Organizational behavior is a field of study about how people and groups behave in organizations. Human resources management adopts organizational behavior theories and applies them in real-life organizational settings. Firms that best use the potential of their human resources are the winners in today's competitive economy. A basic grasp of organizational behavior theories can help business managers improve the performance of their employees.


Organizational behavior covers diverse theories, but organizational behavior researchers and human resources managers are concerned with two outcomes: job performance and organizational commitment. Job satisfaction is how employees feel about the tasks they need to complete. Higher job satisfaction leads to better motivation to perform the job well. Organizational success also requires a strong level of commitment from all employees to the values, vision and objectives of the organization.

Individual Behavior

A range of theories in organizational behavior deals with how perceptions, attitudes and personalities of employees influence work-related issues such as motivation, commitment and learning. For example, value theory is an approach to job satisfaction that argues anything can be a source of job satisfaction as long as it is something the employee values. It focuses on discrepancies between what people have and what they desire: the greater those discrepancies, the less satisfied they are.

Group Dynamics

Employees typically work in teams. Group mechanisms influence job satisfaction, motivation and learning in numerous ways. Research tries to determine barriers to team effectiveness. One such barrier is insufficient training. Team members must have the right blend of skills needed to contribute to the organization's objectives. Other barriers are: compensation systems focused on individual performance rather than group performance, lack of cooperation between teams and lack of support from managers or employees.

Organizational Mechanisms

Employees are members of an organization, whether they work individually or in teams. The organization is an entity that affects the performance of employees and teams through such mechanisms as organizational structure and culture. The organizational chart shows the formal communication channels in an organization. However, a lot of communications are channeled through informal communication conduits. Rumors are a byproduct of informal communication. Organizational culture is made up of the shared beliefs and values of people in the organization. Organizational culture affects important issues such as sensitivity to customer needs, freedom to experiment with new ideas and tolerating risk.