1. PRESENTED BY : Mir Zeeshan Ali
PERCEPTION AND INDIVIDUAL
DECISION MAKING
2. Learning Objectives
1. Perception and the factors that influence it.
2. Attribution Theory
3. Making judgements about others
4. Link between Perception and Decision Making
5. Rational Model of Decision Making
6. Common Decision biases or errors
7. Individual differences and organizational constraints
affects decision making
8. Three Ethical decision criteria
9. Creativity
10. Global Implications
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3. Perception
• Perception is the process of receiving information about
and making sense of the world around us. It involves
deciding which information to notice, how to categorize
this information and how to interpret it within the
framework of existing knowledge.
• A process by which individuals organize and interpret their
sensory impressions in order to give meaning to their
environment.
“WE DON’T SEE THINGS AS THEY ARE, WE SEE THINGS AS
WE ARE”
4. Factors That Influence Perception
Factors in the perceiver
• Attitudes
• Motives
• Interests
• Experience
• Expectations
Factors in the situation
• Time Perception
• Work Setting
• Social Setting
Factors in the Target
• Novelty
• Motion
• Sounds
• Size
• Background
• Proximity
• Similarity
5.
6.
7.
8.
9. Attribution Theory
Perceptions we have of people
Observing individual's behavior
Internal external
Distinctiveness Consensus
consistency
13. DISTORTIONS
Distortions In attributions
Fundamental attribution error Self serving bias
Under estimating the influence of Indviduals and organisations tend to
External factors Attributing success to ability/ effort,
Over estimate the influence of blame for failure on
Internal or personal factors bad luck/ unproductive coworkers
17. LINK BETWEEN PERCEPTION &INDIVIDUAL
DECISION MAKING
• What is perception and its importance?
• Factors influencing perception.
• How decision should be made?
• How to improve quality of decision?
18. Decision-Making Organizations
• Rational Model: Characterized by making consistent, value-
maximizing choices within specified constraints.
• Six – Step Decision Process:
4. Define problem
5. Identify decision criteria
6. Allocate weights to the criteria
7. Develop alternatives
8. Evaluate alternatives
9. Select the best alternatives
19. Decision-Making Organizations
• Bounded Reality: A process of making
decision by constructing simplified models that
extracts the essential features from problems
without capturing all their complexity.
• Intuition: An unconscious process created out
of distilled experience.
20. “Good Enough” Lacks
versus Complete
Optimizing Information
Bounded
Rationality
Cannot Cannot
Assess All Weigh
Alternatives All Criteria
22. Common Biases & Errors in decision making
Common biases and Errors in decision making :
2. Overconfidence bias
3. Anchoring bias
4. Confirmation bias
5. Availability bias
6. Escalation of commitment
7. Randomness Error
8. Winner’s Curse
23. Individual Differences in decision-making
• Personality:
Conscientiousness may effect escalation of commitment
3. Achievement-strivers are likely to increase commitment
4. Dutiful people are less like to have this bias
• Gender:
8. Women analyze decisions more than men rumination
9. Women are twice as likely to develop depression
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24. Organizational Constraints
Performance Evaluation
Managerial evaluation criteria influence actions
Reward Systems
Managers will make the decision with the greatest personal
payoff for them
Formal Regulations
limit the alternative choices of decision makers
System-imposed Time Constraints
Restrict ability to gather or evaluate information
Historical Precedents
Past decisions influence current decisions
25. Ethics in Decision Making
Ethics, also known as moral philosophy, is a branch
of philosophy that addresses questions about morality — that is,
concepts such as good and evil, right and
wrong, virtue and vice, justice and crime, etc.
Here are some criteria that can help ensure appropriate ethical
considerations are part of the decisions being made in the
organization .
• Compliance.
• Promote good and reduce harm.
• Responsibility.
• Respects and preserves rights.
• Promotes trust.
• Builds reputation
26. Three Ethical Decision Criteria
An individual can use three different criteria in making ethical choices
• Utilitarian criterion;
- Decisions are made solely on the basis of their outcomes or consequences.
- The goal is to provide the greatest god for the greatest number.
- It promotes efficiency and productivity, but it can result in ignoring the rights of some
individuals, particularly those with minority representation.
• Focus on Rights
- To make decisions consistent with fundamental liberties and privileges as set forth in
documents such as Constitution of India.
- It means respecting and protecting the basic rights of individuals.
- It creates an overly legalistic work environment that hinders productivity and efficiency.
• Focus on Justice
- This requires individuals to impose and enforce rules fairly and impartially so that there is an
equitable distribution of benefits and costs.
- It justifies paying people the same wage for a given job, regardless of performance
differences and using seniority as the primary determination in making layoff decisions.
- It encourages a sense of entitlement that reduces risk taking, innovation and productivity.
27. CREATIVITY
• The ability to produce novel & useful ideas i.e different from
what’s been done before but that are appropriate to the problem
or oppurtunity presented.
• Why is creativity important to decision making ?
• Three component model of creativity
Expertise
Creative thinking skill
Intrinsic task motivation
