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1.  Discuss three ways to decrease a conflict situation. In particular, be sure to include the pros and cons of each approach in your response. 

An Introduction to
Organizational Behavior

v. 1.1

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This is the book An Introduction to Organizational Behavior (v. 1.1).

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ii

Table of Contents

About the Authors………………………………………………………………………………………………….. 1

Acknowledgments ………………………………………………………………………………………………….. 3

Dedications …………………………………………………………………………………………………………….. 6

Preface……………………………………………………………………………………………………………………. 7

Chapter 1: Organizational Behavior ……………………………………………………………………. 10
College Textbook Revolution: The Case of Unnamed Publisher ……………………………………………………. 11

Understanding Organizational Behavior……………………………………………………………………………………… 15

Understanding Your Learning Style ……………………………………………………………………………………………. 25

Understanding How OB Research Is Done ……………………………………………………………………………………. 29

Trends and Changes……………………………………………………………………………………………………………………. 35

Maintaining Core Values: The Case of Nau ………………………………………………………………………………….. 44

Conclusion …………………………………………………………………………………………………………………………………. 47

Exercises…………………………………………………………………………………………………………………………………….. 48

Chapter 2: Managing Demographic and Cultural Diversity ……………………………….. 49
Doing Good as a Core Business Strategy: The Case of Goodwill Industries …………………………………….. 51

Demographic Diversity ……………………………………………………………………………………………………………….. 54

Cultural Diversity ……………………………………………………………………………………………………………………….. 78

The Role of Ethics and National Culture………………………………………………………………………………………. 90

Managing Diversity for Success: The Case of IBM ………………………………………………………………………… 94

Conclusion …………………………………………………………………………………………………………………………………. 98

Exercises…………………………………………………………………………………………………………………………………….. 99

Chapter 3: Understanding People at Work: Individual Differences and

Perception ………………………………………………………………………………………………………….. 101
Advice for Hiring Successful Employees: The Case of Guy Kawasaki …………………………………………… 102

The Interactionist Perspective: The Role of Fit ………………………………………………………………………….. 106

Individual Differences: Values and Personality ………………………………………………………………………….. 109

Perception………………………………………………………………………………………………………………………………… 130

The Role of Ethics and National Culture…………………………………………………………………………………….. 142

Using Science to Match Candidates to Jobs: The Case of Kronos …………………………………………………. 147

Conclusion ……………………………………………………………………………………………………………………………….. 150

Exercises…………………………………………………………………………………………………………………………………… 151

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Chapter 4: Individual Attitudes and Behaviors …………………………………………………. 154
People Come First: The Case of SAS …………………………………………………………………………………………… 155

Work Attitudes …………………………………………………………………………………………………………………………. 158

Work Behaviors ………………………………………………………………………………………………………………………… 170

The Role of Ethics and National Culture…………………………………………………………………………………….. 186

Rebounding from Defeat: The Case of Jeffrey Katzenberg ………………………………………………………….. 189

Conclusion ……………………………………………………………………………………………………………………………….. 192

Exercises…………………………………………………………………………………………………………………………………… 193

Chapter 5: Theories of Motivation …………………………………………………………………….. 196
A Motivating Place to Work: The Case of Zappos ……………………………………………………………………….. 198

Need-Based Theories of Motivation …………………………………………………………………………………………… 201

Process-Based Theories …………………………………………………………………………………………………………….. 211

The Role of Ethics and National Culture…………………………………………………………………………………….. 229

Motivation in Action: The Case of Trader Joe’s ………………………………………………………………………….. 232

Conclusion ……………………………………………………………………………………………………………………………….. 235

Exercises…………………………………………………………………………………………………………………………………… 236

Chapter 6: Designing a Motivating Work Environment ……………………………………. 240
Motivating Steel Workers Works: The Case of Nucor …………………………………………………………………. 241

Motivating Employees Through Job Design ……………………………………………………………………………….. 244

Motivating Employees Through Goal Setting …………………………………………………………………………….. 258

Motivating Employees Through Performance Appraisals …………………………………………………………… 267

Motivating Employees Through Performance Incentives …………………………………………………………… 276

The Role of Ethics and National Culture…………………………………………………………………………………….. 283

Motivation Key for Success: The Case of Xerox ………………………………………………………………………….. 287

Conclusion ……………………………………………………………………………………………………………………………….. 290

Exercises…………………………………………………………………………………………………………………………………… 291

Chapter 7: Managing Stress and Emotions………………………………………………………… 293
Facing Foreclosure: The Case of Camden Property Trust ……………………………………………………………. 294

What Is Stress? …………………………………………………………………………………………………………………………. 297

Avoiding and Managing Stress ………………………………………………………………………………………………….. 313

What Are Emotions? …………………………………………………………………………………………………………………. 325

Emotions at Work……………………………………………………………………………………………………………………… 330

The Role of Ethics and National Culture…………………………………………………………………………………….. 338

Getting Emotional: The Case of American Express……………………………………………………………………… 341

Conclusion ……………………………………………………………………………………………………………………………….. 344

Exercises…………………………………………………………………………………………………………………………………… 345

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Chapter 8: Communication ………………………………………………………………………………… 349
You’ve Got Mail…and You’re Fired! The Case of RadioShack ………………………………………………………. 350

Understanding Communication ………………………………………………………………………………………………… 354

Communication Barriers …………………………………………………………………………………………………………… 360

Different Types of Communication and Channels ………………………………………………………………………. 377

The Role of Ethics and National Culture…………………………………………………………………………………….. 397

Employee Satisfaction Translates to Success: The Case of Edward Jones …………………………………….. 402

Conclusion ……………………………………………………………………………………………………………………………….. 405

Exercises…………………………………………………………………………………………………………………………………… 406

Chapter 9: Managing Groups and Teams …………………………………………………………… 410
Teamwork Takes to the Sky: The Case of General Electric ………………………………………………………….. 411

Group Dynamics ……………………………………………………………………………………………………………………….. 415

Understanding Team Design Characteristics……………………………………………………………………………… 428

Management of Teams ……………………………………………………………………………………………………………… 445

Barriers to Effective Teams ……………………………………………………………………………………………………….. 452

The Role of Ethics and National Culture…………………………………………………………………………………….. 454

Green Teams at Work: The Case of New Seasons Market ……………………………………………………………. 457

Conclusion ……………………………………………………………………………………………………………………………….. 460

Exercises…………………………………………………………………………………………………………………………………… 461

Chapter 10: Conflict and Negotiations ………………………………………………………………. 462
Negotiation Failure: The Case of the PointCast ………………………………………………………………………….. 463

Understanding Conflict …………………………………………………………………………………………………………….. 466

Causes and Outcomes of Conflict……………………………………………………………………………………………….. 472

Conflict Management ……………………………………………………………………………………………………………….. 478

Negotiations……………………………………………………………………………………………………………………………… 486

The Role of Ethics and National Culture…………………………………………………………………………………….. 503

Avoiding Conflict at WorldCom: The Case of Bernard Ebbers……………………………………………………… 506

Conclusion ……………………………………………………………………………………………………………………………….. 510

Exercises…………………………………………………………………………………………………………………………………… 511

Chapter 11: Making Decisions ……………………………………………………………………………. 515
Decision-Making Culture: The Case of Google ……………………………………………………………………………. 516

Understanding Decision Making ……………………………………………………………………………………………….. 520

Faulty Decision Making …………………………………………………………………………………………………………….. 535

Decision Making in Groups ……………………………………………………………………………………………………….. 540

The Role of Ethics and National Culture…………………………………………………………………………………….. 549

Empowered Decision Making: The Case of Ingar Skaug ……………………………………………………………… 552

Conclusion ……………………………………………………………………………………………………………………………….. 555

Exercises…………………………………………………………………………………………………………………………………… 556

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Chapter 12: Leading People Within Organizations ……………………………………………. 562
Taking on the Pepsi Challenge: The Case of Indra Nooyi ……………………………………………………………. 564

Who Is a Leader? Trait Approaches to Leadership ……………………………………………………………………… 568

What Do Leaders Do? Behavioral Approaches to Leadership………………………………………………………. 575

What Is the Role of the Context? Contingency Approaches to Leadership ………………………………….. 580

What’s New? Contemporary Approaches to Leadership …………………………………………………………….. 589

The Role of Ethics and National Culture…………………………………………………………………………………….. 607

Leadership Development: The Case of Starbucks ……………………………………………………………………….. 612

Conclusion ……………………………………………………………………………………………………………………………….. 615

Exercises…………………………………………………………………………………………………………………………………… 616

Chapter 13: Power and Politics ………………………………………………………………………….. 619
Focus on Power: The Case of Steve Jobs……………………………………………………………………………………… 620

The Basics of Power ………………………………………………………………………………………………………………….. 623

The Power to Influence …………………………………………………………………………………………………………….. 630

Organizational Politics ……………………………………………………………………………………………………………… 647

Understanding Social Networks ………………………………………………………………………………………………… 654

The Role of Ethics and National Culture…………………………………………………………………………………….. 658

Getting Connected: The Case of Social Networking ……………………………………………………………………. 662

Conclusion ……………………………………………………………………………………………………………………………….. 665

Exercises…………………………………………………………………………………………………………………………………… 666

Chapter 14: Organizational Structure and Change …………………………………………… 675
Organizational Structure: The Case of Toyota ……………………………………………………………………………. 676

Organizational Structure ………………………………………………………………………………………………………….. 680

Organizational Change ……………………………………………………………………………………………………………… 693

The Role of Ethics and National Culture…………………………………………………………………………………….. 713

Changing for Good: The Case of Hanna Andersson Corporation …………………………………………………. 716

Conclusion ……………………………………………………………………………………………………………………………….. 720

Exercises…………………………………………………………………………………………………………………………………… 721

Chapter 15: Organizational Culture …………………………………………………………………… 723
Building a Customer Service Culture: The Case of Nordstrom ……………………………………………………. 724

Understanding Organizational Culture ……………………………………………………………………………………… 727

Characteristics of Organizational Culture ………………………………………………………………………………….. 732

Creating and Maintaining Organizational Culture ……………………………………………………………………… 744

Creating Culture Change …………………………………………………………………………………………………………… 764

The Role of Ethics and National Culture…………………………………………………………………………………….. 769

Clash of the Cultures: The Case of Newell Rubbermaid ………………………………………………………………. 772

Conclusion ……………………………………………………………………………………………………………………………….. 775

Exercises…………………………………………………………………………………………………………………………………… 776

vi

About the Authors

Talya Bauer

Talya Bauer (Ph.D., 1994, Purdue University) is the Gerry
and Marilyn Cameron Professor of Management at
Portland State University. Dr. Bauer is an award-
winning teacher who specializes in teaching
organizational behavior, management, power and
influence, and negotiations, as well as training and
development at the graduate and undergraduate level.
She conducts research about relationships at work.
More specifically, she works in the areas of leadership,
selection, and new employee onboarding, which has
resulted in dozens of journal publications. She has acted
as a consultant for a variety of government, Fortune
1000, and start-up organizations. Dr. Bauer is involved
in professional organizations and conferences at the national level, such as serving
on the Human Resource Management Executive Committee of the Academy of
Management and SIOP Program Chair and member-at-large for SIOP. She is the
editor of Journal of Management and is on the editorial boards for the Journal of
Applied Psychology and Industrial and Organizational Psychology: Perspectives on Science
and Practices, was recognized as one of the most published authors of the 1990s, and
is a Fellow of SIOP and APS.

Berrin Erdogan

Berrin Erdogan (Ph.D., 2002, University of Illinois at
Chicago) is the Express Employment Professionals
Endowed Professor at Portland State University. Dr.
Erdogan is an award-winning teacher who teaches
management, organizational behavior, and human
resources management. Her research interests focus on
individual attachment to organizations through
fairness, leader-subordinate relations, contextual
factors such as organizational culture, and person-
organization fit. Her work has been published in
journals such as Academy of Management Journal, Journal
of Applied Psychology, and Personnel Psychology. She has
conducted managerial seminars on the topics of

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motivation, organizational justice, performance appraisals, and training and
development, and has worked as a corporate trainer. She serves on the editorial
boards of Journal of Applied Psychology, Journal of Management, Journal of Organizational
Behavior, and Personnel Psychology.

About the Authors

2

Acknowledgments

We want to thank Margaret Lannamann and Brett Guidry for doing such a great job
keeping all the balls in the air, and Jeff Shelstad and Eric Frank for having the vision
and persistence to bring Unnamed Publisher into being, and their faith in us as
among the first Unnamed Publisher authors. Many thanks to Andrea Meyer, Sharon
Koch, Pamela Tierney, Dean Scott Dawson, and Portland State University for
supporting our work.

We would also like to thank the following colleagues whose comprehensive
feedback and suggestions for improving the material helped make this a better text:

Cheryl Adkins, Longwood University

Sid Barsuk, Governors State University

Carrie Blair, College of Charleston

Pamela Buckle Henning, Adelphi University

Claudia Cogliser, Texas Tech

Leslie Connell, University of Central Florida

Donald Dahlin, The University of South Dakota

Deborah Good, University of Pittsburgh

Gideon Falk, Purdue University, Calumet

David Futrell, Butler University

Bruce Gillies, California Lutheran University

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Michael Hadani, Long Island University, CW Post Campus

Jeff Haldeman, Webster University

Kathy Harris, Northwestern Oklahoma State University

Kelly Kilcrease, University of New Hampshire, Manchester

Antoinette S. Knechtges, Eastern Michigan University

Michael Komos, Benedictine University

Damian Lonsdale, University of South Dakota

Don McCormick, California State University, Northridge

Janet Moen, The University of North Dakota

Lorrie Mowry, McCook Community College

Peter Nowak, Boston College, Boston University, Suffolk University

Samuel Rabinowitz, Rutgers University

Gary Renz, Webster University

Brenda Riddick, California State University, Dominguez Hills

Laura Riolli, California State University, Sacramento

Mark Schwiesow, Marquette University

Leslie Shore, Metropolitan State University

Valarie Spiser-Albert, University of Texas at San Antonio

Acknowledgments

4

Christy Weer, Salisbury University

Marilyn Wesner, George Washington University

Jim Woodrum, University of Wisconsin-Madison

The authors also appreciate the efforts of those instructors who have contributed to
the project with their work on supplementary materials. Deborah Good from the
University of Pittsburgh developed the Student Quizzes and the Test Item File, and
Frank Markham from Mesa State College, along with his wife Marylin, created the
PowerPoint slide presentation.

In addition, two instructors assisted the development of this material by using it in
their classrooms. Their input, along with their students’ feedback, has provided us
with valuable feedback and confirmation that the material is effective in the
classroom:

Pamela Henning, Adelphi University School of Business

Jim Woodrum, University of Wisconsin School of Business

The cadre of copy editors, graphics designers, and technical designers involved in
this first-of-its-kind global publishing project also garner our heartfelt thanks.
Finally, this book would not have the incredible value and meaning it does without
the support and interest of the faculty and students who have commented on early
iterations, and will serve to make this ‘their book’ in the many years to come.

Acknowledgments

5

Dedications

Talya Bauer

This book is dedicated to Jo Ann and Frank Bauer, who fueled my desire to learn,
read, and write and to my husband, Horst, and our children, Nicholas and
Alexander, who are carrying on the tradition.

Berrin Erdogan

This book is dedicated to my parents, Ilhan and Fulda Erdogan, who were my role
models and first introduction to life in academia. I also dedicate this book to my
husband, Emre, and our son, Devin, for their love and support.

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Preface

To love what you do and feel that it matters—how could anything be more fun?

– Katherine Graham

This quote sums up how we feel about teaching. What could be better than
teaching? It is fun, at times exciting, and it really matters. And one of the best
courses in the world to teach is Organizational Behavior. Together we have been
teaching for over 29 years and have taught thousands of students at the
undergraduate, master’s, and doctoral levels. Our teaching styles are different, but
we share some common values when it comes to teaching, including the beliefs
that:

• Organizational Behavior matters
• Evidence-based research is the foundation of Organizational Behavior
• Different students learn in different ways
• There is no substitute for hands-on learning
• Learning the language of OB helps you be more effective in the

workplace
• Technology can greatly enhance learning
• Flexibility in teaching delivery allows for student success

Not “Just Another” Textbook

When we thought about writing a textbook, we knew we didn’t want to write “just
another” OB book. Enter Unnamed Publisher. Their model solves many of the
common challenges faculty and students face when it comes to textbooks. Here are
a few that have always bothered us and that Flat World has solved:

• “I had to buy the whole book, but my teacher didn’t use the XYZ chapter.”
This isn’t a problem with our book because faculty can rearrange
chapters as well as add and delete them.

• “Textbooks are too expensive!” Textbooks have traditionally been very
expensive and the business model of traditional publishing firms has
been a huge part of those costs. With our book, students get to choose
how to read the material in a number of inexpensive formats ranging
from online viewing, black-and-white or color books, audio chapters,
or printable PDFs.

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• “New editions come out too quickly and don’t really change.” The reason
that new editions come out is because used books don’t make money
for the publishers, but new ones do. With our book, you can change
editions when you want and when you