Organizational Behavior Robbins & Judge Chapter 5 Perception and Individual Decision Making
Jan 02, 2016
Organizational Behavior
Robbins & Judge
Chapter 5
Perception and Individual Decision Making
2
Summary of Lecture 27
- Ability
- Learning Theories
- Attitude
- Components of attitude
- Relationship between attitude and behavior
- Job satisfaction and other job attitudes
- Main causes of job satisfaction
- Employees responses to job dissatisfaction
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
3
Learning Objectives
- What is perception?
- Determinants of attribution
- Shortcuts in judgment
- Perception and decision making
- Steps in rational decision making
- Bounded rationality
- Decision biases or errors
- Intuition and decision making
- Ethical decision
- Normative decision model
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
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Perception
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Perception
“Perception is a process by which individuals organize and interpret their sensory impressions
in order to give meaning to their environment”
- Perception is the process through which people select, organize, and interpret information.
- Individual behavior is based on perception of reality not on reality
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
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Process of Perception
OrganizationClassification
Interpretation
Beliefs &Values
Behavior Personal
Meanings
Attention & Selection
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Factors Influencing Perception:
1.) Perceiver
2.) The Perceived
3.) Situation
Perception
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Factors in the situationTimeWork settingSocial setting
Factors in the perceiverAttitudesMotivesInterestsExperienceExpectation
Factors in the targetNoveltyMotionSoundsSizeBackgroundProximitySimilarity
PERCEPTION
Factors that Influence Perception
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Organization• Classification
– Figure and Ground Differentiation• Figure
The Dominant feature being perceived.• Ground
The Surrounding, the compelling Stimuli.• Perceptual Closure
The mind’s tendency it fill in missing data when it receives incomplete information.
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Interpretation
• We add meanings to data take in by our past learning
experience as well as our current beliefs, assumptions,
attitudes, and values; all influence the meaning we add to
what we take in.
• Combined, they form our individual frame of reference,
which is mental filter through which perceptions are
interpreted and evaluated.
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Person Perception
Making Judgments About Others
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Attribution Theory Attribution process is a perceptual process whereby we
interpret the causes of behavior in terms of the person
(internal attributions) or the situation (external attributions).
Two Types of Causes:
1) Internal (internally caused behaviors are believed to be
under control)
2) External (behaviors resulting from outside causes or out of
control)
Absence
Internal: Sleeping, late night party: External: Road accident
Observation InterpretationAttribution of cause
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
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Factors of the Attribution Theory
1) Distinctiveness (whether person display different behaviors based on situation
2) Consensus (if everyone in given situation behaves in similar way)
3) Consistency (observer look for consistency in action)
EXAMPLE: Arriving late in meeting
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
14
External attributions
Internal attributions
Low
Consistency
High
High
Distinctiveness
Low
High
consensus
Low
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
15
Fundamental Attribution Error
When judge behaviors of others we often underestimate the influence of external factors and overestimate influence of personal of internal factors
EXAMPLE: Poor performance of salesperson is believed to be due to laziness and incompetence
Individuals also tend to attribute success to internal factor such as hard work, intelligence and effort
Individuals tend to attribute failure to external factors.
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
16
Self Serving Bias
• A perceptual error whereby people tend to attribute their
own success to internal factors and their failures to
external factors
EXAMPLE: Iraq War
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
17
Self-Fulfilling Prophecy
A phenomenon in which an observer’s expectations of
someone causes that person to act in a way that is
consistent with the observer’s expectations.
Errors or biases distort attributions are universal?
No Culture play its role: Japanese Managers
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
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Self-Fulfilling Prophecy Cycle
Supervisor forms expectations about employee
Expectations affect supervisor's behavior toward employee
Supervisor’s behavior affect employees ability and performance
Employee’s behavior becomes consistent with a supervisor’s expectations
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Shortcuts in Judging Others
1) Selective Perception
2) Halo Effect
3) Contrast Effects
4) Projection
5) Stereotyping
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Shortcuts in Judging Others
• Selective Perception
The tendency to focus on those attributes of people and situations that fit our frame of reference.
– Example: Notice Car like you
Why we use selective perception?
- We can not analyze or assimilate all information
- We select information based on our interests, experience, attitude and background
• Halo Effect
The tendency to overrate a person based on a single trait.
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
21
Shortcuts in Judging Others
- Halo Effect: The tendency to overrate a person based on a single trait.
- For Example: judging bases on intelligence, sociability, communication and appearance
- Example: Judging teacher on its ability to deliver or style
- Contrast Error: Our reaction to person is influenced by other persons recently encountered.
- We don’t evaluate person in isolation
- Example: Selection Interview
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
22
Shortcuts in Judging Others
Projection
- Attributing one's own characteristics while judging other
- Easy to judge if we assume other similar to us
- If you are honest assume that others are also the same
- Fail to recognize individual differences
Stereotyping
- Judging others based on our perception of the group
- A rigid and biased perception of a person, group, object, or situation.
- A process of using a few observable characteristics to assign people to preconceived social category or group
- Process of generalization make us to decide fast (simplifying complex world)
- Perception about Muslims after 9/11Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
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Stereotyping Process
Model
Develop social categories & assign traits to them
Person is identified with a social category based on observable information
Assign social category’s cluster of traits to the person
Example
Athletes are energetic and hardworking. Best
salesman
This person is a athlete
This person is hard working hence good
salesman
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Specific Applications of Short cuts in Organizations
1) Employment Interview
2) Performance Expectations (Self Fulfilling Prophecy or Pygmalion effect)
3) Ethnic Profiling (increase in after 9/11)
4) Performance Evaluation
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
S. No.
Performance Appraisal Error Description
1 Leniency Error Extreme rating either on high or low side
2 Similarity Error Bias appraisal because of personal affiliation
3 Recency Error Recent behavior evaluation instead of entire performance appraisal period
4 Contrast Error Rating in comparison to other members
5 Central Tendency Error Average rating for all employees
6 Spill-Over Effect Past performance or standing dominate recent evaluation
7 Hallo Error One characteristic or aspect of performance dominate entire performance appraisal rating
8 Perceptual Error The previous held believe of perception influence appraisal
4 Performance Appraisal Errors
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Link between Perception and Individual Decision Making
- In organization individuals make decisions (choice between two or more alternatives)
- Decision making often occur in response to problem
- Decision require interpretation and evaluation of information and alternatives solutions/course of actions
- Quality of decision influenced by their perception
- Problem definition varies from person to person
EXAMPLE: Quarterly Sales data
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
27
Rational Decision Making
The Rational Model1)Define problem
2) Identify the decision criteria
3) Allocate weight to the criteria
4) Develop the alternatives
5) Evaluate the alternatives
6) Select the best alternative
Assumptions
1) Problem clarity 2) Known options 3) clear preferences
4) Constant preferences 5) no time or cost constraints
6) Maximum payoffRobbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
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How decisions are made in organizations?
1) Bounded rationality: Limited capacity of individual to observe, understand and interpret all information hence try to find satisfactory or sufficient solutions
Common Biases and Errors
1) Overconfidence bias
2) Anchoring bias
3) Confirmation bias
4) Availability bias
5) Representative bias
6) Escalation of commitment
7) Randomness error
8) Winner's Curse
9) Hindsight bias
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
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Intuitive Decision Making
- “Intuitive decision making can be defined as unconscious process created out of distilled experience”
- Expert based on his experience draw information form past patterns and apply them to current problem to make quick decision
When People make Intuitive Decision?
1 High level of uncertainty 2 Little precedent to draw
3 Variables are less scientifically predicted
4 Facts are limited 5 Facts don point the way
6 Analytical data are of little use
7 Several plausible alternatives 8 Time is limited
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
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Decision Making
1 Individual Differences
I) Personality
ii) Gender
2) Organizational Constraints
I) Performance evaluation
ii) Reward system
iii) Formal regulations
iv) System imposed time constraints
v) Historical precedents
3) Cultural Differences
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
31
Creativity in Decision Making
Creative Potential
ExpertiseCreative skills
Task Motivation
Figure: Components of Creativity
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
32
Creativity in Decision Making
- Traits of Creativity: Openness to experience, intelligence, independence, self confidence, risk taking, internal locus of control, perseverance in frustration and tolerance for ambiguity
1 Expertise (knowledge, skills, and experience)
2 Creative thinking skills (analogies, apply idea from one context to other
3 Intrinsic Task Motivation(work with interest and joy, love their work)
- Other important thing is presence of creativity driven culture
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
33
Ethics in Decision Making
1 Utilitarian Criterion (interest of the organization or stakeholders)
2 Focus on Rights of individuals
3 Justice
- National Culture: No universal principle in this business world,
What is right in America may be wrong in China
- There are some issues where agreement otherwise few Grey areas influence criteria of ethics
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
The Normative Decision Model Decision Styles
Lussier, R. and Achau, C. (2007): Effective Leadership, 3rd Edition, South-Western, Cangage Learning
- Focus on matching leadership decision making style and situation
- Styles are assumed to be learnable
- Decision style depends onQuality requirement of decisionLikelihood of commitment from employees
1 Decide
- Leader makes decision with little or no subordinate input
2 Consult Individually
- Input from subordinates but leader makes decision
The Normative Decision Model
©Lussier, R. and Achau, C. (2007): Effective Leadership, 3rd Edition, South-Western, Cangage Learning
3 Consult Group- Consensus building- Leader shares decision making with group5 Facilitate: Helps define problems- Leader seeking participation and concurrence without
pushing own ideas 6 Delegate- Leader gives total decision making authority to
employees
The Normative Decision Model Decision Styles
Lussier, R. and Achau, C. (2007): Effective Leadership, 3rd Edition, South-Western, Cangage Learning
Deciding Appropriate Leadership Style
1. 1 Decision Significance
2. 2 Importance of Commitment
3. 3 Leader Expertise
4. 4 Likelihood of Commitment
1. 5 Group Support for Objectives
2. 6 Group Expertise
3. 7 Team Competence
Lussier, R. and Achau, C. (2007): Effective Leadership, 3rd Edition, South-Western, Cangage Learning
- Individuals behave based on their perception of environment and situation
- Absenteeism, job turn over, and job satisfaction behaviors are influenced by perception of individuals
- Individuals satisfaction and dissatisfaction level about work conditions, job, policies and structures are based on perception
- Reducing Errors or Biases1) Focus on goal 2) Analyze information that disconfirms your
beliefs 3) Don't try to create meaning out/from random events 4) Increase your options 5) Ask from yourself: Are you
committing biases- Enhance your decision quality by- Analyzing the situation - Adjust your style based on situation and culture – Be aware of biases - Use creativity (out of the box thinking) – Use intuition with rationality
Managerial Implication
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall
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Discussion Question 1: How perception influence behavior?
Discussion Question 2: What are few shortcuts in judgment?
Discussion Question 3: What is relationship between perception and decision making?
Discussion Question 4: What is bounded rationality?
Discussion Question 5: What is intuition?
Discussion Question 6: What is your view point on ethical decision criteria?
Discussion Questions
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Summary
- What is perception?
- Determinants of attribution
- Shortcuts in judgment
- Perception and decision making
- Steps in rational decision making
- Bounded rationality
- Decision biases or errors
- Intuition and decision making
- Ethical decision
- Normative decision model
Robbins and Judge (2008): Organizational Behavior, Pearson, Prentice Hall