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Understanding Perception in Decision Making

This document discusses perception and decision making. It defines perception as how individuals organize and interpret sensory information to understand their environment. People's behavior is based on their perceptions, not objective reality. When making judgments about others, people use attribution theory to determine if behaviors are internally or externally caused. However, people are subject to biases like the fundamental attribution error and self-serving bias. Organizations can also be influenced by perceptual biases in areas like hiring, performance evaluations, and ethnic profiling. While rational decision making aims to maximize outcomes, actual decisions are bounded rational and subject to biases. Culture also influences problem selection and decision approaches. The document provides ways to improve decision making including analyzing biases, combining rational and intuitive thinking, and enhancing creativity.

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Anu Gupte
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0% found this document useful (0 votes)
25 views24 pages

Understanding Perception in Decision Making

This document discusses perception and decision making. It defines perception as how individuals organize and interpret sensory information to understand their environment. People's behavior is based on their perceptions, not objective reality. When making judgments about others, people use attribution theory to determine if behaviors are internally or externally caused. However, people are subject to biases like the fundamental attribution error and self-serving bias. Organizations can also be influenced by perceptual biases in areas like hiring, performance evaluations, and ethnic profiling. While rational decision making aims to maximize outcomes, actual decisions are bounded rational and subject to biases. Culture also influences problem selection and decision approaches. The document provides ways to improve decision making including analyzing biases, combining rational and intuitive thinking, and enhancing creativity.

Uploaded by

Anu Gupte
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd

PERCEPTION

Dr Sireesha Mamidenna

What do you see?

What Is Perception, and Why Is It Important?


Perception A process by which individuals organize and interpret their sensory impressions in order to give meaning to their environment.

Peoples behavior is Peoples behavior is based on their based on their perception of what perception of what reality is, not on reality is, not on reality itself. reality itself. The world as it is The world as it is perceived is the world perceived is the world that is behaviorally that is behaviorally important. important.

Person Perception: Making Judgments About Others


Attribution Theory When individuals observe behavior, they attempt to determine whether it is internally or externally caused.
Distinctiveness: shows different behaviors in different Distinctiveness: shows different behaviors in different situations. situations. Consensus: response is the same as others to same Consensus: response is the same as others to same situation. situation. Consistency: responds in the same way over time. Consistency: responds in the same way over time.

Errors and Biases in Attributions Fundamental Attribution Error


The tendency to underestimate the influence of external factors and overestimate the influence of internal factors when making judgments about the behavior of others.

Self-Serving Bias

Errors and Biases in Attributions (contd)

The tendency for individuals to attribute their own successes to internal factors while putting the blame for failures on external factors.

Frequently Used Shortcuts in Judging Others


Selective Perception People selectively interpret what they see on the basis of their interests, background, experience, and attitudes.

Frequently Used Shortcuts in Judging Others


Halo Effect Drawing a general impression about an individual on the basis of a single characteristic

Contrast Effects Evaluation of a persons characteristics that are affected by comparisons with other people recently encountered who rank higher or lower on the same characteristics.

Frequently Used Shortcuts in Judging Others


Projection Attributing ones own characteristics to other people. Stereotyping Judging someone on the basis of ones perception of the group to which that person belongs.

Specific Applications in Organizations


Employment Interview
Perceptual biases of raters affect the accuracy of interviewers judgments of applicants.

Performance Expectations
Self-fulfilling prophecy (pygmalion effect): The lower or higher performance of employees reflects preconceived leader expectations about employee capabilities.

Ethnic Profiling
A form of stereotyping in which a group of individuals is singled outtypically on the basis of race or ethnicityfor intensive inquiry, scrutinizing, or investigation.

Specific Applications in Organizations (contd)


Performance Evaluations
Appraisals are often the subjective (judgmental) perceptions of appraisers of another employees job performance.

Employee Effort
Assessment of individual effort is a subjective judgment subject to perceptual distortion and bias.

The Link Between Perceptions and Individual Decision Making


Problem A perceived discrepancy between the current state of affairs and a desired state. Decisions Choices made from among alternatives developed from data perceived as relevant. Perception Perception of the of the decision decision maker maker

Outcomes

Assumptions of the Rational Decision-Making Model


Rational DecisionMaking Model Describes how individuals should behave in order to maximize some outcome. Model Assumptions Model Assumptions Problem clarity Problem clarity Known options Known options Clear preferences Clear preferences Constant Constant preferences preferences No time or cost No time or cost constraints constraints Maximum payoff Maximum payoff

Creativity

The Three Components of Creativity

The ability to produce novel and useful ideas. Three-Component Model of Creativity Proposition that individual creativity requires expertise, creative-thinking skills, and intrinsic task motivation.

How Are Decisions Actually Made in Organizations


Bounded Rationality Individuals make decisions by constructing simplified models that extract the essential features from problems without capturing all their complexity.

How/Why problems are identified

How Are Decisions Actually Made in Organizations (contd)


Visibility over importance of problem
Attention-catching, high profile problems Desire to solve problems

Self-interest (if problem concerns decision maker)

Alternative Development
Satisficing: seeking the first alternative that solves problem. Engaging in incremental rather than unique problem solving through successive limited comparison of alternatives to the current alternative in effect.

Common Biases and Errors


Overconfidence Bias
Believing too much in our own decision competencies.

Anchoring Bias
Fixating on early, first received information.

Confirmation Bias
Using only the facts that support our decision.

Availability Bias
Using information that is most readily at hand.

Representative Bias
Assessing the likelihood of an occurrence by trying to match it with a preexisting category.

Common Biases and Errors


Escalation of Commitment
Increasing commitment to a previous decision in spite of negative information.

Randomness Error
Trying to create meaning out of random events by falling prey to a false sense of control or superstitions.

Hindsight Bias
Falsely believing to have accurately predicted the outcome of an event, after that outcome is actually known.

Intuition
Intuitive Decision Making
An unconscious process created out of distilled experience.

Conditions Favoring Intuitive Decision Making


A high level of uncertainty exists There is little precedent to draw on Variables are less scientifically predictable Facts are limited Facts dont clearly point the way Analytical data are of little use Several plausible alternative solutions exist Time is limited and pressing for the right decision

Organizational Constraints on Decision Makers


Performance Evaluation
Evaluation criteria influence the choice of actions.

Reward Systems
Decision makers make action choices that are favored by the organization.

Formal Regulations
Organizational rules and policies limit the alternative choices of decision makers.

System-imposed Time Constraints


Organizations require decisions by specific deadlines.

Historical Precedents
Past decisions influence current decisions.

Cultural Differences in Decision Making


Problems selected Time orientation Importance of logic and rationality Belief in the ability of people to solve problems Preference for collect decision making

Ethics in Decision Making


Ethical Decision Criteria
Utilitarianism
Seeking the greatest good for the greatest number.

Rights
Respecting and protecting basic rights of individuals such as whistleblowers.

Justice
Imposing and enforcing rules fairly and impartially.

Ethics in Decision Making


Ethics and National Culture
There are no global ethical standards. The ethical principles of global organizations that reflect and respect local cultural norms are necessary for high standards and consistent practices.

Ways to Improve Decision Making


1. Analyze the situation and adjust your decision making style to fit the situation. 2. Be aware of biases and try to limit their impact. 3. Combine rational analysis with intuition to increase decision-making effectiveness. 4. Dont assume that your specific decision style is appropriate to every situation. 5. Enhance personal creativity by looking for novel solutions or seeing problems in new ways, and using analogies.

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