OB and its Nature

Organizational behavior-Definition &
Nature
Organizational behavior- it is made out of
two words “organization” and “behavior.”
What is an organization?
Organization as two or more individuals who
are interacting with each other within a
deliberately structured set up and working in
an interdependent way to achieve some
common objective/s. Organizations play a
major role in pur lives. We possibly cannot
think of a single moment in our lives when we
are not depending on rganizations in some
form or the other. Right from the public
transport that you use to come to your
institute, the institutes itself, the class you are
attending at this moment, are all examples of
organizations.
What is Behavior?
It is the behavior of the people working in an
organization to achieve common goals or
objectives. Organization comprises of people
with different attitudes, cultures, beliefs,
norms and values.
So let us understand organizational behavior
and what it exactly it means. “Organizational
Behavior” cam be defined as the study of what
people think, feel, and do in and around
organizations. The study of Organizational
Behavior facilitates the process of explaining,
understanding) predicting, maintaining, and
changing employee behavior in an
organizational setting. The value of
organizational behavior is that: it isolates
important aspects of the
manager’s job and offers specific perspective
on the human side of management:
• People as organizations,
• People as resources,
• People as people
In other words, it involves the understanding,
prediction and control of human behavior and
factors affecting their performance and
interaction among the organizational members.
And because organizational behavior is
concerned specifically with employment –
related situations, you should not be surprised
to find that it emphasizes behavior as related-
to concerns such as jobs, work, absenteeism,
employment turnover, productivity, human
performance and management
Nature of Organizational Behavior (OB)
Organizational behavior is an applied
behavioral science that is built on
contributions from a number of behavioral
disciplines such as psychology, sociology,
social psychology, anthropology and
economics.
Psychology
Psychology is the study of human behavior
which tries to identify the characteristics of
individuals and provides an understanding why
an individual behaves in a particular way. This
thus provides us with useful insight into areas
such as human motivation, perceptual
processes or personality characteristics.
Sociology
Sociology is the study of social behavior,
relationships among social groups and
societies, and the maintenance of social order.
The main focus of attention is on the social
system.
This helps us to appreciate the functioning of
individuals within the organization which is
essentially a socio-technical entity.
Social psychology
Social psychology is the study of human
behavior in the context of social situations.
This essentially addresses the problem of
understanding the typical behavioral patterns
to be expected from an individual when he
takes part in a group.
Anthropology
Anthropology is the science of mankind and
the study of human behavior as a whole. The
main focus of attention is on the cultural
system, beliefs, customs, ideas and values
within a group or society and the comparison
of behavior among different cultures. In the
context of today’s organizational scenario. It is
very important to appreciate the differences
that exist among people coming from different
cultural backgrounds as people are often found
to work with others from the other side of the
globe.
Economics
Any organization to survive and sustain must
be aware of the economic viability of their
effort. This applies even to the non-profit and
voluntary organizations as well.
Political Science
Although frequently overlooked, the
contributions of political scientists are
significant to the understand arrangement in
organizations. It studies individuals and groups
within specific conditions concerning the
power dynamics. Important topics under here
include structuring of conflict, allocation of
power and how people manipulate power for
individual self-interest etc.

Introduction to ORGANISATIONAL BEHAVIOR (OB)

Organisational Behavior

OB is the study and application of knowledge about the human behavior in order to obtain organisational effectiveness.

As we know that many people come together at the workplace. They come from diverse backgrounds, diverse religions, diverse regions. Different people have different values, beliefs, tastes and ideas. All these factors make up a structure that shapes the behavior of the people. OB strives to understand this structure. OB strives to understand these factors. OB strives to know what makes up a particular behavior in an individual level and how beneficial or detrimental is that behavior to the organisation. OB studies about the behavior of individuals in order to change them favourably. Hence, OB is the study of the various factors that make up the behaviour of individuals and then the application of the knowledge obtained in order to mould their behavior in such a way so as to make it beneficial to the organisational effectiveness.

OB also studies how people behave differently at their individual level and at the workplace or organisational level. OB understands all causes.

OB is a subject that consists of studies varying from Anthropology, Psychology, Industrial Relations, History, Sociology, etc. The roots of OB lie as back as the advent of Scientific Management and Human Relations Movement of 1940. Today, OB is studied at colleges and universities as a full-fledged subject and is practically applied at organisations.

Characteristics of a Contract of Guarantee

Characteristics or essentials of contract of
guarantee
Following are the characteristics or essentials
of contract of guarantee:
i. Tripartite agreement: In a contract of
guarantee, there are three parties namely:
principal creditor, creditor and surety. Under
this contract, three separate contracts are
made among them and consent of all the three
parties is necessary. The contracts connecting
each-other as contract between:
a. the principal debtor and creditor,
b. the creditor and surety, and
c. the surety and principal debtor,
ii. Liability: Under such contract the primary
liability is of the principal debtor and only
secondary liability is of the surety. As a
conditional contract, liability of the surety
arises only when the principal debtor
(primarily liable) defaults.
iii. Essentials of valid contract: It is also as
same as other general contract in respect of
essentials. All the requirements for valid
contract, i.e. free consent, consideration,
lawful object, competency of the parties etc.
are necessary to form this kind of contract.
But, in respect of consideration, no direct
consideration in the contract between the
surety and creditor. Consideration of principal
debtor is considered to be adequate for the
surety.
iv. Written form: A contract relating to
guarantee must be concluded in writing in
Nepal and England. But, the Indian legal
framework does not compel to form such
contract in written form. Both written and oral
is valid in India.

Parties to Contract of Guarantee

A Contract to perform the promise, or
discharge the liability, of a third person in
case of his default is called Contract of
Guarantee . A guarantee may be either oral
or written.
The person who gives the guarantee is called
the Surety
The person on whose default the guarantee
is given is called the Principal Debtor
The person to whom the guarantee is given
is called the Creditor

Contract of Guarantee, Meaning and Definition

A Contract of guarantee is a contract to
perform the promise, or discharge the liability,
of a third person in case of his default. The
person who gives the guarantee is called the
surety; the person in respect of whose default
the guarantee is given is called the principal
debtor, and the person to whom the guarantee
is given is called the creditor. A guarantee may
be either oral or written. [section 126]. - -
[Person giving guarantee is also called as
guarantor. However, Contract Act uses the
word surety which is same as guarantor]. - -
Three parties are involved in contract of
guarantee. Contract between any two of them
is not a contract of guarantee. It may be
contract of indemnity. Primary liability is of
the principal debtor. Liability of surety is
secondary and arises when Principal Debtor
fails to fulfill his commitments.

Channel Management

Product distribution (or place) is one of the
four elements of the marketing mix .
Distribution is the process of making a product
or service available for use or consumption by
a consumer or business user, using direct
means, or using indirect means with
intermediaries.
The other three parts of the marketing mix are
product , pricing and promotion.
Channels and intermediaries
Distribution of products takes place by means
of channels. Channels are sets of
interdependent organizations (called
intermediaries) involved in making the product
available for consumption.[1] Merchants are
intermediaries that buy and resell products.
Agents and brokers are intermediaries that act
on behalf of the producer but do not take title
to the products.
↑Jump back a section
Channel design
A firm can design any number of channels.
Channels are classified by the number of
intermediaries between producer and
consumer. [1] A level zero channel has no
intermediaries. This is typical of direct
marketing . A level one channel has a single
intermediary. This flow is typically from
manufacturer to retailer to consumer.
Types
Category
Definition
Intensive distribution
the producer's products are stocked in the
majority of outlets. [1] This strategy is
common for basic supplies, snack foods,
magazines and soft drink beverages.
Selective distribution
means that the producer relies on a few
intermediaries to carry their product. [1] This
strategy is commonly observed for more
specialised goods that are carried through
specialist dealers, for example, brands of
craft tools, or large appliances.
Exclusive distribution
means that the producer selects only very few
intermediaries. [1] Exclusive distribution is
often characterised by exclusive dealing where
the reseller carries only that producer's
products to the exclusion of all others. This
strategy is typical of luxury goods retailers
such as Gucci.
↑Jump back a section
Channel mix
In practice, many organizations use a mix of
different channels; in particular, they may
complement a direct sales-force, calling on the
larger accounts, with agents, covering the
smaller customers and prospects. In addition,
online retailing or e-commerce is leading to
disintermediation. Retailing via smartphone or
m-commerce is also a growing area.
↑Jump back a section
Managing channels
The firm's marketing department needs to
design the most suitable channels for the
firm's products, then select appropriate
channel members or intermediaries. The firm
needs to train staff of intermediaries and
motivate the intermediary to sell the firm's
products. The firm should monitor the
channel's performance over time and modify
the channel to enhance performance.
Channel motivation
To motivate intermediaries the firm can use
positive actions, such as offering higher
margins to the intermediary, special deals,
premiums and allowances for advertising or
display.[1] On the other hand, negative actions
may be necessary, such as threatening to cut
back on margin, or hold back delivery of
product.
Channel conflict
Channel conflict can arise when one
intermediary's actions prevent another
intermediary from achieving their objectives.
[1] Vertical channel conflict occurs between
the levels within a channel and horizontal
channel conflict occurs between intermediaries
at the same level within a channel.

Functions of Channel Members

Functions of channel Members

There are numerous functions performed by
channel members. All of these function utilize
scarce resources of the organization.
Furthermore, these functions can be better
performed through specialization in the
function or through expertise of the function.
And on top of it each function can be
transferred within the various channel
members.
Main functions of channel members in channel
distribution are
1. Risk taking – Assuming the risk connected
with carrying out channel work or being
a part of a channel
2. Financing – Acquiring funds to finance
for inventories
3. Physical distribution of goods – Storage
and movement of physical goods
4. Negotiations – Reaching an agreement on
pricing and other terms which may be a
part of the transaction
5. Matching – Placing order with the
manufacturers and matching the orders
to the actual requirement.
6. Contacts – Maintaining contacts with
existing customers as well establishing
contacts with potential customers and
maintaining the same with the regulatory
bodies
7. Promotions – Carrying out effective
communications to stimulate purchasing
8. Information – Gathering information
about potential customers, competition
as well as tracking the environmental
factors
As we can see, the more specialized a channel
member is, the better he will perform in any
of the above given functions. Also the
functions are such that they can be shifted
within various channel members.