SOLUTION: OBD 6 UOTC Stereotyping Ethical Decisions for The Trust in Employees Discussion

Essentials of Organizational Behavior
Fourteenth Edition
Chapter 6
Perception and Individual
Decision Making
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
After studying this chapter you should be
able to:
1. Explain the factors that influence perception.
2. Describe attribution theory.
3. Explain the link between perception and decision
making.
4. Contrast the rational model of decision making
with bounded rationality and intuition.
5. Explain how individual differences and
organizational constraints affect decision making.
6. Contrast the three ethical decision criteria.
7. Describe the three-stage model of creativity.
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Perception
• Perception: A process by which individuals
organize and interpret their sensory impressions
in order to give meaning to their environment
• The world as it is perceived is the world that is
behaviorally important
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Factors Influencing Perception
Perceiver
Situation
Target
Perception
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Person Perception: Attribution Theory
• Attribution Theory: Suggests that perceivers try
to “attribute” the observed behavior to a type of
cause:
– Internal – behavior is believed to be under the personal
control of the individual
– External – the person is forced into the behavior by
outside events/causes
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Determinants of Attribution
• Distinctiveness – whether an individual displays
different behaviors in different situations (the
uniqueness of the act)
• Consensus – does everyone who faces a similar
situation respond in the same way as the
individual did?
• Consistency – does the person respond the same
way over time?
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Attribution Theory
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Attribution Errors and Biases
• Fundamental attribution error:
– Tendency to underestimate the influence of external
factors and overestimate that of internal factors
• Self-serving bias: Occurs when individuals
overestimate their own (internal) influence on
successes and overestimate the external
influences on their failures
– The basic process of attribution applies across
cultures, but Western cultures tend to be more
individualist, while Asian cultures are more group
oriented
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Shortcuts Used in Judging Others
• Selective Perception: A perceptual filtering
process based on interests, background, and
attitude
• Halo Effect: Drawing a general impression based
on a single characteristic
• Contrast Effects: Our reaction is influenced by
others we have recently encountered (the context
of the observation)
• Stereotyping: Judging someone on the basis of
the perception of the group to which they belong
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
The Link Between Perception and
Decision Making
• Decision making occurs as a reaction to a
perceived problem
• Perception influences:
– Awareness that a problem exists
– The interpretation and evaluation of information
– Bias of analysis and conclusions
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Rational Decision-Making Model
• Rational decision-making model
1.
2.
3.
4.
5.
6.
Define the problem
Identify the decision criteria
Allocate weights to the criteria
Develop the alternatives
Evaluate the alternatives
Select the best alternative
• This model is seldom actually used: it’s more of a
goal than a practical method
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Bounded Rationality
• The limited information-processing capability of
human beings makes it impossible to assimilate
and understand all the information necessary to
optimize
– People seek solutions that are satisfactory and
sufficient, rather than optimal (they “satisfice”)
• Bounded rationality is constructing simplified
models that extract the essential features from
problems without capturing all their complexity
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Decision Making in Bounded Rationality
• Simpler than rational decision making, decision
making under bounded rationality is composed of
three steps:
1. Limited search for criteria and alternatives – familiar
criteria and easily found alternatives
2. Limited review of alternatives – focus on alternatives,
similar to those already in effect
3. Satisficing – selecting the first alternative that is “good
enough”
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Intuitive Decision Making
• Intuitive decision making: A non-conscious
process created out of distilled experience
– Increases with experience
– Can be a powerful complement to rational analysis in
decision making
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Common Biases and Errors
• Overconfidence Bias: As managers and employees
become more knowledgeable about an issue, the less
likely they are to display overconfidence
• Anchoring Bias: A tendency to fixate on initial
information and fail to adequately adjust for
subsequent information
• Confirmation Bias: Seeking out information that
reaffirms our past choices and discounting information
that contradicts past judgments
• Availability Bias: Basing judgments on readily
available information
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
More Biases and Errors
• Randomness Error: Our tendency to believe we
can predict the outcome of random events
• Escalation of Commitment: Staying with a
decision even when there is clear evidence that it
is wrong
• Risk Aversion: Preferring a sure thing over a
risky outcome
• Hindsight Bias: Believing falsely that we could
have predicted the outcome of an event after that
outcome is already known
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Individual Differences on Decision Making
• Personality
• Gender
• General mental ability
• Cultural differences
• Nudging
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Organizational Constraints on Decision
Making
• Performance evaluations
• Reward systems
• Formal regulations
• System-imposed time constraints
• Historical precedents
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Ethical Frameworks for Decision Making
• Utilitarianism
– Provide the greatest good for the greatest number
• Rights
– Make decisions consistent with fundamental liberties
and privileges
• Justice
– Impose and enforce rules fairly and impartially so that
there is equal distribution of benefits and costs
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Behavioral Ethics
• Behavioral ethics
– Analyzing how people actually behave when
confronted with ethical dilemmas
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Creativity in Organizations
• Creativity: The ability to produce novel and useful
ideas
• Helps people:




See problems others can’t see
Better understand the problem
Identify all viable alternatives
Identify alternatives that aren’t readily apparent
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Three-Stage Model of Creativity
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Creative Behavior
Steps:
1. Problem formulation: identify a problem or
opportunity that requires a solution as yet
unknown
2. Information gathering: possible solutions
incubate in an individual’s mind
3. Idea generation: develop possible solutions
from relevant information and knowledge
4. Idea evaluation: evaluate potential solutions
and identify the best one
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Causes of Creative Behavior
• Cause of creative behavior:
1.
2.
3.
4.
Intelligence
Personality
Expertise
Ethics
• Creative environment
– Motivation
– Rewards and recognition
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Creative Outcomes
• Creative outcomes: ideas or solutions judged to
be novel and useful by relevant stakeholders
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Implications for Managers
• Behavior follows perception, so to influence employee
behavior at work, assess how employees perceive their
work.
• Make better decisions by recognizing perceptual biases
and decision-making errors we tend to commit.
• Adjust your decision-making approach to the national
culture you’re operating in and to the criteria your
organization values.
• Combine rational analysis with intuition.
• Try to enhance your creativity.
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.
Copyright
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved.

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