Understanding and Preventing Dysfunctional Behavior in Organizations

Abstract

We review the literature on dysfunctional behavior in organizations and illuminate the potential contribution of human resource development (HRD) to manage such behavior and contribute to strong governance and compliance. The impetus for this article comes from evidence of dysfunctional behavior in banking and financial organizations in many countries in recent times. We define dysfunctional behavior at individual, organizational, and institutional levels of analysis and propose a model of HRD to address dysfunctional behavior at these levels. HRD potentially plays four key roles in the context of managing and/or preventing dysfunctional behavior: development of employee awareness and skills; effective governance of HRD practices, structures, and delivery mechanisms; development of an ethical governance culture and climate and a more far-reaching role than that of organizational governance and agency mediation that minimizes the possibility of dysfunctional organizational behavior. We conclude with a discussion of HRD research and practice implications.