Michael Johnson , University of Washington
David Jones , South University
Ray Jones , University of Pittsburgh
Anthony Jost , University of Delaware
Louis Jourdan , Clayton College
Rusty Juban , Southeastern Illinois University
Carole L. Jurkiewicz , Louisiana State
University
John Kammeyer-Mueller , University
of Florida
Edward Kass , Saint Joseph’s University
Marsha Katz , Governors State College
James Katzenstein , California State University
John Keiser , SUNY College at Brockport
Mark Kendrick , Methodist University
Mary Kern , Baruch College
Robert Key , University of Phoenix
Sigrid Khorram , University of Texas at
El Paso
Hal Kingsley , Erie Community College
Jeffrey Kobles , California State University
San Marcos
Jack Kondrasuk , University of Portland
Leslie A. Korb , University of Nebraska at
Kearney
Glen Kreiner , University of Cincinnati
James Kroeger , Cleveland State University
Frederick Lane , Baruch College
Rebecca Lau , Virginia Polytechnic Institute
and State University
David Leuser , Plymouth State College
Julia Levashina , Indiana State University
Kokomo
Benyamin Lichtenstein , University of
Massachusetts at Boston
Robert Liden , University of Illinois at Chicago
Don Lifton , Ithaca College
Ginamarie Ligon , Villanova University
Beth Livingston , University of Florida
Barbara Low , Dominican University
Doyle Lucas , Anderson University
Alexandra Luong , University of Minnesota
Rick Maclin , Missouri Baptist University
Peter Madsen , Brigham Young University
Lou Marino , University of Alabama
Catherine Marsh , Northpark University
J. David Martin , Midwestern State University
Timothy A. Matherly , Florida State University
John Mattoon , State University of New York
Paul Maxwell , Saint Thomas University
Brenda McAleer , University of Maine at
Augusta
Christina McCale , Regis College
Don McCormick , California State University
Northridge
James McElroy , Iowa State University
Bonnie McNeely , Murray State University
Melony Mead , University of Phoenix
Steven Meisel , La Salle University
Nancy Meyer-Emerick , Cleveland State
University
Catherine Michael , St. Edwards University
Sandy Miles , Murray State University
Janice Miller , University of Wisconsin at
Milwaukee
Leann Mischel , Susquehanna University
Atul Mitra , University of Northern Iowa
Linda Morable , Richland College
Paula Morrow , Iowa State University
Mark Mortensen , Massachusetts Institute
of Technology
Lori Muse , Western Michigan University
Padmakumar Nair , University of Texas at
Dallas
Judy Nixon , University of Tennessee at
Chattanooga
Jeffrey Nystrom , University of Colorado at
Denver
Alison O’Brien , George Mason University
Heather Odle-Dusseau , Clemson University
Miguel Olivas-Lujan , Lujan Clarion University
xxxii A C K N O W L E D G M E N T S

AC K N O W L E D G M E N T S xxxiii
Kelly Ottman , University of Wisconsin at
Milwaukee
Cynthia Ozeki , California State University,
Dominguez Hills
Peg Padgett , Butler University
Jennifer Palthe , Western Michigan University
Dennis Passovoy , University of Texas at
Austin
Karen Paul , Florida International University
Laura Finnerty Paul , Skidmore College
Anette Pendergrass , Arkansas State
University at Mountain Home
Bryan Pesta , Cleveland State University
Jeff Peterson , University of Washington
Nanette Philibert , Missouri Southern
State University
Larry Phillips , Indiana University South Bend
William Pinchuk , Rutgers University at
Camden
Eric Popkoff , Brooklyn College
Paul Preston , University of Montevallo
Scott Quatro , Grand Canyon University
Aarti Ramaswami , Indiana University
Bloomington
Jere Ramsey , Cal Poly at San Luis Obispo
Amy Randel , San Diego State University
Anne Reilly , Loyola University Chicago
Clint Relyea , Arkansas State University
Herbert Ricardo , Indian River Community
College
David Ritchey , University of Texas at Dallas
Chris Roberts , University of Massachusetts
Amherst
Sherry Robinson , Pennsylvania State
University Hazleton
Christopher Ann Robinson-Easley ,
Governors State University
Joe Rode , Miami University
Bob Roller , LeTourneau University
Andrea Roofe , Florida International
University
Craig Russell , University of Oklahoma at
Norman
Manjula Salimath , University of North Texas
Mary Saunders , Georgia Gwinnett College
Andy Schaffer , North Georgia College and
State University
Elizabeth Scott , Elizabeth City University
Mark Seabright , Western Oregon University
Joseph Seltzer , LaSalle University
John Shaw , Mississippi State University
John Sherlock , Western Carolina University
Daniel Sherman , University of Alabama,
Huntsville
Heather Shields , Texas Tech University
Ted Shore , California State University at
Long Beach
Stuart Sidle , University of New Haven
Bret Simmons , University of Nevada Reno
Randy Sleeth , Virginia Commonwealth
University
William Smith , Emporia State University
Kenneth Solano , Northeastern University
Shane Spiller , Morehead State University
Lynda St. Clair , Bryant University
John B. Stark , California State University,
Bakersfield
Merwyn Strate , Purdue University
Joo-Seng Tan , Cornell University
Karen Thompson , Sonoma State University
Linda Tibbetts , Antioch University
McGregor
Ed Tomlinson , John Carroll University
Bob Trodella , Webster University
Tom Tudor , University of Arkansas at Little
Rock
William D. Tudor , Ohio State University
Daniel Turban , University of Missouri
Albert Turner , Webster University
Jim Turner , Morehead State University
Leslie Tworoger , Nova Southeastern
University
M. A. Viets , University of Vermont
Roger Volkema , American University
William Walker , University of Houston
Ian Walsh , Boston College
Charles F. Warren , Salem State College
Christa Washington , Saint Augustine’s
College
Jim Westerman , Appalachian State University
William J. White , Northwestern University
David Whitlock , Southwest Baptist University
Dan Wiljanen , Grand Valley State University
Dean Williamson , Brewton-Parker College
Hilda Williamson , Hampton University
Alice Wilson , Cedar Crest College
Barry Wisdom , Southeast Missouri State
University
Craig Wishart , Fayetteville State University
Laura Wolfe , Louisiana State University
Melody Wollan , Eastern Illinois University
Evan Wood , Taylor University Fort Wayne
Chun-Sheng Yu , University of Houston-
Victoria
Jun Zhao , Governors State University
Lori Ziegler , University of Texas at Dallas
Mary Ellen Zuckerman , State University
of New York at Geneseo
Gail Zwart , Riverside Community College

xxxiv A C K N O W L E D G M E N T S
We owe a debt of gratitude to all those at Pearson Education who have sup-
ported this text over the past 30 years and who have worked so hard on the de-
velopment of this latest edition. On the development and editorial side, we want
to thank Elisa Adams, Development Editor; Steve Deitmer, Director of Develop-
ment; Ashley Santora, Director of Editorial Services; Brian Mickelson, Acquisi-
tions Editor; and Sally Yagan, Editorial Director. On the design and production
side, Judy Leale, Senior Managing Editor, did an outstanding job, as did Becca
Groves, Production Project Manager, and Nancy Moudry, Photo Development
Editor. Last but not least, we would like to thank Nikki Ayana Jones, Senior
Marketing Manager; Patrice Lumumba Jones, Vice President Director of Market-
ing; and their sales staff, who have been selling this book over its many editions.
Thank you for the attention you’ve given to this book.

Organizational
Behavior

THE NEW NORMAL?
2
S
cott Nicholson sits alone in his parents’ house in suburban Boston. His
parents have long since left for work. He lifts his laptop from a small
table on which his mother used to have a vase with flowers. This day will
be like tomorrow, and tomorrow will be like today.
On his laptop, Scott searches corporate Web sites for job openings.
Today, he finds one, and he mails off a résumé and cover letter. It’s a rou-
tine he repeats nearly every day, applying to four to five jobs a week, week
after week.
Despite graduating from Colgate University with a 4.0 GPA, Scott has
been job-hunting for 5 months. His myriad applications have produced only
one offer: A $40,000-a-year job as an associate claims adjuster at Hanover
Insurance Group in Worcester. He turned the offer down. “The conversation
I’m going to have with my parents now that I’ve turned down this job is more
of a concern to me than turning down the job,” Scott said.
Why is Scott more concerned with his parents’ reaction than he is with
finding a job? To some degree, this is a reflection of the job offer (too low
a salary, too small a company, too limited a job description). However, it
also suggests a generational shift in thinking. While the job market for new
entrants is perhaps the most sluggish in memory, new college graduates
remain committed to following their dreams and holding out high hopes for
their careers.
Scott’s father, David Nicholson, 57, has an established managerial career,
with a household income of $175,000/year. Early in his career, David said,
he was less concerned with starting off with the right job than his son is
now. “You maneuvered and you did not worry what the maneuvering would
lead to,” David said. “You know it would lead to something good.” Scott’s
grandfather, William Nicholson, a retired stock broker, has even more trou-
ble understanding Scott’s travails. “I view what is happening to Scott with
dismay,” the grandfather said. Despite feeling pressure from his parents to
find a job (“I am beginning to realize that refusal is going to have repercus-
sions”), Scott remains undaunted: “I am absolutely certain that my job hunt
will eventually pay off.”
Scott is not alone. In the past 5 years, millions of U.S. workers have lost
their jobs, and millions of new entrants—many of them, like Scott, under 30—
have had trouble finding suitable work.
Sources: L. Uchitelle, “A New Generation, an Elusive American Dream” New York Times (July 7, 2010),
pp. A1, A11; B. Levin, “Sending Out an S.O.S.: Who Will Give This a Handout/Job?” Dealbreaker
(July 7, 2010), http://dealbreaker.com/tag/scott-nicholson/ .
LEARNING
OBJECTIVES
After studying this chapter,
you should be able to:
1 Demonstrate the
importance of interpersonal
skills in the workplace.
2 Describe the manager’s
functions, roles, and skills.
3 Define organizational
behavior ( OB ).
4 Show the value to OB of
systematic study.
5 Identify the major
behavioral science
disciplines that contribute
to OB.
6 Demonstrate why few
absolutes apply to OB.
7 Identify the challenges and
opportunities managers
have in applying OB
concepts.
8 Compare the three levels
of analysis in this book’s
OB model.
MyManagementLab
Access a host of interactive
learning aids to help strengthen
your understanding of the
chapter concepts at
www.mymanagementlab.com

www.mymanagementlab.com

http://dealbreaker.com/tag/scott-nicholson/

What Is
Organizational
Behavior? 1
The stellar universe is not so difficult
of comprehension as the real actions
of other people. —Marcel Proust
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4 CHAPTER 1 What Is Organizational Behavior?
T he details of this story might be disheartening to read, but they accurately reflect some of the problems faced by the contemporary workforce. The story also highlights several issues of interest to organizational behavior
researchers, including motivation, emotions, personality, and communication.
Through the course of this book, you’ll learn how all these elements can be
studied systematically.
You’ve probably made many observations about people’s behavior in your
life. In a way, you are already proficient at seeing some of the major themes in
organizational behavior. At the same time, you probably have not had the tools
to make these observations systematically. This is where organizational behavior
comes into play. And, as we’ll learn, it is much more than common sense, intu-
ition, and soothsaying.
To see how far common sense gets you, try the following from the Self-
Assessment Library.
S A L
SELF-ASSESSMENT LIBRARY
How Much Do I Know About Organizational Behavior?
In the Self-Assessment Library (available on CD and online), take assessment IV.G.1
(How Much Do I Know About OB?) and answer the following questions:
1. How did you score? Are you surprised by your score?
2. How much of effective management do you think is common sense? Did
your score on the test change your answer to this question?
1 Demonstrate the impor-
tance of interpersonal skills
in the workplace.
Until the late 1980s, business school curricula emphasized the technical aspects
of management, focusing on economics, accounting, finance, and quantitative
techniques. Course work in human behavior and people skills received rela-
tively less attention. Over the past three decades, however, business faculty have
come to realize the role that understanding human behavior plays in determin-
ing a manager’s effectiveness, and required courses on people skills have been
added to many curricula. As the director of leadership at MIT’s Sloan School of
Management put it, “M.B.A. students may get by on their technical and quan-
titative skills the first couple of years out of school. But soon, leadership and
communication skills come to the fore in distinguishing the managers whose
careers really take off.” 1
Developing managers’ interpersonal skills also helps organizations attract
and keep high-performing employees. Regardless of labor market conditions,
outstanding employees are always in short supply. 2 Companies known as good
places to work—such as Starbucks, Adobe Systems, Cisco, Whole Foods, Google,
American Express, Amgen, Pfizer, and Marriott—have a big advantage. A recent
survey of hundreds of workplaces, and more than 200,000 respondents, showed
the social relationships among co-workers and supervisors were strongly related
to overall job satisfaction. Positive social relationships also were associated with
lower stress at work and lower intentions to quit. 3 So having managers with good
interpersonal skills is likely to make the workplace more pleasant, which in turn
makes it easier to hire and keep qualified people. Creating a pleasant work-
place also appears to make good economic sense. Companies with reputations
The Importance of Interpersonal Skills

What Managers Do 5
as good places to work (such as Forbes’ “100 Best Companies to Work For in
America”) have been found to generate superior financial performance. 4
We have come to understand that in today’s competitive and demanding
workplace, managers can’t succeed on their technical skills alone. They also
have to have good people skills. This book has been written to help both man-
agers and potential managers develop those people skills.
Succeeding in management today
requires good interpersonal skills.
Communication and leadership
skills distinguish managers such as
John Chambers, who rise to the
top of their profession. Chambers
is CEO of Cisco Systems, the world’s
largest maker of networking equip-
ment. He is respected as a visionary
leader and innovator who has the
ability to drive an entrepreneurial
culture. As an effective communica-
tor, Chambers is described as warm-
hearted and straight talking. In this
photo Chambers speaks during a
launch ceremony of a green tech-
nology partnership Cisco formed
with a university in China.
Let’s begin by briefly defining the terms manager and organization —the place
where managers work. Then let’s look at the manager’s job; specifically, what
do managers do?
Managers get things done through other people. They make decisions,
allocate resources, and direct the activities of others to attain goals. Managers
do their work in an organization , which is a consciously coordinated social
unit, composed of two or more people, that functions on a relatively contin-
uous basis to achieve a common goal or set of goals. By this definition, man-
ufacturing and service firms are organizations, and so are schools, hospitals,
churches, military units, retail stores, police departments, and local, state,
and federal government agencies. The people who oversee the activities of
What Managers Do
2 Describe the manager’s
functions, roles, and skills.
manager An individual who achieves
goals through other people.
organization A consciously
coordinated social unit, composed of
two or more people, that functions on
a relatively continuous basis to achieve
a common goal or set of goals.
MyManagementLab
For an interactive application of this
topic, check out this chapter’s
simulation activity at
www.mymanagementlab.com .
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: C
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in
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o
to
s
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s,
I
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c.

www.mymanagementlab.com

6 CHAPTER 1 What Is Organizational Behavior?
others and who are responsible for attaining goals in these organizations
are managers (sometimes called administrators, especially in not-for-profit
organizations).
Management Functions
In the early part of the twentieth century, French industrialist Henri Fayol wrote
that all managers perform five management functions: planning, organizing,
commanding, coordinating, and controlling. 5 Today, we have condensed these
to four: planning, organizing, leading, and controlling.
Because organizations exist to achieve goals, someone has to define those
goals and the means for achieving them; management is that someone. The
planning function encompasses defining an organization’s goals, establishing
an overall strategy for achieving those goals, and developing a comprehen-
sive set of plans to integrate and coordinate activities. Evidence indicates this
function increases the most as managers move from lower-level to mid-level
management. 6
Managers are also responsible for designing an organization’s structure. We
call this function organizing . It includes determining what tasks are to be done,
who is to do them, how the tasks are to be grouped, who reports to whom, and
where decisions are to be made.
Every organization contains people, and it is management’s job to direct and
coordinate those people. This is the leading function. When managers motivate
employees, direct their activities, select the most effective communication chan-
nels, or resolve conflicts among members, they’re engaging in leading.
To ensure things are going as they should, management must monitor the
organization’s performance and compare it with previously set goals. If there are
any significant deviations, it is management’s job to get the organization back on
track. This monitoring, comparing, and potential correcting is the controlling
function.
So, using the functional approach, the answer to the question “What do
managers do?” is that they plan, organize, lead, and control.
Management Roles
In the late 1960s, Henry Mintzberg, then a graduate student at MIT, under-
took a careful study of five executives to determine what they did on their
jobs. On the basis of his observations, Mintzberg concluded that managers per-
form ten different, highly interrelated roles—or sets of behaviors. 7 As shown in
Exhibit 1-1 , these ten roles are primarily (1) interpersonal, (2) informational,
or (3) decisional.
Interpersonal Roles All managers are required to perform duties that are
ceremonial and symbolic in nature. For instance, when the president of a
college hands out diplomas at commencement or a factory supervisor gives a
group of high school students a tour of the plant, he or she is acting in a fig-
urehead role. All managers also have a leadership role. This role includes hiring,
training, motivating, and disciplining employees. The third role within the
interpersonal grouping is the liaison role, or contacting others who provide
the manager with information. The sales manager who obtains information
from the quality-control manager in his or her own company has an internal
liaison relationship. When that sales manager has contacts with other sales
executives through a marketing trade association, he or she has an outside
liaison relationship.

What Managers Do 7
Informational Roles All managers, to some degree, collect information from
outside organizations and institutions, typically by scanning the news media
(including the Internet) and talking with other people to learn of changes in
the public’s tastes, what competitors may be planning, and the like. Mintzberg
called this the monitor role. Managers also act as a conduit to transmit infor-
mation to organizational members. This is the disseminator role. In addition,
managers perform a spokesperson role when they represent the organization to
outsiders.
Decisional Roles Mintzberg identified four roles that require making choices.
In the entrepreneur role, managers initiate and oversee new projects that will im-
prove their organization’s performance. As disturbance handlers, managers take
corrective action in response to unforeseen problems. As resource allocators,
planning A process that includes
defining goals, establishing strategy,
and developing plans to coordinate
activities.
organizing Determining what tasks
are to be done, who is to do them,
how the tasks are to be grouped, who
reports to whom, and where decisions
are to be made.
leading A function that includes
motivating employees, directing
others, selecting the most effective
communication channels, and
resolving conflicts.
controlling Monitoring activities to
ensure they are being accomplished as
planned and correcting any significant
deviations.
Role Description
Interpersonal
Figurehead Symbolic head; required to perform a number of routine duties
of a legal or social nature
Leader Responsible for the motivation and direction of employees
Liaison Maintains a network of outside contacts who provide favors
and information
Informational
Monitor Receives a wide variety of information; serves as nerve center
of internal and external information of the organization
Disseminator Transmits information received from outsiders or from other
employees to members of the organization
Spokesperson Transmits information to outsiders on organization’s plans,
policies, actions, and results; serves as expert on organization’s
industry
Decisional
Entrepreneur Searches organization and its environment for opportunities
and initiates projects to bring about change
Disturbance handler Responsible for corrective action when organization faces
important, unexpected disturbances
Resource allocator Makes or approves significant organizational decisions
Negotiator Responsible for representing the organization at major
negotiations
Minztberg’s Managerial Roles
Source: Adapted from The Nature of Managerial Work by H. Mintzberg. Copyright © 1973 by H. Mintzberg. MINTZBERG, HENRY,
THE NATURE OF MANAGERIAL WORK, 1st Edition, © 1980, pp. 92–93. Reprinted with permission of Pearson Education, Inc.,
Upper Saddle River, NJ.
Exhibit 1-1

8 CHAPTER 1 What Is Organizational Behavior?
managers are responsible for allocating human, physical, and monetary re-
sources. Finally, managers perform a negotiator role, in which they discuss issues
and bargain with other units to gain advantages for their own unit.
Management Skills
Still another way of considering what managers do is to look at the skills or
competencies they need to achieve their goals. Researchers have identified a
number of skills that differentiate effective from ineffective managers. 8
Technical Skills Technical skills encompass the ability to apply specialized
knowledge or expertise. When you think of the skills of professionals such as civil
engineers or oral surgeons, you typically focus on the technical skills they have
learned through extensive formal education. Of course, professionals don’t have
a monopoly on technical skills, and not all technical skills have to be learned
in schools or other formal training programs. All jobs require some specialized
expertise, and many people develop their technical skills on the job.
Human Skills The ability to understand, communicate with, motivate,
and support other people, both individually and in groups, defines hu-
man skills . Many people are technically proficient but poor listeners, un-
able to understand the needs of others, or weak at managing conflicts.
Because managers get things done through other people, they must have
good human skills.
Conceptual Skills Managers must have the mental ability to analyze and diag-
nose complex situations. These tasks require conceptual skills . Decision mak-
ing, for instance, requires managers to identify problems, develop alternative
solutions to correct those problems, evaluate those alternative solutions, and
select the best one. After they have selected a course of action, managers must
be able to organize a plan of action and then execute it. The ability to integrate
new ideas with existing processes and innovate on the job are also crucial con-
ceptual skills for today’s managers.
Effective versus Successful Managerial Activities
Fred Luthans and his associates looked at what managers do from a somewhat
different perspective. 9 They asked, “Do managers who move up the quickest in an
organization do the same activities and with the same emphasis as managers who
do the best job?” You might think the answer is yes, but that’s not always the case.
Luthans and his associates studied more than 450 managers. All engaged in
four managerial activities:
1. Traditional management. Decision making, planning, and controlling.
2. Communication. Exchanging routine information and processing
paperwork.
3. Human resource management. Motivating, disciplining, managing con-
flict, staffing, and training.
4. Networking. Socializing, politicking, and interacting with outsiders.
The “average” manager spent 32 percent of his or her time in traditional
management activities, 29 percent communicating, 20 percent in human
resource management activities, and 19 percent networking. However, the time
and effort different individual managers spent on those activities varied a great
deal. As shown in Exhibit 1-2 , among managers who were successful (defined
in terms of speed of promotion within their organization), networking made

What Managers Do 9
the largest relative contribution to success, and human resource manage-
ment activities made the least relative contribution. Among effective manag-
ers (defined in terms of quantity and quality of their performance and the
satisfaction and commitment of employees), communication made the largest
relative contribution and networking the least. More recent studies in Australia,
Israel, Italy, Japan, and the United States confirm the link between network-
ing and social relationships and success within an organization. 10 And the con-
nection between communication and effective managers is also clear. A study
of 410 U.S. managers indicates those who seek information from colleagues
and employees—even if it’s negative—and who explain their decisions are the
most effective. 11
This research offers important insights. Successful managers give almost
the opposite emphases to traditional management, communication, human
resource management, and networking as do effective managers. This find-
ing challenges the historical assumption that promotions are based on perfor-
mance, and it illustrates the importance of networking and political skills in
getting ahead in organizations.
A Review of the Manager’s Job
One common thread runs through the functions, roles, skills, activities, and
approaches to management: Each recognizes the paramount importance of
managing people, whether it is called “the leading function,” “interpersonal
roles,” “human skills,” or “human resource management, communication, and
networking activities.” It’s clear managers must develop their people skills to be
effective and successful.
technical skills The ability to apply
specialized knowledge or expertise.
human skills The ability to work
with, understand, and motivate other
people, both individually and in
groups.
conceptual skills The mental ability
to analyze and diagnose complex
situations.
Average
managers
Effective
managers
Successful
managers
19% 19%
48%
11%
11%
28%
13%
26%
44%
20%
29%
32%
Traditional management Communication
Human resource management Networking
Allocation of Activities by Time
Source: Based on F. Luthans, R. M. Hodgetts, and S. A. Rosenkrantz, Real Managers (Cambridge, MA: Ballinger, 1988).
Exhibit 1-2

10 CHAPTER 1 What Is Organizational Behavior?
We’ve made the case for the importance of people skills. But neither this book
nor the discipline on which it is based is called “people skills.” The term that is
widely used to describe the discipline is organizational behavior.
Organizational behavior (often abbreviated OB) is a field of study that
investigates the impact that individuals, groups, and structure have on behav-
ior within organizations, for the purpose of applying such knowledge toward
improving an organization’s effectiveness. That’s a mouthful, so let’s break
it down.
Organizational behavior is a field of study, meaning that it is a distinct area
of expertise with a common body of knowledge. What does it study? It studies
three determinants of behavior in organizations: individuals, groups, and struc-
ture. In addition, OB applies the knowledge gained about individuals, groups,
and the effect of structure on behavior in order to make organizations work
more effectively.
To sum up our definition, OB is the study of what people do in an orga-
nization and how their behavior affects the organization’s performance. And
because OB is concerned specifically with employment-related situations, you
should not be surprised that it emphasizes behavior as related to concerns
such as jobs, work, absenteeism, employment turnover, productivity, human
performance, and management.
Although debate exists about the relative importance of each, OB in-
cludes the core topics of motivation, leader behavior and power, interper-
sonal communication, group structure and processes, learning, attitude
development and perception, change processes, conflict, work design, and
work stress. 12
Enter Organizational Behavior
3 Define organizational
behavior (OB).
Online shoe retailer Zappos.com
understands how organizational
behavior affects an organization’s
performance. Zappos maintains
good employee relationships by
providing generous benefits, exten-
sive customer service training, and
a positive, fun-loving work environ-
ment. Employees are empowered
to make decisions that increase cus-
tomer satisfaction and are encour-
aged to create fun and a little
weirdness.” At Zappos, employee
loyalty, job satisfaction, and produc-
tivity are high, contributing to the
company’s growth. In this photo,
employees view a line of shoes in
one of the company’s quirky offices.
So
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Complementing Intuition with Systematic Study 11
organizational behavior (OB) A field
of study that investigates the impact
that individuals, groups, and structure
have on behavior within organizations,
for the purpose of applying such
knowledge toward improving an
organization’s effectiveness.
systematic study Looking at
relationships, attempting to attribute
causes and effects, and drawing
conclusions based on scientific
evidence.
evidence-based management
(EBM) The basing of managerial
decisions on the best available
scientific evidence.
intuition A gut feeling not necessarily
supported by research.
Each of us is a student of behavior. Whether you’ve explicitly thought about it
before, you’ve been “reading” people almost all your life, watching their actions
and trying to interpret what you see or predict what people might do under
different conditions. Unfortunately, the casual or common sense approach to
reading others can often lead to erroneous predictions. However, you can im-
prove your predictive ability by supplementing intuition with a more systematic
approach.
The systematic approach in this book will uncover important facts and
relationships and provide a base from which to make more accurate predictions
of behavior. Underlying this systematic approach is the belief that behavior is
not random. Rather, we can identify fundamental consistencies underlying the
behavior of all individuals and modify them to reflect individual differences.
These fundamental consistencies are very important. Why? Because they
allow predictability. Behavior is generally predictable, and the systematic study
of behavior is a means to making reasonably accurate predictions. When we
use the term systematic study , we mean looking at relationships, attempt-
ing to attribute causes and effects, and basing our conclusions on scientific
evidence—that is, on data gathered under controlled conditions and mea-
sured and interpreted in a reasonably rigorous manner. (See Appendix A for
a basic review of research methods used in studies of organizational behavior.)
Evidence-based management (EBM) complements systematic study by bas-
ing managerial decisions on the best available scientific evidence. For example,
we want doctors to make decisions about patient care based on the latest avail-
able evidence, and EBM argues that managers should do the same, becoming
more scientific in how they think about management problems. A manager
might pose a managerial question, search for the best available evidence, and
apply the relevant information to the question or case at hand. You might think
it difficult to argue against this (what manager would say decisions shouldn’t
be based on evidence?), but the vast majority of management decisions are still
made “on the fly,” with little or systematic study of available evidence. 13
Systematic study and EBM add to intuition , or those “gut feelings” about
what makes others (and ourselves) “tick.” Of course, the things you have come
to believe in an unsystematic way are not necessarily incorrect. Jack Welch (for-
mer CEO of GE) noted, “The trick, of course, is to know when to go with your
gut.” But if we make all decisions with intuition or gut instinct, we’re likely
working with incomplete information—like making an investment decision
with only half the data.
Relying on intuition is made worse because we tend to overestimate the
accuracy of what we think we know. In a recent survey, 86 percent of managers
thought their organization was treating their employees well, but only 55 percent
of the employees thought so. Surveys of human resource managers have also
Complementing Intuition with Systematic Study
4 Show the value to OB
of systematic study.

12 CHAPTER 1 What Is Organizational Behavior?
T
his statement is true in the broad
sense that most research in-
dicates men are more likely to
engage in workplace bullying, and
women are more likely to be targets of
bullying behavior.
However, the full picture of gender
and workplace bullying is more compli-
cated than that.
First, the gender differences are nar-
rowing. A recent study of workplace
bullying by the Workplace Bullying
Institute (WBI) suggested that 60 per-
cent of workplace bullies are men and
40 percent are women. That is still a sig-
nificant gender difference. But it is not
as large as was once the case. Some of
the narrowing in the gender of bullies
is due to the ascension of women up
their organizations’ ladders. Evidence
indicates that the vast majority of inci-
dents of workplace bullying are “top-
down”: the supervisor is intimidating
the subordinate. As more women are
becoming supervisors, this is changing,
to some degree, the gender balance of
workplace bullies.
A second complication is that when
women bully others at work, other
women are overwhelmingly their tar-
gets. The same WBI study of work-
place bullying revealed that 58 percent
of victims of bullying are women.
However, almost all of this gender dif-
ference in victims is due to who women
bullies target; in 80 percent of the cases,
it was other women. Male bullies are ac-
tually more likely to target their own sex,
though to a less dramatic degree than
female bullies do.
Finally, it does appear that women
are more adversely affected by bullying.
A recent study of 183 victims of bully-
ing found that the prevalence of trauma
was higher for women (49 percent)
than men (35 percent). The complexity
of these relationships shows us that
gaining a true understanding of orga-
nizational behavior phenomena often
means understanding that the causes
and consequences of work behavior are
complex.
Back to bullying, experts suggest
some ways to cope with workplace
bullies regardless of your sex.
1. Talk to your bully. “Perhaps your
boss is one of those people who
aren’t aware of how they come
across,” says Stanford’s Robert
Sutton, author of several books on
bullying in the workplace.
2. Get help. Keep a diary of the behav-
ior. Be specific and focus more on
actions than feelings. At some point,
it might be necessary to involve
others, such as human resources.
3. Ignore it. This is often easier said
than done, but sometimes the only
thing you can do is to try to ignore
the bully. “Try not to let it touch
your soul,” says Sutton.
4. Polish your résumé. Bullies some-
times go away, and sometimes
they listen. But if they aren’t going
to change and aren’t going away,
you may want to plan your exit
strategy. Take your time and don’t
panic. But not every workplace is
filled with bullies, and you’ll likely
be happier if you’re in one of those.
Source: L. Petrecca, “Bullying in Workplace
Is Common, Hard to Fix,” USA Today (De-
c ember 28, 2010), pp. 1B–2B; R. I. Sutton,
Good Boss, Bad Boss: How to Be the
Best … and Learn from the Worst (New
York: Business Plus, 2010); A. Rodríguez-
Muñoz, B. Moreno-Jiménez, A. Vergel, and
E. G. Hernández, “Post-Traumatic Symptoms
Among Victims of Workplace Bullying:
Exploring Gender Differences and Shattered
Assumptions,” Journal of Applied Social
Psychology 40, no. 10 (2010), pp. 2616–2635.
Myth or Science?
“Most Acts of Workplace Bullying
Are Men Attacking Women”
shown many managers hold “common sense” opinions regarding effective man-
agement that have been flatly refuted by empirical evidence.
We find a similar problem in chasing the business and popular media for
management wisdom. The business press tends to be dominated by fads. As a
writer for The New Yorker put it, “Every few years, new companies succeed, and
they are scrutinized for the underlying truths they might reveal. But often there
is no underlying truth; the companies just happened to be in the right place at
the right time.” 14 Although we try to avoid it, we might also fall into this trap.
It’s not that the business press stories are all wrong; it’s that without a systematic
approach, it’s hard to separate the wheat from the chaff.
We’re not advising that you throw your intuition, or all the business
press, out the window. Nor are we arguing that research is always right.

Disciplines That Contribute to the OB Field 13
Organizational behavior is an applied behavioral science built on contributions
from a number of behavioral disciplines, mainly psychology and social psychol-
ogy, sociology, and anthropology. Psychology’s contributions have been mainly
at the individual or micro level of analysis, while the other disciplines have con-
tributed to our understanding of macro concepts such as group processes and
organization. Exhibit 1-3 is an overview of the major contributions to the study of
organizational behavior.
Disciplines That Contribute to the OB Field
5 Identify the major behav-
ioral science disciplines that
contribute to OB.
Sociology
Social psychology
Anthropology
Psychology
Behavioral
science
OutputUnit of
analysis
Contribution
Learning
Motivation
Personality
Emotions
Perception
Training
Leadership effectiveness
Job satisfaction
Individual decision making
Performance appraisal
Attitude measurement
Employee selection
Work design
Work stress
Behavioral change
Attitude change
Communication
Group processes
Group decision making
Formal organization theory
Organizational technology
Organizational change
Organizational culture
Comparative values
Comparative attitudes
Cross-cultural analysis
Organizational culture
Organizational environment
Power
Communication
Power
Conflict
Intergroup behavior
Study of
organizational
behavior
Organization
system
Individual
Group
Toward an OB Discipline Exhibit 1-3
Researchers make mistakes, too. What we are advising is to use evidence
as much as possible to inform your intuition and experience. That is the
promise of OB.

14 CHAPTER 1 What Is Organizational Behavior?
Psychology
Psychology seeks to measure, explain, and sometimes change the behavior of
humans and other animals. Those who have contributed and continue to add
to the knowledge of OB are learning theorists, personality theorists, counseling
psychologists, and, most important, industrial and organizational psychologists.
Early industrial/organizational psychologists studied the problems of
fatigue, boredom, and other working conditions that could impede effi-
cient work performance. More recently, their contributions have expanded
to include learning, perception, personality, emotions, training, leadership
effectiveness, needs and motivational forces, job satisfaction, decision-making
processes, performance appraisals, attitude measurement, employee-selection
techniques, work design, and job stress.
Social Psychology
Social psychology , generally considered a branch of psychology, blends con-
cepts from both psychology and sociology to focus on peoples’ influence on
one another. One major study area is change —how to implement it and how to
reduce barriers to its acceptance. Social psychologists also contribute to mea-
suring, understanding, and changing attitudes; identifying communication pat-
terns; and building trust. Finally, they have made important contributions to
our study of group behavior, power, and conflict.
Sociology
While psychology focuses on the individual, sociology studies people in rela-
tion to their social environment or culture. Sociologists have contributed to OB
through their study of group behavior in organizations, particularly formal and
complex organizations. Perhaps most important, sociologists have studied or-
ganizational culture, formal organization theory and structure, organizational
technology, communications, power, and conflict.
Anthropology
Anthropology is the study of societies to learn about human beings and their
activities. Anthropologists’ work on cultures and environments has helped us
understand differences in fundamental values, attitudes, and behavior between
people in different countries and within different organizations. Much of our
current understanding of organizational culture, organizational environments,
and differences among national cultures is a result of the work of anthropolo-
gists or those using their methods.

Laws in the physical sciences—chemistry, astronomy, physics—are consistent and
apply in a wide range of situations. They allow scientists to generalize about the
pull of gravity or to be confident about sending astronauts into space to repair
satellites. But as a noted behavioral researcher observed, “God gave all the easy
problems to the physicists.” Human beings are complex, and few, if any, simple
and universal principles explain organizational behavior. Because we are not
alike, our ability to make simple, accurate, and sweeping generalizations is limited.
There Are Few Absolutes in OB
6 Demonstrate why few
absolutes apply to OB.

Challenges and Oppor tunities for OB 15
Two people often act very differently in the same situation, and the same person’s
behavior changes in different situations. Not everyone is motivated by money, and
people may behave differently at a religious service than they do at a party.
That doesn’t mean, of course, that we can’t offer reasonably accurate ex-
planations of human behavior or make valid predictions. It does mean that
OB concepts must reflect situational, or contingency, conditions. We can say x
leads to y, but only under conditions specified in z —the contingency variables .
The science of OB was developed by applying general concepts to a particular
situation, person, or group. For example, OB scholars would avoid stating that
everyone likes complex and challenging work (the general concept). Why?
Because not everyone wants a challenging job. Some people prefer routine
over varied, or simple over complex. A job attractive to one person may not be
to another; its appeal is contingent on the person who holds it.
As you proceed through this book, you’ll encounter a wealth of research-
based theories about how people behave in organizations. But don’t expect to
find a lot of straightforward cause-and-effect relationships. There aren’t many!
organizational behavior theories mirror the subject matter with which they
deal, and people are complex and complicated.
psychology The science that seeks
to measure, explain, and sometimes
change the behavior of humans and
other animals.
social psychology An area of
psychology that blends concepts
from psychology and sociology and
that focuses on the influence of people
on one another.
sociology The study of people in
relation to their social environment
or culture.
anthropology The study of societies
to learn about human beings and their
activities.
contingency variables Situational
factors: variables that moderate the
relationship between two or more
variables.
Understanding organizational behavior has never been more important for
managers. Take a quick look at the dramatic changes in organizations. The
typical employee is getting older; more women and people of color are in the
workplace; corporate downsizing and the heavy use of temporary workers are
severing the bonds of loyalty that tied many employees to their employers;
global competition requires employees to become more flexible and cope with
rapid change. The global recession has brought to the forefront the challenges
of working with and managing people during uncertain times.
In short, today’s challenges bring opportunities for managers to use OB con-
cepts. In this section, we review some of the most critical issues confronting manag-
ers for which OB offers solutions—or at least meaningful insights toward solutions.
Responding to Economic Pressures
When the U.S. economy plunged into a deep and prolonged recession in 2008,
virtually all other large economies around the world followed suit. Layoffs and
job losses were widespread, and those who survived the ax were often asked to
accept pay cuts.
During difficult economic times, effective management is often at a premium.
Anybody can run a company when business is booming, because the difference
Challenges and Opportunities for OB
7 Identify the challenges and
opportunities managers have
in applying OB concepts.

16 CHAPTER 1 What Is Organizational Behavior?
between good and bad management reflects the difference between making a lot
of money and making a lot more money. When times are bad, though, manag-
ers are on the front lines with employees who must be fired, who are asked to
make do with less, and who worry about their futures. The difference between
good and bad management can be the difference between profit and loss or, ulti-
mately, between survival and failure.
Consider Enterprise Rent-A-Car. The company prided itself on never hav-
ing laid off a U.S. employee in its 51-year history. Even in the 2001–2002 re-
cession after the 9/11 terrorist attacks, Enterprise kept hiring. In 2008–2009,
however, Enterprise was forced to lay off more than a thousand employees.
“These types of declines are unprecedented,” said Patrick Farrell, Enterprise’s
vice president of corporate responsibility. Gentex Corp, a Michigan-based auto
parts supplier, had never had a layoff in its 34-year history—until 2008–2009.
“We didn’t even have a layoff policy,” said Gentex’s vice president of human
resources. 15
Managing employees well when times are tough is just as hard as when times
are good—if not more so. But the OB approaches sometimes differ. In good
times, understanding how to reward, satisfy, and retain employees is at a premium.
In bad times, issues like stress, decision making, and coping come to the fore.
Responding to Globalization
Organizations are no longer constrained by national borders. Burger King
is owned by a British firm, and McDonald’s sells hamburgers in Moscow.
ExxonMobil, a so-called U.S. company, receives almost 75 percent of its revenues
from sales outside the United States. New employees at Finland-based phone
maker Nokia are increasingly being recruited from India, China, and other
developing countries—non-Finns now outnumber Finns at Nokia’s renowned
research center in Helsinki. And all major automobile makers now manufacture
cars outside their borders; Honda builds cars in Ohio, Ford in Brazil, Volkswagen
in Mexico, and both Mercedes and BMW in South Africa.
The world has become a global village. In the process, the manager’s job has
changed.
“Thinking about the job situation in America today, would you say that it is now a
good time or a bad time to find a quality job?”
100
90
80
70
60
50
40
30
20
10
0
Working in Good Times—and BadOB Poll
57 59 54
48
47
26
20
8 11
69
86 89 86
39 38 41
2004 2005 2006 2007 2008 2009 2010 2011
Bad
Good

Source: Gallup tracking polls of random samples of roughly 1,000 adults, aged 18 and older, living in the continental U.S., selected using
random-digit telephone sampling. See F. Newport, “Americans’ Views of Job Market Improve; Still Mostly Negative” (April 18, 2011),
www.gallup.com .

www.gallup.com

Challenges and Oppor tunities for OB 17
Increased Foreign Assignments If you’re a manager, you are increasingly
likely to find yourself in a foreign assignment—transferred to your employer’s
operating division or subsidiary in another country. Once there, you’ll have
to manage a workforce very different in needs, aspirations, and attitudes from
those you are used to back home.
Working with People from Different Cultures Even in your own country,
you’ll find yourself working with bosses, peers, and other employees born and
raised in different cultures. What motivates you may not motivate them. Or
your communication style may be straightforward and open, which others may
find uncomfortable and threatening. To work effectively with people from dif-
ferent cultures, you need to understand how their culture, geography, and re-
ligion have shaped them and how to adapt your management style to their
differences.
Managers at global companies such as McDonald’s, Disney, and Coca-Cola
have come to realize that economic values are not universally transferable.
Management practices need to be modified to reflect the values of the different
countries in which an organization operates.
Overseeing Movement of Jobs to Countries with Low-Cost Labor It’s increas-
ingly difficult for managers in advanced nations, where minimum wages are
typically $6 or more an hour, to compete against firms that rely on workers
from China and other developing nations where labor is available for 30 cents
an hour. It’s not by chance that many in the United States wear clothes made
in China, work on computers whose microchips came from Taiwan, and watch
movies filmed in Canada. In a global economy, jobs tend to flow where lower
costs give businesses a comparative advantage, though labor groups, politicians,
and local community leaders see the exporting of jobs as undermining the job
market at home. Managers face the difficult task of balancing the interests of
their organization with their responsibilities to the communities in which they
operate.
In the global economy, jobs tend
to shift from developed nations to
countries where lower labor costs
give firms a comparative advan-
tage. In this photo, an employee
wearing a sign on his head reading
“Capital Interests” joins co-workers
at a Nokia factory in Germany
to protest the company’s deci-
sion of terminating mobile phone
production at the plant, resulting
in the loss of 2,300 jobs. Nokia
announced plans to shift produc-
tion from Germany to Romania,
where labor costs are lower.
So
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K
a
is
e
r/
G
e
tt
y
Im
a
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e
s

18 CHAPTER 1 What Is Organizational Behavior?
Managing Workforce Diversity
One of the most important challenges for organizations is adapting to people
who are different. We describe this challenge as workforce diversity. Whereas glo-
balization focuses on differences among people from different countries, work-
force diversity addresses differences among people within given countries.
Workforce diversity acknowledges a workforce of women and men; many ra-
cial and ethnic groups; individuals with a variety of physical or psychological abili-
ties; and people who differ in age and sexual orientation. Managing this diversity
is a global concern. Most European countries have experienced dramatic growth
in immigration from the Middle East, Argentina and Venezuela host a significant
number of migrants from other South American countries, and nations from
India to Iraq to Indonesia find great cultural diversity within their borders.
The most significant change in the U.S. labor force during the last half of
the twentieth century was the rapid increase in the number of female workers.
In 1950, for instance, only 29.6 percent of the workforce was female. By 2008,
it was 46.5 percent. The first half of the twenty-first century will be notable for
changes in racial and ethnic composition and an aging baby boom genera-
tion. By 2050, Hispanics will grow from today’s 11 percent of the workforce
to 24 percent, blacks will increase from 12 to 14 percent, and Asians from
5 to 11 percent. Meanwhile, in the near term the labor force will be aging.
The 55-and-older age group, currently 13 percent of the labor force, will in-
crease to 20 percent by 2014.
Though we have more to say about workforce diversity in the next chapter,
suffice it to say here that it presents great opportunities and poses challenging
questions for managers and employees in all countries. How can we leverage
differences within groups for competitive advantage? Should we treat all employ-
ees alike? Should we recognize individual and cultural differences? How can we
foster cultural awareness in employees without lapsing into political correctness?
What are the legal requirements in each country? Does diversity even matter?
Improving Customer Service
American Express recently turned Joan Weinbel’s worst nightmare into a non-
event. It was 10:00 p.m. Joan was home in New Jersey, packing for a weeklong
trip, when she suddenly realized she had left her AmEx Gold card at a restau-
rant in New York City earlier in the evening. The restaurant was 30 miles away.
She had a flight to catch at 7:30 the next morning, and she wanted her card
for the trip. She called American Express. The phone was quickly answered
by a courteous and helpful AmEx customer service representative who told
Ms. Weinbel not to worry. He asked her a few questions and told her, “Help is
on the way.” To say Joan was flabbergasted when her doorbell rang at 11:45 p.m.
is an understatement—it was less than 2 hours after her call. At the door was a
courier with a new card. How the company was able to produce the card and
get it to her so quickly still puzzles Joan, but she said the experience made her
a customer for life.
Today, the majority of employees in developed countries work in service
jobs, including 80 percent in the United States. In Australia, 73 percent work
in service industries. In the United Kingdom, Germany, and Japan, the per-
centages are 69, 68, and 65, respectively. Service jobs include technical sup-
port representatives, fast-food counter workers, sales clerks, waiters and
waitresses, nurses, automobile repair technicians, consultants, credit represen-
tatives, financial planners, and flight attendants. The common characteristic
of these jobs is substantial interaction with an organization’s customers. And
because an organization can’t exist without customers—whether it is American

Challenges and Oppor tunities for OB 19
Express, L. L. Bean, a law firm, a museum, a school, or a government agency—
management needs to ensure employees do what it takes to please customers. 16
At Patagonia—a retail outfitter for climbers, mountain bikers, skiers and board-
ers, and other outdoor fanatics—customer service is the store manager’s most
important general responsibility: “Instill in your employees the meaning and
importance of customer service as outlined in the retail philosophy, ‘Our store
is a place where the word “no” does not exist’; empower staff to ‘use their
best judgment’ in all customer service matters.” 17 OB can help managers at
Patagonia achieve this goal and, more generally, can contribute to improving
an organization’s performance by showing managers how employee attitudes
and behavior are associated with customer satisfaction.
Many an organization has failed because its employees failed to please custom-
ers. Management needs to create a customer-responsive culture. OB can provide
considerable guidance in helping managers create such cultures—in which em-
ployees are friendly and courteous, accessible, knowledgeable, prompt in respond-
ing to customer needs, and willing to do what’s necessary to please the customer. 18
Improving People Skills
As you proceed through the chapters of this book, we’ll present relevant con-
cepts and theories that can help you explain and predict the behavior of peo-
ple at work. In addition, you’ll gain insights into specific people skills that you
workforce diversity The concept that
organizations are becoming more
heterogeneous in terms of gender,
age, race, ethnicity, sexual orientation,
and inclusion of other diverse groups.
The Ritz Carlton Hotel Company
is recognized worldwide as the
gold standard of the hospitality
industry. Its motto—“We are ladies
and gentlemen serving ladies and
gentlemen”—is exemplified by
the employee shown here serv-
ing a guest on the summer terrace
of the Ritz-Carlton Moscow. The
Ritz-Carlton’s customer-responsive
culture, which is articulated in
the company’s motto, credo, and
service values, is designed to build
strong relationships that create
guests for life.
So
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rc
e
: I
T
A
R
–
T
A
SS
/
A
n
to
n
T
u
sh
in
/
N
e
w
sc
o
m

20 CHAPTER 1 What Is Organizational Behavior?
can use on the job. For instance, you’ll learn ways to design motivating jobs,
techniques for improving your listening skills, and how to create more effec-
tive teams.
Stimulating Innovation and Change
Whatever happened to Montgomery Ward, Woolworth, Smith Corona, TWA,
Bethlehem Steel, and WorldCom? All these giants went bust. Why have other
giants, such as General Motors, Sears, Boeing, and Lucent Technologies, im-
plemented huge cost-cutting programs and eliminated thousands of jobs? The
answer is to avoid going broke.
Today’s successful organizations must foster innovation and master the art
of change, or they’ll become candidates for extinction. Victory will go to the
organizations that maintain their flexibility, continually improve their quality,
and beat their competition to the marketplace with a constant stream of inno-
vative products and services. Domino’s single-handedly brought on the demise
of small pizza parlors whose managers thought they could continue doing what
they had been doing for years. Amazon.com is putting a lot of independent
bookstores out of business as it proves you can successfully sell books (and most
anything else) from a Web site. After years of lackluster performance, Boeing re-
alized it needed to change its business model. The result was its 787 Dreamliner
and a return to being the world’s largest airplane manufacturer.
An organization’s employees can be the impetus for innovation and change,
or they can be a major stumbling block. The challenge for managers is to stimu-
late their employees’ creativity and tolerance for change. The field of OB pro-
vides a wealth of ideas and techniques to aid in realizing these goals.
Coping with “Temporariness”
Globalization, expanded capacity, and advances in technology have required orga-
nizations to be fast and flexible if they are to survive. The result is that most manag-
ers and employees today work in a climate best characterized as “temporary.”
Workers must continually update their knowledge and skills to perform new
job requirements. Production employees at companies such as Caterpillar, Ford,
and Alcoa now need to operate computerized production equipment. That
was not part of their job descriptions 20 years ago. In the past, employees were
assigned to a specific work group, gaining a considerable amount of security
working with the same people day in and day out. That predictability has been
replaced by temporary work groups, with members from different departments,
and the increased use of employee rotation to fill constantly changing work as-
signments. Finally, organizations themselves are in a state of flux. They contin-
ually reorganize their various divisions, sell off poorly performing businesses,
downsize operations, subcontract noncritical services and operations to other
organizations, and replace permanent employees with temporary workers.
Today’s managers and employees must learn to cope with temporariness,
flexibility, spontaneity, and unpredictability. The study of OB can help you
better understand a work world of continual change, overcome resistance to
change, and create an organizational culture that thrives on change.
Working in Networked Organizations
Networked organizations allow people to communicate and work together
even though they may be thousands of miles apart. Independent contractors
can telecommute via computer to workplaces around the globe and change
employers as the demand for their services changes. Software programmers,
graphic designers, systems analysts, technical writers, photo researchers, book

Challenges and Oppor tunities for OB 21
and media editors, and medical transcribers are just a few examples of people
who can work from home or other nonoffice locations.
The manager’s job is different in a networked organization. Motivating and
leading people and making collaborative decisions online requires different
techniques than when individuals are physically present in a single location. As
more employees do their jobs by linking to others through networks, managers
must develop new skills. OB can provide valuable insights to help with honing
those skills.
Helping Employees Balance Work–Life Conflicts
The typical employee in the 1960s or 1970s showed up at a specified workplace
Monday through Friday and worked for clearly defined 8- or 9-hour chunks of
time. That’s no longer true for a large segment of today’s workforce. Employees
are increasingly complaining that the line between work and nonwork time
has become blurred, creating personal conflicts and stress. 19 At the same time,
today’s workplace presents opportunities for workers to create and structure
their own roles.
How do work–life conflicts come about? First, the creation of global orga-
nizations means the world never sleeps. At any time on any day, thousands of
General Electric employees are working somewhere. The need to consult with
colleagues or customers eight or ten time zones away means many employees of
global firms are “on call” 24 hours a day. Second, communication technology
allows many technical and professional employees to do their work at home,
in their cars, or on the beach in Tahiti—but it also means many feel like they
never really get away from the office. Third, organizations are asking employees
to put in longer hours. Over a recent 10-year period, the average U.S. workweek
increased from 43 to 47 hours; and the number of people working 50 or more
hours a week jumped from 24 to 37 percent. Finally, the rise of the dual-career
couple makes it difficult for married employees to find time to fulfill commit-
ments to home, spouse, children, parents, and friends. Millions of single-parent
households and employees with dependent parents have even more significant
challenges in balancing work and family responsibilities.
Dr. Orit Wimpfheimer performs her
job by linking to others through
networks. Shown here at her home
office near Jerusalem, Israel, she
is a radiologist who analyzes test
results from hospitals in the United
States over the Internet. Networked
organizations that use e-mail, the
Internet, and video-conferencing
allow Dr. Orit Wimpfheimer and
other telecommuters to commu-
nicate and work together even
though they are thousands of miles
apart. The manager’s job in a net-
worked organization requires dif-
ferent techniques from those used
when workers are physically pres-
ent in a single location.
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P
h
o
to
/E
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il
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tt
i

22 CHAPTER 1 What Is Organizational Behavior?
Employees increasingly recognize that work infringes on their personal
lives, and they’re not happy about it. Recent studies suggest employees want
jobs that give them flexibility in their work schedules so they can better manage
work–life conflicts. 20 In fact, balancing work and life demands now surpasses job
security as an employee priority. 21 The next generation of employees is likely to
show similar concerns. 22 Most college and university students say attaining a bal-
ance between personal life and work is a primary career goal; they want “a life”
as well as a job. Organizations that don’t help their people achieve work–life
balance will find it increasingly difficult to attract and retain the most capable
and motivated employees.
As you’ll see in later chapters, the field of OB offers a number of suggestions
to guide managers in designing workplaces and jobs that can help employees
deal with work–life conflicts.
Creating a Positive Work Environment
Although competitive pressures on most organizations are stronger than ever,
some organizations are trying to realize a competitive advantage by fostering a
positive work environment. Jeff Immelt and Jim McNerney, both disciples of
Jack Welch, have tried to maintain high-performance expectations (a charac-
teristic of GE’s culture) while fostering a positive work environment in their
organizations (GE and Boeing). “In this time of turmoil and cynicism about
business, you need to be passionate, positive leaders,” Mr. Immelt recently told
his top managers.
A real growth area in OB research is positive organizational scholarship
(also called positive organizational behavior ), which studies how organizations
develop human strengths, foster vitality and resilience, and unlock potential.
Researchers in this area say too much of OB research and management prac-
tice has been targeted toward identifying what’s wrong with organizations and
their employees. In response, they try to study what’s good about them. 23 Some
key independent variables in positive OB research are engagement, hope, opti-
mism, and resilience in the face of strain.
Positive organizational scholars have studied a concept called “reflected
best-self”—asking employees to think about when they were at their “personal
best” in order to understand how to exploit their strengths. The idea is that
we all have things at which we are unusually good, yet too often we focus
on addressing our limitations and too rarely think about how to exploit our
strengths. 24
Although positive organizational scholarship does not deny the value of the
negative (such as critical feedback), it does challenge researchers to look at OB
through a new lens and pushes organizations to exploit employees’ strengths
rather than dwell on their limitations.
Improving Ethical Behavior
In an organizational world characterized by cutbacks, expectations of increas-
ing productivity, and tough competition, it’s not surprising many employees
feel pressured to cut corners, break rules, and engage in other questionable
practices.
Increasingly they face ethical dilemmas and ethical choices , in which they are
required to identify right and wrong conduct. Should they “blow the whistle”
if they uncover illegal activities in their company? Do they follow orders with
which they don’t personally agree? Should they give an inflated performance
evaluation to an employee they like, knowing it could save that employee’s job?
Do they “play politics” to advance their career?

Coming Attractions: Developing an OB Model 23
What constitutes good ethical behavior has never been clearly defined, and,
in recent years, the line differentiating right from wrong has blurred. Employees
see people all around them engaging in unethical practices—elected officials
pad expense accounts or take bribes; corporate executives inflate profits so they
can cash in lucrative stock options; and university administrators look the other
way when winning coaches encourage scholarship athletes to take easy courses.
When caught, these people give excuses such as “Everyone does it” or “You
have to seize every advantage nowadays.” Determining the ethically correct way
to behave is especially difficult in a global economy because different cultures
have different perspectives on certain ethical issues. 25 Fair treatment of employ-
ees in an economic downturn varies considerably across cultures, for instance.
As we’ll see in Chapter 2 , perceptions of religious, ethnic, and gender diversity
differ across countries. Is it any wonder employees are expressing decreased
confidence in management and increasing uncertainty about what is appropri-
ate ethical behavior in their organizations? 26
Managers and their organizations are responding to the problem of unethi-
cal behavior in a number of ways. 27 They’re writing and distributing codes of
ethics to guide employees through ethical dilemmas. They’re offering seminars,
workshops, and other training programs to try to improve ethical behaviors.
They’re providing in-house advisors who can be contacted, in many cases anony-
mously, for assistance in dealing with ethical issues, and they’re creating protec-
tion mechanisms for employees who reveal internal unethical practices.
Today’s manager must create an ethically healthy climate for his or her em-
ployees, where they can do their work productively with minimal ambiguity about
what right and wrong behaviors are. Companies that promote a strong ethical
mission, encourage employees to behave with integrity, and provide strong ethi-
cal leadership can influence employee decisions to behave ethically. 28 In upcom-
ing chapters, we’ll discuss the actions managers can take to create an ethically
healthy climate and help employees sort through ethically ambiguous situations.
We’ll also present ethical-dilemma exercises at the end of each chapter that allow
you to think through ethical issues and assess how you would handle them.
positive organizational scholarship An
area of OB research that concerns how
organizations develop human strength,
foster vitality and resilience, and
unlock potential.
ethical dilemmas and ethical
choices Situations in which
individuals are required to define right
and wrong conduct.
model An abstraction of reality.
A simplified representation of some
real-world phenomenon.
We conclude this chapter by presenting a general model that defines the field
of OB, stakes out its parameters, and identifies inputs, processes, and outcomes.
The result will be “coming attractions” of the topics in the remainder of this book.
An Overview
A model is an abstraction of reality, a simplified representation of some real-
world phenomenon. Exhibit 1-4 presents the skeleton on which we will con-
struct our OB model. It proposes three types of variables (inputs, processes, and
Coming Attractions: Developing an OB Model
8 Compare the three levels
of analysis in this book’s
OB model.

24 CHAPTER 1 What Is Organizational Behavior?
M
istakes happen in business
all the time, but most people
have a powerful motivation
to try to cover up their errors as much
as possible. However, not recognizing
and learning from failures might be the
most dangerous failure of all because
it means the problem is likely to occur
again. This means that, even though
it might be hard to admit it, doing
the right thing often means admitting
when you’ve done the wrong thing.
Most people would say that we have
an ethical obligation to learn from
mistakes, but how can we do that?
In a recent special issue in Harvard
Business Review on failures, experts
argued that learning from mistakes
relies on several strategies, which
include:
1. Heed pressure. High pressure of-
ten provokes faulty thinking. BP
faced enormous pressure from
cost overruns—roughly $1 million
a day—in its deepwater oil explo-
rations. This led its managers to
miss warning signs that led to the
catastrophic explosion in the Gulf
of Mexico in 2010. Similar time
and cost pressures precipitated the
ill-fated Challenger and Columbia
space shuttle launches. In high-
pressure situations, ask yourself,
“If I had more time and resources,
would I make the same decision?”
2. Recognize that failure is not al-
ways bad. Most of us would agree
that we have learned more in life
from our mistakes than from our suc-
cesses. So, we need to realize that
while we don’t want to fail, it does
have a hidden gift if we’re willing to
receive—a chance to learn some-
thing important. Eli Lilly holds “failure
parties” to honor drug trials and ex-
periments that fail to achieve the de-
sired results. The rationale for these
parties is to recognize that when little
is ventured, little is lost, but little is
gained too. Procter & Gamble CEO
A. G. Lafley argues that very high
success rates show incremental
innovation—but what he wants are
game changers. He has celebrated
P&G’s 11 most expensive product
failures, focusing on what the com-
pany learned from each. So don’t be
afraid to admit mistakes—and ask
“What can I learn” from each.
3. Understand and address the root
cause. When Apple introduced the
iPhone 4 in 2010, many customers
complained about dropped calls.
Apple first responded by suggest-
ing the problem lay in the way cus-
tomers held the phones, suggested
they “avoid gripping [the phone] in
the lower left corner.” Steve Jobs
called the problem a “non-issue.”
Only later did Apple address the
root cause of the problem—and fix
it. When you make an error, try to
understand what caused it.
4. Reward owning up. If you make a
mistake, be willing to speak up and
admit it. Too often we dig ourselves
deeper into a hole by being de-
fensive about mistakes. That also
keeps us from learning from our
failures. If we all make mistakes,
what are we being so defensive
about?
Given the complexity of human behav-
ior, we’ll never avoid making mistakes
entirely. Indeed, a healthy appreciation
for how mistake-prone we are is one
of the points of this chapter (and of
Chapter 6 ). But we can do a better job
of admitting our mistakes and learning
from them when they occur.
Sources: A. C. Edmondson, “Strategies
for Learning from Failure,” Harvard Business
Review 89, no. 4 (2011), pp. 48–55;
R. G. Mcgrath, “Failing by Design,”
Harvard Business Review 89, no. 4 (2011),
pp. 76–83; C. H. Tinsley, R. L. Dillon, and
P. M. Madsen, “How to Avoid Catastrophe,”
Harvard Business Review 89, no. 4 (2011),
pp. 90–97.
An Ethical Choice
Can You Learn from Failure?
outcomes) at three levels of analysis (individual, group, and organizational).
The model proceeds from left to right, with inputs leading to processes and
processes leading to outcomes. Notice that the model also shows that outcomes
can influence inputs in the future.
Inputs
Inputs are the variables like personality, group structure, and organizational
culture that lead to processes. These variables set the stage for what will occur
in an organization later. Many are determined in advance of the employment
relationship. For example, individual diversity characteristics, personality, and
values are shaped by a combination of an individual’s genetic inheritance and
childhood environment. Group structure, roles, and team responsibilities are

Coming Attractions: Developing an OB Model 25
typically assigned immediately before or after a group is formed. Finally, organi-
zational structure and culture are usually the result of years of development and
change as the organization adapts to its environment and builds up customs
and norms.
Processes
If inputs are like the nouns in organizational behavior, processes are like verbs.
Processes are actions that individuals, groups, and organizations engage in as
a result of inputs and that lead to certain outcomes. At the individual level,
processes include emotions and moods, motivation, perception, and decision
making. At the group level, they include communication, leadership, power
and politics, and conflict and negotiation. Finally, at the organizational level,
processes include human resource management and change practices.
Outcomes
Outcomes are the key variables that you want to explain or predict, and that
are affected by some other variables. What are the primary outcomes in OB?
Scholars have emphasized individual-level outcomes like attitudes and satisfac-
tion, task performance, citizenship behavior, and withdrawal behavior. At the
group level, cohesion and functioning are the dependent variables. Finally, at
the organizational level we look at overall profitability and survival. Because
these outcomes will be covered in all the chapters, we’ll briefly discuss each
here so you can understand what the “goal” of OB will be.
Processes
Individual Level
• Emotions and moods
• Motivation
• Perception
• Decision making
Group Level
• Communication
• Leadership
• Power and politics
• Conflict and negotiation
Organizational Level
• Human resource
management
• Change practices
Outcomes
Individual Level
• Attitudes and stress
• Task performance
• Citizenship behavior
• Withdrawal behavior
Group Level
• Group cohesion
• Group functioning
Organizational Level
• Productivity
• Survival
Inputs
Individual Level
• Diversity
• Personality
• Values
Group Level
• Group structure
• Group roles
• Team responsibilities
Organizational Level
• Structure
• Culture
A Basic OB Model Exhibit 1-4
input Variables that lead to processes. processes Actions that individuals,
groups, and organizations engage in
as a result of inputs and that lead to
certain outcomes.
outcomes Key factors that are
affected by some other variables.

26 CHAPTER 1 What Is Organizational Behavior?
Attitudes and Stress Employee attitudes are the evaluations employees make,
ranging from positive to negative, about objects, people, or events. For exam-
ple, the statement, “I really think my job is great,” is a positive job attitude, and
“My job is boring and tedious” is a negative job attitude. Stress is an unpleasant
psychological process that occurs in response to environmental pressures.
Some people might think that influencing employee attitudes and stress is
purely soft stuff, and not the business of serious managers, but as we will show,
attitudes often have behavioral consequences that directly relate to organiza-
tional effectiveness. The belief that satisfied employees are more productive
than dissatisfied employees has been a basic tenet among managers for years,
though only now has research begun to support it. Ample evidence shows that
employees who are more satisfied and treated fairly are more willing to engage
in the above-and-beyond citizenship behavior so vital in the contemporary busi-
ness environment. A study of more than 2,500 business units also found that
those scoring in the top 25 percent on the employee opinion survey were, on
average, 4.6 percent above their sales budget for the year, while those scoring in
the bottom 25 percent were 0.8 percent below budget. In real numbers, this was
a difference of $104 million in sales per year between the two groups.
Task Performance The combination of effectiveness and efficiency at doing
your core job tasks is a reflection of your level of task performance . If we think
about the job of a factory worker, task performance could be measured by the
number and quality of products produced in an hour. The task performance of
a teacher would be the level of education that students obtain. The task perfor-
mance of a consultant might be measured by the timeliness and quality of the
presentations they offer to the client firm. All these types of performance relate
to the core duties and responsibilities of a job and are often directly related to
the functions listed on a formal job description.
Obviously task performance is the most important human output contribut-
ing to organizational effectiveness, so in every chapter we devote considerable
time to detailing how task performance is affected by the topic in question.
Task performance is one of the
primary individual-level outcomes
in organizational behavior. For
these women who install wiring in
car doors at the General Motors’
assembly plant in Lordstown, Ohio,
task performance is measured by
the number and quality of the work
they produce. Their level of task
performance is related to the duties
of their job and how effectively and
efficiently they perform them. Task
performance is the most important
human output contributing to orga-
nizational effectiveness.
So
u
rc
e
: A
P
P
h
o
to
/M
a
rk
D
u
n
ca
n

Coming Attractions: Developing an OB Model 27
Citizenship Behavior The discretionary behavior that is not part of an
employee’s formal job requirements, and that contributes to the psychologi-
cal and social environment of the workplace, is called citizenship behavior .
Successful organizations need employees who will do more than their usual job
duties—who will provide performance beyond expectations. In today’s dynamic
workplace, where tasks are increasingly performed by teams and flexibility is
critical, employees who engage in “good citizenship” behaviors help others
on their team, volunteer for extra work, avoid unnecessary conflicts, respect
the spirit as well as the letter of rules and regulations, and gracefully tolerate
occasional work-related impositions and nuisances.
Organizations want and need employees who will do things that aren’t in
any job description. Evidence indicates organizations that have such employees
outperform those that don’t. As a result, OB is concerned with citizenship be-
havior as an outcome variable.
Withdrawal Behavior We’ve already mentioned behavior that goes above and
beyond task requirements, but what about behavior that in some way is below
task requirements? Withdrawal behavior is the set of actions that employees take
to separate themselves from the organization. There are many forms of with-
drawal, ranging from showing up late or failing to attend meetings to absentee-
ism and turnover.
Employee withdrawal can have a very negative effect on an organization.
The cost of employee turnover alone has been estimated to run into the thou-
sands of dollars, even for entry-level positions. Absenteeism also costs organiza-
tions significant amounts of money and time every year. For instance, a recent
survey found the average direct cost to U.S. employers of unscheduled absences
is 8.7 percent of payroll. 29 In Sweden, an average of 10 percent of the country’s
workforce is on sick leave at any given time. 30
It’s obviously difficult for an organization to operate smoothly and attain its
objectives if employees fail to report to their jobs. The work flow is disrupted,
and important decisions may be delayed. In organizations that rely heavily on
assembly-line production, absenteeism can be considerably more than a disrup-
tion; it can drastically reduce the quality of output or even shut down the facility.
Levels of absenteeism beyond the normal range have a direct impact on any orga-
nization’s effectiveness and efficiency. A high rate of turnover can also disrupt the
efficient running of an organization when knowledgeable and experienced per-
sonnel leave and replacements must be found to assume positions of responsibility.
All organizations, of course, have some turnover. The U.S. national turnover
rate averages about 3 percent per month, about a 36 percent turnover per year.
This average varies a lot by occupation, of course; the monthly turnover rate for
government jobs is less than 1 percent, versus 5 to 7 percent in the construc-
tion industry. 31 If the “right” people are leaving the organization—the marginal
and submarginal employees—turnover can actually be positive. It can create an
opportunity to replace an underperforming individual with someone who has
higher skills or motivation, open up increased opportunities for promotions,
task performance The combination of
effectiveness and efficiency at doing
your core job tasks.
citizenship behavior Discretionary
behavior that contributes to the
psychological and social environment
of the workplace.
withdrawal behavior The set of
actions employee take to separate
themselves from the organization.

28 CHAPTER 1 What Is Organizational Behavior?
and bring new and fresh ideas to the organization. 32 In today’s changing world
of work, reasonable levels of employee-initiated turnover improve organiza-
tional flexibility and employee independence, and they can lessen the need for
management-initiated layoffs.
So why do employees withdraw from work? As we will show later in the book,
reasons include negative job attitudes, emotions and moods, and negative inter-
actions with co-workers and supervisors.
Group Cohesion Although many outcomes in our model can be conceptual-
ized as individual level phenomena, some relate to how groups operate. Group
cohesion is the extent to which members of a group support and validate one
another at work. In other words, a cohesive group is one that sticks together.
When employees trust one another, seek common goals, and work together to
achieve these common ends, the group is cohesive; when employees are divided
among themselves in terms of what they want to achieve and have little loyalty to
one another, the group is not cohesive.
There is ample evidence showing that cohesive groups are more effective. 33
These results are found both for groups that are studied in highly controlled
laboratory settings and also for work teams observed in field settings. This fits
with our intuitive sense that people tend to work harder in groups that have
a common purpose. Companies attempt to increase cohesion in a variety of
ways ranging from brief icebreaker sessions to social events like picnics, parties,
and outdoor adventure-team retreats. Throughout the book we will try to assess
whether these specific efforts are likely to result in increases in group cohesive-
ness. We’ll also consider ways that picking the right people to be on the team in
the first place might be an effective way to enhance cohesion.
Group Functioning In the same way that positive job attitudes can be associ-
ated with higher levels of task performance, group cohesion should lead to posi-
tive group functioning. Group functioning refers to the quantity and quality of
a group’s work output. In the same way that the performance of a sports team
is more than the sum of individual players’ performance, group functioning in
work organizations is more than the sum of individual task performances.
What does it mean to say that a group is functioning effectively? In some
organizations, an effective group is one that stays focused on a core task and
achieves its ends as specified. Other organizations look for teams that are able
to work together collaboratively to provide excellent customer service. Still
others put more of a premium on group creativity and the flexibility to adapt to
changing situations. In each case, different types of activities will be required to
get the most from the team.
Productivity The highest level of analysis in organizational behavior is the or-
ganization as a whole. An organization is productive if it achieves its goals by
transforming inputs into outputs at the lowest cost. Thus productivity requires
both effectiveness and efficiency .
A hospital is effective when it successfully meets the needs of its clientele. It is effi-
cient when it can do so at a low cost. If a hospital manages to achieve higher output
from its present staff by reducing the average number of days a patient is confined
to bed or increasing the number of staff–patient contacts per day, we say the hos-
pital has gained productive efficiency. A business firm is effective when it attains
its sales or market share goals, but its productivity also depends on achieving those
goals efficiently. Popular measures of organizational efficiency include return on
investment, profit per dollar of sales, and output per hour of labor.
Service organizations must include customer needs and requirements in as-
sessing their effectiveness. Why? Because a clear chain of cause and effect runs

Coming Attractions: Developing an OB Model 29
from employee attitudes and behavior to customer attitudes and behavior to a
service organization’s productivity. Sears has carefully documented this chain. 34
The company’s management found that a 5 percent improvement in employee
attitudes leads to a 1.3 percent increase in customer satisfaction, which in turn
translates into a 0.5 percent improvement in revenue growth. By training em-
ployees to improve the employee–customer interaction, Sears was able to im-
prove customer satisfaction by 4 percent over a 12-month period, generating an
estimated $200 million in additional revenues.
Survival The final outcome we will consider is organizational survival , which
is simply evidence that the organization is able to exist and grow over the long
term. The survival of an organization depends not just on how productive the
organization is, but also on how well it fits with its environment. A company
that is very productively making goods and services of little value to the mar-
ket is unlikely to survive for long, so survival factors in things like perceiving
the market successfully, making good decisions about how and when to pursue
opportunities, and engaging in successful change management to adapt to new
business conditions.
Having reviewed the input, process, and outcome model, we’re going to
change the figure up a little bit by grouping topics together based on whether we
study them at the individual, group, or organizational level. As you can seen in
Exhibit 1-5 , we will deal with inputs, processes, and outcomes at all three levels of
group cohesion The extent to which
members of a group support and
validate one another while at work.
group functioning The quantity and
quality of a work group’s output.
productivity The combination of the
effectiveness and efficiency of an
organization.
effectiveness The degree to which
an organization meets the needs of its
clientele or customers.
efficiency The degree to which an
organization can achieve its ends at a
low cost.
organizational survival The degree to
which an organization is able to exist
and grow over the long term.
The Group
Inputs
• Group structures
(Ch. 9 & 10)
• Group roles (Ch. 9 & 10)
• Team responsibilities
(Ch. 9 & 10)
Processes
• Communication (Ch. 11)
• Leadership (Ch. 12)
• Power and polities (Ch. 13)
• Conflict and negotiation
(Ch. 14)
Outcomes
• Group collesion
(Ch. 9 & 10)
• Group functioning
(Ch. 9 & 10)
The Organization
Inputs
• Structure (Ch. 15)
• Culture (Ch. 16)
Processes
• Human resource
management (Ch. 17)
• Change practices
(Ch. 18)
Outcomes
• Profitability
(Ch. 16 & 17)
• Survival
(Ch. 16 & 17)
The Individual
Inputs
• Diversity in Organizations
(ch.2)
• Personality and Values
(ch. 5)
Processes
• Emotions and moods (ch. 4)
• Motivation (Ch. 7 and 8)
• Perception and decision
making (Ch. 6)
Outcomes
• Attitudes (ch. 3) & stress
(ch. 18)
• Task performance (all)
• Citizenship behavior (all)
• Withdrawal behavior (all)
The Plan of the Book Exhibit 1-5

30 CHAPTER 1 What Is Organizational Behavior?
analysis, but we group the chapters as shown here to correspond with the typical
ways that research has been done in these areas. It is easier to understand one
unified presentation about how personality leads to motivation which leads to
performance, than to jump around levels of analysis. Because each level builds
on the one that precedes it, after going through them in sequence you will have
a good idea of how the human side of organizations functions.
C
ompanies that operate in more
than one country face a challeng-
ing dilemma: how much should
they tailor organizational practices like
leadership style, rewards, and commu-
nication to each country’s culture? To
some extent, it is necessary to change
the way a company does business
because of differences in regulations,
institutions, and labor force character-
istics. For example, a U.S. company
that operates in Germany will have to
contend with laws requiring greater
worker participation in decision
making, and an Australian company
operating in China will have to match
the knowledge and skills found in
the Chinese workforce. Despite
certain limitations imposed by law
and situational factors, managers still
need to make many decisions about
adjusting their organizational culture to
match the culture of the countries in
which they operate.
There are no simple responses
to this dilemma. Some researchers
propose that managers need to make
a concerted effort to adapt their orga-
nizational culture to match the culture
of the countries in which they operate.
These authors note that within any
country, there is a great deal of simi-
larity in management practices that is
likely the result of culture or values.
If a country’s basic outlook is highly
individualistic, then organizational cul-
ture should also emphasize individual
contributions and efforts. Conversely,
if national culture values collectivism,
then organizational culture should
emphasize group contributions and
cohesiveness. From this perspective,
successful international management
is all about tailoring management prac-
tices and values to fit with the cultural
values of each country in which the
company operates.
On the other hand, some propose
that national culture should not, and
does not, make much difference in
shaping organizational culture. These
researchers note that even within a
single country, there can be a great
deal of variation in values and norms.
The development of practices to match
a culture is fraught with problems of
stereotyping and over-generalizing
about the degree to which everyone
in a given country shares the same
values. These authors also note that
in tailoring practices to each country, a
firm loses the potential value of having
a unifying organizational culture. From
this perspective, companies should try
as much as possible to create a strong
culture that operates across borders to
create a unified global workforce.
Sources: Based on B. Gerhart, “How
Much Does National Culture Constrain
Organizational Culture,” Management
and Organization Review 5, no. 2 (2009),
pp. 241–259; A. S. Tsui, S. S. Nifadkar,
and A. Y. Ou, “Cross-national, Cross-
cultural Organizational Behavior Research:
Advances, Gaps, and Recommendations,”
Journal of Management 33, no. 3 (2007),
pp. 426-478; G. Johns, “The Essential
Impact of Context on Organizational
Behavior,” Academy of Management
Review 31, no. 2 (2006), pp. 386–408.
glOBalization!
Does National Culture Affect Organizational Practices?
Managers need to develop their interpersonal, or people, skills to be effec-
tive in their jobs. Organizational behavior (OB) investigates the impact that
individuals, groups, and structure have on behavior within an organization,
and it applies that knowledge to make organizations work more effectively.
Specifically, OB focuses on how to improve productivity; reduce absenteeism,
Summary and Implications for Managers

Summar y and Implications for Managers 31
Lost in Translation?
POINT COUNTERPOINT
O
rganizations are always looking for leaders, and man-
agers and manager-wannabes are continually looking
for ways to hone their leadership skills. Publishers re-
spond to this demand by offering hundreds of titles that prom-
ise insights into managing people. Books like these can provide
people with the secrets to management that others know about.
Moreover, isn’t it better to learn about management from people
in the trenches, as opposed to the latest esoteric musings from
the “Ivory Tower”? Many of the most important insights we gain
from life aren’t necessarily the product of careful empirical re-
search studies.
It is true there are some bad books out there. But do they
outnumber the esoteric research studies published every year?
For example, a couple of recent management and organiza-
tional behavior studies were published in 2011 with the follow-
ing titles:
● Training for Fostering Knowledge Co-Construction from
Collaborative Inference-Drawing
● The Factor Structure and Cross-Test Convergence of the
Mayer–Salovey–Caruso Model of Emotional Intelligence
● Refining Value-Based Differentiation in Business Relationships:
A Study of the Higher Order Relationship Building Blocks that
Influence Behavioural Intentions
● A Dialogical Approach to the Creation of New Knowledge in
Organizations
We don’t mean to poke fun at these studies. Rather, our point is
that you can’t judge a book by its cover any more than you can a
research study by its title.
There is no one right way to learn the science and art of
managing people in organizations. The most enlightened man-
agers are those who gather insights from multiple sources: their
own experience, research findings, observations of others,
and, yes, business press books, too. If great management were
produced by carefully gleaning results from research studies,
academicians would make the best managers. How often do we
see that?
Research and academics have an important role to play in
understanding effective management. But it isn’t fair to con-
demn all business books by citing the worst (or, at least, the
worse-sounding ones).
W
alk into your nearest major bookstore. You’ll undoubt-
edly find a large selection of books devoted to manage-
ment and managing. Consider the following recent titles:
● Tough Cookies: What 100 Years of the Girl Scouts Can Teach
You (Wiley, 2011)
● From Wags to Riches: How Dogs Teach Us to Succeed in
Business & Life (BenBella Books, 2011)
● All I Know About Management I Learned from My Dog:
The Real Story of Angel, a Rescued Golden Retriever,
Who Inspired the New Four Golden Rules of Management
(Skyhorse Publishing, 2011)
● Mother Teresa, CEO: Unexpected Principles for Practical
Leadership (Berrett-Koehler Publishers, 2011)
● Polar Bear Pirates and Their Quest to Engage the
Sleepwalkers: Motivate Everyday People to Deliver
Extraordinary Results (Capstone, 2011)
● Winnie-the-Pooh on Management: In Which a Very
Important Bear and His Friends Are Introduced to a Very
Important Subject (Penguin, 2011)
● Chicken Lips, Wheeler-Dealer, and the Beady-Eyed M.B.A.:
An Entrepreneurs Wild Adventures on the New Silk Road
(Wiley, 2011)
● Bodybuilders in Tutus: and 35 Other Obscure Business-
Boosting Observations (Robinwood Press, 2011)
● I’ll Make You an Offer You Can’t Refuse: Insider Business
Tips from a Former Mob Boss (Thomas Nelson, 2011)
● The Art of War from SmarterComics: How to be Successful
in Any Competition (Writers of The Round Table Press, 2011)
Popular books on organizational behavior often have cute
titles and are fun to read, but they make the job of managing
people seem much simpler than it is. Most are based on the
author’s opinions rather than substantive research, and it is
doubtful that one person’s experience translates into effective
management practice for everyone. Why do we waste our time
on “fluff” when, with a little effort, we can access knowledge
produced from thousands of scientific studies on human behav-
ior in organizations?
Organizational behavior is a complex subject. Few, if any,
simple statements about human behavior are generalizable to
all people in all situations. Should you really try to apply lead-
ership insights you got from a book about Geronimo or Tony
Soprano to managing software engineers in the twenty-first
century?

32 CHAPTER 1 What Is Organizational Behavior?
1 What is the importance of interpersonal skills?
2 What do managers do in terms of functions, roles,
and skills?
3 What is organizational behavior (OB)?
4 Why is it important to complement intuition with
systematic study?
5 What are the major behavioral science disciplines that
contribute to OB?
6 Why are there few absolutes in OB?
7 What are the challenges and opportunities for
managers in using OB concepts?
8 What are the three levels of analysis in this book’s
OB model?
QUESTIONS FOR REVIEW
EXPERIENTIAL EXERCISE Workforce Diversity
Purpose
To learn about the different needs of a diverse workforce.
Time Required
Approximately 40 minutes.
Participants and Roles
Divide the class into six groups of approximately equal
size. Assign each group one of the following roles:
Nancy is 28 years old. The divorced mother of three
children ages 3, 5, and 7, she is the department head.
She earns $40,000 per year at her job and receives
another $3,600 per year in child support from her
ex-husband.
Ethel is a 72-year-old widow. She works 25 hours
per week at an hourly wage of $8.50 to supplement
her $8,000 annual pension and earns a total of
$19,000 per year.
John is a 34-year-old born in Trinidad who is now a
U.S. resident. He is married and the father of two
small children. John attends college at night and is
MyManagementLab
Now that you have finished this chapter, go back to www.mymanagementlab.com to continue
practicing and applying the concepts you’ve learned.
turnover, and deviant workplace behavior; and increase organizational citi-
zenship behavior and job satisfaction. Here are a few specific implications for
managers:
● Some generalizations provide valid insights into human behavior, but
many are erroneous. Organizational behavior uses systematic study to
improve predictions of behavior over intuition alone.
● Because people are different, we need to look at OB in a contingency frame-
work, using situational variables to explain cause-and-effect relationships.
● Organizational behavior offers specific insights to improve a manager’s
people skills.
● It helps managers to see the value of workforce diversity and practices
that may need to be changed in different countries.
● It can improve quality and employee productivity by showing managers
how to empower their people, design and implement change programs,
improve customer service, and help employees balance work–life conflicts.
● It can help managers cope in a world of temporariness and learn how to
stimulate innovation.
● Finally, OB can guide managers in creating an ethically healthy work
climate.

www.mymanagementlab.com

Ethical Dilemma 33
● Life insurance:
Plan A ($25,000 coverage) � $500
Plan B ($50,000 coverage) � $1,000
Plan C ($100,000 coverage) � $2,000
Plan D ($250,000 coverage) � $3,000
● Mental health plan � $500
● Prepaid legal assistance � $300
● Vacation � 2 percent of annual pay for each week, up
to 6 weeks a year
● Pension at retirement equal to approximately 50 per-
cent of final annual earnings � $1,500
● 4-day workweek during the 3 summer months
(available only to full-time employees) � 4 percent
of annual pay
● Day care services (after company contribution) �
$2,000 for all of an employee’s children, regardless
of number
● Company-provided transportation to and from
work � $750
● College tuition reimbursement � $1,000
● Language class tuition reimbursement � $500
The Task
1. Each group has 15 minutes to develop a flexible
benefits package that consumes 25 percent
(and no more!) of its character’s pay.
2. After completing step 1, each group appoints a
spokesperson who describes to the entire class the
benefits package the group has arrived at for its
character.
3. The entire class then discusses the results. How did
the needs, concerns, and problems of each partici-
pant influence the group’s decision? What do the
results suggest for trying to motivate a diverse
workforce?
within a year of earning his bachelor’s degree. His
salary is $27,000 per year. His wife is an attorney and
earns approximately $50,000 per year.
Lu is 26 years old and single with a master’s degree
in education. He is paralyzed and confined to a
wheelchair as a result of an auto accident. He earns
$32,000 per year.
Maria is a single, 22-year-old woman born and raised
in Mexico. She came to the United States only
3 months ago, and her English needs considerable
improvement. She earns $20,000 per year.
Mike is a 16-year-old high school sophomore who
works 15 hours per week after school and during
vacations. He earns $7.20 per hour, or approximately
$5,600 per year.
The members of each group are to assume the character
consistent with their assigned role.
Background
The six participants work for a company that has recently
installed a flexible benefits program. Instead of the tra-
ditional “one benefit package fits all,” the company is
allocating an additional 25 percent of each employee’s
annual pay to be used for discretionary benefits. Those
benefits and their annual cost are as follows:
● Supplementary health care for employee:
Plan A (no deductible and pays 90 percent) � $3,000
Plan B ($200 deductible and pays 80 percent) �
$2,000
Plan C ($1,000 deductible and pays 70 percent) � $500
● Supplementary health care for dependents (same
deductibles and percentages as above):
Plan A � $2,000
Plan B � $1,500
Plan C � $500
● Supplementary dental plan � $500
Source: Special thanks to Professor Penny Wright (San Diego State University) for her suggestions during
the development of this exercise.
ETHICAL DILEMMA Jekyll and Hyde
Let’s assume you have been offered a job by Jekyll
Corporation, a company in the consumer products indus-
try. The job is in your chosen career path.
Jekyll Corporation has offered you a position that
would begin 2 weeks after you graduate. The job respon-
sibilities are appealing to you, make good use of your
training, and are intrinsically interesting. The company
seems well positioned financially, and you have met the
individual who would be your supervisor, who assures you
that the future prospects for your position and career are
bright. Several other graduates of your program work at
Jekyll Corporation, and they speak quite positively of the
company and promise to socialize and network with you
once you start.
As a company, Jekyll Corporation promotes itself as a
fair-trade and sustainable organization. Fair trade is a trad-
ing partnership—based on dialogue, transparency, and
respect—that seeks greater equity in international trade.
It contributes to sustainable development by offering
better trading conditions to, and securing the rights of,

34 CHAPTER 1 What Is Organizational Behavior?
CASE INCIDENT 1 “Lessons for ‘Undercover’ Bosses”
Executive offices in major corporations are often far re-
moved from the day-to-day work that most employees per-
form. While top executives might enjoy the perquisites
found in the executive suite, and separation from workday
concerns can foster a broader perspective on the business,
the distance between management and workers can come
at a real cost: top managers often fail to understand the
ways most employees do their jobs every day. The dangers
of this distant approach are clear. Executives sometimes
make decisions without recognizing how difficult or im-
practical they are to implement. Executives can also lose
sight of the primary challenges their employees face.
The practice of “management by walking around”
(MBWA) works against the insularity of the executive
suite. To practice MBWA, managers reserve time to walk
through departments regularly, form networks of acquain-
tances in the organization, and get away from their desks
to talk to individual employees. The practice was exem-
plified by Bill Hewlett and Dave Packard, who used this
management style at HP to learn more about the chal-
lenges and opportunities their employees were encoun-
tering. Many other organizations followed suit and found
that this style of management had advantages over a typi-
cal desk-bound approach to management. A recent study
of successful Swedish organizations revealed that MBWA
was an approach common to several firms that received
national awards for being great places to work.
The popular television program Undercover Boss took
MBWA to the next level by having top executives from
companies like Chiquita Brands, DirectTV, Great Wolf
Resorts, and NASCAR work incognito among line em-
ployees. Executives reported that this process taught them
how difficult many of the jobs in their organizations were,
and just how much skill was required to perform even the
lowest-level tasks. They also said the experience taught
them a lot about the core business in their organizations
and sparked ideas for improvements.
Although MBWA has long had its advocates, it does
present certain problems. First, the time managers spend
directly observing the workforce is time they are not do-
ing their core job tasks like analysis, coordination, and
strategic planning. Second, management based on subjec-
tive impressions gathered by walking around runs counter
to a research and data-based approach to making mana-
gerial decisions. Third, it is also possible that executives
who wander about will be seen as intruders and overseers.
Implementing the MBWA style requires a great deal of
foresight to avoid these potential pitfalls.
local producers and businesses. Fair-trade organizations
are actively engaged in supporting producers and sustain-
able environmental farming practices, and fair-trade prac-
tices prohibit child or forced labor.
Yesterday, Gabriel Utterson—a human resources man-
ager at Jekyll Corporation—called you to discuss initial
terms of the offer, which seemed reasonable and standard
for the industry. However, one aspect was not mentioned,
your starting salary. Gabriel said Jekyll is an internally trans-
parent organization—there are no secrets. While the firm
very much wants to hire you, there are limits to what it can
afford to offer, and before it makes a formal offer, it was
reasonable to ask what you would expect. Gabriel wanted
you to think about this and call back tomorrow.
Before calling Gabriel, you thought long and hard
about what it would take to accept Jekyll Corporation’s
offer. You have a number in mind, which may or may not
be the same number you give Gabriel. What starting salary
would it take for you to accept Jekyll Corporation’s offer?
Questions
1. What starting salary will you give Gabriel? What sal-
ary represents the minimum offer you would accept?
If these two numbers are different, why? Does giving
Gabriel a different number than your “internal” num-
ber violate Jekyll Corporation’s transparent culture?
Why or why not?
2. Assume you’ve received another offer, this one from
Hyde Associates. Like the Jekyll job, this position is
on your chosen career path and in the consumer
products industry. Assume, however, that you’ve read
in the news that “Hyde Associates has been criticized for
unsustainable manufacturing practices that may be harm-
ful to the environment. It has further been criticized for un-
fair trade practices and for employing underage children.”
Would that change whether you’d be willing to take
the job? Why or why not?
3. These scenarios are based on studies of Corporate
Social Responsibility (CSR) practices that show con-
sumers generally charge a kind of rent to companies
that do not practice CSR. In other words, they gen-
erally expect a substantial discount in order to buy
a product from Hyde rather than from Jekyll. For
example, if Jekyll and Hyde sold coffee, people would
pay a premium of $1.40 to buy coffee from Jekyll and
demand a discount of $2.40 to buy Hyde coffee. Do
you think this preference translates into job choice
decisions? Why or why not?

Case Incident 2 35
Sources: Based on T. Peters and N. Austin, “Management by Walking About,” Economist (September 8,
2008), www.economist.com ; F. Aguirre, M. White, K. Schaefer, and S. Phelps, “Secrets of an Undercover
Boss,” Fortune (August 27, 2010), pp. 41–44; J. Larsson, I. Backstrom, and H. Wiklund, “Leadership
and Organizational Behavior: Similarities between Three Award-Winning Organizations,” International
Journal of Management Practice 3 (2009), pp. 327–345.
CASE INCIDENT 2 Era of the Disposable Worker?
The great global recession has claimed many victims. In
many countries, unemployment is at near-historic highs,
and even those who have managed to keep their jobs have
often been asked to accept reduced work hours or pay
cuts. Another consequence of the current business and
economic environment is an increase in the number of
individuals employed on a temporary or contingent basis.
The statistics on U.S. temporary workers are grim. Many,
like single mother Tammy Smith, have no health insur-
ance, no retirement benefits, no vacation, no severance,
and no access to unemployment insurance. Increases in
layoffs mean that many jobs formerly considered safe have
become “temporary” in the sense that they could disap-
pear at any time with little warning. Forecasts suggest that
the next 5 to 10 years will be similar, with small pay in-
creases, worse working conditions, and low levels of job se-
curity. As Peter Cappelli of the University of Pennsylvania’s
Wharton School notes, “Employers are trying to get rid of
all fixed costs. First they did it with employment benefits.
Now they’re doing it with the jobs themselves. Everything
is variable.”
We might suppose these corporate actions are largely
taking place in an era of diminishing profitability.
However, data from the financial sector is not consistent
with this explanation. Among Fortune 500 companies, 2009
saw the second-largest jump in corporate earnings in the
list’s 56-year history. Moreover, many of these gains do not
appear to be the result of increases in revenue. Rather,
they reflect dramatic decreases in labor costs. One equity
market researcher noted, “The largest part of the gain
came from lower payrolls rather than the sluggish rise in
sales . . .” Wages also rose only slightly during this period
of rapidly increasing corporate profitability.
Some observers suggest the very nature of corporate
profit monitoring is to blame for the discrepancy between
corporate profitability and outcomes for workers. Some
have noted that teachers whose evaluations are based on
standardized test scores tend to “teach to the test,” to the
detriment of other areas of learning. In the same way,
when a company is judged primarily by the single met-
ric of a stock price, executives naturally try their best to
increase this number, possibly to the detriment of other
concerns like employee well-being or corporate culture.
On the other hand, others defend corporate actions that
increase the degree to which they can treat labor flexibly,
noting that in an increasingly competitive global market-
place, it might be necessary to sacrifice some jobs to save
the organization as a whole.
The issues of how executives make decisions about
workforce allocation, how job security and corporate loy-
alty influence employee behavior, and how emotional
reactions come to surround these issues are all core com-
ponents of organizational behavior research.
Questions
1. To what extent can individual business decisions
(as opposed to economic forces) explain deteriora-
tion in working conditions for many workers?
2. Do business organizations have a responsibility to
ensure that employees have secure jobs with good
Questions
1. What are some of the things managers can learn by
walking around and having daily contact with line
employees that they might not be able to learn from
looking at data and reports?
2. As an employee, would you appreciate knowing your
supervisor regularly spent time with workers? How
would knowing top executives routinely interact
with line employees affect your attitudes toward the
organization?
3. What ways can executives and other organizational
leaders learn about day-to-day business operations
besides going “undercover?”
4. Are there any dangers in the use of a management
by walking around strategy? Could this strategy lead
employees to feel they are being spied on? What
actions on the part of managers might minimize
these concerns?

www.economist.com

36 CHAPTER 1 What Is Organizational Behavior?
4. What do you think the likely impact of the growth
of temporary employment relationships will be for
employee attitudes and behaviors? How would you
develop a measurement system to evaluate the impact
of corporate downsizing and temporary job assign-
ments on employees?
working conditions, or is their primary responsibility
to shareholders?
3. What alternative measures of organizational per-
formance, besides share prices, do you think might
change the focus of business leaders?
ENDNOTES
1. Cited in R. Alsop, “Playing Well with Others,” Wall Street
Journal (September 9, 2002).
2. See, for instance, C. Penttila, “Hiring Hardships,”
Entrepreneur (October 2002), pp. 34–35.
3. S. E. Humphrey, J. D. Nahrgang, and F. P. Morgeson,
“Integrating Motivational, Social, and Contextual Work
Design Features: A Meta-Analytic Summary and Theoretical
Extension of the Work Design Literature,” Journal of Applied
Psychology 92, no. 5 (2007), pp. 1332–1356.
4. I. S. Fulmer, B. Gerhart, and K. S. Scott, “Are the 100 Best
Better? An Empirical Investigation of the Relationship Between
Being a ‘Great Place to Work’ and Firm Performance,”
Personnel Psychology (Winter 2003), pp. 965–993.
5. H. Fayol, Industrial and General Administration (Paris: Dunod,
1916).
6. A. I. Kraut, P. R. Pedigo, D. D. McKenna, and M. D. Dunnette,
“The Role of the Manager: What’s Really Important in
Different Management Jobs,” Academy of Management
Executive 19, no. 4 (2005), pp. 122–129.
7. H. Mintzberg, The Nature of Managerial Work (Upper Saddle
River, NJ: Prentice Hall, 1973).
8. R. L. Katz, “Skills of an Effective Administrator,” Harvard
Business Review (September–October 1974), pp. 90–102;
D. Bartram, “The Great Eight Competencies: A Criterion-
Centric Approach to Validation,” Journal of Applied Psychology 90,
no. 6 (2005), pp. 1185–1203; and S. E. Scullen, M. K. Mount,
and T. A. Judge, “Evidence of the Construct Validity of Devel-
opmental Ratings of Managerial Performance,” Journal of
Applied Psychology 88, no. 1 (2003), pp. 50–66.
9. F. Luthans, “Successful vs. Effective Real Managers,”
Academy of Management Executive (May 1988), pp. 127–132;
and F. Luthans, R. M. Hodgetts, and S. A. Rosenkrantz,
Real Managers (Cambridge, MA: Ballinger, 1988). See also
F. Shipper and J. Davy, “A Model and Investigation of
Managerial Skills, Employees’ Attitudes, and Managerial
Performance,” Leadership Quarterly 13 (2002), pp. 95–120.
10. P. Wu, M. Foo, and D. B. Turban, “The Role of Personality
in Relationship Closeness, Developer Assistance, and Career
Success,” Journal of Vocational Behavior 73, no. 3 (2008),
pp. 440–448; and A. M. Konrad, R. Kashlak, I. Yoshioka,
R. Waryszak, and N. Toren, “What Do Managers Like to Do?
A Five-Country Study,” Group & Organization Management
(December 2001), pp. 401–433.
Sources: Based on P. Coy, M. Conlin, and M. Herbst, “The Disposable Worker,” Bloomberg Businessweek
(January 7, 2010), www.businessweek.com ; S. Tully, “Fortune 500: Profits Bounce Back,” Fortune (May 3,
2010), pp. 140–144; D. Ariely, “You Are What You Measure,” Harvard Business Review (June 2010), p. 38.
11. A. S. Tsui, S. J. Ashford, L. St. Clair, and K. R. Xin, “Dealing
with Discrepant Expectations: Response Strategies and
Managerial Effectiveness,” Academy of Management Journal
(December 1995), pp. 1515–1543.
12. See, for instance, C. Heath and S. B. Sitkin, “Big-B Versus
Big-O: What Is Organizational about Organizational
Behavior?” Journal of Organizational Behavior (February 2001),
pp. 43–58. For a review of what one eminent researcher be-
lieves should be included in organizational behavior, based
on survey data, see J. B. Miner, “The Rated Importance,
Scientific Validity, and Practical Usefulness of Organizational
Behavior Theories: A Quantitative Review,” Academy of
Management Learning & Education (September 2003),
pp. 250–268.
13. D. M. Rousseau and S. McCarthy, “Educating Managers from
an Evidence-Based Perspective,” Academy of Management
Learning & Education 6, no. 1 (2007), pp. 84–101; and
S. L. Rynes, T. L. Giluk, and K. G. Brown, “The Very Separate
Worlds of Academic and Practitioner Periodicals in Human
Resource Management: Implications for Evidence-Based
Management,” Academy of Management Journal 50, no. 5
(2007), pp. 987–1008.
14. J. Surowiecki, “The Fatal-Flaw Myth,” The New Yorker (July 31,
2006), p. 25.
15. C. Tuna, “No-Layoff Policies Crumble,” The Wall Street Journal
(December 29, 2008), p. B2.
16. See, for instance, S. D. Pugh, J. Dietz, J. W. Wiley, and
S. M. Brooks, “Driving Service Effectiveness through
Employee-Customer Linkages,” Academy of Management
Executive (November 2002), pp. 73–84; and H. Liao and
A. Chuang, “A Multilevel Investigation of Factors Influencing
Employee Service Performance and Customer Outcomes,”
Academy of Management Journal (February 2004), pp. 41–58.
17. See www.patagonia.com/jobs/retail_asst_mgr.shtml ; and
“Patagonia Sets the Pace for Green Business,” Grist Magazine
(October 22, 2004), www.grist.org .
18. See, for instance, M. Workman and W. Bommer, “Rede
Signing Computer Call Center Work: A Longitudinal Field
Experiment,” Journal of Organizational Behavior (May 2004),
pp. 317–337.
19. See, for instance, V. S. Major, K. J. Klein, and M. G. Ehrhart,
“Work Time, Work Interference with Family, and Psychological
Distress,” Journal of Applied Psychology (June 2002), pp. 427–436;
D. Brady, “Rethinking the Rat Race,” BusinessWeek (August 26,
2002), pp. 142–143; J. M. Brett and L. K. Stroh, “Working 61

www.businessweek.com

www.patagonia.com/jobs/retail_asst_mgr.shtml

www.grist.org

Endnotes 37
Plus Hours a Week: Why Do Managers Do It?” Journal of Applied
Psychology (February 2003), pp. 67–78.
20. See, for instance, The 2002 National Study of the Changing
Workforce (New York: Families and Work Institute, 2002); and
W. J. Casper and L. C. Buffardi, “Work-Life Benefits and Job
Pursuit Intentions: The Role of Anticipated Organizational
Support,” Journal of Vocational Behavior 65, no. 3 (2004),
pp. 391–410.
21. Cited in S. Armour, “Workers Put Family First Despite Slow
Economy, Jobless Fear” (citation number 21) is: S. Armour,
“Workers Put Family First Despite Slow Economy, Jobless
Fears,” USA Today, (June 6, 2002), p. 38.
22. S. Shellenbarger, “What Job Candidates Really Want to Know:
Will I Have a Life?” The Wall Street Journal (November 17,
1999), p. B1; and “U.S. Employers Polish Image to Woo a
Demanding New Generation,” Manpower Argus (February
2000), p. 2.
23. F. Luthans and C. M. Youssef, “Emerging Positive Organi-
zational Behavior,” Journal of Management (June 2007),
pp. 321–349; C. M. Youssef and F. Luthans, “Positive
Organizational Behavior in the Workplace: The Impact of
Hope, Optimism, and Resilience,” Journal of Management
33, no. 5 (2007), pp. 774–800; and J. E. Dutton and
S. Sonenshein, “Positive Organizational Scholarship,” in
C. Cooper and J. Barling (eds.), Encyclopedia of Positive
Psychology (Thousand Oaks, CA: Sage, 2007).
24. L. M. Roberts, G. Spreitzer, J. Dutton, R. Quinn,
E. Heaphy, and B. Barker, “How to Play to Your Strengths,”
Harvard Business Review (January 2005), pp. 1–6; and
L. M. Roberts, J. E. Dutton, G. M. Spreitzer, E. D. Heaphy,
and R. E. Quinn, “Composing the Reflected Best-Self
Portrait: Becoming Extraordinary in Work Organizations,”
Academy of Management Review 30, no. 4 (2005), pp. 712–736.
25. W. Bailey and A. Spicer, “When Does National Identity
Matter? Convergence and Divergence in International
Business Ethics,” Academy of Management Journal 50, no. 6
(2007), pp. 1462–1480; and A. B. Oumlil and J. L. Balloun,
“Ethical Decision-Making Differences between American
and Moroccan Managers,” Journal of Business Ethics 84, no. 4
(2009), pp. 457–478.
26. J. Merritt, “For MBAs, Soul-Searching 101,” BusinessWeek
(September 16, 2002), pp. 64–66; and S. Greenhouse, “The
Mood at Work: Anger and Anxiety,” The New York Times
(October 29, 2002), p. E1.
27. See, for instance, G. R. Weaver, L. K. Trevino, and P. L.
Cochran, “Corporate Ethics Practices in the Mid-1990’s: An
Empirical Study of the Fortune 1000,” Journal of Business Ethics
(February 1999), pp. 283–294; and C. De Mesa Graziano,
“Promoting Ethical Conduct: A Review of Corporate
Practices,” Strategic Investor Relations (Fall 2002), pp. 29–35.
28. D. M. Mayer, M. Kuenzi, R. Greenbaum, M. Bardes, and
R. Salvador, “How Low Does Ethical Leadership Flow?
Test of a Trickle-Down Model,” Organizational Behavior and
Human Decision Processes 108, no. 1 (2009), pp. 1–13; and
A. Ardichvili, J. A. Mitchell, and D. Jondle, “Characteristics
of Ethical Business Cultures,” Journal of Business Ethics 85,
no. 4 (2009), pp. 445–451.
29. “Unplanned Absence Costs Organizations 8.7 Percent
of Payroll, Mercer/Kronos Study” (June 28, 2010), www
.mercer.com/press-releases/1383785 .
30. W. Hoge, “Sweden’s Cradle-to-Grave Welfare Starts to Get
Ill,” International Herald Tribune (September 25, 2002), p. 8.
31. See www.bls.gov/data (May 11, 2005).
32. See, for example, M. C. Sturman and C. O. Trevor, “The
Implications of Linking the Dynamic Performance and
Turnover Literatures,” Journal of Applied Psychology (August
2001), pp. 684–696.
33. M. Casey-Campbell and M. L. Martens, “Sticking It All
Together: A Critical Assessment of the Group Cohesion-
Performance Literature,” International Journal of Management
Reviews 11, (2008), pp. 223–246.
34. A. J. Rucci, S. P. Kirn, and R. T. Quinn, “The Employee–
Customer–Profit Chain at Sears,” Harvard Business Review
(January–February 1998), pp. 83–97.

www.mercer.com/press-releases/1383785

www.bls.gov/data

THE RISE AND FALL OF ERIN CALLAN
38
E
rin Callan was one of those rare individuals who seemed to master
everything she undertook. Due to her precocious intelligence and
athletic prowess (at 13 she was one of the top gymnasts in New York),
people called her Wonder Child. She graduated magna cum laude from Harvard,
earned her law degree from New York University, and went to work for one of
the most prestigious law firms in New York City. In 1995, she went into bank-
ing, eventually rising to be chief financial officer (CFO) of one of the largest and
most prestigious U.S. investment banks, Lehman Brothers. At 41—young for a
CFO of such a large organization—Callan seemed to have it all. She was the first
woman ever to serve on the 158-year-old company’s executive committee. One
newspaper labeled her “Rising Star Erin Callan, now one of the most powerful
women on Wall Street.”
Now Callan is jobless and living in virtual exile on Long Island.
What happened?
The story of Erin Callan’s fall has a lot to do with the meltdown in the
financial services industry. Lehman, after all, went bankrupt in 2008, and
most senior executives lost their jobs. Most of its managers and executives,
however, have found work elsewhere. Why not Callan? The answer depends
on which narrative you accept. Callan refuses to discuss the issue with the
media. To some, she brought about her own downfall with her outsized
ambition and desire for attention. To others, she is the victim of a gender
double standard that is alive and well on Wall Street and elsewhere.
From one point of view, Callan caused her own demise. She lacked back-
ground in accounting, treasury, or operations—unusual for a CFO. According
to Fortune, many at Lehman disapproved of her brash style and provocative
wardrobe. “I don’t subordinate my feminine side,” she says. “I’m very open
about it. I have no problem talking about my shopper or my outfit.” When
Callan was named CFO, one of Lehman’s female senior executives went to
the CEO to rescind the promotion. Later, in the early days of the financial
meltdown, investors thought Callan’s responses were unimpressive. A few
months later, she was removed. Currently, the Securities and Exchange
Commission (SEC) is investigating whether her “forward looking statements”
regarding Lehman’s finances constitute civil fraud.
Read this way, Callan’s is the typical story of a Wall Street executive
caught unprepared for a crisis his or her decisions helped create. Is the story
so simple, though? After all, nearly all Callan’s male counterparts at Lehman
are now employed, including ex-CEO Richard Fuld (now managing member
of Matrix Advisors and advisor with Legend Securities). Many have landed at
Barclays, the British Bank that bought Lehman in bankruptcy.
LEARNING
OBJECTIVES
After studying this chapter,
you should be able to:
1 Describe the two major
forms of workforce
diversity.
2 Recognize stereotypes
and understand how they
function in organizational
settings.
3 Identify the key
biographical characteristics
and describe how they
are relevant to OB.
4 Define intellectual ability
and demonstrate its
relevance to OB.
5 Contrast intellectual
and physical ability.
6 Describe how organizations
manage diversity
effectively.
MyManagementLab
Access a host of interactive
learning aids to help strengthen
your understanding of the
chapter concepts at
www.mymanagementlab.com.

www.mymanagementlab.com

Diversity
in Organizations 2
I think that God in creating Man somewhat
overestimated his ability.
— Oscar Wilde
39Ph
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40 CHAPTER 2 Diversity in Organizations
S A L
SELF-ASSESSMENT LIBRARY
Does Callan’s sex have a role in this? Does an interest in fashion serve to
stigmatize women more than men? Does an interest in the media (“She was a
media hound,” said one Lehman executive) cast women in a harsher light?
Even National Public Radio (NPR) seemed to emphasize Callan’s looks over
her intellect. “Blonde, beautiful and outspoken, the spotlight loved Erin Callan.
Fortune magazine called her one of four women to watch,” said NPR. “Callan
cut a striking figure in her crochet-style dress, gold dangling earrings and
high-heeled boots.” Fortune said, “She arrived like a flash—a bright, glamorous
figure.” Were such descriptions applied to the male CFOs of Goldman Sachs,
Morgan Stanley, Merrill Lynch, or Bear Stearns?
As for Callan, friends say she is at peace with herself and her situation. “I’m
living a different life,” she recently told a reporter.
Sources: P. Sellers, “The Fall of a Wall Street Highflier,” Fortune (March 22, 2010), pp. 140–148;
P. Sellers, “Erin Callan, Lehman’s Ex-CFO, Goes Public,” CNN Money (February 22, 2011), www
.cnnmoney.com/ ; J. Quinn, “Goldman Outshines Rival Bear Stearns,” The Telegraph (September 21,
2007), www.telegraph.co.uk/ ; and C. Gasparino, “Lehman Probe Begins to Square in on Former
CFO,” FOXBusiness (June 10, 2010), www.foxbusiness.com/ .
S ex is but one characteristic people bring with them when they join an organization. In this chapter, we look at how organizations work to maxi-mize the potential contributions of a diverse workforce. We also show how
demographic characteristics such as ethnicity and individual differences in the
form of ability affect employee performance and satisfaction.
But first check out the following Self-Assessment Library, where you can
assess your views on one of the characteristics we’ll discuss in this chapter: age.
What’s My Attitude Toward Older People?
In the Self-Assessment Library (available on CD or online), take assessment IV.C.1
(What’s My Attitude Toward Older People?) and answer the following questions:
1. Are you surprised by your results?
2. How do your results compare to those of others?
We aren’t all the same. This is obvious enough, but managers sometimes forget
that they need to recognize and capitalize on these differences to get the most
from their employees. Effective diversity management increases an organiza-
tion’s access to the widest possible pool of skills, abilities, and ideas. Managers
also need to recognize that differences among people can lead to miscommu-
nication, misunderstanding, and conflict. In this chapter, we’ll learn about how
1 Describe the two major
forms of workforce diversity.
Diversity

www.cnnmoney.com/

www.telegraph.co.uk/

www.foxbusiness.com/

Diversity 41
individual characteristics like age, gender, race, ethnicity, and abilities can influ-
ence employee performance. We’ll also see how managers can develop aware-
ness about these characteristics and manage a diverse workforce effectively.
Demographic Characteristics of the U.S. Workforce
In the past, OB textbooks noted that rapid change was about to occur as
the predominantly white, male managerial workforce gave way to a gender-
balanced, multiethnic workforce. Today, that change is no longer happening: it
has happened, and it is increasingly reflected in the makeup of managerial and
professional jobs. Compared to 1976, women today are much more likely to be
employed full-time, have more education, and earn wages comparable to those
of men. 1 In addition, over the past 50 years the earnings gap between Whites
and other racial and ethnic groups has decreased significantly; past differences
between Whites and Asians have disappeared or been reversed. 2 Workers over
the age of 55 are an increasingly large portion of the workforce as well. This
permanent shift toward a diverse workforce means organizations need to make
diversity management a central component of their policies and practices. At
the same time, however, differences in wages across genders and racial and eth-
nic groups persist, and executive positions in Fortune 500 corporations continue
to be held by white males in numbers far beyond their representation in the
workforce in general.
A survey by the Society for Human Resources Management shows some
major employer concerns and opportunities resulting from the demographic
makeup of the U.S. workforce. 3 The aging of the workforce was consistently
the most significant concern of HR managers. The loss of skills resulting from
the retirement of many baby boomers, increased medical costs due to an aging
workforce, and many employees’ needs to care for elderly relatives topped the
list of issues. Other issues include developing multilingual training materials
and providing work–life benefits for dual-career couples.
Progress Energy reflects the
demographic characteristics of the
U.S. workforce today. It is gender
balanced, multiethnic, and engaged
in learning about diversity issues
and putting them into practice.
Progress, which recently merged
with Duke Energy, encourages
employees to participate in various
network groups, diversity councils,
and training workshops, such as
the one shown here. The company
believes that recognizing and
embracing diversity maximize
employee potential, customer
satisfaction, and business success.
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42 CHAPTER 2 Diversity in Organizations
Levels of Diversity
Although much has been said about diversity in age, race, gender, ethnicity,
religion, and disability status, experts now recognize that these demographic
characteristics are just the tip of the iceberg. 4 Demographics mostly reflect surface-
level diversity , not thoughts and feelings, and can lead employees to perceive one
another through stereotypes and assumptions. However, evidence has shown that as
people get to know one another, they become less concerned about demographic
differences if they see themselves as sharing more important characteristics, such as
personality and values, that represent deep-level diversity . 5
To understand this difference between surface- and deep-level diversity,
consider a few examples. Luis and Carol are co-workers who seem to have little
in common at first glance. Luis is a young, recently hired male college graduate
with a business degree, raised in a Spanish-speaking neighborhood in Miami.
Carol is an older, long-tenured woman raised in rural Kansas, who achieved her
current level in the organization by starting as a high school graduate and work-
ing her way through the hierarchy. At first, these co-workers may experience
some differences in communication based on their surface-level differences in
education, ethnicity, regional background, and gender. However, as they get
to know one another, they may find they are both deeply committed to their
families, share a common way of thinking about important work problems, like
to work collaboratively, and are interested in international assignments in the
future. These deep-level similarities will overshadow the more superficial differ-
ences between them, and research suggests they will work well together.
On the other hand, Steve and Dave are two unmarried white male college
graduates from Oregon who recently started working together. Superficially,
they seem well matched. But Steve is highly introverted, prefers to avoid risks,
solicits the opinions of others before making decisions, and likes the office
quiet, while Dave is extroverted, risk-seeking, and assertive and likes a busy,
active, and energetic work environment. Their surface-level similarity will not
necessarily lead to positive interactions because they have such fundamental,
deep-level differences. It will be a challenge for them to collaborate regularly at
work, and they’ll have to make some compromises to get things done together.
Throughout this book, we will encounter differences between deep- and
surface-level diversity in various contexts. Individual differences in personality
and culture shape preferences for rewards, communication styles, reactions to
leaders, negotiation styles, and many other aspects of behavior in organizations.
Discrimination
Although diversity does present many opportunities for organizations, effective
diversity management also means working to eliminate unfair discrimination .
To discriminate is to note a difference between things, which in itself isn’t
necessarily bad. Noticing one employee is more qualified is necessary for making
hiring decisions; noticing another is taking on leadership responsibilities
exceptionally well is necessary for making promotion decisions. Usually when we
talk about discrimination, though, we mean allowing our behavior to be influ-
enced by stereotypes about groups of people. Rather than looking at individual
characteristics, unfair discrimination assumes everyone in a group is the same.
This discrimination is often very harmful to organizations and employees.
Exhibit 2-1 provides definitions and examples of some forms of discrimina-
tion in organizations. Although many of these actions are prohibited by law,
and therefore aren’t part of almost any organization’s official policies, thou-
sands of cases of employment discrimination are documented every year, and
many more go unreported. As discrimination has increasingly come under both
2 Recognize stereotypes
and understand how they
function in organizational
settings.

Diversity 43
surface-level diversity Differences
in easily perceived characteristics,
such as gender, race, ethnicity, age,
or disability, that do not necessarily
reflect the ways people think or
feel but that may activate certain
stereotypes.
deep-level diversity Differences
in values, personality, and work
preferences that become progressively
more important for determining
similarity as people get to know one
another better.
discrimination Noting of a difference
between things; often we refer to
unfair discrimination, which means
making judgments about individuals
based on stereotypes regarding their
demographic group.
Type of Discrimination Defi nition Examples from Organizations
Discriminatory policies Actions taken by representatives of the Older workers may be targeted for layoffs
or practices organization that deny equal opportunity because they are highly paid and have lucrative
to perform or unequal rewards for benefi ts.
performance
Sexual harassment Unwanted sexual advances and other Salespeople at one company went on company-paid
verbal or physical conduct of a sexual visits to strip clubs, brought strippers into the offi ce to
nature that create a hostile or offensive celebrate promotions, and fostered pervasive sexual
work environment rumors.
Intimidation Overt threats or bullying directed at African-American employees at some companies have
members of specifi c groups of employees found nooses hanging over their work stations.
Mockery and insults Jokes or negative stereotypes; sometimes Arab-Americans have been asked at work whether
the result of jokes taken too far they were carrying bombs or were members of
terrorist organizations.
Exclusion Exclusion of certain people from job Many women in fi nance claim they are assigned to
opportunities, social events, discussions, marginal job roles or are given light workloads that
or informal mentoring; can occur don’t lead to promotion.
unintentionally
Incivility Disrespectful treatment, including Female lawyers note that male attorneys frequently
behaving in an aggressive manner, cut them off or do not adequately address their
interrupting the person, or ignoring comments.
his or her opinions
Forms of Discrimination
Sources: J. Levitz and P. Shishkin, “More Workers Cite Age Bias after Layoffs,” The Wall Street Journal (March 11, 2009), pp. D1–D2; W. M. Bulkeley, “A Data-Storage Titan Confronts Bias Claims,”
The Wall Street Journal (September 12, 2007), pp. A1, A16; D. Walker, “Incident with Noose Stirs Old Memories,” McClatchy-Tribune Business News (June 29, 2008); D. Solis, “Racial Horror Stories
Keep EEOC Busy,” Knight-Ridder Tribune Business News, July 30, 2005, p. 1; H. Ibish and A. Stewart, Report on Hate Crimes and Discrimination Against Arab Americans: The Post-September 11
Backlash, September 11, 2001—October 11, 2001 (Washington, DC: American-Arab Anti-Discrimination Committee, 2003); A. Raghavan, “Wall Street’s Disappearing Women,” Forbes (March 16, 2009),
pp. 72–78; and L. M. Cortina, “Unseen Injustice: Incivility as Modern Discrimination in Organizations,” Academy of Management Review 33, no. 1 (2008), pp. 55–75.
Exhibit 2-1
legal scrutiny and social disapproval, most overt forms have faded, which may
have resulted in an increase in more covert forms like incivility or exclusion. 6
As you can see, discrimination can occur in many ways, and its effects can be
just as varied depending on the organizational context and the personal biases
of its members. Some forms, like exclusion or incivility, are especially hard to
root out because they are impossible to observe and may occur simply because
the actor isn’t aware of the effects of his or her actions. Whether intentional
or not, discrimination can lead to serious negative consequences for employ-
ers, including reduced productivity and citizenship behavior, negative conflicts,
and increased turnover. Unfair discrimination also leaves qualified job candi-
dates out of initial hiring and promotions. Even if an employment discrimina-
tion lawsuit is never filed, a strong business case can be made for aggressively
working to eliminate unfair discrimination.
Diversity is a broad term, and the phrase workplace diversity can refer to any
characteristic that makes people different from one another. The following
section covers some important surface-level characteristics that differentiate
members of the workforce.

44 CHAPTER 2 Diversity in Organizations
Biographical characteristics such as age, gender, race, disability, and length of
service are some of the most obvious ways employees differ. As discussed in
Chapter 1 , this textbook is essentially concerned with finding and analyzing
the variables that affect employee productivity, absence, turnover, deviance,
citizenship, and satisfaction (refer back to Exhibit 1-4 ). Many organizational
concepts—motivation, say, or power and politics or organizational culture—are
hard to assess. Let’s begin, then, by looking at factors that are easily definable
and readily available—data that can be obtained, for the most part, from an
employee’s human resources (HR) file. Variations in these surface-level char-
acteristics may be the basis for discrimination against classes of employees, so
it is worth knowing how closely related they actually are to important work out-
comes. Many are not as important as people believe, and far more variation
occurs within groups sharing biographical characteristics than between them.
Age
The relationship between age and job performance is likely to be an issue
of increasing importance during the next decade for at least three reasons.
First, belief is widespread that job performance declines with increasing age.
Regardless of whether this is true, a lot of people believe it and act on it. Second,
as noted in Chapter 1 , the workforce is aging. Many employers recognize that
older workers represent a huge potential pool of high-quality applicants.
Companies such as Borders and the Vanguard Group have sought to increase
their attractiveness to older workers by providing targeted training that meets
their needs, and by offering flexible work schedules and part-time work to draw
in those who are semi-retired. 7 The third reason is U.S. legislation that, for all
intents and purposes, outlaws mandatory retirement. Most U.S. workers today
no longer have to retire at age 70.
Biographical Characteristics
3 Identify the key biographical
characteristics and describe
how they are relevant to OB.
Older employees are an integral
part of the workforce at Publix
Supermarkets, where one in five
employees is over the age of 50.
The company values the work ethic
and maturity of its senior associates
like the man shown here preparing
salmon pinwheels for customers
to sample. Publix is known for its
employment of senior citizens and
actively recruits older workers as
part of its corporate philosophy
of providing a diverse work place.
The company believes that older
workers have a strong work ethic,
many skills, and job knowledge
that they can share with younger
co-workers.
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Biographical Characteristics 45
What is the perception of older workers? Employers hold mixed feelings. 8
They see a number of positive qualities older workers bring to their jobs, such
as experience, judgment, a strong work ethic, and commitment to quality.
But older workers are also perceived as lacking flexibility and resisting new
technology. And when organizations are actively seeking individuals who are
adaptable and open to change, the negatives associated with age clearly hinder
the initial hiring of older workers and increase the likelihood they will be let go
during cutbacks.
Now let’s take a look at the evidence. What effect does age actually have
on turnover, absenteeism, productivity, and satisfaction? The older you get,
the less likely you are to quit your job. That conclusion is based on studies of
the age–turnover relationship. 9 Of course, this shouldn’t be too surprising. As
workers get older, they have fewer alternative job opportunities as their skills
have become more specialized to certain types of work. Their long tenure also
tends to provide them with higher wage rates, longer paid vacations, and more
attractive pension benefits.
It’s tempting to assume that age is also inversely related to absenteeism. After
all, if older workers are less likely to quit, won’t they also demonstrate higher
stability by coming to work more regularly? Not necessarily. Most studies do show
an inverse relationship, but close examination finds it is partially a function of
whether the absence is avoidable or unavoidable. 10 In general, older employees
have lower rates of avoidable absence than do younger employees. However,
they have equal rates of unavoidable absence, such as sickness absences.
How does age affect productivity? Many believe productivity declines with
age. It is often assumed that skills like speed, agility, strength, and coordination
decay over time and that prolonged job boredom and lack of intellectual
stimulation contribute to reduced productivity. The evidence, however,
contradicts those assumptions. During a 3-year period, a large hardware chain
staffed one of its stores solely with employees over age 50 and compared its
results with those of five stores with younger employees. The store staffed by
the over-50 employees was significantly more productive (in terms of sales
generated against labor costs) than two of the stores and held its own against
the other three. 11 Other reviews of the research find that age and job task
performance are unrelated and that older workers are more likely to engage in
citizenship behavior. 12
Our final concern is the relationship between age and job satisfaction, where
the evidence is mixed. A review of more than 800 studies found that older work-
ers tend to be more satisfied with their work, report better relationships with
co-workers, and are more committed to their employing organizations. 13 Other
studies, however, have found a U-shaped relationship. 14 Several explanations
could clear up these results, the most plausible being that these studies are
intermixing professional and nonprofessional employees. When we separate
the two types, satisfaction tends to continually increase among professionals as
they age, whereas it falls among nonprofessionals during middle age and then
rises again in the later years.
biographical characteristics Personal
characteristics—such as age, gender,
race, and length of tenure—that
are objective and easily obtained
from personnel records. These
characteristics are representative
of surface-level diversity.

46 CHAPTER 2 Diversity in Organizations
What are the effects of discrimination against individuals on the basis of
age? One large-scale study of more than 8,000 employees in 128 companies
found that an organizational climate favoring age discrimination was associated
with lower levels of commitment to the company. This lower commitment was,
in turn, related to lower levels of organizational performance. 15 Such results
suggest that combating age discrimination may be associated with higher levels
of organizational performance.
Sex
Few issues initiate more debates, misconceptions, and unsupported opinions
than whether women perform as well on jobs as men do.
The best place to begin to consider this is with the recognition that few,
if any, important differences between men and women affect job perfor-
mance. There are no consistent male–female differences in problem-solving
ability, analytical skills, competitive drive, motivation, sociability, or learn-
ing ability. 16 Psychological studies have found women are more agreeable
and willing to conform to authority, whereas men are more aggressive and
more likely to have expectations of success, but those differences are minor.
Given the significantly increased female participation in the workforce over
the past 40 years and the rethinking of what constitutes male and female
roles, we can assume no significant difference in job productivity between
men and women. 17
Unfortunately, sex roles still affect our perceptions. For example, women
who succeed in traditionally male domains are perceived as less likable, more
hostile, and less desirable as supervisors. 18 Interestingly, research also suggests
that women believe sex-based discrimination is more prevalent than do male
employees, and these beliefs are especially pronounced among women who
work with a large proportion of men. 19
One issue that does seem to differ between men and women, especially
when the employee has preschool-age children, is preference for work sched-
ules. 20 Working mothers are more likely to prefer part-time work, flexible
work schedules, and telecommuting in order to accommodate their fam-
ily responsibilities. Women also prefer jobs that encourage work–life bal-
ance, which has the effect of limiting their options for career advancement.
An interview study showed many of the work–life issues found in U.S. busi-
ness contexts are also common in France, despite government subsidies for
child care. 21
What about absence and turnover rates? Are women less stable employees
than men? First, evidence from a study of nearly 500,000 professional employ-
ees indicates significant differences, with women more likely to turn over than
men. 22 Women also have higher rates of absenteeism than men do. 23 The most
logical explanation is that the research was conducted in North America, and
North American culture has historically placed home and family responsibili-
ties on women. When a child is ill or someone needs to stay home to wait for
a plumber, the woman has traditionally taken time from work. However, this
research is also undoubtedly time-bound. 24 The role of women has definitely
changed over the past generation. Men are increasingly sharing responsibility
for child care, and an increasing number report feeling a conflict between their
home responsibilities and their work lives. 25 One interesting finding is that
regardless of sex, parents were rated lower in job commitment, achievement
striving, and dependability than individuals without children, but mothers were
rated especially low in competence. 26
Again, it is worth asking what the implications of sex discrimination are for
individuals. Research has shown that workers who experience sexual harassment

Biographical Characteristics 47
have higher levels of psychological stress, and these feelings in turn are related
to lower levels of organizational commitment and job satisfaction, and higher
intentions to turn over. 27 As with age discrimination, the evidence suggests that
combating sex discrimination may be associated with better performance for the
organization as a whole.
Sexual Harassment Claims by MenOB Poll
Utah
21.7
32.2 33.3
27.3
16.6
26.6
9.5
24.0
18.7
23.0
Sexual Harassment Claims Filed by Men in Selected States
35
30
25
20
15
10
5
0
West Virginia Michigan Wyoming Wisconsin
2007 2009

Sources: Equal Employment Opportunity Commission; D. Mattioli, “More Men Make Harassment Claims,” The Wall Street Journal (March 23, 2010), p. D4.
T
his statement is mostly false.
A recent large-scale study of
married couples in the United
States, the United Kingdom, and
Germany found that in all three countries
whether a wife worked outside the
home, and what she earned if she did,
had no effect on divorce rates. The
authors of this study conclude: “In no
country did a wife’s employment or
relative earnings significantly increase
the risk of dissolution.” Thus, it appears
that social critics on both the left
(dual-career couples have healthier,
happier marriages) and the right (a
traditional male working, wife at home
family structure is best) are wrong. Still,
this is a complex issue, and research on
it continues.
What about whether the husband
works outside the home? Historically,
this was quite unusual, but it is
becoming increasingly common—
wives are now the primary breadwinner
in 22 percent of U.S. couples, up from
7 percent in 1970. There is some evi-
dence that men are less healthy and
marriages are more likely to fail when
men do not work outside the home, or
when they become unemployed while
their wives continue to work. As one
researcher noted, many married men
ask themselves, “What is my value
here if I’m not bringing in money?” One
Canadian working mother, the primary
breadwinner in her family, says, “There
is a part of me that wonders if I can
trust, if it’s safe for me to take my foot
off the gas, to hold back and relax, not
be thinking and working all the time.”
Sources: L. P. P. Cooke, “Wives’ Part-time
Employment and Marital Stability in Great
Britain, West Germany and the United
States,” Sociology 44, no. 6 (2010),
pp. 1091–1108; T. Parker-Pope, “She Works.
They’re Happy.” The New York Times
(January 24, 2010), pp. ST1, ST10; and
S. Proudfoot, “More Women Bringing Home
the Bacon, More Men Cooking It,” National
Post (October 7, 2010), www.canada.com/ .
Myth or Science?
“Dual-Career Couples Divorce Less”

www.canada.com/

48 CHAPTER 2 Diversity in Organizations
Race and Ethnicity
Race is a controversial issue. In many cases, even bringing up the topic of race
and ethnicity is enough to create an uncomfortable silence. Indeed, evidence
suggests that some people find interacting with other racial groups uncomfort-
able unless there are clear behavioral scripts to guide their behavior. 28
Most people in the United States identify themselves according to racial group.
The U.S. Bureau of the Census classifies individuals according to seven broad
racial categories: American Indian and Alaska Native, Asian, Black or African
American, Native Hawaiian and Other Pacific Islander, Some Other Race, White,
and Two or More Races. An ethnicity distinction is also made between native
English speakers and Hispanics: Hispanics can be of any race. We define race in
this book as the biological heritage people use to identify themselves; ethnicity is
the additional set of cultural characteristics that often overlaps with race. This
definition allows each individual to define his or her race and ethnicity.
Race and ethnicity have been studied as they relate to employment out-
comes such as hiring decisions, performance evaluations, pay, and workplace
discrimination. Most research has concentrated on the differences in outcomes
and attitudes between Whites and African Americans, with little study of issues
relevant to Asian, Native American, and Hispanic populations. Doing justice to
all this research isn’t possible here, so let’s summarize a few points.
First, in employment settings, individuals tend to slightly favor colleagues
of their own race in performance evaluations, promotion decisions, and pay
raises, although such differences are not found consistently, especially when
highly structured methods of decision making are employed. 29 Second, substan-
tial racial differences exist in attitudes toward affirmative action, with African
Americans approving of such programs to a greater degree than Whites. 30
This difference may reflect the fact that African Americans and Hispanics per-
ceive discrimination to be more prevalent in the workplace. 31 Third, African
Americans generally fare worse than Whites in employment decisions. They
receive lower ratings in employment interviews, receive lower job performance
ratings, are paid less, and are promoted less frequently. 32 Yet there are no
statistically significant differences between African Americans and Whites in
observed absence rates, applied social skills at work, or accident rates. African
Americans and Hispanics also have higher turnover rates than Whites.
Employers’ major concern about using mental-ability tests for selection,
promotion, training, and similar employment decisions is that they may have a
negative impact on racial and ethnic groups. 33 However, evidence suggests that
“despite group differences in mean test performance, there is little convincing
evidence that well-constructed tests are more predictive of educational, train-
ing, or occupational performance for members of the majority group than for
members of minority groups.” 34 Observed differences in IQ test scores by racial
or ethnic group are smaller in more recent samples. 35 The issue of racial differ-
ences in general mental-ability tests continues to be hotly debated. 36
Does racial and ethnic discrimination lead to negative workplace outcomes?
As noted earlier, most research shows that members of racial and ethnic
minorities report higher levels of discrimination in the workplace. 37 Some
research suggests that having a positive climate for diversity overall can lead to
increased sales. 38
Disability
With the passage of the Americans with Disabilities Act (ADA) in 1990, the
representation of individuals with disabilities in the U.S. workforce rapidly
increased. 39 According to the ADA, employers are required to make reasonable

Biographical Characteristics 49
accommodations so their workplaces will be accessible to individuals with physi-
cal or mental disabilities.
Making inferences about the relationship between disability and employ-
ment outcomes is difficult because the term disability is so broad. The U.S.
Equal Employment Opportunity Commission classifies a person as disabled
who has any physical or mental impairment that substantially limits one or
more major life activities. Examples include missing limbs, seizure disorder,
Down Syndrome, deafness, schizophrenia, alcoholism, diabetes, and chronic
back pain. These conditions share almost no common features, so there’s no
generalization about how each condition is related to employment. Some jobs
obviously cannot be accommodated to some disabilities—the law and common
sense recognize that a blind person could not be a bus driver, a person with
severe cerebral palsy could not be a surgeon, and a person with profound
mobility constraints probably could not be a police patrol officer. However,
the increasing presence of computer technology and other adaptive devices is
shattering many traditional barriers to employment.
One of the most controversial aspects of the ADA is the provision that
requires employers to make reasonable accommodations for people with
psychiatric disabilities. 40 Most people have very strong biases against those with
mental illnesses, who are therefore reluctant to disclose this information to
employers. Many who do, report negative consequences.
The impact of disabilities on employment outcomes has been explored from
a variety of perspectives. On the one hand, a review of the evidence suggests
workers with disabilities receive higher performance evaluations. However,
this same review found that despite their higher performance, individuals with
disabilities tend to encounter lower performance expectations and are less
likely to be hired. 41 These negative effects are much stronger for individuals
with mental disabilities, and there is some evidence to suggest mental disabilities
may impair performance more than physical disabilities: Individuals with such
common mental health issues as depression and anxiety are significantly more
likely to be absent from work. 42
Microsoft views employees with
disabilities as valuable assets
because they help ensure that the
company’s products and services
meet all customer needs. At
the Microsoft Accessibility Lab,
employees can experience assistive
technologies and ergonomic
hardware designs that enable
them to be more productive. Kelly
Ford, who has been blind since
birth, is shown here in the lab
testing accessibility features of
the Windows operating system.
Ford also manages a team that is
working on improving Web page
browsing for all users, not just for
people with disabilities.
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50 CHAPTER 2 Diversity in Organizations
Several studies have examined participants who received résumés that were
identical, except that some mentioned a disability. The résumés that mentioned
mental illness or a physical disability were associated with much lower ratings
for perceived employability, especially in jobs requiring a great deal of personal
contact with the public. 43 Employability ratings for individuals with mental
illnesses were especially low. Similarly, when given randomly manipulated
academic portfolios, students preferred not to work with individuals who
had a learning disability even though there were no effects of disability on
performance ratings or expectations. 44
Contrast these selection-oriented results with studies showing that the
accomplishments of those with disabilities are often rated as more impressive
than the same accomplishments in people without disabilities. Participants
watched three individuals completing a carpentry task, one of whom was
described as having recently been hospitalized for a debilitating mental illness. 45
The raters consistently gave that person higher performance ratings. In this
case, it may be that disabled individuals were being treated as an outgroup in
need of special help. Similarly, when disability status is randomly manipulated
among hypothetical candidates, disabled individuals are rated as having
superior personal qualities like dependability and potency. 46
Other Biographical Characteristics: Tenure, Religion,
Sexual Orientation, and Gender Identity
The last set of biographical characteristics we’ll look at includes tenure, reli-
gion, sexual orientation, and gender identity.
Tenure Except for gender and racial differences, few issues are more subject to
misconceptions and speculations than the impact of seniority on job performance.
Extensive reviews have been conducted of the seniority–productivity
relationship. 47 If we define seniority as time on a particular job, the most recent
evidence demonstrates a positive relationship between seniority and job
productivity. So tenure, expressed as work experience, appears to be a good
predictor of employee productivity.
The research relating tenure to absence is quite straightforward. Studies
consistently show seniority to be negatively related to absenteeism. 48 In fact,
in terms of both frequency of absence and total days lost at work, tenure is the
single most important explanatory variable. 49
Tenure is also a potent variable in explaining turnover. The longer a person
is in a job, the less likely he or she is to quit. 50 Moreover, consistent with research
suggesting past behavior is the best predictor of future behavior, evidence
indicates tenure at an employee’s previous job is a powerful predictor of that
employee’s future turnover. 51
Evidence indicates tenure and job satisfaction are positively related. 52 In
fact, when age and tenure are treated separately, tenure appears a more consis-
tent and stable predictor of job satisfaction than age.
Religion Not only do religious and nonreligious people question each other’s
belief systems; often people of different religious faiths conflict. As the war in
Iraq and the past conflict in Northern Ireland demonstrate, violent differences
can erupt among sects of the same religion. U.S. federal law prohibits employ-
ers from discriminating against employees based on their religion, with very few
exceptions. However, that doesn’t mean religion is a nonissue in OB.
Perhaps the greatest religious diversity issue in the United States today
revolves around Islam. There are nearly 2 million Muslims in the United States,

Biographical Characteristics 51
and across the world Islam is one of the most popular religions. There are a
wide variety of perspectives on Islam. As one Islamic scholar has noted, “There
is no such thing as a single American Muslim community, much as there is no
single Christian community. Muslims vary hugely by ethnicity, faith, tradition,
education, income, and degree of religious observance.” 53 For the most part,
U.S. Muslims have attitudes similar to those of other U.S. citizens (though the
differences tend to be greater for younger U.S. Muslims). Still, there are both
perceived and real differences. Nearly four in ten U.S. adults admit they harbor
negative feelings or prejudices toward U.S. Muslims, and 52 percent believe
U.S. Muslims are not respectful of women. Some take these general biases a
step further. Motaz Elshafi, a 28-year-old software engineer for Cisco Systems,
born and raised in New Jersey, received an e-mail from a co-worker addressed
“Dear Terrorist.” Research has shown that job applicants in Muslim-identified
religious attire who applied for hypothetical retail jobs in the United States had
shorter, more interpersonally negative interviews than applicants who did not
wear Muslim-identified attire. 54
Faith can be an employment issue when religious beliefs prohibit or encour-
age certain behaviors. Based on their religious beliefs, some pharmacists refuse
to hand out RU-486, the “morning after” abortion pill. Many Christians do not
believe they should work on Sundays, and many conservative Jews believe they
should not work on Saturdays. Religious individuals may also believe they have
an obligation to express their beliefs in the workplace, and those who do not
share those beliefs may object. Perhaps as a result of different perceptions of
religion’s role in the workplace, religious discrimination claims have been a
growing source of discrimination claims in the United States.
Sexual Orientation and Gender Identity Employers differ widely in their treat-
ment of sexual orientation. Federal law does not prohibit discrimination against
C
o n s i d e r i n g t h e f o l l o w i n g
situation . . .
Edward practices the Kemetic religion,
based on ancient Egyptian faith, and
affiliates himself with a tribe number-
ing fewer than ten members. He states
that he believes in various deities and
follows the faith’s concept of Ma’at, a
guiding principle regarding truth and
order that represents physical and
moral balance in the universe. During
a religious ceremony he received small
tattoos encircling his wrist, written in
the Coptic language, which express
his servitude to Ra, the Egyptian god
of the sun. When his employer asks
him to cover the tattoos, he explains
that it is a sin to cover them intention-
ally because doing so would signify a
rejection of Ra.
If you were Edward’s employer, how
would you respond to his request? If
several valued customers objected to
Edward’s tattoos, would it affect your
response?
It may surprise you to learn that
the Equal Employment Opportunity
Commission (EEOC), the chief regula-
tory agency that enforces laws against
workplace discrimination, holds that
Edward’s employer may not ask him to
cover his tattoos. The seeming strange-
ness of Edward’s religious views is
not legally relevant. The EEOC notes,
“These can be religious beliefs and prac-
tices even if no one else or few other
people subscribe to them.” If Edward’s
tattoos did not emanate from sincere
religious beliefs, however, the employer
could ask him to cover them.
The upshot: Diversity, ethics, and
legal compliance are not always the
same thing. Sometimes what is legal
is not what you might do, and some-
times what you might do is not legal.
Source: N. C. Earp, “Unique Belief Can
Be Religious,” EEOC Compliance Manual
(downloaded April 27, 2011), www.eeoc
.gov/policy/docs/religion.html .
An Ethical Choice
Religious Tattoos

www.eeoc.gov/policy/docs/religion.html

52 CHAPTER 2 Diversity in Organizations
employees based on sexual orientation, though many states and municipalities
do. In general, observers note that even in the absence of federal legislation
requiring nondiscrimination, many organizations have implemented policies
and procedures protecting employees on the basis of sexual orientation. 55
Raytheon, builder of Tomahawk cruise missiles and other defense systems,
offers domestic-partner benefits, supports a wide array of gay rights groups, and
wants to be an employer of choice for gays. The firm believes these policies give it
an advantage in the ever-competitive market for engineers and scientists. Raytheon
is not alone. More than half the Fortune 500 companies offer domestic-partner
benefits for gay couples, including American Express, IBM, Intel, Morgan Stanley,
Motorola, and Walmart. Some companies oppose domestic-partner benefits or
nondiscrimination clauses for gay employees. Among these are Alltel, ADM,
ExxonMobil, H. J. Heinz, Nissan, Nestlé, and Rubbermaid. 56 Despite some gains,
many lesbian, gay, and bisexual employees keep their gender identity from their
co-workers for fear of being discriminated against. 57
As for gender identity, companies are increasingly putting in place policies
to govern how their organization treats employees who change genders (often
called transgender employees ). In 2001, only eight companies in the Fortune 500 had
policies on gender identity. By 2006, that number had swelled to 124. IBM is one
of them. Brad Salavich, a diversity manager for IBM, says, “We believe that having
strong transgender and gender identification policies is a natural extension of
IBM’s corporate culture.” Dealing with transgender employees requires some
special considerations, such as for bathrooms, employee names, and so on. 58
We’ve so far covered surface characteristics unlikely, on their own, to directly
relate to job performance. Now we turn to deep-level abilities that are closely
related to job performance. Contrary to what we were taught in grade school,
we weren’t all created equal in our abilities. Most people are to the left or the
right of the median on some normally distributed ability curve. For example,
regardless of how motivated you are, it’s unlikely you can act as well as Scarlett
Johansson, play basketball as well as LeBron James, write as well as J. K. Rowling,
or play the guitar as well as Pat Metheny. Of course, just because we aren’t all
equal in abilities does not imply that some individuals are inherently inferior.
Everyone has strengths and weaknesses that make him or her relatively supe-
rior or inferior to others in performing certain tasks or activities. From man-
agement’s standpoint, the issue is not whether people differ in terms of their
abilities. They clearly do. The issue is using the knowledge that people differ to
increase the likelihood an employee will perform his or her job well.
What does ability mean? As we use the term, ability is an individual’s current
capacity to perform the various tasks in a job. Overall abilities are essentially
made up of two sets of factors: intellectual and physical.
Intellectual Abilities
Intellectual abilities are abilities needed to perform mental activities— thinking,
reasoning, and problem solving. Most societies place a high value on intelligence,
and for good reason. Smart people generally earn more money and attain
higher levels of education. They are also more likely to emerge as leaders of
4 Define intellectual ability
and demonstrate its
relevance to OB.
Ability

Ability 53
groups. Intelligence quotient (IQ) tests, for example, are designed to ascertain
a person’s general intellectual abilities. So, too, are popular college admission
tests, such as the SAT and ACT and graduate admission tests in business
(GMAT), law (LSAT), and medicine (MCAT). Testing firms don’t claim their
tests assess intelligence, but experts know they do. 59 The seven most frequently
cited dimensions making up intellectual abilities are number aptitude, verbal
comprehension, perceptual speed, inductive reasoning, deductive reasoning,
spatial visualization, and memory. 60 Exhibit 2-2 describes these dimensions.
Intelligence dimensions are positively related, so if you score high on verbal
comprehension, for example, you’re more likely to also score high on spatial
visualization. The correlations aren’t perfect, meaning people do have specific
abilities that predict important work-related outcomes when considered
individually. 61 However, they are high enough that researchers also recognize a
general factor of intelligence, general mental ability (GMA) . Evidence strongly
supports the idea that the structures and measures of intellectual abilities
generalize across cultures. Thus, someone in Venezuela or Sudan does not
have a different set of mental abilities than a U.S. or Czech worker. There is
some evidence that IQ scores vary to some degree across cultures, but those
differences are much smaller when we take into account educational and
economic differences. 62
Jobs differ in the demands they place on intellectual abilities. The more
complex a job in terms of information-processing demands, the more general
intelligence and verbal abilities will be necessary to perform successfully. 63
ability An individual’s capacity to
perform the various tasks in a job.
intellectual abilities The capacity
to do mental activities—thinking,
reasoning, and problem solving.
general mental ability (GMA) An
overall factor of intelligence, as
suggested by the positive correlations
among specific intellectual ability
dimensions.
Dimension Description Job Example
Number aptitude Ability to do speedy and accurate Accountant: Computing the sales tax on a set of items
arithmetic
Verbal comprehension Ability to understand what is read Plant manager: Following corporate policies on hiring
or heard and the relationship of
words to each other
Perceptual speed Ability to identify visual similarities Fire investigator: Identifying clues to support a charge of arson
and differences quickly and
accurately
Inductive reasoning Ability to identify a logical sequence Market researcher: Forecasting demand for a product in the
in a problem and then solve the next time period
problem
Deductive reasoning Ability to use logic and assess the Supervisor: Choosing between two different suggestions
implications of an argument offered by employees
Spatial visualization Ability to imagine how an object Interior decorator: Redecorating an office
would look if its position in space
were changed
Memory Ability to retain and recall past Salesperson: Remembering the names of customers
experiences
Dimensions of Intellectual Ability Exhibit 2-2

54 CHAPTER 2 Diversity in Organizations
Where employee behavior is highly routine and there are few or no opportu-
nities to exercise discretion, a high IQ is not as important to performing well.
However, that does not mean people with high IQs cannot have an impact on
traditionally less complex jobs.
It might surprise you that the most widely used intelligence test in hiring
decisions takes only 12 minutes to complete. It’s the Wonderlic Cognitive
Ability Test. There are different forms, and each has 50 questions. Here are a
few examples:
● When rope is selling at $0.10 a foot, how many feet can you buy for $0.60?
● Assume the first two statements are true. Is the final one:
1. True.
2. False.
3. Not certain.
a. The boy plays baseball.
b. All baseball players wear hats.
c. The boy wears a hat.
The Wonderlic measures both speed (almost nobody has time to answer
every question) and power (questions get harder as you go along), so the
A
s e c o n o m i c g l o b a l i z a t i o n
continues to expand, the very
idea of diversity management
must expand to include a diversity
of cultures and situations. Attitudes
toward diversity programs range
greatly across countries, with the
idea of what constitutes a “diverse”
workforce differing by culture and
the demography of the country. The
role of women in the workplace also
varies, with some countries valuing
sexual equality more than others.
Other categories of diversity, like
sexual orientation, are not recognized
in some countries but are important
elements of the diversity picture in
others. A consideration of three inter-
national examples helps illustrate how
diverse diversity programs can be.
In Singapore, diversity has become
part of the national agenda. On “Racial
Harmony Day,” street carnivals are
held to celebrate the nation’s unique
status as a crossroads of Chinese,
Malay, Indian, and other cultures.
Besides applauding these distinct
national identities, the country’s lead-
ers have also prioritized these celebra-
tions as a moment to emphasize the
shared identity of being Singaporean.
Brazil is a similarly diverse country; the
major demographic groups addressed
by Brazilian diversity policies include
African descendant, European descen-
dant, and Asian descendant, as well as
disability status. Research suggests
that diversity programs are relatively
new to Brazil compared to Europe and
North America, but companies are
coming to see diversity management
as a major component of their human
resources systems. In India, diversity
management often means addressing
differences in social class and caste
that do not arise in other countries,
with affirmative action programs man-
dating the number of individuals from
lower castes who must be included in
management positions for some types
of organizations.
Multinational organizations will have
to carefully consider how to create
diversity strategies given the variety
of perspectives on diversity across
countries. Many countries require
specific targets and quotas for achiev-
ing affirmative action goals, whereas
the legal framework in the United
States specifically forbids their use.
Some countries have strong prohibi-
tions on sexual harassment, whereas
in other countries behavior unaccept-
able in U.S. workplaces is common.
Effectively managing diversity in
multinational organizations is clearly a
challenge of the global marketplace.
Sources: Based on D. P. S. Goh, “State
Carnivals and the Subvention of Multi-
culturalism in Singapore,” The British
Journal of Sociology 62 (2011), pp. 111–133;
C. J. C. Jabbour, F. S. Gordono,
J. H. C. de Olivera, J. C. Martinez, and
R. A. G. Battistelle, “Diversity Management:
Challenges, Benefits, and the Role of
Human Resource Management in Brazilian
Organizations,” Equality, Diversity, and
Inclusion: An International Journal 30 (2011),
pp. 58–74; and F. L. Cooke and D. S. Saini,
“Diversity Management in India: A Study of
Organizations in Different Ownership Forms
and Industrial Sectors,” Human Resource
Management 49 (2010), pp. 477–500.
glOBalization!
Images of Diversity from Around the Globe

Ability 55
average score is pretty low—about 21/50. And because it is able to provide valid
information cheaply (for $5 to $10/applicant), more companies are using the
Wonderlic in hiring decisions. The Factory Card & Party Outlet, with 182 stores
nationwide, uses it. So do Subway, Peoples Flowers, Security Alarm, Workforce
Employment Solutions, and many others. Most of these companies don’t give up
other hiring tools, such as application forms or interviews. Rather, they add the
Wonderlic for its ability to provide valid data on applicants’ intelligence levels.
Interestingly, while intelligence is a big help in performing a job well, it
doesn’t make people happier or more satisfied with their jobs. The correlation
between intelligence and job satisfaction is about zero. Why? Research suggests
that although intelligent people perform better and tend to have more interest-
ing jobs, they are also more critical when evaluating their job conditions. Thus,
smart people have it better, but they also expect more. 64
Physical Abilities
Though the changing nature of work suggests intellectual abilities are in-
creasingly important for many jobs, physical abilities have been and will
remain valuable. Research on hundreds of jobs has identified nine basic
abilities needed in the performance of physical tasks. 65 These are described
in Exhibit 2-3 . Individuals differ in the extent to which they have each of
these abilities. Not surprisingly, there is also little relationship among them:
a high score on one is no assurance of a high score on others. High employee
performance is likely to be achieved when management has ascertained the
extent to which a job requires each of the nine abilities and then ensures that
employees in that job have those abilities.
5 Contrast intellectual and
physical ability.

Nine Basic Physical Abilities Exhibit 2-3
Strength Factors
1. Dynamic strength Ability to exert muscular force repeatedly or continuously
over time
2. Trunk strength Ability to exert muscular strength using the trunk
(particularly abdominal) muscles
3. Static strength Ability to exert force against external objects
4. Explosive strength Ability to expend a maximum of energy in one or a series of
explosive acts
Flexibility Factors
5. Extent flexibility Ability to move the trunk and back muscles as far as possible
6. Dynamic flexibility Ability to make rapid, repeated flexing movements
Other Factors
7. Body coordination Ability to coordinate the simultaneous actions of different
parts of the body
8. Balance Ability to maintain equilibrium despite forces pulling off
balance
9. Stamina Ability to continue maximum effort requiring prolonged
effort over time
physical abilities The capacity to do
tasks that demand stamina, dexterity,
strength, and similar characteristics.

56 CHAPTER 2 Diversity in Organizations
The Role of Disabilities
The importance of ability at work obviously creates problems when we attempt
to formulate workplace policies that recognize diversity in terms of disability
status. As we have noted, recognizing that individuals have different abilities
that can be taken into account when making hiring decisions is not problematic.
However, it is discriminatory to make blanket assumptions about people on the
basis of a disability. It is also possible to make accommodations for disabilities.
Having discussed a variety of ways in which people differ, we now look at how
a manager can and should manage these differences. Diversity management
makes everyone more aware of and sensitive to the needs and differences of
others. This definition highlights the fact that diversity programs include and
are meant for everyone. Diversity is much more likely to be successful when we
see it as everyone’s business than if we believe it helps only certain groups of
employees.
Attracting, Selecting, Developing,
and Retaining Diverse Employees
One method of enhancing workforce diversity is to target recruiting messages to
specific demographic groups underrepresented in the workforce. This means
placing advertisements in publications geared toward specific demographic
groups; recruiting at colleges, universities, and other institutions with significant
numbers of underrepresented minorities; and forming partnerships with
associations like the Society for Women Engineers or the Graduate Minority
Business Association. These efforts can be successful, and research has shown
that women and minorities do have greater interest in employers that make
special efforts to highlight a commitment to diversity in their recruiting
materials. Advertisements depicting groups of diverse employees are seen as
more attractive to women and racioethnic minorities, which is probably why
most organizations depict workforce diversity prominently in their recruiting
materials. Diversity advertisements that fail to show women and minorities
in positions of organizational leadership send a negative message about the
diversity climate at an organization. 66
The selection process is one of the most important places to apply diversity
efforts. Managers who hire need to value fairness and objectivity in selecting
employees and focus on the productive potential of new recruits. Fortunately,
ensuring that hiring is bias-free does appear to work. Where managers use
a well-defined protocol for assessing applicant talent and the organization
clearly prioritizes nondiscrimination policies, qualifications become far more
important in determining who gets hired than demographic characteristics. 67
Organizations that do not discourage discriminatory behavior are more likely
to see problems.
Similarity in personality appears to affect career advancement. Those whose
personality traits are similar to those of their co-workers are more likely to be
promoted than those whose personalities are different. 68 There’s an important
qualifier to these results: in collectivistic cultures, similarity to supervisors is
more important for predicting advancement, whereas in individualistic cultures,
MyManagementLab
For an interactive application of this
topic, check out this chapter’s
simulation activity at
www.mymanagementlab.com.
Implementing Diversity Management Strategies

www.mymanagementlab.com

Implementing Diversity Management Strategies 57
similarity to peers is more important. Once again, deep-level diversity factors
appear to be more important in shaping people’s reactions to one another than
surface-level characteristics.
Evidence from a study of more than 6,000 workers in a major retail organi-
zation indicated that in stores with a less supportive diversity climate, African
Americans or Hispanics made significantly fewer sales than White employees,
but when the diversity climate was positive, Hispanics and Whites sold about the
same amount and African Americans made more sales than Whites. 69 Whites
sold about the same amount whether there was a positive diversity climate or
not, but African Americans and Hispanics sold far more when there was. There
are obvious bottom-line implications of this research: stores that fostered a
positive diversity climate were able to capitalize on their diverse workforce and
make more money.
Some data suggest individuals who are demographically different from their
co-workers are more likely to feel low commitment and to turn over: women are
more likely to turn over from predominantly male work groups and men from
predominantly female work groups; non-Whites are more likely to turn over
from predominantly White work groups and Whites from predominantly non-
White work groups. 70 However, this behavior is more prominent among new
hires. After people become better acquainted with one another, demographic
differences are less consistently related to turnover. One very large-scale study
showed a positive diversity climate was related to higher organizational commit-
ment and lower turnover intentions among African-American, Hispanic, and
White managers. 71 In other words, all workers appeared to prefer an organiza-
tion that values diversity.
In Japan, Nissan Motor Company
is helping female employees
develop their careers at the
firm’s manufacturing plants and
car dealerships. Nissan provides
women, such as the assembly-line
worker shown here, with training
programs to develop skills and the
one-on-one counseling services of
career advisors. Nissan also posts
career interviews on its corporate
intranet with women who have
made significant contributions
to the company and serve as role
models for other female employees.
For Nissan, developing the talents
of women is a strategic imperative
for its business success.
diversity management The process
and programs by which managers
make everyone more aware of and
sensitive to the needs and differences
of others.
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58 CHAPTER 2 Diversity in Organizations
Diversity in Groups
Most contemporary workplaces require extensive work in group settings. When
people work in groups, they need to establish a common way of looking at
and accomplishing the major tasks, and they need to communicate with one
another often. If they feel little sense of membership and cohesion in their
groups, all these group attributes are likely to suffer.
Does diversity help or hurt group performance? The answer is “yes.” In
some cases, diversity in traits can hurt team performance, whereas in others it
can facilitate it. 72 Whether diverse or homogeneous teams are more effective
depends on the characteristic of interest. Demographic diversity (in gender,
race, and ethnicity) does not appear to either help or hurt team performance
in general. On the other hand, teams of individuals who are highly intelligent,
conscientious, and interested in working in team settings are more effective.
Thus diversity on these variables is likely to be a bad thing—it makes little sense
to try to form teams that mix in members who are lower in intelligence, consci-
entiousness, and uninterested in teamwork. In other cases, differences can be a
strength. Groups of individuals with different types of expertise and education
are more effective than homogeneous groups. Similarly, a group made entirely
of assertive people who want to be in charge, or a group whose members all
prefer to follow the lead of others, will be less effective than a group that mixes
leaders and followers.
Regardless of the composition of the group, differences can be leveraged
to achieve superior performance. The most important way is to emphasize the
higher-level similarities among members. 73 In other words, groups of diverse
individuals will be much more effective if leaders can show how members have
a common interest in the group’s success. Evidence also shows transformational
leaders (who emphasize higher-order goals and values in their leadership style)
are more effective in managing diverse teams. 74
Effective Diversity Programs
Organizations use a variety of efforts to capitalize on diversity, including the
recruiting and selection policies we have already discussed, as well as training
and development practices. Effective, comprehensive workforce programs
encouraging diversity have three distinct components. First, they teach
managers about the legal framework for equal employment opportunity
and encourage fair treatment of all people regardless of their demographic
characteristics. Second, they teach managers how a diverse workforce will be
better able to serve a diverse market of customers and clients. Third, they foster
personal development practices that bring out the skills and abilities of all
workers, acknowledging how differences in perspective can be a valuable way to
improve performance for everyone. 75
Much concern about diversity has to do with fair treatment. 76 Most negative
reactions to employment discrimination are based on the idea that discrimina-
tory treatment is unfair. Regardless of race or gender, people are generally in
favor of diversity-oriented programs, including affirmative action, if they believe
the policies ensure everyone a fair opportunity to show their skills and abilities.
A major study of the consequences of diversity programs came to what might
seem a surprising conclusion. 77 Organizations that provided diversity train-
ing were not consistently more likely to have women and minorities in upper
management positions than organizations that did not. On closer examination
though, these results are not surprising. Experts have long known that one-shot
training sessions without strategies to encourage effective diversity manage-
ment back on the job are not likely to be very effective. Some diversity programs
6 Describe how organizations
manage diversity effectively.

Implementing Diversity Management Strategies 59
are truly effective in improving representation in management. They include
strategies to measure the representation of women and minorities in managerial
positions, and they hold managers accountable for achieving more demograph-
ically diverse management teams. Researchers also suggest that diversity expe-
riences are more likely to lead to positive adaptation for all parties if (1) the
diversity experience undermines stereotypical attitudes, (2) if the perceiver is
motivated and able to consider a new perspective on others, (3) if the perceiver
engages in stereotype suppression and generative thought in response to the
diversity experience, and (4) if the positive experience of stereotype undermin-
ing is repeated frequently. 78 Diversity programs based on these principles are
likely to be more effective than traditional classroom learning.
Organizational leaders should examine their workforce to determine
whether target groups have been underutilized. If groups of employees are
not proportionally represented in top management, managers should look
for any hidden barriers to advancement. They can often improve recruiting
practices, make selection systems more transparent, and provide training for
those employees who have not had adequate exposure to certain material
in the past. The organization should also clearly communicate its policies to
employees so they can understand how and why certain practices are followed.
Communications should focus as much as possible on qualifications and job
performance; emphasizing certain groups as needing more assistance could
well backfire. A case study of the multinational Finnish company TRANSCO
found it was possible to develop a consistent global philosophy for diversity
management. However, differences in legal and cultural factors across nations
forced TRANSCO to develop unique policies to match the cultural and legal
frameworks of each country in which it operated. 79
To ensure the top-level management team represents the diversity of its work-
force and client base, Safeway implemented the Retail Leadership Development
(RLD) Program, a formal career development program. This program is open
to all employees, so it is inclusive, but women and underrepresented racial or
ethnic groups are particularly encouraged to participate. Interested individu-
als take a series of examinations to determine whether they have management
potential. Those who perform well on the tests are provided with work in roles
that expose them to managerial opportunities. The program’s comprehensive
nature is underscored by its additional support activities: All managers attend
NASCAR, an American sport with
a worldwide following, promotes
diversity within its organization
and throughout the motorsports
industry. Through its Drive to
Diversity program, NASCAR ensures
that everyone is given a fair
opportunity to show and develop
his or her skills and abilities. The
program seeks to develop minority
and female drivers and crew
members as shown in this photo.
Drivers participate in a scouting
combine and earn the chance
to compete with an established
NASCAR team for a full season. And
after completing their training,
crew member trainees can compete
with a racing team.
So
u
rc
e
: C
h
u
ck
B
u
rt
o
n
/A
P
I
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a
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s

60 CHAPTER 2 Diversity in Organizations
workshops that help them bring diversity concerns front and center in their
staff meetings. They are also charged with providing promising RLD partici-
pants with additional training and development opportunities to ensure they
have the skills needed for advancement. The program incorporates the type
of accountability we have said is crucial to the success of diversity efforts; per-
formance bonuses are provided to managers who meet concrete diversity
goals. This program has shown real success: the number of White women store
managers has increased by 31 percent since its inception, and the number of
women-of-color store managers has increased by 92 percent. 80
MyManagementLab
Now that you have finished this chapter, go back to www.mymanagementlab.com to continue
practicing and applying the concepts you’ve learned.
This chapter looked at diversity from many perspectives. We paid particular
attention to three variables—biographical characteristics, ability, and diversity
programs. Let’s summarize what we found and consider its importance for a
manager trying to understand organizational behavior.
● We can readily observe biographical characteristics, but that doesn’t
mean we should explicitly use them in management decisions. Most
research shows fairly minimal effects of biographical characteristics on
job performance. We also need to be aware of implicit biases we or other
managers may have.
● An effective selection process will improve the fit between employees
and job requirements. A job analysis will provide information about jobs
currently being done and the abilities individuals need to perform the
jobs adequately. Applicants can then be tested, interviewed, and evaluated
on the degree to which they possess the necessary abilities.
● Promotion and transfer decisions affecting individuals already in the orga-
nization’s employ should reflect candidates’ abilities. As with new employ-
ees, care should be taken to assess critical abilities incumbents will need
in the job and match those with the organization’s human resources.
● To accommodate employees with disabilities, managers can improve the
fit by fine-tuning the job to better match an incumbent’s abilities. Often,
modifications with no significant impact on the job’s basic activities, such
as changing equipment or reorganizing tasks within a group, can better
adapt work to the specific talents of a given employee.
● Diversity management must be an ongoing commitment that crosses all
levels of the organization. Group management, recruiting, hiring, reten-
tion, and development practices can all be designed to leverage diversity
for the organization’s competitive advantage.
● Policies to improve the climate for diversity can be effective, so long as
they are designed to acknowledge all employees’ perspectives. One-shot
diversity training sessions are less likely to be effective than comprehen-
sive programs that address the climate for diversity at multiple levels.
Summary and Implications for Managers

www.mymanagementlab.com

Summar y and Implications for Managers 61
Men Have More Mathematical Ability Than Women
POINT COUNTERPOINT
W
omen make up about half the new entrants in the
professions of law, medicine, and dentistry. They are
the vast majority of veterinarians. Yet they remain
woefully underrepresented in science, mathematics, and tech-
nology positions. For example, only about one in five of recent
entrants into engineering graduate programs are women, and
in natural sciences and computer science departments at the
top universities, fewer than one in ten tenured professors are
women. If women are at such a disadvantage in terms of math
and science abilities, why are they better represented in some
occupations than others? Differing motivations produced by
teacher and parent expectations are the answer. If we think
women aren’t natural engineers, then we learn to steer girls
away from such career choices.
It is true there are gender differences in math test scores,
but those differences are not large. And often ignored is a
widely documented phenomenon: among the very young,
girls outperform boys on math (as well as on other) tests. By
adolescence, this advantage reverses and boys outperform
girls. If socialization and school experiences do not explain this
result, what does?
Moreover, we know that a large part of the reason fewer
women enter science, technology, engineering, and mathe-
matical (STEM) positions is not ability but motivation. Research
indicates that women perceive careers in STEM fields to be
less interpersonally fulfilling, and this explains their gravitation
toward other fields. If we are concerned about sex differences
in participation in these fields, we need to be concerned with
the motivational effects of these perceptions, not with any
presumed differences in male and female abilities.
H
arvard’s Larry Summers was forced to resign from
his job as president of the university for claiming that
women have different abilities than men, but there is
some truth to the claim. Evidence reliability indicates significant
gender differences in mathematical test scores.
To be sure, there are many, many women whose mathemati-
cal and scientific prowess far surpasses that of many men. The
distributions overlap to a considerable degree.
It is also true that most research shows that overall intel-
ligence doesn’t differ between genders: women are as smart
as men. But the fact of the matter is, the way in which men and
women are smart is, on average, different. Women tend to have
significantly higher scores on verbal ability measures and men
tend to have significantly higher scores on measures of math-
ematical ability.
Many sociologists and educational psychologists argue
that these differences are explained by socialization: boys are
socialized toward and rewarded for mathematical prowess,
whereas girls are pointed toward and expected to excel in writ-
ing and reading.
These socialization arguments, however, ignore some cold,
hard truths that have been uncovered in the latest research. We
know from neural imaging research that men’s and women’s
brains differ. Men tend to show higher activation in the area
of the brain responsible for mathematical and for spatial
operations. Women, in contrast, tend to have better bilateral
communication (the right and left sides of their brain communi-
cate better), which is vital to reading comprehension and writ-
ten and oral expression. Do we really think a child’s third-grade
teacher caused these differences?
No reasonable person suggests that boys and girls should
be steered into different occupations based on these findings.
Men and women should pursue the occupations that suit their
abilities and that they will find rewarding. But should our pursuit
of egalitarianism blind us to scientific findings that suggest the
obvious: men and women are not exactly alike?
Sources: Based on A. B. Diekman, E. R. Brown, A. M. Johnston, and E. K. Clark, “Seeking Congruity between Goals and Roles:
A New Look at Why Women Opt Out of Science, Technology, Engineering, and Mathematics Careers,” Psychological Science
21, no. 8 (2010), pp. 1051–1057; S. J. Ceci and W. Williams, “Sex Differences in Math-Intensive Fields,” Current Directions
in Psychological Science 19, no. 5 (2010), pp. 275–279; and J. Tierney, “Legislation Won’t Close Gender Gap in Sciences,”
The New York Times (June 14, 2010), pp. 1–4.

62 CHAPTER 2 Diversity in Organizations
1 What are the two major forms of workforce diversity?
2 What are stereotypes and how do they function in
organizational settings?
3 What are the key biographical characteristics and how
are they relevant to OB?
4 What is intellectual ability and how is it relevant to OB?
5 How can you contrast intellectual and physical ability?
6 How do organizations manage diversity effectively?
QUESTIONS FOR REVIEW
EXPERIENTIAL EXERCISE Feeling Excluded
This six-step exercise takes approximately 20 minutes.
Individual Work (Steps 1 and 2)
1. All participants are asked to recall a time when they have
felt uncomfortable or targeted because of their demo-
graphic status. Ideally, situations at work should be used,
but if no work situations come to mind, any situation
will work. Encourage students to use any demographic
characteristic they think is most appropriate, so they can
write about feeling excluded on the basis of race, ethnic-
ity, gender, age, disability status, religion, or any other
characteristic. They should briefly describe the situation,
what precipitated the event, how they felt at the time,
how they reacted, and how they believe the other party
could have made the situation better.
2. The instructor asks the students to then think about a
time when they might have either deliberately or acci-
dentally done something that made someone else feel
excluded or targeted because of their demographic
status. Once again, they should briefly describe the
situation, what precipitated the event, how they felt at
the time, how the other person reacted, and how they
could have made the situation better.
Small Groups (Steps 3 and 4)
3. Once everyone has written their descriptions, divide
the class into small groups of not more than four
people. If at all possible, try to compose groups that
are somewhat demographically diverse, to avoid
intergroup conflicts in the class review discussion.
Students should be encouraged to discuss their
situations and consider how their experiences were
similar or different.
4. After reading through everyone’s reactions, each
group should develop a short list of principles for
how they personally can avoid excluding or targeting
people in the future. Encourage them to be as
specific as possible, and also ask each group to find
solutions that work for everyone. Solutions should
focus on both avoiding these situations in the first
place and resolving them when they do occur.
Class Review (Steps 5 and 6)
5. Members of each group are invited to provide a very
brief summary of the major principles of how they’ve
felt excluded or targeted, and then to describe their
groups’ collective decisions regarding how these
situations can be minimized in the future.
6. The instructor should lead a discussion on how
companies might be able to develop comprehensive
policies that will encourage people to be sensitive in
their interactions with one another.
ETHICAL DILEMMA Board Quotas
That women are underrepresented on boards of directors
is an understatement. In the United States, only 15 percent
of board members among the Fortune 500 are women.
Among the 100 largest companies in Great Britain, women
hold approximately 12 percent of board seats, a represen-
tation that has changed little over the past 5 years. In the
European Union (EU) more generally, only 9.7 percent of
the directors of the 300 largest companies are women. In
China and India, the figure is roughly half that.
In response to such underrepresentation, many EU
countries—including France, Spain, and Norway—have
instituted compulsory quotas for female representation on
boards. Great Britain has guidelines and recommendations.
A 2011 official British government report recommended
that women make up at least 25 percent of the boards of
the largest British companies. Under the recommended
guidelines, companies would be required to announce
their board composition goals to their shareholders and
state clearly how they plan on meeting them. France passed
a law in 2011 that requires large companies to fill at least
40 percent of board seats with female members within the
next six years. Spain has a similar quota in place.

Case Incident 1 63
Questions
1. Given that women participate in the labor force
in roughly the same proportion as men, why do
you think women occupy so few seats on boards
of directors?
2. Do you agree with the quotas established in many EU
countries? Why or why not?
3. Beyond legal remedies, what do you think can be
done to increase women’s representations on boards
of directors?
4. One recent study found no link between female repre-
sentation on boards of directors and these companies’
corporate sustainability or environmental policies. The
study’s author expressed surprise at the findings. Do
the findings surprise you? Why or why not?
Sources: J. Werdigier, “In Britain, a Push for More Women on Boards of Large Companies,” The New York
Times (February 25, 2011), p. B3; and J. Galbreath, “Are There Gender-Related Influences on Corporate
Sustainability? A Study of Women on Boards of Directors,” Journal of Management & Organization 17,
no. 1 (2011), pp. 17–38.
CASE INCIDENT 1 The Flynn Effect
Given that a substantial amount of intellectual ability is
inherited, it might surprise you to learn that intelligence test
scores are rising. In fact, scores have risen so dramatically
that today’s great-grandparents seem mentally deficient by
comparison. First, let’s review the evidence for rising test
scores. Then we’ll review explanations for the results.
On an IQ scale where 100 is the average, scores have
been rising about 3 points per decade, meaning if your
grandparent scored 100, the average score for your
generation would be around 115. That’s a pretty big
difference—about a standard deviation, meaning someone
from your grandparent’s generation whose score was at the
84th percentile would be only average (50th percentile) by
today’s norms.
James Flynn is a New Zealand researcher credited
with first documenting the rising scores. He reported the
results in 1984, when he found that almost everyone who
took a well-validated IQ test in the 1970s did better than
those who took one in the 1940s. The results appear to
hold up across cultures. Test scores are rising not only in
the United States but in most other countries in which the
effect has been tested, too.
What explains the Flynn effect? Researchers are not
entirely sure, but some of the explanations offered are these:
1. Education. Students today are better educated than
their ancestors, and education leads to higher test scores.
2. Smaller families. In 1900, the average couple had
four children; today the number is fewer than two. We
know firstborns tend to have higher IQs than other
children, probably because they receive more atten-
tion than their later-born siblings.
3. Test-taking savvy. Today’s children have been tested
so often that they are test-savvy: they know how to take
tests and how to do well on them.
4. Genes. Although smart couples tend to have fewer,
not more, children (which might lead us to expect
intelligence in the population to drop over time), it’s
possible that due to better education, tracking, and
testing, those who do have the right genes are better
able to exploit those advantages. Some genetics
researchers also have argued that if genes for intel-
ligence carried by both parents are dominant, they
win out, meaning the child’s IQ will be as high as or
higher than those of the parents.
Despite the strong heritability of IQ, researchers con-
tinue to pursue mechanisms that might raise IQ scores.
Factors like brain exercises (even video games) and reg-
ular physical exercise seem to at least temporarily boost
brain power. Other recent research in neuroscience has
had difficulty pinpointing physical mechanisms that can
lead to a boost in IQ, although researchers propose that a
focus on brain chemicals like dopamine may lead, in time,
to drugs that can boost IQ chemically.
Questions
1. Do you believe people are really getting smarter? Why
or why not?
2. Which of the factors explaining the Flynn effect do
you accept?
3. If the Flynn effect is true, does this undermine the
theory that IQ is mostly inherited? Why or why not?
Sources: Based on S. Begley, “Sex, Race, and IQ: Off Limits?” Newsweek (April 20, 2009), www.newsweek
.com ; M. A. Mingroni, “Resolving the IQ Paradox: Heterosis as a Cause of the Flynn Effect and Other
Trends,” Psychological Review (July 2007), pp. 806–829; and S. Begley, “Can You Build a Better Brain?”
Newsweek (January 10, 2011), www.newsweek.com .

www.newsweek.com

64 CHAPTER 2 Diversity in Organizations
CASE INCIDENT 2 Increasing Age Diversity in the Workplace
Over the past century, the average age of the workforce
has continually increased as medical science continues
to enhance longevity and vitality. The fastest-growing
segment of the workforce is individuals over the age of 55.
Recent medical research is exploring techniques that
could extend human life to 100 years or more. In addition,
the combination of laws prohibiting age discrimination
and elimination of defined-benefit pension plans means
that many individuals continue to work well past the tradi-
tional age of retirement.
Unfortunately, older workers face a variety of
discriminatory attitudes in the workplace. Researchers
scanned more than 100 publications on age discrimination
to determine what types of age stereotypes were most
prevalent across studies. They found that stereotypes
suggested job performance declined with age, counter to
empirical evidence presented earlier in this chapter that
relationships between age and core task performance are
essentially nil. Stereotypes also suggest that older workers
are less adaptable, less flexible, and incapable of learning
new concepts. Research, on the other hand, suggests they
are capable of learning and adapting to new situations
when these are framed appropriately.
Organizations can take steps to limit age discrimination
and ensure that employees are treated fairly regardless of
age. Many of the techniques to limit age discrimination
come down to fundamentally sound management practices
relevant for all employees: set clear expectations for
performance, deal with problems directly, communicate
with workers frequently, and follow clear policies and
procedures consistently. In particular, management
professionals note that clarity and consistency can help
ensure all employees are treated equally regardless of age.
Questions
1. What changes in employment relationships are likely
to occur as the population ages?
2. Do you think increasing age diversity will create new
challenges for managers? What types of challenges do
you expect will be most profound?
3. How can organizations cope with differences related
to age discrimination in the workplace?
4. What types of policies might lead to charges of age
discrimination, and how can they be changed to
eliminate these problems?
Sources: Based on D. Stipp, “The Anti-Aging Revolution,” Fortune (June 14, 2010), pp. 124–130;
R. A. Posthuma and M. A. Campion, “Age Stereotypes in the Workplace: Common Stereotypes, Moderators,
and Future Research Directions,” Journal of Management 35 (2009), pp. 158–188; and H. Perlowski, “With
an Aging Workforce, a Rising Risk of Discrimination Claims,” Workforce Management Online (July 2008),
www.workforce.com .
ENDNOTES
1. M. DiNatale and S. Boraas, “The Labor Force Experience of
Women from Generation X,” Monthly Labor Review (March
2002), pp. 1–15.
2. See, for example, F. Welch, “Catching Up: Wages of Black
Men,” The American Economic Review 93, no. 2 (2003),
pp. 320–325; A. Sakamoto, H. Wu, and J. M. Tzeng,
“The Declining Significance of Race Among American
Men During the Latter Half of the Twentieth Century,”
Demography 37 (January 2000), pp. 41–51; and A Sakomoto,
K. A. Goyette, and C. Kim, “Socioeconomic Attainments
of Asian Americans,” Annual Review of Sociology 35, (2009),
pp. 255–276.
3. J. Schram, SHRM Workplace Forecast (Alexandria, VA: Society
for Human Resource Management, 2006).
4. D. A. Harrison, K. H. Price, J. H. Gavin, and A. T. Florey,
“Time, Teams, and Task Performance: Changing Effects of
Surface- and Deep-Level Diversity on Group Functioning,”
Academy of Management Journal 45, no. 5 (2002), pp. 1029–1045;
and A. H. Eagly and J. L. Chin, “Are Memberships in
Race, Ethnicity, and Gender Categories Merely Surface
Characteristics?” American Psychologist 65 (2010), pp. 934–935.
5. P. Chattopadhyay, M. Tluchowska, and E. George,
“Identifying the Ingroup: A Closer Look at the Influence
of Demographic Dissimilarity on Employee Social Identity,”
Academy of Management Review 29, no. 2 (2004), pp. 180–202;
and P. Chattopadhyay, “Beyond Direct and Symmetrical
Effects: The Influence of Demographic Dissimilarity on
Organizational Citizenship Behavior,” Academy of Management
Journal 42, no. 3 (1999), pp. 273–287.
6. L. M. Cortina, “Unseen Injustice: Incivility as Modern
Discrimination in Organizations,” Academy of Management
Review 33, no. 1 (2008), pp. 55–75.
7. R. J. Grossman, “Keep Pace with Older Workers,” HR
Magazine (May 2008), pp. 39–46.
8. K. A. Wrenn and T. J. Maurer, “Beliefs About Older Workers’
Learning and Development Behavior in Relation to Beliefs
About Malleability of Skills, Age-Related Decline, and
Control,” Journal of Applied Social Psychology 34, no. 2 (2004),
pp. 223–242; and R. A. Posthuma and M. A. Campion,
“Age Stereotypes in the Workplace: Common Stereotypes,

www.workforce.com

Endnotes 65
M. Wooden, “Do Explanations of Absenteeism Differ for
Men and Women?” Human Relations (November 1995),
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24. See, for instance, M. Tait, M. Y. Padgett, and T. T. Baldwin,
“Job and Life Satisfaction: A Reevaluation of the Strength
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the Date of the Study,” Journal of Applied Psychology (June
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(September 6, 1999), pp. 202–208.
25. S. Halrynjo, “Men’s Work-Life Conflict: Career, Care and
Self-Realization: Patterns of Privileges and Dilemmas,”
Gender, Work & Organization 16, no. 1 (2009), pp. 98–125;
and S. Jayson, “Gender Roles See a ‘Conflict’ Shift,” USA
Today (March 26, 2009), p. 1A.
26. M. E. Heilman and T. G. Okimoto, “Motherhood: A Potential
Source of Bias in Employment Decisions,” Journal of Applied
Psychology 93, no. 1 (2008), pp. 189–198.
27. J. L. Raver and L. H. Nishii, “Once, Twice, or Three Times
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28. D. R. Avery, J. A. Richeson, M R. Hebl, and N. Ambady, “It
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30. D. A. Kravitz, D. M. Mayer, L. M. Leslie, and D. Lev-Arey,
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31. D. R. Avery, P F. McKay, and D. C. Wilson “What Are the
Odds? How Demographic Similarity Affects the Prevalence
of Perceived Employment Discrimination,” Journal of Applied
Psychology 93 (2008), pp. 235–249.
32. J. M. Sacco, C. R. Scheu, A. M. Ryan, and N. Schmitt, “An
Investigation of Race and Sex Similarity Effects in Interviews:
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of Applied Psychology 88, no. 5 (2003), pp. 852–865; and
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(2006), pp. 538–554.
33. P. Bobko, P. L. Roth, and D. Potosky, “Derivation and
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35. W. T. Dickens and J. R. Flynn, “Black Americans Reduce the
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9. T. W. H. Ng and D. C. Feldman, “Re-examining the
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10. T. W. H. Ng and D. C. Feldman, “The Relationship of Age
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11. Cited in K. Labich, “The New Unemployed,” Fortune
(March 8, 1993), p. 43.
12. See Ng and Feldman, “The Relationship of Age to Ten
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with Job Attitudes: A Meta-Analysis,” Personnel Psychology 63
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14. K. M. Kacmar and G. R. Ferris, “Theoretical and
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W. W. Fleischhacker, and M. Delazer, “Sex Differences in
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18. M. E. Heilman and T. G. Okimoto, “Why Are Women Penalized
for Success at Male Tasks? The Implied Communality Deficit,”
Journal of Applied Psychology 92, no. 1 (2007), pp. 81–92.
19. D. R. Avery, P F. McKay, and D. C. Wilson “What are the
Odds? How Demographic Similarity Affects the Prevalence
of Perceived Employment Discrimination,” Journal of Applied
Psychology 93 (2008), pp. 235–249.
20. C. Kirchmeyer, “The Different Effects of Family on Objective
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You Sacrifice? Access to Top Management and the Work-
Life Balance,” Gender, Work & Organization 16, no. 1 (2009),
pp. 14–36.
21. Guillaume and Pochic, “What Would You Sacrifice? Access
to Top Management and the Work-Life Balance.”
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Conventional Wisdom About Who Quits: Revelations from
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(2008), pp. 1–34.
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Differences in Absenteeism,” Public Personnel Management
(Summer 1990), pp. 229–253; and A. VandenHeuvel and

66 CHAPTER 2 Diversity in Organizations
47. T. W. H. Ng and D. C. Feldman, “Organizational Tenure
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53. M. Elias, “USA’s Muslims Under a Cloud,” USA Today
(August 10, 2006), pp. 1D, 2D; and R. R. Hastings, “Muslims
Seek Acknowledgement of Mainstream Americans,” HRWeek
(May 11, 2007), p. 1.
54. E. B. King and A. S. Ahmad, “An Experimental Field
Study of Interpersonal Discrimination Toward Muslim Job
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55. See, for example, E. B. King and J. M. Cortina, “The Social
and Economic Imperative of Lesbian, Gay, Bisexual, and
Transgendered Supportive Organizational Policies,”
Industrial and Organizational Psychology: Perspectives on Science
and Practice 3 (2010), pp. 69–78.
56. HRC Corporate Equality Index, 2011, www.hrc.org/documents/
HRC-CEI-2011-Final ; and R. R. Hastings, “Necessity
Breeds Inclusion: Reconsidering ‘Don’t Ask, Don’t Tell,’”
HRWeek (January 2007), pp. 1–2.
57. B. R. Ragins, “Disclosure Disconnects: Antecedents and
Consequences of Disclosing Invisible Stigmas Across Life
Domains,” Academy of Management Review 33 (2008), pp. 194–215.
58. B. Leonard, “Transgender Issues Test Diversity Limits,”
HRMagazine (June 2007), pp. 32–34.
59. L. S. Gottfredson, “The Challenge and Promise of Cognitive
Career Assessment,” Journal of Career Assessment 11, no. 2
(2003), pp. 115–135.
60. M. D. Dunnette, “Aptitudes, Abilities, and Skills,” in
M. D. Dunnette (ed.), Handbook of Industrial and Organizational
Psychology (Chicago: Rand McNally, 1976), pp. 478–483.
61. J. W. B. Lang, M. Kersting, U. R. Hülscheger, and J. Lang,
“General Mental Ability, Narrower Cognitive Abilities, and
Job Performance: The Perspective of the Nested-Factors
Model of Cognitive Abilities” Personnel Psychology 63 (2010),
pp. 595–640.
62. N. Barber, “Educational and Ecological Correlates of IQ: A
Cross-National Investigation,” Intelligence (May–June 2005),
pp. 273–284.
63. J. F. Salgado, N. Anderson, S. Moscoso, C. Bertua, F. de Fruyt,
and J. P. Rolland, “A Meta-analytic Study of General Mental
Psychological Science 17 (2006), pp. 913–920; and C. Murray,
“The Magnitude and Components of Change in the Black-
White IQ Difference from 1920 to 1991: A Birth Cohort
Analysis of the Woodcock-Johnson Standardizations,”
Intelligence 35, no. 44 (2007), pp. 305–318.
36. See J. P. Rushton and A. R. Jenson, “Thirty Years of Research
on Race Differences in Cognitive Ability,” Psychology, Public
Policy, and the Law 11, no. 2 (2005), pp. 235–295; and
R. E. Nisbett, “Heredity, Environment, and Race Differences in
IQ: A Commentary on Rushton and Jensen (2005),” Psychology,
Public Policy, and the Law 11, no. 2 (2005), pp. 302–310.
37. Avery, McKay, and Wilson, “What Are the Odds? How
Demographic Similarity Affects the Prevalence of Perceived
Employment Discrimination”; and Raver and Nishii, “Once,
Twice, or Three Times as Harmful? Ethnic Harassment, Gender
Harassment, and Generalized Workplace Harassment.”
38. P. F. McKay, D. R. Avery, and M. A. Morris, “Mean Racial-
Ethnic Differences in Employee Sales Performance: The
Moderating Role of Diversity Climate,” Personnel Psychology
61, no. 2 (2008), pp. 349–374.
39. Americans with Disabilities Act, 42 U.S.C. § 12101, et seq.
(1990).
40. S. G. Goldberg, M. B. Killeen, and B. O’Day, “The Disclosure
Conundrum: How People with Psychiatric Disabilities
Navigate Employment,” Psychology, Public Policy, and Law 11,
no. 3 (2005), pp. 463–500; M. L. Ellison, Z. Russinova,
K. L. MacDonald-Wilson, and A. Lyass, “Patterns and
Correlates of Workplace Disclosure Among Professionals
and Managers with Psychiatric Conditions,” Journal of
Vocational Rehabilitation 18, no. 1 (2003), pp. 3–13.
41. L. R. Ren, R. L. Paetzold, and A. Colella, “A Meta-Analysis of
Experimental Studies on the Effects of Disability on Human
Resource Judgments,” Human Resource Management Review
18, no. 3 (2008), pp. 191–203.
42. S. Almond and A. Healey, “Mental Health and Absence
from Work: New Evidence from the UK Quarterly Labour
Force Survey,” Work, Employment, and Society 17, no. 4 (2003),
pp. 731–742.
43. E. Louvet, “Social Judgment Toward Job Applicants
with Disabilities: Perception of Personal Qualities and
Competences,” Rehabilitation Psychology 52, no. 3 (2007),
pp. 297–303; and W. D. Gouvier, S. Sytsma-Jordan, and
S. Mayville, “Patterns of Discrimination in Hiring Job
Applicants with Disabilities: The Role of Disability Type, Job
Complexity, and Public Contact,” Rehabilitation Psychology 48,
no. 3 (2003), pp. 175–181.
44. A. Colella, A. S. DeNisi, and A. Varma, “The Impact of
Ratee’s Disability on Performance Judgments and Choice
as Partner: The Role of Disability-Job Fit Stereotypes and
Interdependence of Rewards,” Journal of Applied Psychology
83, no. 1 (1998), pp. 102–111.
45. J. M. Czajka and A. S. DeNisi, “Effects of Emotional Disability
and Clear Performance Standards on Performance Ratings,”
Academy of Management Journal 31, no. 2 (1988), pp. 394–404.
46. B. S. Bell and K. J. Klein, “Effect of Disability, Gender,
and Job Level on Ratings of Job Applicants,” Rehabilitation
Psychology 46, no. 3 (2001), pp. 229–246; and Louvet,
“Social Judgment Toward Job Applicants with Disabilities:
Perception of Personal Qualities and Competences.”

www.hrc.org/documents/HRC-CEI-2011-Final

Endnotes 67
72. S. T. Bell, “Deep-Level Composition Variables as Predictors
of Team Performance: A Meta–Analysis,” Journal of Applied
Psychology 92, no. 3 (2007), pp. 595–615; S. K. Horwitz and
I. B. Horwitz, “The Effects of Team Diversity on Team
Outcomes: A Meta-Analytic Review of Team Demography,”
Journal of Management 33, no. 6 (2007), pp. 987–1015;
G. L. Stewart, “A Meta-Analytic Review of Relationships
Between Team Design Features and Team Performance,”
Journal of Management 32, no. 1 (2006), pp. 29–54; and
A. Joshi and H. Roh, “The Role of Context in Work Team
Diversity Research: A Meta-Analytic Review,” Academy of
Management Journal 52, no. 3 (2009), pp. 599–627.
73. A. C. Homan, J. R. Hollenbeck, S. E. Humphrey, D. Van
Knippenberg, D. R. Ilgen, and G. A. Van Kleef, “Facing
Differences with an Open Mind: Openness to Experience,
Salience of Intragroup Differences, and Performance of
Diverse Work Groups,” Academy of Management Journal 51,
no. 6 (2008), pp. 1204–1222.
74. E. Kearney and D. Gebert, “Managing Diversity and Enhancing
Team Outcomes: The Promise of Transformational
Leadership,” Journal of Applied Psychology 94, no. 1 (2009),
pp. 77–89.
75. C. L. Holladay and M. A. Quiñones, “The Influence of
Training Focus and Trainer Characteristics on Diversity
Training Effectiveness,” Academy of Management Learning and
Education 7, no. 3 (2008), pp. 343–354; and R. Anand and
M. Winters, “A Retrospective View of Corporate Diversity
Training from 1964 to the Present,” Academy of Management
Learning and Education 7, no. 3 (2008), pp. 356–372.
76. Q. M. Roberson and C. K. Stevens, “Making Sense of Diversity
in the Workplace: Organizational Justice and Language
Abstraction in Employees’ Accounts of Diversity-Related
Incidents,” Journal of Applied Psychology 91 (2006), pp. 379–391;
and D. A. Harrison, D. A. Kravitz, D. M. Mayer, L. M. Leslie,
and D. Lev-Arey, “Understanding Attitudes Toward Affirmative
Action Programs in Employment: Summary and Meta-Analysis
of 35 Years of Research,” Journal of Applied Psychology 91 (2006),
pp. 1013–1036.
77. A. Kalev, F. Dobbin, and E. Kelly, “Best Practices or Best
Guesses? Assessing the Efficacy of Corporate Affirmative
Action and Diversity Policies,” American Sociological Review 71,
no. 4 (2006), pp. 589–617.
78. R. J. Crisp and R. N. Turner, “Cognitive Adaptation to the
Experience of Social and Cultural Diversity,” Psychological
Bulletin 137 (2011), pp. 242–266.
79. A. Sippola and A. Smale, “The Global Integration of Diversity
Management: A Longitudinal Case Study,” International
Journal of Human Resource Management 18, no. 11 (2007),
pp. 1895–1916.
80. A. Pomeroy, “Cultivating Female Leaders,” HR Magazine
(February 2007), pp. 44–50.
Ability Validity for Different Occupations in the European
Community,” Journal of Applied Psychology (December 2003),
pp. 1068–1081; and F. L. Schmidt and J. E. Hunter, “Select
on Intelligence,” in E. A. Locke (ed.), Handbook of Principles
of Organizational Behavior (Malden, MA: Blackwell, 2004).
64. Y. Ganzach, “Intelligence and Job Satisfaction,” Academy
of Management Journal 41, no. 5 (1998), pp. 526–539;
and Y. Ganzach, “Intelligence, Education, and Facets of
Job Satisfaction,” Work and Occupations 30, no. 1 (2003),
pp. 97–122.
65. E. A. Fleishman, “Evaluating Physical Abilities Required by
Jobs,” Personnel Administrator (June 1979), pp. 82–92.
66. D. R. Avery, “Reactions to Diversity in Recruitment
Advertising: Are the Differences Black and White?”
Journal of Applied Psychology 88, no. 4 (2003), pp. 672–679;
P. F. McKay and D. R. Avery, “What Has Race Got to Do with
It? Unraveling the Role of Racioethnicity in Job Seekers’
Reactions to Site Visits,” Personnel Psychology 59, no. 2 (2006),
pp. 395–429; and D. R. Avery and P. F. McKay, “Target
Practice: An Organizational Impression Management
Approach to Attracting Minority and Female Job Applicants,”
Personnel Psychology 59, no. 1 (2006), pp. 157–187.
67. M. R. Buckley, K. A. Jackson, M. C. Bolino, J. G. Veres, and
H. S. Field, “The Influence of Relational Demography on
Panel Interview Ratings: A Field Experiment,” Personnel
Psychology 60 (2007), pp. 627–646; J. M. Sacco, C. R. Scheu,
A. M. Ryan, and N. Schmitt, “An Investigation of Race and
Sex Similarity Effects in Interviews: A Multilevel Approach
to Relational Demography,” Journal of Applied Psychology 88
(2003), pp. 852–865; and J. C. Ziegert and P. J. Hanges,
“Employment Discrimination: The Role of Implicit Attitudes,
Motivation, and a Climate for Racial Bias,” Journal of Applied
Psychology 90 (2005), pp. 553–562.
68. J. Schaubroeck and S. S. K. Lam, “How Similarity to Peers
and Supervisor Influences Organizational Advancement
in Different Cultures,” Academy of Management Journal 45
(2002), pp. 1120–1136.
69. P. F. McKay, D. R. Avery, and M. A. Morris, “Mean Racial-
Ethnic Differences in Employee Sales Performance: The
Moderating Role of Diversity Climate,” Personnel Psychology
61, no. 2 (2008), pp. 349–374.
70. A. S. Tsui, T. D. Egan, and C. A. O’Reilly, “Being Different:
Relational Demography and Organizational Attachment,”
Administrative Science Quarterly 37 (1992), pp. 547–579; and
J. M. Sacco and N. Schmitt, “A Dynamic Multilevel Model of
Demographic Diversity and Misfit Effects,” Journal of Applied
Psychology 90 (2005), pp. 203–231.
71. P. F. McKay, D. R. Avery, S. Tonidandel, M. A. Morris,
M. Hernandez, and M. R. Hebl, “Racial Differences in
Employee Retention: Are Diversity Climate Perceptions the
Key?” Personnel Psychology 60, no. 1 (2007), pp. 35–62.

WHAT DOES SAS STAND FOR?
68
M
ost of you probably are not familiar with SAS Institute, Inc. Is it
a think-tank? An educational program to teach children man-
ners? No, SAS (originally Statistical Analysis System) is a Cary,
North Carolina–based software company, and one that happens to be the
best place to work in the United States in 2011 (as it was in 2010), according
to Fortune magazine.
Founded by North Carolina State University graduate student Anthony J.
Barr, SAS quickly established itself as one of the largest developers of statis-
tical software (where its main rival was and continues to be Chicago-based
SPSS, now a division of IBM). Part of the secret of SAS’s growth and success is
that it has branched off into other software markets, such as business plan-
ning and support, quality improvement, data storage, and others. Today, the
firm employs more than 11,000 people.
However, another distinguishing characteristic of SAS is its highly
employee-friendly culture. As a result of being given “the Royal Treatment”
(in the words of 60 Minutes ), SAS employees turn over at a rate under
4 percent, roughly a tenth that of their firm’s competitors.
So what is this royal treatment? SAS provides a host of benefits employ-
ees love, including:
● Free onsite health care.
● Subsidized onsite child care.
● Summer camp for kids.
● “M&M Wednesdays,” when employees are given free candy.
● Soda fountains and snacks in every break room.
● A beauty salon.
● A 66,000-ft 2 recreation and fitness center.
● Car cleaning.
To be sure, these benefits are one reason SAS is a desirable place to
work. However, the firm’s commitment to its employees goes beyond nice
perks. Even in the economic downturn, SAS has refused to lay off employ-
ees and has even expanded its benefits. “In a tough economy, SAS did
not waiver from our commitment to our employees and the innovative
culture that keeps them challenged and provides work–life balance,” said
Jenn Mann, Vice President of Human Resources at SAS. “SAS’s contin-
ued success proves our core belief: Happy, healthy employees are more
productive.”
Says one SAS employee: “People stay at SAS in large part because they
are happy, but to dig a little deeper, I would argue that people don’t leave
LEARNING
OBJECTIVES
After studying this chapter,
you should be able to:
1 Contrast the three
components of an attitude.
2 Summarize the relationship
between attitudes and
behavior.
3 Compare and contrast the
major job attitudes.
4 Define job satisfaction
and show how we can
measure it.
5 Summarize the main causes
of job satisfaction.
6 Identify four employee
responses to dissatisfaction.
MyManagementLab
Access a host of interactive
learning aids to help strengthen
your understanding of the
chapter concepts at
www.mymanagementlab.com

www.mymanagementlab.com

Attitudes and
Job Satisfaction 3
69
Attitude isn’t everything, but it’s close.
— New York Times headline, August 6, 2006
Ph
ot
o:
S
A
S
re
cr
ea
tio
na
l c
en
te
r.
S
ou
rc
e:
C
ha
rly
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ur
z/
la
if/
Re
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Pi
ct
ur
es
69

70 CHAPTER 3 Attitudes and Job Satisfac tion
S A L
SELF-ASSESSMENT LIBRARY
SAS because they feel regarded—seen, attended to and cared for. I have stayed
for that reason, and love what I do for that reason.”
Sources: “100 Best Companies to Work For 2011,” Fortune (January 7, 2011), http://money
.cnn.com/ ; D. Bracken, “SAS Again Tops Fortune List of Best Places to Work,” Charlotte Observer
(January 20, 2011), www.charlotteobserver.com/ ; and S. Rezvani, “What Makes a ‘Best
Workplace?’ ” Washington Post (January 21, 2011), http://views.washingtonpost.com/ .
T hough most will not go as far as SAS to promote employee satisfaction, many organizations are very concerned with the attitudes of their employ-ees. In this chapter, we look at attitudes, their link to behavior, and how
employees’ satisfaction or dissatisfaction with their jobs affects the workplace.
What are your attitudes toward your job? Use the following Self-Assessment
Library to determine your level of satisfaction with your current or past jobs.
How Satisfied Am I with My Job?
In the Self-Assessment Library (available on CD or online), take assessment I.B.3
(How Satisfied Am I with My Job?) and then answer the following questions. If
you currently do not have a job, answer the questions for your most recent job.
1. How does your job satisfaction compare to that of others in your class who
have taken the assessment?
2. Why do you think your satisfaction is higher or lower than average?
Attitudes are evaluative statements—either favorable or unfavorable—about
objects, people, or events. They reflect how we feel about something. When I
say “I like my job,” I am expressing my attitude about work.
Attitudes are complex. If you ask people about their attitude toward religion,
Lady Gaga, or the organization they work for, you may get a simple response, but
the reasons underlying it are probably complicated. In order to fully understand
attitudes, we must consider their fundamental properties or components.
What Are the Main Components of Attitudes?
Typically, researchers have assumed that attitudes have three components: cog-
nition, affect, and behavior. 1 Let’s look at each.
The statement “My pay is low” is the cognitive component of an attitude—
a description of or belief in the way things are. It sets the stage for the more
critical part of an attitude—its affective component . Affect is the emotional or
feeling segment of an attitude and is reflected in the statement “I am angry over
how little I’m paid.” Finally, affect can lead to behavioral outcomes. The behav-
ioral component of an attitude describes an intention to behave in a certain way
toward someone or something—to continue the example, “I’m going to look
for another job that pays better.”
Viewing attitudes as having three components—cognition, affect, and
behavior—is helpful in understanding their complexity and the potential
1 Contrast the three
components of an attitude.
Attitudes

www.charlotteobserver.com/

http://money.cnn.com/

http://views.washingtonpost.com/

Attitudes 71
relationship between attitudes and behavior. Keep in mind that these compo-
nents are closely related, and cognition and affect in particular are inseparable
in many ways. For example, imagine you realized that someone has just treated
you unfairly. Aren’t you likely to have feelings about that, occurring virtually in-
stantaneously with the realization? Thus, cognition and affect are intertwined.
Exhibit 3-1 illustrates how the three components of an attitude are related.
In this example, an employee didn’t get a promotion he thought he deserved;
a co-worker got it instead. The employee’s attitude toward his supervisor is illus-
trated as follows: the employee thought he deserved the promotion (cognition),
he strongly dislikes his supervisor (affect), and he is looking for another job
(behavior). As we’ve noted, although we often think cognition causes affect, which
then causes behavior, in reality these components are often difficult to separate.
In organizations, attitudes are important for their behavioral component. If
workers believe, for example, that supervisors, auditors, bosses, and time-and-
motion engineers are all in conspiracy to make employees work harder for the
same or less money, it makes sense to try to understand how these attitudes
formed, how they relate to actual job behavior, and how they might be changed.
Does Behavior Always Follow from Attitudes?
Early research on attitudes assumed they were causally related to behavior—
that is, the attitudes people hold determine what they do. Common sense, too,
suggests a relationship. Isn’t it logical that people watch television programs
they like, or that employees try to avoid assignments they find distasteful?
Negative
attitude
toward
supervisor
Cognitive = evaluation
My supervisor gave a promotion
to a coworker who deserved it
less than me. My supervisor is unfair.
Affective = feeling
I dislike my supervisor!
C
o
g
n
it
io
n
,
a
ff
e
ct
,
a
n
d
b
e
h
a
v
io
r
a
re
c
lo
se
ly
r
e
la
te
d
.
Behavioral = action
I’m looking for other work; I’ve
complained about my supervisor
to anyone who would listen.
The Components of an Attitude Exhibit 3-1
attitudes Evaluative statements or
judgments concerning objects, people,
or events. affective component The emotional or
feeling segment of an attitude.
behavioral component An intention
to behave in a certain way toward
someone or something.
cognitive component The opinion or
belief segment of an attitude.
2 Summarize the relationship
between attitudes and
behavior.

72 CHAPTER 3 Attitudes and Job Satisfac tion
However, in the late 1960s, a review of the research challenged this assumed
effect of attitudes on behavior. 2 One researcher—Leon Festinger—argued
that attitudes follow behavior. Did you ever notice how people change what
they say so it doesn’t contradict what they do? Perhaps a friend of yours has
consistently argued that the quality of U.S. cars isn’t up to that of imports and
that he’d never own anything but a Japanese or German car. But his dad gives
him a late-model Ford Mustang, and suddenly he says U.S. cars aren’t so bad.
Festinger proposed that cases of attitude following behavior illustrate the ef-
fects of cognitive dissonance , 3 any incompatibility an individual might perceive
between two or more attitudes or between behavior and attitudes. Festinger
argued that any form of inconsistency is uncomfortable and that individuals
will therefore attempt to reduce it. They will seek a stable state, which is a mini-
mum of dissonance.
Research has generally concluded that people do seek consistency among
their attitudes and between their attitudes and their behavior. 4 They either
alter the attitudes or the behavior, or they develop a rationalization for the
discrepancy. Tobacco executives provide an example. 5 How, you might won-
der, do these people cope with the continuing revelations about the health
dangers of smoking? They can deny any clear causation between smoking and
cancer. They can brainwash themselves by continually articulating the benefits
of tobacco. They can acknowledge the negative consequences of smoking but
rationalize that people are going to smoke and that tobacco companies merely
promote freedom of choice. They can accept the evidence and make cigarettes
less dangerous or reduce their availability to more vulnerable groups, such as
teenagers. Or they can quit their job because the dissonance is too great.
No individual, of course, can completely avoid dissonance. You know cheat-
ing on your income tax is wrong, but you fudge the numbers a bit every year
and hope you’re not audited. Or you tell your children to floss their teeth, but
you don’t do it yourself. Festinger proposed that the desire to reduce disso-
nance depends on moderating factors, including the importance of the elements
creating it and the degree of influence we believe we have over them. Individuals
Marriott International strives for
consistency between employee
attitudes and behavior through its
motto “Spirit to Serve.” CEO and
chairman J. W. Marriott, Jr., models
the behavior of service by visiting
hotel employees throughout the
year. “I want our associates to know
that there really is a guy named
Marriott who cares about them,” he
says. The company honors employ-
ees with job excellence awards
for behavior that exemplifies an
attitude of service to customers
and co-workers.
So
u
rc
e
:
B
il
l
G
re
e
n
b
la
t/
U
P
I/
N
e
w
sc
o
m

Attitudes 73
will be more motivated to reduce dissonance when the attitudes or behavior are
important or when they believe the dissonance is due to something they can
control. A third factor is the rewards of dissonance; high rewards accompanying
high dissonance tend to reduce the tension inherent in the dissonance.
While Festinger argued that attitudes follow behavior, other researchers
asked whether there was any relationship at all. More recent research shows that
attitudes predict future behavior and confirmed Festinger’s idea that “moderat-
ing variables” can strengthen the link. 6
Moderating Variables The most powerful moderators of the attitudes rela-
tionship are the importance of the attitude, its correspondence to behavior, its acces-
sibility, the presence of social pressures, and whether a person has direct experience
with the attitude. 7
Important attitudes reflect our fundamental values, self-interest, or iden-
tification with individuals or groups we value. These attitudes tend to show a
strong relationship to our behavior.
Specific attitudes tend to predict specific behaviors, whereas general at-
titudes tend to best predict general behaviors. For instance, asking someone
about her intention to stay with an organization for the next 6 months is likely
to better predict turnover for that person than asking her how satisfied she is
with her job overall. On the other hand, overall job satisfaction would better
predict a general behavior, such as whether the individual was engaged in her
work or motivated to contribute to her organization. 8
Attitudes that our memories can easily access are more likely to predict our
behavior. Interestingly, you’re more likely to remember attitudes you frequently
express. So the more you talk about your attitude on a subject, the more likely
you are to remember it, and the more likely it is to shape your behavior.
Discrepancies between attitudes and behavior tend to occur when social
pressures to behave in certain ways hold exceptional power, as in most orga-
nizations. This may explain why an employee who holds strong anti-union at-
titudes attends pro-union organizing meetings, or why tobacco executives, who
are not smokers themselves and who tend to believe the research linking smok-
ing and cancer, don’t actively discourage others from smoking.
Finally, the attitude–behavior relationship is likely to be much stronger if
an attitude refers to something with which we have direct personal experience.
Asking college students with no significant work experience how they would
respond to working for an authoritarian supervisor is far less likely to predict
actual behavior than asking that same question of employees who have actually
worked for such an individual.
What Are the Major Job Attitudes?
We each have thousands of attitudes, but OB focuses our attention on a very
limited number of work-related attitudes. These tap positive or negative evalu-
ations that employees hold about aspects of their work environment. Most of
the research in OB has looked at three attitudes: job satisfaction, job involve-
ment, and organizational commitment. 9 A few other important attitudes are
perceived organizational support and employee engagement; we’ll also briefly
discuss these.
cognitive dissonance Any
incompatibility between two or more
attitudes or between behavior and
attitudes.
3 Compare and contrast the
major job attitudes.

74 CHAPTER 3 Attitudes and Job Satisfac tion
Job Satisfaction When people speak of employee attitudes, they usually mean
job satisfaction , which describes a positive feeling about a job, resulting from
an evaluation of its characteristics. A person with a high level of job satisfaction
holds positive feelings about his or her job, while a person with a low level holds
negative feelings. Because OB researchers give job satisfaction high importance,
we’ll review this attitude in detail later in the chapter.
Job Involvement Related to job satisfaction is job involvement , 10 which mea-
sures the degree to which people identify psychologically with their job and con-
sider their perceived performance level important to self-worth. 11 Employees with
a high level of job involvement strongly identify with and really care about the kind
of work they do. Another closely related concept is psychological empowerment ,
employees’ beliefs in the degree to which they influence their work environment,
their competence, the meaningfulness of their job, and their perceived auton-
omy. 12 One study of nursing managers in Singapore found that good leaders
empower their employees by involving them in decisions, making them feel their
work is important, and giving them discretion to “do their own thing.” 13
High levels of both job involvement and psychological empowerment are
positively related to organizational citizenship and job performance. 14 High job
involvement is also related to reduced absences and lower resignation rates. 15
Organizational Commitment In organizational commitment , an employee
identifies with a particular organization and its goals and wishes to remain a
R
esearch by the Conference Board
suggests that job satisfaction for
U.S. employees is at a 23-year
low. This appears to be occurring in the
midst of a dramatic growth in informa-
tion technology that was supposed to
make work easier for employees. What
is going on here? Are employers failing
to consider an ethical responsibility to
employees by providing a satisfying,
fulfilling experience at work?
When Professor James Heskett
of Harvard posted information about
these low job satisfaction rates on
his blog, respondents provided a vari-
ety of different explanations for why
U.S. workers are less satisfied than
they were in the past. They included
economic pressures, instability in
the business environment, and in-
creased competition to get the best
jobs. Others believe businesses have
become so focused on stock prices
and profitability that the personal re-
lationship that used to exist between
employers and employees has been
lost. Still others proposed that in a
poor economic environment, employ-
ees who wanted to switch to a new
job aren’t always able to find alterna-
tives, leaving them “hostages” to a
dissatisfying work situation.
Whatever the explanation, there
is cause for concern. Survey data
from Towers Watson’s global work-
force study of 20,000 employees in
22 markets around the world found
that employees are especially con-
cerned about job security and feel
they are entirely responsible for ensur-
ing their long-term career prospects
work out. In the current economic
environment, it seems that in employ-
ers’ minds, employee well-being and
security have taken a back seat to cop-
ing with workplace realities.
What can managers do to ensure
they are making ethical decisions
about protecting the quality of the
workplace in their organizations? As
we have shown, managers can enact
a variety of concrete steps—including
improving working conditions and pro-
viding a positive social environment—
that will make work more enjoyable for
employees. Employers may also want
to think about whether their efforts to
achieve efficiency and productivity are
creating a work environment that is
not very satisfying for employees.
Sources: Based on J. Heskett, “Why Are
Fewer and Fewer U.S. Employees Satisfied
with Their Jobs?” Harvard Business School
Working Knowledge (April 2, 2010), hbswk
.hbs.edu; and Towers Watson, 2010 Global
Workforce Study (New York: Author, 2010).
An Ethical Choice
Do Employers Owe Workers More Satisfying Jobs?

Attitudes 75
member. Most research has focused on emotional attachment to an organiza-
tion and belief in its values as the “gold standard” for employee commitment. 16
A positive relationship appears to exist between organizational commit-
ment and job productivity, but it is a modest one. 17 A review of 27 studies sug-
gested the relationship between commitment and performance is strongest for
new employees and considerably weaker for more experienced employees. 18
Interestingly, research indicates that employees who feel their employers fail
to keep promises to them feel less committed, and these reductions in commit-
ment, in turn, lead to lower levels of creative performance. 19 And, as with job in-
volvement, the research evidence demonstrates negative relationships between
organizational commitment and both absenteeism and turnover. 20
Theoretical models propose that employees who are committed will be less
likely to engage in work withdrawal even if they are dissatisfied, because they
have a sense of organizational loyalty. On the other hand, employees who are
not committed, who feel less loyal to the organization, will tend to show lower
levels of attendance at work across the board. Research confirms this theoreti-
cal proposition. 21 It does appear that even if employees are not currently happy
with their work, they are willing to make sacrifices for the organization if they
are committed enough.
At Veterinary Cancer Group in
Tustin, California, employees
are committed to their company
because they identify with their
organization and its goals and
want to remain part of the small
business. The client care special-
ists shown in this photo and their
co-workers share the cancer clinic’s
goal of improving the quality of
life for patients and giving sup-
port to the families of patients.
Veterinarian Mona Rosenberg, who
founded the practice, has created
a positive work environment at the
clinic by hiring kind and compas-
sionate people and by valuing the
work of each employee, resulting in
the favorable employee attitude of
organizational commitment.
job involvement The degree to which
a person identifies with a job, actively
participates in it, and considers
performance important to self-worth.
psychological empowerment
Employees’ belief in the degree
to which they affect their work
environment, their competence, the
meaningfulness of their job, and their
perceived autonomy in their work.
organizational commitment The
degree to which an employee
identifies with a particular organization
and its goals and wishes to maintain
membership in the organization.
job satisfaction A positive feeling
about one’s job resulting from an
evaluation of its characteristics.
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76 CHAPTER 3 Attitudes and Job Satisfac tion
Perceived Organizational Support Perceived organizational support (POS) is
the degree to which employees believe the organization values their contribution
and cares about their well-being (for example, an employee believes his organiza-
tion would accommodate him if he had a child care problem or would forgive an
honest mistake on his part). Research shows that people perceive their organiza-
tion as supportive when rewards are deemed fair, when employees have a voice
in decisions, and when they see their supervisors as supportive. 22 Employees with
strong POS perceptions have been found more likely to have higher levels of or-
ganizational citizenship behaviors, lower levels of tardiness, and better customer
T
he increased time pressures
of the always-connected work-
place are eroding the boundary
between work life and personal life,
and many individuals in postindustrial
economies struggle to balance the
two. Is this striving for work–life bal-
ance unique to the North American
and European context, or is it a global
phenomenon?
One possible reason for variations
in work–life balance across countries is
differences in the structure and func-
tioning of the family. Some research
suggests that countries with stronger
differences in expectations for men
and women have different levels and
types of work–life conflict. Other re-
search suggests that work–life balance
will be different in an individualistic
country like the United States than in
a country that is more collectivist in its
orientation. In individualist countries,
employers might expect more sacri-
fice from their employees in terms of
their family lives, whereas collectiv-
ist nations where family has a higher
priority will have fewer work–life bal-
ance issues. Conversely, collectivists’
higher value on family may mean they
feel more conflicted if there are com-
peting demands from the workplace
and home.
There are other reasons to suspect
that research based on the U.S. con-
text will not generalize to other coun-
tries. Data from a study by Harvard and
McGill University researchers found
that work–life balance policies like paid
maternity leave, paternity leave, and
paid time off in the United States are
far less generous than in other wealthy
nations. The study’s lead author, Jody
Heymann, notes, “More countries are
providing the workplace protections
that millions of Americans can only
dream of.” The research interest in
work–life balance may at least partially
be a reflection of an unusually strong
conflict between work and family life
in the United States.
At the same time, many of the
same issues that contribute to work–
life imbalance are present in other
countries. Globally, the rise of the
dual-earner couple has meant that
both partners now have family respon-
sibilities that must be met. Always-
connected technology that blurs the
line between personal and work time
have become standard for managers in
every part of the world. The institution
of “siesta,” or a midday break, used
to be much more common in Hispanic
cultures than it is today as the global-
ized workplace puts greater demands
on workers. Concerns about overwork
have also become very prevalent in
the rapidly growing economic sphere
of East Asia. The Japanese even have
a term, karoshi, referring to death from
overwork.
Research to date does suggest
that work–life concerns are present
in other cultures. For example, most
studies find that feelings of conflict
between work and personal life are re-
lated to lower levels of satisfaction and
higher levels of psychological strain.
The magnitude of these relationships
varies across countries, but it appears
that concerns about work interfering
with family are present around the
world. There is also evidence that
translated U.S. surveys about work–
life conflicts are equally good mea-
sures of work–life conflicts in Europe
and East Asia.
Even with the growth of interna-
tional research, most studies to date
have been designed and conducted
entirely within the United States, and
many others have been conducted in
cultures with marked similarities to the
United States, like Canada and Great
Britain. As the number of international
studies continues to increase, we will
develop a better understanding of how
different cultures relate to work–life
challenges.
Sources: Based on G. N. Powell, A. M.
Francesco, and Y. Ling, “Toward Culture-
Sensitive Theories of the Work–Family
Interface,” Journal of Organizational
Behavior 30 (2009), pp. 597–616; “Survey:
U.S. Workplace Not Family-Oriented.”
MSNBC.com , (May 22, 2007), www
.msnbc.msn.com/id/16907584/ ; and J. Lu,
O. Siu, P. E. Spector, and K. Shi, “Antecedents
and Outcomes of a Fourfold Taxonomy of
Work-Family Balance in Chinese Employed
Parents,” Journal of Occupational Health
Psychology 14 (2009), pp. 182–192.
glOBalization!
Culture and Work–Life Balance

www.msnbc.msn.com/id/16907584/

Attitudes 77
service. 23 Though little cross-cultural research has been done, one study found
POS predicted only the job performance and citizenship behaviors of untradi-
tional or low power-distance Chinese employees—in short, those more likely to
think of work as an exchange rather than a moral obligation. 24
Employee Engagement A new concept is employee engagement , an individual’s
involvement with, satisfaction with, and enthusiasm for, the work she does. We
might ask employees whether they have access to resources and the opportunities
to learn new skills, whether they feel their work is important and meaningful, and
whether their interactions with co-workers and supervisors are rewarding. 25 Highly
engaged employees have a passion for their work and feel a deep connection
to their company; disengaged employees have essentially checked out—putting
time but not energy or attention into their work. A study of nearly 8,000 business
units in 36 companies found that those whose employees had high-average levels
of engagement had higher levels of customer satisfaction, were more produc-
tive, brought in higher profits, and had lower levels of turnover and accidents
than at other companies. 26 Molson Coors found engaged employees were five
times less likely to have safety incidents, and when one did occur it was much
less serious and less costly for the engaged employee than for a disengaged one
($63 per incident versus $392). Engagement becomes a real concern for most
organizations because surveys indicate that few employees— between 17 percent
and 29 percent—are highly engaged by their work. Caterpillar set out to increase
employee engagement and recorded a resulting 80 percent drop in grievances
and a 34 percent increase in highly satisfied customers. 27
Employee engagement is high at
Genentech, a biotechnology firm
where employees share a serious
commitment to science and patients
and are passionate about the work
they do. Genentech employees
discover, develop, manufacture,
and commercialize medicines that
treat patients with serious or life-
threatening medical conditions.
Feeling that their contributions are
important and meaningful, employ-
ees cite the chance to make a dif-
ference in the lives of patients as
the number one reason they enjoy
working at Genentech.
employee engagement An individual’s
involvement with, satisfaction with,
and enthusiasm for the work he or
she does.
perceived organizational support
(POS) The degree to which
employees believe an organization
values their contribution and cares
about their well-being.
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78 CHAPTER 3 Attitudes and Job Satisfac tion
S A L
SELF-ASSESSMENT LIBRARY
Such promising findings have earned employee engagement a following in
many business organizations and management consulting firms. However, the
concept is relatively new and still generates active debate about its usefulness.
One review of the literature concluded, “The meaning of employee engage-
ment is ambiguous among both academic researchers and among practitioners
who use it in conversations with clients.” Another reviewer called engagement
“an umbrella term for whatever one wants it to be.” 28 More recent research has
set out to clarify the dimensions of employee engagement. This work has dem-
onstrated that engagement is distinct from job satisfaction and job involvement
and incrementally predicts job behaviors after we take these traditional job at-
titudes into account.
Am I Engaged?
In the Self-Assessment Library (available on CD or online), take assessment
IV.B.1 (Am I Engaged?). (Note: If you do not currently have a job, answer the
questions for your most recent job.)
Are These Job Attitudes Really All That Distinct? You might wonder whether
these job attitudes are really distinct. If people feel deeply engaged by their
job (high job involvement), isn’t it probable they like it too (high job sat-
isfaction)? Won’t people who think their organization is supportive (high
perceived organizational support) also feel committed to it (strong organiza-
tional commitment)?
Evidence suggests these attitudes are highly related, perhaps to a troubling
degree. For example, the correlation between perceived organizational sup-
port and affective commitment is very strong. 29 That means the variables may be
redundant—if you know someone’s affective commitment, you know her perceived
organizational support. Why is redundancy troubling? Because it is inefficient and
confusing. Why have two steering wheels on a car when you need only one? Why
have two concepts—going by different labels—when you need only one?
Although we OB researchers like proposing new attitudes, often we haven’t
been good at showing how they compare and contrast with each other. There is
some distinctiveness among them, but they overlap greatly, for various reasons in-
cluding the employee’s personality. Some people are predisposed to be positive or
negative about almost everything. If someone tells you she loves her company, it
may not mean a lot if she is positive about everything else in her life. Or the overlap
may mean some organizations are just all-around better places to work than others.
Then if you as a manager know someone’s level of job satisfaction, you know most
of what you need to know about how that person sees the organization.
We have already discussed job satisfaction briefly. Now let’s dissect the concept
more carefully. How do we measure job satisfaction? What causes an employee
to have a high level of job satisfaction? How do dissatisfied and satisfied employ-
ees affect an organization?
4 Define job satisfaction and
show how we can measure it.
Job Satisfaction

Job Satisfaction 79
Measuring Job Satisfaction
Our definition of job satisfaction—a positive feeling about a job resulting
from an evaluation of its characteristics—is clearly broad. 30 Yet that breadth
is appropriate. A job is more than just shuffling papers, writing program-
ming code, waiting on customers, or driving a truck. Jobs require interact-
ing with co-workers and bosses, following organizational rules and policies,
meeting performance standards, living with less than ideal working condi-
tions, and the like. 31 An employee’s assessment of his satisfaction with the
job is thus a complex summation of many discrete elements. How, then, do
we measure it?
Two approaches are popular. The single global rating is a response to
one question, such as “All things considered, how satisfied are you with
your job?” Respondents circle a number between 1 and 5 on a scale from
“highly satisfied” to “highly dissatisfied.” The second method, the summa-
tion of job facets, is more sophisticated. It identifies key elements in a job
such as the nature of the work, supervision, present pay, promotion oppor-
tunities, and relationships with co-workers. 32 Respondents rate these on a
standardized scale, and researchers add the ratings to create an overall job
satisfaction score.
Is one of these approaches superior? Intuitively, summing up responses to
a number of job factors seems likely to achieve a more accurate evaluation of
job satisfaction. Research, however, doesn’t support the intuition. 33 This is one
of those rare instances in which simplicity seems to work as well as complex-
ity, making one method essentially as valid as the other. The best explanation
is that the concept of job satisfaction is so broad a single question captures
its essence. The summation of job facets may also leave out some important
data. Both methods are helpful. The single global rating method isn’t very
time consuming, thus freeing time for other tasks, and the summation of job
facets helps managers zero in on problems and deal with them faster and more
accurately.
What Are the Main Causes of Job Dissatisfaction?OB Poll
0 20 4010 30 50453525155
On-the-job stress
Pay
Promotion
Work
Security
Supervisor
Coworkers
32%
% Dissatisfied with Aspect of Job
26%
21%
15%
14%
9%
3%
Source: L. Saad, “On-the-Job Stress Is U.S. Workers’ Biggest Complaint,” Gallup Poll (August 30, 2010), www.gallup.com/ .

www.gallup.com/

80 CHAPTER 3 Attitudes and Job Satisfac tion
0
20
10
40
30
60
50
80
70
100
90
Work Itself Pay
P
e
rc
e
n
ta
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e
Promotion Supervision Coworkers Overall
Average Job Satisfaction Levels by Facet Exhibit 3-2
How Satisfied Are People in Their Jobs?
Are most people satisfied with their jobs? The answer seems to be a qualified
“yes” in the United States and most other developed countries. Independent
studies conducted among U.S. workers over the past 30 years generally indicate
more workers are satisfied with their jobs than not. But a caution is in order.
Recent data show a dramatic drop-off in average job satisfaction levels during
the economic contraction that started in late 2007, so much so that only about
half of workers report being satisfied with their jobs now. 34
Research also shows satisfaction levels vary a lot, depending on which
facet of job satisfaction you’re talking about. As shown in Exhibit 3-2 , peo-
ple have typically been more satisfied with their jobs overall, with the work
itself, and with their supervisors and co-workers than they have been with
their pay and with promotion opportunities. It’s not really clear why peo-
ple dislike their pay and promotion possibilities more than other aspects of
their jobs. 35
Although job satisfaction appears relevant across cultures, that doesn’t
mean there are no cultural differences in job satisfaction. Evidence suggests
employees in Western cultures have higher levels of job satisfaction than those
in Eastern cultures. 36 Exhibit 3-3 provides the results of a global study of job
satisfaction levels of workers in 15 countries. (This study included 23 countries,
but for presentation purposes we report the results for only the largest.) As
the exhibit shows, the highest levels appear in the United States and western
Europe. Do employees in Western cultures have better jobs? Or are they sim-
ply more positive (and less self critical)? Although both factors are probably
at play, evidence suggests that individuals in Eastern cultures find negative
emotions less aversive more than do individuals in Western cultures, who tend
to emphasize positive emotions and individual happiness. 37 That may be why
employees in Western cultures such as the United States and Scandinavia are
more likely to have higher levels of satisfaction.

Job Satisfaction 81
De
nm
ar
k
De
nm
ar
k
Sw
itz
er
lan
d
Sw
itz
er
lan
d
US
A
US
A
N
or
wa
y
N
or
wa
y
Sw
ed
en
Sw
ed
en
Ge
rm
an
y
Ge
rm
an
y
Po
lan
d
Po
lan
d UKUK
Ca
na
da
Ca
na
da Ita
ly
Ita
ly
Fra
nc
e
Fra
nc
e
Cz
ec
h
Re
p
Cz
ec
h
Re
p
Ru
ssi
a
Ru
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a
Hu
ng
ar
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Hu
ng
ar
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Ja
pa
n
Ja
pa
nkk dd AA yy nn yy dd KK aa lyly ee pp aa yy nn
4.20
4.40
4.60
4.80
5.00
5.20
5.40
5.60
5.80
5.68
5.43
5.32
5.20 5.20
5.12 5.08 5.08 5.06 5.06 5.06 5.06
4.84 4.77 4.74
Average Levels of Job Satisfaction by Country
Note: Scores represent average job-satisfaction levels in each country as rated on a 1 � very dissatisfied to 10 � very satisfied scale.
Source: M. Benz and B. S. Frey, “The Value of Autonomy: Evidence from the Self-Employed in 23 Countries,” working paper 173,
Institute for Empirical Research in Economics, University of Zurich, November 2003 ( ssrn.com/abstract�475140 ).
Exhibit 3-3
5 Summarize the main causes
of job satisfaction.
What Causes Job Satisfaction?
Think about the best job you’ve ever had. What made it so? Chances are you liked
the work you did and the people with whom you worked. Interesting jobs that
provide training, variety, independence, and control satisfy most employees. 38
There is also a strong correspondence between how well people enjoy the social
context of their workplace and how satisfied they are overall. Interdependence,
feedback, social support, and interaction with co-workers outside the workplace
are strongly related to job satisfaction even after accounting for characteristics
of the work itself. 39
You’ve probably noticed that pay comes up often when people discuss job
satisfaction. For people who are poor or who live in poor countries, pay does
correlate with job satisfaction and overall happiness. But once an individual
reaches a level of comfortable living (in the United States, that occurs at
about $40,000 a year, depending on the region and family size), the relation-
ship between pay and job satisfaction virtually disappears. People who earn
$80,000 are, on average, no happier with their jobs than those who earn closer
to $40,000. Take a look at Exhibit 3-4 . It shows the relationship between the
average pay for a job and the average level of job satisfaction. As you can see,
there isn’t much of a relationship there. Handsomely compensated jobs have
average satisfaction levels no higher than those that pay much less. One re-
searcher even found no significant difference when he compared the overall
well-being of the richest people on the Forbes 400 list with that of Maasai herd-
ers in East Africa. 40
Money does motivate people, as we will discover in Chapter 6 . But what mo-
tivates us is not necessarily the same as what makes us happy. A recent poll by
UCLA and the American Council on Education found that entering college
freshmen rated becoming “very well off financially” first on a list of 19 goals,
ahead of choices such as helping others, raising a family, or becoming proficient
in an academic pursuit. Maybe your goal isn’t to be happy. But if it is, money’s
probably not going to do much to get you there. 41

82 CHAPTER 3 Attitudes and Job Satisfac tion
Job satisfaction is not just about job conditions. Personality also plays a role.
Research has shown that people who have positive core self-evaluations —who
believe in their inner worth and basic competence—are more satisfied with their
jobs than those with negative core self-evaluations. Not only do they see their
work as more fulfilling and challenging, they are more likely to gravitate toward
challenging jobs in the first place. Those with negative core self- evaluations set
less ambitious goals and are more likely to give up when confronting difficulties.
Thus, they’re more likely to be stuck in boring, repetitive jobs than those with
positive core self-evaluations. 42
The Impact of Satisfied and Dissatisfied
Employees on the Workplace
What happens when employees like their jobs, and when they dislike their jobs?
One theoretical model—the exit–voice–loyalty–neglect framework—is helpful
in understanding the consequences of dissatisfaction. Exhibit 3-5 illustrates the
framework’s four responses, which differ along two dimensions: constructive/
destructive and active/passive. The responses are as follows: 43
● Exit. The exit response directs behavior toward leaving the organiza-
tion, including looking for a new position as well as resigning.
● Voice. The voice response includes actively and constructively attempt-
ing to improve conditions, including suggesting improvements, discussing
problems with superiors, and undertaking some forms of union activity.
● Loyalty. The loyalty response means passively but optimistically waiting
for conditions to improve, including speaking up for the organization in
the face of external criticism and trusting the organization and its man-
agement to “do the right thing.”
● Neglect. The neglect response passively allows conditions to worsen and
includes chronic absenteeism or lateness, reduced effort, and increased
error rate.
40%
50%
60%
70%
80%
90%
$15,000 $30,000 $45,000 $60,000 $75,000 $90,000
P
e
rc
e
n
ta
g
e
o
f
P
a
y
S
a
ti
sf
a
ct
io
n
Pay in US$—2002
Relationship Between Average Pay in Job
and Job Satisfaction of Employees in That Job
Source: T. A. Judge, R. F. Piccolo, N. P. Podsakoff, J. C. Shaw, and B. L. Rich, “Can Happiness Be ‘Earned’? The Relationship
Between Pay and Job Satisfaction,” working paper, University of Florida, 2005.
Exhibit 3-4
6 Identify four employee
responses to dissatisfaction.

Job Satisfaction 83
Active
Constructive Destructive
Passive
VOICE EXIT
LOYALTY NEGLECT
Responses to Dissatisfaction Exhibit 3-5
T
his statement appears to be true.
A recent study of 2,178 busi-
ness units suggested that job
attitudes measured at one point in
time predicted organizational financial
performance roughly six months later.
In the study, job attitudes were mea-
sured through employees’ responses
to 12 questions (such as, “At work, my
opinions seem to count”) and financial
performance was measured in terms
of revenue and profit margin.
Why does employee job satisfac-
tion appear to pay off? The authors of
this study uncovered two explanations:
satisfied employees are less likely to
quit, and they engender stronger cus-
tomer loyalty. Low turnover and high
customer loyalty both helped make
organizations more profitable.
This study also found some evidence
for what might be called a virtuous
cycle: having satisfied employees tends
to improve subsequent financial perfor-
mance, which tends to improve later
employee satisfaction even further.
No organization can be all things
to all employees, but this study does
suggest that attention to improving
employee attitudes is well rewarded.
The authors of this study conclude,
“Improving employee work perceptions
can improve business competitiveness
while positively impacting the well-
being of employees.”
Sources: Based on Anonymous, “Happy
Employees May Be the Key to Success for
Organizations,” Science Daily (August 4,
2010), www.sciencedaily.com ; J. K. Harter
and F. L. Schmidt, “What Really Drives
Financial Success?” Gallup Management
Journal (September 2, 2010), http://gmj
.gallup.com/content/142733/really-drives-
financial-success.aspx .
Myth or Science?
“Favorable Job Attitudes Make Organizations
More Profitable”
exit Dissatisfaction expressed
through behavior directed toward
leaving the organization.
loyalty Dissatisfaction expressed by
passively waiting for conditions to
improve.
neglect Dissatisfaction expressed
through allowing conditions to worsen.
voice Dissatisfaction expressed
through active and constructive
attempts to improve conditions.
core self-evaluations Bottom-line
conclusions individuals have about
their capabilities, competence, and
worth as a person.

www.sciencedaily.com

http://gmj.gallup.com/content/142733/really-drivesfinancial-success.aspx

84 CHAPTER 3 Attitudes and Job Satisfac tion
Exit and neglect behaviors encompass our performance variables—
productivity, absenteeism, and turnover. But this model expands employee
response to include voice and loyalty—constructive behaviors that allow individ-
uals to tolerate unpleasant situations or revive satisfactory working conditions.
It helps us understand situations, such as we sometimes find among unionized
workers, for whom low job satisfaction is coupled with low turnover. 44 Union
members often express dissatisfaction through the grievance procedure or for-
mal contract negotiations. These voice mechanisms allow them to continue in
their jobs while convincing themselves they are acting to improve the situation.
As helpful as this framework is, it’s quite general. We now discuss more spe-
cific outcomes of job satisfaction and dissatisfaction in the workplace.
Job Satisfaction and Job Performance As several studies have concluded, happy
workers are more likely to be productive workers. Some researchers used to be-
lieve the relationship between job satisfaction and job performance was a myth.
But a review of 300 studies suggested the correlation is pretty strong. 45 As we
move from the individual to the organizational level, we also find support for the
satisfaction–performance relationship. 46 When we gather satisfaction and pro-
ductivity data for the organization as a whole, we find organizations with more
satisfied employees tend to be more effective than organizations with fewer.
Job Satisfaction and OCB It seems logical to assume job satisfaction should
be a major determinant of an employee’s organizational citizenship behavior
(OCB). 47 Satisfied employees would seem more likely to talk positively about the
organization, help others, and go beyond the normal expectations in their job,
perhaps because they want to reciprocate their positive experiences. Consistent
with this thinking, evidence suggests job satisfaction is moderately correlated
with OCBs; people who are more satisfied with their jobs are more likely to
engage in OCBs. 48 Why? Fairness perceptions help explain the relationship. 49
Those who feel their co-workers support them are more likely to engage in
helpful behaviors, whereas those who have antagonistic relationships with co-
workers are less likely to do so. 50 Individuals with certain personality traits are
Customers of CSN Stores appreci-
ate the excellent service provided
by the online retailer’s customer
representatives shown here at
the company’s offices in Boston.
Service firms like CSN understand
that satisfied employees increase
customer satisfaction and loyalty.
CSN believes that customers deserve
exceptional service and is dedicated
to hiring people who are friendly
and willing to help others. The
company helps shape a positive on-
the-job attitude by giving employ-
ees product knowledge training
and teaching them how to assess
customer needs and how to guide
buyers in making well-informed
decisions.
So
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rc
e
:
M
e
la
n
ie
S
te
ts
o
n
F
re
e
m
a
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/C
SM
/N
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w
sc
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Job Satisfaction 85
also more satisfied with their work, which in turn leads them to engage in more
OCBs. 51 Finally, research shows that when people are in a good mood, they are
more likely to engage in OCBs. 52
Job Satisfaction and Customer Satisfaction As we noted in Chapter 1 , employ-
ees in service jobs often interact with customers. Because service organization
managers should be concerned with pleasing those customers, it is reasonable
to ask, Is employee satisfaction related to positive customer outcomes? For front-
line employees who have regular customer contact, the answer is “yes.” Satisfied
employees increase customer satisfaction and loyalty. 53
A number of companies are acting on this evidence. The first core value
of online retailer Zappos, “Deliver WOW through service,” seems fairly obvi-
ous, but the way in which Zappos does it is not. Employees are encouraged to
“create fun and a little weirdness” and are given unusual discretion in mak-
ing customers satisfied; they are encouraged to use their imaginations, includ-
ing sending flowers to disgruntled customers, and Zappos even offers a $2,000
bribe to quit the company after training (to weed out the half-hearted). 54 Other
organizations seem to work the other end of the spectrum. Two independent
reports—one on the Transportation Security Administration (TSA) and the
other on airline passenger complaints—argue that low employee morale was
a major factor undermining passenger satisfaction. At US Airways, employees
have posted comments on blogs such as “Our planes (sic) smell filthy” and,
from another, “How can I take pride in this product?” 55
Job Satisfaction and Absenteeism We find a consistent negative relationship
between satisfaction and absenteeism, but it is moderate to weak. 56 While it
certainly makes sense that dissatisfied employees are more likely to miss work,
other factors affect the relationship. Organizations that provide liberal sick leave
benefits are encouraging all their employees—including those who are highly
satisfied—to take days off. You can find work satisfying yet still want to enjoy a
3-day weekend if those days come free with no penalties. When numerous alter-
native jobs are available, dissatisfied employees have high absence rates, but when
there are few they have the same (low) rate of absence as satisfied employees. 57
Job Satisfaction and Turnover The relationship between job satisfaction
and turnover is stronger than between satisfaction and absenteeism. 58 The
satisfaction–turnover relationship also is affected by alternative job prospects. If
an employee is presented with an unsolicited job offer, job dissatisfaction is less
predictive of turnover because the employee is more likely leaving in response
to “pull” (the lure of the other job) than “push” (the unattractiveness of the cur-
rent job). Similarly, job dissatisfaction is more likely to translate into turnover
when employment opportunities are plentiful because employees perceive it is
easy to move. Finally, when employees have high “human capital” (high educa-
tion, high ability), job dissatisfaction is more likely to translate into turnover
because they have, or perceive, many available alternatives. 59
Job Satisfaction and Workplace Deviance Job dissatisfaction and antagonis-
tic relationships with co-workers predict a variety of behaviors organizations
find undesirable, including unionization attempts, substance abuse, stealing
at work, undue socializing, and tardiness. Researchers argue these behaviors
are indicators of a broader syndrome called deviant behavior in the workplace (or
counterproductive behavior or employee withdrawal ). 60 If employees don’t like their
work environment, they’ll respond somehow, though it is not always easy to
forecast exactly how . One worker might quit. Another might use work time to

86 CHAPTER 3 Attitudes and Job Satisfac tion
surf the Internet or take work supplies home for personal use. In short, workers
who don’t like their jobs “get even” in various ways—and because those ways
can be quite creative, controlling only one behavior, such as with an absence
control policy, leaves the root cause untouched. To effectively control the unde-
sirable consequences of job dissatisfaction, employers should attack the source
of the problem—the dissatisfaction—rather than try to control the different
responses.
Managers Often “Don’t Get It” Given the evidence we’ve just reviewed, it
should come as no surprise that job satisfaction can affect the bottom line. One
study by a management consulting firm separated large organizations into high
morale (more than 70 percent of employees expressed overall job satisfaction)
and medium or low morale (fewer than 70 percent). The stock prices of com-
panies in the high-morale group grew 19.4 percent, compared with 10 percent
for the medium- or low-morale group. Despite these results, many managers are
unconcerned about employee job satisfaction. Still others overestimate how sat-
isfied employees are with their jobs, so they don’t think there’s a problem when
there is. In one study of 262 large employers, 86 percent of senior managers be-
lieved their organization treated its employees well, but only 55 percent of em-
ployees agreed. Another study found 55 percent of managers thought morale
was good in their organization, compared to only 38 percent of employees. 61
Regular surveys can reduce gaps between what managers think employees
feel and what they really feel. Jonathan McDaniel, manager of a KFC restaurant
in Houston, surveys his employees every 3 months. Some results led him to
make changes, such as giving employees greater say about which workdays they
have off. However, McDaniel believes the process itself is valuable. “They really
love giving their opinions,” he says. “That’s the most important part of it—that
they have a voice and that they’re heard.” Surveys are no panacea, but if job
attitudes are as important as we believe, organizations need to find out where
they can be improved. 62
When employees do not like
their work environment, they will
respond in some way. An attempt
to form a union is one specific
behavior that may stem from job
dissatisfaction. At several different
Wal-Mart locations throughout the
United States, dissatisfied employ-
ees have tried, unsuccessfully,
to organize a union as a way to
receive better pay and more afford-
able health insurance. Joined by
supporters, the employees shown
here from a Wal-Mart warehouse
and distribution center in California
are protesting low wages and no
health care or other benefits.
So
u
rc
e
:
R
o
b
yn
B
e
ck
/G
e
tt
y
Im
a
g
e
s

Job Satisfaction 87
Employer–Employee Loyalty Is an Outdated Concept
POINT COUNTERPOINT
T
here are employers and employees who show little regard
for each other. That each side can be uncaring or cavalier
is hardly a revelation. No doubt such cynical attitudes are
as old as the employment relationship itself.
But is that the norm? And is it desirable? The answer to both
these questions is “no.”
Says management guru Tom Peters, “Bottom line: loyalty
matters. A lot. Yesterday. Today. Tomorrow.” University of
Michigan’s Dave Ulrich says, “Leaders who encourage loyalty
want employees who are not only committed to and engaged in
their work but who also find meaning from it.”
It is true that the employer–employee relationship has
changed. For example, (largely) gone are the days when em-
ployers provide guaranteed payout pensions to which employ-
ees contribute nothing. But is that such a bad thing? There is a
big difference between asking employees to contribute to their
pension plans and abandoning plans altogether (or firing with-
out cause).
Moreover, it’s not that loyalty is dead, but rather that em-
ployers are loyal to a different kind of employee. Gone are the
days when an employer would refuse to fire a long-tenured but
incompetent employee. But is that the kind of loyalty most em-
ployees expect today anyway? Companies are loyal to employ-
ees who do their jobs well, and that too is as it should be.
In short, employees still expect certain standards of decency
and loyalty from their employers, and employers want engaged,
committed employees in return. That is a good thing—and not
so different from yesterday. Says workplace psychologist Binna
Kandola, “Workplaces may have changed but loyalty is not
dead—the bonds between people are too strong.”
T
he word loyalty is so outdated it is practically laughable.
Long gone are the days when an employer would keep
an employee for life, as are the days when an employee
would work for a single company for his or her entire career.
Workplace guru Linda Gratton says, “Loyalty is dead—killed
off through shortening contracts, outsourcing, automation and
multiple careers. Faced with what could be 50 years of work,
who honestly wants to spend that much time with one com-
pany? Serial monogamy is the order of the day.”
Right or wrong, the commitment on each side of the equa-
tion is weak. Take the example of Renault. The company ended
the 31-year career of employee Michel Balthazard (and two
others) on charges of espionage. The problem? The charges
were proved false. When the falseness of the charges became
public, Renault halfheartedly offered the employees their jobs
back and a lame apology: “Renault thanks them for the quality
of their work at the group and wishes them every success in
the future.”
As for employee’s loyalty to their employers, that too is
worth little nowadays. One manager with Deloitte says the cur-
rent employee attitude is, “I’m leaving, I had a great experience,
and I’m taking that with me.”
Employers tend to cut commitments to an employee, and re-
duce his or her benefits, the minute they perceive they can do
so. Employees tend to jump at the best available job offer as
soon as they see it.
The sooner we see the employment experience for what it is
(mostly transactional, mostly short to medium term), the better
off we’ll be. The workplace is no place for fantasies.
Sources: P. Korkki, “The Shifting Definition of Worker Loyalty,” The New York Times (April 24, 2011), p. BU8; “Is Workplace
Loyalty an Outmoded Concept?” Financial Times (March 8, 2011), www.ft.com/ ; and O. Gough and S. Arkani, “The Impact of the
Shifting Pensions Landscape on the Psychological Contract,” Personnel Review 40, no. 2 (2011), pp. 173–184.

www.ft.com/

88 CHAPTER 3 Attitudes and Job Satisfac tion
MyManagementLab
Now that you have finished this chapter, go back to www.mymanagementlab.com to continue
practicing and applying the concepts you’ve learned.
Managers should be interested in their employees’ attitudes because attitudes
give warnings of potential problems and influence behavior. Creating a satisfied
workforce is hardly a guarantee of successful organizational performance, but
evidence strongly suggests that whatever managers can do to improve employee
attitudes will likely result in heightened organizational effectiveness. Some take-
away lessons from the study of attitudes include the following:
● Satisfied and committed employees have lower rates of turnover, absen-
teeism, and withdrawal behaviors. They also perform better on the job.
Given that managers want to keep resignations and absences down—
especially among their most productive employees—they’ll want to do
things that generate positive job attitudes.
● Managers will also want to measure job attitudes effectively so they can tell
how employees are reacting to their work. As one review put it, “A sound
measurement of overall job attitude is one of the most useful pieces of
information an organization can have about its employees.” 63
● The most important thing managers can do to raise employee satisfaction
is focus on the intrinsic parts of the job, such as making the work chal-
lenging and interesting.
● Although paying employees poorly will likely not attract high-quality
employees to the organization or keep high performers, managers
should realize that high pay alone is unlikely to create a satisfying work
environment.
Summary and Implications for Managers
1 What are the main components of attitudes? Are these
components related or unrelated?
2 Does behavior always follow from attitudes? Why or
why not? Discuss the factors that affect whether behavior
follows from attitudes.
3 What are the major job attitudes? In what ways are
these attitudes alike? What is unique about each?
4 How do we measure job satisfaction?
5 What causes job satisfaction? For most people, is pay or
the work itself more important?
6 What outcomes does job satisfaction influence? What
implications does this have for management?
QUESTIONS FOR REVIEW

www.mymanagementlab.com

Ethical Dilemma 89
EXPERIENTIAL EXERCISE What Factors Are Most Important
to Your Job Satisfaction?
Most of us probably want a job we think will satisfy us.
But because no job is perfect, we often have to trade off
job attributes. One job may pay well but provide limited
opportunities for advancement or skill development.
Another may offer work we enjoy but have poor benefits.
The following is a list of 21 job factors or attributes:
● Autonomy and independence.
● Benefits.
● Career advancement opportunities.
● Career development opportunities.
● Compensation/pay.
● Communication between employees and
management.
● Contribution of work to organization’s business goals.
● Feeling safe in the work environment.
● Flexibility to balance life and work issues.
● Job security.
● Job-specific training.
● Management recognition of employee job
performance.
● Meaningfulness of job.
● Networking.
● Opportunities to use skills/abilities.
● Organization’s commitment to professional
development.
● Overall corporate culture.
● Relationship with co-workers.
● Relationship with immediate supervisor.
● The work itself.
● The variety of work.
On a sheet of paper, rank-order these job factors from
top to bottom so number 1 is the job factor you think is
most important to your job satisfaction, number 2 is the
second most important factor to your job satisfaction, and
so on.
Next, gather in teams of three or four people and try
the following:
1. Appoint a spokesperson who will take notes and re-
port the answers to the following questions, on behalf
of your group, back to the class.
2. Averaging across all members in your group, gener-
ate a list of the top five job factors.
3. Did most people in your group seem to value the
same job factors? Why or why not?
4. Your instructor will provide you the results of a study
of a random sample of 600 employees conducted
by the Society for Human Resource Management
(SHRM). How do your group’s rankings compare
with the SHRM results?
5. The chapter says pay doesn’t correlate all that well
with job satisfaction, but in the SHRM survey, people
say it is relatively important. Can your group suggest a
reason for the apparent discrepancy?
6. Now examine your own list again. Does your list
agree with the group list? Does your list agree with
the SHRM study?
ETHICAL DILEMMA Bounty Hunters
His SUV carefully obscured behind a row of trees, Rick
Raymond, private investigator, was on another case. This
case was not to catch the unfaithful spouse or petty crimi-
nal in action. Instead, Raymond was tracking an employee,
at the request of an employer, to determine whether an
Orlando repairman was sick as he claimed today and as he
had claimed to be several times recently.
As we have seen, absenteeism is a huge problem for or-
ganizations that has left them desperate for solutions. One
solution is to investigate. In the typical routine, when an
employee calls in sick, the employer asks for the reason. If
the reason is illness, and illness has been the reason for an
abnormal number of times in the past, the employer hires
a P.I. to follow the employee and photograph or videotape
his or her activity outside the house. Private investigators
also are used to ascertain whether individuals filing injury
claims (and drawing worker’s compensation benefits) are
in fact injured.
It may surprise you to learn that a recent court deci-
sion indicated hiring a private investigator to follow an
employee is legal. In this particular case, Diana Vail was
fired by Raybestos Products, an automotive parts manufac-
turer in Crawfordsville, Indiana, after an off-duty police of-
ficer hired by Raybestos produced evidence that she was

90 CHAPTER 3 Attitudes and Job Satisfac tion
abusing her sick-leave benefits. The U.S. Court of Appeals
ruled that such investigations were legal.
Despite their legality, such investigations are controver-
sial. Oracle and Hewlett-Packard have reportedly used pri-
vate investigators to follow managers or uncover the source
of leaks. Both actions spawned negative media coverage.
There is no doubt, though, that some employees do
abuse their sick-leave benefits. In an earlier case, Raymond
investigated an employee who called in sick with the
flu for 3 days. Raymond discovered that she actually vis-
ited Orlando theme parks on each of those days. When
Raymond showed her three time-stamped pictures of her-
self on rides, the employee’s first response was, “That’s
not me!” In another case, Raymond caught a worker
constructing an elaborate scheme to call in sick and go
on a cruise. “When he was shown the video surveillance
I’d done, he actually said to his boss, ‘I can’t believe you’d
be so sneaky.’ ” Raymond said. “The hypocrisy is amazing.”
Questions
1. If you had reason to believe someone was lying
about an absence from work, do you think it would
be appropriate to investigate?
2. If excessive absenteeism is a real problem in an or-
ganization, are there alternatives to surveillance? If
so, what are they, and do they have any limitations of
their own?
Sources: E. Spitznagel, “The Sick-Day Bounty Hunters,” Businessweek (December 6, 2010), pp. 93–95;
D. Levine, “Oracle Enlists Private Eyes to Find HP CEO,” Reuters (November 9, 2010), http://in.reuters
.com/ ; and K. Gullo, “HP’s Apotheker, Like Carmen Sandiego, Focus at Trial,” Businessweek
(November 10, 2010), www.businessweek.com/ .
CASE INCIDENT 1 Long Hours, Hundreds of E-Mails, and No Sleep:
Does This Sound Like a Satisfying Job?
In the 1970s, futurists were predicting that increases in
technology would dramatically shorten the workweek for
most people. But in the wired work world of today, where
employees can reach “the office” from wherever they are,
many managers are finding it extremely difficult to get
away from their jobs. In fact, one employment firm es-
timated that 30 percent of professionals take less than
their allotted vacation time, and 42 percent said they
have to cancel vacation plans regularly. Consider a few
examples:
● Gian Paolo Lombardo might work for a firm that man-
ufactures luggage for luxury travel, but he’s had pre-
cious little time for vacationing himself. During his last
“faux-cation” 3 years ago, he spent most of the time in
his hotel room in the resort town of Carmel, California,
with his BlackBerry, while his wife Ellen chatted with
other guests, hoping he’d finally finish with work. Ellen
notes that no meal or movie goes by without her hus-
band being hunched over his smartphone. She says,
“I think he needs to go into rehab.” He agrees.
● Irene Tse heads the government bond-trading divi-
sion at Goldman Sachs. For 10 years, she has seen the
stock market go from all-time highs to recession levels.
Such fluctuations can mean millions of dollars in either
profits or losses. “There are days when you can make a
lot, and other days where you lose so much you’re just
stunned by what you’ve done,” says Tse. She says she
hasn’t slept through the night in years and often wakes
up several times to check the global market status. Her
average workweek? Eighty hours. “I’ve done this for
10 years, and I can count on the fingers of one hand
the number of days in my career when I didn’t want to
come to work. Every day I wake up and I can’t wait to
get here.”
● Tony Kurz is a managing director at Capital Alliance
Partners, and he raises funds for real estate invest-
ments. However, these are not your average proper-
ties. Kurz often flies to exotic locations such as Costa
Rica and Hawaii to woo prospective clients. He travels
more than 300,000 miles per year, often sleeping on
planes and coping with jet lag. Kurz is not the only one
he knows with such a hectic work schedule. His girl-
friend, Avery Baker, logs around 400,000 miles a year
as the senior vice president of marketing for Tommy
Hilfiger. “It’s not easy to maintain a relationship like
this,” says Kurz. But do Kurz and Baker like their jobs?
You bet.
● David Clark is the vice president of global marketing
for MTV. His job often consists of traveling around
the globe to promote the channel as well as to keep
up with the global music scene. If he is not traveling
(Clark typically logs 200,000 miles a year), a typical
day consists of waking at 6:30 a.m. and immediately
responding to numerous messages that have accumu-
lated over the course of the night. He then goes to

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Case Incident 2 91
his office, where throughout the day he responds to
another 500 or so messages from clients around the
world. If he’s lucky, he gets to spend an hour a day
with his son, but then it’s back to work until he finally
goes to bed around midnight. Says Clark, “There are
plenty of people who would love to have this job.
They’re knocking on the door all the time. So that’s
motivating.”
Many individuals would balk at the prospect of a
60-hour or more workweek with constant traveling and
little time for anything else. Some individuals are exhila-
rated by it. But the demands of such jobs are clearly not
for everyone. Many quit, with turnover levels at 55 percent
for consultants and 30 percent for investment bankers, ac-
cording to Vault.com . However, clearly such jobs, while
time-consuming and often stressful, can be satisfying to
some individuals.
Questions
1. Do you think only certain individuals are attracted to
these types of jobs, or is it the characteristics of the
jobs themselves that are satisfying?
2. What characteristics of these jobs might contribute to
increased levels of job satisfaction?
3. Given that the four individuals we just read about
tend to be satisfied with their jobs, how might this sat-
isfaction relate to their job performance, citizenship
behavior, and turnover?
4. Recall David Clark’s statement that “There are plenty
of people who would love to have this job. They’re
knocking on the door all the time.” How might
Clark’s perceptions that he has a job many others
desire contribute to his job satisfaction?
Sources: Based on L. Golden, “A Brief History of Long Work Time and the Contemporary Sources of
Overwork,” Journal of Business Ethics 84, (2009), pp. 217–227; L. Tischler, “Extreme Jobs (And the People
Who Love Them),” Fast Company, April 2005, pp. 55–60, www.glo-jobs.com/article.php?article_no�87 ;
M. Conlin, “Do Us a Favor, Take a Vacation,” Bloomberg Businessweek, May 21, 2007, www.businessweek.com .
CASE INCIDENT 2 Crafting a Better Job
Consider for a moment a midlevel manager at a multi-
national foods company, Fatima, who would seem to be
at the top of her career. She’s consistently making her
required benchmarks and goals, she has built successful
relationships with colleagues, and senior management
have identified her as “high potential.” But she isn’t
happy with her work. She’d be much more interested in
understanding how her organization can use social me-
dia in marketing efforts. Ideally, she’d like to quit and
find something that better suits her passions, but in the
current economic environment this may not be an op-
tion. So she has decided to proactively reconfigure her
current job.
Fatima is part of a movement toward job “crafting,”
which is the process of deliberately reorganizing your job
so that it better fits your motives, strengths, and passions.
The core of job crafting is creating diagrams of day-to-day
activities with a coach. Then you and the coach collabora-
tively identify which tasks fit with your personal passions,
and which tend to drain motivation and satisfaction. Next
the client and coach work together to imagine ways to em-
phasize preferred activities and de-emphasize those that
are less interesting. Many people engaged in job crafting
find that upon deeper consideration, they have more con-
trol over their work than they thought.
So how did Fatima craft her job? She first noticed that
she was spending too much of her time monitoring her
team’s performance and answering team questions, and
not enough time working on the creative projects that
inspire her. She then considered how to modify her rela-
tionship with the team so that these activities incorporated
her passion for social media strategies, with team activities
more centered around developing new marketing. She
also identified members of her team who might be able to
help her implement these new strategies and directed her
interactions with these individuals toward her new goals.
As a result, not only has her engagement in her work in-
creased, but she has also developed new ideas that are be-
ing recognized and advanced within the organization. In
sum, she has found that by actively and creatively examin-
ing her work, she has been able to craft her current job
into one that is truly satisfying.
Questions
1. Why do you think many people are in jobs that are
not satisfying? Do organizations help people craft sat-
isfying and motivating jobs, and if not, why not?
2. Think about how you might reorient yourself to your
own job. Are the principles of job crafting described
above relevant to your work? Why or why not?

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92 CHAPTER 3 Attitudes and Job Satisfac tion
ENDNOTES
1. S. J. Breckler, “Empirical Validation of Affect, Behavior, and
Cognition as Distinct Components of Attitude,” Journal of
Personality and Social Psychology (May 1984), pp. 1191–1205.
2. A. W. Wicker, “Attitude Versus Action: The Relationship of
Verbal and Overt Behavioral Responses to Attitude Objects,”
Journal of Social Issues (Autumn 1969), pp. 41–78.
3. L. Festinger, A Theory of Cognitive Dissonance (Stanford, CA:
Stanford University Press, 1957).
4. See, for instance, L. R. Fabrigar, R. E. Petty, S. M. Smith, and
S. L. Crites, “Understanding Knowledge Effects on Attitude-
Behavior Consistency: The Role of Relevance, Complexity,
and Amount of Knowledge,” Journal of Personality and
Social Psychology 90, no. 4 (2006), pp. 556–577; and D. J.
Schleicher, J. D. Watt, and G. J. Greguras, “Reexamining the
Job Satisfaction-Performance Relationship: The Complexity
of Attitudes,” Journal of Applied Psychology 89, no. 1 (2004),
pp. 165–177.
5. See, for instance, J. Nocera, “If It’s Good for Philip Morris,
Can It Also Be Good for Public Health?” The New York Times
(June 18, 2006).
6. See L. R. Glasman and D. Albarracín, “Forming Attitudes That
Predict Future Behavior: A Meta-Analysis of the Attitude–
Behavior Relation,” Psychological Bulletin (September 2006),
pp. 778–822; I. Ajzen, “Nature and Operation of Attitudes,”
in S. T. Fiske, D. L. Schacter, and C. Zahn-Waxler (eds.),
Annual Review of Psychology, vol. 52 (Palo Alto, CA: Annual
Reviews, Inc., 2001), pp. 27–58; and M. Riketta, “The Causal
Relation Between Job Attitudes and Performance: A Meta-
Analysis of Panel Studies,” Journal of Applied Psychology, 93,
no. 2 (2008), pp. 472–481.
7. Ibid.
8. D. A. Harrison, D. A. Newman, and P. L. Roth, “How
Important Are Job Attitudes? Meta-Analytic Comparisons
o f I n t e g r a t i v e B e h a v i o r a l O u t c o m e s a n d T i m e
Sequences,” Academy of Management Journal 49, no. 2
(2006), pp. 305–325.
9. D. P. Moynihan and S. K. Pandey, “Finding Workable
Levers Over Work Motivation: Comparing Job Satisfaction,
Job Involvement, and Organizational Commitment,”
Administration & Society 39, no. 7 (2007), pp. 803–832.
10. See, for example, J. M. Diefendorff, D. J. Brown, and
A. M. Kamin, “Examining the Roles of Job Involvement and
Work Centrality in Predicting Organizational Citizenship
Behaviors and Job Performance,” Journal of Organizational
Behavior (February 2002), pp. 93–108.
11. Based on G. J. Blau and K. R. Boal, “Conceptualizing How
Job Involvement and Organizational Commitment Affect
Turnover and Absenteeism,” Academy of Management Review
(April 1987), p. 290.
12. G. Chen and R. J. Klimoski, “The Impact of Expectations
on Newcomer Performance in Teams as Mediated by Work
Characteristics, Social Exchanges, and Empowerment,”
Academy of Management Journal 46, no. 5 (2003), pp. 591–607;
A. Ergeneli, G. Saglam, and S. Metin, “Psychological
Empowerment and Its Relationship to Trust in Immediate
Managers,” Journal of Business Research (January 2007),
pp. 41–49; and S. E. Seibert, S. R. Silver, and W. A.
Randolph, “Taking Empowerment to the Next Level: A
Multiple-Level Model of Empowerment, Performance,
and Satisfaction,” Academy of Management Journal 47, no. 3
(2004), pp. 332–349.
13. B. J. Avolio, W. Zhu, W. Koh, and P. Bhatia, “Transformational
Leadership and Organizational Commitment: Mediating
Role of Psychological Empowerment and Moderating Role
of Structural Distance,” Journal of Organizational Behavior 25,
no. 8 (2004), pp. 951–968.
14. J. M. Diefendorff, D. J. Brown, A. M. Kamin, and R. G.
Lord, “Examining the Roles of Job Involvement and
Work Centrality in Predicting Organizational Citizenship
Behaviors and Job Performance,” Journal of Organizational
Behavior (February 2002), pp. 93–108.
15. M. R. Barrick, M. K. Mount, and J. P. Strauss, “Antecedents
of Involuntary Turnover Due to a Reduction in Force,”
Personnel Psychology 47, no. 3 (1994), pp. 515–535.
16. O. N. Solinger, W. van Olffen, and R. A. Roe, “Beyond the
Three-Component Model of Organizational Commitment,”
Journal of Applied Psychology 93 (2008), pp. 70–83.
17. B. J. Hoffman, C. A. Blair, J. P. Meriac, and D. J. Woehr,
“Expanding the Criterion Domain? A Quantitative Review
of the OCB Literature,” Journal of Applied Psychology 92, no. 2
(2007), pp. 555–566.
18. T. A. Wright and D. G. Bonett, “The Moderating Effects of
Employee Tenure on the Relation Between Organizational
Commitment and Job Performance: A Meta-Analysis,” Journal
of Applied Psychology (December 2002), pp. 1183–1190.
19. T. W. H. Ng, D. C. Feldman, and S. S. K. Lam, “Psychological
Contract Breaches, Organizational Commitment, and
Innovation-Related Behaviors: A Latent Growth Modeling
Sources: Based on A. Wrzesniewski, J. M. Berg, and J. E. Dutton, “Turn the Job You Have into the Job You Want,”
Harvard Business Review (June 2010), pp. 114–117; A. Wrzesniewski and J. E. Dutton, “Crafting a Job: Revisioning
Employees as Active Crafters of Their Work,” Academy of Management Review 26 (2010), pp. 179–201; and
J. Caplan, “Hate Your Job? Here’s How to Reshape It,” Time (December 4, 2009), www.time.com .
3. Some contend that job crafting sounds good in
principle but is not necessarily available to everyone.
What types of jobs are probably not amenable to job
crafting activities?
4. Are there any potential drawbacks to the job
crafting approach? How can these concerns be
minimized?

www.time.com

Endnotes 93
Approach,” Journal of Applied Psychology 95 (2010),
pp. 744–751.
20. See, for instance, K. Bentein, C. Vandenberghe,
R. Vandenberg, and F. Stinglhamber, “The Role of Change
in the Relationship between Commitment and Turnover:
A Latent Growth Modeling Approach,” Journal of Applied
Psychology 90 (2005), pp. 468–482; and J. D. Kammeyer-
Mueller, C. R. Wanberg, T. M. Glomb, and D. Ahlburg,
“The Role of Temporal Shifts in Turnover Processes:
It’s About Time.” Journal of Applied Psychology 90 (2005),
pp. 644–658.
21. J. P. Hausknecht, N. J. Hiller, and R. J. Vance, “Work-Unit
Absenteeism: Effects of Satisfaction, Commitment, Labor
Market Conditions, and Time,” Academy of Management
Journal 51 (2008), pp. 1223–1245.
22. L. Rhoades, R. Eisenberger, and S. Armeli, “Affective
Commitment to the Organization: The Contribution
of Perceived Organizational Support,” Journal of Applied
Psychology 86, no. 5 (2001), pp. 825–836.
23. C. Vandenberghe, K. Bentein, R. Michon, J. Chebat,
M. Tremblay, and J. Fils, “An Examination of the Role
of Perceived Support and Employee Commitment in
Employee–Customer Encounters,” Journal of Applied
Psychology 92, no. 4 (2007), pp. 1177–1187; and
P. Eder and R. Eisenberger, “Perceived Organizational
Support: Reducing the Negative Influence of Coworker
Withdrawal Behavior,” Journal of Management 34, no. 1
(2008), pp. 55–68.
24. J. Farh, R. D. Hackett, and J. Liang, “Individual-Level Cultural
Values as Moderators of Perceived Organizational Support—
Employee Outcome Relationships in China: Comparing the
Effects of Power Distance and Traditionality,” Academy of
Management Journal 50, no. 3 (2007), pp. 715–729.
25. B. L. Rich, J. A. Lepine, and E. R. Crawford, “Job
Engagement: Antecedents and Effects on Job Performance,”
Academy of Management Journal 53 (2010), pp. 617–635.
26. J. K. Harter, F. L. Schmidt, and T. L. Hayes, “Business-
Unit-Level Relationship Between Employee Satisfaction,
Employee Engagement, and Business Outcomes: A Meta-
Analysis,” Journal of Applied Psychology 87, no. 2 (2002),
pp. 268–279.
27. N. R. Lockwood, Leveraging Employee Engagement for
Competitive Advantage (Alexandria, VA: Society for Human
Resource Management, 2007); and R. J. Vance, Employee
Engagement and Commitment (Alexandria, VA: Society for
Human Resource Management, 2006).
28. W. H. Macey and B. Schneider, “The Meaning of
Employee Engagement,” Industrial and Organizational
Psychology 1 (2008), pp. 3–30; A. Saks, “The Meaning and
Bleeding of Employee Engagement: How Muddy Is The
Water?” Industrial and Organizational Psychology 1 (2008),
pp. 40–43.
29. L. Rhoades and R. Eisenberger, “Perceived Organizational
Support: A Review of the Literature,” Journal of Applied
Psychology 87, no. 4 (2002), pp. 698–714; and R. L. Payne and
D. Morrison, “The Differential Effects of Negative Affectivity
on Measures of Well-Being Versus Job Satisfaction and
Organizational Commitment,” Anxiety, Stress & Coping: An
International Journal 15, no. 3 (2002), pp. 231–244.
30. For problems with the concept of job satisfaction, see
R. Hodson, “Workplace Behaviors,” Work and Occupations
(August 1991), pp. 271–290; and H. M. Weiss and
R. Cropanzano, “Affective Events Theory: A Theoretical
Discussion of the Structure, Causes and Consequences
of Affective Experiences at Work,” in B. M. Staw and L. L.
Cummings (eds.), Research in Organizational Behavior, vol. 18
(Greenwich, CT: JAI Press, 1996), pp. 1–3.
31. The Wyatt Company’s 1989 national WorkAmerica study
identified 12 dimensions of satisfaction: Work organiza-
tion, working conditions, communications, job performance
and performance review, co-workers, supervision, company
management, pay, benefits, career development and train-
ing, job content and satisfaction, and company image and
change.
32. See E. Spector, Job Satisfaction: Application, Assessment, Causes,
and Consequences (Thousand Oaks, CA: Sage, 1997), p. 3.
33. J. Wanous, A. E. Reichers, and M. J. Hudy, “Overall Job
Satisfaction: How Good Are Single-Item Measures?” Journal
of Applied Psychology (April 1997), pp. 247–252.
34. A. F. Chelte, J. Wright, and C. Tausky, “Did Job Satisfaction
Really Drop During the 1970s?” Monthly Labor Review
(November 1982), pp. 33–36; “Job Satisfaction High in
America, Says Conference Board Study,” Monthly Labor
Review (February 1985), p. 52; K. Bowman, “Attitudes About
Work, Chores, and Leisure in America,” AEI Opinion Studies
(August 25, 2003); and J. Pepitone, “U.S. Job Satisfaction
Hits 22-Year Low,” CNNMoney.com (January 5, 2010).
35. W. K. Balzer, J. A. Kihm, P. C. Smith, J. L. Irwin, P. D.
Bachiochi, C. Robie, E. F. Sinar, and L. F. Parra, Users’
Manual for the Job Descriptive Index (JDI; 1997 Revision) and
the Job in General Scales (Bowling Green, OH: Bowling Green
State University, 1997).
36. M. J. Gelfand, M. Erez, and Z. Aycan, “Cross-Cultural
Organizational Behavior,” Annual Review of Psychology 58
(2007), pp. 479–514; and A. S. Tsui, S. S. Nifadkar, and A. Y.
Ou, “Cross-National, Cross-Cultural Organizational Behavior
Research: Advances, Gaps, and Recommendations,” Journal
of Management (June 2007), pp. 426–478.
37. M. Benz and B. S. Frey, “The Value of Autonomy: Evidence
from the Self-Employed in 23 Countries,” working paper 173,
Institute for Empirical Research in Economics, University of
Zurich, November 2003 ( ssrn.com/abstract�475140 ); and
P. Warr, Work, Happiness, and Unhappiness (Mahwah, NJ:
Laurence Erlbaum, 2007).
38. J. Barling, E. K. Kelloway, and R. D. Iverson, “High-Quality
Work, Job Satisfaction, and Occupational Injuries,” Journal
of Applied Psychology 88, no. 2 (2003), pp. 276–283; and
F. W. Bond and D. Bunce, “The Role of Acceptance and
Job Control in Mental Health, Job Satisfaction, and Work
Performance,” Journal of Applied Psychology 88, no. 6 (2003),
pp. 1057–1067.
39. S. E. Humphrey, J. D. Nahrgang, and F. P. Morgeson,
“Integrating Motivational, Social, and Contextual Work
Design Features: A Meta-Analytic Summary and Theoretical
Extension of the Work Design Literature,” Journal of Applied
Psychology 92, no. 5 (2007), pp. 1332–1356; and D. S.
Chiaburu and D. A. Harrison, “Do Peers Make the Place?
Conceptual Synthesis and Meta-Analysis of Coworker Effect

94 CHAPTER 3 Attitudes and Job Satisfac tion
on Perceptions, Attitudes, OCBs, and Performance,” Journal
of Applied Psychology 93, no. 5 (2008), pp. 1082–1103.
40. E. Diener, E. Sandvik, L. Seidlitz, and M. Diener, “The
Relationship Between Income and Subjective Well-Being:
Relative or Absolute?” Social Indicators Research 28 (1993),
pp. 195–223.
41. E. Diener and M. E. P. Seligman, “Beyond Money: Toward
an Economy of Well-Being,” Psychological Science in the Public
Interest 5, no. 1 (2004), pp. 1–31; and A. Grant, “Money �
Happiness? That’s Rich: Here’s the Science Behind the
Axiom,” The (South Mississippi) Sun Herald (January 8, 2005).
42. T. A. Judge and C. Hurst, “The Benefits and Possible Costs
of Positive Core Self-Evaluations: A Review and Agenda
for Future Research,” in D. Nelson and C. L. Cooper
(eds.), Positive Organizational Behavior (London, UK: Sage
Publications, 2007), pp. 159–174.
43. See D. Farrell, “Exit, Voice, Loyalty, and Neglect as
Responses to Job Dissatisfaction: A Multidimensional
Scaling Study,” Academy of Management Journal (December
1983), pp. 596–606; C. E. Rusbult, D. Farrell, G. Rogers,
and A. G. Mainous III, “Impact of Exchange Variables on
Exit, Voice, Loyalty, and Neglect: An Integrative Model
of Responses to Declining Job Satisfaction,” Academy of
Management Journal (September 1988), pp. 599–627; M. J.
Withey and W. H. Cooper, “Predicting Exit, Voice, Loyalty,
and Neglect,” Administrative Science Quarterly (December
1989), pp. 521–539; J. Zhou and J. M. George, “When
Job Dissatisfaction Leads to Creativity: Encouraging the
Expression of Voice,” Academy of Management Journal
(August 2001), pp. 682–696; J. B. Olson-Buchanan and
W. R. Boswell, “The Role of Employee Loyalty and Formality
in Voicing Discontent,” Journal of Applied Psychology
(December 2002), pp. 1167–1174; and A. Davis-Blake, J. P.
Broschak, and E. George, “Happy Together? How Using
Nonstandard Workers Affects Exit, Voice, and Loyalty
Among Standard Employees,” Academy of Management
Journal 46, no. 4 (2003), pp. 475–485.
44. R. B. Freeman, “Job Satisfaction as an Economic Variable,”
American Economic Review (January 1978), pp. 135–141.
45. T. A. Judge, C. J. Thoresen, J. E. Bono, and G. K. Patton,
“The Job Satisfaction–Job Performance Relationship: A
Qualitative and Quantitative Review,” Psychological Bulletin
(May 2001), pp. 376–407.
46. C. Ostroff, “The Relationship Between Satisfaction, Attitudes,
and Performance: An Organizational Level Analysis,”
Journal of Applied Psychology (December 1992), pp. 963–974;
A. M. Ryan, M. J. Schmit, and R. Johnson, “Attitudes and
Effectiveness: Examining Relations at an Organizational
Level,” Personnel Psychology (Winter 1996), pp. 853–882;
and J. K. Harter, F. L. Schmidt, and T. L. Hayes, “Business-
Unit Level Relationship Between Employee Satisfaction,
Employee Engagement, and Business Outcomes: A
Meta-Analysis,” Journal of Applied Psychology (April 2002),
pp. 268–279.
47. See P. Podsakoff, S. B. MacKenzie, J. B. Paine, and D. G.
Bachrach, “Organizational Citizenship Behaviors: A Critical
Review of the Theoretical and Empirical Literature and
Suggestions for Future Research,” Journal of Management 26,
no. 3 (2000), pp. 513–563.
48. B. J. Hoffman, C. A. Blair, J. P. Maeriac, and D. J. Woehr,
“Expanding the Criterion Domain? A Quantitative Review
of the OCB Literature,” Journal of Applied Psychology 92, no. 2
(2007), pp. 555–566.
49. S. L. Blader and T. R. Tyler, “Testing and Extending the
Group Engagement Model: Linkages Between Social
Identity, Procedural Justice, Economic Outcomes, and
Extrarole Behavior,” Journal of Applied Psychology 94, no. 2
(2009), pp. 445–464.
50. D. S. Chiaburu and D. A. Harrison, “Do Peers Make the
Place? Conceptual Synthesis and Meta-Analysis of Coworker
Effect on Perceptions, Attitudes, OCBs, and Performance,”
Journal of Applied Psychology 93, no. 5 (2008), pp. 1082–1103.
51. R. Ilies, I. S. Fulmer, M. Spitzmuller, and M. D. Johnson,
“Personality and Citizenship Behavior: The Mediating Role
of Job Satisfaction,” Journal of Applied Psychology 94 (2009),
pp. 945–959.
52. R. Ilies, B. A. Scott, and T. A. Judge, “The Interactive Effects
of Personal Traits and Experienced States on Intraindividual
Patterns of Citizenship Behavior,” Academy of Management
Journal 49 (2006), pp. 561–575.
53. See, for instance, D. J. Koys, “The Effects of Employee
Satisfaction, Organizational Citizenship Behavior, and
Turnover on Organizational Effectiveness: A Unit-Level,
Longitudinal Study,” Personnel Psychology (Spring 2001),
pp. 101–114; and C. Vandenberghe, K. Bentein, R. Michon,
J. Chebat, M. Tremblay, and J. Fils, “An Examination
of the Role of Perceived Support and Employee
Commitment in Employee-Customer Encounters,” Journal
of Applied Psychology 92, no. 4 (2007), pp. 1177–1187; and
M. Schulte, C. Ostroff, S. Shmulyian, and A. Kinicki,
“Organizational Climate Configurations: Relationships to
Collective Attitudes, Customer Satisfaction, and Financial
Performance,” Journal of Applied Psychology 94 (2009),
pp. 618–634.
54. J. M. O’Brien, “Zappos Knows How to Kick It,” Fortune
(February 2, 2009), pp. 55–60.
55. T. Frank, “Report: Low Morale May Hurt Airport Security,”
USA Today (June 25, 2008), p. 3A; and J. Bailey, “Fliers Fed
Up? The Employees Feel the Same,” The New York Times
(December 22, 2007), pp. A1, A18.
56. E. A. Locke, “The Nature and Causes of Job Satisfaction,”
in M. D. Dunnette (ed.), Handbook of Industrial and
Organizational Psychology (Chicago: Rand McNally, 1976),
p. 1331; K. D. Scott and G. S. Taylor, “An Examination
of Conflicting Findings on the Relationship Between Job
Satisfaction and Absenteeism: A Meta-Analysis,” Academy
of Management Journal (September 1985), pp. 599–612; and
R. Steel and J. R. Rentsch, “Influence of Cumulation Strategies
on the Long-Range Prediction of Absenteeism,” Academy of
Management Journal (December 1995), pp. 1616–1634.
57. J. P. Hausknecht, N. J. Hiller, and R. J. Vance, “Work-Unit
Absenteeism: Effects of Satisfaction, Commitment, Labor
Market Conditions, and Time,” Academy of Management
Journal 51, no. 6 (2008), pp. 1123–1245.
58. W. Hom and R. W. Griffeth, Employee Turnover (Cincinnati,
OH: South-Western Publishing, 1995); R. W. Griffeth, P. W.
Hom, and S. Gaertner, “A Meta-Analysis of Antecedents
and Correlates of Employee Turnover: Update, Moderator

Endnotes 95
Tests, and Research Implications for the Next Millennium,”
Journal of Management 26, no. 3 (2000), p. 479.
59. T. H. Lee, B. Gerhart, I. Weller, and C. O. Trevor,
“Understanding Voluntary Turnover: Path-Specific Job
Satisfaction Effects and the Importance of Unsolicited Job
Offers,” Academy of Management Journal 51, no. 4 (2008),
pp. 651–671.
60. P. E. Spector, S. Fox, L. M. Penney, K. Bruursema, A. Goh,
and S. Kessler, “The Dimensionality of Counterproductivity:
Are All Counterproductive Behaviors Created Equal?”
Journal of Vocational Behavior 68, no. 3 (2006), pp. 446–460;
and D. S. Chiaburu and D. A. Harrison, “Do Peers Make the
Place? Conceptual Synthesis and Meta-Analysis of Coworker
Effect on Perceptions, Attitudes, OCBs, and Performance,”
Journal of Applied Psychology 93, no. 5 (2008), pp. 1082–1103.
61. K. Holland, “Inside the Minds of Your Employees,” The
New York Times (January 28, 2007), p. B1; “Study Sees Link
Between Morale and Stock Price,” Workforce Management
(February 27, 2006), p. 15; and “The Workplace as a Solar
System,” The New York Times (October 28, 2006), p. B5.
62. E. White, “How Surveying Workers Can Pay Off,” The Wall
Street Journal (June 18, 2007), p. B3.
63. Harrison, D. A., Newman, D. A., & Roth, P. L., How impor-
tant are job attitudes?: Meta-analytic comparisons for inte-
grative behavioral outcomes and time sequences. Academy of
Management Journal, no. 49 (2006), pp. 320–321.

LOVE AT WORK: TABOO NO MORE?
96
A
t one time, workplace romances were a taboo topic. When they
were discussed by organizations, it was often by means of a memo
outlining the policy against such liaisons among co-workers.
Though the motivations behind such policies were not evil—mostly,
it was a desire to avoid sexual harassment lawsuits emanating from one
employee’s amorous pursuit of another—they also overlooked a real prob-
lem: a large percentage of couples first met in the workplace, and for many
reasons, work is a great place to meet a future mate.
In one 2011 survey of 3,900 workers, nearly 20 percent indicated they had
dated co-workers at least twice in their working career, and about one-third
of those who did ended up marrying a person they dated at work. What’s
more—65 percent of those who date someone at work say they are open
about it at work.
Nathan Shaw and Maiko Sato met at a Cisco training program. For two
years, they dated openly as fellow employees. When Nathan decided to
propose to Maiko, he asked his boss to help with a ruse. During a fake test of
teleconferencing equipment, Nathan’s proposal flashed on the screen. Maiko
said yes, and they remain happily married and working at Cisco’s San Jose,
CA, headquarters.
To Stacie Taylor, who has been dating Cary Costello, a fellow employee
of Zoot Enterprises (a Bozeman, Montana, technical services provider), for
more than 3 years, finding a mate at work is logical. “People spend so much
of their time working that it’s unavoidable,” she said. Cary adds, “If you’re
around a bunch of like-minded people who have similar interests, it’s bound
to happen.”
There are risks. When 27-year-old Arti Banerjee’s relationship with her
co-worker went sour, her ex-boyfriend started spreading rumors about her
in the office and on Facebook. He forwarded some of her text messages to
co-workers. After two months, Banerjee quit.
Another risk is violations of privacy. Some employees—to protect their
privacy or from fear of their organization’s reaction—try to keep their
relationship under wraps. It generally doesn’t work. When GMR Marketing
co-workers Michelle Walters and Ryan Scholz began dating, they hid their
relationship, only to be found out. As it turns out, they had nothing to
fear. Their boss, Gary Reynolds, says GMR has no dating policy: “Why try to
mandate behavior and develop policy when you don’t need it?”
Sources: S. Shallenbarger, “For Office Romance, The Secret’s Out,” The Wall Street Journal
(February 10, 2010), pp. D1–D2; “Survey: Workplace Dating Losing Stigma,” UPI (February 13,
2011), www.upi.com ; R. T. Sharma, “How to Handle an Office Romance, Especially after a Messy
Breakup,” Economic Times (May 1, 2011), http://economictimes.indiatimes.com/ .
LEARNING
OBJECTIVES
After studying this chapter,
you should be able to:
1 Differentiate emotions from
moods and list the basic
emotions and moods.
2 Discuss whether emotions
are rational and what
functions they serve.
3 Identify the sources of
emotions and moods.
4 Show the impact emotional
labor has on employees.
5 Describe affective events
theory and identify its
applications.
6 Contrast the evidence for
and against the existence
of emotional intelligence.
7 Identify strategies for
emotion regulation and
their likely effects.
8 Apply concepts about
emotions and moods to
specific OB issues.
MyManagementLab
Access a host of interactive
learning aids to help strengthen
your understanding of the
chapter concepts at
www.mymanagementlab.com

www.mymanagementlab.com

www.upi.com

http://economictimes.indiatimes.com/

Emotions
and Moods 4
Time cools, time clarifies; no mood can be
maintained quite unaltered
through the course of hours. —Mark Twain
Ph
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ho
to
. S
ou
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e:
©
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97

98 CHAPTER 4 Emotions and Moods
A s the preceding stories illustrate, emotions can be an important part of the way people behave at work. Given the obvious role emotions play in our lives, it might surprise you that, until recently, the field of OB has given
the topic of emotions little attention. 1 Why? We offer two possible explanations.
First is the myth of rationality. 2 Until very recently, the protocol of the work
world kept a damper on emotions. A well-run organization didn’t allow employ-
ees to express frustration, fear, anger, love, hate, joy, grief, or similar feelings
thought to be the antithesis of rationality. Though researchers and managers
knew emotions were an inseparable part of everyday life, they tried to create
organizations that were emotion-free. Of course, that wasn’t possible.
The second explanation is that many believed emotions of any kind were dis-
ruptive. 3 Researchers looked at strong negative emotions—especially anger—
that interfered with an employee’s ability to work effectively. They rarely viewed
emotions as constructive or contributing to enhanced performance.
Certainly some emotions, particularly exhibited at the wrong time, can
hinder performance. But employees do bring their emotions to work every day,
and no study of OB would be comprehensive without considering their role in
workplace behavior.
How Are You Feeling Right Now?
In the Self-Assessment Library (available on CD or online), take assessment
IV.D.1 (How Are You Feeling Right Now?) and answer the following questions.
1. What was higher—your positive mood score or negative mood score? How
do these scores compare with those of your classmates?
2. Did your score surprise you? Why or why not?
3. What sorts of things influence your positive moods, your negative moods?
S A L
SELF-ASSESSMENT LIBRARY
In our analysis, we’ll need three terms that are closely intertwined: affect,
emotions, and moods.
Affect is a generic term that covers a broad range of feelings people experience,
including both emotions and moods. 4 Emotions are intense feelings directed at
someone or something. 5 Moods are less intense feelings than emotions and often
(though not always) arise without a specific event acting as a stimulus. 6
Most experts believe emotions are more fleeting than moods. 7 For example,
if someone is rude to you, you’ll feel angry. That intense feeling probably comes
and goes fairly quickly, maybe even in a matter of seconds. When you’re in a
bad mood, though, you can feel bad for several hours.
Emotions are reactions to a person (seeing a friend at work may make you
feel glad) or an event (dealing with a rude client may make you feel frustrated).
You show your emotions when you’re “happy about something, angry at some-
one, afraid of something.” 8 Moods, in contrast, aren’t usually directed at a
person or an event. But emotions can turn into moods when you lose focus on
the event or object that started the feeling. And, by the same token, good or
bad moods can make you more emotional in response to an event. So when a
colleague criticizes how you spoke to a client, you might show emotion (anger)
What Are Emotions and Moods?
1 Differentiate emotions from
moods and list the basic
emotions and moods.

What Are Emotions and Moods? 99
toward a specific object (your colleague). But as the specific emotion dissipates,
you might just feel generally dispirited. You can’t attribute this feeling to any
single event; you’re just not your normal self. You might then overreact to other
events. This affect state describes a mood. Exhibit 4-1 shows the relationships
among affect, emotions, and mood.
First, as the exhibit shows, affect is a broad term that encompasses emotions
and moods. Second, there are differences between emotions and moods. Some
of these differences—that emotions are more likely to be caused by a specific
event, and emotions are more fleeting than moods—we just discussed. Other
differences are subtler. For example, unlike moods, emotions like anger and
disgust tend to be more clearly revealed by facial expressions. Also, some re-
searchers speculate that emotions may be more action-oriented—they may lead
us to some immediate action—while moods may be more cognitive, meaning
they may cause us to think or brood for a while. 9
Finally, the exhibit shows that emotions and moods are closely connected and
can influence each other. Getting your dream job may generate the emotion of
joy, which can put you in a good mood for several days. Similarly, if you’re in a
good or bad mood, it might make you experience a more intense positive or neg-
ative emotion than otherwise. In a bad mood, you might blow up in response to
a co-worker’s comment that would normally have generated only a mild reaction.
Affect, emotions, and moods are separable in theory; in practice the distinc-
tion isn’t always crystal-clear. In some areas, researchers have studied mostly
moods, in other areas mainly emotions. So, when we review the OB topics on
emotions and moods, you may see more information about emotions in one
area and about moods in another. This is simply the state of the research.
affect A broad range of feelings that
people experience.
emotions Intense feelings that are
directed at someone or something.
moods Feelings that tend to be less
intense than emotions and that lack a
contextual stimulus.
Affect, Emotions, and Moods Exhibit 4-1
Emotions
• Caused by specific event
• Very brief in duration (seconds
or minutes)
• Specific and numerous in nature
(many specific emotions such as
anger, fear, sadness, happiness,
disgust, surprise)
• Usually accompanied by distinct
facial expressions
• Action oriented in nature
Moods
• Cause is often general and unclear
• Last longer than emotions (hours
or days)
• More general (two main dimensions—
positive affect and negative affect—
that are composed of multiple specific
emotions)
• Generally not indicated by distinct
expressions
• Cognitive in nature
Affect
Defined as a broad range of feelings that people experience.
Affect can be experienced in the form of emotions or moods.

100 CHAPTER 4 Emotions and Moods
The Basic Emotions
How many emotions are there? There are dozens, including anger, contempt,
enthusiasm, envy, fear, frustration, disappointment, embarrassment, disgust,
happiness, hate, hope, jealousy, joy, love, pride, surprise, and sadness. Numerous
researchers have tried to limit them to a fundamental set. 10 But some argue that
it makes no sense to think in terms of “basic” emotions because even emotions
we rarely experience, such as shock, can have a powerful effect on us. 11 Other
researchers, even philosophers, say there are universal emotions common to
all. René Descartes, often called the founder of modern philosophy, identi-
fied six “simple and primitive passions”— wonder, love, hatred, desire, joy, and
sadness—and argued that “all the others are composed of some of these six or
are species of them.” 12 Although other philosophers like Hume, Hobbes, and
Spinoza identified categories of emotions, proof of the existence of a basic set
of emotions still waits for contemporary researchers.
Psychologists have tried to identify basic emotions by studying facial expres-
sions. 13 One problem is that some emotions are too complex to be easily repre-
sented on our faces. Many think of love as the most universal of all emotions, 14 for
example, yet it’s not easy to express it through only a facial expression. Cultures
also have norms that govern emotional expression, so the way we experience an emo-
tion isn’t always the same as the way we show it. People in the United States and the
Middle East recognize a smile as indicating happiness, but in the Middle East a smile
is also more likely to be seen as a sign of sexual attraction, so women have learned
not to smile at men. 15 In collectivist countries people are more likely to believe
another’s emotional displays have something to do with the relationship between
them, while people in individualistic cultures don’t think others’ emotional expres-
sions are directed at them. French retail clerks, in contrast, are infamous for being
surly toward customers (as a report from the French government itself confirmed).
Serious German shoppers have reportedly been turned off by Walmart’s friendly
greeters and helpful staff. 16 And many companies today offer anger- management
programs to teach people to contain or even hide their inner feelings. 17
It’s unlikely psychologists or philosophers will ever completely agree on a set
of basic emotions, or even on whether there is such a thing. Still, many research-
ers agree on six essentially universal emotions—anger, fear, sadness, happiness,
disgust, and surprise. 18 Some even plot them along a continuum: happiness—
surprise—fear—sadness—anger—disgust. 19 The closer two emotions are to each
other on this continuum, the more likely people will confuse them. We sometimes
mistake happiness for surprise, but rarely do we confuse happiness and disgust. In
addition, as we’ll see later on, cultural factors can also influence interpretations.
The Basic Moods: Positive and Negative Affect
One way to classify emotions is by whether they are positive or negative. 20
Positive emotions—such as joy and gratitude—express a favorable evaluation or
feeling. Negative emotions—such as anger or guilt—express the opposite. Keep
in mind that emotions can’t be neutral. Being neutral is being nonemotional. 21
When we group emotions into positive and negative categories, they become
mood states because we are now looking at them more generally instead of isolating
one particular emotion. In Exhibit 4-2 , excited is a pure marker of high positive af-
fect, while boredom is a pure marker of low positive affect. Nervous is a pure marker
of high negative affect; relaxed is a pure marker of low negative affect. Finally, some
emotions—such as contentment (a mixture of high positive affect and low negative
affect) and sadness (a mixture of low positive affect and high negative affect)—are
in between. You’ll notice this model does not include all emotions. Some, such as
surprise, don’t fit well because they’re not as clearly positive or negative.

What Are Emotions and Moods? 101
So, we can think of positive affect as a mood dimension consisting of posi-
tive emotions such as excitement, self-assurance, and cheerfulness at the high
end and boredom, sluggishness, and tiredness at the low end. Negative affect
is a mood dimension consisting of nervousness, stress, and anxiety at the high
end and relaxation, tranquility, and poise at the low end. ( Note: Positive and
negative affect are moods. We’re using these labels, rather than positive mood and
negative mood, because that’s how researchers label them.)
Positive affect and negative affect play out at work and beyond in that they
color our perceptions, and these perceptions can become their own reality. One
flight attendant posted an anonymous blog on the Web that said, “I work in a
pressurized aluminum tube and the environment outside my ‘office’ cannot
sustain human life. That being said, the human life inside is not worth sustain-
ing sometimes . . . in fact, the passengers can be jerks, and idiots. I am often
treated with no respect, nobody listens to me . . . until I threaten to kick them
off the plane.” 22 Clearly, if a flight attendant is in a bad mood, it’s going to influ-
ence his perceptions of passengers, which will, in turn, influence his behavior.
Negative emotions are likely to translate into negative moods. People think
about events that created strong negative emotions five times as long as they do
about events that created strong positive ones. 23 So, we should expect people
to recall negative experiences more readily than positive ones. Perhaps one rea-
son is that, for most of us, negative experiences also are more unusual. Indeed,
research finds a positivity offset , meaning that at zero input (when nothing in
particular is going on), most individuals experience a mildly positive mood. 24
So, for most people, positive moods are somewhat more common than nega-
tive moods. The positivity offset also appears to operate at work. One study of
The Structure of Mood Exhibit 4-2
High Negative
Affect
Low Negative
Affect
High Positive
Affect
Low Positive
Affect
Tense Alert
Excited
Elated
Happy
Content
Serene
Relaxed
CalmFatigued
Bored
Depressed
Sad
Upset
Stressed
Nervous
positive affect A mood dimension that
consists of specific positive emotions
such as excitement, self-assurance,
and cheerfulness at the high end and
boredom, sluggishness, and tiredness
at the low end.
negative affect A mood dimension
that consists of emotions such as
nervousness, stress, and anxiety at the
high end and relaxation, tranquility,
and poise at the low end.
positivity offset The tendency of most
individuals to experience a mildly
positive mood at zero input (when
nothing in particular is going on).

102 CHAPTER 4 Emotions and Moods
customer-service representatives in a British call center (a job where it’s proba-
bly pretty difficult to feel positive) revealed people reported experiencing posi-
tive moods 58 percent of the time. 25
Does the degree to which people experience these positive and nega-
tive emotions vary across cultures? Yes. In China, people report experienc-
ing fewer positive and negative emotions than people in other cultures, and
the emotions they experience are less intense. Compared with Mainland
Chinese, Taiwanese are more like U.S. workers in their experience of emo-
tions: on average, they report more positive and fewer negative emotions
than their Chinese counterparts. 26 People in most cultures appear to ex-
perience certain positive and negative emotions, but the frequency and in-
tensity varies to some degree. 27 Despite these differences, people from all
over the world interpret negative and positive emotions in much the same
way. We all view negative emotions, such as hate, terror, and rage, as dan-
gerous and destructive, and we desire positive emotions, such as joy, love,
and happiness. However, some cultures value certain emotions more than
others. U.S. culture values enthusiasm, while the Chinese consider negative
emotions more useful and constructive than do people in the United States.
Pride is generally a positive emotion in Western individualistic cultures such
as the United States, but Eastern cultures such as China and Japan view pride
as undesirable. 28
The Function of Emotions
Do Emotions Make Us Irrational? How often have you heard someone say
“Oh, you’re just being emotional”? You might have been offended. The fa-
mous astronomer Carl Sagan once wrote, “Where we have strong emotions,
we’re liable to fool ourselves.” These observations suggest rationality and
emotion are in conflict, and that if you exhibit emotion you are likely to
act irrationally. One team of authors argues that displaying emotions such
as sadness to the point of crying is so toxic to a career that we should leave
the room rather than allow others to witness it. 29 These perspectives suggest
the demonstration or even experience of emotions can make us seem weak,
brittle, or irrational. However, research is increasingly showing that emotions
are actually critical to rational thinking. 30 There has been evidence of such a
link for a long time.
Consider Phineas Gage, a railroad worker in Vermont. One September
day in 1848, while Gage was setting an explosive charge at work, a 3-foot
7-inch iron bar flew into his lower-left jaw and out through the top of his
skull. Remarkably, Gage survived his injury. He was still able to read and
speak, and he per formed well above average on cognitive ability tests.
However, it became clear he had lost his ability to experience emotion; he
was emotionless at even the saddest misfortunes or the happiest occasions.
Gage’s inability to express emotion eventually took away his ability to
reason. He started making irrational choices about his life, often behaving
erratically and against his self-interests. Despite being an intelligent man
whose intellectual abilities were unharmed by the accident, Gage drifted
from job to job, eventually taking up with a circus. In commenting on
Gage’s condition, one expert noted, “Reason may not be as pure as most of
us think it is or wish it were . . . emotions and feelings may not be intruders
in the bastion of reason at all: they may be enmeshed in its networks, for
worse and for better.” 31
The example of Phineas Gage and many other brain injury studies show
emotions are critical to rational thinking. We must have the ability to experi-
ence emotions to be rational. Why? Because our emotions provide important
2 Discuss whether emotions
are rational and what
functions they serve.

What Are Emotions and Moods? 103
information about how we understand the world around us. Would we really
want a manager to make a decision about firing an employee without regarding
either his or the employee’s emotions? The key to good decision making is to
employ both thinking and feeling in our decisions.
Do Emotions Make Us Ethical? A growing body of research has begun to exam-
ine the relationship between emotions and moral attitudes. 32 It was previously
believed that, like decision making in general, most ethical decision making
was based on higher-order cognitive processes, but research on moral emotions
increasingly questions this perspective. Examples of moral emotions include
sympathy for the suffering of others, guilt about our own immoral behavior, an-
ger about injustice done to others, contempt for those who behave unethically,
and disgust at violations of moral norms. Numerous studies suggest that these
reactions are largely based on feelings rather than cold cognition.
You can think about this research in your own life to see how the emotional
model of ethics operates. Consider the massive earthquake that struck Japan
in 2011. When you heard about it, did you feel emotionally upset about the
suffering of others, or did you make more of a rational calculation about their
unfortunate situation? Consider a time when you have done something that
hurt someone else. Did you feel angry or upset with yourself? Or think about a
time when you have seen someone else treated unfairly. Did you feel contempt
for the person acting unfairly, or did you engage in a cool rational calculation
of the justice of the situation? Most people who think about these situations do
have at least some sense of an emotional stirring that might prompt them to
engage in ethical actions like donating money to help others, apologizing and
attempting to make amends, or intervening on behalf of those who have been
mistreated. In sum, we can conclude that people who are behaving ethically are
at least partially making decisions based on their emotions and feelings, and
this emotional reaction will often be a good thing.
Sources of Emotions and Moods
Have you ever said “I got up on the wrong side of the bed today”? Have you ever
snapped at a co-worker or family member for no particular reason? If you have,
it probably makes you wonder where emotions and moods come from. Here we
discuss some of the primary influences.
Personality Moods and emotions have a trait component: most people have
built-in tendencies to experience certain moods and emotions more frequently
than others do. People also experience the same emotions with different
intensities. Contrast Texas Tech basketball coach Bobby Knight to Microsoft
CEO Bill Gates. The first is easily moved to anger, while the other is relatively
distant and unemotional. Knight and Gates probably differ in affect intensity ,
or how strongly they experience their emotions. 33 Affectively intense people
experience both positive and negative emotions more deeply: when they’re sad,
they’re really sad, and when they’re happy, they’re really happy.
3 Identify the sources of
emotions and moods.
By studying brain injuries, such as
the one experienced by Phineas
Gage and whose skull is illustrated
here, researchers discovered an
important link between emotions
and rational thinking. They found
that losing the ability to emote led
to loss of the ability to reason. From
this discovery, researchers learned
that our emotions provide us with
valuable information that helps our
thinking process.
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affect intensity Individual differences
in the strength with which individuals
experience their emotions.

104 CHAPTER 4 Emotions and Moods
S A L
SELF-ASSESSMENT LIBRARY
What’s My Affect Intensity?
In the Self-Assessment Library (available on CD or online), take assessment
IV.D.2 (What’s My Affect Intensity?).
Day of the Week and Time of the Day Are people in their best moods on the
weekends? As Exhibit 4-3 shows, people tend to be in their worst moods (highest
negative affect and lowest positive affect) early in the week, and in their best
moods (highest positive affect and lowest negative affect) late in the week. 34
What about time of the day? (See Exhibit 4-4 .) We often think we are either
“morning” or “evening” people. However, most of us actually follow the same
pattern. Regardless of what time we go to bed at night or get up in the morning,
levels of positive affect tend to peak at around the halfway point between waking
and sleeping. Negative affect, however, shows little fluctuation throughout the day.
What does this mean for organizational behavior? Monday morning is prob-
ably not the best time to ask someone for a favor or convey bad news. Our work-
place interactions will probably be more positive from midmorning onward and
also later in the week.
Weather When do you think you would be in a better mood—when it’s
70 degrees and sunny, or on a gloomy, cold, rainy day? Many people believe
their mood is tied to the weather. However, a fairly large and detailed body of
evidence conducted by multiple researchers suggests weather has little effect on
mood. 35 One expert concluded, “Contrary to the prevailing cultural view, these
data indicate that people do not report a better mood on bright and sunny days
(or, conversely, a worse mood on dark and rainy days).” 36 Illusory correlation
explains why people tend to think nice weather improves their mood. It occurs
when people associate two events that in reality have no connection.
Our Moods Are Affected by the Day of the Week
Source: “Our Moods Are Affected by the Day of the Week” from Mood and Temperament, by D. Watson. Reprinted by permission
of Guilford Publications, Inc.
Exhibit 4-3
Sun. Mon. Tues. Wed. Thurs. Fri. Sat.
Day of the Week
M
o
o
d
High
Low
Average
Positive affect Negative affect
Negative moods are highest on Sundays and
Mondays and fall throughout the week
Positive moods are highest
at the end of the week

What Are Emotions and Moods? 105
Stress As you might imagine, stressful daily events at work (a nasty e-mail, an im-
pending deadline, the loss of a big sale, a reprimand from the boss) negatively affect
moods. The effects of stress also build over time. As the authors of one study note,
“a constant diet of even low-level stressful events has the potential to cause workers
to experience gradually increasing levels of strain over time.” 37 Mounting levels of
stress can worsen our moods, and we experience more negative emotions. Consider
the following entry from a worker’s blog: “I’m in a bit of a blah mood today . . .
physically, I feel funky, though, and the weather out combined with the amount of
personal and work I need to get done are getting to me.” Although sometimes we
thrive on stress, most of us, like this blogger, find stress takes a toll on our mood. 38
Social Activities Do you tend to be happiest when out with friends? For most
people, social activities increase positive mood and have little effect on nega-
tive mood. But do people in positive moods seek out social interactions, or do
social interactions cause people to be in good moods? It seems both are true. 39
Does the type of social activity matter? Indeed it does. Research suggests activities
that are physical (skiing or hiking with friends), informal (going to a party), or
epicurean (eating with others) are more strongly associated with increases in
positive mood than events that are formal (attending a meeting) or sedentary
(watching TV with friends). 40
illusory correlation The tendency of
people to associate two events when
in reality there is no connection.
Our Moods Are Affected by the Time of Day
Source: “Our Moods Are Affected by the Day of the Week” from Mood and Temperament, by D. Watson. Reprinted by permission of
Guilford Publications, Inc.
Exhibit 4-4
High
Low
Average
M
o
o
d
9:00 AM Noon 3:00 PM 6:00 PM 9:00 PM Midnight
Time of Day
Positive affect Negative affect
Positive mood peaks during
the middle part of the day
Negative moods show very
little variation over the day

106 CHAPTER 4 Emotions and Moods
Moods of the UnemployedOB Poll
Thriving
34
55
Worried
50
28
Sad
36
17
Stressed
54
35
Angry
25
12
Depressed
27
16
60
50
40
30
20
10
0
Unemployed
Employed
Source: E. Mendes and L. Saad, “For Unemployed, Length, Scale of Job Search Affects Well Being, Life Ratings,” Gallup News (February 25, 2011),
http://www.gallup.com/. Reprinted with permission.
Sleep U.S. adults report sleeping less than adults a generation ago. 41 Does
lack of sleep make people grumpier? Sleep quality does affect mood. Under-
graduates and adult workers who are sleep-deprived report greater feelings of
fatigue, anger, and hostility. 42 One reason is that poor or reduced sleep impairs
decision making and makes it difficult to control emotions. 43 A recent study
suggests poor sleep also impairs job satisfaction because people feel fatigued,
irritable, and less alert. 44
Exercise and social activities are
two of the primary sources of emo-
tions and moods. For most people,
working out and participating in
social activities that are informal
and physical increase positive
moods. Shown here are employees
of Blizzard Entertainment taking a
break from work to play volleyball.
Blizzard, a developer of entertain-
ment software, offers employees
yoga classes, a sand volleyball court,
basketball court, bike track, and fit-
ness center where they can exercise
and socialize. Like many other orga-
nizations, Blizzard believes these
activities result in happier, healthier,
and more productive employees.
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What Are Emotions and Moods? 107
Exercise You often hear people should exercise to improve their mood. Does
“sweat therapy” really work? It appears so. Research consistently shows exercise
enhances peoples’ positive mood. 45 While not terribly strong overall, the effects
are strongest for those who are depressed. So exercise may help put you in a
better mood, but don’t expect miracles.
Age Do young people experience more extreme positive emotions (so-called
youthful exuberance) than older people? If you answered “yes,” you were wrong.
One study of people ages 18 to 94 revealed that negative emotions seem to occur
less as people get older. Periods of highly positive moods lasted longer for older in-
dividuals, and bad moods faded more quickly. 46 The study implies emotional expe-
rience improves with age; as we get older, we experience fewer negative emotions.
Sex Many believe women are more emotional than men. Is there any truth to
this? Evidence does confirm women are more emotionally expressive than men; 47
they experience emotions more intensely, they tend to “hold onto” emotions
longer than men, and they display more frequent expressions of both positive
and negative emotions, except anger. 48 Evidence from a study of participants
from 37 different countries found that men consistently report higher levels of
powerful emotions like anger, whereas women report more powerless emotions
like sadness and fear. Thus, there are some sex differences in the experience
and expression of emotions. 49
T
his statement is generally true.
Consider the following scenario:
Assume you work with three
other people: Jane, Blake, and Morgan.
Jane received several calls from cus-
tomers unhappy with a product made
by her company. Blake broke up with
his fiancé. Morgan has had a recurrence
of depression. Yet at lunch today all
three seemed pretty happy. There were
smiles, laughter, and in general good
humor for all to see. Yet each person, in
his or her own way, is weathering tough
times. If you had to gauge the moods of
Jane, Blake, and Morgan, you might say
they were in relatively good moods. If
you asked each of them, however, they
might attribute their seeming good hu-
mor to impression management, “put-
ting on a good face,” or the effects of
the social environment.
This hypothetical scenario reflects
a phenomenon recent research
supports: we typically underestimate
the negative emotions experienced by
others. In other words, people often
feel worse than we believe they do. To
some extent, the same is true of posi-
tive emotions: We estimate people to
experience more positive emotions
than they do. Why do we think people
are in better moods than they really
are, and what are the implications?
There are two reasons we see oth-
ers as experiencing more positive and
fewer negative emotions than they do:
1. People generally experience more
negative emotions when they are
by themselves than when they
are in the company of others. So
we tend to see others not at their
lowest, but at their highest.
2. Most people are reluctant to di-
vulge negative feelings in social
situations. Thus, when we’re feeling
low, we tend to avoid showing oth-
ers how bad we feel.
The upshot? First, we should appre-
ciate that in social situations like work,
people probably feel less happy than
they appear. Second, we should be
less afraid to disclose negative emo-
tions to friends, close coworkers, and
significant others, given the costs of
“keeping it all in.” Often the strongest
emotional links we form with others
occur when someone reports expe-
riencing something negative that we
too have experienced.
Sources: Based on: A. H. Jordan, B. Monin,
C. S. Dweck, B. J. Lovett, O. P. John, and
J. J. Gross, “Misery Has More Company Than
People Think: Underestimating the Prevalence
of Others’ Negative Emotions,” Personality
and Social Psychology Bulletin 37, no. 1
(2011), pp. 120–135; M. Szalavitz, “Misery
Has More Company Than You Think, Especially
on Facebook,” Time (January 27, 2011), http://
healthland.time.com ; and C. Jarrett, “Other
People May Experience More Misery Than
You Realize,” Research Digest (January 24,
2011), http://bps-research-digest.blogspot
.com .
Myth or Science?
We Are Better Judges of When Others
Are Happy Than When They Are Sad

http://healthland.time.com

http://bps-research-digest.blogspot.com

108 CHAPTER 4 Emotions and Moods
People also tend to attribute men’s and women’s emotions in ways that
might be based on stereotypes of what typical emotional reactions are. One
study showed that experimental participants who read about emotional expres-
sions interpreted women’s reactions as being dispositional (related to person-
ality), whereas men’s reactions were interpreted as being due to the situation
around them. 50 For example, a picture of a sad woman led observers to believe
she was acting consistently with an emotional personality type, whereas a picture
of a sad man was more likely to be attributed to his having a bad day. Another
study showed that participants were faster at detecting angry expressions on
male faces and happy expressions on female faces; neutral faces in men were at-
tributed as more angry and neutral faces in women were interpreted as happy. 51
I
n most customer service jobs in
the United States, there is a strong
social pressure for employees to dis-
play an upbeat demeanor at all times,
demonstrating happy and friendly
emotions in an effort to make custom-
ers feel pleasant and at ease. Experts
on emotional labor have found that
these rules encouraging “service with
a smile” are also found in many other
countries, but that doesn’t mean they
are followed to the same extent every-
where.
One study examined international
differences in emotional displays by
having participants from Israel, France,
Singapore, and the United States
explain how they would behave in a va-
riety of emotionally charged situations
as customer service agents. Their
results showed that although there
was a strongly consistent tendency
for respondents to report they would
try to show happiness and suppress
anger toward customers, there were
differences in the extent to which
people would engage in these forms
of emotional labor. Respondents from
Singapore were especially negatively
disposed toward expressing anger at
customers, while the French found it
more acceptable. U.S. respondents
were especially likely to display happi-
ness toward customers, while French
respondents were most reserved in
their expressions of happiness.
This is not to say there aren’t cross-
cultural similarities in customer service
expectations and customer reactions.
There are no cultures in which smiling
is seen as an expression of hostility or
in which a grimace or frown is seen
as a sign of friendliness. There also
appear to be consistently positive re-
actions to others who display positive
emotions. However, companies that
operate in multiple markets should
expect to see differences in the types
of emotions customer service employ-
ees will display.
Sources: A. Grandey, A Rafaeli, S. Ravid,
J. Wirtz, and D. D. Steiner, “Emotion
Display Rules at Work in the Global
Service Economy: The Special Case of the
Customer,” Journal of Service Management
21, (2010), pp. 388–412; and D. Matsumoto,
“Culture and Emotional Expression,” in
R. S. Wyer, C. Chiu, and Y. Hong (Eds.),
Understanding Culture: Theory, Research,
and Application (New York: Taylor and
Francis, 2009), pp. 271–288.
glOBalization!
Should You Expect “Service with a Smile”
All Around the World?
If you’ve ever had a job in retail sales or waited on tables in a restaurant, you know
the importance of projecting a friendly demeanor and smiling. Even though
there were days when you didn’t feel cheerful, you knew management expected
you to be upbeat when dealing with customers. So you faked it. Every employee
expends physical and mental labor by putting body and mind, respectively, into
the job. But jobs also require emotional labor , an employee’s expression of orga-
nizationally desired emotions during interpersonal transactions at work.
4 Show the impact emotional
labor has on employees.
Emotional Labor

Emotional Labor 109
The concept of emotional labor emerged from studies of service jobs.
Airlines expect their flight attendants to be cheerful; we expect funeral directors
to be sad and doctors emotionally neutral. But emotional labor is relevant to
almost every job. At the least your managers expect you to be courteous, not
hostile, in your interactions with co-workers. The true challenge arises when
employees have to project one emotion while feeling another. 52 This dispar-
ity is emotional dissonance , and it can take a heavy toll. Bottled-up feelings of
frustration, anger, and resentment can eventually lead to emotional exhaustion
and burnout. 53 It’s from the increasing importance of emotional labor as a key
component of effective job performance that we have come to understand the
relevance of emotion within the field of OB.
Emotional labor creates dilemmas for employees. There are people with
whom you have to work that you just plain don’t like. Maybe you consider their
personality abrasive. Maybe you know they’ve said negative things about you be-
hind your back. Regardless, your job requires you to interact with these people
on a regular basis. So you’re forced to feign friendliness.
It can help you, on the job especially, if you separate emotions into felt or dis-
played emotions . 54 Felt emotions are an individual’s actual emotions. In contrast,
displayed emotions are those that the organization requires workers to show and
considers appropriate in a given job. They’re not innate; they’re learned. “The
ritual look of delight on the face of the first runner-up as the new Miss America is
announced is a product of the display rule that losers should mask their sadness
with an expression of joy for the winner.” 55 Similarly, most of us know we’re ex-
pected to act sad at funerals, regardless of whether we consider the person’s death
a loss, and to appear happy at weddings even if we don’t feel like celebrating.
emotional labor A situation in
which an employee expresses
organizationally desired emotions
during interpersonal transactions
at work.
emotional dissonance Inconsistencies
between the emotions people feel
and the emotions they project.
displayed emotions Emotions that
are organizationally required and
considered appropriate in a given job.
In addition to physical and mental
labor, jobs also require emotional
labor. Emerging from studies of ser-
vice jobs, the concept of emotional
labor involves an employee’s expres-
sion of emotions that an organiza-
tion requires during interpersonal
transactions. Employees of this new
Apple store in Scottsdale, Arizona,
greeted shoppers standing in line
and waiting to get into the store
with a warm reception. Employees’
smiles and high fives are expres-
sions of emotional labor that Apple
requires and considers appropriate
for their jobs.
felt emotions An individual’s actual
emotions.
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110 CHAPTER 4 Emotions and Moods
Research suggests that at U.S. workplaces, it is expected that we should
typically display positive emotions like happiness and excitement and suppress
negative emotions like fear, anger, disgust, and contempt. 56 Effective managers
have learned to be serious when giving an employee a negative performance
evaluation and to hide their anger when they’ve been passed over for promo-
tion. A salesperson who hasn’t learned to smile and appear friendly, despite his
or her true feelings at the moment, typically won’t last long in the job. How we
experience an emotion isn’t always the same as how we show it. 57
Displaying fake emotions requires us to suppress real ones. Surface acting
is hiding inner feelings and forgoing emotional expressions in response to dis-
play rules. A worker who smiles at a customer even when he doesn’t feel like it
is surface acting. Deep acting is trying to modify our true inner feelings based
on display rules. A health care provider trying to genuinely feel more empathy
for her patients is deep acting. 58 Surface acting deals with displayed emotions,
and deep acting deals with felt emotions. Research shows that surface acting is
more stressful to employees because it entails denying their true emotions. 59
Displaying emotions we don’t really feel is exhausting, so it is important to give
employees who engage in surface displays a chance to relax and recharge. A
study that looked at how cheerleading instructors spent their breaks from teach-
ing found those who used their breaks to rest and relax were more effective
instructors after their breaks. 60 Instructors who did chores during their breaks
were only about as effective after their break as they were before. Another study
found that in hospital work groups where there were heavy emotional display
demands, burnout was higher than in other hospital work groups. 61
We’ve seen that emotions and moods are an important part of our lives and our
work lives. But how do they influence our job performance and satisfaction? A
model called affective events theory (AET) demonstrates that employees react
emotionally to things that happen to them at work, and this reaction influences
their job performance and satisfaction. 62
Exhibit 4-5 summarizes AET. The theory begins by recognizing that emotions
are a response to an event in the work environment. The work environment
includes everything surrounding the job—the variety of tasks and degree of
autonomy, job demands, and requirements for expressing emotional labor.
This environment creates work events that can be hassles, uplifting events, or
both. Examples of hassles are colleagues who refuse to carry their share of work,
conflicting directions from different managers, and excessive time pressures.
Uplifting events include meeting a goal, getting support from a colleague, and
receiving recognition for an accomplishment. 63
These work events trigger positive or negative emotional reactions, to which
employees’ personalities and moods predispose them to respond with greater
or lesser intensity. People who score low on emotional stability are more likely
to react strongly to negative events. And our emotional response to a given
event can change depending on mood. Finally, emotions influence a number
of performance and satisfaction variables, such as organizational citizenship
behavior, organizational commitment, level of effort, intention to quit, and
workplace deviance.
5 Describe affective events
theory and identify its
applications.
Affective Events Theory

Affective Events Theory 111
Tests of affective events theory suggest the following:
1. An emotional episode is actually a series of emotional experiences,
precipitated by a single event and containing elements of both emotions
and mood cycles.
2. Current emotions influence job satisfaction at any given time, along with
the history of emotions surrounding the event.
3. Because moods and emotions fluctuate over time, their effect on
performance also fluctuates.
4. Emotion-driven behaviors are typically short in duration and of high
variability.
5. Because emotions, even positive ones, tend to be incompatible with
behaviors required to do a job, they typically have a negative influence on
job performance. 64
Consider an example. 65 Say you work as an aeronautical engineer for Boeing.
Because of the downturn in demand for commercial jets, you’ve just learned
the company is considering laying off 10,000 employees, possibly including you.
This event is likely to make you feel negative emotions, especially fear that you
might lose your primary source of income. And because you’re prone to worry
a lot and obsess about problems, this event increases your feelings of insecurity.
The layoff also sets in motion a series of smaller events that create an episode:
you talk with your boss and he assures you your job is safe; you hear rumors your
department is high on the list to be eliminated; and you run into a former col-
league who was laid off 6 months ago and still hasn’t found work. These events,
surface acting Hiding one’s inner
feelings and forgoing emotional
expressions in response to display
rules.
affective events theory (AET) A model
that suggests that workplace events
cause emotional reactions on the part
of employees, which then influence
workplace attitudes and behaviors.
Affective Events Theory
Source: Based on N. M. Ashkanasy and C. S. Daus, “Emotion in the Workplace: The New Challenge for Managers,” Academy of
Management Executive (February 2002), p. 77.
Exhibit 4-5
Job satisfaction
Job performance
Emotional reactions
• Positive
• Negative
Personal dispositions
• Personality
• Mood
• Daily hassles
• Daily uplifts
Work events
• Characteristics of
the job
• Job demands
• Requirements for
emotional labor
Work environment
deep acting Trying to modify one’s
true inner feelings based on display
rules.

112 CHAPTER 4 Emotions and Moods
in turn, create emotional ups and downs. One day, you’re feeling upbeat that
you’ll survive the cuts. The next, you might be depressed and anxious. These
emotional swings take your attention away from your work and lower your job
performance and satisfaction. Finally, your response is magnified because this is
the fourth-largest layoff Boeing has initiated in the past 3 years.
In summary, AET offers two important messages. 66 First, emotions provide
valuable insights into how workplace hassles and uplifting events influence
employee performance and satisfaction. Second, employees and managers
shouldn’t ignore emotions or the events that cause them, even when they
appear minor, because they accumulate.
Diane Marshall is an office manager. Her awareness of her own and others’
emotions is almost nil. She’s moody and unable to generate much enthusi-
asm or interest in her employees. She doesn’t understand why employees get
upset with her. She often overreacts to problems and chooses the most inef-
fectual responses to emotional situations. 67 Diane has low emotional intelli-
gence. Emotional intelligence (EI) is a person’s ability to (1) perceive emotions
in the self and others, (2) understand the meaning of these emotions, and
(3) regulate one’s emotions accordingly in a cascading model, as shown in
Exhibit 4-6 . People who know their own emotions and are good at reading emo-
tional cues—for instance, knowing why they’re angry and how to express them-
selves without violating norms—are most likely to be effective. 68
Several studies suggest EI plays an important role in job performance. One
study that used functional magnetic resonance imaging (fMRI) technology
found executive MBA students who performed best on a strategic decision mak-
ing task were more likely to incorporate emotion centers of the brain into their
choice process. The students also de-emphasized the use of the more cogni-
tive parts of their brains. 69 Another study looked at the successes and failures
of 11 U.S. presidents—from Franklin Roosevelt to Bill Clinton—and evalu-
ated them on six qualities: communication, organization, political skill, vision,
cognitive style, and emotional intelligence. The key quality that differentiated
6 Contrast the evidence for
and against the existence
of emotional intelligence.
Emotional Intelligence
A Cascading Model of Emotional Intelligence Exhibit 4-6
Perceive Emotions in Self
and Others
Understand the Meaning of
Emotions
Regulate Emotions
Conscientiousness
Cognitive
Emotional Stability

Emotional Intelligence 113
the successful (such as Roosevelt, Kennedy, and Reagan) from the unsuccess-
ful (such as Johnson, Carter, and Nixon) was emotional intelligence. 70 One
simulation study also showed that students who were good at identifying and
distinguishing among their own feelings were able to make more profitable
investment decisions. 71
EI has been a controversial concept in OB, with supporters and detractors.
In the following sections, we review the arguments for and against its viability.
The Case for EI
The arguments in favor of EI include its intuitive appeal, the fact that it predicts
criteria that matter, and the idea that it is biologically based.
Intuitive Appeal Almost everyone agrees it is good to possess social intelli-
gence. Intuition suggests people who can detect emotions in others, control
their own emotions, and handle social interactions well have a powerful leg up
in the business world. Partners in a multinational consulting firm who scored
above the median on an EI measure delivered $1.2 million more in business
than did the other partners. 72
EI Predicts Criteria That Matter Evidence suggests a high level of EI means a
person will perform well on the job. One study found EI predicted the perfor-
mance of employees in a cigarette factory in China. 73 Another study found the
emotional intelligence (EI) The ability
to detect and to manage emotional
cues and information.
Diane Hoskins, a top leader at
Gensler, a global architectural firm,
has high emotional intelligence.
She is one of three executive direc-
tors who operate the firm along
with the management committee.
Hoskins is a star performer in a
job that demands interacting with
employees and developing their
careers to ensure that Gensler has
the talent it needs to serve clients.
Hoskins is shown here discussing
a new internship program that
could help Gensler build its global
business.
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114 CHAPTER 4 Emotions and Moods
ability to recognize emotions in others’ facial expressions and to emotionally
“eavesdrop” (pick up subtle signals about peoples’ emotions) predicted peer
ratings of how valuable people were to their organization. 74 Finally, a review
of studies indicated that, overall, EI weakly but consistently correlated with job
performance, even after researchers took cognitive ability, conscientiousness,
and neuroticism into account. 75
EI Is Biologically Based In one study, people with damage to the brain area
that governs emotional processing (part of the prefrontal cortex) scored no
lower on standard measures of intelligence than people without similar dam-
age. But they scored significantly lower on EI tests and were impaired in normal
decision making, as demonstrated by their poor performance in a card game
with monetary rewards. This study suggests EI is neurologically based in a way
that’s unrelated to standard measures of intelligence. 76 There is also evidence
EI is genetically influenced, further supporting the idea that it measures a real
underlying biological factor. 77
The Case Against EI
For all its supporters, EI has just as many critics who say it is vague and impossible
to measure, and they question its validity.
EI Researchers Do Not Agree on Definitions To many researchers, it’s not
clear what EI is because researchers use different definitions of the con-
struct. 78 Some researchers have focused on emotional intelligence via tests
with right and wrong answers, scoring the ability to recognize and control
emotions. This is the ability-based perspective on EI. Others focus on emo-
tional intelligence as a broad variety of constructs that can be measured by
self-reports and are connected primarily by the fact that they are not redun-
dant with cognitive intelligence. Not only are these two definitions different,
but the measures used by each perspective are barely correlated with one
another. 79
EI Can’t Be Measured Many critics have raised questions about measuring EI.
Because EI is a form of intelligence, they argue, there must be right and wrong
answers for it on tests. Some tests do have right and wrong answers, although
the validity of some questions is doubtful. One measure asks you to associate
feelings with colors, as if purple always makes us feel cool and not warm. Other
measures are self-reported, such as “I’m good at ‘reading’ other people,” and
have no right or wrong answers. However, these self-report measures could
reflect a variety of non-ability related constructs like general self-esteem or
self- efficacy. The measures of EI are diverse, and researchers have not sub-
jected them to as much rigorous study as they have measures of personality and
general intelligence. 80
EI Is Nothing but Personality with a Different Label Some critics argue that
because EI is so closely related to intelligence and personality, once you con-
trol for these factors, it has nothing unique to offer. There is some foundation
to this argument. EI appears to be correlated with measures of personality,
especially emotional stability. 81 If this is true, then the evidence for a biologi-
cal component to EI is spurious, and biological markers like brain activity and
heritability are attributable to other well-known and much better researched
psychological constructs. To some extent, researchers have resolved this issue
by noting that EI is a construct partially determined by traits like cognitive

S A L
SELF-ASSESSMENT LIBRARY
OB Applications of Emotions and Moods 115
intelligence, conscientiousness, and neuroticism, as shown in Exhibit 4-6 , so it
makes sense that EI is correlated with these characteristics. 82
Although the field is progressing in its understanding of EI, many questions have
not been answered. Still, EI is wildly popular among consulting firms and in the
popular press. One company’s promotional materials for an EI measure claimed,
“EI accounts for more than 85 percent of star performance in top leaders.” 83 To say
the least, it’s difficult to validate this statement with the research literature.
Emotion Regulation
Have you ever tried to cheer yourself up when you’re feeling down, or calm
yourself when you’re feeling angry? If so, you have engaged in emotion regula-
tion, which is part of the EI literature but has also been studied as an inde-
pendent concept. 84 The central idea behind emotion regulation is to identify
and modify the emotions you feel. Strategies to change your emotions include
thinking about more pleasant things, suppressing negative thoughts, distract-
ing yourself, reappraising the situation, or engaging in relaxation techniques.
As you might suspect based on our discussion up to this point, not everyone
is equally good at regulating their emotions. Individuals who are higher in the
personality trait of neuroticism have more trouble doing so and often find their
moods are beyond their ability to control. Individuals who have lower levels of
self-esteem are also less likely to try to improve their sad moods, perhaps because
they are less likely than others to feel like they deserve to be in a good mood. 85
While it might seem in some ways desirable to regulate your emotions, re-
search suggests there is a downside to trying to change the way you feel. Changing
your emotions takes effort, and this effort can be exhausting. Sometimes attempts
to change an emotion actually make the emotion stronger; for example, trying
to talk yourself out of being afraid can make you focus more on what scares you,
which makes you more afraid. 86 Emotion suppression appears to be especially
difficult to do effectively and can lead to more negative emotions; reappraising
situations is usually more effective in increasing positive emotions and limiting
negative emotions. 87 From another perspective, research suggests that avoiding
negative emotional experiences is less likely to lead to positive moods than seek-
ing out positive emotional experiences. 88 For example, you’re more likely to ex-
perience a positive mood if you have a pleasant conversation with a friend than
you would be if you avoided an unpleasant conversation with a hostile co-worker.
What’s My Emotional Intelligence Score?
In the Self-Assessment Library (available on CD or online), take assessment I.E.1
(What’s My Emotional Intelligence Score?).
7 Identify strategies for
emotion regulation and
their likely effects.
OB Applications of Emotions and Moods
In this section, we assess how an understanding of emotions and moods can
improve our ability to explain and predict the selection process in organiza-
tions, decision making, creativity, motivation, leadership, interpersonal conflict,
negotiation, customer service, job attitudes, and deviant workplace behaviors.
We also look at how managers can influence our moods.

116 CHAPTER 4 Emotions and Moods
Hiring employees with high
emotional intelligence is important
for companies such as Starbucks,
whose baristas have frequent social
interactions with customers. In
keeping with Starbucks mission
“to inspire and nurture the human
spirit,” the company selects baristas
who relate well to customers,
connect with them, and uplift their
lives. At Starbucks, emotional intel-
ligence plays an important role in
job performance, as the company
enjoys a loyal customer base and
a reputation as one of the most
admired companies in America.
Selection
One implication from the evidence on EI to date is that employers should consider
it a factor in hiring employees, especially in jobs that demand a high degree of social
interaction. In fact, more employers are starting to use EI measures to hire people.
A study of U.S. Air Force recruiters showed that top-performing recruiters exhib-
ited high levels of EI. Using these findings, the Air Force revamped its selection
criteria. A follow-up investigation found future hires who had high EI scores were
2.6 times more successful than those who didn’t. At L’Oreal, salespersons selected
on EI scores outsold those hired using the company’s old selection procedure. On
an annual basis, salespeople selected for their emotional competence sold $91,370
more than other salespeople did, for a net revenue increase of $2,558,360. 89
Decision Making
As you will see in Chapter 6 , traditional approaches to the study of decision making
in organizations have emphasized rationality. But OB researchers are increasingly
finding that moods and emotions have important effects on decision making.
Positive moods and emotions seem to help. People in good moods or expe-
riencing positive emotions are more likely than others to use heuristics, or rules
of thumb, 90 to help make good decisions quickly. Positive emotions also enhance
problem-solving skills, so positive people find better solutions to problems. 91
OB researchers continue to debate the role of negative emotions and moods
in decision making. Although one often-cited study suggested depressed people
reach more accurate judgments, 92 more recent evidence hints they make poorer
decisions. Why? Because depressed people are slower at processing information
and tend to weigh all possible options rather than the most likely ones. 93 They
search for the perfect solution, when there rarely is one.
Creativity
People in good moods tend to be more creative than people in bad moods. 94 They
produce more ideas and more options, and others think their ideas are original. 95
It seems people experiencing positive moods or emotions are more flexible and
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OB Applications of Emotions and Moods 117
open in their thinking, which may explain why they’re more creative. 96 Supervisors
should actively try to keep employees happy because doing so creates more good
moods (employees like their leaders to encourage them and provide positive
feedback on a job well done), which in turn leads people to be more creative. 97
Some researchers, however, do not believe a positive mood makes people more
creative. They argue that when people are in positive moods, they may relax (“If I’m
in a good mood, things must be going okay, and I must not need to think of new
ideas”) and not engage in the critical thinking necessary for some forms of creativ-
ity. 98 The answer may lie in thinking of moods somewhat differently. Rather than
looking at positive or negative affect, it’s possible to conceptualize moods as active
feelings like anger, fear, or elation and contrast these with deactivating moods like
sorrow, depression, or serenity. All the activating moods, whether positive or nega-
tive, seem to lead to more creativity, whereas deactivating moods lead to less. 99
Motivation
Several studies have highlighted the importance of moods and emotions on moti-
vation. One study set two groups of people to solving word puzzles. The first group
saw a funny video clip, intended to put the subjects in a good mood first. The
other group was not shown the clip and started working on the puzzles right away.
The results? The positive-mood group reported higher expectations of being able
to solve the puzzles, worked harder at them, and solved more puzzles as a result. 100
The second study found that giving people performance feedback—whether
real or fake—influenced their mood, which then influenced their motivation. 101
So a cycle can exist in which positive moods cause people to be more creative,
which leads to positive feedback from those observing their work. This posi-
tive feedback further reinforces the positive mood, which may make people
perform even better, and so on.
Another study looked at the moods of insurance sales agents in Taiwan. 102
Agents in a good mood were more helpful toward their co-workers and also felt
better about themselves. These factors in turn led to superior performance in
the form of higher sales and better supervisor reports of performance.
Leadership
Effective leaders rely on emotional appeals to help convey their messages. 103 In
fact, the expression of emotions in speeches is often the critical element that
makes us accept or reject a leader’s message. “When leaders feel excited, enthu-
siastic, and active, they may be more likely to energize their subordinates and
convey a sense of efficacy, competence, optimism, and enjoyment.” 104 Politicians,
as a case in point, have learned to show enthusiasm when talking about their
chances of winning an election, even when polls suggest otherwise.
Corporate executives know emotional content is critical if employees are to
buy into their vision of the company’s future and accept change. When higher-
ups offer new visions, especially with vague or distant goals, it is often difficult for
employees to accept the changes they’ll bring. By arousing emotions and link-
ing them to an appealing vision, leaders increase the likelihood that managers
and employees alike will accept change. 105 Leaders who focus on inspirational
goals also generate greater optimism and enthusiasm in employees, leading to
more positive social interactions with co-workers and customers. 106
Negotiation
Negotiation is an emotional process; however, we often say a skilled negotiator
has a “poker face.” The founder of Britain’s Poker Channel, Crispin Nieboer,
stated, “It is a game of bluff and there is fantastic human emotion and tension,

118 CHAPTER 4 Emotions and Moods
seeing who can bluff the longest.” 107 Several studies have shown that a negotia-
tor who feigns anger has an advantage over the opponent. Why? Because when
a negotiator shows anger, the opponent concludes the negotiator has conceded
all she can and so gives in. 108 Anger should be used selectively in negotiation:
angry negotiators who have less information or less power than their oppo-
nents have significantly worse outcomes. 109 It appears that a powerful, better-
informed individual will be less willing to share information or meet an angry
opponent halfway.
Displaying a negative emotion (such as anger) can be effective, but feeling
bad about your performance appears to impair future negotiations. Individuals
who do poorly in a negotiation experience negative emotions, develop negative
perceptions of their counterpart, and are less willing to share information or be
cooperative in future negotiations. 110 Interestingly, then, while moods and emo-
tions have benefits at work, in negotiation—unless we’re putting up a false front
like feigning anger—emotions may impair negotiator performance. A 2005 study
found people who suffered damage to the emotional centers of their brains (the
same part that was injured in Phineas Gage) may be the best negotiators, because
they’re not likely to overcorrect when faced with negative outcomes. 111
Customer Service
A worker’s emotional state influences customer service, which influences levels
of repeat business and of customer satisfaction. 112 Providing high-quality cus-
tomer service makes demands on employees because it often puts them in a
state of emotional dissonance. Over time, this state can lead to job burnout,
declines in job performance, and lower job satisfaction. 113
Employees’ emotions can transfer to the customer. Studies indicate a
matching effect between employee and customer emotions called emotional
contagion —the “catching” of emotions from others. 114 How does it work? The
primary explanation is that when someone experiences positive emotions and
laughs and smiles at you, you tend to respond positively. Emotional contagion
is important because customers who catch the positive moods or emotions
of employees shop longer. But are negative emotions and moods contagious,
The general manager of a profes-
sional sports team is the organi-
zational leader responsible for
developing a winning team. As
general manager of the Los Angeles
Dodgers, Ned Colletti is shown here
delivering an inspirational talk to
employees right before a game
between the Dodgers and the San
Diego Padres. Colletti relies on emo-
tional appeals to employees of all
the individual divisions of the team,
from administrative affairs to public
relations, to work well together in
achieving a victorious season.
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OB Applications of Emotions and Moods 119
too? Absolutely. When an employee feels unfairly treated by a customer, for
example, it’s harder for him to display the positive emotions his organization
expects of him. 115
Job Attitudes
Ever hear the advice “Never take your work home with you,” meaning you
should forget about work once you go home? That’s easier said than done.
Several studies have shown people who had a good day at work tend to be in a
better mood at home that evening, and vice versa. 116 People who have a stressful
day at work also have trouble relaxing after they get off work. 117 One study had
married couples describing their moods when responding to timed cell-phone
surveys through the course of the day. As most married readers might suspect,
if one member of the couple was in a negative mood during the workday, that
mood spilled over to the spouse at night. 118 In other words, if you’ve had a bad
day at work, your spouse is likely to have an unpleasant evening. Even though
people do emotionally take their work home with them, however, by the next
day the effect is usually gone. 119
Deviant Workplace Behaviors
Anyone who has spent much time in an organization realizes people often be-
have in ways that violate established norms and threaten the organization, its
members, or both. As we saw in Chapter 1 , these actions are called workplace
deviant behaviors . 120 Many can be traced to negative emotions.
For instance, envy is an emotion that occurs when you resent someone for
having something you don’t have but strongly desire—such as a better work
assignment, larger office, or higher salary. 121 It can lead to malicious deviant
behaviors. An envious employee could backstab another employee, negatively
distort others’ successes, and positively distort his own accomplishments. 122
Angry people look for other people to blame for their bad mood, interpret
other people’s behavior as hostile, and have trouble considering others’ point
of view. 123 It’s not hard to see how these thought processes, too, can lead directly
to verbal or physical aggression.
Evidence suggests people who feel negative emotions, particularly anger or
hostility, are more likely than others to engage in deviant behavior at work. 124
Once aggression starts, it’s likely that other people will become angry and ag-
gressive, so the stage is set for a serious escalation of negative behavior.
Safety and Injury at Work
Research relating negative affectivity to increased injuries at work suggests em-
ployers might improve health and safety (and reduce costs) by ensuring workers
aren’t engaged in potentially dangerous activities when they’re in a bad mood.
Bad moods can contribute to injury at work in several ways. 125 Individuals in
negative moods tend to be more anxious, which can make them less able to cope
effectively with hazards. A person who is always scared will be more pessimistic
about the effectiveness of safety precautions because she feels she’ll just get hurt
anyway, or she might panic or freeze up when confronted with a threatening
emotional contagion The process by
which peoples’ emotions are caused
by the emotions of others.

120 CHAPTER 4 Emotions and Moods
E
nglish may be a robust language,
but sometimes a word from
another language expresses
something that English misses. Such
is the case with a particular and inter-
esting emotional sentiment known by
a German name.
“Taking delight in the misery of oth-
ers,” or s chadenfreude, has recently
been studied by psychologists whose
findings have implications for work.
Neuropsychological research shows
that when we experience schaden-
freude, it is the pleasure centers of our
brains that light up, similar to what hap-
pens when we enjoy good food or win
a contest. It may explain why we take
a special interest in reading about the
misfortunes of Bernie Madoff, Lindsay
Lohan, Charlie Sheen, and others.
As you might experience, we are
more likely to experience schaden-
freude when the misfortune happens
to someone we envy or dislike, or, as a
recent study showed, to someone we
see as a rival, such as a co-worker with
whom we have a competitive relation-
ship. This effect persisted even when
researchers controlled for how much
the person liked the other.
What are the ethical and work
implications of schadenfreude?
1. Don’t judge yourself too harshly for
experiencing schadenfreude. As
one review noted, “it seems almost
inherent to social being.” If we ex-
pect ourselves to never experience
schadenfreude toward a disliked co-
worker, it’s a standard we’re bound
to fail to meet.
2. At the same time, try to recog-
nize that while social comparisons
are natural, they’re not particularly
healthy. As eminent psychologist
Susan Fiske noted, “Comparison
emotions can corrupt the comparer.”
Perhaps we can’t avoid some com-
parisons to our coworkers or friends,
but we can control how much we do
it. Schadenfreude can keep us from
empathizing not only with one indi-
vidual, but with those experiencing
misfortune more generally.
Sources: W. van Dijk, J. W. Ouwerkerk,
Y. M. Wesseling , and G. M. van
Koningsbruggen, “Towards Understanding
Pleasure at the Misfortunes of Others:
The Impact of Self-Evaluation Threat on
Schadenfreude,” Cognition and Emotion
25, no. 2 (2011), pp. 360–368; R. H. Smith,
C. A. Powell, D. J. Combs, and D. R. Schurtz,
“Exploring the When and Why of
Schadenfreude,” Social and Personality
Psychology Compass 3, no. 4 (2009),
pp. 530–546; S. T. Fiske, “Envy Up, Scorn
Down: How Comparison Divides Us,”
American Psychologist 65, no. 8 (2010),
pp. 698–706; and D. Rakoff, “When Bad
Things Happen To Do-Good People,” The
New York Times (May 1, 2011), p. WK12.
An Ethical Choice
Schadenfreude
situation. Negative moods also make people more distractable, and distractions
can obviously lead to careless behaviors.
How Managers Can Influence Moods
You can usually improve a friend’s mood by sharing a funny video clip, giving
the person a small bag of candy, or even offering a pleasant beverage. 126 But
what can companies do to improve employees’ moods? Managers can use hu-
mor and give their employees small tokens of appreciation for work well done.
Also, when leaders themselves are in good moods, group members are more
positive, and as a result they cooperate more. 127
Finally, selecting positive team members can have a contagion effect because
positive moods transmit from team member to team member. One study of
professional cricket teams found players’ happy moods affected the moods of
their team members and positively influenced their performance. 128 It makes
sense, then, for managers to select team members predisposed to experience
positive moods.
8 Apply concepts about
emotions and moods to
specific OB issues.
MyManagementLab
Now that you have finished this chapter, go back to www.mymanagementlab.com to continue
practicing and applying the concepts you’ve learned.

www.mymanagementlab.com

Questions for Review 121
Summary and Implications for Managers
Emotions and moods are similar in that both are affective in nature. But they’re
also different—moods are more general and less contextual than emotions.
And events do matter. The time of day and day of the week, stressful events,
social activities, and sleep patterns are some of the factors that influence emo-
tions and moods. Emotions and moods have proven relevant for virtually every
OB topic we study, and they have implications for managerial practice.
● Increasingly, organizations are selecting employees they believe have high
levels of emotional intelligence. Research has helped to refine theory re-
lated to emotional intelligence in recent years, which should lead to supe-
rior tools for assessing ability-based EI.
● Emotions and positive moods appear to facilitate effective decision mak-
ing and creativity.
● Recent research suggests mood is linked to motivation, especially through
feedback.
● Leaders rely on emotions to increase their effectiveness.
● The display of emotions is important to social behavior like negotiation
and customer service.
● The experience of emotions is closely linked to job attitudes and behav-
iors that follow from attitudes, such as deviant workplace behavior.
● Our final managerial implication is a question: can managers control col-
leagues’ and employees’ emotions and moods? Certainly there are limits,
practical and ethical. Emotions and moods are a natural part of an individu-
al’s makeup. Where managers err is in ignoring co-workers’ and employees’
emotions and assessing others’ behavior as if it were completely rational. As
one consultant aptly put it, “You can’t divorce emotions from the workplace
because you can’t divorce emotions from people.” 129 Managers who under-
stand the role of emotions and moods will significantly improve their ability
to explain and predict their co-workers’ and employees’ behavior.
1 What is the difference between emotions and moods?
What are the basic emotions and moods?
2 Are emotions rational? What functions do they serve?
3 What are the sources of emotions and moods?
4 What impact does emotional labor have on employees?
5 What is affective events theory? What are its
applications?
6 What is the evidence for and against the existence
of emotional intelligence?
7 What are some strategies for emotion regulation and
their likely effects?
8 How do you apply concepts about emotions and moods
to specific OB issues?
QUESTIONS FOR REVIEW

122 CHAPTER 4 Emotions and Moods
Sometimes Blowing Your Top Is a Good Thing
POINT COUNTERPOINT
Y
es, anger is a common emotion. But it’s also a toxic one. The
experience of anger and its close correlate, hostility, is linked
to many counterproductive behaviors in organizations. That
is why many organizations have developed anger management
programs—to blunt the harmful effects of anger in the workplace.
The Bureau of Labor Statistics estimates that 16 percent of
fatal workplace injuries resulted from workplace violence. Do
we think the individuals who committed these acts were feeling
joyful and contented?
To reduce anger in the workplace, many companies develop
policies that govern conduct such as yelling, shouting profani-
ties, and making hostile gestures. Others institute anger man-
agement programs. For example, one organization conducted
mandatory in-house workshops that showed individuals how to
deal with conflicts in the workplace before they boil over. The
director who instituted the training said it “gave people specific
tools for opening a dialogue to work things out.” MTS Systems,
an Eden Prairie, Minnesota, engineering firm, engages an out-
side consulting firm to conduct anger management programs for
its organization. Typically, MTS holds an eight-hour seminar that
discusses sources of anger, conflict resolution techniques, and
organizational policies. This is followed by one-on-one sessions
with individual employees that focus on cognitive behavioral
techniques to manage their anger. The outside trainer charges
$7,000–$10,000 for the seminar and one-on-one sessions. “You
want people to get better at communicating with each other,”
says MTS manager Karen Borre.
In the end, everyone wins when organizations seek to
diminish both the experience and, yes, the expression of anger
at work. The work environment is less threatening and stressful
to employees and customers. Employees are likely to feel safer.
And the angry employee is often helped as well.
A
nger is discussed throughout this chapter for a rea-
son: it’s an important emotion. However, what about
our responses to feeling anger? Work cultures teach
us to avoid showing any anger at all, lest we be seen as
poor service providers or, worse, unprofessional or even
deviant or violent. While, of course, there are times when
the expression of anger is harmful or unprofessional, we’ve
taken this view so far that we now teach people to sup-
press perfectly normal emotions. It is inappropriate to ask
people to behave in abnormal ways, and there is even more
evidence about the organizational and personal costs of
such suppression.
Emerging research shows that suppressing anger takes
a terrible toll on individuals. One Stanford University study
showed, for example, that when individuals were asked to
wear a poker face during the showing of the atomic bombings
of Japan during World War II, they were much more stressful
conversation partners once the video was over. Other research
shows that college students who suppress emotions like an-
ger have more trouble making friends and are more likely to be
depressed, and that employees who suppress anger feel more
stressed by work.
There is a better way. One recent study showed that even
when employees displayed anger deemed inappropriate by
co-workers, if co-workers responded supportively to the anger
(for example, by listening to the angry employee), favorable re-
sponses such as constructive work changes were the result.
Yes, managers must work to maintain a positive, respectful,
and nonviolent culture. However, asking employees to suppress
their anger not only is an ineffective and costly strategy, it ulti-
mately may backfire if appropriate ways to express and release
anger are blocked.
Sources: B. Carey, “The Benefits of Blowing Your Top,” The New York Times (July 6, 2010), p. D1; R. Y. Cheung and I. J. Park,
“Anger Suppression, Interdependent Self-Construal, and Depression Among Asian American and European American College
Students,” Cultural Diversity and Ethnic Minority Psychology 16, no. 4 (2010), pp. 517–525; D. Geddes and L. T. Stickney, “The
Trouble with Sanctions: Organizational Responses to Deviant Anger Displays at Work,” Human Relations 64, no. 2 (2011),
pp. 201–230; and J. Fairley, “Taking Control of Anger Management,” Workforce Management (October 2010), p. 10.

Ethical Dilemma 123
ETHICAL DILEMMA Happiness Coaches for Employees
We know there is considerable spillover from personal un-
happiness to negative emotions at work. Moreover, those
who experience negative emotions in life and at work are
more likely to engage in counterproductive behaviors with
customers, clients, or fellow employees.
Increasingly, organizations such as American Express,
UBS, and KPMG are turning to happiness coaches to ad-
dress this spillover from personal unhappiness to work
emotions and behaviors.
Srikumar Rao is a former college professor who has
the nickname, “the happiness guru.” Rao teaches peo-
ple to analyze negative emotions to prevent them from
becoming overwhelming. If your job is restructured, for
example, Rao suggests avoiding negative thoughts and
feelings about it. Instead, he advises, tell yourself it could
turn out well in the long run, and there is no way to know
at present.
Beyond reframing the emotional impact of work situa-
tions, some happiness coaches attack the negative emotional
spillover from life to work (and from work to life). A work-
ing mother found that a happiness talk by Shawn Actor
helped her stop focusing on her stressed-out life and in-
stead look for chances to smile, laugh, and be grateful.
In some cases, the claims made by happiness coaches
seem a bit trite. Jim Smith, who labels himself “The
Executive Happiness Coach,” asks: “What if I told you
that there are secrets nobody told you as a kid—or as
an adult, for that matter—that can unlock for you all
sorts of positive emotional experiences? What if the only
thing that gets in the way of you feeling more happiness
is—YOU?! What if you can change your experience of
the world by shifting a few simple things in your life, and
then practicing them until they become second nature?”
Then again, if employees leave their experiences with a
happiness coach feeling happier about their jobs and their
lives, is that not better for everyone? Says one individual,
Ivelisse Rivera, who felt she benefitted from a happiness
coach, “If I assume a negative attitude and complain all
the time, whoever is working with me is going to feel the
same way.”
Questions
1. Do you think happiness coaches are effective? How
might you assess their effectiveness?
2. Would you welcome happiness training in your
workplace? Why or why not?
3. Some argue that happiness coaches are a way for organi-
zations to avoid solving real work problems—a diversion,
if you will. How might we make this determination?
4. Under what circumstances—if any—is it ethically
appropriate for a supervisor to suggest a happiness
coach for a subordinate?
Sources: S. Shellenbarger, “Thinking Happy Thoughts at Work,” The Wall Street Journal (January 27, 2010),
p. D2; S. Sharma and D. Chatterjee, “Cos Are Keenly Listening to ‘Happiness Coach’,” Economic Times
(July 16, 2010), http://articles.economictimes.indiatimes.com ; and J. Smith, The Executive Happiness
Coach , www.lifewithhappiness.com / (Downloaded May 3, 2011).
EXPERIENTIAL EXERCISE Who Can Catch a Liar?
We mentioned earlier in the chapter that emotion re-
searchers are highly interested in facial expressions as
a window into individuals’ emotional worlds. Research
has also studied whether people can tell someone is lying
based on signs of guilt or nervousness in their facial
expressions. Let’s see who is good at catching liars.
Split up into teams and follow these instructions.
1. Randomly choose someone to be the team organizer.
Have this person write down on a piece of paper “T”
for truth and “L” for lie. If there are, say, six people
in the group (other than the organizer), then three
people will get a slip with a “T” and three a slip with
an “L.” It’s important that all team members keep
what’s on their paper a secret.
2. Each team member who holds a T slip needs to come
up with a true statement, and each team member who
holds an L slip needs to come up with a false state-
ment. Try not to make the statement so outrageous
that no one would believe it (for example, “I have
flown to the moon”).
3. The organizer will have each member make his or
her statement. Group members should then exam-
ine the person making the statement closely to try
to determine whether he or she is telling the truth
or lying. Once each person has made his or her
statement, the organizer will ask for a vote and record
the tallies.
4. Each person should now indicate whether the state-
ment was the truth or a lie.
5. How good was your group at catching the liars? Were
some people good liars? What did you look for to
determine whether someone was lying?

www.lifewithhappiness.com/

http://articles.economictimes.indiatimes.com

124 CHAPTER 4 Emotions and Moods
CASE INCIDENT 1 Is It Okay to Cry at Work?
As this chapter has shown, emotions are an inevitable part
of people’s behavior at work. At the same time, it’s not en-
tirely clear that we’ve reached a point where people feel
comfortable expressing all emotions at work. The reason
might be that business culture and etiquette remain poorly
suited to handling overt emotional displays. The question
is, can organizations become more intelligent about emo-
tional management? Is it ever appropriate to yell, laugh,
or cry at work?
Some people are skeptical about the virtues of more
emotional displays at the workplace. As the chapter notes,
emotions are automatic physiological responses to the en-
vironment, and as such, they can be difficult to control
appropriately. One 22-year-old customer service represen-
tative named Laura who was the subject of a case study
noted that fear and anger were routinely used as methods
to control employees, and employees deeply resented this
use of emotions to manipulate them. In another case, the
chairman of a major television network made a practice of
screaming at employees whenever anything went wrong,
leading to badly hurt feelings and a lack of loyalty to the
organization. Like Laura, workers at this organization were
hesitant to show their true reactions to these emotional
outbursts for fear of being branded as “weak” or “ineffec-
tual.” It might seem like these individuals worked in heav-
ily emotional workplaces, but in fact, only a narrow range
of emotions was deemed acceptable. Anger appears to be
more acceptable than sadness in many organizations, and
anger can have serious maladaptive consequences.
Others believe organizations that recognize and work
with emotions effectively are more creative, satisfying, and
productive. For example, Laura noted that if she could
express her hurt feelings without fear, she would be much
more satisfied with her work. In other words, the problem
with Laura’s organization is not that emotions are displayed,
but that emotional displays are handled poorly. Others note
that use of emotional knowledge, like being able to read and
understand the reactions of others, is crucial for workers
ranging from salespeople and customer service agents all the
way to managers and executives. One survey even found that
88 percent of workers feel being sensitive to the emotions of
others is an asset. Management consultant Erika Anderson
notes, “Crying at work is transformative and can open the
door to change.” The question then is, can organizations
take specific steps to become better at allowing emotional
displays without opening a Pandora’s Box of outbursts?
Questions
1. What factors do you think make some organizations
ineffective at managing emotions?
2. Do you think the strategic use and display of
emotions serve to protect employees, or does
covering your true emotions at work lead to more
problems than it solves?
3. Have you ever worked where emotions were used as
part of a management style? Describe the advantages
and disadvantages of this approach in your
experience.
4. Research shows that acts of co-workers (37 percent)
and management (22 percent) cause more negative
emotions for employees than do acts of customers
(7 percent). 130 What can Laura’s company do to
change its emotional climate?
Sources: A. Kreamer, “Go Ahead—Cry at Work,” Time (April 4, 2010), www.time.com ; J. S. Lerner and
K. Shonk, “How Anger Poisons Decision Making,” Harvard Business Review (September 2010), p. 26; and
J. Perrone and M. H. Vickers, “Emotions as Strategic Game in a Hostile Workplace: An Exemplar Case,”
Employee Responsibilities and Rights Journal 16, no. 3 (2004), pp. 167–178.
CASE INCIDENT 2 Can You Read Emotions from Faces?
We mentioned previously that some researchers—the psy-
chologist Paul Ekman is the best known—have studied
whether facial expressions reveal true emotions. These
researchers have distinguished real smiles ( so-called
Duchenne smiles, named after French physician Guillaume
Duchenne) from “fake” smiles. Duchenne found genuine
smiles raised not only the corners of the mouth (easily
faked) but also cheek and eye muscles (much more diffi-
cult to fake). So, one way to determine whether someone
is genuinely happy or amused is to look at the muscles
around the upper cheeks and eyes—if the person’s eyes are
smiling or twinkling, the smile is genuine. Ekman and his
associates have developed similar methods to detect other
emotions, such as anger, disgust, and distress. According to
Ekman, the key to identifying real emotions is to focus on
micro-expressions, or those facial muscles we cannot easily
manipulate.
Dan Hill has used these techniques to study the fa-
cial expressions of CEOs and found they vary dramati-
cally not only in their Duchenne smiles but also in the

www.time.com

Endnotes 125
Sources: Based on P. Ekman, Telling Lies: Clues to Deceit in the Marketplace, Politics, and Marriage (New York:
W. W. Norton & Co., 2009); D. Jones, “It’s Written All Over Their Faces,” USA Today (February 25, 2008),
pp. 1B–2B; and N. O. Rule and N. Ambady, “The Face of Success,” Psychological Science 19, no. 2 (2008),
pp. 109–111.
degree to which they display positive versus negative fa-
cial expressions. The accompanying table shows Hill’s
analysis of the facial expressions of some prominent male
executives:
Jeff Bezos, Amazon 51% positive
Warren Buffet, Berkshire Hathaway 69% positive
Michael Dell, Dell Computers 47% positive
Larry Ellison, Oracle 0% positive
Bill Gates, Microsoft 73% positive
Steve Jobs, Apple 48% positive
Phil Knight, Nike 67% positive
Donald Trump,
The Trump Organization
16% positive
It’s interesting to note that these individuals, all of whom are
successful in various ways, have such different levels of posi-
tive facial expressions. It also raises the question: is a smile
from Larry Ellison worth more than a smile from Bill Gates?
Questions
1. Most research suggests we are not very good at detect-
ing fake emotions, and we think we’re much better at
it than we are. Do you believe training would improve
your ability to detect emotional displays in others?
2. Do you think the information in this case could help
you tell whether someone’s smile is genuine?
3. Is your own impression of the facial expressions of
the eight business leaders consistent with what the
researcher found? If not, why do you think your views
might be at odds with his?
4. One research study found people’s ratings of the
positive affect displayed in CEO’s faces had very little
correlation to their company’s profits. Does that sug-
gest to you that Hill’s analysis is immaterial?
5. Assuming you could become better at detecting the
real emotions in facial expressions, do you think it
would help your career? Why or why not?
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2. See, for example, L. L. Putnam and D. K. Mumby,
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pp. 81–96.
15. Ibid.

126 CHAPTER 4 Emotions and Moods
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Endnotes 127
49. A. H. Fischer, P. M. Rodriguez Mosquera, A. E. M. van Vianen,
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of Emotions in Organizational Settings,” Management
Communication Quarterly (August 2002), pp. 66–80; and
J. M. Diefendorff and E. M. Richard, “Antecedents and
Consequences of Emotional Display Rule Perceptions,”
Journal of Applied Psychology (April 2003), pp. 284–294.
55. B. M. DePaulo, “Nonverbal Behavior and Self-Presentation,”
Psychological Bulletin (March 1992), pp. 203–243.
56. J. M. Diefendorff and G. J. Greguras, “Contextualizing
Emotional Display Rules: Examining the Roles of Targets and
Discrete Emotions in Shaping Display Rule Perceptions,”
Journal of Management 35 (2009), pp. 880–898.
57. Solomon, “Back to Basics.”
58. C. M. Brotheridge and R. T. Lee, “Development and Validation
of the Emotional Labour Scale,” Journal of Occupational &
Organizational Psychology 76 (2003), pp. 365–379.
59. A. A. Grandey, “When ‘The Show Must Go On’: Surface
Acting and Deep Acting as Determinants of Emotional
Exhaustion and Peer-Rated Service Delivery,” Academy
of Management Journal (February 2003), pp. 86–96; and
A. A. Grandey, D. N. Dickter, and H. Sin, “The Customer
Is Not Always Right: Customer Aggression and Emotion
Regulation of Service Employees,” Journal of Organizational
Behavior 25 (2004), pp. 397–418.
60. J. P. Trougakos, D. J. Beal, S. G. Green, and H. M. Weiss,
“Making the Break Count: An Episodic Examination of
Recovery Activities, Emotional Experiences, and Positive
Affective Displays,” Academy of Management Journal 51 (2008),
pp. 131–146.
61. J. M. Diefendorff, R. J. Erickson, A. A. Grandey, and
J. J. Dahling, “Emotional Display Rules as Work Unit
Norms: A Multilevel Analysis of Emotional Labor among
Nurses,” Journal of Occupational Health Psychology 16 (2011),
pp. 170–186.
62. H. M. Weiss and R. Cropanzano, “An Affective Events
Approach to Job Satisfaction,” Research in Organizational
Behavior 18 (1996), pp. 1–74.
63. J. Basch and C. D. Fisher, “Affective Events–Emotions Matrix:
A Classification of Work Events and Associated Emotions,”
in N. M. Ashkanasy, C. E. J. Hartel, and W. J. Zerbe (eds.),
Emotions in the Workplace (Westport, CT: Quorum Books,
2000), pp. 36–48.
64. See, for example, H. M. Weiss and R. Cropanzano, “Affective
Events Theory”; and C. D. Fisher, “Antecedents and
Consequences of Real-Time Affective Reactions at Work,”
Motivation and Emotion (March 2002), pp. 3–30.
65. Based on Weiss and Cropanzano, “Affective Events Theory,”
p. 42.
66. N. M. Ashkanasy, C. E. J. Hartel, and C. S. Daus, “Diversity
and Emotion: The New Frontiers in Organizational Behavior
Research,” Journal of Management 28, no. 3 (2002), p. 324.
67. Based on D. R. Caruso, J. D. Mayer, and P. Salovey, “Emotional
Intelligence and Emotional Leadership,” in R. E. Riggio,
S. E. Murphy, and F. J. Pirozzolo (eds.), Multiple Intelligences
and Leadership (Mahwah, NJ: Lawrence Erlbaum, 2002), p. 70.
68. This section is based on Daniel Goleman, Emotional
Intelligence (New York: Bantam, 1995); P. Salovey and
D. Grewal, “The Science of Emotional Intelligence,”
Current Directions in Psychological Science 14, no. 6 (2005),
pp. 281–285; M. Davies, L. Stankov, and R. D. Roberts,
“Emotional Intelligence: In Search of an Elusive Construct,”
Journal of Personality and Social Psychology (October 1998),
pp. 989–1015; D. Geddes and R. R. Callister, “Crossing the
Line(s): A Dual Threshold Model of Anger in Organizations,”
Academy of Management Review 32, no. 3 (2007), pp. 721–746.
69. R. Gilkey, R. Caceda, and C. Kilts, “When Emotional
Reasoning Trumps IQ,” Harvard Business Review (September
2010), p. 27.
70. F. I. Greenstein, The Presidential Difference: Leadership Style from
FDR to Clinton (Princeton, NJ: Princeton University Press,
2001).
71. M. Seo and L. F. Barrett, “Being Emotional During Decision
Making—Good or Bad? An Empirical Investigation,”
Academy of Management Journal 50, no. 4 (2007), pp. 923–940.
72. C. Cherniss, “The Business Case for Emotional Intelligence,”
Consortium for Research on Emotional Intelligence in Organizations ,
1999, www.eiconsortium.org/reports/business_case_for_
ei.html .
73. K. S. Law, C. Wong, and L. J. Song, “The Construct and
Criterion Validity of Emotional Intelligence and Its Potential
Utility for Management Studies,” Journal of Applied Psychology
89, no. 3 (2004), pp. 483–496.
74. H. A. Elfenbein and N. Ambady, “Predicting Workplace
Outcomes from the Ability to Eavesdrop on Feelings,”
Journal of Applied Psychology 87, no. 5 (October 2002),
pp. 963–971.
75. D. L. Joseph and D. A. Newman, “Emotional Intelligence:
An Integrative Meta-Analysis and Cascading Model,” Journal
of Applied Psychology 95 (2010), pp. 54–78.
76. R. Bar-On, D. Tranel, N. L. Denburg, and A. Bechara,
“Exploring the Neurological Substrate of Emotional and Social
Intelligence,” Brain 126, no. 8 (August 2003), pp. 1790–1800.

www.eiconsortium.org/reports/business_case_for_ei.html

128 CHAPTER 4 Emotions and Moods
77. P. A. Vernon, K. V. Petrides, D. Bratko, and J. A. Schermer, “A
Behavioral Genetic Study of Trait Emotional Intelligence,”
Emotion 8, no. 5 (2008), pp. 635–642.
78. E. A. Locke, “Why Emotional Intelligence Is an Invalid
Concept,” Journal of Organizational Behavior 26, no. 4 (June
2005), pp. 425–431.
79. J. D. Mayer, R. D. Roberts, and S. G. Barsade, “Human
Abilities: Emotional Intelligence,” Annual Review of Psychology
59 (2008), pp. 507–536; H. A. Elfenbein, “Emotion in
Organizations: A Review and Theoretical Integration,”
Academy of Management Annals 1 (2008), pp. 315–386; and
D. L. Joseph and D. A. Newman, “Emotional Intelligence:
An Integrative Meta-Analysis and Cascading Model,” Journal
of Applied Psychology 95 (2010), pp. 54–78.
80. J. M. Conte, “A Review and Critique of Emotional
Intelligence Measures,” Journal of Organizational Behavior 26,
no. 4 (June 2005), pp. 433–440; and M. Davies, L. Stankov,
and R. D. Roberts, “Emotional Intelligence,” pp. 989–1015.
81. T. Decker, “Is Emotional Intelligence a Viable Concept?” Academy
of Management Review 28, no. 2 (April 2003), pp. 433–440; and
Davies, Stankov, and Roberts, “Emotional Intelligence.”
82. D. L. Joseph and D. A. Newman, “Emotional Intelligence:
An Integrative Meta-Analysis and Cascading Model,” Journal
of Applied Psychology 95 (2010), pp. 54–78.
83. F. J. Landy, “Some Historical and Scientific Issues Related
to Research on Emotional Intelligence,” Journal of
Organizational Behavior 26, no. 4 (June 2005), pp. 411–424.
84. S. L. Koole, “The Psychology of Emotion Regulation:
An Integrative Review,” Cognition and Emotion 23 (2009),
pp. 4–41; H. A. Wadlinger and D. M. Isaacowitz, “Fixing Our
Focus: Training Attention to Regulate Emotion,” Personality
and Social Psychology Review 15 (2011), pp. 75–102.
85. J. V. Wood, S. A. Heimpel, L. A. Manwell, and
E. J. Whittington, “This Mood Is Familiar and I Don’t Deserve
to Feel Better Anyway: Mechanisms Underlying Self-Esteem
Differences in Motivation to Repair Sad Moods,” Journal of
Personality and Social Psychology 96 (2009), pp. 363–380.
86. S. L. Koole, “The Psychology of Emotion Regulation: An
Integrative Review,” Cognition and Emotion 23 (2009), pp. 4–41.
87. S. Srivastava, M. Tamir, K. M. McGonigal, O. P. John, and
J. J. Gross, “The Social Costs of Emotional Suppression:
A Prospective Study of the Transition to College,”
Journal of Personality and Social Psychology 96 (2009),
pp. 883–897; Y. Liu, L. M. Prati, P. L. Perrewé, and
R. A. Brymer, “Individual Differences in Emotion
Regulation, Emotional Experiences at Work, and Work-
Related Outcomes: A Two-Study Investigation,” Journal
of Applied Social Psychology 40 (2010), pp. 1515–1538; and
H. A. Wadlinger and D. M. Isaacowitz, “Fixing our Focus:
Training Attention to Regulate Emotion,” Personality and
Social Psychology Review 15 (2011), pp. 75–102.
88. L. K. Barber, P. G. Bagsby, and D. C. Munz, “Affect Regulation
Strategies for Promoting (or Preventing) Flourishing
Emotional Health,” Personality and Individual Differences 49
(2010), pp. 663–666.
89. L. M. J. Spencer, D. C. McClelland, and S. Kelner, Competency
Assessment Methods: History and State of the Art (Boston: Hay/
McBer, 1997).
90. J. Park and M. R. Banaji, “Mood and Heuristics: The
Influence of Happy and Sad States on Sensitivity and Bias in
Stereotyping,” Journal of Personality and Social Psychology
78, no. 6 (2000), pp. 1005–1023.
91. See A. M. Isen, “Positive Affect and Decision Making,” in
M. Lewis and J. M. Haviland-Jones (eds.), Handbook of
Emotions, 2nd ed. (New York: Guilford, 2000), pp. 261–277.
92. L. B. Alloy and L. Y. Abramson, “Judgment of Contingency
in Depressed and Nondepressed Students: Sadder but
Wiser?” Journal of Experimental Psychology: General 108
(1979), pp. 441–485.
93. N. Ambady and H. M. Gray, “On Being Sad and Mistaken:
Mood Effects on the Accuracy of Thin-Slice Judgments,”
Journal of Personality and Social Psychology 83, no. 4 (2002),
pp. 947–961.
94. S. Lyubomirsky, L. King, and E. Diener, “The Benefits of
Frequent Positive Affect: Does Happiness Lead to Success?”
Psychological Bulletin 131, no. 6 (2005), pp. 803–855; and
M. Baas, C. K. W. De Dreu, and B. A. Nijstad, “A Meta-
Analysis of 25 Years of Mood-Creativity Research: Hedonic
Tone, Activation, or Regulatory Focus,” Psychological Bulletin
134 (2008), pp. 779–806.
95. M. J. Grawitch, D. C. Munz, and E. K. Elliott, “Promoting
Creativity in Temporary Problem-Solving Groups: The
Effects of Positive Mood and Autonomy in Problem
Definition on Idea-Generating Per formance,” Group
Dynamics 7, no. 3 (September 2003), pp. 200–213.
96. S. Lyubomirsky, L. King, and E. Diener, “The Benefits of
Frequent Positive Affect: Does Happiness Lead to Success?”
Psychological Bulletin 131, no. 6 (2005), pp. 803–855.
97. N. Madjar, G. R. Oldham, and M. G. Pratt, “There’s No
Place Like Home? The Contributions of Work and Nonwork
Creativity Support to Employees’ Creative Performance,”
Academy of Management Journal 45, no. 4 (2002), pp. 757–767.
98. J. M. George and J. Zhou, “Understanding When Bad
Moods Foster Creativity and Good Ones Don’t: The Role of
Context and Clarity of Feelings,” Journal of Applied Psychology
87, no. 4 (August 2002), pp. 687–697; and J. P. Forgas and
J. M. George, “Affective Influences on Judgments and
Behavior in Organizations: An Information Processing
Perspective,” Organizational Behavior and Human Decision
Processes 86, no. 1 (2001), pp. 3–34.
99. C. K. W. De Dreu, M. Baas, and B. A. Nijstad, “Hedonic
Tone and Activation Level in the Mood-Creativity Link:
Toward a Dual Pathway to Creativity Model,” Journal of
Personality and Social Psychology 94, no. 5 (2008), pp. 739–756;
J. M. George and J. Zhou, “Dual Tuning in a Supportive
Context: Joint Contributions of Positive Mood, Negative
Mood, and Supervisory Behaviors to Employee Creativity,”
Academy of Management Journal 50, no. 3 (2007), pp. 605–622.
100. A. Erez and A. M. Isen, “The Influence of Positive Affect
on the Components of Expectancy Motivation,” Journal of
Applied Psychology 87, no. 6 (2002), pp. 1055–1067.
101. R. Ilies and T. A. Judge, “Goal Regulation Across Time: The
Effect of Feedback and Affect,” Journal of Applied Psychology
90, no. 3 (May 2005), pp. 453–467.
102. W. Tsai, C. Chen, and H. Liu, “Test of a Model Linking
Employee Positive Moods and Task Performance,” Journal
of Applied Psychology 92, no. 6 (2007), pp. 1570–1583.
103. K. M. Lewis, “When Leaders Display Emotion: How
Followers Respond to Negative Emotional Expression of
Male and Female Leaders,” Journal of Organizational Behavior,

Endnotes 129
March 2000, pp. 221–234; and J. M. George, “Emotions and
Leadership: The Role of Emotional Intelligence,” Human
Relations (August 2000), pp. 1027–1055.
104. J. M. George, “Trait and State Affect,” In K. Murphy (ed.),
Individual Differences and Behavior in Organizations
(San Francisco: Jossey Bass, 1996), pp. 145–171.
105. Ashforth and Humphrey, “Emotion in the Workplace,”
p. 116.
106. J. E. Bono, H. J. Foldes, G. Vinson, and J. P. Muros,
“Workplace Emotions: The Role of Supervision and
Leadership,” Journal of Applied Psychology 92, no. 5 (2007),
pp. 1357–1367.
107. N. Reynolds, “Whiz-Kids Gamble on TV Channel for
Poker,” telegraph.co.uk (April 16, 2005), www.telegraph
.co.uk/news/uknews/1487949/Whiz-kids-gamble-on-TV-
channel-for-poker.html .
108. G. A. Van Kleef, C. K. W. De Dreu, and A. S. R. Manstead,
“The Interpersonal Effects of Emotions in Negotiations:
A Motivated Information Processing Approach,” Journal
of Personality and Social Psychology 87, no. 4 (2004),
pp. 510–528; and G. A. Van Kleef, C. K. W. De Dreu, and
A. S. R. Manstead, “The Interpersonal Effects of Anger and
Happiness in Negotiations,” Journal of Personality and Social
Psychology 86, no. 1 (2004), pp. 57–76.
109. E. van Dijk, G. A. Van Kleef, W. Steinel, and I. van Beest,
“A Social Functional Approach to Emotions in Bargaining:
When Communicating Anger Pays and When It Backfires,”
Journal of Personality and Social Psychology 94, no. 4 (2008),
pp. 600–614.
110. K. M. O’Connor and J. A. Arnold, “Distributive Spirals:
Negotiation Impasses and the Moderating Role of
Disputant Self-Efficacy,” Organizational Behavior and Human
Decision Processes 84, no. 1 (2001), pp. 148–176.
111. B. Shiv, G. Loewenstein, A. Bechara, H. Damasio, and
A. R. Damasio, “Investment Behavior and the Negative
Side of Emotion,” Psychological Science 16, no. 6 (2005),
pp. 435–439.
112. W.-C. Tsai and Y.-M. Huang, “Mechanisms Linking
Employee Affective Delivery and Customer Behavioral
Intentions,” Journal of Applied Psychology (October 2002),
pp. 1001–1008.
113. Grandey, “When ‘The Show Must Go On.’ ”
114. See P. B. Barker and A. A. Grandey, “Service with a
Smile and Encounter Satisfaction: Emotional Contagion
and Appraisal Mechanisms,” Academy of Management
Journal 49, no. 6 (2006), pp. 1229–1238; and S. D. Pugh,
“Service with a Smile: Emotional Contagion in the Service
Encounter,” Academy of Management Journal (October 2001),
pp. 1018–1027.
115. D. E. Rupp and S. Spencer, “When Customers Lash
Out: The Effects of Customer Interactional Injustice on
Emotional Labor and the Mediating Role of Emotions,
Journal of Applied Psychology 91, no. 4 (2006), pp. 971–978;
and Tsai and Huang, “Mechanisms Linking Employee
Affective Delivery and Customer Behavioral Intentions.”
116. R. Ilies and T. A. Judge, “Understanding the Dynamic
Relationships Among Personality, Mood, and Job
Satisfaction: A Field Experience Sampling Study,”
Organizational Behavior and Human Decision Processes 89
(2002), pp. 1119–1139.
117. R. Rau, “Job Strain or Healthy Work: A Question of Task
Design,” Journal of Occupational Health Psychology 9, no. 4
(October 2004), pp. 322–338; and R. Rau and A. Triemer,
“Overtime in Relation to Blood Pressure and Mood During
Work, Leisure, and Night Time,” Social Indicators Research
67, no. 1–2 (June 2004), pp. 51–73.
118. Z. Song, M. Foo, and M. A. Uy, “Mood Spillover and
Crossover Among Dual-Earner Couples: A Cell Phone
Event Sampling Study,” Journal of Applied Psychology 93, no. 2
(2008), pp. 443–452.
119. T. A. Judge and R. Ilies, “Affect and Job Satisfaction: A
Study of Their Relationship at Work and at Home,” Journal
of Applied Psychology 89 (2004), pp. 661–673.
120. See R. J. Bennett and S. L. Robinson, “Development of
a Measure of Workplace Deviance,” Journal of Applied
Psychology, June 2000, pp. 349–360; see also P. R. Sackett
and C. J. DeVore, “Counterproductive Behaviors at
Work,” in N. Anderson, D. S. Ones, H. K. Sinangil, and
C. Viswesvaran (eds.), Handbook of Industrial, Work &
Organizational Psychology, vol. 1 (Thousand Oaks, CA: Sage,
2001), pp. 145–164.
121. A. G. Bedeian, “Workplace Envy,” Organizational Dynamics
(Spring 1995), p. 50; and Ben-Ze’ev, The Subtlety of Emotions,
pp. 281–326.
122. Bedeian, “Workplace Envy,” p. 54.
123. S. C. Douglas, C. Kiewitz, M. Martinko, P. Harvey, Y. Kim,
and J. U. Chun, “Cognitions, Emotions, and Evaluations: An
Elaboration Likelihood Model for Workplace Aggression,”
Academy of Management Review 33, no. 2 (2008), pp. 425–451.
124. K. Lee and N. J. Allen, “Organizational Citizenship Behavior
and Workplace Deviance: The Role of Affect and Cognition,”
Journal of Applied Psychology 87, no. 1 (2002), pp. 131–142;
T. A. Judge, B. A. Scott, and R. Ilies, “Hostility, Job Attitudes,
and Workplace Deviance: Test of a Multilevel Model,” Journal
of Applied Psychology 91, no. 1 (2006), 126–138; and S. Kaplan,
J. C. Bradley, J. N. Luchman, and D. Haynes, “On the Role
of Positive and Negative Affectivity in Job Performance:
A Meta-Analytic Investigation,” Journal of Applied Psychology
94, no. 1 (2009), pp. 162–176.
125. R. D. Iverson and P. J. Erwin, “Predicting Occupational
Injury: The Role of Affectivity,” Journal of Occupational and
Organizational Psychology 70, no. 2 (1997), pp. 113–128; and
Kaplan, Bradley, Luchman, and Haynes, “On the Role of
Positive and Negative Affectivity in Job Performance: A
Meta-Analytic Investigation.”
126. A. M. Isen, A. A. Labroo, and P. Durlach, “An Influence of
Product and Brand Name on Positive Affect: Implicit and
Explicit Measures,” Motivation & Emotion 28, no. 1 (March
2004), pp. 43–63.
127. T. Sy, S. Côté, and R. Saavedra, “The Contagious Leader:
Impact of the Leader’s Mood on the Mood of Group
Members, Group Affective Tone, and Group Processes,”
Journal of Applied Psychology 90, no. 2 (2005), pp. 295–305.
128. P. Totterdell, “Catching Moods and Hitting Runs: Mood
Linkage and Subjective Performance in Professional
Sports Teams,” Journal of Applied Psychology 85, no. 6 (2000),
pp. 848–859.
129. S. Nelton, “Emotions in the Workplace,” Nation’s Business
(February 1996), p. 25.
130. Kruml and Geddes, “Catching Fire Without Burning Out.”

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CHANGING OF THE GUARD IN JAPAN:
IS IT THE ECONOMY, OR THE VALUES?
130
A
mong the world’s largest economies, none has been more frustrat-
ingly stuck in neutral than Japan. Until 2010, when it was surpassed
by China, Japan was the world’s second-largest economy (after the
United States). However, it has now experienced two “lost decades” in a row,
spanning 1990 to 2010, and many recent college graduates have no memory
of the halcyon days of the 1980s, when Japan was the most envied economy
in the world. The horrendous aftermath of the earthquake and tsunami that
struck in March 2011, sending Japan into another recession, has only added
to the misery. Many now fear the Japanese economy will forever remain
stuck in the doldrums.
Perhaps it will rebound sooner than expected; Japan has been underesti-
mated before. However, two decades of stagnant economic growth seem to
have had a permanent effect on new entrants’ work values.
At one time, Japan was famous for the close psychological and behavioral
bond between company and worker. Most employees expected to remain
with their employer for their entire career, based on the belief that if they
took care of their company, their company would take care of them. To these
individuals, quitting, or taking a side job, would be an unthinkable act of
disloyalty.
How things have changed. While unemployment in Japan remains
low in comparison to the United States, it is at historic highs. Moreover,
earnings continue to shrink—down more than 12 percent over the past
decade. The Japanese Ministry of Health, Labor and Welfare estimates that
56 percent of workers age 15 to 34 need another form of income to pay
living expenses.
Hiroko Yokogawa, 32, makes one-third of her income from her second
job. “It’s not that I hate my main job, but I want to have a stable income
without being completely dependent on the company,” she said.
At first, Kirito Nakano, 28, followed the traditional career path, expecting
to remain forever in his job as a Web engineer with a large Japanese
multinational. Soon, however, he found that his salary, and lack of salary
growth, began to crimp his lifestyle. He began moonlighting, developing
affiliate marketing programs. As his side job grew, Kirito quit his main job. He
felt he was left with little choice. “The Japanese economy is not just stagnant,
it’s in retreat,” he said. “When people believe the future is going to be better
than the present, they are happy. But if they think that the future holds no
hope, then they become unhappy. It’s that unhappiness that people are
trying to negate with side jobs.”
LEARNING
OBJECTIVES
After studying this chapter,
you should be able to:
1 Define personality, describe
how it is measured, and
explain the factors that
determine an individual’s
personality.
2 Describe the Myers-Briggs
Type Indicator personality
framework and assess its
strengths and weaknesses.
3 Identify the key traits in the
Big Five personality model.
4 Demonstrate how the Big
Five traits predict behavior
at work.
5 Identify other personality
traits relevant to OB.
6 Define values, demonstrate
the importance of values,
and contrast terminal and
instrumental values.
7 Compare generational
differences in values and
identify the dominant
values in today’s workforce.
8 Identify Hofstede’s five
value dimensions of
national culture.
MyManagementLab
Access a host of interactive
learning aids to help strengthen
your understanding of the
chapter concepts at
www.mymanagementlab.com.

www.mymanagementlab.com

Personality
and Values
I am driven by fear of failure.
It is a strong motivator for me.
—Dennis Manning, CEO of Guardian Life Insurance Co.
5
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132 CHAPTER 5 Personality and Values
S A L
SELF-ASSESSMENT LIBRARY
The choice of young Japanese employees to work more hours is an inter-
esting contrast to workers in the United States and Europe, who express a
preference to work fewer hours. As for the hours she works—generally her side
job takes 25 hours a week— Hiroko Yokogawa remains undeterred. “I wouldn’t
say I want to leave my main job—rather, I’d like to have a couple of different
jobs at once.”
P
e
rc
e
n
t
In
d
ic
a
ti
n
g
V
a
lu
e
W
a
s
“V
e
ry
I
m
p
o
rt
a
n
t”
60
50
40
30
20
10
0
Generational Changes in What Is Valued in a JobOB Poll
College
Senior 1980
A job where you have more
than 2 weeks vacation
A job that gives you a
chance to make friends
A job that most
people respect
College
Senior 1995
College
Senior 2010
53.0
33.9
17.3
42.9
47.9
25.3
40.7
43.0
31.3
Source: Based on “What Millennial Workers Want: How to Attract and Retain Gen Y Employees,” Robert Half International web interviews of 1,007
individuals age 21–28, 2008.
A s the opening vignette indicates, employees with different values may enact different behaviors to achieve their work goals, and these differ-ences can be a reflection of culture. In the first half of this chapter, we
review the research on personality and its relationship to behavior. In the latter
half, we look at how values shape many of our work-related behaviors.
Although we focus much of our discussion on the Big Five personality traits,
they are not the only traits that describe people. One of the others we’ll discuss
is narcissism. Check out the Self-Assessment Library to see how you score on
narcissism (remember: be honest!).
Am I a Narcissist?
In the Self-Assessment Library (available on CD or online), take assessment
IV.A.1 (Am I a Narcissist?) and answer the following questions.
1. How did you score? Did your scores surprise you? Why or why not?
2. On which facet of narcissism did you score highest? Lowest?
3. Do you think this measure is accurate? Why or why not?

Personality 133
Personality
Why are some people quiet and passive, while others are loud and aggressive?
Are certain personality types better adapted than others for certain job types?
Before we can answer these questions, we need to address a more basic one:
What is personality?
What Is Personality?
When we talk of personality, we don’t mean a person has charm, a positive
attitude toward life, or a constantly smiling face. When psychologists talk of
personality, they mean a dynamic concept describing the growth and develop-
ment of a person’s whole psychological system.
Defining Personality The definition of personality we most frequently use was
produced by Gordon Allport nearly 70 years ago. Allport said personality is “the
dynamic organization within the individual of those psychophysical systems that
determine his unique adjustments to his environment.” 1 For our purposes, you
should think of personality as the sum total of ways in which an individual reacts
to and interacts with others. We most often describe it in terms of the measur-
able traits a person exhibits.
Measuring Personality The most important reason managers need to know
how to measure personality is that research has shown personality tests are
useful in hiring decisions and help managers forecast who is best for a job. 2
The most common means of measuring personality is through self-report
surveys, with which individuals evaluate themselves on a series of factors, such
as “I worry a lot about the future.” Though self-report measures work well when
well constructed, one weakness is that the respondent might lie or practice
impression management to create a good impression. When people know their
personality scores are going to be used for hiring decisions, they rate themselves
as about half a standard deviation more conscientious and emotionally stable
than if they are taking the test just to learn more about themselves. 3 Another
problem is accuracy. A perfectly good candidate could have been in a bad mood
when taking the survey, and that will make the scores less accurate.
Observer-ratings surveys provide an independent assessment of personal-
ity. Here, a co-worker or another observer does the rating (sometimes with
the subject’s knowledge and sometimes not). Though the results of self- report
surveys and observer-ratings surveys are strongly correlated, research sug-
gests observer-ratings surveys are a better predictor of success on the job. 4
However, each can tell us something unique about an individual’s behavior in
the workplace. An analysis of a large number of observer-reported personality
studies shows that a combination of self-report and observer-reports predicts
performance better than any one type of information. The implication is clear:
use both observer ratings and self-report ratings of personality when making
important employment decisions.
1 Define personality, describe
how it is measured, and
explain the factors that
determine an individual’s
personality.
personality Enduring characteristics
that describe an individual’s behavior.
MyManagementLab
For an interactive application of this
topic, check out this chapter’s
simulation activity at
www.mymanagementlab.com.

www.mymanagementlab.com

134 CHAPTER 5 Personality and Values
Personality Determinants An early debate in personality research centered on
whether an individual’s personality was the result of heredity or of environment.
It appears to be a result of both. However, it might surprise you that research
tends to support the importance of heredity over the environment.
Heredity refers to factors determined at conception. Physical stature, facial
attractiveness, gender, temperament, muscle composition and reflexes, energy
level, and biological rhythms are generally considered to be either completely
or substantially influenced by who your parents are—that is, by their biologi-
cal, physiological, and inherent psychological makeup. The heredity approach
argues that the ultimate explanation of an individual’s personality is the
molecular structure of the genes, located in the chromosomes.
Researchers in many different countries have studied thousands of sets of
identical twins who were separated at birth and raised separately. 5 If heredity
played little or no part in determining personality, you would expect to find
few similarities between the separated twins. But twins raised apart have much
in common, and a significant part of the behavioral similarity between them
turns out to be associated with genetic factors. One set of twins separated for
39 years and raised 45 miles apart were found to drive the same model and
color car. They chain-smoked the same brand of cigarette, owned dogs with
the same name, and regularly vacationed within three blocks of each other in
a beach community 1,500 miles away. Researchers have found that genetics
accounts for about 50 percent of the personality similarities between twins and
more than 30 percent of the similarities in occupational and leisure interests.
Interestingly, twin studies have suggested parents don’t add much to our
personality development. The personalities of identical twins raised in different
households are more similar to each other than to the personalities of siblings
with whom the twins were raised. Ironically, the most important contribution
our parents may make to our personalities is giving us their genes!
This is not to suggest that personality never changes. People’s scores on
measures of dependability tend to increase over time, as when young adults
take on roles like starting a family and establishing a career that require great
responsibility. However, strong individual differences in dependability remain;
Personality traits are enduring
characteristics that describe an
individual’s behavior. British entre-
preneur Richard Branson, chairman
of Virgin Group, is described as
energetic, enthusiastic, charismatic,
decisive, ambitious, adaptable,
courageous, and industrious. These
traits helped Branson build one of
the most recognized and respected
global brands for products and
services in the areas of business
travel, entertainment, and lifestyle.
In this photo Branson is joined
by his daughter Holly during the
promotional launch of a new
venture—the Marussia Virgin racing
partnership with Disney’s Cars 2
film. Identifying personality traits
helps organizations select employ-
ees and match workers to job.
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Personality 135
everyone tends to change by about the same amount, so their rank order stays
roughly the same. 6 An analogy to intelligence may make this clearer. Children
become smarter as they age, so nearly everyone is smarter at age 20 than at
age 10. Still, if Madison is smarter than Blake at age 10, she is likely to be so
at age 20, too. Consistent with the notion that the teenage years are periods
of great exploration and change, research has shown that personality is more
changeable in adolescence and more stable among adults. 7
Early work on the structure of personality tried to identify and label enduring
characteristics that describe an individual’s behavior, including shy, aggressive, sub-
missive, lazy, ambitious, loyal, and timid. When someone exhibits these characteris-
tics in a large number of situations, we call them personality traits of that person. 8
The more consistent the characteristic over time, and the more frequently it occurs
in diverse situations, the more important that trait is in describing the individual.
Early efforts to identify the primary traits that govern behavior 9 often
resulted in long lists that were difficult to generalize from and provided little
practical guidance to organizational decision makers. Two exceptions are the
Myers-Briggs Type Indicator and the Big Five Model, now the dominant frame-
works for identifying and classifying traits.
The Myers-Briggs Type Indicator
The Myers-Briggs Type Indicator (MBTI) is the most widely used personality-
assessment instrument in the world. 10 It is a 100-question personality test that
asks people how they usually feel or act in particular situations. Respondents
are classified as extraverted or introverted (E or I), sensing or intuitive (S or N),
thinking or feeling (T or F), and judging or perceiving (J or P). These terms are
defined as follows:
● Extraverted (E) versus Introverted (I). Extraverted individuals are outgoing,
sociable, and assertive. Introverts are quiet and shy.
● Sensing (S) versus Intuitive (N). Sensing types are practical and prefer
routine and order. They focus on details. Intuitives rely on unconscious
processes and look at the “big picture.”
● Thinking (T) versus Feeling (F). Thinking types use reason and logic to handle
problems. Feeling types rely on their personal values and emotions.
● Judging (J) versus Perceiving (P). Judging types want control and prefer their
world to be ordered and structured. Perceiving types are flexible and
spontaneous.
These classifications together describe 16 personality types, identifying every
person by one trait from each of the four pairs. For example, Introverted/
Intuitive/Thinking/Judging people (INTJs) are visionaries with original minds
and great drive. They are skeptical, critical, independent, determined, and
often stubborn. ESTJs are organizers. They are realistic, logical, analytical, and
decisive and have a natural head for business or mechanics. The ENTP type is a
conceptualizer, innovative, individualistic, versatile, and attracted to entrepre-
neurial ideas. This person tends to be resourceful in solving challenging prob-
lems but may neglect routine assignments.
The MBTI has been widely used by organizations including Apple Computer,
AT&T, Citigroup, GE, 3M Co., many hospitals and educational institutions, and
2 Describe the Myers-Briggs
Type Indicator personality
framework and assess its
strengths and weaknesses.
personality traits Enduring
characteristics that describe an
individual’s behavior.
Myers-Briggs Type Indicator (MBTI)
A personality test that taps four
characteristics and classifies people
into 1 of 16 personality types.
heredity Factors determined
at conception; one’s biological,
physiological, and inherent
psychological makeup.

136 CHAPTER 5 Personality and Values
even the U.S. Armed Forces. Evidence is mixed about its validity as a measure
of personality, however; most of the evidence is against it. 11 One problem is that
it forces a person into one type or another; that is, you’re either introverted
or extraverted. There is no in-between, though in reality people can be both
extraverted and introverted to some degree. The best we can say is that the
MBTI can be a valuable tool for increasing self-awareness and providing career
guidance. But because results tend to be unrelated to job performance, manag-
ers probably shouldn’t use it as a selection test for job candidates.
The Big Five Personality Model
The MBTI may lack strong supporting evidence, but an impressive body of
research supports the thesis of the Big Five Model —that five basic dimensions
underlie all others and encompass most of the significant variation in human
personality. 12 Moreover, test scores of these traits do a very good job of predict-
ing how people behave in a variety of real-life situations. 13 The following are the
Big Five factors:
● Extraversion. The extraversion dimension captures our comfort level with
relationships. Extraverts tend to be gregarious, assertive, and sociable.
Introverts tend to be reserved, timid, and quiet.
● Agreeableness. The agreeableness dimension refers to an individual’s
propensity to defer to others. Highly agreeable people are cooperative,
warm, and trusting. People who score low on agreeableness are cold,
disagreeable, and antagonistic.
● Conscientiousness. The conscientiousness dimension is a measure of
reliability. A highly conscientious person is responsible, organized,
dependable, and persistent. Those who score low on this dimension are
easily distracted, disorganized, and unreliable.
● Emotional stability. The emotional stability dimension—often labeled
by its converse, neuroticism—taps a person’s ability to withstand stress.
People with positive emotional stability tend to be calm, self-confident,
and secure. Those with high negative scores tend to be nervous, anxious,
depressed, and insecure.
● Openness to experience. The openness to experience dimension addresses
range of interests and fascination with novelty. Extremely open people
are creative, curious, and artistically sensitive. Those at the other end of
the category are conventional and find comfort in the familiar.
How Do the Big Five Traits Predict Behavior at Work? Research has found
relationships between these personality dimensions and job performance. 14 As
the authors of the most-cited review put it, “The preponderance of evidence
shows that individuals who are dependable, reliable, careful, thorough, able
to plan, organized, hardworking, persistent, and achievement-oriented tend
to have higher job performance in most if not all occupations.” 15 In addition,
employees who score higher in conscientiousness develop higher levels of job
knowledge, probably because highly conscientious people learn more (a review
of 138 studies revealed conscientiousness was rather strongly related to GPA). 16
Higher levels of job knowledge then contribute to higher levels of job perfor-
mance. Conscientious individuals who are more interested in learning than in
just performing on the job are also exceptionally good at maintaining perfor-
mance in the face of negative feedback. 17 There can be “too much of a good
thing,” however, as extremely conscientious individuals typically do not perform
better than those who are simply above average in conscientiousness. 18
3 Identify the key traits in the
Big Five personality model.
Andrea Jung, chairman and CEO of
Avon, scores high on all personality
dimensions of the Big Five Model.
She is sociable, agreeable, conscien-
tious, emotionally stable, and open
to experiences. These personality
traits have contributed to Jung’s
high job performance and career
success. Since joining Avon in 1994,
Jung has led a dramatic turnaround
of a company that had a poor
image, slow growth, and decline in
sales to one of the world’s top cos-
metics companies and the world’s
leading direct sales brand. She
transformed Avon by developing
and executing growth strategies,
launching new brand initiatives,
and developing earnings opportuni-
ties for women worldwide.
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Personality 137
Conscientiousness is as important for managers as for front-line employees.
As Exhibit 5-1 shows, a study of the personality scores of 313 CEO candidates
in private equity companies (of whom 225 were hired, and their com-
pany’s performance later correlated with their personality scores) found
conscientiousness—in the form of persistence, attention to detail, and setting
of high standards—was more important than other traits. These results attest to
the importance of conscientiousness to organizational success.
Interestingly, conscientious people live longer because they take better care
of themselves (they eat better and exercise more) and engage in fewer risky
behaviors like smoking, drinking and drugs, and risky sexual or driving behav-
ior. 19 Still, probably because they’re so organized and structured, conscientious
people don’t adapt as well to changing contexts. They are generally perfor-
mance oriented and have more trouble learning complex skills early in the
training process because their focus is on performing well rather than on
learning. Finally, they are often less creative than less conscientious people,
especially artistically. 20
Although conscientiousness is most consistently related to job performance,
the other Big Five traits are also related to aspects of performance and have other
implications for work and for life. Let’s look at them one at a time. Exhibit 5-2
summarizes.
Of the Big Five traits, emotional stability is most strongly related to life
satisfaction, job satisfaction, and low stress levels. This is probably true because
high scorers are more likely to be positive and optimistic and experience fewer
negative emotions. They are happier than those who score low. People low
on emotional stability are hypervigilant (looking for problems or impending
signs of danger) and are especially vulnerable to the physical and psychological
effects of stress. Extraverts tend to be happier in their jobs and in their lives as
a whole. They experience more positive emotions than do introverts, and they
more freely express these feelings. They also tend to perform better in jobs that
require significant interpersonal interaction, perhaps because they have more
social skills—they usually have more friends and spend more time in social
Traits That Matter Most to Business Success
at Buyout Companies
Exhibit 5-1
Most Important Less Important
Persistence Strong oral communication
Attention to detail Teamwork
Efficiency Flexibility/adaptability
Analytical skills Enthusiasm
Setting high standards Listening skills
4 Demonstrate how the Big
Five traits predict behavior
at work.
Big Five Model A personality
assessment model that taps five basic
dimensions.
agreeableness A personality
dimension that describes someone
who is good natured, cooperative, and
trusting.
conscientiousness A personality
dimension that describes someone
who is responsible, dependable,
persistent, and organized.
emotional stability A personality
dimension that characterizes someone
as calm, self-confident, secure
(positive) versus nervous, depressed,
and insecure (negative).
openness to experience A personality
dimension that characterizes someone
in terms of imagination, sensitivity,
and curiosity.
extraversion A personality dimension
describing someone who is sociable,
gregarious, and assertive.

138 CHAPTER 5 Personality and Values
situations than introverts. Finally, extraversion is a relatively strong predictor of
leadership emergence in groups; extraverts are more socially dominant, “take
charge” sorts of people, and they are generally more assertive than introverts. 21
One downside is that extraverts are more impulsive than introverts; they are
more likely to be absent from work and engage in risky behavior such as
unprotected sex, drinking, and other impulsive or sensation-seeking acts. 22 One
study also found extraverts were more likely than introverts to lie during job
interviews. 23
Individuals who score high on openness to experience are more cre-
ative in science and art than those who score low. Because creativity is im-
portant to leadership, open people are more likely to be effective leaders,
and more comfortable with ambiguity and change. They cope better with
organizational change and are more adaptable in changing contexts. Recent
evidence also suggests, however, that they are especially susceptible to work-
place accidents. 24
You might expect agreeable people to be happier than disagreeable people.
They are, but only slightly. When people choose romantic partners, friends,
or organizational team members, agreeable individuals are usually their first
choice. Agreeable individuals are better liked than disagreeable people, which
explains why they tend to do better in interpersonally oriented jobs such as
customer service. They also are more compliant and rule abiding and less likely
to get into accidents as a result. People who are agreeable are more satisfied in
their jobs and contribute to organizational performance by engaging in citizen-
Model of How Big Five Traits Influence OB Criteria
* In jobs requiring significant teamwork or frequent interpersonal interactions.
Exhibit 5-2
• Less negative thinking and
fewer negative emotions
• Less hyper-vigilant
• Higher job & life satisfaction
• Lower stress levels
• Better interpersonal skills
• Greater social dominance
• More emotionally expressive
Extroversion
• Higher performance*
• Enhanced leadership
• Higher job & life satisfaction
• Increased learning
• More creative
• More flexible & autonomous
Openness
• Training performance
• Enhanced leadership
• More adaptable to change
• Better liked
• More compliant and
conforming
Agreeableness
• Higher performance*
• Lower levels of deviant
behavior
• Greater effort & persistence
• More drive and discipline
• Better organized & planning
Conscientiousness
• Higher performance
• Enhanced leadership
• Greater longevity
BIG FIVE TRAITS WHY IS IT RELEVANT? WHAT DOES IT AFFECT?
Emotional stability

Personality 139
ship behavior. 25 They are also less likely to engage in organizational deviance.
One downside is that agreeableness is associated with lower levels of career
success (especially earnings).
The five personality factors identified in the Big Five model appear in
almost all cross-cultural studies. 26 These studies have included a wide variety
of diverse cultures—such as China, Israel, Germany, Japan, Spain, Nigeria,
Norway, Pakistan, and the United States. Differences are complex but tend to
be primarily about whether countries are predominantly individualistic or col-
lectivistic. Chinese managers use the category of conscientiousness more often
and agreeableness less often than do U.S. managers. And the Big Five appear
to predict a bit better in individualistic than in collectivist cultures. 27 But there
is a surprisingly high amount of agreement, especially across individuals from
developed countries. A comprehensive review of studies covering people from
what was then the 15-nation European Community found conscientiousness a
valid predictor of performance across jobs and occupational groups. 28 This is
exactly what U.S. studies have found.
Other Personality Traits Relevant to OB
Although the Big Five traits have proven highly relevant to OB, they don’t
exhaust the range of traits that can describe someone’s personality. Now we’ll
look at other, more specific, attributes that are powerful predictors of behav-
ior in organizations. The first relates to our core self-evaluation. The others
are Machiavellianism, narcissism, self-monitoring, propensity for risk taking,
proactive personality, and other-orientation.
Core Self-Evaluation People who have positive core self-evaluations like
themselves and see themselves as effective, capable, and in control of their
environment. Those with negative core self-evaluations tend to dislike them-
selves, question their capabilities, and view themselves as powerless over their
environment. 29 We discussed in Chapter 3 that core self-evaluations relate to job
satisfaction because people positive on this trait see more challenge in their job
and actually attain more complex jobs.
But what about job performance? People with positive core self-evaluations
perform better than others because they set more ambitious goals, are more
committed to their goals, and persist longer in attempting to reach these goals.
One study of life insurance agents found core self-evaluations were critical
predictors of performance. Ninety percent of life insurance sales calls end in
rejection, so an agent has to believe in him- or herself to persist. In fact, this
study showed the majority of successful salespersons did have positive core
self-evaluations. 30 Such people also provide better customer service, are more
popular co-workers, and have careers that both begin on better footing and
ascend more rapidly over time. 31 Some evidence suggests that individuals high in
core self-evaluations perform especially well if they also feel their work provides
meaning and is helpful to others. 32
Can we be too positive? What happens when someone thinks he is capable
but is actually incompetent? One study of Fortune 500 CEOs showed that many
are overconfident, and their perceived infallibility often causes them to make
bad decisions. 33 Teddy Forstmann, chairman of the sports marketing giant
core self-evaluation Bottom-line
conclusions individuals have about
their capabilities, competence, and
worth as a person.
The personality trait of positive core
self-evaluation helps Satoru Iwata
meet the challenges and complex-
ity of his job as CEO of Nintendo.
Confident and capable, Iwata has
applied his years of experience and
innovation as a game developer to
introducing new products, such as
the Wii gaming console and the 3DS
portable console. Iwata views his
job as an opportunity to cultivate
new customers by widening the
appeal of video games to new mar-
ket segments in developed nations
and by introducing products to
developing countries.
5 Identify other personality
traits relevant to OB.
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140 CHAPTER 5 Personality and Values
IMG, said of himself, “I know God gave me an unusual brain. I can’t deny that.
I have a God-given talent for seeing potential.” 34 We might say people like
Forstmann are overconfident, but very often we humans sell ourselves short
and are less happy and effective than we could be because of it. If we decide we
can’t do something, for example, we won’t try, and not doing it only reinforces
our self-doubts.
Machiavellianism Kuzi is a young bank manager in Taiwan. He’s had three
promotions in the past 4 years and makes no apologies for the aggressive tactics
he’s used to propel his career upward. “I’m prepared to do whatever I have to
do to get ahead,” he says. Kuzi would properly be called Machiavellian.
The personality characteristic of Machiavellianism (often abbreviated Mach )
is named after Niccolo Machiavelli, who wrote in the sixteenth century on how
to gain and use power. An individual high in Machiavellianism is pragmatic,
maintains emotional distance, and believes ends can justify means. “If it works,
use it” is consistent with a high-Mach perspective. A considerable amount of
research has found high Machs manipulate more, win more, are persuaded
less, and persuade others more than do low Machs. 35 They like their jobs less,
are more stressed by their work, and engage in more deviant work behaviors. 36
Yet high-Mach outcomes are moderated by situational factors. High Machs
flourish (1) when they interact face to face with others rather than indirectly;
(2) when the situation has minimal rules and regulations, allowing latitude for
improvisation; and (3) when emotional involvement with details irrelevant to
winning distracts low Machs. 37 Thus, in jobs that require bargaining skills (such
as labor negotiation) or that offer substantial rewards for winning (such as
commissioned sales), high Machs will be productive. But if ends can’t justify the
means, there are absolute standards of behavior, or the three situational factors
we noted are not in evidence, our ability to predict a high Mach’s performance
will be severely curtailed.
Narcissism Hans likes to be the center of attention. He looks at himself in the
mirror a lot, has extravagant dreams, and considers himself a person of many
talents. Hans is a narcissist. The term is from the Greek myth of Narcissus, a
man so vain and proud he fell in love with his own image. In psychology, narcis-
sism describes a person who has a grandiose sense of self-importance, requires
excessive admiration, has a sense of entitlement, and is arrogant. Evidence
suggests that narcissists are more charismatic and thus more likely to emerge as
leaders, and they may even display better psychological health (at least as they
self-report). 38
Despite having some advantages, most evidence suggests that narcissism
is undesirable. A study found that while narcissists thought they were better
leaders than their colleagues, their supervisors actually rated them as worse.
An Oracle executive described that company’s CEO Larry Ellison as fol-
lows: “The difference between God and Larry is that God does not believe
he is Larry.” 39 Because narcissists often want to gain the admiration of oth-
ers and receive affirmation of their superiority, they tend to “talk down” to
those who threaten them, treating others as if they were inferior. Narcissists
also tend to be selfish and exploitive and believe others exist for their ben-
efit. 40 Their bosses rate them as less effective at their jobs than others, par-
ticularly when it comes to helping people. 41 Subsequent research using data
compiled over 100 years has shown that narcissistic CEOs of baseball or-
ganizations tend to generate higher levels of manager turnover, although
curiously, members of external organizations see them as more influential. 42

Personality 141
Self-Monitoring Joyce McIntyre is always in trouble at work. Though she’s
competent, hardworking, and productive, in performance reviews she is rated
no better than average, and she seems to have made a career of irritating
bosses. Joyce’s problem is that she’s politically inept. She’s unable to adjust her
behavior to fit changing situations. As she puts it, “I’m true to myself. I don’t
remake myself to please others.” We would describe Joyce as a low self-monitor.
Self-monitoring refers to an individual’s ability to adjust his or her behav-
ior to external, situational factors. 43 Individuals high in self-monitoring show
considerable adaptability in adjusting their behavior to external situational
factors. They are highly sensitive to external cues and can behave differently
in different situations, sometimes presenting striking contradictions between
their public persona and their private self. Low self-monitors, like Joyce, can’t
disguise themselves in that way. They tend to display their true dispositions and
attitudes in every situation; hence, there is high behavioral consistency between
who they are and what they do.
Evidence indicates high self-monitors pay closer attention to the behavior
of others and are more capable of conforming than are low self-monitors. 44
They also receive better performance ratings, are more likely to emerge as
leaders, and show less commitment to their organizations. 45 In addition, high
self- monitoring managers tend to be more mobile in their careers, receive
more promotions (both internal and cross-organizational), and are more likely
to occupy central positions in an organization. 46
Risk Taking Donald Trump stands out for his willingness to take risks. He
started with almost nothing in the 1960s. By the mid-1980s, he had made a
fortune by betting on a resurgent New York City real estate market. Then,
trying to capitalize on his successes, Trump overextended himself. By 1994, he
had a negative net worth of $850 million. Never fearful of taking chances, “The
Donald” leveraged the few assets he had left on several New York, New Jersey,
and Caribbean real estate ventures and hit it big again. In 2011, when Trump
was contemplating a presidential run, The Atlantic estimated his net worth at
more than $7 billion. 47
People differ in their willingness to take chances, a quality that affects
how much time and information they need to make a decision. For instance,
79 managers worked on simulated exercises that required them to make hiring
decisions. 48 High risk-taking managers made more rapid decisions and used less
information than did the low risk takers. Interestingly, decision accuracy was
the same for both groups.
Although previous studies have shown managers in large organizations to
be more risk averse than growth-oriented entrepreneurs who actively manage
small businesses, recent findings suggest managers in large organizations may
actually be more willing to take risks than entrepreneurs. 49 The work popula-
tion as a whole also differs in risk propensity. 50 It makes sense to recognize
these differences and even consider aligning them with specific job demands.
A high risk-taking propensity may lead to more effective performance for a stock
trader in a brokerage firm because that type of job demands rapid decision
Machiavellianism The degree to
which an individual is pragmatic,
maintains emotional distance, and
believes that ends can justify means.
self-monitoring A personality
trait that measures an individual’s
ability to adjust his or her behavior to
external, situational factors.
narcissism The tendency to be
arrogant, have a grandiose sense
of self-importance, require excessive
admiration, and have a sense of
entitlement.

142 CHAPTER 5 Personality and Values
making. On the other hand, a willingness to take risks might prove a major
obstacle to an accountant who performs auditing activities.
Proactive Personality Did you ever notice that some people actively take the
initiative to improve their current circumstances or create new ones? These are
proactive personalities. 51 Those with a proactive personality identify opportuni-
ties, show initiative, take action, and persevere until meaningful change occurs,
compared to others who passively react to situations. Proactives create positive
change in their environment, regardless of, or even in spite of, constraints or
obstacles. 52 Not surprisingly, they have many desirable behaviors that organiza-
tions covet. They are more likely than others to be seen as leaders and to act as
change agents. 53 Proactive individuals are more likely to be satisfied with work
and help others more with their tasks, largely because they build more relation-
ships with others. 54
Proactives are also more likely to challenge the status quo or voice their
displeasure when situations aren’t to their liking. 55 If an organization requires
people with entrepreneurial initiative, proactives make good candidates;
however, they’re also more likely to leave an organization to start their own busi-
ness. 56 As individuals, proactives are more likely than others to achieve career
success. 57 They select, create, and influence work situations in their favor. They
seek out job and organizational information, develop contacts in high places,
engage in career planning, and demonstrate persistence in the face of career
obstacles.
Other-orientation Some people just naturally seem to think about other peo-
ple a lot, being concerned about their well-being and feelings. Others behave
like “economic actors,” primarily rational and self-interested. These differences
T
his statement is true.
Studies of identical twins
reared apart suggest striking
career similarities—if one twin became
an entrepreneur, the other twin was
more likely to do the same. The expla-
nation may lie in personality.
One recent analysis of 60 stud-
ies linked individuals’ personali-
ties to their intentions to undertake
an entrepreneurial career, and to
the performance of their ventures
once they made that decision. The
Big Five personality traits—except
agreeableness, which didn’t matter—
significantly predicted entrepreneurial
intentions and, more significantly,
entrepreneurial firm performance.
Especially important were openness
to experience and conscientiousness,
both of which also predicted firm
growth over time. Interestingly, risk
propensity—the tendency to take and
be comfortable with taking risks—was
not associated with entrepreneurial
performance.
What are the implications of these
findings? Traditionally, people who saw
themselves as risk averse were steered
away from entrepreneurship. However,
these results suggest it is more impor-
tant to steer low scorers on openness
and conscientiousness away. The best
entrepreneurs appear not to be the
swashbuckling risk-takers, but rather
the methodical ones who have the
discipline to turn their open thinking
and creative ideas into reality.
Sources: H. Zhao, S. E. Seibert, and G. T.
Lumpkin, “The Relationship of Personality
t o E n t r e p r e n e u r i a l I n t e n t i o n s a n d
Performance: A Meta-Analytic Review,”
Journal of Management 36, no. 2 (2010),
pp. 381–404; M. Herper, “Could We Invent
an Antibody to Make You an Entrepreneur?”
Forbes (May 5, 2011), downloaded on
May 23, 2011, from http://blogs.forbes.com/ .
Myth or Science?
Personality Predicts the Performance
of Entrepreneurs

http://blogs.forbes.com/

Personality 143
reflect varying levels of other-orientation, a personality trait that reflects the
extent to which decisions are affected by social influences and concerns vs. our
own well-being and outcomes. 58
What are the consequences of having a high level of other-orientation?
Those who are other-oriented feel more obligated to help others who have
helped them (pay me back), whereas those who are more self-oriented will
help others when they expect to be helped in the future (pay me forward). 59
Employees high in other-orientation also exert especially high levels of effort
when engaged in helping work or prosocial behavior. 60 In sum, it appears that
having a strong orientation toward helping others does affect some behaviors
that actually matter for organizations. However, research is still needed to
clarify this emerging construct and its relationship with agreeableness.
Having discussed personality traits—the enduring characteristics that
describe a person’s behavior—we now turn to values. Values are often very
specific and describe belief systems rather than behavioral tendencies. Some
beliefs or values don’t say much about a person’s personality, and we don’t
always act consistently with our values.
A
s work becomes increas-
ingly international in focus,
successful managers need to
be able to operate across cultures eas-
ily. Obviously, expatriate managers
working in other countries will need
personality traits that make them better
able to work overseas, but managers
at home who order parts and services
from overseas or prepare marketing
plans for other countries, for example,
will also conduct cross-cultural com-
munications. In the workforce of the
future, everyone from mechanics to
customer service representatives to
advertisers will need to understand the
global market. What is the right per-
sonality for a global workplace?
You might suspect that, of the Big
Five traits, openness to experience
would be most important to effective-
ness in international assignments. Open
people are more likely to be culturally
flexible—to “go with the flow” when
things are different in another country.
Research is not fully consistent on the
issue, but most does suggest that man-
agers who score high on openness per-
form better than others in international
assignments. Other evidence suggests
that employees who are more agree-
able and extraverted have an easier
time with international assignments.
They may be better at establishing
new relationships and developing social
networks in unfamiliar contexts.
What do these results imply for
organizations? Given continuing
globalization in the future, organiza-
tions should select employees with
traits related to better performance in
international assignments. Managers
will need to foster an open-minded
perspective about other cultures
among their employees.
Sources: Based on M. A. Shaffer, D. A.
Harrison, and H. Gregersen, “You Can
Take It with You: Individual Differences and
Expatriate Effectiveness,” Journal of Applied
Psychology 91 , no. 1 (2006), pp. 109–125;
M. van Woerkom and R. S. M. de Reuver,
“Predicting Excellent Management
Performance in an Intercultural Context:
A Study of the Influence of Multicultural
Personality on Transformational Leadership
and Performance,” International Journal of
Human Resource Management 20, no. 10
(2009), pp. 2013–2029; and M. Downes,
I. I. Varner, and M. Hemmasi, “Individual
Profiles as Predictors of Expatriate
Effectiveness,” Competitiveness Review
20 , no. 3 (2010), pp. 235–247.
glOBalization!
The Right Personality for a Global Workplace
proactive personality People who
identify opportunities, show initiative,
take action, and persevere until
meaningful change occurs.

144 CHAPTER 5 Personality and Values
Values
Is capital punishment right or wrong? If a person likes power, is that good or
bad? The answers to these questions are value laden. Some might argue capital
punishment is right because it is an appropriate retribution for crimes such as
murder and treason. Others might argue, just as strongly, that no government
has the right to take anyone’s life.
Values represent basic convictions that “a specific mode of conduct or
end-state of existence is personally or socially preferable to an opposite or con-
verse mode of conduct or end-state of existence.” 61 They contain a judgmental
element in that they carry an individual’s ideas as to what is right, good, or
desirable. Values have both content and intensity attributes. The content
attribute says a mode of conduct or end-state of existence is important. The in-
tensity attribute specifies how important it is. When we rank an individual’s values
in terms of their intensity, we obtain that person’s value system . All of us have
a hierarchy of values that forms our value system. We find it in the relative
importance we assign to values such as freedom, pleasure, self-respect, honesty,
obedience, and equality.
Are values fluid and flexible? Generally speaking, no. They tend to be
relatively stable and enduring. 62 A significant portion of the values we hold
is established in our early years—by parents, teachers, friends, and others.
As children, we are told certain behaviors or outcomes are always desirable
or always undesirable, with few gray areas. You were never taught to be just a
little bit honest or a little bit responsible, for example. It is this absolute, or
“black- or-white,” learning of values that ensures their stability and endurance.
If we question our values, of course, they may change, but more often they are
reinforced. There is also evidence linking personality to values, implying our
values may be partly determined by our genetically transmitted traits. 63
The Importance of Values
Values lay the foundation for our understanding of people’s attitudes and
motivation and influence our perceptions. We enter an organization with
preconceived notions of what “ought” and “ought not” to be. These notions
are not value-free; on the contrary, they contain our interpretations of right
and wrong and our preference for certain behaviors or outcomes over others.
As a result, values cloud objectivity and rationality; they influence attitudes and
behavior. 64
Suppose you enter an organization with the view that allocating pay on the
basis of performance is right, while allocating pay on the basis of seniority is
wrong. How will you react if you find the organization you’ve just joined rewards
seniority and not performance? You’re likely to be disappointed—and this
can lead to job dissatisfaction and a decision not to exert a high level of effort
because “It’s probably not going to lead to more money anyway.” Would your
attitudes and behavior be different if your values aligned with the organization’s
pay policies? Most likely.
Terminal versus Instrumental Values
Can we classify values? Yes. In this section, we review two approaches to
developing value typologies.
6 Define values, demonstrate
the importance of values,
and contrast terminal and
instrumental values.

Values 145
Rokeach Value Survey Milton Rokeach created the Rokeach Value Sur-
vey (RVS). 65 It consists of two sets of values, each containing 18 individual
value items. One set, called terminal values , refers to desirable end-states.
These are the goals a person would like to achieve during his or her lifetime.
The other set, called instrumental values , refers to preferable modes of be-
havior, or means of achieving the terminal values. Some examples of terminal
values in the Rokeach Value Survey are: Prosperity and economic success, Free-
dom, Health and well-being, World peace, Social recognition, and Meaning in
life. The types of instrumental values illustrated in RVS are Self-improvement,
Autonomy and self-reliance, Personal discipline, kindness, Ambition, and
Goal-orientation.
Several studies confirm that RVS values vary among groups. 66 People in
the same occupations or categories (corporate managers, union members,
parents, students) tend to hold similar values. One study compared corporate
executives, members of the steelworkers’ union, and members of a commu-
nity activist group. Although there was a good deal of overlap among them, 67
there were also significant differences (see Exhibit 5-3 ). The activists ranked
“equality” as their most important terminal value; executives and union mem-
bers ranked this value 12 and 13, respectively. Activists ranked “helpful” as
their second-highest instrumental value. The other two groups both ranked it
14. Because executives, union members, and activists all have a vested interest
in what corporations do, these differences can create serious conflicts when
groups contend with each other over an organization’s economic and social
policies. 68
Generational Values
Contemporary Work Cohorts Researchers have integrated several recent anal-
yses of work values into four groups that attempt to capture the unique values
EXECUTIVES UNION MEMBERS ACTIVISTS
Terminal Instrumental Terminal Instrumental Terminal Instrumental
1. Self-respect 1. Honest 1. Family security 1. Responsible 1. Equality 1. Honest
2. Family security 2. Responsible 2. Freedom 2. Honest 2. A world of peace 2. Helpful
3. Freedom 3. Capable 3. Happiness 3. Courageous 3. Family security 3. Courageous
4. A sense of accomplishment 4. Ambitious 4. Self-respect 4. Independent 4. Self-respect 4. Responsible
5. Happiness 5. Independent 5. Mature love 5. Capable 5. Freedom 5. Capable
Mean Value Ranking Executives, Union Members, and Activisits (Top Five Only)
Source: Based on W. C. Frederick and J. Weber, “The Values of Corporate Managers and Their Critics: An Empirical Description and Normative Implications,” in W. C. Frederick and L. E. Preston
(eds.), Business Ethics: Research Issues and Empirical Studies (Greenwich, CT: JAI Press, 1990), pp. 123–144.
Exhibit 5-3
values Basic convictions that a
specific mode of conduct or end-state
of existence is personally or socially
preferable to an opposite or converse
mode of conduct or end-state of
existence.
value system A hierarchy based on
a ranking of an individual’s values in
terms of their intensity.
terminal values Desirable end-states of
existence; the goals a person would like
to achieve during his or her lifetime.
instrumental values Preferable modes
of behavior or means of achieving
one’s terminal values.
7 Compare generational
differences in values and
identify the dominant values
in today’s workforce.

146 CHAPTER 5 Personality and Values
of different cohorts or generations in the U.S. workforce. 69 Exhibit 5-4 segments
employees by the era during which they entered the workforce. Because most
people start work between the ages of 18 and 23, the eras also correlate closely
with employee age.
Let’s start with some limitations of this analysis. First, we make no assump-
tion that the framework applies across all cultures. Second, despite a steady
stream of press coverage, there is very little rigorous research on generational
values, so we have to rely on an intuitive framework. Finally, these are imprecise
categories. There is no law that someone born in 1985 can’t have values similar
to those of someone born in 1955. Despite these limitations, values do change
over generations, 70 and we can gain some useful insights from analyzing values
this way.
Boomers ( Baby Boomers ) are a large cohort born after World War II when
veterans returned to their families and times were good. Boomers entered the
workforce from the mid-1960s through the mid-1980s. They brought with them
a large measure of the “hippie ethic” and distrust of authority. But they place a
great deal of emphasis on achievement and material success. Pragmatists who
believe ends can justify means, they work hard and want to enjoy the fruits of
their labors. Boomers see the organizations that employ them merely as vehi-
cles for their careers. Terminal values such as a sense of accomplishment and
social recognition rank high with them.
The lives of Xers ( Generation Xers ) have been shaped by globalization,
two-career parents, MTV, AIDS, and computers. Xers value flexibility, life
options, and the achievement of job satisfaction. Family and relationships are
very important. Xers are skeptical, particularly of authority. They also enjoy
team-oriented work. In search of balance in their lives, Xers are less willing
to make personal sacrifices for the sake of their employer than previous
generations were. On the RVS, they rate high on true friendship, happiness,
and pleasure.
The most recent entrants to the workforce, the Millennials (also called
Netters, Nexters, Generation Yers, and Generation Nexters ) grew up during
prosperous times. They have high expectations and seek meaning in their
work. Millennials have life goals more oriented toward becoming rich
(81 percent) and famous (51 percent) than do Generation Xers (62 per-
cent and 29 percent, respectively), but they also see themselves as socially
responsible. At ease with diversity, Millennials are the first generation to
take technology for granted. More than other generations, they tend to be
questioning, electronically networked, and entrepreneurial. At the same
time, some have described Millennials as entitled and needy. They may clash
Entered the Approximate
Cohort Workforce Current Age Dominant Work Values
Boomers 1965–1985 Mid-40s to mid-60s Success, achievement, ambition,
dislike of authority; loyalty to
career
Xers 1985–2000 Late 20s to early 40s Work/life balance, team-oriented,
dislike of rules; loyalty to
relationships
Nexters 2000 to present Under 30 Confident, financial success, self-
reliant but team-oriented; loyalty
to both self and relationships
Dominant Work Values in Today’s Workforce Exhibit 5-4

Values 147
A
s we have noted, individuals
differ in terms of their per-
sonality scores, and these
differences contribute to effective
performance. It isn’t always possible
to identify personality traits success-
fully during the hiring process, and
sometimes there simply aren’t enough
people with the “right” personality
traits available. So should organiza-
tions try to shape their employees
to make them more conscientious,
agreeable, open, emotionally stable,
and extraverted? Is there a potential
ethical problem with exercising this
type of control over workers?
Some evidence suggests that
people’s basic temperament is largely
fixed by biology, and in this case, at-
tempts to change personality will
mostly lead to frustration and dissat-
isfaction. An employee who tends
to see things negatively is unlikely
to suddenly become an optimist
just because a manager pushes him
or her to read self-help books and
take up meditation. Moreover, such
efforts may send a strong message of
disapproval—who would want a man-
ager saying, “We don’t like you the
way you are, you need to change!”
Employees who are forced into work-
ing environments that don’t fit their
dispositions will also likely experience
high levels of psychological strain.
On the other hand, it is possible
to change the way personality is ex-
pressed. Biological anthropologist
Helen Fisher notes that despite the im-
portance of biology, “the environment
always molds your biology.” Someone
who isn’t particularly open to experi-
ence might be comfortable with new
work assignments if they’re framed
appropriately, and someone who isn’t
very conscientious can display orga-
nization and dutifulness if the right
environmental supports like check-
lists and formalized goal-setting are
in place. And personality does change
somewhat over time. As people age,
their scores on conscientiousness and
agreeableness increase rather dramati-
cally, and neuroticism decreases sub-
stantially (the results for openness and
extraversion are more complex).
So what might employers do to
accommodate employee personality
differences while still obtaining maxi-
mum performance? One strategy is
to focus on outcomes and allow em-
ployees to determine their own way
to achieve them. An extrovert and an
introvert might both be able to produce
a very high quality report, even if the
extrovert will want to collaborate and
discuss during the process of writing
whereas the introvert will prefer to work
out problems alone. Employers can also
try to assign employees to activities that
best match their personality types.
Sources: B. W. Roberts and D. Mroczek,
“Personality Trait Change in Adulthood,”
Current Directions in Psychological Science,
no. 1, Vol. 17 (2008), pp. 31–35; “Five Ways
to Change Your Personality,” CBS News
(August 21, 2010), www.cbsnews.com .
An Ethical Choice
Should You Try to Change Someone’s Personality?
EBay’s young employees rank
their employer as one of the best
places to work for millennials. The
company’s culture of fun, casual
dress, and flexible work schedules
that provide for a work/life balance
appeal to Generation Y employees
like those shown here at eBay’s
offices in San Jose, California.
Young employees say that eBay
managers give them job responsibil-
ity quickly, generous recognition
for their achievements, and learn-
ing opportunities to advance their
careers. They also admire eBay’s
“Social Venture” initiatives such
as WorldofGood.com , eBay Giving
Works, and MicroPlace that make
a positive difference in the lives of
people throughout the world.
So
ur
ce
: J
im
W
ils
on
/T
he
N
ew
Y
or
k
Ti
m
es
/R
ed
ux
P
ic
tu
re
ss
.

www.cbsnews.com

148 CHAPTER 5 Personality and Values
with other generations over work attire and communication. They also like
feedback. An Ernst & Young survey found that 85 percent of Millennials
want “frequent and candid performance feedback,” compared to only half
of Boomers. 71
Though it is fascinating to think about generational values, remem-
ber these classifications lack solid research support. Recent reviews suggest
many of the generalizations are either overblown or incorrect. 72 Studies
that have found differences across generations do not support the popular
conceptions of how generations differ, and most are plagued with method-
ological problems that make it difficult to assess whether differences actually
exist. One study that used an appropriate longitudinal design did find the
value placed on leisure increased over generations from the Baby Boomers
to the Millennials and work centrality has declined, but it did not find that
Millennials had higher altruistic work values as expected. 73 Generational clas-
sifications may help us understand our own and other generations better, but
we must also appreciate their limits.
Linking an Individual’s Personality
and Values to the Workplace
Thirty years ago, organizations were concerned only with personality because
their primary focus was to match individuals to specific jobs. That concern has
expanded to include how well the individual’s personality and values match the
organization. Why? Because managers today are less interested in an applicant’s
ability to perform a specific job than with his or her flexibility to meet changing
situations and commitment to the organization.
We’ll now discuss person–job fit and person–organization fit in more detail.
Person–Job Fit
The effort to match job requirements with personality characteristics is best
articulated in John Holland’s personality–job fit theory . 74 Holland presents
six personality types and proposes that satisfaction and the propensity to leave
a position depend on how well individuals match their personalities to a job.
Exhibit 5-5 describes the six types, their personality characteristics, and exam-
ples of the congruent occupations for each.
Holland developed the Vocational Preference Inventory questionnaire,
which contains 160 occupational titles. Respondents indicate which they like or
dislike, and their answers form personality profiles. Research strongly supports
the resulting hexagonal diagram shown in Exhibit 5-6 . 75 The closer two fields or
orientations are in the hexagon, the more compatible they are. Adjacent cate-
gories are quite similar, whereas diagonally opposite ones are highly dissimilar.
What does all this mean? The theory argues that satisfaction is highest and
turnover lowest when personality and occupation are in agreement. A realistic
person in a realistic job is in a more congruent situation than a realistic person in
an investigative job. A realistic person in a social job is in the most incongruent
situation possible. The key points of this model are that (1) there do appear to

Linking an Individual’s Personality and Values to the Workplace 149
be intrinsic differences in personality among individuals, (2) there are different
types of jobs, and (3) people in jobs congruent with their personality should
be more satisfied and less likely to voluntarily resign than people in incongru-
ent jobs. Evidence supports the value of assessing vocational interests in the
selection process, with a match between interests and job requirements predict-
ing job knowledge, performance, and low likelihood of turnover. 76
Type Personality Characteristics Congruent Occupations
Realistic: Prefers physical activities that Shy, genuine, persistent, stable, conforming, Mechanic, drill press operator,
require skill, strength, and coordination practical assembly-line worker, farmer
Investigative: Prefers activities that involve Analytical, original, curious, independent Biologist, economist, mathematician,
thinking, organizing, and understanding news reporter
Social: Prefers activities that involve Sociable, friendly, cooperative, understanding Social worker, teacher, counselor,
helping and developing others clinical psychologist
Conventional: Prefers rule-regulated, Conforming, efficient, practical, unimaginative, Accountant, corporate manager, bank
orderly, and unambiguous activities inflexible teller, file clerk
Enterprising: Prefers verbal activities Self-confident, ambitious, energetic, Lawyer, real estate agent, public
in which there are opportunities to domineering relations specialist, small business
influence others and attain power manager
Artistic: Prefers ambiguous and Imaginative, disorderly, idealistic, emotional, Painter, musician, writer, interior
unsystematic activities that allow impractical decorator
creative expression
Holland’s Typology of Personality and Congruent Occupations Exhibit 5-5
A
rtistic
(A
)
Rea
listi
c
(R)
Investigative(I)
Enterprising(E)
C
on
ve
nt
io
na
l
(C
)
Soc
ial
(S)
Relationships Among Occupational Personality Types
Source: Reprinted by special permission of the publisher, Psychological Assessment Resources, Inc., from Making Vocational Choices,
copyright 1973, 1985, 1992 by Psychological Assessment Resources, Inc. All rights reserved.
Exhibit 5-6
personality–job fit theory A theory
that identifies six personality types
and proposes that the fit between
personality type and occupational
environment determines satisfaction
and turnover.

150 CHAPTER 5 Personality and Values
As you might expect, Holland types relate to personality scales. One study
found individuals higher in openness to experience as children were more
likely to take jobs high on the investigative and artistic dimensions as adults,
and those higher in conscientiousness as children were more likely to work in
conventional jobs as adults. 77
Person–Organization Fit
We’ve noted that researchers have looked at matching people to organizations
as well as to jobs. If an organization faces a dynamic and changing environment
and requires employees able to readily change tasks and move easily between
teams, it’s more important that employees’ personalities fit with the overall
organization’s culture than with the characteristics of any specific job.
The person–organization fit essentially argues that people are attracted to
and selected by organizations that match their values, and they leave organiza-
tions that are not compatible with their personalities. 78 Using the Big Five termi-
nology, for instance, we could expect that people high on extraversion fit well
with aggressive and team-oriented cultures, that people high on agreeableness
match up better with a supportive organizational climate than one focused on
aggressiveness, and that people high on openness to experience fit better in or-
ganizations that emphasize innovation rather than standardization. 79 Following
these guidelines at the time of hiring should identify new employees who fit
better with the organization’s culture, which should, in turn, result in higher
employee satisfaction and reduced turnover. Research on person–organization
fit has also looked at whether people’s values match the organization’s culture.
This match predicts job satisfaction, commitment to the organization, and low
turnover. 80 Interestingly, some research found that person-organization fit was
more important in predicting turnover in a collectivistic nation (India) than in
a more individualistic nation (the United States). 81
8 Identify Hofstede’s five
value dimensions of national
culture.
One of the most widely referenced approaches for analyzing variations among
cultures was done in the late 1970s by Geert Hofstede. 82 He surveyed more than
116,000 IBM employees in 40 countries about their work-related values and found
that managers and employees vary on five value dimensions of national culture:
● Power distance. Power distance describes the degree to which people in a
country accept that power in institutions and organizations is distributed
unequally. A high rating on power distance means that large inequalities
of power and wealth exist and are tolerated in the culture, as in a class or
caste system that discourages upward mobility. A low power distance rat-
ing characterizes societies that stress equality and opportunity.
● Individualism versus collectivism. Individualism is the degree to which peo-
ple prefer to act as individuals rather than as members of groups and
believe in individual rights above all else. Collectivism emphasizes a tight
social framework in which people expect others in groups of which they
are a part to look after them and protect them.
● Masculinity versus femininity. Hofstede’s construct of masculinity is the
degree to which the culture favors traditional masculine roles such as
achievement, power, and control, as opposed to viewing men and women
as equals. A high masculinity rating indicates the culture has separate roles
International Values
MyManagementLab
For an interactive application of this
topic, check out this chapter’s
simulation activity at
www.mymanagementlab.com.

www.mymanagementlab.com

International Values 151
for men and women, with men dominating the society. A high femininity
rating means the culture sees little differentiation between male and fe-
male roles and treats women as the equals of men in all respects.
● Uncertainty avoidance. The degree to which people in a country pre-
fer structured over unstructured situations defines their uncertainty
avoidance . In cultures that score high on uncertainty avoidance, people
have an increased level of anxiety about uncertainty and ambiguity and
use laws and controls to reduce uncertainty. People in cultures low on
uncertainty avoidance are more accepting of ambiguity, are less rule ori-
ented, take more risks, and more readily accept change.
● Long-term versus short-term orientation. This newest addition to Hofstede’s
typology measures a society’s devotion to traditional values. People in a
culture with long-term orientation look to the future and value thrift, per-
sistence, and tradition. In a short-term orientation , people value the here
and now; they accept change more readily and don’t see commitments as
impediments to change.
How do different countries score on Hofstede’s dimensions? Exhibit 5-7
shows the ratings for the countries for which data are available. For example,
power distance is higher in Malaysia than in any other country. The United
States is very individualistic; in fact, it’s the most individualistic nation of all
(closely followed by Australia and Great Britain). The United States also tends
to be short term in orientation and low in power distance (people in the United
States tend not to accept built-in class differences between people). It is also
relatively low on uncertainty avoidance, meaning most adults are relatively tol-
erant of uncertainty and ambiguity. The United States scores relatively high on
masculinity; most people emphasize traditional gender roles (at least relative to
countries such as Denmark, Finland, Norway, and Sweden).
You’ll notice regional differences. Western and northern nations such as
Canada and the Netherlands tend to be more individualistic. Poorer countries
such as Mexico and the Philippines tend to be higher on power distance. South
American nations tend to be higher than other countries on uncertainty avoid-
ance, and Asian countries tend to have a long-term orientation.
Hofstede’s culture dimensions have been enormously influential on OB re-
searchers and managers. Nevertheless, his research has been criticized. First,
although the data have since been updated, the original work is more than
30 years old and was based on a single company (IBM). A lot has happened on
the world scene since then. Some of the most obvious changes include the fall
of the Soviet Union, the transformation of central and eastern Europe, the end
of apartheid in South Africa, and the rise of China as a global power. Second,
few researchers have read the details of Hofstede’s methodology closely and are
power distance A national culture
attribute that describes the extent to
which a society accepts that power
in institutions and organizations is
distributed unequally.
individualism A national culture
attribute that describes the degree to
which people prefer to act as individuals
rather than as members of groups.
collectivism A national culture attribute
that describes a tight social framework
in which people expect others in groups
of which they are a part to look after
them and protect them.
masculinity A national culture attribute
that describes the extent to which the
culture favors traditional masculine
work roles of achievement, power, and
control. Societal values are characterized
by assertiveness and materialism.
femininity A national culture attribute
that indicates little differentiation
between male and female roles; a high
rating indicates that women are treated
as the equals of men in all aspects of
the society.
uncertainty avoidance A national
culture attribute that describes
the extent to which a society
feels threatened by uncertain and
ambiguous situations and tries to
avoid them.
long-term orientation A national
culture attribute that emphasizes the
future, thrift, and persistence.
short-term orientation A national
culture attribute that emphasizes
the past and present, respect for
tradition, and fulfillment of social
obligations.

Power Distance
Individualism
versus Collectivism
Masculinity
versus Femininity
Uncertainty
Avoidance
Long- versus
Short-Term
Orientation
Country Index Rank Index Rank Index Rank Index Rank Index Rank
Argentina 49 35–36 46 22–23 56 20–21 86 10–15
Australia 36 41 90 2 61 16 51 37 31 22–24
Austria 11 53 55 18 79 2 70 24–25 31 22–24
Belgium 65 20 75 8 54 22 94 5–6 38 18
Brazil 69 14 38 26–27 49 27 76 21–22 65 6
Canada 39 39 80 4–5 52 24 48 41–42 23 30
Chile 63 24–25 23 38 28 46 86 10–15
Colombia 67 17 13 49 64 11–12 80 20
Costa Rica 35 42–44 15 46 21 48–49 86 10–15
Denmark 18 51 74 9 16 50 23 51 46 10
Ecuador 78 8–9 8 52 63 13–14 67 28
El Salvador 66 18–19 19 42 40 40 94 5–6
Finland 33 46 63 17 26 47 59 31–32 41 14
France 68 15–16 71 10–11 43 35–36 86 10–15 39 17
Germany 35 42–44 67 15 66 9–10 65 29 31 22–24
Great Britain 35 42–44 89 3 66 9–10 35 47–48 25 28–29
Greece 60 27–28 35 30 57 18–19 112 1
Guatemala 95 2–3 6 53 37 43 101 3
Hong Kong 68 15–16 25 37 57 18–19 29 49–50 96 2
India 77 10–11 48 21 56 20–21 40 45 61 7
Indonesia 78 8–9 14 47–48 46 30–31 48 41–42
Iran 58 29–30 41 24 43 35–36 59 31–32
Ireland 28 49 70 12 68 7–8 35 47–48 43 13
Israel 13 52 54 19 47 29 81 19
Italy 50 34 76 7 70 4–5 75 23 34 19
Jamaica 45 37 39 25 68 7–8 13 52
Japan 54 33 46 22–23 95 1 92 7 80 4
Korea (South) 60 27–28 18 43 39 41 85 16–17 75 5
Malaysia 104 1 26 36 50 25–26 36 46
Mexico 81 5–6 30 32 69 6 82 18
The Netherlands 38 40 80 4–5 14 51 53 35 44 11–12
New Zealand 22 50 79 6 58 17 49 39–40 30 25–26
Norway 31 47–48 69 13 8 52 50 38 44 11–12
Pakistan 55 32 14 47–48 50 25–26 70 24–25 0 34
Panama 95 2–3 11 51 44 34 86 10–15
Peru 64 21–23 16 45 42 37–38 87 9
Philippines 94 4 32 31 64 11–12 44 44 19 31–32
Portugal 63 24–25 27 33–35 31 45 104 2 30 25–26
Singapore 74 13 20 39–41 48 28 8 53 48 9
South Africa 49 35–36 65 16 63 13–14 49 39–40
Spain 57 31 51 20 42 37–38 86 10–15 19 31–32
Sweden 31 47–48 71 10–11 5 53 29 49–50 33 20
Switzerland 34 45 68 14 70 4–5 58 33 40 15–16
Taiwan 58 29–30 17 44 45 32–33 69 26 87 3
Thailand 64 21–23 20 39–41 34 44 64 30 56 8
Turkey 66 18–19 37 28 45 32–33 85 16–17
United States 40 38 91 1 62 15 46 43 29 27
Uruguay 61 26 36 29 38 42 100 4
Venezuela 81 5–6 12 50 73 3 76 21–22
Yugoslavia 76 12 27 33–35 21 48–49 88 8
Regions:
Arab countries 80 7 38 26–27 53 23 68 27
East Africa 64 21–23 27 33–35 41 39 52 36 25 28–29
West Africa 77 10–11 20 39–41 46 30–31 54 34 16 33
Scores range from 0 5 extremely low on dimension to 100 5 extremely high.
Note: 1 5 highest rank. LTO ranks: 1 5 China; 15–16 5 Bangladesh; 21 5 Poland; 34 5 lowest.
Source: Copyright Geert Hofstede BV, hofstede@bart.nl . Reprinted with permission.
Hofstede’s Cultural Values by Nation Exhibit 5-7
152

International Values 153
therefore unaware of the many decisions and judgment calls he had to make
(for example, reducing the number of cultural values to just five). Some re-
sults are unexpected. Japan, which is often considered a highly collectivist na-
tion, is considered only average on collectivism under Hofstede’s dimensions. 83
Despite these concerns, Hofstede has been one of the most widely cited social
scientists ever, and his framework has left a lasting mark on OB.
Recent research across 598 studies with more than 200,000 respondents has
investigated the relationship of cultural values and a variety of organizational
criteria at both the individual and national level of analysis. 84 Overall, the four
original culture dimensions were equally strong predictors of relevant outcomes,
meaning researchers and practicing managers need to think about culture ho-
listically and not just focus on one or two dimensions. Cultural values were more
strongly related to organizational commitment, citizenship behavior, and team-
related attitudes than were personality scores. On the other hand, personality was
more strongly related to behavioral criteria like performance, absenteeism, and
turnover. The researchers also found that individual scores were much better
predictors of most outcomes than assigning all people in a country the same cul-
tural values. In sum, this research suggests that Hofstede’s value framework may
be a valuable way of thinking about differences among people, but we should be
cautious about assuming all people from a country have the same values.
The GLOBE Framework for Assessing Cultures Begun in 1993, the Global
Leadership and Organizational Behavior Effectiveness (GLOBE) research
program is an ongoing cross-cultural investigation of leadership and national
culture. Using data from 825 organizations in 62 countries, the GLOBE team
identified nine dimensions on which national cultures differ. 85 Some—such
as power distance, individualism/collectivism, uncertainty avoidance, gender
differentiation (similar to masculinity versus femininity), and future orientation
Understanding differences in
values across cultures helps explain
the behavior of employees from
different countries. According to
Hofstede’s framework for assess-
ing cultures, China, like all Asian
nations, ranks high in long-term
orientation. China also ranks high in
power distance, where the inequal-
ity of power and wealth within
the country is accepted by citizens
as part of their cultural heritage.
Ranking low in individualism, China
has a strong collectivist culture that
fosters relationships where every-
one takes responsibility for group
members. Using these and other
ratings can help organizations con-
sidering doing business in China to
predict the behavior of employees
shown here at a glassware factory.
So
ur
ce
: I
m
ag
in
ec
hi
na
v
ia
A
P
Im
ag
es
.

154 CHAPTER 5 Personality and Values
(similar to long-term versus short-term orientation)—resemble the Hofstede
dimensions. The main difference is that the GLOBE framework added dimen-
sions, such as humane orientation (the degree to which a society rewards in-
dividuals for being altruistic, generous, and kind to others) and performance
orientation (the degree to which a society encourages and rewards group mem-
bers for performance improvement and excellence).
Which framework is better? That’s hard to say, and each has its adherents.
We give more emphasis to Hofstede’s dimensions here because they have stood
the test of time and the GLOBE study confirmed them. However, researchers
continue to debate the differences between them, and future studies may favor
the more nuanced perspective of the GLOBE study. 86
MyManagementLab
Now that you have finished this chapter, go back to www.mymanagementlab.com to continue
practicing and applying the concepts you’ve learned.
Personality What value, if any, does the Big Five model provide to managers?
From the early 1900s through the mid-1980s, researchers sought a link between
personality and job performance. “The outcome of those 80-plus years of re-
search was that personality and job performance were not meaningfully related
across traits or situations.” 87 However, the past 20 years have been more promis-
ing, largely due to the findings about the Big Five.
● Screening job candidates for high conscientiousness—as well as the other
Big Five traits, depending on the criteria an organization finds most
important—should pay dividends. Of course, managers still need to take
situational factors into consideration. 88
● Factors such as job demands, the degree of required interaction with
others, and the organization’s culture are examples of situational variables
that moderate the personality–job performance relationship.
● You need to evaluate the job, the work group, and the organization to
determine the optimal personality fit.
● Other traits, such as core self-evaluation or narcissism, may be relevant in
certain situations, too.
● Although the MBTI has been widely criticized, it may have a place in
organizations. In training and development, it can help employees better
understand themselves, help team members better understand each other,
and open up communication in work groups and possibly reduce conflicts.
Values Why is it important to know an individual’s values? Values often un-
derlie and explain attitudes, behaviors, and perceptions. So knowledge of an
individual’s value system can provide insight into what makes the person “tick.”
● Employees’ performance and satisfaction are likely to be higher if their val-
ues fit well with the organization. The person who places great importance
on imagination, independence, and freedom is likely to be poorly matched
with an organization that seeks conformity from its employees.
Summary and Implications for Managers

www.mymanagementlab.com

Summary and Implications for Managers 155
Millennials Are More Narcissistic
POINT COUNTERPOINT
S
peaking of music, this argument is like a broken record
that seems to play over and over: “THE YOUTH OF
TODAY ARE LOST!” Every generation tends to think the
new generation is without values, and the new generation
thinks the older generation is hopelessly judgmental and out
of touch. Wasn’t the “Me generation” supposedly a genera-
tion ago? Let’s send the broken record to the recycling bin and
review the evidence.
One recent study that tracked nearly half a million young
people on measures of egotistic traits such as self-perceived
intelligence, self-esteem, and self-enhancement found
little evidence to suggest changes since the 1970s. In short,
Millennials aren’t any more narcissistic than young people
were in the 1970s or 1980s. The authors of this study conclude,
“Today’s youth seem no more egotistical than previous
generations . . . In fact, today’s youth seem to have psycho-
logical profiles that are remarkably similar to youth from the
past 30 years.”
Another study offered an interesting explanation for why
people think Millennials are more narcissistic. Specifically, young
people in general are more self-focused, but as people age,
they become more “other” focused. So we think young people
are different when in fact they’re just the way older folks were
when they were younger. As these authors conclude, “Every
generation is Generation Me.” Our level of narcissism appears to
be one of the many things that change as we get older.
More broadly, narcissistic folks exist in every generation.
We need to be careful when generalizing about entire groups
(whether one sex, one race, one culture, or one generation).
While generalizations have caused no small amount of trouble,
we still like to simplify the world, sometimes for good reason.
In this case, however, the good reason isn’t there, especially
considering the latest evidence.
T
hose in college today have many good qualities: they are
more technologically savvy, more socially tolerant, and
more balanced in their work and family priorities than
previous generations. Thus, those poised to enter the workforce
today do so with some important virtues. Humility, however, is
not one of them.
A large-scale, longitudinal study found that those graduating
from college in 2010 were more likely than those from previous
generations to have seemingly inflated views of themselves.
The 2010 graduates were more likely than 1980 graduates to
agree they would be “very good” spouses (56 percent of 2010
graduates, compared to 37 percent among 1980 graduates),
parents (54 percent of 2010 graduates, 36 percent among 1980
graduates), and workers (65 percent of 2010 graduates, 49 per-
cent among 1980 graduates).
Studies measuring narcissism suggests that scores are ris-
ing, especially among younger generations. For example, by
presenting a choice between two statements—“I try not to be a
show-off” versus “I will usually show off if I get the chance”—
psychologists have found that narcissism has been growing
since the early 1980s.
A 2011 study by University of Kentucky researcher Dr. Nathan
DeWall even found that popular songs are becoming more
narcissistic. Analyzing the lyrics of songs on the Billboard Hot
100 Chart from 1980 to 2007, DeWall found a clear trend toward
narcissism. The words “I” and “me” have replaced “we” and
“us.” Two recent examples: “I’m bringing sexy back. Yeah. Them
other boys don’t know how to act. Yeah” (Justin Timberlake), and
“I am the greatest man that ever lived. I was born to give and give
and give” (Weezer).
Narcissism’s rise is all around us. The sooner we admit it,
the sooner we can begin to address the problem in families, in
education, and at work.
Sources: N. Wolchover, “Song Lyrics Suggest Narcissism Is on the Rise,” LiveScience (April, 26, 2011), downloaded May 16,
2011, from www.livescience.com ; M. Norris, “Study: Narcissism on Rise in Pop Lyrics,” All Things Considered (April 26, 2011),
downloaded May 15 from www.npr.org/ ; K. H. Trzesniewski and M. B. Donnellan, “Rethinking ‘Generation Me’: A Study
of Cohort Effects from 1976–2006,” Perspectives on Psychological Science 5, no. 1 (2010), pp. 58–75; and B. W. Roberts,
G. Edmonds, and E. Grijalva, “It Is Developmental Me, Not Generation Me: Developmental Changes Are More Important Than
Generational Changes in Narcissism—Comment on Trzesniewski & Donnellon (2010),” Perspectives on Psychological Science
5, No. 1 (2010), pp. 97–102.

www.livescience.com

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156 CHAPTER 5 Personality and Values
● Managers are more likely to appreciate, evaluate positively, and allocate
rewards to employees who fit in, and employees are more likely to be sat-
isfied if they perceive they do fit in. This argues for management to seek
job candidates who have not only the ability, experience, and motivation
to perform but also a value system compatible with the organization’s.
1 What is personality? How do we typically measure it?
What factors determine personality?
2 What is the Myers-Briggs Type Indicator (MBTI), and
what does it measure?
3 What are the Big Five personality traits?
4 How do the Big Five traits predict work behavior?
5 Besides the Big Five, what other personality traits are
relevant to OB?
6 What are values, why are they important, and what is
the difference between terminal and instrumental values?
7 Do values differ across generations? How so?
8 Do values differ across cultures? How so?
QUESTIONS FOR REVIEW
EXPERIENTIAL EXERCISE What Organizational Culture Do You Prefer?
The Organizational Culture Profile (OCP) can help assess
whether an individual’s values match the organization’s. 89
The OCP helps individuals sort their characteristics in
terms of importance, which indicates what a person
values.
1. Working on your own, complete the OCP found at
www.jstor.org/stable/256404 .
2. Your instructor may ask you the following questions
individually or as a group of three or four students
(with a spokesperson appointed to speak to the class
for each group):
a. What were your most preferred and least preferred
values? Do you think your most preferred and least
preferred values are similar to those of other class
or group members?
b. Do you think there are generational differences in
the most preferred and least preferred values?
c. Research has shown that individuals tend to be
happier, and perform better, when their OCP
values match those of their employer. How impor-
tant do you think a “values match” is when you’re
deciding where you want to work?
ETHICAL DILEMMA Freedom or Lack of Commitment?
Lifelong commitment to one employer is a thing of the
past. An analysis by Princeton economist Henry Farber
revealed that the percentage of private-sector employees
who remained with the same employer for 10 or more
years has dropped from 50 percent in 1973 to less than
35 percent today. Those with 20 or more years with the
same employer dropped from 35 percent to 20 percent.
To be sure, some of this movement is employer-driven.
Lifetime job security is long gone for most positions. So are
benefit packages that would keep employees secure, such as
rock-solid pensions and generous health benefits. But does
a generational shift in values also explain the drop?
According to Pew Research, 66 percent of Millennials
say they want to switch careers some time in their life,
while 62 percent of Generation X members and 84 per-
cent of Baby Boomers say they would prefer to stay at their
current job for the rest of their lives. Another study sug-
gested that while 64 percent of Baby Boomers “really care
about the fate” of their organization, this figure is only
47 percent for Millennials. Yet another study indicated
that two-thirds of Millennials had plans to move or “surf”
from one job to another as a means of gaining desired
skills and increasing their pay.
One Millennial, Rebecca Thorman, notes that mobility
makes sense only because if you aren’t mobile, you limit
your options. She says you can’t expect your pay to grow
“by staying at the same job . . . You just can’t.”

www.jstor.org/stable/256404

Case Incident 1 157
These values don’t sit well with some employers. “We
prefer long tenured employees who have stuck with us
and been loyal,” says Dave Foster, CEO of AvreaFoster,
an advertising agency in Dallas. “It appears that a lot of
Millennials don’t think that one path is the answer. This is
a problem because the commitment isn’t there.”
To attitudes like that, Thorman retorts, “We’re not
going to settle.”
Questions
1. In your experience, do younger individuals differ
from older individuals in their plans to remain with
one employer for a long time? Do you think these
differences, if you believe they exist, are due to shift-
ing economic realities or to changing work values?
2. Do you think you should feel free to “job surf”—
purposely moving from job to job as soon as the desire
strikes? Do you think employers have a right to ask
about “job surfing” plans when they interview you?
3. If you had an interview with Foster or someone with
his views of Millennials, how might you combat his
preconceptions?
Sources: S. Collins, “Millennials Take on the Workforce,” SHIFT Magazine (May 3, 2011), downloaded
May 12, 2011, from www.smudailymustang.com ; and R. Wartzman, “Generation Mobility,” Los Angeles
Times (July 16, 2010), downloaded May 12, 2011, from www.dailytidings.com/ .
CASE INCIDENT 1 Is There a Price for Being Too Nice?
Agreeable people tend to be kinder and more accommo-
dating in social situations, which you might think could
add to their success in life. However, we’ve already noted
that one downside of agreeableness is potentially lower
earnings. We’re not sure why this is so, but agreeable indi-
viduals may be less aggressive in negotiating starting sala-
ries and pay raises.
Yet there is clear evidence that agreeableness is some-
thing employers value. Several recent books argue in fa-
vor of “leading with kindness” (Baker & O’Malley, 2008)
and “capitalizing on kindness” (Tillquist, 2008). Other
articles in the business press have argued that the sensi-
tive, agreeable CEO—such as GE’s Jeffrey Immelt and
Boeing’s James McNerney—signals a shift in business cul-
ture (Brady, 2007). In many circles, individuals desiring
success in their careers are exhorted to be “complimen-
tary,” “kind,” and “good” (for example, Schillinger, 2007).
Take the example of 500-employee Lindblad
Expeditions. It emphasizes agreeableness in its hiring deci-
sions. The VP of HR commented, “You can teach people
any technical skill, but you can’t teach them how to be a
kindhearted, generous-minded person with an open spirit.”
So, while employers want agreeable employees, agree-
able employees are not better job performers, and they
are less successful in their careers. We might explain this
apparent contradiction by noting that employers value
agreeable employees for other reasons: they are more
pleasant to be around, and they may help others in ways
that aren’t reflected in their job performance. Most evi-
dence suggests that agreeable people like agreeable peo-
ple, which you might expect because people like those
who are similar to themselves. However, even disagree-
able people like agreeable people, perhaps because they
are easier to manipulate than individuals who are lower in
agreeableness. Perhaps everyone wants to hire agreeable
people just because everyone likes to be around them.
Moreover, a 2008 study of CEO and CEO candidates
revealed that this contradiction applies to organizational
leaders as well. Using ratings made by an executive search
firm, researchers studied the personalities and abilities
of 316 CEO candidates for companies involved in buyout
and venture capital transactions. They found that what
gets a CEO candidate hired is not what makes him or her
effective. Specifically, CEO candidates who were rated
high on “nice” traits such as respecting others, develop-
ing others, and teamwork were more likely to be hired.
However, these same characteristics—especially teamwork
and respecting others for venture capital CEOs—made
the organizations they led less successful.

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158 CHAPTER 5 Personality and Values
agreeableness is an important virtue? And in which it
is harmful?
3. In some research we’ve conducted, we’ve found that
the negative effects of agreeableness on earnings
is stronger for men than for women (that is, being
agreeable hurt men’s earnings more than women’s).
Why do you think this might be the case?
Questions
1. Do you think there is a contradiction between what
employers want in employees (agreeable employees)
and what employees actually do best (disagreeable
employees)? Why or why not?
2. Often, the effects of personality depend on the situ-
ation. Can you think of some job situations in which
Sources: A. M. Grant, F. Gino, and D. A. Hofman, “The Hidden Advantages of Quiet Bosses,” Harvard
Business Review (December 2010), p. 28; B. O’Keefe and D. Burke, “Meet the CEO of the Biggest
Company on Earth,” Fortune (September 27, 2010), pp. 80–94; and J. S. Lubin, “Introverted Execs Find
Ways to Shine,” The Wall Street Journal (April 14, 2011), online.wsj.com .
CASE INCIDENT 2 Leadership from an Introvert’s Perspective
When people think of a stereotypical leader, they often
conjure up the image of a dynamic public speaker, a force-
ful and dominant personality, and someone who can cul-
tivate relationships with a broad number of people. These
are all hallmarks of the extroverted personality type, so it’s
often been the case that extroverts rise to leadership posi-
tions more readily than introverts.
However, some question whether the social dominance
and ability to command attention shown by extraverts
might make them less effective leaders in certain ways.
In particular, extroverts may be less likely to take advice
from followers. One study investigated how quickly groups
of college students could fold shirts in 10 minutes. Each
group had a leader who was cued to be either extroverted
or introverted. The introverted leaders took more advice
from their proactive followers, and this led the groups
with introverted leaders to be more effective. Thus, even
though there are cases where introverts are less success-
ful as leaders, in some conditions they are more effective.
Others note that introverted leaders can be better than
extroverts at one-on-one interactions, empathy, and delib-
erate decision making.
Are there business executives who break the extroverted
leader mold? One is Google co-founder Larry Page, well-
known for developing a small number of close relation-
ships and being an excellent listener. Colgate-Palmolive
chief Ian Cook might feel uncomfortable in front of large
groups of people he doesn’t know, but he has learned to
partner with more extroverted colleagues for presenta-
tions to offset his natural shyness. Wal-Mart Stores CEO
Mike Duke is famously low-key and reserved, but he has
utilized his natural introvert skills of managing details and
engineering solutions to maintain the retail giant’s domi-
nant market position. These examples show that although
extroverts might get all the attention, introverts can still
make effective leaders.
Questions
1. Are you more of an introverted or extraverted leader?
What can you do to leverage your personality to be a
more effective leader?
2. Under what conditions do you think extraverts make
more effective leaders than introverts? What unique
abilities of introverts could make them more effective
in some situations?
3. The case describes some problems introverts might
have in leadership situations. What techniques might
they employ to help them overcome these?
4. What types of developmental experiences do you
think would be especially valuable for introverted
leaders?
Sources: T. A. Judge, B. A. Livingston, and C. Hurst, “Do Nice Guys—and Gals—Really Finish Last? The
Joint Effects of Sex and Agreeableness on Earnings,” working paper, University of Florida (2009); S. N.
Kaplan, M. M. Klebanov, and M. Sorensen, “Which CEO Characteristics and Abilities Matter?” work-
ing paper, University of Chicago Graduate School of Business (2008), faculty.chicagobooth.edu/steven
.kaplan/research/kks ; W. F. Baker and M. O’Malley, Leading with Kindness: How Good People
Consistently Get Superior Results (New York: AMACOM, 2008); K. Tillquist, Capitalizing on Kindness: When
21st Century Professionals Need to Be Nice (Pompton Plains, NJ: Career Press, 2008); D. Brady, “Being Mean
Is So Last Millennium,” BusinessWeek (January 15, 2007), p. 61; and L. Schillinger, “Nice and Ambitious:
Either, Neither, or Both?” The New York Times (January 14, 2007), p. 1.

Endnotes 159
ENDNOTES
1. G. W. Allport, Personality: A Psychological Interpretation (New
York: Holt, Rinehart & Winston, 1937), p. 48. For a brief
critique of current views on the meaning of personal-
ity, see R. T. Hogan and B. W. Roberts, “Introduction:
Personality and Industrial and Organizational Psychology,”
in B. W. Roberts and R. Hogan (eds.), Personality Psychology
in the Workplace (Washington, DC: American Psychological
Association, 2001), pp. 11–12.
2. K. I. van der Zee, J. N. Zaal, and J. Piekstra, “Validation of
the Multicultural Personality Questionnaire in the Context
of Personnel Selection,” European Journal of Personality 17,
Supl. 1 (2003), pp. S77–S100.
3. S. A. Birkeland, T. M. Manson, J. L. Kisamore, M. T. Brannick,
and M. A. Smith, “A Meta-Analytic Investigation of Job
Applicant Faking on Personality Measures,” International Journal
of Selection and Assessment 14, no. 14 (2006), pp. 317–335.
4. T. A. Judge, C. A. Higgins, C. J. Thoresen, and M. R. Barrick,
“The Big Five Personality Traits, General Mental Ability, and
Career Success Across the Life Span,” Personnel Psychology 52,
no. 3 (1999), pp. 621–652; I. Oh, G. Wang, and M. K. Mount,
“Validity of Observer Ratings of the Five-Factor Model
of Personality Traits: A Meta-Analysis,” Journal of Applied
Psychology 96, No. 4 (2011), pp. 762-773.
5. See R. Illies, R. D. Arvey, and T. J. Bouchard, “Darwinism,
Behavioral Genetics, and Organizational Behavior: A Review
and Agenda for Future Research,” Journal of Organizational
Behavior 27, no. 2 (2006), pp. 121–141; and W. Johnson,
E. Turkheimer, I. I. Gottesman, and T. J. Bouchard, Jr.,
“Beyond Heritability: Twin Studies in Behavioral Research,”
Current Directions in Psychological Science 18, no. 4 (2009),
pp. 217–220.
6. S. Srivastava, O. P. John, and S. D. Gosling, “Development
of Personality in Early and Middle Adulthood: Set Like
Plaster or Persistent Change?” Journal of Personality and Social
Psychology 84, no. 5 (2003), pp. 1041–1053; and B. W. Roberts,
K. E. Walton, and W. Viechtbauer, “Patterns of Mean-Level
Change in Personality Traits Across the Life Course: A Meta-
Analysis of Longitudinal Studies,” Psychological Bulletin 132,
no. 1 (2006), pp. 1–25.
7. S. E. Hampson and L. R. Goldberg, “A First Large Cohort
Study of Personality Trait Stability Over the 40 Years Between
Elementary School and Midlife,” Journal of Personality and
Social Psychology 91, no. 4 (2006), pp. 763–779.
8. See A. H. Buss, “Personality as Traits,” American Psychologist
44, no. 11 (1989), pp. 1378–1388; R. R. McCrae, “Trait
Psychology and the Revival of Personality and Culture
Studies,” American Behavioral Scientist 44, no. 1 (2000),
pp. 10–31; and L. R. James and M. D. Mazerolle, Personality
in Work Organizations (Thousand Oaks, CA: Sage, 2002).
9. See, for instance, G. W. Allport and H. S. Odbert, “Trait
Names, A Psycholexical Study,” Psychological Monographs,
no. 47 (1936); and R. B. Cattell, “Personality Pinned Down,”
Psychology Today (July 1973), pp. 40–46.
10. R. B. Kennedy and D. A. Kennedy, “Using the Myers-Briggs
Type Indicator in Career Counseling,” Journal of Employment
Counseling 41 , no. 1 (2004), pp. 38–44.
11. See, for instance, D. J. Pittenger, “Cautionary Comments
Regarding the Myers-Briggs Type Indicator,” Consulting
Psychology Journal: Practice and Research 57, no. 3 (2005),
pp. 10–221; L. Bess and R. J. Harvey, “Bimodal Score
Distributions and the Myers-Briggs Type Indicator: Fact
or Artifact?” Journal of Personality Assessment 78 , no. 1
(2002), pp. 176–186; R. M. Capraro and M. M. Capraro,
“Myers-Briggs Type Indicator Score Reliability Across
Studies: A Meta-Analytic Reliability Generalization Study,”
Educational & Psychological Measurement 62 , no. 4 (2002),
pp. 590–602; and R. C. Arnau, B. A. Green, D. H. Rosen, D.
H. Gleaves, and J. G. Melancon, “Are Jungian Preferences
Really Categorical? An Empirical Investigation Using
Taxometric Analysis,” Personality & Individual Differences 34 ,
no. 2 (2003), pp. 233–251.
12. See, for example, I. Oh, G. Wang, and M. K. Mount,
“Validity of Observer Ratings of the Five-Factor Model
of Personality Traits: A Meta-Analysis,” Journal of Applied
Psychology 96, No. 4 (2011), pp. 762–773; and M. R. Barrick
and M. K. Mount, “Yes, Personality Matters: Moving On
to More Important Matters,” Human Performance 18, no. 4
(2005), pp. 359–372.
13. W. Fleeson and P. Gallagher, “The Implications of Big Five
Standing for the Distribution of Trait Manifestation in
Behavior: Fifteen Experience-Sampling Studies and a Meta-
Analysis,” Journal of Personality and Social Psychology 97 , no. 6
(2009), pp. 1097–1114.
14. See, for instance, I. Oh and C. M. Berry, “The Five-Factor
Model of Personality and Managerial Performance: Validity
Gains Through the Use of 360 Degree Performance
Ratings,” Journal of Applied Psychology 94, no. 6 (2009),
pp. 1498–1513; G. M. Hurtz and J. J. Donovan, “Personality
and Job Performance: The Big Five Revisited,” Journal of
Applied Psychology 85, no. 6 (2000), pp. 869–879; J. Hogan
and B. Holland, “Using Theory to Evaluate Personality and
Job-Performance Relations: A Socioanalytic Perspective,”
Journal of Applied Psychology 88, no. 1 (2003), pp. 100–112; and
M. R. Barrick and M. K. Mount, “Select on Conscientiousness
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“Too Much of a Good Thing: Curvilinear Relationships

160 CHAPTER 5 Personality and Values
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www.maccoby.com/Articles/NarLeaders.shtml

Endnotes 161
41. T. A. Judge, J. A. LePine, and B. L. Rich, “The Narcissistic
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59. M. A. Korsgaard, B. M. Meglino, S. W. Lester, and S. S. Jeong,
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60. Grant and Wrzesniewski, “I Won’t Let You Down . . .
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61. M. Rokeach, The Nature of Human Values (New York: The
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62. M. Rokeach and S. J. Ball-Rokeach, “Stability and
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pp. 913–929.

www.theatlanticwire.com

162 CHAPTER 5 Personality and Values
63. S. Roccas, L. Sagiv, S. H. Schwartz, and A. Knafo, “The
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64. See, for instance, B. M. Meglino and E. C. Ravlin, “Individual
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and Research,” Journal of Management 24, no. 3
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65. Rokeach, The Nature of Human Values, p. 6.
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67. Frederick and Weber, “The Values of Corporate Managers
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68. Ibid., p. 132.
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74. J. L. Holland, Making Vocational Choices: A Theory of Vocational
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77. S. A. Woods and S. E. Hampson, “Predicting Adult
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79. Based on T. A. Judge and D. M. Cable, “Applicant Personality,
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Endnotes 163
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DO MACHINES MAKE BETTER DECISIONS?
164
H
edge fund managers are unlike other people in ways that are fairly
obvious. Typically, they are unusually quantitatively oriented and
not made uncomfortable with the thought of losing thousands or
even millions of dollars on a bet gone bad. Their careers may rise or fall based
on factors over which they have little control.
Even in this unusual group, Spencer Greenberg is unusual. Only 27, he is
chief executive and co-chair of a Manhattan investment firm. After graduat-
ing from Columbia Business School, Greenberg founded Rebellion Research
Technologies with two other recent Amherst College graduates (Alexander
Fleiss and Jonathan Sturges) and another partner (Jeremy Newton) who was
still in college. Greenberg and his compatriots are, of course, very young to
be leading a New York investment firm. What is even more interesting is the
way they’re doing it.
All investment bankers and hedge fund managers are comfortable with
analytics. What makes Rebellion unusual is the degree to which the firm has
taken them. The firm uses computers to actually make buy, sell, or hold de-
cisions and to learn from its mistakes. “It’s pretty clear that human beings
aren’t improving,” says Greenberg. “But computers and algorithms are only
getting more robust.”
Based on the returns Rebellion has been able to generate, other com-
panies, including Cerebellum Capital and RGM Advisors, have followed
suit. The computers outperform humans, their advocates say, because
they can crunch numbers more quickly, “learn” what works, and adapt
more readily and objectively. Rebellion’s program analyzes more than
a decade of financial activity and the latest market results to evaluate
stocks. When buy, sell, or hold decisions stop working, the computer ad-
justs by automatically incorporating new information. Rebellion’s leaders
have faith in their artificial intelligence (AI). “I’ve learned not to question
the AI,” says Fleiss.
Machines are not only taking over financial decision making. From
flying airplanes to making medical decisions to running nuclear power
plants, computers are gradually supplanting and even replacing human
judgment.
Not everyone is convinced that AI always improves on human judg-
ment and decision making. Some argue that reliance on computers makes
complex systems more susceptible to errors because no computer can antic-
ipate every scenario, and humans function less well as the passive monitors
LEARNING
OBJECTIVES
After studying this chapter,
you should be able to:
1 Define perception and
explain the factors that
influence it.
2 Explain attribution
theory and list the three
determinants of attribution.
3 Identify the shortcuts
individuals use in making
judgments about others.
4 Explain the link between
perception and decision
making.
5 Apply the rational model
of decision making and
contrast it with bounded
rationality and intuition.
6 List and explain the common
decision biases or errors.
7 Explain how individual
differences and organiza-
tional constraints affect
decision making.
8 Contrast the three ethical
decision criteria.
9 Define creativity and discuss
the three-component
model of creativity.
MyManagementLab
Access a host of interactive
learning aids to help strengthen
your understanding of the
chapter concepts at
www.mymanagementlab.com.

www.mymanagementlab.com

Perception
and Individual
Decision Making 6
Indecision may or may not
be my problem.
—Jimmy Buffett
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166 CHAPTER 6 Perception and Individual Decision Making
S A L
SELF-ASSESSMENT LIBRARY
into which AI makes them. Says an observer of one complex system—airline
piloting, “When the person has no role in the task, there’s a much greater risk of
complacency.”
Sources: A. Shell, “Wall Street Traders Mine Tweets to Gain a Trading Edge,” USA Today (May 4,
2011), downloaded May 23, 2011, from www.usatoday.com/money/ ; “Soon, Your Computer Will
Have Emotions Like You,” The Economic Times (April 20, 2011), downloaded May 23, 2011, from
http://articles.economictimes.indiatimes.com ; S. Patterson, “Letting the Machines Decide,” The
Wall Street Journal (July 14, 2010), p. C1; and C. Negroni, “As Attention Wanders, Second Thoughts
About the Autopilot,” The New York Times (May 18, 2010), pp. B1, B5.
T he preceding example illustrates some of the issues that arise when people look for techniques to improve their decision making. One reason some like computerized decision making is that human decision makers can be
incorrect or biased in many ways. This chapter will review some of these biases
in human decision making, but it also explores how human decision makers
can outperform machines, especially in the area of creativity. The Case Incident 1
(at the end of the chapter) considers computerized decision making further.
In the following Self-Assessment Library, consider one perception—that of
appropriate gender roles.
What Are My Gender Role Perceptions?
In the Self-Assessment Library (available on CD or online), take assessment IV.C.2
(What Are My Gender Role Perceptions?) and answer the following questions.
1. Did you score as high as you thought you would?
2. Do you think a problem with measures like this is that people aren’t honest
in responding?
3. If others, such as friends, classmates, and family members, rated you, would
they rate you differently? Why or why not?
4. Research has shown that people’s gender role perceptions are becoming less
traditional over time. Why do you suppose this is so?
Perception is a process by which individuals organize and interpret their
sensory impressions in order to give meaning to their environment. However,
what we perceive can be substantially different from objective reality. For
example, all employees in a firm may view it as a great place to work—favorable
working conditions, interesting job assignments, good pay, excellent benefits,
understanding and responsible management—but, as most of us know, it’s very
unusual to find such agreement.
Why is perception important in the study of OB? Simply because people’s
behavior is based on their perception of what reality is, not on reality itself. The
world as it is perceived is the world that is behaviorally important.
1 Define perception and
explain the factors that
influence it.
What Is Perception?

www.usatoday.com/money/

http://articles.economictimes.indiatimes.com

What Is Perception? 167
Factors That Influence Perception
How do we explain the fact that individuals may look at the same thing yet
perceive it differently? A number of factors operate to shape and sometimes
distort perception. These factors can reside in the perceiver; in the object, or
target, being perceived; or in the context of the situation in which the perception
is made (see Exhibit 6-1 ).
When you look at a target and attempt to interpret what you see, your
interpretation is heavily influenced by your personal characteristics—your at-
titudes, personality, motives, interests, past experiences, and expectations. For
instance, if you expect police officers to be authoritative or young people to be
lazy, you may perceive them as such, regardless of their actual traits.
Characteristics of the target also affect what we perceive. Loud people are more
likely to be noticed in a group than quiet ones. So, too, are extremely attractive or
unattractive individuals. Because we don’t look at targets in isolation, the relation-
ship of a target to its background also influences perception, as does our tendency
to group close things and similar things together. We often perceive women, men,
Whites, African Americans, Asians, or members of any other group that has clearly
distinguishable characteristics as alike in other, unrelated ways as well.
Context matters too. The time at which we see an object or event can influ-
ence our attention, as can location, light, heat, or any number of situational
factors. At a nightclub on Saturday night, you may not notice a young guest
“dressed to the nines.” Yet that same person so attired for your Monday morn-
ing management class would certainly catch your attention (and that of the
rest of the class). Neither the perceiver nor the target has changed between
Saturday night and Monday morning, but the situation is different.
perception A process by which
individuals organize and interpret their
sensory impressions in order to give
meaning to their environment.
Factors That Influence Perception Exhibit 6-1
Perception
• Attitudes
• Motives
• Interests
• Experience
• Expectations
Factors in the perceiver
Factors in the target
• Novelty
• Motion
• Sounds
• Size
• Background
• Proximity
• Similarity
Factors in the situation
• Time
• Work setting
• Social setting

168 CHAPTER 6 Perception and Individual Decision Making
Now we turn to the application of perception concepts most relevant to
OB— person perception, or the perceptions people form about each other.
Attribution Theory
Nonliving objects such as desks, machines, and buildings are subject to the laws
of nature, but they have no beliefs, motives, or intentions. People do. That’s why
when we observe people, we attempt to explain why they behave in certain ways.
Our perception and judgment of a person’s actions, therefore, will be significantly
influenced by the assumptions we make about that person’s internal state.
Attribution theory tries to explain the ways in which we judge people
differently, depending on the meaning we attribute to a given behavior. 1 It
suggests that when we observe an individual’s behavior, we attempt to deter-
mine whether it was internally or externally caused. That determination, how-
ever, depends largely on three factors: (1) distinctiveness, (2) consensus, and
(3) consistency. First, let’s clarify the differences between internal and external
causation, and then we’ll elaborate on each of the three determining factors.
Internally caused behaviors are those we believe to be under the personal
control of the individual. Externally caused behavior is what we imagine the situ-
ation forced the individual to do. If one of your employees is late for work, you
might attribute that to his partying into the wee hours and then oversleeping.
This is an internal attribution. But if you attribute lateness to an automobile
accident that tied up traffic, you are making an external attribution.
Now let’s discuss the three determining factors. Distinctiveness refers to
whether an individual displays different behaviors in different situations. Is the
employee who arrives late today also one who regularly “blows off” commit-
ments? What we want to know is whether this behavior is unusual. If it is, we
are likely to give it an external attribution. If it’s not, we will probably judge the
behavior to be internal.
If everyone who faces a similar situation responds in the same way, we can
say the behavior shows consensus. The behavior of our tardy employee meets this
criterion if all employees who took the same route were also late. From an at-
tribution perspective, if consensus is high, you would probably give an external
attribution to the employee’s tardiness, whereas if other employees who took
the same route made it to work on time, you would attribute his lateness to an
internal cause.
Finally, an observer looks for consistency in a person’s actions. Does the
person respond the same way over time? Coming in 10 minutes late for work
is not perceived in the same way for an employee who hasn’t been late for
several months as it is for an employee who is late two or three times a week.
The more consistent the behavior, the more we are inclined to attribute it to
internal causes.
Exhibit 6-2 summarizes the key elements in attribution theory. It tells us,
for instance, that if an employee, Kim Randolph, generally performs at about
the same level on related tasks as she does on her current task (low distinc-
tiveness), other employees frequently perform differently—better or worse—
than Kim on that task (low consensus), and Kim’s performance on this current
task is consistent over time (high consistency), anyone judging Kim’s work
will likely hold her primarily responsible for her task performance (internal
attribution).
2 Explain attribution theory
and list the three determi-
nants of attribution.
Person Perception: Making Judgments About Others

Person Perception: Making Judgments About Others 169
One of the most interesting findings from attribution theory research is that
errors or biases distort attributions. When we make judgments about the behav-
ior of other people, we tend to underestimate the influence of external factors
and overestimate the influence of internal or personal factors. 2 This fundamental
attribution error can explain why a sales manager is prone to attribute the poor
performance of her sales agents to laziness rather than to the innovative prod-
uct line introduced by a competitor. Individuals and organizations also tend
to attribute their own successes to internal factors such as ability or effort, while
blaming failure on external factors such as bad luck or unproductive co-workers.
People also tend to attribute ambiguous information as relatively flattering and
accept positive feedback while rejecting negative feedback. This is the self-serving
bias . 3 A U.S. News & World Report study showed its power. Researchers asked one
group of people “If someone sues you and you win the case, should he pay your
legal costs?” Eighty-five percent responded “yes.” Another group was asked “If
you sue someone and lose the case, should you pay his costs?” Only 44 percent
answered “yes.” 4
The evidence on cultural differences in perception is mixed, but most sug-
gest there are differences across cultures in the attributions people make. 5
One study found Korean managers less likely to use the self-serving bias—they
tended to accept responsibility for group failure “because I was not a capable
leader” instead of attributing failure to group members. 6 On the other hand,
Asian managers are more likely to blame institutions or whole organizations,
whereas Western observers believe individual managers should get blame or
praise. 7 That probably explains why U.S. newspapers prominently report the
names of individual executives when firms do poorly, whereas Asian media
cover how the firm as a whole has failed. This tendency to make group-based
attributions also explains why individuals from Asian cultures are more likely to
make group-based stereotypes. 8 Attribution theory was developed largely based
attribution theory An attempt to
determine whether an individual’s
behavior is internally or externally
caused.
fundamental attribution error The
tendency to underestimate the
influence of external factors and
overestimate the influence of internal
factors when making judgments about
the behavior of others.
self-serving bias The tendency for
individuals to attribute their own
successes to internal factors and put
the blame for failures on external
factors.
Attribution Theory Exhibit 6-2
Individual behavior
External
Internal
External
Internal
Internal
External
Distinctiveness
Observation
Attribution
of cause
High
Low
High
Low
High
Low
Interpretation
Consistency
Consensus

170 CHAPTER 6 Perception and Individual Decision Making
on experiments with U.S. and Western European workers. But these studies
suggest caution in making attribution theory predictions in non-Western
societies, especially in countries with strong collectivist traditions.
Differences in attribution tendencies don’t mean the basic concepts of
attribution and blame completely differ across cultures, though. Self-serving
biases may be less common in East Asian cultures, but evidence suggests they
still operate across cultures. 9 Recent studies indicate Chinese managers assess
blame for mistakes using the same distinctiveness, consensus, and consistency
cues Western managers use. 10 They also become angry and punish those
deemed responsible for failure, a reaction shown in many studies of Western
managers. This means the basic process of attribution applies across cultures,
but that it takes more evidence for Asian managers to conclude someone else
should be blamed.
Common Shortcuts in Judging Others
The shortcuts we use in judging others are frequently valuable: they allow us to
make accurate perceptions rapidly and provide valid data for making predic-
tions. However, they are not foolproof. They can and do get us into trouble
when they result in significant distortions.
Selective Perception Any characteristic that makes a person, an object, or an
event stand out will increase the probability we will perceive it. Why? Because it
is impossible for us to assimilate everything we see; we can take in only certain
stimuli. This explains why you’re more likely to notice cars like your own, or why a
boss may reprimand some people and not others doing the same thing. Because
we can’t observe everything going on about us, we engage in selective perception .
A classic example shows how vested interests can significantly influence which
problems we see.
Dearborn and Simon asked 23 business executives (6 in sales, 5 in production,
4 in accounting, and 8 in miscellaneous functions) to read a comprehensive case
describing the organization and activities of a steel company. 11 Each manager
was asked to write down the most important problem in the case. Eighty-three
percent of the sales executives rated sales important; only 29 percent of the oth-
ers did so. The researchers concluded that participants perceived as important
the aspects of a situation specifically related to their own unit’s activities and
goals. A group’s perception of organizational activities is selectively altered to
align with the vested interests the group represents.
Because we cannot assimilate all that we observe, we take in bits and pieces.
But we don’t choose randomly; rather, we select according to our interests, back-
ground, experience, and attitudes. Selective perception allows us to speed-read
others, but not without the risk of drawing an inaccurate picture. Seeing what we
want to see, we can draw unwarranted conclusions from an ambiguous situation.
We find another example of selective perception in financial analysis. From
2007 to 2009, the U.S. stock market lost roughly half its value. Yet during that
time, analysts’ sell ratings (typically, analysts rate a company’s stock with three
recommendations: buy, sell, or hold) actually decreased slightly. Although there
are several reasons analysts are reluctant to put sell ratings on stocks, one is
selective perception. When prices are going down, analysts often attend to the
past (saying the stock is a bargain relative to its prior price), rather than the
future (the downward trend may well continue). As one money manager noted,
“Each time the market went down was a new opportunity to buy the stock even
cheaper.” 12 That much is true, of course, but it shows the dangers of selective
perception: by looking only at the past price, analysts were relying on a false ref-
erence point and failing to recognize that what has fallen can fall further still.
3 Identify the shortcuts
individuals use in making
judgments about others.

Person Perception: Making Judgments About Others 171
Halo Effect When we draw a general impression about an individual on the
basis of a single characteristic, such as intelligence, sociability, or appearance, a
halo effect is operating. 13 If you’re a critic of President Obama, try listing 10 things
you admire about him. If you’re an admirer, try listing 10 things you dislike about
him. No matter which group describes you, odds are you won’t find this an easy
exercise! That’s the halo effect: our general views contaminate our specific ones.
The reality of the halo effect was confirmed in a classic study in which sub-
jects were given a list of traits such as intelligent, skillful, practical, industrious,
determined, and warm and asked to evaluate the person to whom those traits
applied. 14 Subjects judged the person to be wise, humorous, popular, and imag-
inative. When the same list was modified to include “cold” instead of “warm,” a
completely different picture emerged. Clearly, the subjects were allowing a sin-
gle trait to influence their overall impression of the person they were judging.
Contrast Effects An old adage among entertainers is “Never follow an act that
has kids or animals in it.” Why? Audiences love children and animals so much
that you’ll look bad in comparison. This example demonstrates how a contrast
effect can distort perceptions. We don’t evaluate a person in isolation. Our
reaction is influenced by other persons we have recently encountered.
W
e realize just how much we
take our perceptions of the
world for granted when we
try to see through the eyes of some-
one who grew up in a culture totally
different from our own.
For instance, people see the pas-
sage of time quite differently in different
cultures. Some cultures tend to focus
more on the past, others on the future.
Li-Jun Ji and colleagues investigated
how Chinese perceive events relative
to Canadians’ perceptions. Participants
read a description of a theft, along with
descriptions of events that occurred in
the distant past, recent past, or present.
When attempting to solve the case,
Chinese participants were more likely
to rely on events from the distant past
and recent past, whereas Canadians
were more attentive to recent events.
Even the way we visualize the pas-
sage of time differs across cultures.
Lera Boroditsky, Orly Fuhrman, and
Kelly McCormick from Stanford
University examined how American
English speakers and Mandarin
(Chinese) speakers differed in their
perception of time. Because English
uses phrases like “looking forward
to” events or “putting the past behind
us,” English speakers tend to think
about time as a horizontal timeline.
Mandarin however uses words like
shàng (up) and xià (down) to refer to
time, so events accumulate in a stack.
Could this difference in language struc-
ture explain why Chinese speakers pay
more attention to history when think-
ing about events? Do Chinese think
more about events “piling up” on top
of one another (making them more
relevant), whereas North Americans
think about events moving away in
time so that what is in the past is over
and done? Further research will have
to examine whether this is the case,
but it remains an interesting possibility.
Sources: L. Ji, Z. Zhang, and D. Messervey,
“Looking Into the Past: Cultural Differences
in Perception and Representation of
Past Information,” Journal of Personality
and Social Psychology 96, no. 4 (2009),
pp. 761–769; L. Boroditsky, O. Fuhrman,
and K. McCormick, “Do English and
Mandarin Speakers Think about Time
Differently?” Cognition 118, no. 1 (2011),
pp. 123–129; and A. J. Shipp, J. R. Edwards,
and L. S. Lambert, “Conceptualization and
Measurement of Temporal Focus: The
Subjective Experience of Past, Present,
and Future,” Organizational Behavior and
Human Decision Processes 110, no. 1
(2009), pp. 1–22.
glOBalization!
Chinese Time, North American Time
selective perception The tendency
to selectively interpret what one
sees on the basis of one’s interests,
background, experience, and attitudes.
halo effect The tendency to draw a
general impression about an individual
on the basis of a single characteristic.
contrast effect Evaluation of a
person’s characteristics that is affected
by comparisons with other people
recently encountered who rank higher
or lower on the same characteristics.

172 CHAPTER 6 Perception and Individual Decision Making
In a series of job interviews, for instance, interviewers can make distortions
in any given candidate’s evaluation as a result of his or her place in the inter-
view schedule. A candidate is likely to receive a more favorable evaluation if
preceded by mediocre applicants and a less favorable evaluation if preceded by
strong applicants.
Stereotyping When we judge someone on the basis of our perception
of the group to which he or she belongs, we are using the shortcut called
stereotyping . 15
We rely on generalizations every day because they help us make decisions
quickly; they are a means of simplifying a complex world. It’s less difficult to
deal with an unmanageable number of stimuli if we use heuristics or stereo-
types. For example, it does make sense to assume that Tre, the new employee
from accounting, is going to know something about budgeting, or that Allie
from finance will be able to help you figure out a forecasting problem. The
problem occurs, of course, when we generalize inaccurately or too much. In
organizations, we frequently hear comments that represent stereotypes based
on gender, age, race, religion, ethnicity, and even weight (see Chapter 2 ): 16
“Men aren’t interested in child care,” “Older workers can’t learn new skills,”
“Asian immigrants are hardworking and conscientious.” A growing body of re-
search suggests stereotypes operate emotionally and often below the level of
conscious awareness, making them particularly hard to challenge and change. 17
Stereotypes can be deeply ingrained and powerful enough to influence
life-and-death decisions. One study, controlling for a wide array of factors
(such as aggravating or mitigating circumstances), showed that the degree to
which black defendants in murder trials looked “stereotypically black” essen-
tially doubled their odds of receiving a death sentence if convicted. 18 Another
experimental study found that students who read scenarios describing leaders
tended to assign higher scores for leadership potential and effective leader-
ship to Whites than to minorities even though the content of the scenarios was
equivalent, supporting the idea of a stereotype of Whites as better leaders. 19
These young women are taking
part in a running test for employ-
ment in a police force in Peshawar,
Pakistan. But women in America
and European, Eastern European,
Asian, and Latin American countries
report that gender stereotyping
makes it difficult for them to enter
the profession because it is largely
regarded as a job strictly for men.
Even in countries like the United
States where the law requires hir-
ing police officers without regard
to gender, the stereotypical view
of women inaccurately generalizes
them as lacking the mental, physi-
cal, and emotional fitness required
to perform police work. But women
who want to do police work con-
tend that they satisfy the fitness
requirements and even bring special
qualities to the job such as compas-
sion and good communication skills.
So
ur
ce
:
Pa
ki
st
an
P
re
ss
In
te
rn
at
io
na
l P
ho
to
/N
ew
sc
om

Person Perception: Making Judgments About Others 173
One problem of stereotypes is that they are widespread and often useful
generalizations, though they may not contain a shred of truth when applied to a
particular person or situation. So we constantly have to check ourselves to make
sure we’re not unfairly or inaccurately applying a stereotype in our evaluations
and decisions. Stereotypes are an example of the warning “The more useful,
the more danger from misuse.”
Specific Applications of Shortcuts in Organizations
People in organizations are always judging each other. Managers must appraise
their employees’ performances. We evaluate how much effort our co-workers are
putting into their jobs. Team members immediately “size up” a new person. In
many cases, our judgments have important consequences for the organization.
Let’s look at the most obvious applications.
Employment Interview Few people are hired without an interview. But
interviewers make perceptual judgments that are often inaccurate 20 and draw
early impressions that quickly become entrenched. Research shows we form
impressions of others within a tenth of a second, based on our first glance. 21 If
these first impressions are negative, they tend to be more heavily weighted in
the interview than if that same information came out later. 22 Most interviewers’
decisions change very little after the first 4 or 5 minutes of an interview. As a
result, information elicited early in the interview carries greater weight than
does information elicited later, and a “good applicant” is probably character-
ized more by the absence of unfavorable characteristics than by the presence of
favorable ones.
Performance Expectations People attempt to validate their perceptions of
reality even when these are faulty. 23 The terms self-fulfilling prophecy and
Pygmalion effect describe how an individual’s behavior is determined by others’
expectations. If a manager expects big things from her people, they’re not likely
to let her down. Similarly, if she expects only minimal performance, they’ll likely
meet those low expectations. Expectations become reality. The self-fulfilling
prophecy has been found to affect the performance of students, soldiers, and
even accountants. 24
Performance Evaluation We’ll discuss performance evaluations more fully in
Chapter 17 , but note for now that they very much depend on the perceptual
process. 25 An employee’s future is closely tied to the appraisal—promotion,
pay raises, and continuation of employment are among the most obvious
outcomes. Although the appraisal can be objective (for example, a sales-person
is appraised on how many dollars of sales he generates in his territory), many
jobs are evaluated in subjective terms. Subjective evaluations, though often
necessary, are problematic because all the errors we’ve discussed thus far—
selective perception, contrast effects, halo effects, and so on—affect them.
Ironically, sometimes performance ratings say as much about the evaluator as
they do about the employee!
stereotyping Judging someone on the
basis of one’s perception of the group
to which that person belongs.
self-fulfilling prophecy A situation in
which a person inaccurately perceives
a second person, and the resulting
expectations cause the second person
to behave in ways consistent with the
original perception.

174 CHAPTER 6 Perception and Individual Decision Making
Individuals in organizations make decisions , choices from among two or more
alternatives. Top managers determine their organization’s goals, what products
or services to offer, how best to finance operations, or where to locate a new
manufacturing plant. Middle- and lower-level managers set production sched-
ules, select new employees, and decide how to allocate pay raises. Nonmanagerial
employees decide how much effort to put forth at work and whether to comply
with a boss’s request. Organizations have begun empowering their nonmanage-
rial employees with decision-making authority historically reserved for managers
alone. Individual decision making is thus an important part of organizational
behavior. But the way individuals make decisions and the quality of their choices
are largely influenced by their perceptions.
Decision making occurs as a reaction to a problem . 26 That is, a discrepancy
exists between the current state of affairs and some desired state, requiring
us to consider alternative courses of action. If your car breaks down and you
rely on it to get to work, you have a problem that requires a decision on your
part. Unfortunately, most problems don’t come neatly labeled “problem.” One
person’s problem is another person’s satisfactory state of affairs. One manager may
view her division’s 2 percent decline in quarterly sales to be a serious prob-
lem requiring immediate action on her part. In contrast, her counterpart in
another division, who also had a 2 percent sales decrease, might consider that
quite acceptable. So awareness that a problem exists and that a decision might
or might not be needed is a perceptual issue.
Every decision requires us to interpret and evaluate information. We
typically receive data from multiple sources and need to screen, process, and
interpret them. Which data are relevant to the decision, and which are not?
Our perceptions will answer that question. We also need to develop alter-
natives and evaluate their strengths and weaknesses. Again, our perceptual
4 Explain the link between
perception and decision
making.
The Link Between Perception and Individual Decision Making
Delta Airlines management made a
decision in reaction to the problem
of negative publicity resulting from
a growing number of customer
complaints about poor service. To
improve service, Delta reinstated
the personal assistance of its elite
Red Coat airport agents that it
started in the 1960s but eliminated
in 2005 due to budget cuts. The
primary mission of the Red Coats,
such as Charmaine Gordon shown
here helping customers at Kennedy
International Airport in New York,
is to fix customer problems. Today,
Delta has about 800 Red Coats who
walk around airports and use hand-
held devices to give one-on-one,
on-the-spot help to customers in
everything ranging from printing
boarding passes to directing passen-
gers to the right concourse.
MyManagementLab
For an interactive application of this
topic, check out this chapter’s
simulation activity at
www.mymanagementlab.com.
So
ur
ce
:
Je
ss
ic
a
Eb
el
ha
r
/
Th
e
N
ew
Y
or
k
Ti
m
es
/
Re
du
x
Pi
ct
ur
es

www.mymanagementlab.com

Decision Making in Organizations 175
process will affect the final outcome. Finally, throughout the entire decision-
making process, perceptual distortions often surface that can bias analysis and
conclusions.
Decision Making in Organizations
Business schools generally train students to follow rational decision-making
models. While models have considerable merit, they don’t always describe how
people actually make decisions. This is where OB enters the picture: to improve
the way we make decisions in organizations, we must understand the decision-
making errors people commit (in addition to the perception errors we’ve
discussed). Next we describe these errors, beginning with a brief overview of
the rational decision-making model.
The Rational Model, Bounded Rationality, and Intuition
Rational Decision Making We often think the best decision maker is rational
and makes consistent, value-maximizing choices within specified constraints. 27
These decisions follow a six-step rational decision-making model . 28 The six steps
are listed in Exhibit 6-3 .
The rational decision-making model relies on a number of assumptions,
including that the decision maker has complete information, is able to iden-
tify all the relevant options in an unbiased manner, and chooses the option
with the highest utility. 29 As you might imagine, most decisions in the real
world don’t follow the rational model. People are usually content to find an
acceptable or reasonable solution to a problem rather than an optimal one.
Choices tend to be limited to the neighborhood of the problem symptom and
the current alternative. As one expert in decision making put it, “Most signifi-
cant decisions are made by judgment, rather than by a defined prescriptive
model.” 30 What’s more, people are remarkably unaware of making subopti-
mal decisions. 31
5 Apply the rational model
of decision making and
contrast it with bounded
rationality and intuition.
rational Characterized by making
consistent, value-maximizing choices
within specified constraints.
rational decision-making model A
decision-making model that describes
how individuals should behave in
order to maximize some outcome.
decisions Choices made from among
two or more alternatives.
problem A discrepancy between
the current state of affairs and some
desired state.
Steps in the Rational Decision-Making Model Exhibit 6-3
1. Define the problem.
2. Identify the decision criteria.
3. Allocate weights to the criteria.
4. Develop the alternatives.
5. Evaluate the alternatives.
6. Select the best alternative.

176 CHAPTER 6 Perception and Individual Decision Making
Bounded Rationality Our limited information-processing capability makes it
impossible to assimilate and understand all the information necessary to opti-
mize. 32 So most people respond to a complex problem by reducing it to a level at
which they can readily understand it. Also many problems don’t have an optimal
solution because they are too complicated to fit the rational decision-making
model. So people satisfice; they seek solutions that are satisfactory and sufficient.
When you considered which college to attend, did you look at every viable
alternative? Did you carefully identify all the criteria that were important in
your decision? Did you evaluate each alternative against the criteria in order
to find the optimal college? The answers are probably “no.” Well, don’t feel
bad. Few people made their college choice this way. Instead of optimizing, you
probably satisficed.
Because the human mind cannot formulate and solve complex problems
with full rationality, we operate within the confines of bounded rationality . We
construct simplified models that extract the essential features from problems
without capturing all their complexity. 33 We can then behave rationally within
the limits of the simple model.
How does bounded rationality work for the typical individual? Once we’ve
identified a problem, we begin to search for criteria and alternatives. But the
criteria are unlikely to be exhaustive. We identify choices that are easy to find
and highly visible and that usually represent familiar criteria and tried- and-
true solutions. Next, we begin reviewing them, focusing on alternatives that
differ little from the choice currently in effect until we identify one that is
“good enough”—that meets an acceptable level of performance. That ends our
search. So the solution represents a satisficing choice—the first acceptable one
we encounter—rather than an optimal one.
Satisficing is not always a bad idea—a simple process may frequently be
more sensible than the traditional rational decision-making model. 34 To use the
rational model in the real world, you need to gather a great deal of information
about all the options, compute applicable weights, and then calculate values
across a huge number of criteria. All these processes can cost time, energy,
Top managers of Nike, Inc.
operated within the confines of
bounded rationality in making a
decision about its operations in
China. To reinforce its future devel-
opment and rapid growth in China,
Nike decided to invest $99 million
to build the China Logistics Center,
a new distribution facility in Jiangsu
for the company’s footwear,
apparel, and equipment products.
With China overtaking Japan as
Nike’s second largest market after
the United States, the new distribu-
tion center is expected to reduce
product delivery times by up to
14 percent to the more than
3,000 Nike retail stores in China.
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Decision Making in Organizations 177
and money. And if there are many unknown weights and preferences, the fully
rational model may not be any more accurate than a best guess. Sometimes a
fast-and-frugal process of solving problems might be your best option. Returning
to your college choice, would it really be smarter to fly around the country
to visit dozens of potential campuses, paying application fees for all these
options? Can you really even know what type of college is “best” for you when
you’re just graduating from high school, or is there a lot of unknown informa-
tion about how your interests are going to develop over time? Maybe you won’t
major in the same subject you started with. It might be much smarter to find a
few colleges that match most of your preferences and then focus your attention
on differentiating between those.
Intuition Perhaps the least rational way of making decisions is intuitive decision
making , an unconscious process created from distilled experience. 35 It occurs
outside conscious thought; it relies on holistic associations, or links between
disparate pieces of information; it’s fast; and it’s affectively charged, meaning it
usually engages the emotions. 36
While intuition isn’t rational, it isn’t necessarily wrong. Nor does it always
contradict rational analysis; rather, the two can complement each other. But nor
is intuition superstition, or the product of some magical or paranormal sixth
sense. As one recent review noted, “Intuition is a highly complex and highly de-
veloped form of reasoning that is based on years of experience and learning.” 37
For most of the twentieth century, experts believed decision makers’ use
of intuition was irrational or ineffective. That’s no longer the case. 38 We now
recognize that rational analysis has been overemphasized and, in certain
instances, relying on intuition can improve decision making. 39 But we can’t rely
on it too much. Because it is so unquantifiable, it’s hard to know when our
hunches are right or wrong. The key is neither to abandon nor rely solely on
intuition, but to supplement it with evidence and good judgment.
Common Biases and Errors in Decision Making
Decision makers engage in bounded rationality, but they also allow systematic
biases and errors to creep into their judgments. 40 To minimize effort and avoid
difficult trade-offs, people tend to rely too heavily on experience, impulses,
gut feelings, and convenient rules of thumb. These shortcuts can be helpful.
However, they can also distort rationality. Following are the most common
biases in decision making. Exhibit 6-4 provides some suggestions for how to
avoid falling into these biases and errors.
Overconfidence Bias It’s been said that “no problem in judgment and deci-
sion making is more prevalent and more potentially catastrophic than overconfi-
dence.” 41 When we’re given factual questions and asked to judge the probability
that our answers are correct, we tend to be far too optimistic. When people say
they’re 90 percent confident about the range a certain number might take, their
estimated ranges contain the correct answer only about 50 percent of the time—
and experts are no more accurate in setting up confidence intervals than are
bounded rationality A process of
making decisions by constructing
simplified models that extract the
essential features from problems
without capturing all their complexity.
intuitive decision making An
unconscious process created out of
distilled experience.
6 List and explain the
common decision
biases or errors.

178 CHAPTER 6 Perception and Individual Decision Making
novices. 42 When people say they’re 100 percent sure of an outcome, they tend
to be 70 to 85 percent correct. 43 Here’s another interesting example. In one
random-sample national poll, 90 percent of U.S. adults said they expected to go
to heaven. But in another random-sample national poll, only 86 percent thought
Mother Teresa was in heaven. Talk about an overconfidence bias!
Individuals whose intellectual and interpersonal abilities are weakest are most
likely to overestimate their performance and ability. 44 There’s also a negative
relationship between entrepreneurs’ optimism and the performance of their
new ventures: the more optimistic, the less successful. 45 The tendency to be
too confident about their ideas might keep some from planning how to avoid
problems that arise.
Investor overconfidence operates in a variety of ways. 46 Finance professor
Terrance Odean says “people think they know more than they do, and it costs
them.” Investors, especially novices, overestimate not just their own skill in
processing information, but also the quality of the information they’re working
with. Test your own confidence level with investments: compare the long-term
returns of your stock market picks relative to index funds. You’ll find an overall
index performs as well as, or better than, carefully hand-picked stocks. The
main reason many people resist index funds is that they think they’re better at
picking stocks than the average person, but most investors will actually do only
as well as or only slightly better than the market as a whole.
Anchoring Bias The anchoring bias is a tendency to fixate on initial infor-
mation and fail to adequately adjust for subsequent information. 47 It occurs
because our mind appears to give a disproportionate amount of emphasis to the
first information it receives. Anchors are widely used by people in professions
in which persuasion skills are important—advertising, management, politics,
real estate, and law. Assume two pilots—Jason and Glenda—have been laid
Reducing Biases and Errors Exhibit 6-4
Focus on Goals. Without goals, you can’t be rational, you don’t know what information you
need, you don’t know which information is relevant and which is irrelevant, you’ll find it
difficult to choose between alternatives, and you’re far more likely to experience regret
over the choices you make. Clear goals make decision making easier and help you eliminate
options that are inconsistent with your interests.
Look for Information That Disconfirms Your Beliefs. One of the most effective means for
counteracting overconfidence and the confirmation and hindsight biases is to actively look
for information that contradicts your beliefs and assumptions. When we overtly consider
various ways we could be wrong, we challenge our tendencies to think we’re smarter than
we actually are.
Don’t Try to Create Meaning out of Random Events. The educated mind has been trained
to look for cause-and-effect relationships. When something happens, we ask why. And
when we can’t find reasons, we often invent them. You have to accept that there are events
in life that are outside your control. Ask yourself if patterns can be meaningfully explained
or whether they are merely coincidence. Don’t attempt to create meaning out of
coincidence.
Increase Your Options. No matter how many options you’ve identified, your final choice can
be no better than the best of the option set you’ve selected. This argues for increasing your
decision alternatives and for using creativity in developing a wide range of diverse choices.
The more alternatives you can generate, and the more diverse those alternatives, the
greater your chance of finding an outstanding one.
Source: S. P. Robbins, Decide & Conquer: Making Winning Decisions and Taking Control of Your Life (Upper Saddle River, NJ: Financial
Times/Prentice Hall, 2004), pp. 164–168.

Decision Making in Organizations 179
off their current jobs, and after an extensive search their best offers are from
Delta Airlines. Each would earn the average annual pay of Delta’s narrow-body
jet pilots: $126,000. Jason was a pilot for Pinnacle, a regional airline where
the average annual salary is $82,000. Glenda was a pilot for FedEx, where
the average annual salary is $200,000. Which pilot is most likely to accept, or
be happiest with, Delta’s offer? Obviously Jason, because he is anchored by the
lower salary. 48
Any time a negotiation takes place, so does anchoring. When a prospective
employer asks how much you made in your prior job, your answer typically an-
chors the employer’s offer. (Remember this when you negotiate your salary,
but set the anchor only as high as you realistically can.) Finally, the more
precise your anchor, the smaller the adjustment. Some research suggests
people think of making an adjustment after an anchor is set as rounding off
a number. If you suggest a target salary of $55,000, your boss will consider
$50,000 to $60,000 a reasonable range for negotiation, but if you mention
$55,650, your boss is more likely to consider $55,000 to $56,000 the range of
likely values. 49
Confirmation Bias The rational decision-making process assumes we
objectively gather information. But we don’t. We selectively gather it. The
confirmation bias represents a specific case of selective perception: we seek
out information that reaffirms our past choices, and we discount informa-
tion that contradicts them. 50 We also tend to accept at face value information
that confirms our preconceived views, while we are critical and skeptical of
information that challenges them. Therefore, the information we gather is
typically biased toward supporting views we already hold. We even tend to
seek sources most likely to tell us what we want to hear, and we give too much
weight to supporting information and too little to contradictory. Interestingly,
we are most prone to the confirmation bias when we believe we have good
information and strongly believe in our opinions. Fortunately, those who feel
there is a strong need to be accurate in making a decision are less prone to
the confirmation bias.
Availability Bias More people fear flying than fear driving in a car. But if flying
on a commercial airline really were as dangerous as driving, the equivalent of
two 747s filled to capacity would crash every week, killing all aboard. Because
the media give much more attention to air accidents, we tend to overstate the
risk of flying and understate the risk of driving.
The availability bias is our tendency to base judgments on information read-
ily available. 51 Events that evoke emotions, are particularly vivid, or are more
recent tend to be more available in our memory, leading us to overestimate the
chances of unlikely events such as an airplane crash. The availability bias can
also explain why managers doing performance appraisals give more weight to
recent employee behaviors than to behaviors of 6 or 9 months earlier, or why
credit-rating agencies such as Moody’s or Standard & Poor’s may issue overly
positive ratings by relying on information presented by debt issuers, who have
an incentive to offer data favorable to their case. 52
anchoring bias A tendency to fixate
on initial information, from which
one then fails to adequately adjust for
subsequent information.
confirmation bias The tendency to
seek out information that reaffirms
past choices and to discount
information that contradicts past
judgments.
availability bias The tendency for
people to base their judgments on
information that is readily available to
them.

180 CHAPTER 6 Perception and Individual Decision Making
Escalation of Commitment Another distortion that creeps into decisions is a
tendency to escalate commitment. 53 Escalation of commitment refers to staying
with a decision even when there is clear evidence it’s wrong. Consider a friend
who has been dating someone for several years. Although he admits things
aren’t going too well, he says he is still going to marry her. His justification:
“I have a lot invested in the relationship!”
Individuals escalate commitment to a failing course of action when they view
themselves as responsible for the failure. 54 They “throw good money after bad”
to demonstrate their initial decision wasn’t wrong and to avoid admitting they
made a mistake. 55 In fact, people who carefully gather and consider information
consistent with the rational decision-making model are more likely to engage in
escalation of commitment than those who spend less time thinking about their
choices. 56 Perhaps they have invested so much time and energy in making their
decisions that they have convinced themselves they’re taking the right course of
action and don’t update their knowledge in the face of new information. Many
an organization has suffered because a manager determined to prove his or her
original decision right continued to commit resources to a lost cause.
Randomness Error Most of us like to think we have some control over our
world and our destiny. Our tendency to believe we can predict the outcome of
random events is the randomness error .
Decision making suffers when we try to create meaning in random events,
particularly when we turn imaginary patterns into superstitions. 57 These can be
completely contrived (“I never make important decisions on Friday the 13th”)
or can evolve from a reinforced past pattern of behavior (Tiger Woods often
wears a red shirt during a golf tournament’s final round because he won many
junior tournaments wearing red shirts). Superstitious behavior can be debilitat-
ing when it affects daily judgments or biases major decisions.
Risk Aversion Mathematically, we should find a 50–50 flip of the coin for
$100 to be worth as much as a sure promise of $50. After all, the expected value
of the gamble over a number of trials is $50. However, nearly everyone but
committed gamblers would rather have the sure thing than a risky prospect. 58
For many people, a 50–50 flip of a coin even for $200 might not be worth as
much as a sure promise of $50, even though the gamble is mathematically
worth twice as much! This tendency to prefer a sure thing over a risky outcome
is risk aversion .
Risk aversion has important implications. To offset the risks inherent in a
commission-based wage, companies pay commissioned employees consider-
ably more than they do those on straight salaries. Risk-averse employees will
stick with the established way of doing their jobs, rather than taking a chance
on innovative or creative methods. Sticking with a strategy that has worked
in the past does minimize risk, but in the long run it will lead to stagnation.
Ambitious people with power that can be taken away (most managers) appear
to be especially risk averse, perhaps because they don’t want to lose on a gamble
everything they’ve worked so hard to achieve. 59 CEOs at risk of being termi-
nated are also exceptionally risk averse, even when a riskier investment strategy
is in their firms’ best interests. 60
Because people are less likely to escalate commitment where there is a great
deal of uncertainty, the implications of risk aversion aren’t all bad. 61 When a
risky investment isn’t paying off, most people would rather play it safe and cut
their losses, but if they think the outcome is a sure thing, they’ll keep escalating.
Risk preference is sometimes reversed: people prefer to take their chances when
trying to prevent a negative outcome. 62 They would rather take a 50–50 gamble on

Decision Making in Organizations 181
losing $100 than accept the certain loss of $50. Thus they will risk losing a lot of
money at trial rather than settle out of court. Trying to cover up wrongdoing instead
of admitting a mistake, despite the risk of truly catastrophic press coverage or even
jail time, is another example. Stressful situations can make these risk preferences
stronger. People will more likely engage in risk-seeking behavior for negative out-
comes, and risk-averse behavior for positive outcomes, when under stress. 63
Hindsight Bias The hindsight bias is the tendency to believe falsely, after
the outcome is known, that we’d have accurately predicted it. 64 When we have
accurate feedback on the outcome, we seem pretty good at concluding it was
obvious.
Over the past 10 years, the home video rental industry has been collapsing
fast as online distribution outlets have eaten away at the market. 65 Hollywood
Video declared bankruptcy in May 2010 and began liquidating its assets;
Blockbuster filed for bankruptcy in September 2010. Some have suggested that
if only these organizations had leveraged their brand and distribution resources
O
ne article of faith in creativity
research and practice is that
whereas the left brain gov-
erns analytical, rational thinking, the
right brain underlies creative think-
ing. However, judging from a recent
review of neuropsychology research,
this accepted wisdom is false.
Neuropsychologists study creativity
by asking people to engage in creative
thinking, which they measure in differ-
ent ways. In the Remote Associates
Test, individuals indicate what word
links a series of three words (such as
Falling Actor Dust; Salt Deep Foam).
Other tests ask individuals to compose
creative stories, write captions for car-
toons, or provide unique solutions to
unusual hypothetical problems. While
participants are thinking creatively, the
researchers assess their brain activity
using various techniques, including
MRI.
A recent review of 72 studies found
right brain activity was not associated
with creative thinking. The authors
conclude, “Creativity, or any alleged
stage of it, is not particularly associ-
ated with the right brain or any part
of the right brain.” Indeed, the review
showed it was difficult to isolate cre-
ative thinking in any one region of the
brain.
Another review of 45 studies
reached the same conclusion, noting
that the diverse ways in which creativ-
ity and brain activity were measured
made generalizations difficult.
These results do not discourage all
neuropsychologists. One neuroscien-
tist, Oshin Vartanian, summed up the
literature as follows: “Initially, a lot of
people were looking for the holy grail.
They were searching for the creativity
module in the brain. Now we know it
is more complicated.”
Sources: A. Dietrich and R. Kanso, “A Review
of EEG, ERP, and Neuroimaging Studies
of Creativity and Insight,” Psychological
Bulletin 136, no. 5 (2010), pp. 822–848;
R. Ardena, R. S. Chavez, R. Grazioplene,
& R. E. Jung, “Neuroimaging Creativity:
A Psychometric View,” Behavioural Brain
Research 214, no. 2 (2010), pp. 143–156;
and A. McIlroy, “Neuroscientists Try to
Unlock the Origins of Creativity,” Globe and
Mail (January 28, 2011), downloaded May 20,
2011, from www.theglobeandmail.com/ .
Myth or Science?
Creative Decision Making Is a Right-Brain Activity
hindsight bias The tendency to
believe falsely, after an outcome of
an event is actually known, that one
would have accurately predicted that
outcome.
escalation of commitment An
increased commitment to a previous
decision in spite of negative
information.
randomness error The tendency of
individuals to believe that they can
predict the outcome of random events.
risk aversion The tendency to prefer
a sure gain of a moderate amount over
a riskier outcome, even if the riskier
outcome might have a higher expected
payoff.

www.theglobeandmail.com/

182 CHAPTER 6 Perception and Individual Decision Making
effectively and sooner to develop web-based delivery, as Netflix does, and low-
cost distribution in grocery and convenience stores, which Redbox offers, they
could have been avoided failure. While that might seem obvious now, many
experts with good information failed to see these two major trends that would
upend the industry.
Of course, after the fact, it is easy to see that a combination of automated
and mail-order distribution would outperform the traditional brick-and-mortar
movie rental business. Similarly, former Merrill Lynch CEO John Thain—and
many other Wall Street executives—took blame for failing to see what now
seems obvious (that housing prices were inflated, too many risky loans were
made, and the values of many “securities” were based on fragile assumptions).
Though the criticisms may have merit, things are often all too clear in hind-
sight. As Malcolm Gladwell, author of Blink and The Tipping Point, writes, “What
is clear in hindsight is rarely clear before the fact.” 66
The hindsight bias reduces our ability to learn from the past. It lets us think
we’re better predictors than we are and can make us falsely confident. If your
actual predictive accuracy is only 40 percent but you think it’s 90, you’re likely
to be less skeptical about your predictive skills.
Application: Financial Decision Making This discussion of decision mak-
ing errors may have you thinking about how organizations and individuals
make financial decisions. Did decision errors influence capital markets and
even lead to crises like the financial meltdown of 2008? How are financial de-
cisions affected by errors and biases? Experts have identified several ways this
can occur. 67
One of the core problems that created the financial crisis was that large
loans were made to individuals who could not repay them, and finance com-
panies purchased these bad debts without realizing how poor the prospects
of repayment were. Thus, overconfidence bias by both lenders and borrowers
When the U.S.-based global finan-
cial services firm Lehman Brothers
failed, many people blamed Richard
Fuld, the company’s chief executive,
accusing him of overconfidence,
confirmation, and anchoring biases
and a lack of knowledge about
complicated financial investment
instruments. Even as Lehman
Brothers continued to post billion-
dollar losses, Fuld exuded confi-
dence that the investment bank was
sound, and he rebuffed criticism of
the bank’s failure to value its assets
accurately. Comments by former
employees and passersby blam-
ing Fuld for the bankruptcy were
recorded on an artists’ rendering
of him placed in front of Lehman’s
offices in New York City.
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Decision Making in Organizations 183
about the ability to pay back loans was clearly a major factor. Most studies
suggest that people are more willing to buy on credit and spend more
money when they feel confident. Although experts were no more accurate at
predicting financial outcomes than were people without knowledge or skills
in finance, they were more confident in their predictions. Unfortunately, as
confidence decreases in the face of poor economic data, businesses and con-
sumers become more conservative in their spending. This further decreases
demand for products and services, which deepens the economic crisis in a
vicious cycle.
Overconfidence isn’t the only decision error implicated in the financial
crisis. Investors deliberately avoid negative information about investments,
an example of the confirmation bias. Lenders may have overlooked potential
problems with borrowers’ accounts when making loans, and stock traders may
have ignored information about potential problems with complex derivatives
when making purchasing decisions. Once a loan has been paid off, lenders also
selectively ignore the negative effects of debt, making them more likely to make
unwise loans in the future.
What might prevent these situations from occurring in the future? Both in-
vestors and consumers may need to more carefully consider whether their con-
fidence level is aligned with their actual future ability to pay. It is also always
a good idea to seek information that goes against your initial inclinations, to
ensure you’re getting the whole picture. Be careful not to commit the hindsight
bias and conclude after financial crises have dissipated that it should have been
obvious problems were about to occur.
Gloomy Perceptions ReturnOB Poll
February, 2008
33%
12%
September, 2008
36%
33%
April, 2011
26%
29%
Percent Indicating Economy Is in Recession or Depression
Depression
Recession
80
70
60
50
40
30
20
10
0
Source: Based on C. Merkle and M. Weber, “True Overconfidence—The Inability of Rational Information Processing to Account for Apparent Overconfidence”
(March 2009). Available at SSRN: http://ssrn.com/abstract�1373675
S A L
SELF-ASSESSMENT LIBRARY
Am I A Deliberate Decision Maker?
In the Self-Assessment Library (available on CD or online), take assessment IV.A.2
(Am I a Deliberate Decision Maker?). Would it be better to be a more deliberate
decision maker? Why or why not?

http://ssrn.com/abstract=1373675

184 CHAPTER 6 Perception and Individual Decision Making
We turn here to factors that influence how people make decisions and the de-
gree to which they are susceptible to errors and biases. We discuss individual
differences and organizational constraints.
Individual Differences
Decision making in practice is characterized by bounded rationality, common
biases and errors, and the use of intuition. In addition, individual differences
create deviations from the rational model. In this section, we look at two such
differences: personality and gender.
Personality The little research so far conducted on personality and decision
making suggests personality does influence our decisions. Let’s look at consci-
entiousness and self-esteem (both discussed in Chapter 5 ).
Specific facets of conscientiousness—rather than the broad trait itself—
may affect escalation of commitment (above). 68 Two such facets—achievement
striving and dutifulness—actually had opposite effects. Achievement-striving
people were more likely to escalate their commitment, whereas dutiful peo-
ple were less likely. Why? Generally, achievement-oriented people hate to
fail, so they escalate their commitment, hoping to forestall failure. Dutiful
people, however, are more inclined to do what they see as best for the orga-
nization. Second, achievement-striving individuals appear more susceptible to
the hindsight bias, perhaps because they have a greater need to justify their
actions. 69 Unfortunately, we don’t have evidence on whether dutiful people
are immune to this bias.
Finally, people with high self-esteem are strongly motivated to maintain it, so
they use the self-serving bias to preserve it. They blame others for their failures
while taking credit for successes. 70
Gender Research on rumination offers insights into gender differences in de-
cision making. 71 Rumination refers to reflecting at length. In terms of decision
making, it means overthinking problems. Twenty years of study find women
spend much more time than men analyzing the past, present, and future.
They’re more likely to overanalyze problems before making a decision and to
rehash a decision once made. This can lead to more careful consideration of
problems and choices. However, it can make problems harder to solve, increase
regret over past decisions, and increase depression. Women are nearly twice as
likely as men to develop depression. 72
Why women ruminate more than men is not clear. One view is that parents
encourage and reinforce the expression of sadness and anxiety more in girls
than in boys. Another theory is that women, more than men, base their self-
esteem and well-being on what others think of them. A third idea is that women
are more empathetic and more affected by events in others’ lives, so they have
more to ruminate about.
By age 11, girls are ruminating more than boys. But this gender difference
seems to lessen with age. Differences are largest during young adulthood and
smallest after age 65, when both men and women ruminate the least. 73
7 Explain how individual
differences and organiza-
tional constraints affect
decision making.
Influences on Decision Making: Individual Differences
and Organizational Constraints

Influences on Decision Making: Individual Differences and Organizational Constraints 185
Mental Ability We know people with higher levels of mental ability are able to
process information more quickly, solve problems more accurately, and learn
faster, so you might expect them also to be less susceptible to common deci-
sion errors. However, mental ability appears to help people avoid only some of
these. 74 Smart people are just as likely to fall prey to anchoring, overconfidence,
and escalation of commitment, probably because just being smart doesn’t alert
you to the possibility you’re too confident or emotionally defensive. That doesn’t
mean intelligence never matters. Once warned about decision-making errors,
more intelligent people learn more quickly to avoid them. They are also better
able to avoid logical errors like false syllogisms or incorrect interpretation of data.
Cultural Differences The rational model makes no acknowledgment of cultural
differences, nor does the bulk of OB research literature on decision making.
But Indonesians, for instance, don’t necessarily make decisions the same way
Australians do. Therefore, we need to recognize that the cultural background
of a decision maker can significantly influence the selection of problems, the
depth of analysis, the importance placed on logic and rationality, and whether
organizational decisions should be made autocratically by an individual man-
ager or collectively in groups. 75
Cultures differ in their time orientation, the importance of rationality, their
belief in the ability of people to solve problems, and their preference for col-
lective decision making. Differences in time orientation help us understand
why managers in Egypt make decisions at a much slower and more deliberate
pace than their U.S. counterparts. While rationality is valued in North America,
that’s not true elsewhere in the world. A North American manager might make
an important decision intuitively but know it’s important to appear to proceed
A
s we note in the chapter, dif-
ferent standards identify ethical
behavior in different cultures.
Managers who work in international
contexts frequently run into complex
problems when behavior acceptable
for the home office is unacceptable in
local cultures, and vice versa.
How difficult is it to arrive at a global
policy for ethical decision making?
Consider these examples. Individuals
from countries higher in Hofstede’s di-
mension of power distance, like those
in Latin America, were more likely to
report that bribery was acceptable than
were individuals from lower power dis-
tance countries, like the United States
and much of Europe. An international
scandal ensued after German corpo-
ration Siemens set aside money for
bribes when working in Africa, but
company executives initially defended
the actions as consistent with busi-
ness practices in those countries.
Such differences don’t mean business
ethics are “higher” or “lower” in dif-
ferent countries. Although U.S. execu-
tives might frown on bribery, they may
view it as ethical and necessary to
lay workers off during poor economic
times, whereas other cultures view
layoffs as a betrayal of the relationship
between workers and employers.
So how are managers to decide
which ethical standards to observe?
Is it better to act consistently with
your own culture, or adopt the ethi-
cal standards of the countries where
you operate? This question isn’t easy
to answer. Ethics experts suggest
leaders should adhere to universal val-
ues of human life and welfare as the
core of their international codes of eth-
ics, and they note there are few cases
where values are directly in conflict
(no culture actively encourages bribery
as moral; it’s just that some societ-
ies view it as less of a problem than
others do).
Source: Based on L. J. Thompson, “The
Global Moral Compass for Business Leaders,”
Journal of Business Ethics 93, no. S1
(2010), pp. 15–32; C. Baughn, N. L. Bodie,
M. A. Buchanan, and M. B. Bixby, “Bribery
in International Business Transactions,”
Journal of Business Ethics 92, no. 1 (2010),
pp. 15–32; and T. Patel and A. Schaefer,
“Making Sense of the Diversity of Ethical
Decision Making in Business: An Illustration
of the Indian Context,” Journal of Business
Ethics 90, no. 2 (2009), pp. 171–186.
An Ethical Choice
Whose Ethical Standards to Follow?

186 CHAPTER 6 Perception and Individual Decision Making
in a rational fashion because rationality is highly valued in the West. In coun-
tries such as Iran, where rationality is not as paramount as other factors, efforts
to appear rational are not necessary.
Some cultures emphasize solving problems, while others focus on accepting
situations as they are. The United States falls in the first category; Thailand and
Indonesia are examples of the second. Because problem-solving managers be-
lieve they can and should change situations to their benefit, U.S. managers might
identify a problem long before their Thai or Indonesian counterparts would
choose to recognize it as such. Decision making by Japanese managers is much
more group-oriented than in the United States. The Japanese value conformity
and cooperation. So before Japanese CEOs make an important decision, they col-
lect a large amount of information, which they use in consensus-forming group
decisions. In short, there are probably important cultural differences in decision
making, but unfortunately not yet much research to identify them.
Organizational Constraints
Organizations can constrain decision makers, creating deviations from the ra-
tional model. For instance, managers shape their decisions to reflect the orga-
nization’s performance evaluation and reward system, to comply with its formal
regulations, and to meet organizationally imposed time constraints. Precedent
can also limit decisions.
Performance Evaluation Managers are strongly influenced by the criteria on
which they are evaluated. If a division manager believes the manufacturing
plants under his responsibility are operating best when he hears nothing nega-
tive, we shouldn’t be surprised to find his plant managers spending a good part
of their time ensuring that negative information doesn’t reach him.
Reward Systems The organization’s reward system influences decision mak-
ers by suggesting which choices have better personal payoffs. If the organization
rewards risk aversion, managers are more likely to make conservative decisions.
From the 1930s through the mid-1980s, General Motors consistently gave pro-
motions and bonuses to managers who kept a low profile and avoided con-
troversy. These executives became adept at dodging tough issues and passing
controversial decisions on to committees.
Formal Regulations David Gonzalez, a shift manager at a Taco Bell restau-
rant in San Antonio, Texas, describes constraints he faces on his job: “I’ve
got rules and regulations covering almost every decision I make—from how
to make a burrito to how often I need to clean the restrooms. My job doesn’t
come with much freedom of choice.” David’s situation is not unique. All but
the smallest organizations create rules and policies to program decisions and
get individuals to act in the intended manner. And of course, in so doing, they
limit decision choices.
System-Imposed Time Constraints Almost all important decisions come with
explicit deadlines. A report on new-product development may have to be ready
for executive committee review by the first of the month. Such conditions often
make it difficult, if not impossible, for managers to gather all the information
they might like before making a final choice.
Historical Precedents Decisions aren’t made in a vacuum; they have a context.
In fact, individual decisions are points in a stream of choice. Those made in the

What About Ethics in Decision Making? 187
past are like ghosts that haunt and constrain current choices. It’s common knowl-
edge that the largest determinant of the size of any given year’s budget is last year’s
budget. 76 Choices made today are largely a result of choices made over the years.
Formal regulations shape employee
decisions at McDonald’s restaurants
throughout the world. McDonald’s
standardizes the behavior of
restaurant crew members such as
the employee shown here prepar-
ing the company’s specialty coffee,
McCafe Mocha. McDonald’s requires
employees to follow rules and regu-
lations for food preparation and
service to meet the company’s high
standards of food quality and safety
and reliable and friendly service.
For example, McDonald’s requires
72 safety protocols to be conducted
every day in each restaurant as part
of a daily monitoring routine for
restaurant managers.
What About Ethics in Decision Making?
Ethical considerations should be an important criterion in all organizational
decision making. In this section, we present three ways to frame decisions
ethically. 77
Three Ethical Decision Criteria
The first ethical yardstick is utilitarianism , which proposes making decisions
solely on the basis of their outcomes, ideally to provide the greatest good for the
greatest number. This view dominates business decision making. It is consistent
with goals such as efficiency, productivity, and high profits.
Another ethical criterion is to make decisions consistent with fundamental
liberties and privileges, as set forth in documents such as the Bill of Rights.
An emphasis on rights in decision making means respecting and protecting the
basic rights of individuals, such as the right to privacy, free speech, and due
process. This criterion protects whistle-blowers when they reveal an organiza-
tion’s unethical practices to the press or government agencies, using their right
to free speech.
8 Contrast the three ethical
decision criteria.
utilitarianism A system in which
decisions are made to provide the
greatest good for the greatest number.
whistle-blowers Individuals who
report unethical practices by their
employer to outsiders.
So
ur
ce
:
N
ew
sc
om

188 CHAPTER 6 Perception and Individual Decision Making
A third criterion is to impose and enforce rules fairly and impartially to
ensure justice or an equitable distribution of benefits and costs. Union members
typically favor this view. It justifies paying people the same wage for a given
job regardless of performance differences and using seniority as the primary
determination in layoff decisions.
Each criterion has advantages and liabilities. A focus on utilitarianism
promotes efficiency and productivity, but it can sideline the rights of some
individuals, particularly those with minority representation. The use of rights
protects individuals from injury and is consistent with freedom and privacy, but
it can create a legalistic environment that hinders productivity and efficiency.
A focus on justice protects the interests of the underrepresented and less pow-
erful, but it can encourage a sense of entitlement that reduces risk taking,
innovation, and productivity.
Decision makers, particularly in for-profit organizations, feel comfortable
with utilitarianism. The “best interests” of the organization and its stockholders
can justify a lot of questionable actions, such as large layoffs. But many critics
feel this perspective needs to change. 78 Public concern about individual rights
and social justice suggests managers should develop ethical standards based on
nonutilitarian criteria. This presents a challenge because satisfying individual
rights and social justice creates far more ambiguities than utilitarian effects on
efficiency and profits. However, while raising prices, selling products with ques-
tionable effects on consumer health, closing down inefficient plants, laying off
large numbers of employees, and moving production overseas to cut costs can
be justified in utilitarian terms, that may no longer be the single measure by
which good decisions are judged.
Improving Creativity in Decision Making
Although the rational decision-making model will often improve decisions, a
rational decision maker also needs creativity , the ability to produce novel and
useful ideas. 79 These are different from what’s been done before but appropriate
to the problem presented.
Creativity allows the decision maker to more fully appraise and understand
the problem, including seeing problems others can’t see. L’Oréal puts its
managers through creative exercises such as cooking or making music, and the
University of Chicago requires MBA students to make short movies about their
experiences.
Creative Potential Most people have useful creative potential. But to unleash
it, they have to escape the psychological ruts many of us fall into and learn how
to think about a problem in divergent ways.
Exceptional creativity is scarce. We all know of creative geniuses in science
(Albert Einstein), art (Pablo Picasso), and business (Steve Jobs). But what
about the typical individual? Intelligent people and those who score high on
openness to experience (see Chapter 5 ) are more likely to be creative. 80 Other
traits of creative people are independence, self-confidence, risk taking, an
internal locus of control, tolerance for ambiguity, a low need for structure, and
perseverance. 81 Exposure to a variety of cultures can also improve creativity. 82
So taking an international assignment, or even an international vacation, could
jump-start your creative process.
A study of the lifetime creativity of 461 men and women found fewer than
1 percent were exceptionally creative. 83 But 10 percent were highly creative and
about 60 percent were somewhat creative. This reinforces that most of us have
creative potential; we just need to learn to unleash it.
9 Define creativity and discuss
the three-component model
of creativity.
MyManagementLab
For an interactive application of this
topic, check out this chapter’s
simulation activity at
www.mymanagementlab.com.

www.mymanagementlab.com

What About Ethics in Decision Making? 189
Three-Component Model of Creativity What can individuals and
organizations do to stimulate employee creativity? The best answer lies in
the three-component model of creativity , 84 which proposes that individual
creativity essentially requires expertise, creative thinking skills, and intrinsic
task motivation. Studies confirm that the higher the level of each, the higher
the creativity.
Expertise is the foundation for all creative work. Film writer, producer, and di-
rector Quentin Tarantino spent his youth working in a video rental store, where
he built up an encyclopedic knowledge of movies. The potential for creativity is
enhanced when individuals have abilities, knowledge, proficiencies, and similar
expertise in their field of endeavor. You wouldn’t expect someone with mini-
mal knowledge of programming to be very creative as a software engineer.
The second component is creative-thinking skills. This encompasses personal-
ity characteristics associated with creativity, the ability to use analogies, and the
talent to see the familiar in a different light.
A meta-analysis of 102 studies found positive moods increase creativity, but
it depends on what sort of positive mood was considered. 85 Moods such as
happiness that encourage interaction with the world are more conducive to
creativity than passive moods such as calm. This means the common advice
to relax and clear your mind to develop creative ideas may be misplaced. It
would be better to get in an upbeat mood and then frame your work as an
opportunity to have fun and experiment. Negative moods also don’t always
have the same effects on creativity. Passive negative moods such as sadness
doesn’t seem to have much effect, but avoidance-oriented negative moods
such as fear and anxiety decrease creativity. Feeling threatened reduces your
desire to try new activities; risk aversion increases when you’re scared. Active
negative moods, such as anger, however, do appear to enhance creativity,
especially if you are taking your task seriously.
Being around creative others can make us more inspired, especially if
we’re creatively “stuck.” 86 One study found that having “weak ties” to creative
people—knowing them but not well—facilitates creativity because the people
are there as a resource if we need them but not so close as to stunt our own
independent thinking. 87
Analogies allow decision makers to apply an idea from one context to another.
One of the most famous examples was Alexander Graham Bell’s observation that
it might be possible to apply the way the ear operates to his “talking box.” Bell
noticed the bones in the ear are operated by a delicate, thin membrane. He won-
dered why a thicker and stronger membrane shouldn’t be able to move a piece
of steel. From that analogy, the telephone was conceived. Thinking in terms of
analogies is a complex intellectual skill, which helps explain why cognitive ability
is related to creativity. Demonstrating this effect, one study found children who
got high scores on cognitive ability tests at age 13 were significantly more likely to
have made creative achievements in their professional lives 25 years later. 88
Some people develop creative skills because they see problems in a new
way. They’re able to make the strange familiar and the familiar strange. 89 For
instance, most of us think of hens laying eggs. But how many of us have consid-
ered that a hen is only an egg’s way of making another egg?
three-component model of
creativity The proposition that
individual creativity requires expertise,
creative thinking skills, and intrinsic
task motivation.
creativity The ability to produce novel
and useful ideas.

190 CHAPTER 6 Perception and Individual Decision Making
Creative people often love their work, to the point of seeming obsession.
The final component in the three-component model of creativity is intrinsic
task motivation. This is the desire to work on something because it’s interest-
ing, involving, exciting, satisfying, or personally challenging. It’s what turns cre-
ativity potential into actual creative ideas. Environmental stimulants that foster
creativity include a culture that encourages the flow of ideas; fair and construc-
tive judgment of ideas; rewards and recognition for creative work; sufficient
financial, material, and information resources; freedom to decide what work is
to be done and how to do it; a supervisor who communicates effectively, shows
confidence in others, and supports the work group; and work group members
who support and trust each other. 90
International Differences There are no global ethical standards, 91 as contrasts
between Asia and the West illustrate. 92 Because bribery is commonplace in
countries such as China, a Canadian working in China might face a dilemma:
should I pay a bribe to secure business if it is an accepted part of that country’s
culture? A manager of a large U.S. company operating in China once caught
an employee stealing. Following company policy, she fired him and turned him
over to the local authorities. Later, she was horrified to learn the employee had
been summarily executed. 93
Although ethical standards may seem ambiguous in the West, criteria defin-
ing right and wrong are actually much clearer there than in Asia, where few is-
sues are black and white and most are gray. Global organizations must establish
ethical principles for decision makers in countries such as India and China and
modify them to reflect cultural norms if they want to uphold high standards
and consistent practices.
MyManagementLab
Now that you have finished this chapter, go back to www.mymanagementlab.com to continue
practicing and applying the concepts you’ve learned.
Perception Individuals base their behavior not on the way their external
environment actually is but rather on what they see or believe it to be.
● Whether a manager successfully plans and organizes the work of
employees and actually helps them to structure their work more effi-
ciently and effectively is far less important than how employees perceive
the manager’s efforts.
● Employees judge issues such as fair pay, performance appraisals, and
working conditions in very individual ways. To influence productivity, we
need to assess how workers perceive their jobs.
S A L
SELF-ASSESSMENT LIBRARY
How Creative Am I?
In the Self-Assessment Library (available on CD or online), take assessment I.A.5 (How
Creative Am I?).
Summary and Implications for Managers

www.mymanagementlab.com

Summar y and Implications for Managers 191
Checklists Lead to Better Decisions
POINT COUNTERPOINT
C
hecklists work well, except when they don’t.
Checklists have a paradox that makes them of
dubious usefulness: the more complex the decision mak-
ing, ostensibly the more important the checklist. But the more
complex the decision making, the less likely that a checklist
can or should be followed. Checklists can take an impractical
amount of time to follow. Driving an automobile is a routine but
complex process. Do you keep a checklist in your car for every
time you get behind the wheel?
Moreover, by their very nature, complex tasks can pose
problems that fall outside the scope of the checklist. The last
thing we need to solve unanticipated or complicated prob-
lems is rote allegiance to a checklist that is poorly suited to the
problem at hand.
Indeed, a problem with many poor decisions is that heuris-
tics are too often followed, with little thought to whether the
assumptions behind them still hold true. If we have learned
anything from the financial crisis, it is that a model or heuristic
is only as good as its assumptions. Assume housing prices are
properly valued and likely to continue to increase, and it makes
all the sense in the world to be aggressive in making loans.
Countrywide and Fannie Mae had all sorts of rules, protocols,
and checklists they followed in making catastrophically bad
loan decisions.
As for the medical decision making, as another physician
and author, Sandeep Jauhar, noted, advocates of check-
lists often ignore the unintended consequences. Insurers
compensate doctors for ticking off boxes on checklists—like
prescribing antibiotics—even when there is no evidence they
are warranted. Because this protocol encourages the growth
of antibiotic-resistant bacteria, we all are endangered by this
checklist-adhering behavior.
We want to think we live in a world where decision-
making errors can be easily solved. We can mitigate some
decisions by learning more about decision-making errors, but
one of the main learning points is that we need a healthier
respect for the degree to which we’re susceptible to errors.
Checklists provide a false sense of security and an ignorance
about when they cause more problems than they solve.
W
hile life and lives sometimes turn on the basis of big
decisions, it’s often the little ones that matter more.
Our failure to follow routine, everyday protocols
makes the world a more dangerous place for ourselves, and for
others. A few examples . . .
Nearly 100,000 U.S. patients are killed every year by the fail-
ure of doctors and nurses to follow simple instructions. Really.
Hospital-acquired infections kill that many people every year,
and nearly all those deaths are entirely preventable.
Most airline crashes occur because pilots ignore the rules.
Pilot failure to follow protocols is a primary contributing factor
to the majority of incidents and accidents.
An important way of attacking these errors is to use
checklists.
Support for a checklist approach is provided by a new
book, The Checklist Manifesto . In it, the author, Harvard
Medical School surgeon Atul Gawande notes, “The volume and
complexity of what we know has exceeded our ability to deliver
its benefits correctly, safely, or reliably.” Unless, of course, we
use checklists.
Dr. Peter Pronovost, a critical care specialist at Johns
Hopkins, developed his own operating room checklist, which
included some “no brainers” such as wash your hands with
soap, put drapes over entire patient, and put sterile dressing
over incisions. Within 1 year of the checklist’s adoption at Johns
Hopkins, the post-op infection rate went from 11 percent to zero.
According to Gawande, in using checklists to improve
decisions, we should keep the following guidelines in mind:
● Include all “stupid but critical” tasks so they’re not
overlooked.
● Make it mandatory for team members to inform others when
an item on the list is completed (or not).
● Empower team members to question superiors about the
checklist.
● Allow for improvisation in unusual circumstances.
● Thoroughly test-drive the checklist before implementing it.
Gawande notes that checklists aren’t important only for
medical decision making. Engineering, business, technology,
safety, and transportation are all industries that would benefit
from greater development and use of checklists in everyday
decision making.
As a project manager noted, “Successful checklists detail
both the sequence of necessary activities as well as the
communication checkpoints to ensure dialog among project
participants.”
Sources: S. Jauhar, “One Thing After Another,” New York Times Book Review (January 24, 2010), p. 7; C. Arnst, “Make a List.
Check it Twice,” Bloomberg Businessweek (February 22, 2010), pp. 78–79; J. Ross, “The Checklist Manifesto and the Digital
Divide,” Forbes (July 27, 2010), downloaded on May 7, 2011, from www.forbes.com .

www.forbes.com

192 CHAPTER 6 Perception and Individual Decision Making
● Absenteeism, turnover, and job satisfaction are also reactions to an
individual’s perceptions. Dissatisfaction with working conditions and the
belief that an organization lacks promotion opportunities are judgments
based on attempts to create meaning in the job.
● The employee’s conclusion that a job is good or bad is an interpretation.
Managers must spend time understanding how each individual interprets
reality and, when there is a significant difference between what someone
sees and what exists, try to eliminate the distortions.
Individual Decision Making Individuals think and reason before they act. This
is why an understanding of how people make decisions can be helpful for ex-
plaining and predicting their behavior. In some decision situations, people fol-
low the rational decision-making model. But few important decisions are simple
or unambiguous enough for the rational model’s assumptions to apply. So we
find individuals looking for solutions that satisfice rather than optimize, inject-
ing biases and prejudices into the decision process, and relying on intuition.
What can managers do to improve their decision making? We offer four
suggestions.
● Analyze the situation. Adjust your decision-making approach to the national
culture you’re operating in and to the criteria your organization evaluates
and rewards. If you’re in a country that doesn’t value rationality, don’t feel
compelled to follow the rational decision-making model or to try to make
your decisions appear rational. Similarly, organizations differ in the impor-
tance they place on risk, the use of groups, and the like. Adjust your deci-
sion approach to ensure it’s compatible with the organization’s culture.
● Second, be aware of biases. Then try to minimize their impact. Exhibit 6-4
offers some suggestions.
● Third, combine rational analysis with intuition. These are not conflicting
approaches to decision making. By using both, you can actually improve
your decision-making effectiveness. As you gain managerial experience,
you should feel increasingly confident in imposing your intuitive pro-
cesses on top of your rational analysis.
● Finally, try to enhance your creativity. Actively look for novel solutions to
problems, attempt to see problems in new ways, and use analogies. Try to
remove work and organizational barriers that might impede your creativity.
1 What is perception, and what factors influence our
perception?
2 What is attribution theory? What are the three determi-
nants of attribution? What are its implications for explaining
organizational behavior?
3 What shortcuts do people frequently use in making
judgments about others?
4 What is the link between perception and decision
making? How does one affect the other?
5 What is the rational model of decision making? How is it
different from bounded rationality and intuition?
6 What are some of the common decision biases or errors
that people make?
7 What are the influences of individual differences,
organizational constraints, and culture on decision
making?
8 Are unethical decisions more a function of an individual
decision maker or the decision maker’s work environment?
Explain.
9 What is creativity, and what is the three-component
model of creativity?
QUESTIONS FOR REVIEW

Ethical Dilemma 193
EXPERIENTIAL EXERCISE Biases in Decision Making
Step 1
Answer each of the following problems.
1. Fortune magazine ranked the following 10 corpora-
tions among the 500 largest U.S.–based firms accord-
ing to sales volume for 2008:
Group A: Apple Computer, Hershey Foods, Kellogg,
McDonald’s, U.S. Airways
Group B: Altria Group, AmerisourceBergen, Cardinal
Health, McKesson, Valero Energy
Which group would you say had the larger total
sales volume—A or B? By what percentage—10 per-
cent, 50 percent, 100 percent?
2. The best student in your introductory MBA class
this past semester writes poetry and is rather shy
and small in stature. What was the student’s
undergraduate major—Chinese studies or
psychology?
3. Which of the following causes more deaths in the
United States each year?
a. Stomach cancer
b. Motor vehicle accidents
4. Which would you choose?
a. A sure gain of $240
b. A 25 percent chance of winning $1,000 and
a 75 percent chance of winning nothing
5. Which would you choose?
a. A sure loss of $750
b. A 75 percent chance of losing $1,000 and a
25 percent chance of losing nothing
6. Which would you choose?
a. A sure loss of $3,000
b. An 80 percent chance of losing $4,000 and a
20 percent chance of losing nothing
Step 2
Break into groups of three to five students. Compare your
answers. Explain why you chose the answers you did.
Step 3
Your instructor will give you the correct answers to each
problem. Now discuss the accuracy of your decisions, the
biases evident in the decisions you reached, and how you
might improve your decision making to make it more
accurate.
Source: These problems are based on examples provided in M. H. Bazerman, Judgment in Managerial
Decision Making, 3rd ed. (New York: Wiley, 1994).
ETHICAL DILEMMA Do Unethical Decisions Come from Bad Character?
Why would former New York Attorney General and then
Governor Eliot Spitzer decide to use a prostitution ser-
vice? Why would highly respected attorney Marc Dreier,
with degrees from Harvard and Yale and a successful
Park Avenue law firm, decide to impersonate people in
order to swindle others? From Tiger Woods to Bernie
Madoff, it’s not hard to find examples of unethical be-
havior. But what causes people to make unfortunate
choices?
Behavioral genetics research has taught us that virtu-
ally every human characteristic has genetic origins and
that genetic differences are a central reason people differ
in their behavior. Thus, some personality traits probably
predispose people toward unethical behavior. One study
of white-collar criminals, for example, showed they were
significantly lower on a conscientiousness scale than the
general population.
On the other hand, recent research shows that all of
us perform unethical behavior to some degree while
subconsciously fooling ourselves about it. We may bend a
rule to help a colleague, overlook information that might
damage a case we want to make, or lie to avoid a negative
consequence—blithely unaware that others might view
this behavior as unethical.
Why do we do this? Evidence suggests that when we fail
to notice a decision has an ethical component, it enables
us to behave in a self-interested manner without having
to feel badly about it. No wonder, then, that people tend
to believe they are more ethical than they are.
Many think that transparency and accountability in-
crease ethical behavior. Behavioral ethics research, how-
ever, shows us that often these actions increase unethical
behavior, because they cause individuals to think disclo-
sure absolves them of ethical responsibilities to be ob-
jective, or to deny to an even greater degree the ethical
components of their decisions.
The first step toward behaving more ethically is, ironi-
cally, admitting to ourselves that we adhere to ethical stan-
dards less well than we admit.

194 CHAPTER 6 Perception and Individual Decision Making
Questions
1. Do you think people see themselves as more ethical
than they really are? And you?
2. The authors of one study noted that “disclosures can
exacerbate [unethical behavior] by causing people
to feel absolved of their duty to be objective.” Do you
agree? Why or why not?
3. Do you think if we admitted it to ourselves times
when we behaved unethically we would be less likely
to behave unethically in the future?
Sources: M. H. Bazerman and A. E. Tenbrunsel, Blind Spots: Why We Fail to Do What’s Right and What to
Do about It (Princeton, NJ: Princeton University Press, 2011); M. H. Bazerman and A. E. Tenbrunsel,
“Stumbling into Bad Behavior,” The New York Times (April 21, 2011), p. A23); and S. Jayson, “What
Propels Us to Do Bad Things?” USA Today (May 3, 2011), p. 6D.
CASE INCIDENT 1 Computerized Decision Making
As you saw in the opening vignette, computerized decision
making has really taken off in recent years. Some have
blamed the financial crisis that began in 2007–2008 on ex-
cessive reliance on these computerized decision-making
models. Lending officers who used to make individualized
decisions about credit worthiness through personal judg-
ment were replaced by computerized and statistical mod-
els, which resulted in mechanistic decision making. As a
result, large numbers of decisions were tied to a common
set of assumptions, and when those assumptions proved
to be wrong, the entire credit system fell apart and the
economy faltered.
Besides the use of computerized decision models,
the use of computerized systems like Twitter for in-
formation sharing and the burgeoning number of
computer “apps” may be leading to information over-
load, so facts and figures replace analysis and thought
in making human decisions. Eric Kessler from Pace
University’s Lubin School of Business notes, “What
starts driving decisions is the urgent rather than the im-
portant.” Researchers have begun to find that people
using too much information actually make worse deci-
sions than people with less information, or they get so
swamped in information that they are unable to reach
a decision at all.
Computer decision models do present certain advan-
tages. Computers are capable of amassing and compiling
enormous amounts of data and using them to spot trends
and patterns a human observer would simply never see.
Computers also are not prone to emotional decision mak-
ing or falling into the heuristics and biases we discussed
in this chapter. Finally, computerized decision making sys-
tems are generally faster than human beings.
However, computer decision-making systems have cer-
tain faults that might severely constrain their usefulness.
Although computers can grind through masses of data,
they are not capable of intuition or creative thought. As
scholar Amar Bhidé notes, “An innovator cannot sim-
ply rely on historical patterns in placing bets on future
opportunities.” People are much more likely to spot op-
portunities that lie just beyond what the data can tell us
directly. Also, groups of people working in collabora-
tion can discuss and question assumptions and conclu-
sions. Computers cannot actively consider whether their
programming makes sense or adapt automatically when
values change.
Questions
1. What are the specific advantages of using computer-
ized decision making? How can computers be better
decision makers than humans?
2. What are the weaknesses of using computers as
decision tools? Are computers likely to have any
specific problems in making decisions that people
wouldn’t have?
3. Do you think computer decision making systems can
effectively take ethical issues into account? What is
the role of human decision makers in creating ethical
choices?
4. Are there advantages to completely disconnecting
from the wired world when possible? What can you
do to try to retain your ability to focus and process
information deeply?
Sources: Based on S. Begley, “I Can’t Think!” Newsweek (March 7, 2011), www.newsweek.com ; A. Bhidé,
“The Judgment Deficit” Harvard Business Review (September 2010), pp. 44–53; and T. H. Davenport and
J. H. Snabe, “How Fast and Flexible Do You Want Your Information, Really?” Sloan Management Review
52 (Spring 2011), pp. 57–62.

www.newsweek.com

Endnotes 195
CASE INCIDENT 2 Predictions That Didn’t Quite Pan Out
Consider the following examples of predictions:
● Prediction: “More people are going to be put to work
this summer.”— Vice President Joe Biden (June 17, 2010)
● Status: By August, job growth in the private sector
fell by two-thirds and unemployment increased to
9.8 percent in November.
● Prediction: “The market is telling you that something
is not quite right. . . . The Chinese economy is going to
slow down regardless.”—Investment analyst Marc Faber
(May 3, 2010)
● Status: The Chinese economy grew by 9.5 percent over
the rest of the year.
● Prediction: A quick, prepackaged bankruptcy for
General Motors might stall, leading to “a long period
of bankruptcy which I believe would result in liquida-
tion of the company.”—CEO Rick Wagoner (March 17,
2009)
● Status: GM’s bankruptcy court lasted a mere 40 days,
and by September the company held $43 billion in cash.
● Prediction: “My long-term opinion is that the bear mar-
ket has several years left to run, and stock prices will go
a lot lower. . . . So any rally that happens is going to be a
bear market rally.”—Robert Prechter, CEO at research
company Elliot Wave International (February 27, 2009)
● Status: The S&P 500 was up 64 percent from its lowest
point by the middle of December, and stocks have con-
tinued to perform well since.
● Prediction: “I think this is a case where Freddie Mac
(FRE) and Fannie Mae (FNM) are fundamentally
sound. They’re not in danger of going under. . . . I think
they are in good shape going forward.”—Representative
Barney Frank (July 14, 2008)
● Status: Just 2 months later, the mortgage companies
were in conservatorship, and the government had
pledged to invest $100 billion in each.
● Prediction: “I think Bob Steel’s the one guy I trust to
turn this bank around, which is why I’ve told you on
weakness to buy Wachovia.”—CNBC commentator Jim
Cramer (March 11, 2008)
● Status: Investors fled Wachovia within the next 2 weeks,
and the company nearly failed, with shares losing half
their value from September 15 to December 29.
Questions
1. Despite the difficulty of making predictions, many
people confidently make assertions about what will
happen in the future. Why do you think this is?
2. What perceptual or decision-making errors can you
identify in these predictions?
3. Can you think of some predictions you’ve made that
haven’t turned out the way you expected?
4. Why do you think it’s so hard to make accurate
predictions?
Sources: Based on J. E. Keating, “The 10 Worst Predictions for 2010,” Foreign Policy (December 17, 2010),
www.foreignpolicy.com ; P. Coy, “Worst Predictions about 2009,” Bloomberg Businessweek (December 15,
2009), www.businessweek.com ; and P. Coy, “Worst Predictions about 2008,” BusinessWeek (January 12,
2009), pp. 15–16.
ENDNOTES
1. H. H. Kelley, “Attribution in Social Interaction,” in E. Jones
et al. (eds.), Attribution: Perceiving the Causes of Behavior
(Morristown, NJ: General Learning Press, 1972); and
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J. S. Hyde, and B. L. Hankin, “Is There a Universal Positivity

www.foreignpolicy.com

www.businessweek.com

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6. S. Nam, “Cultural and Managerial Attributions for Group
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Endnotes 197
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Endnotes 199
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Little, Brown, 1964).
77. G. F. Cavanagh, D. J. Moberg, and M. Valasquez, “The Ethics
of Organizational Politics,” Academy of Management Journal
(June 1981), pp. 363–374.
78. See, for example, T. Machan, ed., Commerce and Morality
(Totowa, NJ: Rowman and Littlefield, 1988).
79. T. M. Amabile, “A Model of Creativity and Innovation in
Organizations,” in B. M. Staw and L. L. Cummings (eds.),
Research in Organizational Behavior, vol. 10 (Greenwich,
CT: JAI Press, 1988), p. 126; and J. E. Perry-Smith and
C. E. Shalley, “The Social Side of Creativity: A Static and
Dynamic Social Network Perspective,” Academy of Management
Review (January 2003), pp. 89–106.
80. G. J. Feist and F. X. Barron, “Predicting Creativity from Early
to Late Adulthood: Intellect, Potential, and Personality,”
Journal of Research in Personality (April 2003), pp. 62–88.
81. R. W. Woodman, J. E. Sawyer, and R. W. Griffin, “Toward
a Theory of Organizational Creativity,” Academy of
Management Review (April 1993), p. 298; J. M. George
and J. Zhou, “When Openness to Experience and
Conscientiousness Are Related to Creative Behavior: An
Interactional Approach,” Journal of Applied Psychology (June
2001), pp. 513–524; and E. F. Rietzschel, C. K. W. de
Dreu, and B. A. Nijstad, “Personal Need for Structure and
Creative Performance: The Moderating Influence of Fear
of Invalidity,” Personality and Social Psychology Bulletin (June
2007), pp. 855–866.
82. A. K. Leung, W. W. Maddux, A. D. Galinsky, and C. Chiu,
“Multicultural Experience Enhances Creativity,” American
Psychologist 63, no. 3 (2008), pp. 169–180.
83. Cited in C. G. Morris, Psychology: An Introduction, 9th ed.
(Upper Saddle River, NJ: Prentice Hall, 1996), p. 344.
84. This section is based on T. M. Amabile, “Motivating
Creativity in Organizations: On Doing What You Love and
Loving What You Do,” California Management Review 40, no. 1
(Fall 1997), pp. 39–58.
85. M. Baas, C. K. W. De Dreu, and B. A. Nijstad, “A Meta-
Analysis of 25 Years of Mood-Creativity Research: Hedonic
Tone, Activation, or Regulatory Focus?” Psychological Bulletin
134, no. 6 (2008), pp. 779–806.
86. J. Zhou, “When the Presence of Creative Coworkers Is
Related to Creativity: Role of Supervisor Close Monitoring,
Developmental Feedback, and Creative Personality,” Journal
of Applied Psychology 88, no. 3 (June 2003), pp. 413–422.
87. J. E. Perry-Smith, “Social yet Creative: The Role of Social
Relationships in Facilitating Individual Creativity,” Academy
of Management Journal 49, no. 1 (2006), pp. 85–101.
88. G. Park, D. Lubinski, and C. P. Benbow, “Contrasting
Intellectual Patterns Predict Creativity in the Arts
and Sciences,” Psychological Science 18, no. 11 (2007),
pp. 948–952.
89. W. J. J. Gordon, Synectics (New York: Harper & Row, 1961).
90. See C. E. Shalley, J. Zhou, and G. R. Oldham, “The
Effects of Personal and Contextual Characteristics on
Creativity: Where Should We Go from Here?” Journal of
Management (November 2004), pp. 933–958; G. Hirst,
D. Van Knippenberg, and J. Zhou, “A Cross-Level Perspective
on Employee Creativity: Goal Orientation, Team Learning
Behavior, and Individual Creativity,” Academy of Management
Journal 52, no. 2 (2009), pp. 280–293; and C. E. Shalley,
L. L. Gilson, and T. C. Blum, “Interactive Effects of Growth
Need Strength, Work Context, and Job Complexity on Self-
Reported Creative Performance,” Academy of Management
Journal 52, no. 3 (2009), pp. 489–505.
91. T. Jackson, “Cultural Values and Management Ethics:
A 10-Nation Study,” Human Relations (October 2001),
pp. 1267–1302; see also J. B. Cullen, K. P. Parboteeah, and
M. Hoegl, “Cross-National Differences in Managers’
Willingness to Justify Ethically Suspect Behaviors: A Test of
Institutional Anomie Theory,” Academy of Management Journal
(June 2004), pp. 411–421.
92. W. Chow Hou, “To Bribe or Not to Bribe?” Asia, Inc.
(October 1996), p. 104.
93. P. Digh, “Shades of Gray in the Global Marketplace,”
HRMagazine (April 1997), p. 91.

THE MOTIVATIONS OF THE 99ERS
200
W
hile the economy shows signs of improving, the sluggish nature
of the recovery has left behind more long-term unemployed than
anyone has seen since the Great Depression.
Typically, unemployment insurance lasts 6 months. As the great recession
continued, Congress extended these benefits—up to 99 weeks for those in
27 states hit hardest by the recession.
The 99ers are those who have been unemployed more than 99 weeks.
They number about 2 million, and millions more are underemployed or have
withdrawn from the labor market altogether. Among the hardest hit are
older workers who struggle to convince employers to hire them.
St. Louis resident Peter Gordon, 53, has been unemployed more than a
year. Once he becomes a 99er, his unemployment check will run out. “I will
be OK for another 20 weeks,” Gordon said. “But I’m going crazy.” Akron’s
Susan Harrell has been jobless more than 2 years and has exhausted her
unemployment benefits. Laid off from her $60,000/year telecommunications
job, she finds employers unwilling to hire her because she is unemployed, 58,
or both. “They look at me and say, ‘How long are you really going to work?’ ”
Should the government help those in need by extending unemployment
benefits further? The question is complicated and divides Republicans and
Democrats. But put aside ideology for a moment, and consider the motiva-
tional dynamics at play. Many have lost their jobs through no fault of their
own. Not only are unemployment benefits compassionate, they provide an
opportunity for people to retrain for a new occupation. Benefits thus moti-
vate them to move into more viable occupations.
On the other hand, many economists argue that extending benefits
provides disincentives for finding employment. One concludes,
“Unemployment insurance is not free: It results in less employment and less
output, not more.” Paying people not to work gives them incentives not to
work, this argument goes.
Our nation will probably never agree on the motivational effects of
unemployment insurance. However, with or without insurance, there is
troubling evidence that some individuals like Peter Gordon and Susan Harrell
will remain out of work for a very long time. “This is horrible,” says Harrell. “It’s
embarrassing and humiliating.”
Sources: W. M. Welch, “Long-Term Unemployed See Benefits Rolled Back,” USA Today (May 17,
2011), p. A1; D. Hunsinger, Long-Term Unemployed Face Stigmas in Job Search,” USA Today
(January 23, 2011), downloaded May 2, 2011, from www.usatoday.com/money/ ; M. Thornton,
“99ers and the Long-term Unemployed Are the Elephants in the Economic Recovery Room,”
Huffington Post (May 15, 2011), downloaded May 25, 2011, from www.huffingtonpost.com/ ;
C. B. Mulligan, “Do Jobless Benefits Discourage People From Finding Jobs?” New York Times
(March 17, 2010), downloaded May 2, 2011, from http://economix.blogs.nytimes.com/ .
LEARNING
OBJECTIVES
After studying this chapter,
you should be able to:
1 Describe the three key
elements of motivation.
2 Identify early theories of
motivation and evaluate
their applicability today.
3 Apply the predictions of
self-determination theory
to intrinsic and extrinsic
rewards.
4 Understand the impli cations
of employee engagement
for management.
5 Compare and contrast
goal-setting theory and
management by objectives.
6 Contrast reinforcement
theory and goal-setting
theory.
7 Demonstrate how
organizational justice is a
refinement of equity theory.
8 Apply the key tenets of
expectancy theory to
motivating employees.
9 Compare contemporary
theories of motivation.

MyManagementLab
Access a host of interactive
learning aids to help strengthen
your understanding of the
chapter concepts at
www.mymanagementlab.com.

www.mymanagementlab.com

www.usatoday.com/money/

www.huffingtonpost.com/

http://economix.blogs.nytimes.com/

Motivation
Concepts 7
Luke: “I don’t believe it.”
Yoda: “That is why you fail.”
—The Empire Strikes Back
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201

202 CHAPTER 7 Motivation Concepts
D ebates about motivation can occupy a central role in important public policy debates, and as we will see, they also rank among the most important questions managers need to answer.
However, motivation is not simply about working hard—it also reflects your
view of your own abilities. Try a self-assessment of your confidence in your
ability to succeed.
Motivation is one of the most frequently researched topics in OB. 1 A recent
Gallup poll revealed one reason—a majority of U.S. employees (54 percent) are
not actively engaged in their work, and another portion (17 percent) are ac-
tively disengaged. 2 In another study, workers reported wasting roughly 2 hours
per day, not counting lunch and scheduled breaks (usually Internet surfing and
talking with co-workers). 3 Clearly, motivation is an issue. The good news is that
all this research provides useful insights into how to improve it.
In this chapter, we’ll review the basics of motivation, assess motivation
theories, and provide an integrative model that fits the best of these theories
together.
Some individuals seem driven to succeed. But the same student who struggles
to read a textbook for more than 20 minutes may devour a Harry Potter book in a
day. The difference is the situation. So as we analyze the concept of motivation,
keep in mind that the level of motivation varies both between individuals and
within individuals at different times.
We define motivation as the processes that account for an individual’s
intensity, direction, and persistence of effort toward attaining a goal. 4 While
general motivation is concerned with effort toward any goal, we’ll narrow
the focus to organizational goals in order to reflect our singular interest in
work-related behavior.
The three key elements in our definition are intensity, direction, and
persistence. Intensity describes how hard a person tries. This is the element
most of us focus on when we talk about motivation. However, high intensity
is unlikely to lead to favorable job-performance outcomes unless the effort
is channeled in a direction that benefits the organization. Therefore, we con-
sider the quality of effort as well as its intensity. Effort directed toward, and
consistent with, the organization’s goals is the kind of effort we should be seek-
ing. Finally, motivation has a persistence dimension. This measures how long a
person can maintain effort. Motivated individuals stay with a task long enough
to achieve their goal.
1 Describe the three key
elements of motivation.
S A L
SELF-ASSESSMENT LIBRARY
How Confident Am I in My Abilities to Succeed?
In the Self-Assessment Library (available on CD or online), take assessment
IV.A.3 (How Confident Am I in My Abilities to Succeed?) and answer the following
questions.
1. How did you score relative to other class members? Does that surprise you?
2. Do you think self-confidence is critical to success? Can a person be too
confident?
Defining Motivation

Early Theories of Motivation 203
Four theories of employee motivation formulated during the 1950s, although
now of questionable validity, are probably still the best known. We discuss more
valid explanations later, but these four represent a foundation on which they
have grown, and practicing managers still use them and their terminology.
Hierarchy of Needs Theory
The best-known theory of motivation is Abraham Maslow’s hierarchy of needs . 5
Maslow hypothesized that within every human being, there exists a hierarchy of
five needs:
1. Physiological. Includes hunger, thirst, shelter, sex, and other bodily needs.
2. Safety. Security and protection from physical and emotional harm.
3. Social. Affection, belongingness, acceptance, and friendship.
4. Esteem. Internal factors such as self-respect, autonomy, and achievement,
and external factors such as status, recognition, and attention.
5. Self-actualization. Drive to become what we are capable of becoming;
includes growth, achieving our potential, and self-fulfillment.
Although no need is ever fully gratified, a substantially satisfied need no lon-
ger motivates. Thus as each becomes substantially satisfied, the next one becomes
dominant. So if you want to motivate someone, according to Maslow, you need to
understand what level of the hierarchy that person is currently on and focus on
satisfying needs at or above that level, moving up the steps in Exhibit 7-1 .
Maslow separated the five needs into higher and lower orders. Physiological
and safety needs, where the theory says people start, were lower-order needs ,
2 Identify early theories of
motivation and evaluate
their applicability today.
motivation The processes that
account for an individual’s intensity,
direction, and persistence of effort
toward attaining a goal.
hierarchy of needs Abraham Maslow’s
hierarchy of five needs—physiological,
safety, social, esteem, and self-
actualization—in which, as each need
is substantially satisfied, the next need
becomes dominant.
lower-order needs Needs that
are satisfied externally, such as
physiological and safety needs.
Early Theories of Motivation
Maslow’s Hierarchy of Needs Exhibit 7-1
Source: A. H. Maslow, Motivation and Personality, 3rd ed., R. D. Frager and J. Fadiman (eds.). © 1997. Adapted by permission of
Pearson Education, Inc., Upper Saddle River, New Jersey.

204 CHAPTER 7 Motivation Concepts
and social, esteem, and self-actualization were higher-order needs . Higher-order
needs are satisfied internally (within the person), whereas lower-order needs are
predominantly satisfied externally (by things such as pay, union contracts, and
tenure).
The hierarchy, if it applies at all, aligns with U.S. culture. In Japan, Greece,
and Mexico, where uncertainty-avoidance characteristics are strong, security
needs would be on top of the hierarchy. Countries that score high on nurturing
characteristics—Denmark, Sweden, Norway, the Netherlands, and Finland—
would have social needs on top. 6 Group work will motivate employees more
when the country’s culture scores high on the nurturing criterion.
Maslow’s theory has received wide recognition, particularly among practic-
ing managers. It is intuitively logical and easy to understand. When introduced,
it provided a compelling alternative to behaviorist theories that posited only
physiological and safety needs as important. Unfortunately, however, research
does not validate it. Maslow provided no empirical substantiation, and several
studies that sought to validate it found no support for it. 7 There is little evidence
that need structures are organized as Maslow proposed, that unsatisfied needs
motivate, or that a satisfied need activates movement to a new need level. 8 But
old theories, especially intuitively logical ones, apparently die hard.
Some researchers have attempted to revive components of the need hier-
archy concept, using principles from evolutionary psychology. 9 They propose
that lower-level needs are the chief concern of immature animals or those
with primitive nervous systems, whereas higher needs are more frequently
observed in mature animals with more developed nervous systems. They also
note distinct underlying biological systems for different types of needs. Time
will tell whether these revisions to Maslow’s hierarchy will be useful to practic-
ing managers.
S
urprisingly, this statement appears
to be false.
There is some research on how
team goals facilitate team performance.
However, until recently, we knew very
little about whether others help or hinder
our individual chances of meeting a goal.
Generally, whether it’s reaching a
weight loss goal, successfully com-
pleting an undergraduate course, or
completing a work task, help and
support from others actually appears
to hinder our chances and make us
feel worse rather than better.
Why? First, research has found that
help is often, well, unhelpful. Advice
and direction from others is seldom
well suited for accomplishing our
goal. If you’re trying to meet a work
deadline using your approach, it’s not
often useful for a co-worker to advise
you to use his or her method instead.
Second, such advice and assistance
generally makes us feel less confident
and positive about achieving the goal.
The more help is offered, the more
negative feelings and stress we have
about the goal.
The upshot? Generally, you’ll do a
better job of meeting your individual
work goals if you “just do it” by your-
self. Of course, sometimes you do
need the help of others. But keep that
help focused on specific questions
and not on advice for attaining the
general goal.
Sources: H. B. Kappes and P. E. Shrout,
“When Goal Sharing Produces Support
That Is Not Caring,” Personality and Social
Psychology Bulletin 37, no. 5 (2011),
pp. 662–673; P. E. Shrout, N. Bolger,
M. Iida, C. Burke, M. E. Gleason, and
S. P. Lane, “The Effects of Daily Support
Transactions During Acute Stress:
Results from a Diary Study of Bar Exam
Preparation,” in K. Sullivan and J. Davila
(Eds.), Support Processes in Intimate
Relationships (New York: Oxford University
Press, 2010), pp. 175–199.
Myth or Science?
“The Support of Others Improves Our Chances
of Accomplishing Our Goals”

Early Theories of Motivation 205
Theory X The assumption that
employees dislike work, are lazy,
dislike responsibility, and must be
coerced to perform.
two-factor theory A theory that relates
intrinsic factors to job satisfaction
and associates extrinsic factors with
dissatisfaction. Also called motivation-
hygiene theory.
hygiene factors Factors—such as
company policy and administration,
supervision, and salary—that, when
adequate in a job, placate workers.
When these factors are adequate,
people will not be dissatisfied.
Theory X and Theory Y
Douglas McGregor proposed two distinct views of human beings: one basically
negative, labeled Theory X, and the other basically positive, labeled Theory Y. 10
After studying managers’ dealings with employees, McGregor concluded that
their views of the nature of human beings are based on certain assumptions
that mold their behavior.
Under Theory X , managers believe employees inherently dislike work and must
therefore be directed or even coerced into performing it. Under Theory Y , in con-
trast, managers assume employees can view work as being as natural as rest or play,
and therefore the average person can learn to accept, and even seek, responsibility.
To understand more fully, think in terms of Maslow’s hierarchy. Theory Y
assumes higher-order needs dominate individuals. McGregor himself believed
Theory Y assumptions were more valid than Theory X. Therefore, he proposed
such ideas as participative decision making, responsible and challenging jobs,
and good group relations to maximize an employee’s job motivation.
Unfortunately, no evidence confirms that either set of assumptions is valid
or that acting on Theory Y assumptions will lead to more motivated workers.
OB theories need empirical support before we can accept them. Theory X and
Theory Y lack such support as much as the hierarchy of needs.
Two-Factor Theory
Believing an individual’s relationship to work is basic, and that attitude toward
work can determine success or failure, psychologist Frederick Herzberg won-
dered, “What do people want from their jobs?” He asked people to describe,
in detail, situations in which they felt exceptionally good or bad about their
jobs. The responses differed significantly and led Hertzberg to his two-factor
theory —also called motivation-hygiene theory. 11
As shown in Exhibit 7-2 , intrinsic factors such as advancement, recognition,
responsibility, and achievement seem related to job satisfaction. Respondents
who felt good about their work tended to attribute these factors to them-
selves, while dissatisfied respondents tended to cite extrinsic factors, such as
supervision, pay, company policies, and working conditions.
To Hertzberg, the data suggest that the opposite of satisfaction is not
dissatisfaction, as was traditionally believed. Removing dissatisfying character-
istics from a job does not necessarily make the job satisfying. As illustrated in
Exhibit 7-3 , Herzberg proposed a dual continuum: The opposite of “satisfaction”
is “no satisfaction,” and the opposite of “dissatisfaction” is “no dissatisfaction.”
According to Herzberg, the factors that lead to job satisfaction are sepa-
rate and distinct from those that lead to job dissatisfaction. Therefore, manag-
ers who seek to eliminate factors that can create job dissatisfaction may bring
about peace, but not necessarily motivation. They will be placating rather than
motivating their workers. As a result, Herzberg characterized conditions such
as quality of supervision, pay, company policies, physical working conditions,
relationships with others, and job security as hygiene factors . When they’re
Theory Y The assumption that
employees like work, are creative, seek
responsibility, and can exercise self-
direction.
self-actualization The drive to
become what a person is capable of
becoming.
higher-order needs Needs that are
satisfied internally, such as social,
esteem, and self-actualization needs.

206 CHAPTER 7 Motivation Concepts
Contrasting View of Satisfaction and Dissatisfaction Exhibit 7-3
Satisfaction
Traditional view
Herzberg’s view
Dissatisfaction
Satisfaction No satisfaction
No dissatisfaction Dissatisfaction
Satisfaction Dissatisfaction
No dissatisfaction Dissatisfaction
Satisfaction No satisfaction
Motivators
Hygiene factors
adequate, people will not be dissatisfied; neither will they be satisfied. If we
want to motivate people on their jobs, Herzberg suggested emphasizing factors
associated with the work itself or with outcomes directly derived from it, such
as promotional opportunities, personal growth opportunities, recognition,
responsibility, and achievement. These are the characteristics people find
intrinsically rewarding.
Comparison of Satisfiers and Dissatisfiers Exhibit 7-2
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
A
ch
ie
ve
m
en
t
Re
co
gn
iti
on
W
or
k
Its
el
f
Re
sp
on
si
bi
lit
y
A
dv
an
ce
m
en
t
G
ro
w
th
Factors characterizing 1,753
events on the job that lead to
extreme satisfaction
0%
5%
10%
15%
20%
25%
30%
35%
40%
Po
lic
y
an
d
ad
m
in
is
tra
tio
n
Su
pe
rv
is
io
n
Re
la
tio
ns
hi
p
w
ith
su
pe
rv
is
or
W
or
k
co
nd
iti
on
s
Sa
la
ry
Re
la
tio
ns
hi
p
w
ith
p
ee
rs
Factors characterizing 1,844
events on the job that lead to
extreme dissatisfaction
Source: Based on Harvard Business Review. “Comparison of Satisfiers and Dissatisfiers.” An exhibit from One More Time: How Do You
Motivate Employees? by Frederick Herzberg, January 2003. Copyright © 2003 by the Harvard Business School Publishing Corporation.
All rights reserved.

Early Theories of Motivation 207
The two-factor theory has not been well supported in the literature, and it
has many detractors. 12 Criticisms include the following:
1. Herzberg’s methodology is limited because it relies on self-reports. When
things are going well, people tend to take credit. Contrarily, they blame
failure on the extrinsic environment.
2. The reliability of Herzberg’s methodology is questionable. Raters have to
make interpretations, so they may contaminate the findings by interpreting
one response in one manner while treating a similar response differently.
3. No overall measure of satisfaction was utilized. A person may dislike part of
a job yet still think the job is acceptable overall.
4. Herzberg assumed a relationship between satisfaction and productivity,
but he looked only at satisfaction. To make his research relevant, we must
assume a strong relationship between satisfaction and productivity.
Regardless of the criticisms, Herzberg’s theory has been widely read, and few
managers are unfamiliar with its recommendations.
McClelland’s Theory of Needs
You have one beanbag and five targets set up in front of you, each farther away
than the last. Target A sits almost within arm’s reach. If you hit it, you get $2.
Target B is a bit farther out, but about 80 percent of the people who try can hit
it. It pays $4. Target C pays $8, and about half the people who try can hit it. Very
few people can hit Target D, but the payoff is $16 for those who do. Finally,
Target E pays $32, but it’s almost impossible to achieve. Which would you try
for? If you selected C, you’re likely to be a high achiever. Why? Read on.
McClelland’s theory of needs was developed by David McClelland and his
associates. 13 It looks at three needs:
● Need for achievement (nAch) is the drive to excel, to achieve in
relationship to a set of standards.
● Need for power (nPow) is the need to make others behave in a way they
would not have otherwise.
● Need for affiliation (nAff) is the desire for friendly and close interpersonal
relationships.
McClelland and subsequent researchers focused most of their attention
on nAch. High achievers perform best when they perceive their probability
of success as 0.5—that is, a 50–50 chance. They dislike gambling with high
odds because they get no achievement satisfaction from success that comes
by pure chance. Similarly, they dislike low odds (high probability of success)
because then there is no challenge to their skills. They like to set goals that
require stretching themselves a little.
Relying on an extensive amount of research, we can predict some
relationships between achievement need and job performance. First, when jobs
have a high degree of personal responsibility and feedback and an intermedi-
ate degree of risk, high achievers are strongly motivated. They are successful in
McClelland’s theory of needs A theory
that states achievement, power, and
affiliation are three important needs
that help explain motivation.
need for achievement (nAch) The drive
to excel, to achieve in relationship
to a set of standards, and to strive to
succeed.
need for power (nPow) The need
to make others behave in a way in
which they would not have behaved
otherwise.
need for affiliation (nAff) The desire
for friendly and close interpersonal
relationships.
As a high achiever, Patricia Woertz
is motivated by work that demands
a high degree of personal responsi-
bility. Today, she is the CEO, presi-
dent, and chair of Archer Daniels
Midland, an agricultural food
processing business. She started her
career as a certified public accoun-
tant but was attracted to the com-
plexity and opportunity of global
energy. For the next 30 years she
worked for Gulf Oil and Chevron in
refining, marketing, strategic plan-
ning, and finance positions. Since
joining ADM, Woertz continues to
shift company resources toward fuel
production in a drive to accelerate
ADM’s global leadership in bioen-
ergy and has led the company to
record financial results.
So
u
rc
e
:
Se
th
W
e
n
ig
/A
P
I
m
a
g
e
s

208 CHAPTER 7 Motivation Concepts
entrepreneurial activities such as running their own businesses, for example,
and managing self-contained units within large organizations. 14 Second, a high
need to achieve does not necessarily make someone a good manager, especially
in large organizations. People with a high achievement need are interested in
how well they do personally, and not in influencing others to do well. High-
nAch salespeople do not necessarily make good sales managers, and the good
general manager in a large organization does not typically have a high need
to achieve. 15 Third, needs for affiliation and power tend to be closely related
to managerial success. The best managers are high in their need for power
and low in their need for affiliation. 16 In fact, a high power motive may be a
requirement for managerial effectiveness. 17
The view that a high achievement need acts as an internal motivator presup-
poses two U.S. cultural characteristics—willingness to accept a moderate degree
of risk (which excludes countries with strong uncertainty-avoidance character-
istics) and concern with performance (which applies to countries with strong
achievement characteristics). This combination is found in Anglo-American
countries such as the United States, Canada, and Great Britain 18 and much less
in Chile and Portugal.
Among the early theories of motivation, McClelland’s has had the best
research support. Unfortunately, it has less practical effect than the others.
Because McClelland argued that the three needs are subconscious—we may
rank high on them but not know it—measuring them is not easy. In the most
common approach, a trained expert presents pictures to individuals, asks
them to tell a story about each, and then scores their responses in terms of the
three needs. However, the process is time consuming and expensive, and few
organizations have been willing to invest in measuring McClelland’s concept.
Early theories of motivation either have not held up under close examination
or have fallen out of favor. In contrast, contemporary theories have one thing
in common: each has a reasonable degree of valid supporting documentation.
This doesn’t mean they are unquestionably right. We call them “contemporary
theories” because they represent the current state of thinking in explaining
employee motivation.
Self-Determination Theory
“It’s strange,” said Marcia. “I started work at the Humane Society as a volunteer.
I put in 15 hours a week helping people adopt pets. And I loved coming to
work. Then, 3 months ago, they hired me full-time at $11 an hour. I’m doing
the same work I did before. But I’m not finding it nearly as much fun.”
Does Marcia’s reaction seem counterintuitive? There’s an explanation for
it. It’s called self-determination theory , which proposes that people prefer
to feel they have control over their actions, so anything that makes a previ-
ously enjoyed task feel more like an obligation than a freely chosen activity will
undermine motivation. 19 Much research on self-determination theory in OB
has focused on cognitive evaluation theory , which hypothesizes that extrinsic
rewards will reduce intrinsic interest in a task. When people are paid for work,
it feels less like something they want to do and more like something they have
to do. Self-determination theory also proposes that in addition to being driven
3 Apply the predictions of
self-determination theory
to intrinsic and extrinsic
rewards.
Contemporary Theories of Motivation

Contemporary Theories of Motivation 209
by a need for autonomy, people seek ways to achieve competence and positive
connections to others. A large number of studies support self-determination
theory. 20 As we’ll show, its major implications relate to work rewards.
When organizations use extrinsic rewards as payoffs for superior
performance, employees feel they are doing a good job less because of their
own intrinsic desire to excel than because that’s what the organization wants.
Eliminating extrinsic rewards can also shift an individual’s perception of why
she works on a task from an external to an internal explanation. If you’re read-
ing a novel a week because your English literature instructor requires you to,
you can attribute your reading behavior to an external source. However, if you
find yourself continuing to read a novel a week after the course is over, your
natural inclination is to say, “I must enjoy reading novels because I’m still
reading one a week.”
Studies examining how extrinsic rewards increased motivation for some
creative tasks suggest we might need to place cognitive evaluation theory’s
predictions in a broader context. 21 Goal-setting is more effective in improving
T
he popular press often reports
about ethical lapses in business
by focusing on employees and
managers who are “loose cannons,”
deviating from organizational rules and
norms to produce bad consequences
for society and business. However,
sometimes unethical behavior is not
just ignored by organizational leaders
but actively encouraged by the com-
pany’s motivational structures. In fact,
one survey found that 56 percent of
U.S. workers experience pressure from
their superiors to behave in an unethi-
cal manner. Craig E. Johnson sums up
the problem, noting, “Examine nearly
any corporate scandal—AIG Insurance,
Arthur Andersen, Enron, Health South,
Sotheby’s Auction House, Fannie
Mae, Hollinger International, Marsh &
McLennan, Quest—and you’ll find
leaders who engaged in immoral
behavior and encouraged their follow-
ers to do the same.”
How do managers create pressure
to behave unethically? Management
scholar Ben Tepper notes that struc-
tures in place in organizations often en-
courage unethical behavior. Incentives
might go to individuals who maxi-
mize sales without regard to whether
they achieved these ends honestly.
Lawyers often are paid in such a way
that tacitly encourages them to over-
bill their clients. Or perhaps rewards
might be offered for producing prod-
ucts at low cost without considering
the social and environmental impacts
of production decisions. In all these
cases, the reward systems in place
in organizations can serve to motivate
unethical behavior.
So what can you do as a man-
ager or employee to confront these
powerful motivations to behave un-
ethically? First and foremost, decision
makers should consider the unintended
consequences of reward systems.
Second, top management should fos-
ter an organizational culture of honesty
and fair dealing and disseminate it
through all levels of the organizational
hierarchy. Finally, organizations might
even consider finding ways to explicitly
reward those employees who engage
in “above and beyond” instances of
ethical behavior.
Sources: B. J. Tepper, “When Managers
Pressure Employees to Behave Badly:
Toward a Comprehensive Response,”
Business Horizons 53, no. 6 (2010),
pp. 591–598; C. E. Johnson, Meeting the
Ethical Challenges of Leadership: Casting
Light or Shadow, 3rd ed. (San Francisco:
Sage, 2009).
An Ethical Choice
Motivated to Behave Unethically
self-determination theory A theory of
motivation that is concerned with the
beneficial effects of intrinsic motivation
and the harmful effects of extrinsic
motivation.
cognitive evaluation theory A version
of self-determination theory which
holds that allocating extrinsic rewards
for behavior that had been previously
intrinsically rewarding tends to
decrease the overall level of motivation
if the rewards are seen as controlling.

210 CHAPTER 7 Motivation Concepts
motivation, for instance, when we provide rewards for achieving the goals.
The original authors of self-determination theory acknowledge that extrinsic
rewards such as verbal praise and feedback about competence can improve
even intrinsic motivation under specific circumstances. Deadlines and specific
work standards do, too, if people believe they are in control of their behavior. 22
This is consistent with the central theme of self-determination theory: rewards
and deadlines diminish motivation if people see them as coercive.
What does self-determination theory suggest for providing rewards? If a
senior sales representative really enjoys selling and making the deal, a commis-
sion indicates she’s been doing a good job and increases her sense of compe-
tence by providing feedback that could improve intrinsic motivation. On the
other hand, if a computer programmer values writing code because she likes
to solve problems, a reward for working to an externally imposed standard she
does not accept, such as writing a certain number of lines of code every day,
could feel coercive, and her intrinsic motivation would suffer. She would be less
interested in the task and might reduce her effort.
A recent outgrowth of self-determination theory is self-concordance ,
which considers how strongly peoples’ reasons for pursuing goals are consis-
tent with their interests and core values. If individuals pursue goals because of
an intrinsic interest, they are more likely to attain their goals and are happy
even if they do not. Why? Because the process of striving toward them is fun.
In contrast, people who pursue goals for extrinsic reasons (money, status, or
other benefits) are less likely to attain their goals and less happy even when
they do. Why? Because the goals are less meaningful to them. 23 OB research
suggests that people who pursue work goals for intrinsic reasons are more
satisfied with their jobs, feel they fit into their organizations better, and may
perform better. 24
What does all this mean? For individuals, it means choose your job for rea-
sons other than extrinsic rewards. For organizations, it means managers should
provide intrinsic as well as extrinsic incentives. They need to make the work
M
uch of the research we have
presented on needs for auton-
omy and self-determination
has been conducted in the United
States and Canada, two countries that
place a high value on personal inde-
pendence and freedom of choice. But
some researchers question whether
a need for autonomy is universal
or whether some cultures foster a
greater need for relatedness.
Some research does suggest
universal needs for autonomy, while
other studies find that different cultures
see autonomy differently. In a survey
of 40 nations, collectivistic countries
valued social order, obedience, and
respect for tradition more, and within
cultures, individuals who value auton-
omy tend to put less value on social
connectedness and vice versa.
In a study with Chinese Canadian
and European Canadian participants,
those from Chinese culture expressed
lower levels of autonomy, but auton-
omy was related to well-being for both
Chinese and European respondents.
Although different cultures view their
autonomy differently, it appears peo-
ple across cultures are higher in well-
being when they perceive they have
freedom of choice.
Sources: C. Vauclair, K. Hanke, R. Fischer,
and J. Fontaine, “The Structure of Human
Values at the Culture Level: A Meta-Analytical
Replication of Schwartz’s Value Orientations
Using the Rokeach Value Survey,” Journal of
Cross-Cultural Psychology 42, no. 2 (2011),
pp. 186–205; and D. Rudy, K. M. Sheldon,
T. Awong, and H. H. Tan, “Autonomy,
Culture, and Well-Being: The Benefits of
Inclusive Autonomy,” Journal of Research in
Personality 41, no. 5 (2007), pp. 983–1007.
glOBalization!
Autonomy Needs Around the Globe

interesting, provide recognition, and support employee growth and develop-
ment. Employees who feel what they do is within their control and a result of
free choice are likely to be more motivated by their work and committed to
their employers. 25
Job Engagement
When nurse Melissa Jones comes to work, it seems that everything else in her
life goes away, and she becomes completely absorbed in what she is doing. Her
emotions, her thoughts, and her behavior are all directed toward patient care.
In fact, she can get so caught up in her work that she isn’t even aware of how
long she’s been there. As a result of this total commitment, she is more effective
in providing patient care and feels uplifted by her time at work.
Melissa has a high level of job engagement , the investment of an employee’s
physical, cognitive, and emotional energies into job performance. 26 Practicing
managers and scholars alike have lately become interested in facilitating job
engagement, believing something deeper than liking a job or finding it inter-
esting drives performance. Many studies attempt to measure this deeper level
of commitment.
The Gallup organization has been using 12 questions to assess the extent to
which employee engagement is linked to positive work outcomes for millions
of employees over the past 30 years. 27 There are far more engaged employ-
ees in highly successful than in average organizations, and groups with more
engaged employees have higher levels of productivity, fewer safety incidents,
and lower turnover. Academic studies have also found positive outcomes. One
examined multiple business units for their level of engagement and found a
Contemporary Theories of Motivation 211
self-concordance The degree to
which peoples’ reasons for pursuing
goals are consistent with their interests
and core values.
job engagement The investment of
an employee’s physical, cognitive,
and emotional energies into job
performance.
More Employees Are Disengaged Than Engaged
by Their JobsOB Poll
Actively disengaged Disengaged Engaged Actively engaged
Degree to which employee is engaged by his/her job
40
35
30
25
20
15
10
5
0
Source: A. Fox, “Raising Engagement,” HR Magazine (May 2010), pp. 35–40; “Gallup’s Customer Engagement Index”
(March 11, 2010), www.smartKPIs.com .

www.smartKPIs.com

212 CHAPTER 7 Motivation Concepts
positive relationship with a variety of practical outcomes. 28 Another reviewed
91 distinct investigations and found higher levels of engagement associated
with task performance and citizenship behavior. 29
What makes people more likely to be engaged in their jobs? One key is the
degree to which an employee believes it is meaningful to engage in work. This
is partially determined by job characteristics and access to sufficient resources
to work effectively. 30 Another factor is a match between the individual’s values
and those of the organization. 31 Leadership behaviors that inspire workers to
a greater sense of mission also increase employee engagement. 32
One of the critiques of engagement is that the construct is partially
redundant with job attitudes like satisfaction or stress. 33 However, engagement
questionnaires usually assess motivation and absorption in a task, quite unlike
job satisfaction questionnaires. Engagement may also predict important work
outcomes better than traditional job attitudes. 34 Other critics note there may
be a “dark side” to engagement, as evidenced by positive relationships between
engagement and work–family conflict. 35 Individuals might grow so engaged in
their work roles that family responsibilities become an unwelcome intrusion.
Further research exploring how engagement relates to these negative outcomes
may help clarify whether some highly engaged employees might be getting “too
much of a good thing.”
Goal-Setting Theory
Gene Broadwater, coach of the Hamilton High School cross-country team,
gave his squad these last words before they approached the starting line for the
league championship race: “Each one of you is physically ready. Now, get out
there and do your best. No one can ever ask more of you than that.”
You’ve heard the sentiment a number of times yourself: “Just do your best.
That’s all anyone can ask.” But what does “do your best” mean? Do we ever
know whether we’ve achieved that vague goal? Would the cross-country runners
have recorded faster times if Coach Broadwater had given each a specific goal?
Research on goal-setting theory in fact reveals impressive effects of goal specific-
ity, challenge, and feedback on performance.
In the late 1960s, Edwin Locke proposed that intentions to work toward a
goal are a major source of work motivation. 36 That is, goals tell an employee
what needs to be done and how much effort is needed. 37 Evidence strongly
suggests that specific goals increase performance; that difficult goals, when
accepted, result in higher performance than do easy goals; and that feedback
leads to higher performance than does nonfeedback. 38
Specific goals produce a higher level of output than the generalized goal
“do your best.” Why? Specificity itself seems to act as an internal stimulus. When
a trucker commits to making 12 round-trip hauls between Toronto and Buffalo,
New York, each week, this intention gives him a specific objective to attain.
All things being equal, he will outperform a counterpart with no goals or the
generalized goal “do your best.”
If factors such as acceptance of the goals are held constant, the more difficult
the goal, the higher the level of performance. Of course, it’s logical to assume
easier goals are more likely to be accepted. But once a hard task is accepted, we
can expect the employee to exert a high level of effort to try to achieve it.
But why are people motivated by difficult goals? 39 First, challenging goals get
our attention and thus tend to help us focus. Second, difficult goals energize
us because we have to work harder to attain them. Do you study as hard for an
easy exam as you do for a difficult one? Probably not. Third, when goals are dif-
ficult, people persist in trying to attain them. Finally, difficult goals lead us to
discover strategies that help us perform the job or task more effectively. If we
4 Understand the implications
of employee engagement
for management.

Contemporary Theories of Motivation 213
have to struggle to solve a difficult problem, we often think of a better way to
go about it.
People do better when they get feedback on how well they are progressing
toward their goals, because it helps identify discrepancies between what they
have done and what they want to do—that is, feedback guides behavior. But all
feedback is not equally potent. Self-generated feedback—with which employ-
ees are able to monitor their own progress—is more powerful than externally
generated feedback. 40
If employees can participate in the setting of their own goals, will they
try harder? The evidence is mixed. 41 In some cases, participatively set goals
yielded superior performance; in others, individuals performed best when as-
signed goals by their boss. But a major advantage of participation may be that
it increases acceptance of the goal as a desirable one toward which to work. 42
Commitment is important. Without participation, the individual assigning the
goal needs to clearly explain its purpose and importance. 43
In addition to feedback, three other factors influence the goals– performance
relationship: goal commitment, task characteristics, and national culture.
Goal-setting theory assumes an individual is committed to the goal and de-
termined not to lower or abandon it. The individual (1) believes he or she
can achieve the goal and (2) wants to achieve it. 44 Goal commitment is most
likely to occur when goals are made public, when the individual has an internal
locus of control (see Chapter 4 ), and when the goals are self-set rather than
assigned. 45 Goals themselves seem to affect performance more strongly when
tasks are simple rather than complex, well learned rather than novel, and inde-
pendent rather than interdependent. 46 On interdependent tasks, group goals
are preferable.
Finally, setting specific, difficult, individual goals may have different ef-
fects in different cultures. Most goal-setting research has been done in the
United States and Canada, where individual achievement and performance
are most highly valued. To date, research has not shown that group-based
goal-setting theory A theory that says
that specific and difficult goals, with
feedback, lead to higher performance.
Chung Mong-koo, chairman of
Hyundai Motor Company, is well
known for articulating difficult
and specific goals as a potent
motivating force. For example,
although Hyundai was a latecomer
in the development of a hybrid
vehicle, the South Korean auto-
maker launched its first U.S.
hybrid in 2010, with annual sales
set at 50,000 units. By 2018, the
company expects hybrid sales to
balloon to 500,000 units worldwide.
Challenging employees to reach
high goals has helped Hyundai
experience tremendous growth in
recent years.
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214 CHAPTER 7 Motivation Concepts
goals are more effective in collectivists than in individualist cultures. In
collectivistic and high-power-distance cultures, achievable moderate goals
can be more highly motivating than difficult ones. 47 Finally, assigned goals
appear to generate greater goal commitment in high than in low power-
distance cultures. 48 More research is needed to assess how goal constructs
might differ across cultures.
Although goal-setting has positive outcomes, some goals may be too ef-
fective. 49 When learning something is important, goals related to perfor-
mance undermine adaptation and creativity because people become too
focused on outcomes and ignore changing conditions. In this case, a goal
to learn and generate alternative solutions will be more effective than a
goal to perform. Some authors argue that goals can lead employees to focus
on a single standard and exclude all others. Consider the narrow focus on
boosting short-term stock prices in many businesses—it may have led orga-
nizations to ignore long-term success and even to engage in such unethical
behavior as accounting fraud or excessively risky investments. (Of course,
organizations can establish goals for ethical performance.) Other studies
show that employees low in conscientiousness and emotional stability expe-
rience greater emotional exhaustion when their leaders set goals. 50 Despite
differences of opinion, most researchers do agree that goals are powerful in
shaping behavior. Managers should make sure they are actually aligned with
the company’s objectives.
Research has begun to examine subconscious goals—that is, goals we
are not even aware of setting. 51 One study primed people to think about
goals by having them assemble scrambled words into sentences with achieve-
ment themes, while other people assembled sentences without achievement
themes. The people who made the achievement sentences were subcon-
sciously primed. That might not sound like a very strong manipulation, but
this group performed more effectively in a brainstorming task than those
given easier goals. Another study found similar results when a picture of a
woman winning a race was the subconscious prime rather than assembling
sentences. Interestingly, these studies do not find that conscious and sub-
conscious goal-setting are related.
S A L
SELF-ASSESSMENT LIBRARY
What Are My Course Performance Goals?
In the Self-Assessment Library (available on CD or online), take assessment I.C.5
(What Are My Course Performance Goals?).
Implementing Goal-Setting As a manager, how do you make goal-setting
theory operational? That’s often left up to the individual. Some managers
set aggressive performance targets—what General Electric called “stretch
goals.” Some CEOs, such as Procter & Gamble’s A. G. Lafley and SAP AG’s
Hasso Plattner, are known for the demanding performance goals they
set. But many managers don’t set goals. When asked whether their job
had clearly defined goals, only a minority of employees in a recent survey
said yes. 52
A more systematic way to utilize goal-setting is with management by
objectives (MBO) , which emphasizes participatively set goals that are tan-
gible, verifiable, and measurable. As in Exhibit 7-4 , the organization’s over-
all objectives are translated into specific objectives for each level (divisional,

Contemporary Theories of Motivation 215
departmental, individual). But because lower-unit managers jointly partici-
pate in setting their own goals, MBO works from the bottom up as well as
from the top down. The result is a hierarchy that links objectives at one level
to those at the next. And for the individual employee, MBO provides specific
personal performance objectives.
Four ingredients are common to MBO programs: goal specificity, participa-
tion in decision making (including the setting of goals or objectives), an explicit
time period, and performance feedback. 53 Many elements in MBO programs
match propositions of goal-setting theory. For example, having an explicit time
period to accomplish objectives matches goal-setting theory’s emphasis on goal
specificity. Similarly, we noted earlier that feedback about goal progress is a
critical element of goal-setting theory. The only area of possible disagreement
between MBO and goal-setting theory is participation: MBO strongly advocates
it, whereas goal-setting theory demonstrates that managers’ assigned goals are
usually just as effective.
You’ll find MBO programs in many business, health care, educational, gov-
ernment, and nonprofit organizations. 54 Their popularity does not mean they
always work. 55 When MBO fails, the culprits tend to be unrealistic expectations,
lack of commitment by top management, and inability or unwillingness to
allocate rewards based on goal accomplishment.
Self-Efficacy Theory
Self-efficacy (also known as social cognitive theory or social learning theory ) refers
to an individual’s belief that he or she is capable of performing a task. 56 The
higher your self-efficacy, the more confidence you have in your ability to suc-
ceed. So, in difficult situations, people with low self-efficacy are more likely to
lessen their effort or give up altogether, while those with high self-efficacy will
Cascading of Objectives Exhibit 7-4
Overall
organizational
objectives
Divisional
objectives
Departmental
objectives
Individual
objectives
XYZ Company
Industrial products divisionConsumer products division
Production Sales Marketing Research Development
Customer
service
management by objectives (MBO) A
program that encompasses specific
goals, participatively set, for an explicit
time period, with feedback on goal
progress.
self-efficacy An individual’s belief
that he or she is capable of performing
a task.

216 CHAPTER 7 Motivation Concepts
try harder to master the challenge. 57 Self-efficacy can create a positive spiral in
which those with high efficacy become more engaged in their tasks and then,
in turn, increase performance, which increases efficacy further. 58 Changes in
self-efficacy over time are related to changes in creative performance as well. 59
Individuals high in self-efficacy also seem to respond to negative feedback with
increased effort and motivation, while those low in self-efficacy are likely to
lessen their effort after negative feedback. 60 How can managers help their em-
ployees achieve high levels of self- efficacy? By bringing goal-setting theory and
self-efficacy theory together.
Goal-setting theory and self-efficacy theory don’t compete; they comple-
ment each other. As Exhibit 7-5 shows, employees whose manager sets difficult
goals for them will have a higher level of self-efficacy and set higher goals for
their own performance. Why? Setting difficult goals for people communicates
your confidence in them. Imagine you learn your boss sets a higher goal for you
than for your co-workers. How would you interpret this? As long as you didn’t
feel you were being picked on, you would probably think, “Well, I guess my
boss thinks I’m capable of performing better than others.” This sets in motion
a psychological process in which you’re more confident in yourself (higher self-
efficacy) and you set higher personal goals, performing better both inside and
outside the workplace.
The researcher who developed self-efficacy theory, Albert Bandura, proposes
four ways self-efficacy can be increased: 61
1. Enactive mastery.
2. Vicarious modeling.
3. Verbal persuasion.
4. Arousal.
According to Bandura, the most important source of increasing self-efficacy
is enactive mastery —that is, gaining relevant experience with the task or job. If
you’ve been able to do the job successfully in the past, you’re more confident
you’ll be able to do it in the future.
Individual has
higher level of job
or task performance
Manager sets
difficult, specific
goal for job or task
Individual sets
higher personal
(self-set) goal for
their performance
Individual has
confidence that given
level of performance
will be attained
(self-efficacy)
Joint Effects of Goals and Self-Efficacy on Performance
Source: Based on E. A. Locke and G. P. Latham, “Building a Practically Useful Theory of Goal Setting and Task Motivation: A 35-Year
Odyssey,” American Psychologist (September 2002), pp. 705–717.
Exhibit 7-5

Contemporary Theories of Motivation 217
The second source is vicarious modeling —becoming more confident because
you see someone else doing the task. If your friend slims down, it increases your
confidence that you can lose weight, too. Vicarious modeling is most effective
when you see yourself as similar to the person you are observing. Watching
Tiger Woods play a difficult golf shot might not increase your confidence in
being able to play the shot yourself, but if you watch a golfer with a handicap
similar to yours, it’s persuasive.
The third source is verbal persuasion: becoming more confident because
someone convinces you that you have the skills necessary to be successful.
Motivational speakers use this tactic.
Finally, Bandura argues that arousal increases self-efficacy. Arousal leads to
an energized state, so the person gets “psyched up” and performs better. But if
the task requires a steady, lower-key perspective (say, carefully editing a manu-
script), arousal may in fact hurt performance.
What are the OB implications of self-efficacy theory? Well, it’s a matter
of applying Bandura’s sources of self-efficacy to the work setting. Training
programs often make use of enactive mastery by having people practice
and build their skills. In fact, one reason training works is that it increases
self-efficacy. 62 Individuals with higher levels of self-efficacy also appear to
reap more benefits from training programs and are more likely to use their
training on the job. 63
The best way for a manager to use verbal persuasion is through the Pygmalion
effect or the Galatea effect. As discussed in Chapter 5 , the Pygmalion effect is a
form of self-fulfilling prophecy in which believing something can make it true.
In some studies, teachers were told their students had very high IQ scores when,
in fact, they spanned a range from high to low. Consistent with the Pygmalion
effect, the teachers spent more time with the students they thought were smart,
gave them more challenging assignments, and expected more of them—all of
which led to higher student self-efficacy and better grades. 64 This strategy also
has been used in the workplace. 65 Sailors who were told convincingly that they
would not get seasick were in fact much less likely to do so. 66
Intelligence and personality are absent from Bandura’s list, but they can
increase self-efficacy. 67 People who are intelligent, conscientiousness, and
Toyota Motor Corporation applies
social learning theory in teaching
employees skills they need to meet
the company’s high standards of
quality and efficiency. At its Global
Production Center training facilities
in Japan, England, and the United
States, workers and managers from
factories around the world learn
production techniques through
observation and direct experience.
Trainees first watch computer-
ized visual manuals to learn basic
skills. Then, under the tutelage of
an experienced production mas-
ter, they practice the skills. In this
photo, a trainee practices the skill
of bolt tightening at Toyota’s train-
ing center in Toyota City, Japan.
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218 CHAPTER 7 Motivation Concepts
emotionally stable are so much more likely to have high self-efficacy that some
researchers argue self-efficacy is less important than prior research would sug-
gest. 68 They believe it is partially a by-product in a smart person with a confident
personality. Although Bandura strongly disagrees with this conclusion, more
research is needed.
Reinforcement Theory
Goal-setting is a cognitive approach, proposing that an individual’s purposes
direct his action. Reinforcement theory , in contrast, takes a behavioristic view,
arguing that reinforcement conditions behavior. The two theories are clearly at
odds philosophically. Reinforcement theorists see behavior as environmentally
caused. You need not be concerned, they would argue, with internal cognitive
events; what controls behavior is reinforcers—any consequences that, when
immediately following responses, increase the probability that the behavior will
be repeated.
Reinforcement theory ignores the inner state of the individual and
concentrates solely on what happens when he or she takes some action. Because
it does not concern itself with what initiates behavior, it is not, strictly speak-
ing, a theory of motivation. But it does provide a powerful means of analyzing
what controls behavior, and this is why we typically consider it in discussions of
motivation. 69
Operant conditioning theory, probably the most relevant component of
reinforcement theory for management, argues that people learn to behave
to get something they want or to avoid something they don’t want. Unlike
reflexive or unlearned behavior, operant behavior is influenced by the
reinforcement or lack of reinforcement brought about by its consequences.
Therefore, reinforcement strengthens a behavior and increases the likelihood
it will be repeated. 70 B. F. Skinner, one of the most prominent advocates of
operant conditioning, argued that creating pleasing consequences to follow
specific forms of behavior would increase the frequency of that behavior.
He demonstrated that people will most likely engage in desired behaviors if
they are positively reinforced for doing so; that rewards are most effective if
they immediately follow the desired response; and that behavior that is not
rewarded, or is punished, is less likely to be repeated. We know a professor
who places a mark by a student’s name each time the student makes a contri-
bution to class discussions. Operant conditioning would argue this practice is
motivating because it conditions a student to expect a reward (earning class
credit) each time she demonstrates a specific behavior (speaking up in class).
The concept of operant conditioning was part of Skinner’s broader concept
of behaviorism , which argues that behavior follows stimuli in a relatively
unthinking manner. Skinner’s form of radical behaviorism rejects feelings,
thoughts, and other states of mind as causes of behavior. In short, people
learn to associate stimulus and response, but their conscious awareness of this
association is irrelevant. 71
You can see illustrations of operant conditioning everywhere that reinforce-
ments are contingent on some action on your part. Your instructor says if you
want a high grade in the course, you must supply correct answers on the test.
A commissioned salesperson wanting to earn a sizable income finds doing so is
contingent on generating high sales in her territory. Of course, the linkage can
also teach individuals to engage in behaviors that work against the best inter-
ests of the organization. Assume your boss says if you work overtime during the
next 3-week busy season you’ll be compensated for it at your next performance
appraisal. However, when performance-appraisal time comes, you are given no
positive reinforcement for your overtime work. The next time your boss asks
5 Compare and contrast
goal-setting theory and
management by objectives.

Contemporary Theories of Motivation 219
you to work overtime, what will you do? You’ll probably decline! Your behavior
can be explained by operant conditioning: if a behavior fails to be positively
reinforced, the probability it will be repeated declines.
Although reinforcers such as pay can motivate people, the process is much
more complicated than stimulus–response. In its pure form, reinforcement
theory ignores feelings, attitudes, expectations, and other cognitive variables
known to affect behavior. In fact, some researchers look at the same experi-
ments reinforcement theorists use to support their position and interpret the
findings in a cognitive framework. 72
Reinforcement is undoubtedly an important influence on behavior, but few
scholars are prepared to argue it is the only one. The behaviors you engage in
at work and the amount of effort you allocate to each task are affected by the
consequences that follow. If you’re consistently reprimanded for outproducing
your colleagues, you’ll likely reduce your productivity. But we might also ex-
plain your lower productivity in terms of goals, inequity, or expectancies.
Individuals can learn by being told or by observing what happens to other
people, as well as through direct experiences. Much of what we have learned
comes from watching models—parents, teachers, peers, film and television per-
formers, bosses, and so forth. This view that we can learn through both observa-
tion and direct experience is called social-learning theory . 73
Although social-learning theory is an extension of operant conditioning—
that is, it assumes behavior is a function of consequences—it also acknowledges
the effects of observational learning and perception. People respond to the
way they perceive and define consequences, not to the objective consequences
themselves.
Models are central to the social-learning viewpoint. Four processes deter-
mine their influence on an individual:
1. Attentional processes. People learn from a model only when they recog-
nize and pay attention to its critical features. We tend to be most influenced
by models that are attractive, repeatedly available, important to us, or simi-
lar to us in our estimation.
2. Retention processes. A model’s influence depends on how well the indi-
vidual remembers the model’s action after the model is no longer readily
available.
3. Motor reproduction processes. After a person has seen a new behavior by
observing the model, watching must be converted to doing. This process
demonstrates that the individual can perform the modeled activities.
4. Reinforcement processes. Individuals are motivated to exhibit the mod-
eled behavior if positive incentives or rewards are provided. Positively rein-
forced behaviors are given more attention, learned better, and performed
more often.
Equity Theory/Organizational Justice
Jane Pearson graduated from State University last year with a degree in account-
ing. After interviews with a number of organizations on campus, she accepted
a position with a top public accounting firm and was assigned to its Boston of-
fice. Jane was very pleased with the offer she received: challenging work with
a prestigious firm, an excellent opportunity to gain valuable experience, and
6 Contrast reinforcement
theory and goal-setting
theory.
reinforcement theory A theory that
says that behavior is a function of its
consequences.
behaviorism A theory that argues that
behavior follows stimuli in a relatively
unthinking manner.
social-learning theory The view that
we can learn through both observation
and direct experience.

220 CHAPTER 7 Motivation Concepts
the highest salary any accounting major at State was offered last year—$4,550
per month—but Jane was the top student in her class; she was articulate and
mature, and she fully expected to receive a commensurate salary.
Twelve months have passed. The work has proved to be as challenging
and satisfying as Jane had hoped. Her employer is extremely pleased with her
performance; in fact, Jane recently received a $200-per-month raise. However,
her motivational level has dropped dramatically in the past few weeks. Why?
Jane’s employer has just hired a fresh graduate out of State University who
lacks the year of experience Jane has gained, for $4,600 per month—$50
more than Jane now makes! Jane is irate. She is even talking about looking for
another job.
Jane’s situation illustrates the role that equity plays in motivation. Employees
perceive what they get from a job situation (salary levels, raises, recogni-
tion) in relationship to what they put into it (effort, experience, education,
competence), and then they compare their outcome–input ratio with that of
relevant others. This is shown in Exhibit 7-6 . If we perceive our ratio to be equal
to that of the relevant others with whom we compare ourselves, a state of eq-
uity exists; we perceive that our situation is fair and justice prevails. When we
see the ratio as unequal and we feel underrewarded, we experience equity ten-
sion that creates anger. When we see ourselves as overrewarded, tension creates
guilt. J. Stacy Adams proposed that this negative state of tension provides the
motivation to do something to correct it. 74
The referent an employee selects adds to the complexity of equity theory . 75
There are four referent comparisons:
1. Self–inside. An employee’s experiences in a different position inside the
employee’s current organization.
2. Self–outside. An employee’s experiences in a situation or position outside
the employee’s current organization.
3. Other–inside. Another individual or group of individuals inside the
employee’s organization.
4. Other–outside. Another individual or group of individuals outside the
employee’s organization.
Employees might compare themselves to friends, neighbors, co-workers, or
colleagues in other organizations or compare their present job with past jobs.
Which referent an employee chooses will be influenced by the information the
employee holds about referents as well as by the attractiveness of the referent.
Four moderating variables are gender, length of tenure, level in the organiza-
tion, and amount of education or professionalism. 76
Ratio Comparisons* Perception
Inequity due to being underrewarded
Equity
Inequity due to being overrewarded
*Where represents the employee; and represents relevant others
O
I B
O
I A
> O
IB
O
IA
= O
IB
O
IA
< O IB O IA Equity Theory Exhibit 7-6 Contemporary Theories of Motivation 221 Women are typically paid less than men in comparable jobs and have lower pay expectations than men for the same work. 77 So a woman who uses another woman as a referent tends to calculate a lower comparative standard. Of course, employers’ stereotypes about women (for example, the belief that women are less committed to the organization or that “women’s work” is less valuable) also may contribute to the pay gap. 78 While both men and women prefer same-sex comparisons, employees in jobs that are not sex segregated will likely make more cross-sex comparisons than those in jobs that are male or female dominated. Employees with short tenure in their current organizations tend to have little information about others inside the organization, so they rely on their personal experiences. Employees with long tenure rely more heavily on co-workers for comparison. Upper-level employees, those in the profes- sional ranks, and those with higher amounts of education tend to have better information about people in other organizations and will make more other– outside comparisons. Based on equity theory, employees who perceive inequity will make one of six choices: 79 1. Change inputs (exert less effort if underpaid or more if overpaid). 2. Change outcomes (individuals paid on a piece-rate basis can increase their pay by producing a higher quantity of units of lower quality). 3. Distort perceptions of self (“I used to think I worked at a moderate pace, but now I realize I work a lot harder than everyone else.”). 4. Distort perceptions of others (“Mike’s job isn’t as desirable as I thought.”). 5. Choose a different referent (“I may not make as much as my brother-in-law, but I’m doing a lot better than my Dad did when he was my age.”). 6. Leave the field (quit the job). equity theory A theory that says that individuals compare their job inputs and outcomes with those of others and then respond to eliminate any inequities. In perceiving inequity in pay, these American Airline pilots used an “other-inside” referent comparison when comparing their pay to that of the airline’s managers. The pilots agreed to accept wage and benefit cuts after the airline reported an $8 billion loss. When they returned to profitability, the CEO and other top managers received stock bonuses. Marching in protest, the pilots argued that their sacrifices in pay and benefits helped save the airline from bankruptcy and that they deserved to be rewarded with pay increases. So u rc e : LM O te ro /A P I m a g e s 222 CHAPTER 7 Motivation Concepts Some of these propositions have been supported, but others haven’t. 80 First, inequities created by overpayment do not seem to significantly affect behavior in most work situations. Apparently, people have more toler- ance of overpayment inequities than of underpayment inequities or are better able to rationalize them. It’s pretty damaging to a theory when half the equation falls apart. Second, not all people are equity sensitive. 81 A few actually prefer outcome–input ratios lower than the referent comparisons. Predictions from equity theory are not likely to be very accurate about these “benevolent types.” While most research on equity theory has focused on pay, some employ- ees also look for equity in the distribution of other organizational rewards like high-status job titles and large and lavishly furnished offices. 82 Finally, recent research has expanded the meaning of equity, or fairness . 83 Historically, equity theory focused on distributive justice , the employee’s perceived fairness of the amount rewards among individuals and who received them. But organizational justice draws a bigger picture. Employees perceive their organizations as just when they believe rewards and the way they are distributed are fair. In other words, fairness or equity can be subjective; what one person sees as unfair, another may see as perfectly appropriate. In general, people see allocations or procedure favoring themselves as fair. 84 In a recent poll, 61 percent of respondents said they pay their fair share of taxes, but an almost equal number (54 percent) felt the system as a whole is unfair, saying some people skirt it. 85 Most of the equity theory research we’ve described proposes a fairly rational, calculative way of estimating what is fair and unfair. But few people really make mathematical calculations of their inputs relative to the outcomes of others. Instead, they base distributive judgments on a feeling or an emotional reaction to how they think they are treated relative to others, and their reactions are often emotional as well. 86 Our discussion has also focused on reactions to personal mistreatment. However, people also react emotionally to injustices committed against others, prompting them to take retributive actions. 87 Beyond perceptions of fairness, the other key element of organizational justice is the view that justice is multidimensional. How much we get paid relative to what we think we should be paid (distributive justice) is obviously important. But, according to researchers, how we get paid is just as important. Thus, the model of organizational justice in Exhibit 7-7 includes procedural justice —the perceived fairness of the process used to determine the distribu- tion of rewards. Two key elements of procedural justice are process control and explanations. Process control is the opportunity to present your point of view about desired outcomes to decision makers. Explanations are clear reasons management gives for the outcome. Thus, for employees to see a process as fair, they need to feel they have some control over the outcome and that they were given an adequate explanation about why the outcome occurred. It’s also important that a manager is consistent (across people and over time), is unbiased, makes decisions based on accurate information, and is open to appeals. 88 The effects of procedural justice become more important when distributive justice is lacking. This makes sense. If we don’t get what we want, we tend to focus on why. If your supervisor gives a cushy office to a co-worker instead of to you, you’re much more focused on your supervisor’s treatment of you than if you had gotten the office. Explanations are beneficial when they take the form of post hoc excuses (“I know this is bad, and I wanted to give you the office, but it wasn’t my decision”) rather than justifications (“I decided to give the office to Sam, but having it isn’t a big deal.”). 89 Contemporary Theories of Motivation 223 Interactional justice describes an individual’s perception of the degree to which she is treated with dignity, concern, and respect. When people are treated in an unjust manner (at least in their own eyes), they retaliate (for example, badmouthing a supervisor). 90 Because people intimately connect interactional justice or injustice to the conveyer of the information, we would expect percep- tions of injustice to be more closely related to the supervisor. Generally, that’s what the evidence suggests. 91 Of these three forms of justice, distributive justice is most strongly related to organizational commitment and satisfaction with outcomes such as pay. Procedural justice relates most strongly to job satisfaction, employee trust, withdrawal from the organization, job performance, and citizenship behaviors. There is less evidence about interactional justice. 92 Equity theory has gained a strong following in the United States because U.S.-style reward systems assume workers are highly sensitive to equity in reward allocations. And in the United States, equity is meant to closely tie pay to performance. However, in collectivist cultures employees expect re- wards to reflect their individual needs as well as their performance. 93 Other research suggests that inputs and outcomes are valued differently in various Organizational Justice Definition: overall perception of what is fair in the workplace Example: I think this is a fair place to work. Distributive Justice Definition: perceived fairness of outcome Example: I got the pay raise I deserved. Procedural Justice Definition: perceived fairness of process used to determine outcome Example: I had input into the process used to give raises and was given a good explanation of why I received the raise I did. Interactional Justice Definition: perceived degree to which one is treated with dignity and respect Example: When telling me about my raise, my supervisor was very nice and complimentary. Model of Organizational Justice Exhibit 7-7 interactional justice The perceived degree to which an individual is treated with dignity, concern, and respect. distributive justice Perceived fairness of the amount and allocation of rewards among individuals. procedural justice The perceived fairness of the process used to determine the distribution of rewards. organizational justice An overall perception of what is fair in the workplace, composed of distributive, procedural, and interactional justice. 224 CHAPTER 7 Motivation Concepts cultures. 94 Some cultures emphasize status over individual achievement as a basis for allocating resources. Materialistic cultures are more likely to see cash compensation and rewards as the most relevant outcomes of work, whereas relational cultures will see social rewards and status as important outcomes. International managers must consider the cultural preferences of each group of employees when determining what is “fair” in different contexts. Studies suggest that managers are indeed motivated to foster employees’ perceptions of justice because they wish to ensure compliance, maintain a posi- tive identity, and establish fairness at work. 95 To enhance perceptions of justice, they should realize that employees are especially sensitive to unfairness in pro- cedures when bad news has to be communicated (that is, when distributive jus- tice is low). Thus, it’s especially important to openly share information about how allocation decisions are made, follow consistent and unbiased procedures, and engage in similar practices to increase the perception of procedural justice. Second, when addressing perceived injustices, managers need to focus their actions on the source of the problem. If employees feel they have been treated unjustly, having opportunities to express their frustration has been shown to reduce their desire for retribution. 96 Meta-analytic evidence shows individuals in both individualistic and collectivistic cultures prefer an equitable distribution of rewards (the most effective workers get paid the most) over an equal division (everyone gets paid the same regardless of performance). 97 Across nations, the same basic princi- ples of procedural justice are respected, and workers around the world prefer rewards based on performance and skills over rewards based on seniority. 98 Expectancy Theory One of the most widely accepted explanations of motivation is Victor Vroom’s expectancy theory . 99 Although it has its critics, most of the evidence supports it. 100 Expectancy theory argues that the strength of our tendency to act a certain way depends on the strength of our expectation of a given outcome and its attractiveness. In more practical terms, employees will be motivated to exert a high level of effort when they believe it will lead to a good performance appraisal; that a good appraisal will lead to organizational rewards such as bonuses, salary increases, or promotions; and that the rewards will satisfy the employees’ personal goals. The theory, therefore, focuses on three relation- ships (see Exhibit 7-8 ): 1. Effort–performance relationship. The probability perceived by the indi- vidual that exerting a given amount of effort will lead to performance. 2. Performance–reward relationship. The degree to which the individual believes performing at a particular level will lead to the attainment of a desired outcome. 7 Demonstrate how organizational justice is a refinement of equity theory. Individual effort 1 2 3 Individual performance Effort–performance relationship Performance–reward relationship Rewards–personal goals relationship Organizational rewards Personal goals 1 2 3 Expectancy Theory Exhibit 7-8 MyManagementLab For an interactive application of this topic, check out this chapter’s simulation activity at www.mymanagementlab.com. www.mymanagementlab.com Contemporary Theories of Motivation 225 3. Rewards–personal goals relationship. The degree to which organizational rewards satisfy an individual’s personal goals or needs and the attractiveness of those potential rewards for the individual. 101 Expectancy theory helps explain why a lot of workers aren’t motivated on their jobs and do only the minimum necessary to get by. Let’s frame the theory’s three relationships as questions employees need to answer in the affirmative if their motivation is to be maximized. First, if I give a maximum effort, will it be recognized in my performance appraisal? For many employees, the answer is “no.” Why? Their skill level may be deficient, which means no matter how hard they try, they’re not likely to be high performers. The organization’s performance appraisal system may be designed to assess nonperformance factors such as loyalty, initiative, or courage, which means more effort won’t necessarily result in a higher evaluation. Another possibility is that employees, rightly or wrongly, perceive the boss doesn’t like them. As a result, they expect a poor appraisal, regardless of effort. These examples suggest one possible source of low motivation is employees’ belief that, no matter how hard they work, the likelihood of getting a good perfor- mance appraisal is low. Second, if I get a good performance appraisal, will it lead to organizational rewards? Many organizations reward things besides performance. When pay is based on factors such as having seniority, being cooperative, or “kissing up” to the boss, employees are likely to see the performance–reward relationship as weak and demotivating. Finally, if I’m rewarded, are the rewards attractive to me? The employee works hard in the hope of getting a promotion but gets a pay raise instead. Or the employee wants a more interesting and challenging job but receives only a few words of praise. Unfortunately, many managers are limited in the rewards they can distribute, which makes it difficult to tailor rewards to individual em- ployee needs. Some incorrectly assume all employees want the same thing, thus overlooking the motivational effects of differentiating rewards. In either case, employee motivation is submaximized. As a vivid example of how expectancy theory can work, consider stock ana- lysts. They make their living trying to forecast a stock’s future price; the accu- racy of their buy, sell, or hold recommendations is what keeps them in work or gets them fired. But it’s not quite that simple. Analysts place few sell ratings on stocks, although in a steady market, by definition, as many stocks are falling as are rising. Expectancy theory provides an explanation: analysts who place a sell rating on a company’s stock have to balance the benefits they receive by being accurate against the risks they run by drawing that company’s ire. What are these risks? They include public rebuke, professional blackballing, and exclu- sion from information. When analysts place a buy rating on a stock, they face no such trade-off because, obviously, companies love it when analysts recommend that investors buy their stock. So the incentive structure suggests the expected outcome of buy ratings is higher than the expected outcome of sell ratings, and that’s why buy ratings vastly outnumber sell ratings. 102 expectancy theory A theory that says that the strength of a tendency to act in a certain way depends on the strength of an expectation that the act will be followed by a given outcome and on the attractiveness of that outcome to the individual. 226 CHAPTER 7 Motivation Concepts Does expectancy theory work? Some critics suggest it has only limited use and is more valid where individuals clearly perceive effort– performance and performance–reward linkages. 103 Because few individuals do, the theory tends to be idealistic. If organizations actually rewarded individuals for performance rather than seniority, effort, skill level, and job difficulty, expectancy theory might be much more valid. However, rather than invalidating it, this criti- cism can explain why a significant segment of the workforce exerts low effort on the job. At Mary Kay Cosmetics, the performance-reward relationship is strong. The company offers a generous rewards and recognition program based on the achieve- ment of personal goals set by each employee. Mary Kay also understands the motivational effects of differentiating rewards. For some employees, the best reward is the opportunity to work from home, while other employees are motivated by the opportunity to win a trip, jewelry, or the use of a pink Cadillac. In this photo, a Mary Kay sales director explains career opportunities at a job fair to women interested in joining the company. Integrating Contemporary Theories of Motivation Things might be simpler if, after presenting a half dozen theories, we could say only one was found valid. But many of the theories in this chapter are complementary. We now tie them together to help you understand their interrelationships. 104 Exhibit 7-9 integrates much of what we know about motivation. Its basic foundation is the expectancy model shown in Exhibit 7-8 . Let’s walk through Exhibit 7-9 . (We will look at job design closely in Chapter 8 .) We begin by explicitly recognizing that opportunities can either aid or hinder individual effort. The individual effort box on the left also has another arrow leading into it, from the person’s goals. Consistent with goal-setting theory, the goals–effort loop is meant to remind us that goals direct behavior. Expectancy theory predicts employees will exert a high level of effort if they perceive a strong relationship between effort and performance, performance and rewards, and rewards and satisfaction of personal goals. Each of these relationships is, in turn, influenced by other factors. For 8 Apply the key tenets of expectancy theory to motivating employees. 9 Compare contemporary theories of motivation. So u rc e : E ri c R is b e rg /A P I m a g e s Integrating Contemporary Theories of Motivation 227 effort to lead to good performance, the individual must have the ability to perform and perceive the performance appraisal system as fair and objec- tive. The performance–reward relationship will be strong if the individual perceives that performance (rather than seniority, personal favorites, or other criteria) is rewarded. If cognitive evaluation theory were fully valid in the actual workplace, we would predict here that basing rewards on perfor- mance should decrease the individual’s intrinsic motivation. The final link in expectancy theory is the rewards–goals relationship. Motivation is high if the rewards for high performance satisfied the dominant needs consistent with individual goals. A closer look at Exhibit 7-9 also reveals that the model considers achievement motivation, job design, reinforcement, and equity theories/organizational justice. A high achiever is not motivated by an organization’s assessment of performance or organizational rewards, hence the jump from effort to personal goals for those with a high nAch. Remember, high achievers are internally driven as long as their jobs provide them with personal responsibility, feedback, and moderate risks. They are not concerned with the effort–performance, performance–rewards, or rewards–goal linkages. Reinforcement theory enters the model by recognizing that the organization’s rewards reinforce the individual’s performance. If employees see a reward system as “paying off” for good performance, the rewards will reinforce and encourage good performance. Rewards also play the key part in Individual performance Organizational rewards Personal goals Opportunity Ability Performance evaluation criteria High nAch Equity comparison/ Organizational justice Objective performance evaluation system Individual effort Reinforcement Dominant needs Goals direct behavior Job design O IA IB O: Integrating Contemporary Theories of Motivation Exhibit 7-9 228 CHAPTER 7 Motivation Concepts The motivation theories in this chapter differ in their predictive strength. Here, we (1) review the most established to determine their relevance in explaining turnover, productivity, and other outcomes and (2) assess the predictive power of each. 105 ● Need theories. Maslow’s hierarchy, McClelland’s needs, and the two- factor theory focus on needs. None has found widespread support, although McClelland’s is the strongest, particularly regarding the relationship between achievement and productivity. In general, need theories are not very valid explanations of motivation. ● Self-determination theory and cognitive evaluation theory. As research on the motivational effects of rewards has accumulated, it increasingly appears extrinsic rewards can undermine motivation if they are seen as coercive. They can increase motivation if they provide information about competence and relatedness. ● Goal-setting theory. Clear and difficult goals lead to higher levels of employee productivity, supporting goal-setting theory’s explanation of this dependent variable. The theory does not address absenteeism, turnover, or satisfaction, however. ● Reinforcement theory. This theory has an impressive record for predicting quality and quantity of work, persistence of effort, absentee- ism, tardiness, and accident rates. It does not offer much insight into employee satisfaction or the decision to quit. ● Equity theory/organizational justice. Equity theory deals with produc- tivity, satisfaction, absence, and turnover variables. However, its strongest legacy is that it provided the spark for research on organizational justice, which has more support in the literature. ● Expectancy theory. Expectancy theory offers a powerful explana- tion of performance variables such as employee productivity, absentee- ism, and turnover. But it assumes employees have few constraints on decision making, such as bias or incomplete information, and this limits its applicability. Expectancy theory has some validity because, for many behaviors, people consider expected outcomes. Summary and Implications for Managers MyManagementLab Now that you have finished this chapter, go back to www.mymanagementlab.com to continue practicing and applying the concepts you’ve learned. organizational justice research. Individuals will judge the favorability of their outcomes (for example, their pay) relative to what others receive but also with respect to how they are treated: when people are disappointed in their rewards, they are likely to be sensitive to the perceived fairness of the procedures used and the consideration given to them by their supervisor. www.mymanagementlab.com Summary and Implications for Managers 229 Fear Is a Powerful Motivator POINT COUNTERPOINT H ow cynical! Fear is a natural emotion, but it gener- ally serves a purpose only in crisis situations. Those unfortunate enough to work under a manager who consciously uses fear to “motivate” behavior will leave as soon as they can or get even in some hidden way. Fear never works as a motivational tool. Various areas of research in psychology and organizational behavior prove the point. Fear generates a “fight-flight-freeze” response, in which an individual (or animal) experiencing fear or extreme stress is forced to choose one of these behaviors. Any sane manager wants none of them. Imagine supervising Chris, who flees work when fearful or stressed, Sanjay, who fights with others when he feels cornered, and Mercedes, who locks up whenever she is chastised. Does effective management mean eliciting these behaviors? One workplace expert noted, “Fear motivation always results in inner anger and resentment against the person using the fear tactics . . . Fear motivation is the lowest form of motivation and usu- ally results in ‘when the cat is away, the mice will play.’” So, ironi- cally, fear actually undermines performance monitoring, because employees will get even when they know they can’t be caught. And they will never go out of their way to help the organization. As one Canadian manager noted, “Exercising unilateral power [through fear] can be effective for those leaders whose modest ambitions are matched by the modest successes that such tactics bring.” Zappos founder Tony Hsieh, who tries to create a happy work environment at Zappos by giving employ- ees the sense that they are part of something bigger, argues that inspiration is a much better motivator than fear. Fear may motivate short-term performance, but in the long run, it is always a losing motivational tool. T his is a “dark side” topic that no one likes to discuss, but fear works as a motivator. Few of us like the idea of feeling fearful in the workplace. But what we like and what moti- vates us are not the same. Ever studied harder for an exam for fear of doing poorly, or worried about doing something that would draw your parents’ ire? If you answer “yes,” you’re on your way to admitting this essential truth: we engage in a lot of behaviors, and refrain from others, out of fear. Too often in organizational behavior we sing this happy song that when employees are happy, they will give their best effort and the company will sail along in smooth seas. The truth is that when a manager adopts this philoso- phy, people often relax. They take off early. They “shoot the breeze” more and work a little less. George Cloutier, founder of American Management Services, is realistic about this. “The concept that if you love your employees they’ll per- form is on the edge of insanity,” he says. “Fear is the best motivator.” Employees should realize that in today’s competitive envi- ronment, they have to bring their A-game to work each and every day. And managers need to closely monitor them to make sure that’s the case. Instilling in employees a fear that if they shirk, they’ll lose their jobs, is one way to accomplish that monitoring. Without fear, people would do as they wish, and that rarely includes working hard if they feel they don’t have to. Like it or not, that’s the cold, hard truth about employee motivation. Sources: K. Pattison, “Fire Your Relatives. Scare Your Employees. And Stop Whining,” The New York Times (February 11, 2010), p. B8; L. Mignone, “How to Build an Army of Happy, Busy Worker Bees,” Fortune (May 23, 2011), downloaded May 25, 2011, from www.fortune.com ; TTI Performance Systems, “Provide a Climate for Motivation,” downloaded May 25, 2011, from www.nielsongroup.com/ ; and J. Wood, “Stories, Not Data, At Heart of Human Motivation,” Vancouver Sun (May 20, 2011), downloaded May 25, 2011, from www.vancouversun.com/ . www.fortune.com www.nielsongroup.com/ www.vancouversun.com/ 230 CHAPTER 7 Motivation Concepts 6 What are the similarities and differences between reinforcement theory and goal-setting theory? 7 How is organizational justice a refinement of equity theory? 8 What are the key tenets of expectancy theory? 9 What are some contemporary theories of motivation and how do they compare to one another? 1 What are the three key elements of motivation? 2 What are some early theories of motivation? How appli- cable are they today? 3 How do the predictions of self-determination theory apply to intrinsic and extrinsic rewards? 4 What are the implications of employee engagement for management? 5 What are the similarities and differences between goal- setting theory and management by objectives? QUESTIONS FOR REVIEW Purpose This exercise will help you learn how to write tangible, verifiable, measurable, and relevant goals that might evolve from an MBO program. Time Approximately 20 to 30 minutes. Instructions 1. Break into groups of three to five. 2. Spend a few minutes discussing your class instructor’s job. What does he or she do? What defines good performance? What behaviors lead to good performance? 3. Each group is to develop a list of five goals that, although not established participatively with your instructor, you believe might be developed in an MBO program at your college. Try to select goals that seem most critical to the effective performance of your instructor’s job. 4. Each group will select a leader who will share the group’s goals with the entire class. For each group’s goals, class discussion should focus on the goals’ (a) specificity, (b) ease of measurement, (c) importance, and (d) motivational properties. EXPERIENTIAL EXERCISE Goal-Setting Task As you know, college is an expensive proposition. Students, parents, donors, and the government invest millions of dollars every year. Thus, there may be an incumbent responsibility on students to ensure they are learning. However, consider the following results from a recent study of time use by more than 3,000 undergraduates: ETHICAL DILEMMA The Big Easy? 9% 9% 24% 51% 7% Percent Time per Week Spent Attending classes and labs Studying Working, volunteering, fraternities/sororities, clubs Sleeping Socializing, recreation, other Undergraduate Use of Time per Week Questions 1. One article commented that college students are “frittering away their time at an astonishing rate.” Do you agree this is what the data show? Why or why not? 2. Do you think students have an ethical responsibility to spend more time studying? Why or why not? 3. One study suggested that full-time students in 1961 studied an average of 40 hours per week, compared to 27 hours now. Does this apparent trend concern you? Do you think that, as some experts have claimed, our economic competitiveness would increase if college students studied more? Sources: M. Burns, “What Happened to Academic Rigor?” Miller-McCune (March 8, 2011), pp. 47–49; and R. Arum, Academically Adrift: Limited Learning on College Campuses (Chicago: University of Chicago Press, 2011). Case Incident 2 231 CASE INCIDENT 2 Bullying Bosses After a long weekend, Kara stared at her computer with a sick feeling in her stomach: her boss had added her as a friend on Facebook. Kara did not feel particularly close to her boss, nor did she like the idea of mixing her social life with her work. Still, it was her boss. Kara reluctantly ac- cepted her boss as a Facebook friend. Little did she know her troubles were only beginning. Kara’s boss soon began using her online information to manipulate her work life. It began with inappropri- ate innuendos regarding Facebook photos. Eventually, Kara’s boss manipulated her work hours, confronted her both on and off Facebook, and repeatedly called Kara’s cell phone questioning her whereabouts. “My boss was a gossiping, domineering, contriving megalomaniac, and her behavior dramatically intensified when she used Facebook to pry,” Kara said. Eventually, Kara was forced to quit. “I feel like I got my freedom back and can breathe again,” she said. Although many individuals recall bullies from elementary school days, some are realizing bullies can ex- ist in the workplace, too. In a recent poll, 37 percent of em- ployees report being victims of a bullying boss. And these bullies don’t pick on just the weakest in the group; any subordinate may fall prey. As Kara found, bullying is not limited to male bosses: 40 percent of bullies are women, and women are their targets 70 percent of the time. How does bullying affect employee motivation and be- havior? Surprisingly, though victims may feel less motivated CASE INCIDENT 1 It’s Not Fair! Few topics in the business press have grabbed more headlines recently than highly lucrative annual bonuses for top management. Critics bemoan the multimillion- dollar compensation packages offered in the financial services industry in particular, following the dire consequences of the meltdown of this sector a few short years ago. How is executive compensation determined by compensation committees? Some researchers suggest that principles from equity theory (making comparisons to ref- erent others) might explain variations in executive pay. To set what is considered a “fair” level of pay for top executives, members of the board find out how much executives with similar levels of experience in similar firms (similar inputs) are being paid and attempt to adjust compensation (out- comes) to be equitable. In other words, top executives in large oil firms are paid similarly to top executives in other large oil firms, top executives in small hospitals are paid similarly to top executives in other small hospitals. In many cases, simply changing the referent others can change the salary range considered acceptable. According to one view of justice theory, this should be perceived as equitable, although executives may encourage boards to consider spe- cific referent others who are especially well-paid. Critics of executive compensation change the debate by focusing on the ratio of executive compensation to that of the company’s lowest-paid employees. Researcher Cary Cooper notes, “In business, it is important to reward success and not simply status.” Cooper believes all employees should share the company’s good fortune in profitable periods. He has recommended that CEO com- pensation be capped at 20 times the salary of the lowest- paid employee. In fact, the average S&P 500 CEO is paid 263 times what the lowest-paid laborer makes. This is eight times more than the ratio from the 1950s, which might serve as another reference point for determining what is considered “fair.” Questions 1. How does the executive compensation issue relate to equity theory? Who do you think should be the referent others in these equity judgments? What are the relevant inputs for top executives? 2. Can you think of procedural justice implications related to the ways pay policies for top executives have been instituted? Do these pay-making decisions follow the procedural justice principles outlined in the chapter? 3. Do you think the government has a legitimate role in controlling executive compensation? How might we use distributive and procedural justice theories to inform this debate? 4. Are there any positive motivational consequences of tying compensation pay closely to firm performance? Sources: J. Bizjak, M. Lemmon, and T. Nguyen, “Are All CEOs Above Average? An Empirical Analysis of Compensation Peer Groups and Pay Design,” Journal of Financial Economics 100, no. 3 (2011), pp. 538–555; C. Cooper, “We’re All in This Together,” Director 64 (February 2011), p. 27; and R. Foroohar, “Stuffing Their Pockets: For CEOs, A Lucrative Recession” Newsweek (September 13, 2010), www.newsweek.com . www.newsweek.com 232 CHAPTER 7 Motivation Concepts he or she has been annoying, or lazy, [or] did something to earn it,” she says. Questions 1. How does workplace bullying violate the rules of organizational justice? 2. What aspects of motivation might workplace bullying reduce? For example, are there likely to be effects on an employee’s self-efficacy? If so, what might those effects be? Do you think bullying would motivate you to retaliate? 3. If you were a victim of workplace bullying, what steps would you take to try to reduce its occurrence? What strategies would be most effective? Least effective? What would you do if one of your colleagues were a victim? 4. What factors do you believe contribute to workplace bullying? Are bullies a product of the situation, or do they have flawed personalities? What situations and what personality factors might contribute to the presence of bullies? to go to work every day, they continue performing their required job duties. However, some are less motivated to perform extra-role or citizenship behaviors. Helping oth- ers, speaking positively about the organization, and going beyond the call of duty are reduced as a result of bullying. According to Dr. Bennett Tepper, fear may be the reason many workers continue to perform. And not all individu- als reduce their citizenship behaviors. Some continue to engage in extra-role behaviors to make themselves look better than their colleagues. Other victims of bullying may be motivated to actively retaliate against their bullying su- pervisor, or engage in acts of workplace withdrawal. What should you do if your boss is bullying you? Don’t necessarily expect help from co-workers. As Emelise Aleandri, an actress and producer from New York who left her job after being bullied, stated, “Some people were afraid to do anything. But others didn’t mind what was happening at all, because they wanted my job.” Moreover, according to Dr. Michelle Duffy of the University of Kentucky, co-workers often blame victims of bullying in or- der to resolve their own guilt. “They do this by wondering whether maybe the person deserved the treatment, that ENDNOTES 1. See, for example, G. P. Latham and C. C. Pinder, “Work Motivation Theory and Research at the Dawn of the Twenty- First Century,” Annual Review of Psychology 56 (2005), pp. 485–516; and C. Pinder, Work Motivation in Organizational Behavior, 2nd ed. (London, UK: Psychology Press, 2008). 2. R. Wagner and J. K. Harter, 12: The Elements of Great Managing (Washington, DC: Gallup Press, 2006). 3. “The 2008 Wasting Time at Work Survey Reveals a Record Number of People Waste Time at Work,” Salary.com (2008), www.salary.com . 4. See, for instance, Pinder, Work Motivation in Organizational Behavior . 5. A. Maslow, Motivation and Personality (New York: Harper & Row, 1954). 6. G. Hofstede, “Motivation, Leadership, and Organization: Do American Theories Apply Abroad?” Organizational Dynamics (Summer 1980), p. 55. 7. See, for example, E. E. Lawler III and J. L. Suttle, “A Causal Correlation Test of the Need Hierarchy Concept,” Organizational Behavior and Human Performance 7 , no. 2 (1972), pp. 265–287; D. T. Hall and K. E. 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Falk, “Construct Validation of a Theory X/Y Behavior Scale,” Leadership and Organization Development Journal 31, no. 2 (2010), pp. 120–135. 11. F. Herzberg, B. Mausner, and B. Snyderman, The Motivation to Work (New York: Wiley, 1959). 12. R. J. House and L. A. Wigdor, “Herzberg’s Dual-Factor Theory of Job Satisfaction and Motivations: A Review of the Evidence and Criticism,” Personnel Psychology 20 , no. 4 (1967), pp. 369–389; D. P. Schwab and L. L. Cummings, “Theories of Performance and Satisfaction: A Review,” Industrial Relations 9, no. 4 (1970), pp. 403–430; and J. Phillipchuk Sources: Based on M. Wilding, “Is Your Boss Your Friend or Foe?” Sydney Morning Herald (May 19, 2009), pp. 1–3; C. Benedict, “The Bullying Boss,” The New York Times (June 22, 2004), p. F1; and S. Thau and M. S. Mitchell, “Self-Gain or Self-Regulation Impairment? 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Vandenberghe, “Employee Commitment and Motivation: A Conceptual Analysis and Integrative Model,” Journal of Applied Psychology 89, no. 6 (2004), pp. 991–1007. 26. W. A. Kahn, “Psychological Conditions of Personal Engagement and Disengagement at Work,” Academy of Management Journal 33, no. 4 (1990), pp. 692–724. 27. www.gallup.com/consulting/52/Employee-Engagement. aspx 28. J. K. Harter, F. L. Schmidt, and T. L. Hayes, “Business- Unit-Level Relationship Between Employee Satisfaction, Employee Engagement, and Business Outcomes: A Meta-Analysis,” Journal of Applied Psychology 87, no. 2 (2002), pp. 268–279. 29. M. S. Christian, A. S. Garza, and J. E. Slaughter, “Work Engagement: A Quantitative Review and Test of Its Relations with Task and Contextual Performance,” Personnel Psychology 64, no. 1 (2011), pp. 89–136. 30. W. B. Schaufeli, A. B. Bakker, and W. van Rhenen, “How Changes in Job Demands and Resources Predict Burnout, Work Engagement, and Sickness Absenteeism,” Journal of Organizational Behavior 30, no. 7 (2009), pp. 893–917; E. R. Crawford, J. A. LePine, and B. L. Rich, “Linking Job Demands and Resources to Employee Engagement and Burnout: A Theoretical Extension and Meta-Analytic Test,” Journal of Applied Psychology 95, no. 5 (2010), pp. 834–848; and D. Xanthopoulou, A. B. Bakker, E. Demerouti, and W. B. Schaufeli, “Reciprocal Relationships Between job Resources, Personal Resources, and Work Engagement,” Journal of Vocational Behavior 74, no. 3 (2009), pp. 235–244. 31. B. L. Rich, J. A. LePine, and E. R. Crawford, “Job Engagement: Antecedents and Effects on Job Performance,” Academy of Management Journal 53, no. 3 (2010), pp. 617–635. 32. M. Tims, A. B. Bakker, and D. 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