ORGANISATIONAL BEHAVIOUR

Transcription

1 ORGANISATIONAL BEHAVIOUR LECTURE 3, CHAPTER 6

2 A process through which Individuals organize and interpret their sensory impressions in order to give meaning to their environment. PERCEPTION

3 Why is Perception important in OB? Behaviour is based on the perception of reality is, not in reality itself What we perceive can be substantially different from objective reality

4 Factors that influence Perception 1. Perceiver Personal characteristics, attitudes, motivation, interest, past experience and expectations Eg. Policer officers are authoritative or students to be lazy 2. Target - the object being perceived Characteristics of the target; loud people, attractive/unattractive people 3. Situation Time, location, light, heat or other situational factors Nightgowns, sportswear

5 Tries to explain whether an individual s behaviour is internally or externally caused ATTRIBUTION THEORY

6 Person Perception: Making Judgements about Others Attribution Theory judging people depending on the meaning we attribute to a given behaviour Suggests that we attempt to determine whether it was caused internally or externally 1. Internally under personal control of the individual 2. Externally forced by the situation Eg. Employee late to work. How do you reason with that?

7 Determination of internal or external attribution depends on 1. Distinctiveness Whether an individual displays different behaviours in different situations, Is the employee who is late today also one who blows off commitment? If not, then external cause. If so, then internal 2. Consensus Behaves similarly in similar situations Is everyone late today? If not, then internal cause, If so, then external 3. Consistency Is the employee always late?

8 Fundamental Attribution Error Underestimating the influence of external factors when judging someone Sales manager is prone to attribute the poor performance of her sales agents to laziness rather than a competitor introducing an innovative product Success on internal factors (productivity), failures on external (bad luck, co-workers) Self-serving bias: Accepting positive feedback, rejecting negative feedback

9 Cultural Difference in Attribution Korean Manager are more receptive to negative feedback US media attribute failures to individual executives whilst Asian attribute it to the organisation

10 1. Selection Perception 2. Halo Effect 3. Contrast Effect 4. Stereotyping COMMON SHORTCUTS IN JUDGING OTHERS

11 Selective Perception The tendency to selectively interpret what one sees on the basis of one s interests, background, experience and attitudes Only notice cars like your own

12 Halo Effect The tendency to draw a general impression about an individual on the basis of a single characteristic Intelligence, socialbility, appearance E.g. Try and listen to a list of good things about our current govt. General views contaminate our previous ones

13 Contrast Effect Evaluation of a person s characteristics that is affected by comparison with other people recently encountered who rank higher or lower on the same characteristics

14 Stereotyping Judging someone based on one s perception of the group to which that person belongs New Accountant is likely to know about budgeting Stereotypes based on gender, race, age, religion, ethcnicity and weight The more useful, the more dangerous for misuse

15 Specific Applications of Shortcuts 1. Employee Interview 2. Performance Expectations Self-fulfilling Prophecy: A situation in which a person inaccurately perceives a second person, and the resulting expectations cause the second person to behave in ways consistent with the orginal perception 3. Performance Evaluation Subject Evaluation

16 THE LINK BETWEEN PERCEPTION AND INDIVIDUAL DECISION MAKING

17 Perception and Individual Decision Making Top Manager, Mid-level managers and Non-managerial employees are all involved in making decisions Decision is required when a problem arises Discrepancy between the current and desired state

18 Perception plays a role throughout 1. Awareness of a problem and whether decision is required is a perceptual issue 2. Gathering information and determining their importance is another 3. Developing alternatives 4. The Final Outcome Throughout perception distortions can bias analysis and conclusions

19 To improve the way we make decisions in organisations, we must understand the decision-making errors people commit. DECISION MAKING IN ORGANISATIONS

20 The Rational Model Describes how individuals should behave to maximise outcome Assumptions Decision Maker has complete information Able to identify all relevant options in an unbiased manner Chooses the option with the highest utility But people are usually content with acceptable solutions rather than optimal ones Most decisions are made by judgement rather than by a defined prescriptive model

21 Steps in the Rational Decision-Making Model 1. Define the problem 2. Identify the decision criteria 3. Allocate weights to the criteria 4. Develop alternatives 5. Evaluate alternatives 6. Select the best alternative

22 Bounded Rationality A process of making decisions by constructing simplified models that extract the essential features from problems without capturing all their complexity Satisficing: seeking solutions that are satisfactory and sufficient We choose the first acceptable one rather than the optimal one Unrealistic at times to follow the Rational DM Model

23 Intuitive Decision Making An unconscious process created out of distilled experience Outside conscious thought It s fast and usually engages the emotions Not rational But not necessarily wrong Highly developed form of reasoning based on experience and learning Key is to use to intuition with evidence and good judgement

24 Common Biases and Errors in Decision Making 1. Overconfidence Bias Especially novices 2. Anchoring Bias A tendency to fixate on initial information, from which one then fails to adequately adjust for subsequent information Mind gives too much emphasis on first information 3. Confirmation Bias Tendency to seek out information that reaffirms our past choices and to discount information that contradicts them 4. Availability Bias Tendency to base judgement on information that is readily available

25 Common Biases and Errors in Decision Making 5. Escalation of Commitment An increased commitment to a previous decision in spite of negative information 6. Randomness Error Tendency to believe that they can predict the outcome of random events 7. Risk Aversion Tendency to prefer a sure gain of a low amount over a riskier outcome, even of the riskier outcome might have a higher expected payoff Risk averse behaviour when positive outcome, risk seeking behaviour when negative outcome

26 8. Hindsight Bias Common Biases and Errors in Decision Making Tendency to believe falsely after the outcome Is known, that we d have accurately predicted it

27 INFLUENCES ON DECISION MAKING

28 Individual Differences Personality Achievement-seeking and Dutiful People Achievement-seeking escalation of commitment and hindsight bias and Dutiful People Gender Overanalyse Mental Ability Cultural Differences

29 Organisational Constraints Performance Evaluation Reward Systems Formal Regulations System-imposed Time Constraints Historical Precedents

30 END OF CHAPTER