Imagine going to an office where you have nobody to report to. Everyone works as they please and no one is accountable for their tasks. Doesn’t sound very organized, does it?

The practice of organizational behavior brings order to chaos. Structure, accountability and a defined work culture allow people to understand their roles and responsibilities in an organization.

Understanding human behavior and motivations helps the management set effective goals, encourage employees and achieve results.

Let’s discuss what is organizational behavior and why it is important. You’ll learn how it can help you navigate different work styles for effective results.

What Is Organizational Behavior?

Organizational behavior is the study of how individuals and groups interact with each other and with the organization. An effective organizational behavior strategy can help management motivate its employees to perform well. Achieving collective goals becomes easier and simple when everyone’s on the same page.

There are four elements of organizational behavior:

  1. People who make up the organization

  2. A structure that defines whether the organization is hierarchical or flat

  3. Technology or the work processes and systems deployed by employees

  4. Environment comprising the external environment within which an organization operates

The Importance Of Organizational Behavior

The need and importance of organizational behavior arise when there’s a need to improve work performance and achieve optimal results. Several organizations employ effective management strategies to get everyone on the same page. Leaders guide their staff towards success by motivating and inspiring them to do their best.

Here are a few reasons why organizational behavior is important.

  1. Effective Decision-Making

A well-designed organizational structure in place makes the decision-making process more effective. This means that every member of the team or the organization is well-versed in their roles and responsibilities. They find it easier to act independently, being proactive and taking initiative. Managers can delegate tasks swiftly and assign tasks according to varying degrees of skills and follow-up. This ensures that everything runs smoothly.

  1. Understanding People

Organizational behavior helps the management understand people, their motivation and their skills and abilities. The management must be aware of subtle differences in work styles if they want to encourage teamwork. Everyone has personal goals that are aligned with professional goals. With a carefully-placed organizational structure, it’s easier to track progress and fulfill employee needs for the best results.

  1. Navigating Workplace Conflicts

An organization works effectively if there is good communication, openness and trust. The importance of organizational behavior is that it helps teams function with minimal conflict. There’s accountability at every step because tasks are interdependent. Organizations also have a code of conduct and certain values that employees must abide by. This regulates the work environment, keeping everyone focused on larger goals.

  1. Improved Performance

Motivating employees, giving incentives and acknowledging hard work are the pillars of organizational behavior. This helps improve work performance because employees are inspired to put their best foot forward. If you feel that you’re valuable to the organization, you’re likely to work harder. The management must ensure that employees feel like a part of the organization to encourage them toward achieving short-term and long-term goals.

  1. Healthy Work Environment

The significance of organizational behavior can be understood in the context of a healthy work environment—one where team members trust each other and work in tandem with each other. Being on good terms with your coworkers means that you can work together to achieve your objectives. Mutual respect across departments and levels constitutes an effective organizational behavior strategy.

The importance of organizational behavior isn’t restricted to how well employees perform. It also determines the smooth functioning of the day-to-day activities within an organization. Hence, the management should aspire to create a harmonious, flexible and accessible work environment.

You may prefer to work in an autonomous work environment as opposed to a traditional hierarchical setup. It’s important to identify what your strengths, values and beliefs are best suited for before you join an organization. Learn more about assessing your culture fit with Harappa’s Navigating Workplaces course. Identify stakeholders, make better decisions and understand power structures to get a deeper understanding of organizational behavior. Effective management is possible when roles are defined. Organizational behavior helps you do that and much more.


Explore topics such as Stakeholder ManagementStakeholder AnalysisTypes of Stakeholders & Organizational Behavior Theory from Harappa Diaries and learn to navigate professional relationships better.

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