Perception

and Individual
Decision Making
 What Is Perception?
Perception
A process by which ••People’s
individuals organize and People’sbehavior
behavior isis
based
basedon ontheir
their
interpret their sensory
impressions in order to perception
perceptionof of what
what
give meaning to their reality
realityis,
is,not
not on
onreality
reality
environment. itself.
itself.
••The
Theworld
worldas
asititisis
perceived
perceivedisis the
theworld
world
that
thatisisbehaviorally
behaviorally
important.
important.
 Perceptual Process
• External
Stimuli……….Hearing,Feeling,seeing,smelling and
tasting
• Perceptual selection…..External
factors..Intensity,size,contrast repetation, interest
personality motivation
• Perceptual Organization….organizing for
responding
• Perceptual Interpretation..Response
Factors that
Influence
Perception
 Person Perception: Making Judgments About
Others

Attribution Theory
When individuals observe
behavior, they attempt to
determine whether it is
internally or externally
caused.

Distinctiveness:
Distinctiveness:Shows
Showsdifferent
differentbehaviors
behaviorsinindifferent
differentsituations.
situations.
Consensus:
Consensus:Response
Responseisisthe
thesame
sameas
asothers
otherstotosame
samesituation.
situation.
Consistency:
Consistency:Responds
Respondsininthe
thesame
sameway
wayover
overtime.
time.
Attribution Theory
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

In
Ingeneral,
general,wewe
tend
tendto
toblame
blamethe the
person
personfirst,
first, not
not
the
thesituation.
situation.
 Errors and Biases in Attributions
(cont’d)
Self-Serving Bias Thought:
Thought:When
When
The tendency for individuals to students
studentsgetgetanan“A”
“A”on
on
attribute their own successes to an
anexam,
exam, they
theyoften
often
internal factors while putting the say
saythey
theystudied
studiedhard.
hard.
blame for failures on external But
Butwhen
whenthey
they don’t
don’t
factors do
dowell,
well, how
howdoes
doesthe
the
self-serving
self-servingbias
bias
come
comeinto
intoplay?
play?
Hint:
Hint:Whose
Whosefault
fault isisitit
usually
usuallywhen
whenan
anexam
exam
isis“tough”?
“tough”?
 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 person’s 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 one’s own
characteristics to other
people

Stereotyping
Judging someone on the
basis of one’s 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 (forecast): 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 out—typically on the basis of race or
ethnicity—for intensive inquiry, scrutinizing, or
investigation
 Specific Applications in Organizations (cont’d)

• Performance Evaluations
– Appraisals are often the subjective
(judgmental) perceptions of appraisers of
another employee’s job performance.
The Link Between Perceptions and Individual Decision
Making

Problem
A perceived discrepancy
between the current state of
affairs and a desired state Perception
Perceptionof
of
the
theDecision
Decision
Maker
Maker
Decisions
Choices made from among
alternatives developed from
data perceived as relevant

Outcomes
Rational Decision-making Model
Rational Decision-
making Model Model
ModelAssumptions
Assumptions
Describes how individuals •• Problem
Problemclarity
clarity
should behave in order to •• Known
Knownoptions
options
maximize some outcome
•• Clear
Clearpreferences
preferences
•• Constant
Constantpreferences
preferences
•• No
Notime
timeor
orcost
cost
constraints
constraints
•• Maximum
Maximumpayoff
payoff
 Steps in the Rational Decision-making Model
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.
 Bounded Rationality Decision
Making Model
Bounded Rationality
Individuals make decisions by constructing
simplified models that extract the essential
features from problems without capturing all
their complexity.
 Cont’d……

• How/Why problems are Identified

– 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 ability to make
good decisions

• Anchoring Bias
– Using early, first received information as the
basis for making subsequent judgments

• Confirmation Bias
– Using only the facts that support our decision
 Common Biases and Errors
• Availability Bias
– Using information that is most readily at hand
• Recent
• Vivid
 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 don’t 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
 Toward Reducing Bias and Errors
• Focus on goals.
– Clear goals make decision making easier and help to
eliminate options inconsistent with your interests.
• Look for information that disconfirms beliefs.
– Overtly considering ways we could be wrong challenges
our tendencies to think we’re smarter than we actually
are.
• Don’t try to create meaning out of random events.
– Don’t attempt to create meaning out of coincidence.
• Increase your options.
– The number and diversity of alternatives generated
increase the chance of finding an outstanding one.