Midterm

Human Behaviour in
Organization
CHAPTER 1: AN OVERVIEW OF HUMAN BEHAVIOR IN
ORGANIZATIONS

What is Human Behavior?

Human behavior refers to the physical actions of a person that can be seen
or heard such as smiling or whistling.
With his thoughts, feelings, emotions, and sentiments, the persons exhibits
behaviors similar or different when he is in or out of organizations.

What is Organizational Behavior?

Organizational behavior or OB may be defined as “ the study of human
behavior in organization, of the interactions between individuals and the
organization, and of the organization itself. “

The Goals of OB
The three Goals of OB are as follows:
1. To explain behavior;
2. To predict behavior; and
3. To control behavior.

The elements of OB
Four Elements Operate in OB. They are:
 People
 Structure
 Technology
 Environment

The benefits odf studying organizational behavior (OB).

The study of OB offers certain benefits. They are as follows:
1. Development of people skills;
2. Personal growth;
3. Enhancement of organizational and individual effectiveness; and
4. Sharpening and refinement of common sense.

1. DEVELOPMENT OF PEOPLE SKILLS

There are two type of skills that a person will need to succeed in his chosen
career:
 The skill in doing his work; and
 The skill in relating with people.
2. PERSONAL GROWTH
Personal growth makes a person highly competitive in the workplace. The
chance to achieve personal growth is enhanced by knowledge of OB.
Intrapersonal thinking may be described briefly as one possessed by a
person with highly accurate understanding of himself or herself.

3. ENHANCEMENT OF ORGANIZATIONAL AND INDIVIDUAL

EFFECTIVENESS.
Effectiveness is a major attribute of successful organizations, as well as
individuals. When the right decisions are made, effectiveness follows.

4. SHARPENING AND REFINEMENT OF COMMON SENSE.

People differ in the degree of common sense they possess. Improvements in
this type of ability however, can still be made and great benefits can be derived if
this is done.

A brief history of Organizational Behavior (OB)

The origins of OB can be traced to the ff:
1. The human relations approach
a. the scientific management approach by Frederick W. Taylor
b. the human relations approach by Elton Mayo and others
2. The personality theories
a. Freud’s model
b. the behaviorist approach by Watson and Skinner
c. the humanist approach by Carl Rogers, Fritz Perls, and Abraham Maslow

Frederick W. Taylor
 He was the well-known disciple of the scientific management movement.
 the primary purpose of scientific management was the application of scientific
methods to increase the individuals workers productivity.

Elton Mayo
 His research team conducted the Hawthorne studies in 1920 to determine
what effect hours of work, periods of rests and lighting might have on worker
fatigue and productivity.
 it was discovers that social environment have and equivalent if not greater of
effect of productivity than the physical environment.

Sigmund Freud
 brought the idea that people are motivated by far more than conscious logical
reasoning.
 Freud believed that irrational motives make up the hidden subconscious
mind, which determines the major part of peoples behavior.

J.B. Watson
 an eminent psychologist, formulated the theory about learned behavior or
behaviorism. This theory indicated that a person can be trained to behave
according to the wish of the trainer.

B.F. Skinner
 extended Watson’s theory with his own theory of behavior modification.
Skinner concluded that when people received a positive stimulus like money
or praise for what they have done , they will tend to repeat their behavior.
 When they are ignored and received no response to the action, they will not
be inclined to repeat it.

Rogers
 focused on the person as an individual instead of adhering to a rigid
methodology.

Perls
 contribution is the Gestalt psychology wherein the person is seen as being
plagued by numerous split, or conflicting desires and needs, which dissipate
energy and interfere with that persons ability to achieve his potential.

Abraham Maslow
 forwarded his model which espouses the idea of developing the personality
toward the ultimate achievement of human potential.

ETHICS AND ORGANIZATIONAL BEHAVIOR

What is ethics?
Ethics refers to the set of moral choices a person makes based on what he or
she ought to do.
Organization Ethics these are moral principles that define right or wrong
behavior in organizations.
Ethical behaviors. This refers to behavior that is accepted as morally
“good” and “right” as opposed to “ bad” and “wrong”.
What constitutes right and wrong behavior in organization is determined
by:
 The public
 Interest groups
 Organizations
 The individuals personal morals and values
ETHICAL ISSUES
There are important ethical issues that confront organization. They consist of the
following:
 Conflict of interest
 Fairness and honesty
 Communication
 Relationships within the organization
CHAPTER 2: INDIVIDUAL DIFFERENCES, MENTAL ABILITY, AND
PERSONALITY

Individual Differences
Refer to the variation in how people respond to the same situation based on
personal characteristics.

Consequences of Individual Differences

 People differ in productivity;
 People differ in the quality of their work;
 People react differently to empowerment;
 People react differently to any style of leadership;
 People differ in terms of need for contact with other people;
 People differ in terms of commitment to the organization; and
 People differ in terms of level of self-esteem

1. Productivity
 Refers to rate of output per worker.
 It differs from person to person.
2. Quality of their work
 Because people are different from each other, it is not surprising that the
quality of their work will also be different. Some individuals will not be
contented in making products of mediocre quality, while others just strive to
produce outputs that barely passed standard requirements.
3. Empowerment
 Means giving someone the power to do something.
 For instance, an individual may be empowered to sign purchased contracts
and with it the authority to determine what supplies and materials ae needed
to be purchase.
4. Style of Leadership
 If all subordinates in a given unit will respond well to a single style of
leadership, managing them or simply relating with them would be a much
easier task. But this is not so, as some people will prefer a leader with a
democratic style, while some will need close supervision from their superiors.
5. The need for contact with other people
 Regarding the need for social contact, people are also different from one
another. Some will need more contact, while others can work alone the whole
day. Other people cannot be productive unless they meet people as they work.
6. Commitment to the Organization
 Varies among individuals. Some are so committed and loyal to the
organization that they work the whole day without noticing that they are
putting in more than the required working hours.
7. Level of Self-esteem
 Those with low self-esteem tend to be less productive. They also avoid
accepting more responsibilities.
 The opposite happens when people have high regard of themselves. Many
great inventions, literary work, and discoveries were made by people with
high self-esteem.

WHAT MAKES PEOPLE DIFFERENT FROM EACH OTHER

1. Demographic Diversity
Performance in the workplace and the behavior of workers are sometimes
affected by the differences between the demographic characteristics of individual
workers.
The sources of demographic diversity include the following:
1. Gender
2. Generational differences and age; and
3. Culture
Gender Differences
The differences in the perception of male and female roles.
Specifically, men and women are not different along the following concerns:
1. Problem solving abilities
2. Analytical skills
3. Competitive drive
4. Motivation
5. Learning ability
6. Sociability
Generational and Age-Based Differences
A worker that belongs to a certain generation may behave differently from
a worker who belongs to another.
Culture
Refers to the learned and shared ways of thinking and acting among a
group of people or society.
This definition implies that culture has two dimensions:
 Social culture- which refers to the social environment of human-created
beliefs , customs, knowledge, and practices that define conventional behavior
in a society.
 Organizational culture- is the set of values, beliefs, and norms that is shared
among members of an organization.
2. Aptitude and Ability
Aptitude - May be defined as the capacity of a person to learn or acquire skills.
Ability - Refers to an individual’s capacity to perform the various tasks in a job.

Aptitudes and abilities are very important consideration when people are
considered for employment in an organization. The managers of business firms
will be much concerned with the cost of training new employees before they
become productive. Low aptitude and abilities would mean higher training costs.

A person’s overall abilities are made up of two (2) sets of factors:

1. Physical ability
Refers to the capacity of the individual to do tasks demanding stamina,
dexterity, strength, and similar characteristics.
Specifically, there are nine (9) physical abilities needed to perform certain tasks.
These are the following:
1. Dynamic strength- this is the ability to exert muscular force repeatedly or
continuously over time.
2. Trunk strength- this is the ability to exert muscular strength using the
trunk (particularly the abdominal muscles) muscles.
3. Static strength- this is the ability to exert force against external objects.
4. Explosive strength- this is the ability to expend a maximum of energy in
one or a series of explosive acts.
5. Extent flexibility- this is the ability to move the trunk and back muscles
as far as possible.
6. Dynamic flexibility- this is the ability to make rapid, repeated flexing
movements.
7. Body coordination- this is the ability to coordinate the simultaneous
actions of different parts of the body.
8. Balance- this is the ability to maintain equilibrium despite forces pulling
off balance.
9. Stamina- this is the ability to continue maximum effort requiring
prolonged effort over time.

2. Intellectual or mental ability

 (also referred to as intelligence) is one of the major sources of individual
differences.
 Refer to the capacity to do mental activities, such as thinking, reasoning, and
problem solving.
Dimensions of Intellectual Ability
 Intelligence is composed of four(4) subparts which are as follows:
1. Cognitive
 2. Social
3. Emotional
4. cultural
Cognitive intelligence - refers to the capacity of a person to acquire and apply
knowledge including solving problems.
Social intelligence - refers to a person’s ability to relate effectively with others.
Emotional intelligence - refers to a person’s qualities such as understanding one’s
own feelings, empathy for others, and the regulation of emotion to enhance
living.
Cultural intelligence - refers to an outsider’s ability to interpret someone’s
unfamiliar and ambiguous behavior the same way that person’s compatriot
would.

Intelligence Subparts and Individual Variations

An individual could get high ratings on two intelligence subparts, e.g.,
cognitive ad social but low on emotional and cultural. Another person could be
rated average on all four subparts, and the like.

The Triarchic Theory of Intelligence

 An eminent researcher, Robert Sternberg, developed an approach to the study
of intelligence , which is now known as the triarchic theory of intelligence.
 He maintains that there are three(3) important parts of intelligence, namely;
1. Componential intelligence;
2. Experiential intelligence; and
3. Contextual intelligence

Componential intelligence
- Also referred to as analytical intelligence, it involves components (or
mental processes) used in thinking.
Experiential intelligence
- Also referred to as creative intelligence, is that type of intelligence that
focuses on how people perform on tasks with which they have either little
or no previous experience or else great experience.
- It is the type of intelligence that is required for imagination and combining
things in novel ways.
Contextual intelligence
- Also known as practical intelligence, is a type of everyday intelligence or
street smarts.
- It requires adapting to, selecting, and shaping our real-world environment.
Incorporates the ideas of common sense, wisdom and street smarts.
Multiple Intelligences
 Another eminent researcher, Howard Gardner, developed a very useful means
of understanding intelligence. It is referred to as the Theory of Multiple
Intelligences.
 He proposes eight(8) different components of intelligence which the
individual possesses in varying degrees.

A brief description of the components is provided as follows:

1. Linguistic
‐ People who possess this component of intelligence is sensitive to language,
meanings, and the relations among words.
‐ Linguistic intelligence makes people to communicate through language
including reading, writing, and speaking.
‐ This is a distinct characteristics of novelist, poets, copywriter, scriptwriter,
editors, magazine writers, public relations directors, and speech writers.
2. Logical-Mathematical
‐ This intelligence component covers abstract thought, precision, counting,
organization, and logical structure, enabling the individual to see relationship
between objects and solve problems such as those in algebra and actual
concerns.
‐ This is a characteristic of mathematicians, scientists, engineers, animal
trackers, police investigators, and lawyers.
3. Musical
‐ This intelligence component gives people the capacity to create and
understand meanings made out of sounds and to enjoy different types of
music.
‐ Is found in performers, composers, conductors, musical audience, recording
engineers, and makers of musical instruments.
4. Spatial
‐ This intelligence component enables people to perceive and manipulate
images in their brain and to re-create them from memory, such as in making
graphic designs.
‐ Is found in architects, painters, sculptors, navigators, chess players theoretical
physicians, and battlefield commanders.
5. Bodily-kinesthetic
‐ This intelligence enables people to use their body and perceptual and motor
systems in skilled ways, such as dancing, playing sports, and expressing
emotion through facial expressions.
‐ Is found in athletes, dancers, actors, inventors, mimers, surgeons, karate
teachers, and the mechanically gifted.
6. Intrapersonal
‐ Has highly accurate understanding of himself or herself. He or she is sensitive
to his or her values, purpose, feelings, and has a developed sense of self.
‐ Is found in novelists, counselors, wise elders, philosophers, gurus and persons
with deep sense of self.
7. Interpersonal
‐ This intelligence component makes it possible for persons to recognize and
make distinctions among the feelings, motives, and intentions of others, as in
managing people and parenting children.
‐ Is found in politicians, teachers, religious leaders, counselors, salesman, and
managers.
8. Naturalist
‐ A person with this intelligence possesses the ability to seek patterns in the
external physical environment.

Personality
 Refers to the sum total of ways in which an individual reacts and interacts
with others.
 The “ways “ are the patterns of behavior that are consistent and enduring.
Determinants of Personality
 Heredity defines the limits by which environment can develop personality
characteristics.
Hereditary factors are those factors that are determined at conception. These
include the following:
1. Physical stature
2. Facial attractiveness
3. Gender
4. Temperament
5. Muscle composition and reflexes
6. Energy level
7. Biological rhythms
 Environmental factors are those that exert pressures on the formation of an
individual’s personality. It includes the following:
1. Cultural factor- which refer to the established norms, attitudes, and values
that are passed along from one generation to the next and creates
consistency over time.
2. Social factor- which refer to those that reflect family life, religion and the
many kinds of formal and informal groups in which the individual
participates throughout his life.
3. Situational factors- which indicate that the individual will behave
differently in different situations.
Personality Factors and Traits
The eight (8) factors are briefly described below:
1. Emotional stability- this personality factor characterize one as calm, self-
confident, and secure. Its opposite is emotional instability characterized by
nervousness, depression, and insecurity.
2. Extraversion- this is the personality factor describing someone who is
sociable, gregarious, and assertive. The opposite is introversion, which
describes a person who tends to be reserved, timid, and quiet
3. Openness to experience - this is a personality factor describing a person
who is imaginative, cultured, curious, original, broad-minded, intelligent,
and artistically sensitive. The opposite is the person who is conventional
and finds comfort in the familiar.
4. Agreeableness - this factor refers to the person’s interpersonal orientation.
5. Conscientiousness - this factor refers to a person’s reliability.
6. Self-monitoring behavior - this reflects a person’s ability to adjust his or
her behavior to external, situational or environmental factors.
7. Risk taking and thrill seeking - these refers to the person’s willingness to
take risk and pursue thrills that sometimes are required in the workplaces.
8. Optimism - this refers to the tendency to experience positive emotional
states and to typically believe that positive outcomes will be forthcoming
from most activities.

Table 1
PERSONALITY AND TRAITS
FACTORS FACTORS
1. Emotional stability
a. Emotionally stable person - calm, self-confident, secure
b. Emotionally unstable person - nervous, depressed, insecure
2. Extraversion
a. Extravert - sociable, gregarious, assertive
b. Introvert - reserved, timid, quiet
3. Openness to experience
a. Open minded person - Imaginative, cultured, curious,
original, broad-minded, intelligent,
artistically sensitive
b. Closed minded person - Conventional, finds comfort in the
familiar
4. Agreeableness
a. Agreeable person -cooperative, warm, trusting
b. Disagreeable person -Cold, disagreeable, antagonistic
5. Conscientiousness
 a. Highly conscientious person - Responsible, organized, dependable,
persistent
b. Person with low score on - Easily distracted, disorganized,
conscientiousness unrealible
6. Self-monitoring behavior
a. High self-monitor - Pragmatic, chameleon-like actor in
social groups, often say what others
want to hear
b. Low self-monitor - Avoid situations that require him/her
to adapt to different outer images, is
often inflexible
7. Risk taking and thrill seeking
a. Risk taker - Willingness to take risks and pursue
thrills
b. Play safe person - Not willing to take risks and pursue
thrills
8. Optimism
a. Optimist - Tendency to experience positive
emotional states and to believe that
positive outcome will be forthcoming
from most activities
b. Pisimist - Tendency to experience negative
emotional states and to typically
believe that negative outcomes will be
forthcoming from most activities

EMOTIONAL INTELLIGENCE
 The concept of emotional intelligence or emotional quotient (EQ) was
introduced by Daniel Goleman.
 EQ refers to the ability of the person to accurately perceive, evaluate, express
and regulate emotions and feelings.
The five (5) components of EQ are the following:
1. Self-regulation - this refers to the ability to calm down anxiety, control
impulsiveness, and react appropriately to anger.
2. Motivation - this refers to the passion to work for reasons that go beyond
money or status.
3. Empathy - this refers to the ability to respond to the unspoken feelings of
others.
 4. Self-awareness - this refers to the awareness of one’s own personality or
individuality.
5. Social skills - this refers to the proficiency to manage relationships and
building networks.

MORE ON PHYSICAL ABILITY

This writer feels that the following factors are important in determining the
reasons for differences in individual behavior:
1. Sense of sight - people differ in what they actually see.
2. Sense of hearing - people differ in their ability to hear.
3. Sense of taste - a person’s tongue may be sensitive to various tastes and
this makes him or her different from another person who is less sensitive
to taste.
4. Sense of smell- people have different degrees of sensitivity to smell.
5. Sense of touch - a person’s sense of touch may differ in degree with
another person’s. As such, their behavior will differ when confronted with
similar situations.
CHAPTER 3: LEARNING, PERCEPTION, AND ATTRIBUTION

What is LEARNING
- may be defined as a relatively permanent change in behavior or
knowledge due to experience. When a person behaves differently from what he
previously did, it can be said that there is change in person’s behavior.

A change in behavior happens due to any or both of the following:

Learning; or
Other causes such as drugs, injury, disease and maturation.

THEORIES OF LEARNING:
 Classical Conditioning
 Operant Conditioning
 Social Learning

1. CLASSICAL CONDITIONING
- may be defined as a type of learning in which a stimulus acquires the
capacity to evoke a response that was originally evoked by another stimulus. A
stimulus is something that incites action.

2. OPERANT CONDITIONING
- may be defined as a type of learning where people learn to repeat
behaviors that bring them pleasurable outcomes and to avoid behaviors that lead
to uncomfortable outcomes.

3. SOCIAL LEARNING
- may be defined as the process of observing the behavior of others,
recognizing its consequences, and altering behavior as a result. One of the ways
by which people learn is through social contacts with other people.

How Social Learning is achieved

 By observing what happens to other people;
 By being told about something; and
 Through direct experience

What is PERCEPTION
-may be defined as the process by which people select, organize, interpret,
retrieve, and respond to information from their environment.
Factors influencing Perception
Perception is influenced by the characteristics of the following:
 The perceiver
 The target
 The situation

1. The Perceiver
the person who receives the target is the perceiver. His perception of the
target is influenced by factors that are unique to him, like the following:
 His past experiences
 His needs or motives
 His personality
 His values and attitudes

A person’s experiences in the past have some bearing on his current

perceptions.

2. The Target
The person, object, or event that is perceived by another person is the
target. Perception may be modified by the following factors which are typical
characteristics of targets:
1. Contrast-
Merriam-Webster (noun)
a: juxtaposition of dissimilar elements (such as color, tone, or emotion) in
a work of art
b: degree of difference between the lightest and darkest parts of a picture
a: the difference or degree of difference between things having similar or
comparable natures the contrast between the two forms of government
b: comparison of similar objects to set off their dissimilar
qualities By contrast with newer models, the computer operates slowly.
: the state of being so compared In contrast to the other estimates, his
was very high.
: a person or thing that exhibits differences when compared with
another The gentle girl is a contrast to the arrogant woman.

2. Intensity-the quality or state of being intense especially : extreme degree of

strength, force, energy, or feeling
-the magnitude of a quantity (such as force or energy) per unit (as
of area, charge, mass, or time)
3. Figure-ground separation-refers to how we perceive objects to
 differentiate the main thing we are looking at from its background. We
utilize
different perceptual clues to help us do this, including blurriness, contrast,
size differences, and separation between the figure and background.
4. Size-noun: the relative extent of something; a thing's overall dimensions or
magnitude; how big something is.
5. Motion-is when an object changes its position with respect to a reference
point in a given time.
6. Repetition or novelty- a: the act or an instance of repeating or
being repeated b: a motion or exercise (such as a push-up) that is repeated
and usually counted

3. The Situation
Perception is also affected by the surrounding environment.
The situational factors that affect perception are: time, work, setting, and
social setting.
As people’s moods vary from time to time, perception also varies
depending on the time the perception is made. Workplaces differ from one
another. As such, perception also differs from workplace to workplace.

What is ATTRIBUTION
Attribution theory is the process by which people ascribe causes to the
behavior they perceive.

Common Attribution Errors

When people make attempt to determine the causes of other people’s
behavior, errors commonly happen. These errors may be classified into the
following types:
 The fundamental attribution errors- refer to the tendency to underestimate the
influence of internal or personal factors in the behavior of others.
 The self-serving bias- type of attribution error whereby people tend to
attribute their achievements to their good inner qualities, whereas they
attribute their failures to adverse factors within the environment.

Factors that influence Attribution

When people try to determine the cause of a person’s behavior, whether the
cause is internal or external, some factors influence such effort. The factors refer
to the following:
Distinctiveness- the consideration given to how consistent a person’s behavior is
across different situations
Consensus- refers to the likelihood that all those facing the same situation will
have similar responses.
Consistency- refers to the measure of whether an individual responds the same
way across time.
SHORTCUTS USED IN FORMING IMPRESSIONS OF OTHERS
1. Selective Perception- happens when a person selectively interprets what he
sees on the basis of his interests, background, experience, and attitude.
- IT IS WRONG TO JUDGE PEOPLE WITH INSUFFICIENT
INFORMATION.
2. Halo Effect- occurs when one attribute of a person or situation is used to
develop an overall impression of the person or situation.
- “Halo” refers to the ring of light just above the head of a saint as we
see it in the pictures or paintings. The “halo” signifies that everything about the
saint is holy.
3. Contrast Effects- contrast effects may be defined as evaluations of a person’s
characteristic that are affected by comparisons with other people recently
encountered who rank higher or lower on the same characteristics.
- contrasting situations, oftentimes, lead to inaccurate evaluation of a
person’s character and ability.
4. Projection- it is attributing one’s own thoughts, feelings, or motives to
another. It is likely to occur in the interpretation stage of perception.
5. Stereotyping- refers to judging someone on the basis of one’s perception of the
group to which that person belongs.
CHAPTER 4:VALUES, ATTITUDES, and JOB SATISFACTION

Job Satisfaction
 An important concern for both employer and employee.
 This is so because of the benefits it brings to both.
 It is possible if the employees possess the right value and attitudes.

Values
 Values are guidelines and beliefs that a person uses when confronted with a
situation in which choice must be made.
 Values are “learned”

How people learn Values

MODELING
 Parents, teachers, friends, and other people oftentimes become models to
persons who would later exhibit good behavior in the workplace.
COMMUNICATION OF ATTITUDES
 When a person often hears from acquaintances the risk of buying products
imported from a certain country, that person may develop negative values
about the country.
RELIGION
 Values are also learned through religion.
 Just and fair treatment of people is a value that is taught by priest and minister
of various religious sects.
UNSTATED BUT IMPLIED ATTITUDES
 Values may also be affected by attitudes that are not stated but implied by
way of actions.

TYPES OF VALUES
Values may be classified in various ways. A classification that is most
relevant to the workplace indicates that values are of the following types:
1. Achievement - Value that pertains to getting things done and working hard to
accomplish goals.
2. Helping and concern for others - This value refers to the person's concern
with other people and providing assistance to those who need help.
3. Honesty - This is a value that indicates the person’s concern for telling the
truth and doing what he thinks is right.
4. Fairness - This is a value that indicates the person’s concern for impartiality
and fairness for all concerned.
 INDIVIDUAL versus ORGANIZATIONAL VALUES

Figure 11
Effects Of Value Congruence And Incongruence

ESPOUSED VS ENACTED VALUES

● Espoused Values- are what members of the organization say they value.
● Enacted Values- the actual behavior of the individual members of the
organization.

INSTRUMENTAL AND TERMINAL VALUES

● Terminal Values- may represents the goals that a person would like to achieve
in his or her lifetime.
● Instrumental Values- refer to preferable modes of behavior or means of
achieving the terminal values.
ATTITUDES
● They are link with perception, learning, emotions, and motivation.
● Attitudes also form a basis for job satisfaction in the workplace.
● Attitudes are feelings and beliefs that largely determine how employees will
perceive their environment, commit themselves to intended actions, and
ultimately behave.

Main Components of Attitudes

1. Cognitive- refers to the opinion or belief segment
2. Affective- refers to the emotional or feeling segment
3. Behavioral- refers to the intention to behave in a certain way toward
something or someone.

Differences in Personal Disposition

 People differ in their personal disposition. Some have attitudes that are
positively affective, while some have negatively affective attitudes.
 Positive affectivity refers to personal characteristics of employees that inclines
them to be predisposed to be satisfied at work. People who have positive
affectivity are optimistic, upbeat, cheerful, and courteous.
 Negative affectivity is a personal characteristic of employees that inclines
them to be predisposed to be dissatisfied at work. People who have negative
affectivity are generally pessimistic, downbeat, irritable, and sometimes,
abrasive.
 Managers and supervisors will benefit from knowing the personal disposition
of their subordinates. Their decisions regarding training hiring, and promotion
could be made better.
How attitudes are formed
They are formed through LEARNING.
Two methods:
1. DIRECT EXPERIENCE- Information stored in the human minds, and they
are most accessible.
Ex. Unpleasant Experience
2. INDIRECT EXPERIENCE-these are result of social interactions with family,
peer group, religious organizations, and culture.

Most Important Attitudes In The Workplace

1. Job Satisfaction
2. Job Involvement
3. Organizational Commitment

When employees are dissatisfied with their jobs, they will have a strong
tendency to engage in any or all of the following:
1. psychological withdrawal like daydreaming on the job;
2. physical withdrawal like unauthorized absences, early departures, extended
breaks, or work slowdowns; and
3. aggression, like verbal abuse or dangerous actions against another employee.

Making Positive Attitudes Work for the Organization

 People with positive work attitudes make it easy for the organization to
achieve its objectives. As such, recruitment officers must require positive
work attitudes before employment offers are made. Those who are already
employed by the organization but whose attitudes are negative must be made
 to participate or become beneficiaries of programs designed to change
negative work attitudes of employees to positive work attitudes.
 In the process of recruiting people to fill the various job vacancies in the
organization, proven methods of selection must be made. Applicants found to
have positive work attitudes should be considered for hiring if other job
requirements are met.
 There are various ways of changing employee attitudes. One is making the
reward system closely tied to individual or team performance.

JOB SATISFACTION
- the attitude people have about their jobs.
- refers to the positive feeling about one’s job resulting from an evalua of its
characteristics.

JOB DISSATISFACTION
- the feeling about one’s job is not positive.

When people are satisfied with their jobs, the following benefits become
possible:
1. high productivity
2. a stronger tendency to achieve customer loyalty
3. loyalty to the company
4. low absenteeism and turnover
5. less job stress and burnout
6. better safety performance
7. better life satisfaction

FACTORS ASSOCIATED WITH JOB SATISFACTION

a. Salary - adequacy of salary and perceived equity compared with others.
b. Work Itself - the extent to which job tasks are considered interesting and
provide opportunities for learning and accepting responsibility.
c. Promotion Opportunity - chances for further advancement.
d. Quality Of Supervision - the technical competence and the interpersonal
skills of one’s immediate superior.
e. Relationship With Co-Workers - the extent to which co-workers are
friendly, competent, and supportive.
f. Working Conditions - the extent to which the physical work environment
is comfortable and supportive of productivity.
g. Job Security - the beliefs that one’s position is relatively secure and
continued employment with the organization is a reasonable expectation.
WAYS OF MESSURING JOB SATISFACTION
SINGLE GLOBAL RATING METHOD
 refers to that approach where individuals are asked to respond to a single
question, such as, “How satisfied are you with your job?”
SUMMATION SCORE METHOD
 is an approach where individuals indicate their feelings regarding each key
factors of their job.

JOB INVOLVEMENT
-another positive employee attitude.
-it refers to the degree to which a person identifies with the job, actively
participates in it, and considers performance important to self-worth.

ORGANIZATIONAL COMMITMENT
-is the third positive employee attitude.
-it refers to the degree to which an employee identifies with a particular
organization and its goals and wishes to maintain membership in the
organization.

3 DIMENSIONS OF ORGANIZATIONAL COMMITMENT:

1. Affective Commitment - refers to the employee’s emotional attachment to the
organization and belief in its values.
2. Continuance Commitment - refers to the employee’s tendency to remain in an
organization because he cannot afford to leave.
3. Normative Commitment - refers to an obligation to remain with the company
for moral or ethical reason.
CHAPTER 5: NATURE OF BUSINESS

The Nature of Business

A business is an organization or enterprising entity engaging in
commercial, industrial, or professional activity. The nature of business can be
for-profit, non-profit or others.

What is nature of business?

The term nature of business pertains to different things to different people.
The nature of business describes what the company offers to its clients and the
industry. It also describes the legal structure or any other distinguishing
characteristics of the business.

For example, if one says that the nature of business is private, it usually
implies the company’s money-making nature. Similarly, when one says the
nature of business is manufacturing, the company focuses on manufacturing
operations. Additionally, when the nature of business is a corporation, it means
that the company has a big reach

Entrepreneurs, investors and lenders analyze the nature of financial

statements. They do this to determine whether a firm is feasible before investing
in it. This lets them choose whether or not it will be a worthwhile investment.

This also involves finance, nature of business meaning statements may be

required. The said statement should thoroughly address
the following elements of the business:
• Regular Process
 This separates businesses from hobbies. Businesses have procedures
that repeat themselves to get the same outcome. As a result people
receive a product or service. The owner then earns money.
• Economic Activity
 The primary purpose of any firm is to make money. And for a product
or service to be helpful to customers it must be given at the proper time
and place, solve a problem or meet a demand.
• Capital Requirement
 People need money to make money. These are required for the
production of a product or the provision of a service that generates
revenue.
• Goods and Services
  Every company provides something to the people. Some businesses
manufacture tangible things like clothing or automobiles. Others offer
intangible services like computer repair
• Anticipated Risk
 All require some level of time and financial effort. A business owner
will gain money on occasion and lose money sometimes. When it
comes to business, there’s always the possibility of losing money.
• Profit-Earning Motive
 Profit is the primary motivation for beginning a business. When
customers express a want or need businesses respond by providing a
product or service to match that need.

Involvement From the Buyer and Seller

In every transaction, the customer buys a product or service from the seller,
which is a crucial aspect of any business. Besides selling, businesses also have
social obligations towards their surrounding areas. They hire people, form
partnerships with other businesses, and provide necessary products and services
to the community. This social responsibility can extend to charitable endeavors
and enrichment programs.

The types of business entities include the ;

1. PUBLIC SECTOR which consists of government and government-
controlled businesses such as the Department of Health and the British
Broadcasting Corporation.
2. PRIVATE SECTOR businesses that operate independently or collectively
include HICAPS and Gardenia Wheat Bread.
3. INTERNATIONAL SECTOR businesses include exports from foreign
countries like McDonald's and Coca Cola.
4. TECHNOLOGICAL SECTOR companies focus on creating and
distributing technological products, with Apple Inc. And Microsoft
Corporation being examples.
5. SOLE PROPRIETORSHIP are businesses run by an individual without
legal distinction between themselves and the company entity; local restaurants
and grocery stores are examples.
6. PARTNERSHIP businesses are operated by two or more persons under
formal agreement; Microsoft and Apple started as collaborations

CORPORATION
A corporation is a legal entity created to conduct business activities. It is
owned by shareholders, who invest capital in exchange for ownership through
shares. Corporations provide limited liability to shareholders, meaning their
personal assets are generally protected from the company's debts. This structure
allows for easier capital raising, perpetual existence, and centralized
management. Corporations are governed by a board of directors, who make
strategic decisions, and executives, who handle day-to-day operations. They play
a crucial role in the global economy, contributing to various industries and
sectors.

Ex. Of Corporation
 Apple Inc.: A technology company known for its consumer electronics,
software, and services.
 ExxonMobil Corporation: A multinational energy corporation involved
in the exploration, production, refining, and marketing of oil and gas.
 The Coca-Cola Company: A global beverage corporation, renowned
for its soft drinks and other non-alcoholic beverages.
 Amazon.com, Inc.: A multinational technology and e-commerce
company, specializing in online retail, cloud computing, and artificial
intelligence.
 Toyota Motor Corporation: A leading automotive manufacturer
producing cars, trucks, and hybrid vehicles..

Limited Liability Company

 An LLC involves a business structure. Here, proprietors are not personally
accountable for the company's debts or liabilities.
Limited Liability Partnership
 An LLP means that all partners have limited responsibility to the company.
Brake Bros Ltd and Virgin Atlantic are two examples.
For-Profit Organizations
 Businesses in this category make a profit. These companies operate privately.
Non-profit Organizations
 Such organizations use the funds they get to further their social cause.

Example of Nature of Business 1: Service Business

Think about how many times you have paid someone to do something
for you.
Perhaps you paid someone to paint your house, replace your car's oil,
or make your dinner at a restaurant. You most likely paid someone to
perform these things because you lacked the time or ability to do them
yourself.

Example of Nature of Business 2 : Merchandising Business

 A merchandising business is a type of business that buys products
from manufacturers or wholesalers and sells them directly to consumers.
This business model involves the buying and reselling of tangible goods,
often with a focus on retail sales. The merchandising process includes
activities such as selecting products, pricing, promoting, and displaying
them to attract customers. The goal is to generate revenue by selling
products at a profit while efficiently managing inventory and meeting
customer demands.

Examples of Nature of Business 3: Manufacturing business

A manufacturing business makes physical products by turning raw
materials into finished goods. Its importance lies in creating a variety of
products, generating jobs, and driving economic growth by meeting
consumer demands.

Example of Nature of Businesses 4: Hybrid Business

Hybrid businesses are companies that may be classified in more than
one type of business. A restaurant, for example, combines ingredients in
making a fine meal (manufacturing), sells a cold bottle of wine
(merchandising), and fills customer orders (service).
Nonetheless, these companies may be classified according to their major
business interest. In that case, restaurants are more of the service type –
they provide dining services.

What are the 4 nature of businesses

1. Natural resources
2. labor (Human resources)
3. Capital
4. Entreperneurship
This are the four classical components of productrion shared by all
economic activity.

How do you determine the Nature of Business?

The following aspect determine the nature of business:
1. Regular process- The profit- generating processes are regularly repeated.
2. Economic activity- The activities that maximize
profit.
3. Utility creation- a kind of utility the goods or services create for customers
or making a products or services more valuable and desirable to
customers.
4. Capital requirement- The amount of funding required for the business
 5. Goods or services- The types of goods (tangible or intangible) offered by
the business
6. Risk- It involves the possibility of facing negative outcomes or losses due
to uncertain factors like market changes, competition or operational
challenges.
7. Satisfaction of consumer’s needs- means fulfilling the desire and needs of
customers, resulting in their contentment with the product or services.
8. Buyer and seller – Buyer seek to acquire products or services to satisfy
their needs or desire, while seller offer those product or services to meet
those demands and generate revenue.
9. Social obligations- refers to the responsibilities or duties that individuals
or organization have towards society, including actions or contributions
aimed at benefiting the community or addressing societal issues.

Conclusion
The nature of business specifies what it is and what it does.

Nature of businesses may be determined according to the way they operate

and their goals. It can also be determine by their organizational structure, profit
orientation, and what they provide.