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Organizational behavior 7e by luthans chap002

Chapter Two

Environmental Context:
Information, Technology,
Globalization, Diversity,
and Ethics


© 2008 The McGraw-Hill Companies, Inc. All rights reserved.

Learning Objectives
• Examine the role of information technology.
• Present developments in knowledge
management and human capital/intelligence.
• Discuss the impact of globalization.
• Identify the meaning of diversity and its
• Discuss the meaning of ethics and major factors
of ethical behavior.

• Describe major areas of ethical concern and
steps taken to effectively address it.
• Examine specific ethical issues.

• Environmental context for organizational
behavior is markedly different from past.
• Management is forced to rethink
approaches to operations and human
resources because of:
– Information technology, globalization,
diversity, and ethics.

• Organizations are now more responsive to
both external and internal environments.

Role of Information Technology
• E-business
– Still portrayed as a recent phenomenon and is almost
equated with today’s Internet.

• Knowledge management
– Tangible knowledge assets captured and retained in
organization structures and systems.
– Intangible knowledge or intelligence possessed by
employees and other stakeholders.

• Human/Intellectual capital
– Can be thought of as investors in the business
expecting a return on investment.

• Third phase of globalization - Friedman.
– Fueled by information technology available to
everyone in the world.

• Implications for organizational behavior
are profound and direct.
– Cultures around the world impact the
organizational behavior of managers and
employees quite differently.

Major Reasons for Increasing Diversity

Diversity in Workplace

• Developing the multicultural organization
– Reflects the contributions and interests of
diverse cultural and social groups.
– Acts on a commitment to eradicate social
– Includes the members of diverse cultural and
social groups.
– Follows through on broader external social

Diversity in Workplace

• Individual approaches to managing
– Learning
– Empathy

Organizational Approaches to
Managing Diversity
• Most common techniques include:
– Testing
– Training
– Mentoring
– Work/Family Programs

A Flextime Framework

Innovative Work/Family Programs

Ethics and Ethical Behavior
• Factors determining ethical behavior:

Individuals and groups
External environment

• Other factors leading to ethical problems in
– Peer pressure on people to be less ethical.
– Difference in views from one person to another.

Ethics and Ethical Behavior

• The impact of ethics on “bottom-line”
– Increasing evidence that ethics programs and
being ethical pays off for organizations.

• Employee privacy issues
– Computer technology
– Mandatory drug testing
– Efforts of organizations to control the lifestyles
of their employees.


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