Organizational behaviour theories


The purpose of this essay is to discuss the statement “organizational behaviour theories and concepts are only useful for managers” with real world examples supporting the discussion.

Organizations are not buildings or pieces of machinery. Organizations are, indeed, people who interact to accomplish shared objectives. The study of organizational behaviour (OB) and its affiliated subjects helps us understand what people think, feel and do in organizational settings. For managers and, realistically, all employees, this knowledge helps predict, understand and control organizational events.

Organizational behaviour is a field of study that investigates the impact that individuals, groups and structure have on behaviour within organizations for the purpose of applying such knowledge towards improving an organisation’s effectiveness (Robbins, Millett, & Marsh, 2004).

Though there is still considerable debate as to the components or topics of the area of OB, there appears to be general accord that OB includes the core topics of motivation, leader behaviour and power, interpersonal communication, group structure and process, learning, attitude development and perception, emotions, change processes, conflicts, work design & work stress. To sum up OB is concerned with the study of what people do in an organization and how that behaviour affects the performance of the organization.

To achieve the purpose the essence of this essay strives to analyze the controversial and complex theories and concepts of organisational behaviour & to discuss those theories and concepts useful for everyone or only managers of an organisation.

2.0 Role of the Manager

2.1. Who is a Manager?

A manager is someone who works with and through other people by coordinating their work activities in order to accomplish organizational goals. The changing nature of organizations and work has altered the role of managers.

2.2. What do Managers Do

Describing what managers do isn’t an easy or simple task! Just as no two organizations are alike, no two managers’ jobs are alike. A manager’s job can be described from various perspectives: functions, roles, essential skills, systems, and contingencies. Each approach provides a different perspective on the manager’s job.

Management is the process of coordinating work activities so they’re completed efficiently and effectively with and through other people. Efficiency refers to getting the most output from the least amount of inputs. Effectiveness is concerned with completing activities so that organizational goals are attained. Efficiency is concerned with the means of getting things done and effectiveness is concerned with the ends.

The process of management refers to the idea that management consists of a set of ongoing decisions and actions in which managers engage as they plan, organize, lead, and control. Planning involves defining an organization’s goals and establishing strategies and plans to achieve those goals. Organizing includes designing a structure to carry out the plans. Leading involves motivating subordinates, influencing individuals or teams, communicating effectively, and dealing with employee behaviour issues. Finally, controlling includes monitoring, comparing, and correcting the organization’s performance.

Henry Mintzberg concluded that managers perform 10 different roles or behaviours. He classified them into three sets. One set is concerned with interpersonal relationships (figurehead, leader, liaison). The second set is related to the transfer of information (monitor, disseminator, spokesperson). The third set deals with decision making (entre-preneur, disturbance handler, resource allocator, negotiator).

Robert Katz identified three skills managers need: technical, human, and conceptual. He showed that the relative importance of these skills varied according to the management level within the organization.

The systems perspective can be used to describe what a manager does because organizations are open systems with interrelated and interdependent parts. Within this “system,” managers coordinate the various work activities so that the organization can meet its goals.

The reality of work is that manager will either manage or be managed, and there are rewards and challenges in being a manager.

3.0 Organisational behaviour theories and concepts

There are several crucial reasons why companies should utilize the concepts and theories of OB, as well as understand the key terms that are associated with organizational behaviour. One of the most important and broad-based challenges facing organizations today is adapting to diverse work environments. Organizations are becoming more heterogeneous in terms of gender, race, and ethnicity. For example, several key terms that must also be understood organizational culture, diversity, communication, organizational effectiveness and efficiency, organizational learning.

3.1. Attitudes

Attitudes are evaluative statements either favourable or unfavourable concerning objects, people, or events. They reflect how an individual feels about something. When a person says, “I like my job,” he or she is expressing an attitude about work.

The Theory of Cognitive Dissonance:Cognitive dissonance theory sought to explain the relationship between attitudes and behaviour. Cognitive dissonance is any incompatibility or inconsistency between attitudes or between behaviour and attitudes. The theory argued that any form of inconsistency is uncomfortable and that individuals will try to reduce the dissonance and, thus, the discomfort. In other words, individuals seek stability with a minimum of dissonance.

Self-Perception Theory: People decide on their own attitudes and feelings from watching themselves behave in various situations. (Straker, c Syque 2002-2009)

Usefulness of Attitudes Theories & Concepts for Managers and Employees.

Effective managers need to understand behaviours and attitudes of employees. Therefore knowing above theories Managers can pressure to reduce the dissonance when employees recognize that the dissonance is externally imposed and uncontrollable. The pressure is also decreased if rewards are significant enough to offset the dissonance. So the manager may point to external forces such as competitors, customers, or other factors when explaining the need to perform some work activity about which workers may have some dissonance. Or the manager can provide rewards that workers desire in order to decrease their attempts to get rid of the dissonance.

Another implication for managers is that there is relatively strong proof that committed and satisfied employees have low rates of turnover and absenteeism. Knowing that managers would like to keep resignations and absences down, mostly among their most productive employees. Managers can do those things by generating positive job attitudes. Measuring employee satisfaction through attitude surveys can alert managers to any significant changes. The manager who knows about the above theories can reduce absenteeism and turnover by using those theories and concepts.

Employees who know attitude theories and concepts try to reduce dissonance and decide on their attitudes and feelings which lead them to the successful job performance. Then furthermore successful job performance should lead to feelings of accomplishment, increased pay, promotions, and other rewards, all desirable outcomes that then lead to job satisfaction of employees.

3.2. Personality

The sum total of ways in which an individual reacts and interacts with others, measurable traits a person exhibits. There are dozens of personality traits could use; for instance, aggressive, shy, ambitious, loyal, and lazy.

The Big Five Model of Personality Dimensions: The big-five personality traits are;

  • Extraversion: The degree to which someone is sociable, talkative, and assertive.
  • Agreeableness: The degree to which someone is good-natured, cooperative, and trusting.
  • Conscientiousness: The degree to which someone is responsible, dependable, persistent, and achievement oriented.
  • Emotional stability: The degree to which someone is calm, enthusiastic, and secure (positive) or tense, nervous, depressed, and insecure (negative).
  • Openness to experience: The degree to which someone is imaginative, artistically sensitive, and intellectual.

Personality-Job Fit Theory (Holland):

Identifies six personality types and proposes that the fit between personality type and occupational environment determines

satisfaction and turnover. The six basic personality types of work environments are; Realistic, Investigative, Artistic, Social, Enterprising, Conventional.

Usefulness of Personality Theories & Concepts for Managers and Employees.

For managers the major value in understanding personality differences probably lies in employee selection. Managers are likely to have higher performing and more satisfied employees if consideration is given to matching personalities with jobs. The best-documented personality job fit theory has been developed by psychologist John Holland. His theory states that an employee’s satisfaction with his or her job, as well as his or her likelihood of leaving that job, depends on the degree to which the individual’s personality matches the occupational environment. Furthermore it illustrates satisfaction is highest and turnover lowest when personality and occupation are compatible. Therefore it’s valuable for managers to know about personality theories and concepts.

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Also being a successful manager and accomplishing goals means working well together with others both inside and outside the organization. In order to work effectively together, managers need to understand each other. This understanding comes, at least in part, from recognizing the ways in which people differ from each other that is, from an appreciation of personality traits.

In addition, there are other benefits to a manager’s understanding of personality. By recognizing that people approach problem solving, decision making, and job interactions differently, a manager can better understand why, for instance, an employee is uncomfortable with making quick decisions or why another employee insists on gathering as much information as possible before addressing a problem. Or, for instance, managers can expect that individuals with an external locus of control may be less satisfied with their jobs than internals and also that they may be less willing to accept responsibility for their actions.

People who choose to work in an environment similar to their personality type are more likely to be successful and satisfied. For that reason knowing personality theories and concepts person can select a job that fit for him or her.

For example, Artistic persons are more likely to be successful and satisfied if they choose a job that has an Artistic environment, like choosing to be a dance teacher in a dancing school an environment “dominated” by Artistic type people where creative abilities and expression are highly valued.

Moreover knowing those theories help employees to work with their office mates/staff with an understanding.

3.3. Learning

Learning occurs all the time as we continuously learn from our experiences. It can define as any relatively permanent change in behaviour that occurs as a result of experience.

  • Classical conditioning: A type of conditioning in which an individual responds to some stimulus that would not ordinarily produce such a response.
  • Operant conditioning: Operant conditioning argues that behaviour is a function of its consequences. People learn to behave to get something they want or to avoid something they don’t want. Operant behaviour describes voluntary or learned behaviour in contrast to reflexive or unlearned behaviour. The tendency to repeat learned behaviour is influenced by the reinforcement or lack of reinforcement that happens as a result of the behaviour.
  • Social-learning theory: Individuals also can learn by observing what happens to other people and just by being told about something as well as by direct experiences. So, for example, much of what we have learned comes from watching others (models)—parents, teachers, peers, television and movie actors, managers, and so forth. This view that we can learn both through observation and direct experience is called social learning theory.
  • Shaping behaviour theory: Systematically reinforcing each successive step that moves an individual closer to the desired response.

Usefulness of Learning Theories & Concepts for Managers and Employees.

Employees are going to learn on the job. The only issue is whether managers are going to manage their learning through the rewards they allocate and the examples they set or allow it to occur unsystematically. If marginal employees are rewarded with pay raises and promotions, they will have little reason to change their behaviour. In fact, productive employees, seeing that marginal performance gets rewarded, might change their behaviour. According to it managers can use learning theories and concepts to motivate employees to do thing as wanted.

3.4. Perception & Decision Making

Perception is a process by which individuals give meaning to their environment by organizing and interpreting their sensory impressions.

Attribution Theory:

Attribution theory was developed to explain how we judge people differently depending on the meaning we attribute to a given behaviour. Basically, the theory suggests that when we observe an individual’s behaviour, we attempt to determine whether it was internally or externally caused. Internally caused behaviours are those that are believed to be under the personal control of the individual. Externally caused behaviour results from outside factors; that is, the person is forced into the behaviour by the situation. That determination, however, depends on three factors: distinctiveness, consensus, and consistency.

Decision making is an integral function of management. Decision making involves selecting or choosing a particular course of action from among the various alternatives available in the decision making situation.

Rational Decision-Making Model:

A decision-making model that describes how individuals should behave in order to maximise some outcome.

Step 1. Define the Problem

Step 2. Identify the Decision Criteria

Step 3. Weight the Criteria

Step 4. Generate Alternatives

Step 5. Rate Each Alternative on Each Criteria

Step 6. Compute Optimal Decision

Usefulness of Perception Theories & Concepts for Managers and Employees.

Managers need to recognize that their employees react to perceptions, not to reality. So whether a manager’s appraisal of an employee is actually objective and unbiased or whether the organization’s wage levels are among the highest in the community is less relevant than what employees perceive them to be. Employees organize and interpret what they see, so there is always the potential for perceptual distortion.

The message to managers should be clear: Pay close attention to how employees perceive both their jobs and management actions. Since the valuable employee who quits because of an inaccurate perception is just as great a loss to an organization as the valuable employee who quits for a valid reason.

In addition, job satisfaction also influences organizational behavior, primarily through perceptions of fairness. That means “If employees don’t feel that their supervisors or the organization’s procedures or pay policies are fair, their job satisfaction is likely to suffer significantly. However, when employees perceive organizational processes and outcomes to be fair, trust is developed. And when employees trust their employer, they’re more willing to voluntarily engage in behaviors that go beyond the formal job requirements”.

Usefulness of Decision Making Theories & Concepts for Managers and Employees.

Studies show that managers may spend up to 70 percent of their time in group meetings. Undoubtedly, a large portion of that time is spent formulating problems, developing solutions, and determining how to implement the solutions.Therefore it proved knowing decision making theories and concepts is useful for as individually managers. It helps to make decisions in order to gain maximum productivity.

3.5. Motivation

Motivation is the process that account for an individual’s intensity, direction and persistence of effort toward attaining a goal. In today’s world motivation is seen as being best achieved by a combination of elements within the organization that combine to produce it: needs; job design; satisfaction.

There are many theories of motivation that have emerged in organizational behaviour literature.

Early Theories of Motivation

Hierarchy of needs theory:

Maslow’s Hierarchy of Needs (often represented as a pyramid with five levels of needs) is a motivational theory in psychology that argues that while people aim to meet basic needs, they seek to meet successively higher needs in the form of a hierarchy.

Maslow’s Hierarchy of needs (Learning Theories Knowledgebase, 2009)

Individuals can’t move to the next higher level until all needs at the current level are satisfied. So they have to move up the hierarchy in order.

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Theory X & Y:

Very simply, Theory X presents an essentially negative view of people and Theory Y offers a positive view.

Two-factor theory:

motivation-hygiene theory proposes that intrinsic factors are related to job satisfaction and motivation, whereas extrinsic factors are associated with job dissatisfaction.

McClelland’s Theory of Needs:

McClelland proposed that an individual’s specific needs are acquired over time and are shaped by one’s early life experiences. Theory focuses onpeople havingthree fundamental needs that exist in different degrees, one being a stronger preference:-

  • The need for achievement
  • The need for affiliation
  • The need for power (authority)

A person’s motivation and effectiveness in certain job functions are influenced by these three needs because they have different level of needs in each of these areas. (Edwards, 2009.)

Goal setting Theory:

Conscious goals affect action. A goal is the object or aim of an action.

For example -: to attain a specific standard of proficiency, usually within a specified time limit. As industrial-organizational psychologists, our primary interest has been to predict, explain, and influence performance on organizational or work-related tasks. Thus, we focused on the relationship between conscious performance goals and level of task performance rather than on discrete intentions to take specific actions.

Reinforcement Theory:

In contrast to goal-setting theory, reinforcement theory says that behaviour is a function of its consequences. Goal-setting theory proposes that an individual’s purpose directs his or her behaviour. Reinforcement theory argues that behaviour is externally caused. What controls behaviour are reinforcers, consequences that, when given immediately following a behaviour, increase the probability that the behaviour will be repeated.

The key to reinforcement theory is that it ignores factors such as goals, expectations, and needs. Instead, it focuses solely on what happens to a person when he or she takes some action.

Expectancy Theory:

Expectancy theory states that an individual tends to act in a certain way based on the expectation that the act will be followed by a given outcome and on the attractiveness of that outcome to the individual. It includes three variables or relationships

Equity Theory:

This is a process theory that focuses on individual’s perceptions of how fairly they are treated relative to others.

The 4 most common ways to reduce a perceived inequity are to,

  • Change inputs.
  • Change outcomes.
  • Distort perceptions.
  • Leave the job.

Usefulness of Motivation Theories & Concepts for Managers and Employees.

Managers can recognize individual differences by using above theories as almost every contemporary motivation theory recognizes that employees aren’t identical. They have different needs, attitudes, personality, and other important individual variables.

Also managers can match people to jobs. There’s a great deal of evidence showing the motivational benefits of carefully matching people to jobs. For example, high achievers should have jobs that allow them to participate in setting moderately challenging goals and that involve autonomy and feedback. Also keep in mind that not everybody is motivated by jobs that are high in autonomy, variety, and responsibility.

Employees have different needs, what acts as a reinforcer for one may not for another. Managers should use their knowledge about theories and concepts of motivation to motivate employee using different reward systems.

Ex-: Individualize the rewards they control, such as pay, promotions, recognition, desirable work assignments, autonomy, and participation.

Link rewards to performance.

Allocation of performance-based wage increases

Piecework bonuses

Pay incentives

is important in determining employee motivation.

So as mentioned above managers can induce employees to achieve organizational goals through knowledge of motivational theories and concepts

3.6. Leadership

The aspect of leadership is perhaps one of the most influential elements in organizational behavior. This is because the leaders are expected to direct the company in such a way as to maximize corporate objectives while minimizing costs. Leadership is a special case of interpersonal influence that gets an individual or group to do what the leader wants done (Wood, Wallance, Zeffane, Schermerhorn, Hunt, & Osborn, 2001).

Trait Theories:

Trait theories are more traditional and focus on the personal traits of leaders from those of followers. Six traits associated with effective leadership included;

  • ambition and energy
  • the desire to lead
  • honesty and integrity
  • self-confidence
  • intelligence
  • job relevant knowledge

Traits alone were not sufficient for explaining effective leadership. Explanations based solely on traits ignored the interactions of leaders and their group members as well as situational factors. Possessing the appropriate traits only made it more likely that an individual would be an effective leader.

Behavioural Theories: Behavioral therapists take a different approach. Behavioralists try to determine the types of leadership behaviors that have produced a higher level of work performance. There are four main leader behaviour studies we need to look at.

Managerial Grid

Concern for people:

measured leader’s concern for subordinates on a scale of 1 to 9 (low to high)

Concern for production:

measured leader’s concern for getting job done on a scale of 1 to 9 (low to high)

Contingency Theory:

In this section we examine five contingency theories. Each looks at defining leadership style and the situation and attempts to answer the if-then contingencies (i.e., if this is my situation, then this is the best leadership style for me to use)

The Fiedler Model – the Fiedler contingency model proposed that effective group performance depended on the proper match between the leader’s style of interacting with his or her followers and the degree to which the situation allowed the leader to control and influence. The model was based on the premise that a certain leadership style would be most effective in different types of situations. The key was to define those leadership styles and the different types of situations and then to identify the appropriate combinations of style and situation.

Fiedler proposed that a key factor in leadership success was an individual’s basic leadership style. He further suggested that a person’s style was one of two types: task oriented or relationship oriented. To measure a leader’s style, Fiedler developed the least-preferred co-worker (LPC) questionnaire. This questionnaire contained 16 pairs of contrasting adjectives.

After an individual’s basic leadership style had been assessed through the LPC, it was necessary to evaluate the situation in order to match the leader with the situation. Fiedler’s research uncovered three contingency dimensions that defined the key situational factors for determining leader effectiveness. These were:

  • Leader-member relations: the degree of confidence, trust, and respect employees had for their leader; rated as either good or poor
  • Task structure: the degree to which job assignments were formalized and procedurized; rated as either high or low
  • Position power: the degree of influence a leader had over power-based activities such as hiring, firing, discipline, promotions, and salary increases; rated as either strong or weak

Each leadership situation was evaluated in terms of these three contingency variables.

Hersey and Blanchard’s Situational Leadership Theory – focuses on followers’ readiness. SLT says if followers are;

  • Telling (high task-low relationship): The leader defines roles and tells people what, how, when, and where to do various tasks.
  • Selling (high task-high relationship): The leader provides both directive and supportive behavior.
  • Participating (low task-high relationship): The leader and follower share in decision making; the main role of the leader is facilitating and communicating.
  • Delegating (low task-low relationship): The leader provides little direction or support.

Leader Participation Model – related leadership behaviour and participation in decision making. The model argued that leader behaviour must adjust to reflect the task structure whether it was routine, nonroutine, or anywhere in between. Leadership Styles in the Vroom Leader Participation Model are;

  • Decide: Leader makes the decision alone and either announces or sells it to group.
  • Consult Individually: Leader presents the problem to group members individually, gets their suggestions, and then makes the decision.
  • Consult Group: Leader presents the probelm to group members in a meeting, gets their suggestions, and then makes the decision.
  • Facilitate: Leader presents the problem to the group in a meeting and, acting as facilitator, defines the problem and the boundaries within which a decision must be made.
  • Delegate: Leader permits the group to make the decision within prescribed limits.

Path-Goal Model –

which states that it’s the leader’s job to assist his or her followers in attaining their goals and to provide the direction or support needed to ensure that their goals are compatible with the overall objectives of the group or organization.

House identified four leadership behaviors:

  • Directive leader: lets subordinates know what’s expected of them, schedules work to be done, and gives specific guidance on how to accomplish tasks
  • Supportive leader: is friendly and shows concern for the needs of followers
  • Participative leader: consults with group members and uses their suggestions before making a decision
  • Achievement-oriented leader: sets challenging goals and expects followers to perform at their highest level

Path – goal theory

Leader-Member Exchange Theory – indicates that leaders develop special relationships with trusted followers.

Usefulness of Leadership Theories & Concepts for Managers and Employees.

Leadership may not always be important but the aspect of leadership is conceivably one of the most influential elements in organizational behavior. This is because the leaders are expected to direct the company in such a way as to maximize corporate objectives while minimizing costs. In perhaps more than any other area of organizational behavior the leadership aspect is a combination of learning theories, power, personality, performance appraisal and motivation. This is because leadership is the process whereby an individual must gain the voluntary participation of subordinates with the goal of attaining corporate objectives. Thus, a leader’s personality and sense of power will influence this process. Further, motivation is a key aspect of leadership because goal will not be attained if subordinates are not properly motivated to achieve them and performance appraisal is a key element in this process. Without adequate feedback that is quantifiable, leaders will not be able to assess employee performance reliably or measure progress in attaining corporate objectives. So it’s important to have knowledge of leadership concepts and theories to both employees and managers to achieve organizational goals.

3.7. Groups

A group is defined as two or more interacting and interdependent individuals who come together to achieve particular goals. Groups can either be formal or informal. Formal groups are work groups established by the organization that have designated work assignments and specific tasks. In formal groups, appropriate behaviours are established by and directed toward organizational goals.

Five stage Group Development Model –

  • Forming stage: The first stage in group development characterised by much uncertainty.
  • Storming stage: The second stage in group development characterised by intra-group conflict.
  • Norming stage: The third stage in group development, characterised by close relationships and cohesiveness.
  • Performing stage: The fourth stage development, when the group is fully functional.
  • Adjourning stage: The final stage in group development for temporary groups characterised by concern with wrapping up activities rather than task performance.

Group Behaviour Model – Group behaviour emanates from the causes that contribute to the group’s effectiveness.

Usefulness of Group Theories & Concepts for Managers and Employees.

The group task is a whole and meaningful piece of work, with a visible outcome. According to the knowledge of group theories and concepts managers can form groups and give goals to achieve as a group. It can lead effective performance of employees due to the level of performance it is a large extent, dependent on the resources that its members individually bring to the group and trustworthiness.

Also it’s valuable as individuals both managers and employees know about the above theories and concepts because they have to work as a group.

3.8. Change Management

Change is often resisted because of the uncertainty and ambiguity it creates, the concern for personal loss, and the belief that it might not be in the organization’s best interest. If it weren’t for organizational change that is, any alterations in people, structure, or technology.

Lewin’s Three-Step Change Model- Lewin argued that successful change in organisation should follow below 3 steps.]

  • Unfreezing: getting ready for change (the status quo)

    – Minimizing resistance

  • Moving: making the change (to a new state)

    – Changing people (individuals and groups); Tasks; Structure; Technology

  • Refreezing: stabilizing the change (the new change to make permanent)

    – Reinforcing outcomes, evaluating results, making constructive modifications

Usefulness of Change Management Theories & Concepts for Managers and Employees.

The manager’s options for change essentially fall into three categories: structure, technology, and people.Change replace the known with ambiguity and uncertainty. For example, when quality control methods based on sophisticated statistical models are introduced into manufacturing plants, many quality control inspectors have to learn the new methods. Some inspectors may fear that they will be unable to do so and may, therefore, develop a negative attitude toward the change or behave poorly if required to use new methods.

The second cause of resistance is the fear of losing something already possessed. Change threatens the investment you’ve already made in the status quo. The more that people have invested in the current system, the more they resist change. They fear the loss of status, money, authority, friendships, personal convenience, or other benefits that they value. This helps explain why older workers tend to resist change more than younger workers. Older employees have generally invested more in the current system and, thus, have more to lose by changing.

A final cause of resistance is a person’s belief that the change is incompatible with the goals and interests of the organization.

Therefore as a manager should be familiar with Change management theories to make changes and survive in the changes happen. Also employees should aware about these things to survive in the changes of structure, technology and people in the organisation.


Organizational behaviour involves studying how employees act and perform in organizations. Understanding organizational behaviour can help employees and managers create a more enriching work environment. This understanding can also help employees develop a better understanding of how they relate to the work environment and expand their career potential.

We can found many organisational behavioural theories and concepts. In this essay have mentioned organisational behavioural theories and concepts such as Attitudes, Perception, Personality, Decision Making, Motivation, Leadership, Change Management and Groups. Also have discussed how these theories & concepts useful for the managers and the employees in an organisation.

In order to conclude it is important to state that this essay proved Organizational behavioural theories and Concepts are not only useful for managers but also others in an organization. Furthermore I can say that these theories are more important for managers than others because they are the in charge of planning, organizing, leading and controlling an organization.


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