5 CHAPTER 5 Perception and Individual Decision Making 2 Perception Perception: The process by which individuals select, organize, and interpret the input.

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2 CHAPTER 5 Perception and Individual Decision Making

Perception

Perception: The process by which individuals select, organize, and interpret the input from their senses.

Schemas, motivational state, and mood all play a part in perception.


Components of Perception

Perceiver: The person trying to interpret some observation that he or she has just made.

Target: Whatever the perceiver is trying to make sense of.

Situation: The context in which the perception takes place.


FIGURE 4.2 Characteristics of the Perceiver That Affect Perception


Schemas

• Schemas: Abstract knowledge structures that are stored in memory and make possible the organization and interpretation of information about targets of perception.


Motivational State and Mood

• Motivational State: The needs, values, and desires of a perceiver at the time of perception.

• Mood: How a perceiver feels at the time of perception.


Characteristics of the Target and the Situation

TARGET:

• Ambiguity• Social Status• Motion• Size

SITUATION:

• Salience– novel

– standing out

– inconsistent with expectations


Salience

The extent to which a target of perception stands out in a group of people or things. Causes might be:

• Being novel

• Standing out

• Being Inconsistent with Expectations


Perception Biases and Problems• Primacy Effects*• Contrast Effects• Halo Effect• Similar-to-me Effects*• Harshness, Leniency, and Average Tendency Biases*• Knowledge-of-Predictor Bias*• Selective Perception• Projection• Stereotyping


Primacy Effects

The initial pieces of information that a perceiver has about a target have an inordinately large effect on the perceiver’s perception and evaluation of the target.

For example, interviewers decide in the first few minutes whether or not a job candidate is a good prospect.


Contrast Effects

The perceiver’s perceptions of others distort the perceiver’s perception of a target.

For example, a manager’s perception of an average subordinate is likely to be lower if that subordinate is in a group with very high performers rather than in a group with very low performers.


Halo Effect

The perceiver’s general impression of a target distorts his or her perception of the target on specific dimensions.

For example, a subordinate who has made a good overall impression on a supervisor is rated as performing high-quality work and always meeting deadlines even when work is flawed.


Similar-to-Me Effects

People perceive others who are similar to themselves more positively than they perceive those who are dissimilar.

For example, supervisors rate subordinates who are similar to them more positively than they deserve.


Harshness, Leniency, and Average Tendency Biases

Some perceivers tend to be overly harsh in their perceptions, some overly lenient. Others view most targets as being about average.

For example, some supervisors give nearly everyone a poor rating, some give nearly everyone a good rating, and others give mostly average ratings.


Knowledge-of-Predictor Bias

Knowing how a target stands on a predictor of performance influences perceptions of the target.

For example, a professor perceives a student more positively than she deserves because the professor knows the student had a high score on the SAT.


Selective Perception

selectively interpret what see based on own interests, background, experience, and attitudes.


Projection

attribute own characteristics to others.


Stereotyping

judge someone on the basis of the perception of the group to which they belong instead of their own characteristics.


Definition

Attribution Theory: A group of theories that describe how people explain the causes of behavior.


FIGURE 4.3 Types of Attributions

CHAPTER 5 Perception and Individual Decision Making

Sources of Information

Internal attribution if • low consensus, • low distinctness, • high consistency

External attribution if • high consensus, • high distinctness,

• high consistency

Prentice Hall, 2001


Attribution of Cause

InterpretationObservation

Attribution Attribution

Theory andTheory and

IndividualIndividual

BehaviorBehavior

ExternalExternal

ExternalExternal

ExternalExternal

InternalInternal

InternalInternal

InternalInternal

DistinctivenessDistinctiveness

ConsensusConsensus

ConsistencyConsistency

HighHigh

HighHigh

HighHigh

LowLow

HighHigh

LowLow


Attributional Biases

Fundamental attribution error - the tendency to overattribute behavior to internal rather than external causes.

Actor-observer effect - the tendency to attribute the behavior of others to internal causes and to attribute one’s own behavior to external causes.


Attributional Bias

Self-serving attribution - the tendency to:

• perceive own success as internal and failures as external.

• perceive others success as external, and failure as internal

take credit for successes and avoid blame for failures.


Definition

Decision Making: The process by which members of an organization choose a specific course of action to respond to both problems and opportunities.


The Decision-Making Process

• Rational Model of Decision Making

• Bounded Rationality

• Intuitive Model


Rational Model of Decision Making

• A prescriptive approach based on the assumptions that the decision maker has all the necessary information and will choose the best possible solution or response.

Prentice Hall, 2001


Rational Model of

Decision Making

Problem

Identify andDefine Problem

DevelopAlternatives

A1

A2

A3

A4

An

EvaluateAlternatives

+

A1 A1

A2 A2

An An

Criteria

Weightthe Criteria

T E C H

Set DecisionCriteria

Choice

Make OptimalDecision


Assumptions of the Rational Model

• Problem clarity.

• Known options.

• Clear preferences.

• Constant preferences.

• No time or cost constraints.

• People choose maximum payoff.

• People have very high computational abilities


Bounded Rationality

Bounded Rationality: People’s ability to reason is constrained by the limitations of the human mind itself. If a problem is too complicated people simplify it and use satisficing

Satisficing: Searching for and choosing the first acceptable response or solution, not necessarily the best possible one.


Intuitive Model

• an unconscious process created out of distilled experience.

• intuition is often based on accumulated experiences which allow one to recognize patterns.

• Main problem: since the criteria are not open to examination, intuition is often strongly influenced by perceptual biases.

Prentice Hall, 2001


Intuitive Decision Making most common under conditions of

High uncertainty levels Little precedent Hard to predictable variables Limited facts Unclear sense of direction Analytical data is of little use Several plausible alternatives Time constraints


Sources of Error in Decision Making

• Perceptual Biases

• Heuristics – Availability– Representitiveness– Anchoring

• Escalation of Commitment


Heuristics:

Rules of thumb that simplify decision making.


FIGURE 14.2 Heuristics and the Biases They May Lead To


Availability Heuristic

• The rule of thumb that says an event that is easy to remember is likely to have occurred more frequently than an event that is difficult to remember.

• Potential bias is overestimating the frequency of vivid, extreme, or recent events and causes.


Availability Biases

• Vividness and Recency– individuals judge events that are easier to

remember to be more numerous than events that are difficult to remember


Representativeness Heuristic

• The rule of thumb that says similar kinds of events that happened in the past are a good predictor of the likelihood of an upcoming event.

• Potential bias is failure to take into account base rates and overestimating the likelihood of rare events.


Representativeness Biases

• Insensitivity to base rates– individuals tend to ignore base rates in assessing

the likelihood of events when other descriptive information is present, even if that other information is irrelevant


Anchoring and Adjustment Heuristic

• The rule of thumb that says that decisions about how big or small an amount should be can be made by making adjustments from some initial amount.

• Potential bias is inappropriate decisions when initial amounts are too high or too low.


Anchoring and Adjustment Biases

• Insufficient anchor adjustment– individuals make estimates for values based on some

initial value, even when the initial value is irrelevant

• Overconfidence– individuals tend to be overconfident of the infallibility

of their judgements when answering difficult questions


One Additional Biases

• Hindsight Bias– after finding out the correct outcome of an

event, individuals tend to overestimate the extent to which they would have predicted that outcome


Escalation of Commitment

• Increased commitment to a previous decision in spite of negative information

• The tendency to invest additional time, money, or effort into what are essentially bad decisions or unproductive courses of action.

Prentice Hall, 2001


The Three Components of Creativity The Three Components of Creativity

Expertise

TaskMotivation

CreativitySkills

Creativity

Prentice Hall, 2001


Analytic Conceptual

BehavioralDirective

Rational IntuitiveWay of Thinking

High

Low

To

lera

nce

fo

r A

mb

igu

ity

Decision-Making StylesDecision-Making Styles

Prentice Hall, 2001


Organizational Organizational ConstraintsConstraints

RewardRewardSystemSystem

HistoricalHistoricalPrecedentsPrecedents

ProgrammedProgrammedRoutinesRoutines

PerformancePerformanceEvaluationEvaluation

5 CHAPTER 5 Perception and Individual Decision Making 2 Perception Perception: The process by which individuals select, organize, and interpret the input.

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