chapter 6 - perception and individual decision making

Question 1

perception and why is it important to ob? (on exam)

Answer 1

is a process by which we organize and interpret sensory impressions to give meaning to our environment. What we perceive can be substantially different from objective reality.”

Why is perception important in the study of organizational behavior (OB)?
People’s behavior and decisions are based on their perception of what reality is, not on reality itself

Question 2

factors that influence perception (on exam)

Answer 2

factors in the situation:
time
work setting
social setting

factors in the perceiver:
attitudes
motives
interests
experience
expectations

factors in the target:
novelty
motion
sounds
size background
proximity
similarity

Question 3

attribution theory (on exam)

Answer 3

tries to explain the ways we judge people differently depending on the meaning we attribute to their behavior such as determining whether an individual’s behavior is internally or externally caused.

Question 4

whether attribution is internally or externally caused depends on

Answer 4

distinctiveness
consensus
consistency

Question 5

internally caused behaviors

Answer 5

are those an observer believes to be under the personal behavioral control of another individual (e.g., coming to work late because the coworker is lazy).

Question 6

externally caused behaviors

Answer 6

is what we imagine the situation forced the individual to do (e.g., coming to work late because of bad traffic)

another kind of external attribution: where our relationship with the other person is the reason for the behavior.

ex: you may think a customer stopped doing business with your company because they are
(1) disloyal to the company (e.g., internal),
(2) cutting expenditures due to hard financial times (e.g., external), or
(3) not getting along with the new employee assigned to their account”

Question 7

distinctiveness - interpretation of observation

Answer 7

refers to whether an individual displays different behavior in different situations. Is the employee who arrives late today also one who regularly “blows off” other kinds of commitments? If not, we are likely to give it an external attribution. If yes, we will probably judge the behavior to be internal

Question 8

consensus - interpretation of observation

Answer 8

If everyone who faces a similar situation responds in the same way, we can say the behavior shows consensus.

Question 9

consistency - interpretation of observation

Answer 9

Finally, an observer looks for consistency in a person’s actions. Does the person respond the same way over time

Question 10

fundamental attribution error (organization decision making) (on exam)

Answer 10

might explain why we might perceive the wealthy as intelligent, savvy, or innately effective without considering the external factors that precluded their success (e.g., being born into a wealthy family)

Question 11

self-serving bias (organization decision making) (on exam)

Answer 11

people tend to attribute ambiguous information as relatively flattering, accept positive feedback, and reject negative feedback

Question 12

selective perception

Answer 12

We often choose (sometimes unconsciously) the information we take in from the environment based on our background, motivations, and characteristics

Question 13

halo vs. horn effect

Answer 13

halo: When we draw a positive impression about an individual based on a single characteristic, such as intelligence, sociability, or appearance

horn: when we draw a negative impression from a single characteristic

Question 14

contrast effect

Answer 14

Evaluation of a person’s characteristics that is affected by comparisons with other people recently encountered who rank higher or lower on the same characteristics

ex: the boss begins scheduling meetings, and you hear through the grapevine that Regan is going up first—Regan is the star performer in the office and will be a hard act to follow.

Question 15

heuristics

Answer 15

We deal with our complex world’s unmanageable number of stimuli by using stereotypes or shortcuts called heuristics to make decisions quickly

Question 16

self-fulfilling prophecy and pygmalion effect (not confirmation bias)

Answer 16

People attempt to validate their perceptions of reality even when these perceptions are faulty. how an individual’s behavior is determined by others’ expectations.

if a manager wants the team to do big things they are more likely to

Question 17

six-step rational decision-making model

Answer 17

1. Define the problem
2. Identify the decision criteria
3. Allocate weights to the criteria
4. Develop the alternatives
5. Evaluate the alternatives
6. Select the best alternative

problems with the model: you need to gather a great deal of information about all the options, compute applicable weights, and then calculate values across a huge number of criteria.

Question 18

bounded rationality

Answer 18

We take a simplified approach, perceiving and interpreting the essential features of problems without capturing their complexity. We then behave rationally within these boundaries

Bounded rationality can be of concern in ethical decision making. Not only are we prone to make systematic and predictable errors in ethical decisions,

Question 19

intuitive decision making

Answer 19

Perhaps the least rational way of making decisions is intuitive decision making, an unconscious process created from distilled experience.

occurs outside conscious thought; relies on holistic associations, or links between disparate pieces of information; is fast; and is affectively charged, meaning it engages the emotions. While intuition is not rational, it is not inherently bad or necessarily wrong, nor does it always contradict rational analysis

Question 20

how to reduce biases and errors in decision making

Answer 20

Focus on Goals. Without goals, you cannot be rational, you do not know what information you need, you do not know which information is relevant and which is irrelevant

Look for Information That Disconfirms Your Beliefs. When we overtly consider various ways we could be wrong, we challenge our tendencies to think we are smarter than we actually are.

Do Not Try to Create Meaning out of Random Events.

Increase Your Options.

Question 21

overconfidence bias (organization decision making) (on exam)

Answer 21

We tend to be too confident about our abilities and the abilities of others, but we are usually not aware of this overconfidence bias. This overconfidence can emerge in organizations, especially during informal interviews

Question 22

anchoring bias (organization decision making) (on exam)

Answer 22

is a tendency to fixate on initial information and fail to adequately adjust to subsequent information.Similar to the halo and horns effects discussed earlier, the mind appears to disproportionately emphasize the first information it receives

Question 23

confirmation bias (organization decision making) (on exam)

Answer 23

represents a case of selective perception: We seek out (and accept) information that reaffirms our past choices and current views, and we discount (or are skeptical of) information that challenges them

Question 24

availability bias (organization decision making) (on exam)

Answer 24

is our tendency to base judgments on readily available information. Events that evoke emotions are particularly vivid, and those that are more recent tend to be more available in our memory, leading us to overestimate the chances of unlikely events

Question 25

escalation of commitment

Answer 25

also referred to as the sunk cost effect, refers to our staying with a decision even if there is clear evidence that it is wrong.

Question 26

randomness error (organization decision making) (on exam)

Answer 26

People default toward believing that they have some control over the world. Our tendency to believe we can predict the outcome of random events is the randomness error

Question 27

risk aversion

Answer 27

This tendency to prefer a sure thing over a risky outcome is risk aversion

Question 28

hindsight bias (organization decision making) (on exam)

Answer 28

is the tendency to believe falsely, after the outcome is known, that we would have accurately predicted it. When we have feedback on the outcome, we seem good at concluding it was obvious

Question 29

outcome bias (organization decision making) (on exam)

Answer 29

s the tendency to judge the quality of a decision based on the desirability or believability of its outcome. If we have information about the quality of an outcome, we may jump to the conclusion that the decision was strong

Question 30

how to limit the extent to which biases affect our decision making

Answer 30

Employees and managers would do well to take a step back and

(1) reflect and reframe problems in different ways;
(2) undergo training on structured decision-making approaches to rely less on fast, emotional heuristics; and
(3) alter the way in which decisions are made to reduce bias, such as through setting explicit standards for decisions

Question 31

three personality traits are related to taking on specific decision-making strategies

Answer 31

intuition - can lead them to make a riskier decision or even to be harsher when condemning unethical behavior.

high self esteem - use the self-serving biases to preserve their esteem. They may be more prone to blame others for their failures while taking credit for successes

narcissists - naturally tend to be prone to overconfidence or overclaiming and to self-serving biases

Question 32

big five model and how they are related to taking on specific decision-making strategies

Answer 32

high openness - less prone to selective perception or confirmation bias
extroversion - riskier behavior in ceos
conscientiousness - affect escalation of commitment
achievement - escalate commitment and hindsight bias
dutiful - inclined to do best for org and less likely to escalate their commitment

Question 33

utilitarinism

Answer 33

which proposes making decisions solely based on their outcomes, ideally to provide the greatest good for all.

Decision makers, particularly in for-profit organizations, feel comfortable with utilitarianism. The “best interests” of the organization and its stockholders can justify a lot of questionable actions, such as large layoffs.

Question 34

creative behavior in four steps

Answer 34

1. Problem formulation. Any act of creativity begins with a problem that the behavior is designed to solve. Thus, problem formulation is the stage of creative behavior in which we identify a problem or opportunity that requires a solution that is yet unknown.
2. Information gathering. Given a problem, the solution is rarely clear at the outset. We need time to learn more and process what we have learned. Thus, information gathering is the stage of creative behavior when knowledge is sought and possible solutions to a problem incubate. Information gathering leads us to identifying innovation opportunities
3. Idea generation. Idea generation is the process in which we develop possible solutions to a problem from relevant information and knowledge. Curiosity has been found to be a driver of idea generation: When you are curious about something, you are more likely to link earlier ideas or earlier solutions to help solve the current problem.188 Idea generation has implications for group dynamics.
4. Idea evaluation. Finally, it is time to choose from the ideas we have generated. Thus, idea evaluation is the process of creative behavior in which we evaluate potential solutions to identify the best one. Sometimes the method of choosing can be innovative.

Question 35

(on exam) perception and decision making

Answer 35

Individuals make decisions, or choices from among two or more alternatives.Ideally, decision making would be objective rather than subjective, but the ways individuals make decisions are largely influenced by their perceptions.