Organisational Behaviour

Glancing through the recent stats, one of the most frequently searched for terms which leads people to this blog seems to be 'organisational behaviour' right now. Since this is becoming a pretty much daily event, I'll take a few minutes out to expand on the idea of this rather esoteric term, and offer some of the best links to sites dealing with it.

In its broadest sense, organisational behaviour is a generic label given to describe the way an organisation aims, strategises and participates in the world we live in today. This is a more complex process than most people initially assume, since although it is predominantly management-driven, there are other and often overlooked aspects which affect an organisation's behaviour at any given time. An organisation's behaviour is often driven by both macroeconomic and microeconomic forces, not just management's strategy. To give a simple example of this, in today's current market climate the medium-term surge in oil prices has affected how many organisations allocate cost and spending controls.

Here are some macroeconomic forces which might affect the way an organisation behaves (without management being able to do much about it):

• Commodity prices
• Emerging market growth rates
• Environmental regulation
• Capital under management (i.e. is there more capital in short-term/long-term funds)
• Technology
• Wars

And here are some microeconomic forces which might affect the way an organisation behaves:

• Interest rates
• Inflation
• Recent performance of local equity markets
• Regulation
• Technology
• Infrastructure (i.e. power lines, telecommunication lines, transport etc.)

The list is far from complete but it at least gives a good sense of the type of factors impacting the way an organisation acts, and perhaps serves as a partial model to start with. Within the limits of the above, an organisation's behaviour is centrally driven by the strategy of the management. Broadly speaking, strategy can be broken down into the following components (in no particular order of importance):

1. Financial strategy
2. Ethical strategy (i.e. environmental concerns etc.)
3. Operational strategy (i.e. day-to-day management of the business)
4. Technological strategy
5. Sales & Marketing strategy
6. Personnell (Management) strategy
7. Competitive-response strategy (i.e. how a company reacts to competition)
8. Supply-chain strategy

This again is not a complete list - if you have any other sugestions leave them in the comments below. If you're curious about organisational behaviour, and want some good, quick analysis of real companies put under a microscope, there are a number of great blogs you can now visit mainly written by a bunch of consultants.

First of all, go and visit Tom Peters' blog. He tends to have a lot to say about every aspect of the organisation, all the way from the lofty hights of mergers and acquisitions down to managament of the company cafeteria. Here is a typical kind of quote:

Hats (waaaay) off to Dell! Along with Wal*Mart it did proffer a spanking new approach to "supply chain" organization and management. Most everybody, including the Army and Marine Corps, have assiduously copied.

And while there are some pretty good runs on Broadway (IBM's dominance stretched over two decades—and "unassailable" GM was on the King's throne for about 25 years), no model is "the last word." "Perpetual revolution" is my message in general, and especially to the likes of CIOs who are dealing with what are still immature technologies.

Then there's Guy Kawasaki. He's a great thinker, writer and venture capitalist and well worth checking out - mainly deals with the technology side of things. He's also quite generous with his time and if you e-mail him, he usually responds. An an example of his kind of work, his latest post The Art of Distribution details the top ways to pass "the test (of) the ability to achieve distribution":

• Define it right
• Separate distribution from virality
• Allocate responsibility
• Obey the law of big numbers
• Look for adjacency
• Focus on revenue
• Look out for the other guy
• Always be thinking, "Bigger pie, bigger pie, bigger pie"
• Sometimes be thinking, "Skim the cream"
• Don't kid yourself

Also, John Nesheim, author of a number of books and someone who really 'gets' the venture capital market. Here's a caption from a recent blog post of his dealing with start-ups:

Financial numbers should be created by the leaders who have to deliver results with the people, equipment and cash they sign up for. Of course investors are expected to challenge the numbers. But I find most of the challenges to be the same: "Find a way to do the same work with a lot less cash."' That results too often in under-funded startups. Sure, the Internet bubble had companies ruined with too much cash. But solid managers with experience know what they need for engineering staff, what wages will get the outstanding talent. They know what they can deliver, when. That is not for the VCs to decide. Instead, after due diligence, the investors are wise to bet on the leaders and stand aside, watching from the board room.

For a more academic pespective, go to Biz Deans Talk, a blog mainly written by the dean of the Instituto de Empresa. It's a good blog, and there are some very sophisticated guest bloggers there too.

On the academic note, you can also check out Harvard Business School's only blogging professor, Andrew McAfee.

Some others for more analysis of organisational behaviour are Steve Shu, Malcom Gladwell (to a lesser extent) and Fredd Kambo who is a consultant with Shell.

Add to this list if you feel so inclined, I merely want to offer a quick aggregation of the best analysts of organisational behaviour. If you're still fascinated after having read all the above, and just can't seem to get enough of the subject, my advice is to go and pursue an MBA.