Organizational behaviour
Siti Nazrana 
Lecture3-Emotionsmoodperceptionindivdecisionmkg.pptxBX3171 Organisational Behaviour Topic 5: Emotions and moods Topic 6: Perception and individual decision making
Lecturer: Jaime Wong
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Topic 5
Emotions and Moods
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https://www.paulekman.com/blog/mood-vs-emotion-difference-between-mood-emotion/
Five factors outlining the difference between mood and emotion
In an excerpt taken from “The Nature Of Emotion”, Dr. Ekman lays out five factors for determining mood vs emotion. Variations in duration, provocation, modulation, facial expression, and awareness of cause support Dr. Ekman’s argument for the difference between mood and emotion.
Duration
In the debate of mood vs emotion, moods can be distinguished from emotions in terms of their duration and, presumably, also in terms of… the neural circuitry that directs and maintains each of these affective states. While there is no agreement about how long an emotion lasts, most of those who study the difference between mood and emotion recognize that moods last longer. I have maintained (Ekman, 1984) that emotions are brief, typically lasting anywhere from a matter of seconds to minutes, at most.
So, when we speak of an emotion lasting for an extended amount of time (hours),it’s more likely that we are summating recurrent emotional episodes within that timeframe and not actually experiencing a constant and consistent emotion. Moods, however, can last for hours, sometimes even days, and can be difficult to shake. It’s important to note that if a particular state endures for weeks or months, though, it is not a mood but more properly identified as an affective disorder.
Provocation of emotion
To add to the complexity of their relationship, moods appear to lower the threshold needed to arouse related emotions. An example of this would be when you’re in an irritable mood and finding yourself feeling angry much more readily than usual.
When in an irritable mood, people construe the world around them in a way that permits, if not calls for, an angry response, as if they are seeking an opportunity to indulge the emotion relevant to their mood.
Modulation of emotion
Looking at the management of emotions vs. moods, it becomes significantly more difficult to modulate (regulate) one’s emotion(s) if they occur during or within a mood. Presumably, a person in an irritable mood will not be able to modulate an episode of anger as easily or quickly as they would otherwise. Not only should the anger during an irritable mood be more intense and less controlled, it should decay more slowly (last longer).
Facial expressions
Another feature used to argue the difference between moods and emotions is expression. Moods do not own their own unique facial expression while many of the emotions do. One infers an irritable mood by seeing many facial expressions of anger, but there is no distinctive facial expression of irritability itself, nor is there for any other mood, emotional traits, or affective disorders.
Awareness of cause
Although I know of no direct evidence to support this final claim, I propose that most people can specify what triggered an emotion but are unable to do so for a mood. Triggers can come from the environment we’re in or from our memory. They can even be imagined.
To say that a person can specify what called forth their emotional reaction is not to suggest that people are typically aware of that event provoking the emotion as it is occurring. If they are, it is likely that the event is unfolding slowly. For most of us, our awareness of the source for that emotional reaction doesn’t occur much before the emotional episode is over, if not much alter. Moods, however, are more opaque in this regard.
Learning Objectives
Identify the sources of emotions and moods
Evaluate the impact emotional labour has on employees
Identify strategies for the regulation and management of emotions
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Introduction
Emotions can greatly influence our attitude towards others, our decision making and our behaviours.
Until recently, the field of OB hasn’t given emotions much attention. Managers tried to create organisations that were emotion-free.
Employees bring emotions to work every day, so no study of OB would be complete without considering the role of emotions in workplace behaviour.
Emotion-free Organisation?
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What is the difference between emotions and moods? What are the basic emotions and moods? Emotions are intense feelings directed at someone or something. Moods are feelings that tend to be less intense than emotions and often lack a contextual stimulus. Thus the similarities are the ‘feelings’ component, but the differences lie in the intensity and context. The basic emotions are: happiness, surprise, fear, sadness, anger and disgust, and are classified as those with a positive affect such as joy and gratitude and those with a negative affect such as anger or guilt.
Are emotions rational? What functions do they serve? Because our emotions provide important information about how we understand the world around us. For instance, a recent study indicated that individuals in a negative mood are better able to discern truthful from accurate information than people in a happy mood. Would we really want a manager to make a decision about firing an employee without regarding either his or her own emotions or those of the employee? The key to good decision making is to employ both thinking and feeling in our decisions.
What are the sources of emotions and moods? The primary sources of emotions and moods are:
Personality—there is a trait component, affect intensity
Time of day
Day of the week
Weather—illusory correlation, no effect
Stress
Social activities
Sleep
Exercise
Age
Gender.
What are emotions and moods?
Affect: a broad range of feelings, including emotions and moods
Emotions:
intense, discrete, short-lived feelings experiences that are often caused by a specific event.
felt and displayed emotions (anger, fear, sad, happy, disgust, surprise)
Role – process information, decision making, interaction
Moods:
longer lived and less intense feelings that often arise without a specific event acting as a trigger.
Feelings made up of multiple emotions
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Emotions are strong feelings with a short duration. They are often viewed as irrelevant or disruptive in the workplace. However, this view of emotions is changing and there is growing agreement that emotions play both a positive and negative role in organisations. Three terms are closely intertwined (1) affect – a broad range of feelings that people experience (2) Emotions – intense feelings that are directed at someone or something (3) moods – feelings that tend to be less intense than emotions and that lack a contextual stimulus. It is unlikely psychologists or philosophers will never completely agree on a set of basic emotions, or even whether there is such a thing. Still, many researchers agree on six essentially universal emotions – anger, fear, sadness, happiness, disgust and surprise.
The closer two emotions are to each other on the continuum the more likely people will confuse them. We sometimes mistake happiness for surprise, but rarely do we confuse happiness and disgust.
Emotions play an important role because they help in processing information, in making decisions, when working in a group, or when interacting with others. Working in an organisation often requires displaying emotions that are different from what people actually feel. At work it is assumed people have two sets of emotions: one set of emotions that are displayed in the outer world and one set of emotions that are actually felt internally.
Emotion = a strong feeling Mood = feelings made up of multiple emotions without a clear onset. These two types of emotions are called displayed and felt emotions. Felt emotions are the feelings an employee actually feels; displayed emotions are those emotions that are visible. Employees display different emotions that they actually feel because only some emotions are considered acceptable to display.
Exhibit 5.1
Affect, emotions and moods
‹#›
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First, we need to discuss three terms that are closely intertwined: affect, emotions and moods. Affect is a generic term that covers a broad range of feelings, including both emotions and moods.Emotions are intense, discrete and short-lived feeling experiences that are often caused by a specific event. Moods are longer lived and less intense feelings than emotions and often arise without a specific event acting as a stimulus. Exhibit 5.1 shows the relationships between affect, emotions and moods.
Affect, emotions and moods are separable in theory; in practice the distinction isn’t always clear. When we review the OB topics on emotions and moods, you may see more information about emotions in one area and moods in another. This is simply the state of the research. Let’s start with a review of the basic emotions, then consider a particular type of emotions, labelled ‘moral emotions’.
The basic emotions
There are dozens of emotions, including anger, contempt, enthusiasm, envy, fear, frustration, disappointment, embarrassment, disgust, happiness, hate, hope, jealousy, joy, love, pride, surprise and sadness. Numerous researchers have tried to limit them to a fundamental set.4 Other scholars argue that by thinking in terms of ‘basic’ emotions, we lose sight of the bigger picture because emotions can mean different things in different contexts and may vary across cultures.5
Psychologists have tried to identify basic emotions by studying how we express them. Facial expressions have proved difficult to interpret.6 One problem is that some emotions are too complex to be easily represented on our faces. Second, although people can, for the most part, recognise emotions across cultures, this accuracy is worse for cultural groups with less exposure to one another.7 Cultures also have norms that govern emotional expression, so the way we recognise an emotion isn’t always the same as the way we show it. For example, in collectivist countries, where emotional restraint is the norm, people focus more strongly on the eyes, whereas in individualistic countries, where emotional expression is the norm, people focus more strongly on the position of the mouth.8
It’s unlikely that psychologists or philosophers will ever completely agree on a set of basic emotions or even on whether there is such a thing. Still, many researchers agree on six universal emotions: anger, fear, sadness, happiness, disgust and surprise.9 We sometimes mistake happiness for surprise, but rarely do we confuse happiness and disgust.
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What are emotions and moods?
Moral emotions – emotions that have moral implications eg sympathy for suffering, anger about injustice done to others, contempt for unethical behaviour.
Experiencing moods and emotions
Positivity offset: at zero input (when nothing in particular is going on) most individuals experience a mildly positive mood
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Moral emotions
We may tend to think our internal emotions are innate. For instance, if someone jumped out at you from behind a door, wouldn’t you feel surprised? Maybe you would, but you may also feel any of the other five universal emotions—anger, fear, sadness, happiness or disgust—depending on the circumstance. Our experiences of emotions are closely tied to our interpretations of events. Researchers have been furthering this idea by studying moral emotions; that is, emotions that have moral implications because of our instant judgement of the situation that evokes them. Examples of moral emotions include sympathy for the suffering of others, guilt about our own immoral behaviour, anger about injustice done to others and contempt for those who behave unethically.
Research indicates that our responses to moral emotions differ from our responses to other emotions. When we feel moral anger, for instance, we may be more likely to confront the situation that causes it than when we just feel angry. However, we can’t assume our emotional reactions to events on a moral level will be the same as someone else’s. Moral emotions are developed during childhood as children learn moral norms and standards, so moral emotions depend on the situation and normative context more than other emotions. Because morality is a construct that differs from one culture to the next, so do moral emotions. Therefore, we need to be aware of the moral aspects of situations that trigger our emotions and make certain we understand the context before we act, especially in the workplace.
You can think about this research in your own life to see how moral emotions operate. Consider a time when you’ve done something that hurt someone else. Did you feel angry or upset with yourself? Or think about a time when you saw someone else treated unfairly. Did you feel contempt for the person acting unfairly, or did you engage in a cool, rational calculation of the justice of the situation? Most people who think about these situations have some sense of an emotional stirring that might prompt them to engage in ethical actions such as donating money to help others, apologising and attempting to make amends, or intervening on behalf of those who have been mistreated. So we can conclude that people who are behaving ethically are at least partially making decisions based on their emotions and feelings.
Experiencing moods and emotions
The reality is that we all experience moods and emotions differently. For most people, positive moods are somewhat more common than negative moods. Indeed, research finds a positivity offset—meaning that at zero input (when nothing in particular is going on) most individuals experience a mildly positive mood.This appears to be true for employees in a wide range of job settings. For example, one study of customer service representatives in a British call centre revealed that people reported experiencing positive moods 58% of the time despite the stressful environment. Another research finding is that negative emotions lead to negative moods. Perhaps this happens because people think about events that created strong negative emotions five times as long as events that created strong positive ones.
The degree to which people experience positive and negative emotions varies across cultures. This is not because people of various cultures are inherently different: people in most cultures appear to experience certain positive and negative emotions.
The functions of emotions
Do emotions make us irrational? Emotions make our thinking more rational because understanding the situation help guide our behaviour.
Do emotions make us ethical? Moral judgement are largely based on feelings, rather than cognition.
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The function of emotions
In some ways, emotions are a mystery. What function do they serve? As we discussed, OB researchers have found that emotions can be critical to an effectively functioning workplace. For example, a large number of reviews suggest that happy employees tend to have positive job attitudes, to engage in fewer withdrawal and counterproductive work behaviours, to engage in more task and citizenship performance and even to be more successful than their unhappy counterparts. Individuals who tend to experience positive affect consistently as part of their personalities tend to have positive job attitudes, experience good social integration with their supervisor and co-workers, experience good treatment from their organisations and engage in more task and citizenship performance.16 Let’s discuss two critical areas—rationality and ethicality—in which emotions can enhance performance.
Sources of emotions and moods
Personality
Time of the day
Day of the week
Weather (illusory correlation)
Stress
Social activities
Sleep (duration and quality)
Exercise
Age
Gender
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A fascinating study assessed mood by analysing 509 million Twitter messages from 2.4 million individuals across 84 countries. The researchers assessed mood by noting the presence of words connoting positive affect (happy, enthused, excited) and negative affect (sad, angry, anxious). Daily fluctuations in mood tended to follow a similar pattern in most countries, including Australia. Specifically, regardless of the day of the week, positive affect increased after sunrise, tended to peak mid-morning, remained stable until roughly 7 pm and then tended to increase again until the midnight drop. These results are similar to what we reported above from previous research. A major difference, though, was what happens in the evening. As we noted earlier, most research suggests that positive affect tends to drop after 7 pm, whereas this study suggests that it increases before the midnight decline. We’ll have to wait for further research to see which description is accurate. The negative affect trends in this study were more consistent with past research, showing that negative affect is lowest in the morning and tends to increase over the course of the day and evening.
In most cultures people are in their best moods on the weekend: adults tend to experience their highest positive affect on Friday, Saturday and Sunday and their lowest on Monday. As shown in Exhibit 5.2, again based on the study of more than 500 million Twitter messages, that tends to be true in several other cultures as well. For Germans and Chinese, positive affect is highest from Friday to Sunday and lowest on Monday. The same pattern even seems to hold in countries—such as many Muslim countries—where the weekend occurs on different days. This isn’t the case in all cultures, however. As Exhibit 5.2 shows, in Japan, positive affect is higher on Monday than on either Friday or Saturday.
In 2016, the Sleep Health Foundation reported that 33–45% of adults experience inadequate sleep; this included poor sleep duration and quality, as well as daytime consequences. On average, Australians sleep for 7 hours per weekday night, which is below the recommended 8 hours. Medical sleep conditions are also prevalent in Australian society, with 20% of adults reporting significant insomnia and 18% reporting restless leg syndrome. Add to the sleep problems the rising obesity problem, which in turn is rapidly increasing the incidence of obstructive sleep apnoea, and it’s no surprise that people aren’t getting enough sleep.
Sleep quality affects moods and decision making, and increased fatigue puts workers at risk of disease, injury and depression. Poor or reduced sleep also makes it difficult to control emotions. Even one bad night’s sleep makes us angrier and risk-prone, possibly because poor sleep impairs job satisfaction and renders us less able to make ethical judgements.
Do young people experience more extreme positive emotions (so-called youthful exuberance) than older people? Surprisingly, no. Older adults tend to focus on more positive stimuli (and on fewer negative stimuli) than younger adults, a finding confirmed across nearly 100 studies. These older adults tend to self-regulate by actively trying to increase the positivity (and decrease the negativity) in their attention and memory.
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Exhibit 5.2
Source: Based on S. A. Golder and M. W. Macy, ‘Diurnal and seasonal mood vary with work, sleep and day length across diverse cultures’, Science 333, 2011, pp. 1878-81; and A. Elejalde-Ruiz, ‘Seize the day’, Chicago Tribune, 5 September 2012.
Day-of-week mood affects across four cultures
Negative affect – a mood dimension that consists of emotions such as nervousness, stress and anxiety at the high end and relaxation, tranquility and poise at the low end.
‹#›
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Emotional labour
When an employee expresses organisationally desired emotions during interpersonal transactions at work
Emerged from studies of service jobs but is relevant to almost every job
Emotional dissonance – inconsistency between the emotions one feel and the emotions one project.
Felt (actual) vs. displayed emotions
Surface acting and deep acting. Surface acting where one hides inner feelings and emotions in response to display rules. Deep acting where one modifies true inner feelings based on display rules.
Examples
Customer service expected to be cheerful
Effective managers look serious delivering a negative performance evaluation
Look calm when berated by their manager
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https://www.bbc.co.uk/bbcthree/article/5ea9f140-f722-4214-bb57-8b84f9418a7e
Emotional labour means many things to many people. But, put simply, it's when someone feels the need to suppress their own emotions.
The term was first used in 1983, when American sociologist Arlie Hochschild wrote about it in her book, The Managed Heart. At the time, Arlie described emotional labour as having to “induce or suppress feeling in order to sustain the outward countenance that produces the proper state of mind in others”.
In other words, having to keep a fake smile on your face all day - often because you work in a service industry job - regardless of how you're really feeling, because customers, and your boss, might complain if you're anything less than wildly cheer
Research suggests that Western workplaces expect employees to display positive emotions such as happiness and excitement, and suppress negative emotions such as fear, anger, disgust and contempt. Effective managers have learned to look serious when they give an employee a negative performance evaluation, and to look calm when they’re berated by their bosses, because the organisation expects this. Of course, this doesn’t apply to all workplace situations. Does your employer dictate what emotions you display when you are, say, heading out for lunch? Probably not. Many workplaces have explicit display rules, but usually only for interactions that matter, particularly between employees and customers. Although you might expect that the more an employer dictates salespeople’s emotional displays, the higher the sales, employees under very high or very low display rules don’t perform as well in sales situations as employees who have moderate display rules and a high degree of discretion in their roles.Displaying fake emotions requires us to suppress real ones. Surface acting is hiding feelings and emotional expressions in response to display rules—that is, smiling at customers even when you don’t feel like it. Deep acting is trying to modify your true feelings based on display rules. Surface acting deals with displayed emotions, and deep acting deals with felt emotions.
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Affective events theory (AET)
AET proposes that employees react emotionally to things that happen to them at work, and these reactions influence their job performance and satisfaction.
Emotions provide valuable insights into how workplace events influence employee performance and satisfaction.
Employees and managers should not ignore emotions or the events that cause them, even when they appear minor, because they accumulate.
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Affective events theory is an approach to understanding how our emotions impact our work life. At its core, AET integrates a strong emphasis on emotion states and traits as influencing employee attitudes and behaviors.
https://study.com/academy/lesson/affective-events-theory-aet-definition-applications.html
Affective events theory (AET) explains how emotions are central to employees' job satisfaction and job performance. Managers need to understand how workers are impacted emotionally by events at work.
Affective Events Theory
Do your emotions affect how you perform in a work environment? According to the affective events theory (AET), emotions are critically important to how employees handle workplace situations. The model states that there is a relationship between the employees' internal influences (such as emotions) and their reactions to incidents that happen during their workday that affect their performance, job commitment, and long-term job satisfaction.
The theory explains that there are both positive and negative occurrences during the workday that can affect an employee's emotions and job satisfaction. AET is about how the work environment emotionally affects workers and does not take into account any outside influences. For example, if an employee's child is sick at home that would not be part of the AET definition, since it is outside of work.
The theory was developed by organizational psychologists Weiss and Cropanzano. Positive or negative happenings can be anything from being reprimanded for poor work performance to receiving a free cup of coffee for a good performance. All parts of the job can affect emotions, including the actual job tasks, management styles, co-workers' actions, and job pressures. Positive and negative situations at work create long-term emotional responses that can impact job satisfaction, development, and commitment. In order to better understand this theory and its applications, let's take a look at one way the AET performs on the job.
https://www.hrzone.com/hr-glossary/what-is-affective-events-theory-aet
Affective Events Theory (AET) is a psychological model designed to explain the connection between emotions and feelings in the workplace and job performance, job satisfaction and behaviours. AET is underlined by a belief that human beings are emotional and that their behaviour is guided by emotion
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Emotional intelligence
Emotional intelligence (EI) is a person’s ability to read others:
Perceive emotions in yourself and others,
Understand the meaning of these emotions and
Regulate your own emotions accordingly.
Five recommendations to create a healthy and positive workplace environment:
Build an emotion focus into the organisations culture
Understand the emotional impact of jobs on employees
Recruit and terminate on the basis of best fit to the organisation
Design and reward remuneration systems that encourage a positive and friendly emotional culture
Train employees and supervisors in emotional intelligence skills and healthy emotional expression.
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Emotional intelligence refers to one’s ability to “read others.” There are four branches to EI: ability to perceive emotions, ability to assimilate emotions in thought, ability to understand emotions and their effects, and ability to manage emotion in self and others. Emotional labor refers to the emotionally draining process of managing emotion in the service of a job or organization. Five recommendations for engendering a healthy and positive workplace environment:
Build an emotion focus into the organisations culture
Understand the emotional impact of jobs on employees
Recruit and terminate on the basis of best fit to the organisation
Design and reward remuneration systems that encourage a positive and friendly emotional culture
Train employees and supervisors in emotional intelligence skills and healthy emotional expression.
Only recently has the link between emotions and behaviour been recognised for both positive and negative outcomes in the workplace. Emotions, mood and affect can be spread in the workplace. This capacity to spread is termed emotional contagion. Emotional contagion can be a spill over from inside and outside the workplace. Spill over from a personal or family situation, external to the workplace, could be brought into the work environment. Emotions experienced in the workplace can originate from home, school, work and social situations.
All emotions are important. Displayed – emotions that are visible. Felt – What the employee feels. At work it is assumed people have two sets of emotions: one set of emotions that are displayed in the outer world and one set of emotions that are actually felt internally. How often have you heard someone say: Oh, you’re just being emotional … You might have been offended.
Moods and emotions have a trait component, most people have built in tendencies to experience certain moods more frequently than others do. People also experience the same emotions with different intensities.
Emotional Intelligence
Is the capacity to be:
aware of one’s own emotions and the emotions of others
manage emotions
and respond to emotions in an appropriate way
the ability to detect and to manage emotional cues and information
One study estimates that 90% of the top performers have high emotional intelligence. Several studies that EI play an important role in job performance. EI has been a controversial concept in OB, with supporters and detractors. Emotional intelligence differs from traditional or cognitive intelligence. Traditional intelligence accounts for only a small percentage of success in an organisation. Organisations have recognised the connection between emotional intelligence and leadership; and emotional intelligence and job performance.
Emotional intelligence involves being able to recognise and respond to social and emotional situations. EI as a competency can be developed and changed. Levels of emotional intelligence can differ across individuals. High levels of EI have been found to be predictive of high performance in many studies. Organisations have recognised the connection between EI and leadership and EI and job performance.
Emotions and moods are similar in that both are affective in nature; however, they’re also different—moods are more general and less contextual than emotions. In addition, events, temporal factors, stress-causing events and sleep patterns are some of the factors that influence emotions and moods. Emotions and moods have proven relevant for virtually every OB topic we study.
Emotions and positive moods appear to facilitate effective decision making and creativity. To foster effective decision making, creativity and motivation in employees, model positive emotions and moods as much as is authentically possible. Provide positive feedback to increase the positivity of employees. In the service sector, encourage positive displays of emotion, which make customers feel more positive and thus improve customer service interactions and negotiations.
Regulate your intense emotional responses to an event by recognising the legitimacy of the emotion and being careful to vent only to a supportive listener who isn’t involved in the event. Be careful not to ignore co-workers’ and employees’ emotions; don’t assess others’ behaviour as if it were completely rational. As one consultant aptly put it, ‘You can’t divorce emotions from the workplace because you can’t divorce emotions from people.’
Managers who understand the role of emotions and moods will significantly improve their ability to explain and predict their co-workers’ and employees’ behaviour.
An elaboration of some of Gardner’s ideas was made by Goleman64 who agreed that the classic view of intelligence was too narrow. He felt that the emotional qualities of indi- viduals should be considered. These, he felt, played a vital role in the application of intelligence in everyday life. He identified the key characteristics as:
abilities such as being able to motivate oneself and persist in the face of frustrations; to control impulse and delay gratification; to regulate one’s moods and keep distress from swamping the ability to think; to emphasise and to hope.
Emotional intelligence has received considerable attention over the last few years as the concept has been identified as a key aspect of managing people effectively. Goleman suggests that emotional intelligence or EI predicts top performance and accounts for more than 85 per cent of outstanding performance in top leaders. The Hay Group working with Goleman have identified 18 specific competencies that make up the four components of emotional intelligence and have produced an inventory designed to measure Emotional Competence. The Emotional Competence Inventory defines EI as: ‘The capacity for recognising our own feelings and those of others, for motivating ourselves and for managing emotions within our- selves and with others.’
An elaboration of some of Gardner’s ideas was made by Goleman who agreed that the classic view of intelligence was too narrow. He felt that the emotional qualities of individuals should be considered. These, he felt, played a vital role in the application of intelligence in everyday life. He identified the key characteristics as:
abilities such as being able to motivate oneself and persist in the face of frustrations; to control impulse and delay gratification; to regulate one’s moods and keep distress from swamping the ability to think; to emphasise and to hope.
Emotional intelligence has received considerable attention over the last few years as the concept has been identified as a key aspect of managing people effectively. Goleman suggests that emotional intelligence or EI predicts top performance and accounts for more than 85 per cent of outstanding performance in top leaders. The Hay Group working with Goleman have identified 18 specific competencies that make up the four components of emotional intelligence and have produced an inventory designed to measure Emotional Competence The Emotional Competence Inventory defines EI as: ‘The capacity for recognising our own feelings and those of others, for motivating ourselves and for managing emotions within our- selves and with others.
Exhibit 5.3
A cascading model of emotional intelligence
Source: Based on D. L. Joseph and D. A. Newman, ‘Emotional intelligence: an integrative meta-analysis and cascading model’, Journal of Applied Psychology 95, no. 1, 2010, pp. 54-78.
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Emotional intelligence (EI) is a person’s ability to (1) perceive emotions in yourself and others, (2) understand the meaning of these emotions and (3) regulate your own emotions accordingly, as you can see in Exhibit 5.3. People who know their own emotions and are good at reading emotional cues—for instance, knowing why they’re angry and how to express themselves without violating norms—are most likely to be effective.
Several studies suggest that EI plays an important role in job performance, although the survey items are often strikingly similar to items from personality, intelligence and self-perception tests. Other reviews suggest that EI is related to teamwork effectiveness as well as deviant and citizenship behaviour. South Korean managers with high EI tend to have better sales figures than those with low EI because they are able to create more cohesive stores and improved sales-directed behaviour. EI is also attracting positive attention in the political arena. For example, when asked in a television interview how he would relate to everyday Australians despite being extremely wealthy, then Australian Prime Minister Malcolm Turnbull stated, ‘The important thing is to have the emotional intelligence and the empathy and the imagination that enables you to walk in somebody else’s shoes . . . Emotional intelligence is probably the most important asset for—certainly for anyone in my line of work.
Although the field is progressing in its understanding of EI, many questions haven’t been answered. One relates to a better understanding of EI. For example, we need to be precise when we talk about EI. Are we referring to EI in general? Or to regulating emotions, understanding emotions or perceiving emotions specifically? A second question is about the reliability of EI testing. For example, part of the reason EI has only a modest correlation with job effectiveness is that it’s hard to measure—mostly it’s measured with self-report inventories, which, of course, are often far from objective!
All questions aside, EI is wildly popular among consulting firms and in the popular press, and it has accumulated some support in the research literature. Love it or hate it, one thing is for sure: EI is here to stay. Our next topic, emotion regulation, is also being increasingly studied as an independent concept.
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Emotion regulation
Emotion regulation influences and outcomes
Diversity in work groups increases the likelihood that you will regulate your emotions
The downside to emotion regulation
Emotion regulation techniques
Emotional suppression
Cognitive reappraisal
Social sharing/venting
Mindfulness
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This is a good article to read and understand emotion regulation. Please read. http://selfinjury.bctr.cornell.edu/perch/resources/what-is-emotion-regulationsinfo-brief.pdf
Emotion regulation
Ethics of emotion regulation
Controlling your emotions might seem unethical to some because it requires a degree of acting.
Some might argue that all emotions should be controlled to take a dispassionate perspective.
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OB applications of emotions and moods
Deviant workplace behaviours
Safety and injury at work
Selection
Decision making
Creativity
Motivation
Leadership
Negotiation
Customer service
Work–life balance
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Selection
One implication from the evidence on EI to date is that employers should consider it a factor in hiring employees, especially for jobs that demand a high degree of social interaction. In fact, more employers are starting to use EI measures to hire people, and even to select students for positions in university courses. In an Australian first, Bond University included emotional intelligence testing in its selection process for medical students, in addition to their high-school results. According to Dean of Medicine Kirsty Forrest, ‘While some people called it “naval gazing”, [EI] skills ... are critical to a medical career’.
Decision making
Moods and emotions have effects on decision making that managers should understand. Positive emotions and moods seem to help people make sound decisions. Positive emotions also enhance problem-solving skills, so positive people find better solutions.
OB researchers continue to debate the role of negative emotions and moods in decision making. One recent study suggested that people who are saddened by events may make the same decisions as before, while people who are angered by events might make stronger (though not necessarily better) choices than before. Another study found that participants made choices reflecting more originality in a negative mood. Still other research indicated that individuals in a negative mood may take higher risks than they do when in a positive mood.94 Taken together, these and other studies suggest negative (and positive) emotions affect decision making but that there are other variables that require further research.
Creativity
As we’ll see throughout this book, one goal of leadership is to maximise employee productivity through creativity. Creativity is influenced by emotions and moods, but there are two schools of thought on the relationship. Much research suggests that people in good moods tend to be more creative than people in bad moods. People in good moods produce more ideas and more options, and others think their ideas are original. It seems that people experiencing positive moods or emotions are more flexible and open in their thinking, which may explain why they’re more creative. Supervisors should actively try to keep employees happy because doing so creates more good moods (employees like their leaders to encourage them and provide positive feedback on a job well done), which in turn leads people to be more creative.
Some researchers, however, don’t believe a positive mood makes people more creative. They argue that, when people are in positive moods, they may relax (‘If I’m in a good mood, things must be going okay, and I don’t need to think of new ideas’) and not engage in the critical thinking necessary for some forms of creativity. Individuals who worry more may perform better on creative tasks than those who worry less.
Motivation
Several studies have highlighted the importance of moods and emotions for motivation. One study set involved two groups of people being asked to solve word puzzles. The first group saw a funny video clip intended to put them in a good mood first. The other group wasn’t shown the clip and started working on the puzzles straight away. The results? The positive-mood group (which saw the video clip beforehand) reported higher expectations of being able to solve the puzzles, worked harder at them and did solve more as a result.
Another study looked at the moods of insurance sales agents in Taiwan.102 Agents in a good mood were found to be more helpful towards their co-workers and also felt better about themselves. These factors in turn led to superior performance in the form of higher sales and better supervisor reports of performance.
Giving people performance feedback—whether real or fake—influences their mood, which then influences their motivation. A cycle can be created in which positive moods cause people to be more creative, leading to positive feedback from those observing their work. The feedback further reinforces the positive mood, which makes people perform even better, and so on. Overall, the findings suggest a manager may enhance employee motivation—and performance—by encouraging good moods.
Leadership
Research indicates that putting people in a good mood makes sense. Leaders who focus on inspirational goals generate greater optimism, cooperation and enthusiasm in employees, leading to more positive social interactions with co-workers and customers. A study with Taiwanese military participants indicates that, by sharing emotions, transformational leaders inspire positive emotions in their followers, which in turn leads to higher task performance.
Leaders are perceived as more effective when they share positive emotions, and followers are more creative in a positive emotional environment. What about when leaders are sad? Research found that leader displays of sadness increased the analytic performance of followers, perhaps because followers attended more closely to tasks to help the leaders.
Corporate executives know emotional content is critical for employees to buy into their vision of the company’s future and accept change. When managers offer new visions, especially with vague or distant goals, it’s often difficult for employees to accept the changes they will bring. By arousing emotions and linking them to an appealing vision, leaders may help managers and employees alike to accept change and feel connected to the new plan.
Negotiation
Have you considered the potential of using emotions and moods to enhance your negotiation skills? Several studies have shown that negotiators who feign anger have an advantage over their opponents because when negotiators show anger, their opponents conclude they have conceded all they can, and so give in. However, anger should be used selectively in negotiation: angry negotiators who have less information or less power than their opponents have significantly worse outcomes.
As in the use of any emotion, context matters. Displaying a negative emotion (such as anger) can be effective, but feeling bad about your performance appears to impair future negotiations. Individuals who do poorly in negotiation experience negative emotions, develop negative perceptions of their counterparts and are less willing to share information or be cooperative in future negotiations.
Altogether, the best negotiators are probably those who remain emotionally detached. One study of people who suffered damage to the emotional centres of their brains suggested that unemotional people may be the best negotiators because they’re not likely to overcorrect when faced with negative outcomes.
Customer service
Workers’ emotional states influence the level of customer service they give, which in turn influences levels of repeat business and customer satisfaction. Employees’ emotions can transfer to the customer. This result is primarily due to emotional contagion—the ‘catching’ of emotions from others. When someone experiences positive emotions and laughs and smiles at you, you tend to respond positively. Of course, the opposite is true as well.
Emotional contagion - The process by which people’s emotions are caused by the emotions of others.
Studies indicate a matching effect between employee and customer emotions. In the employee-to-customer direction, research finds that customers who catch the positive moods or emotions of employees shop longer. In the other direction, when an employee feels unfairly treated by a customer, it’s harder for them to display the positive emotions their organisation expects. High-quality customer service makes demands on employees because it often puts them in a state of emotional dissonance, which can be damaging to the employee and the organisation. Managers can interrupt negative contagion by fostering positive moods.
Work–life balance
There’s good news and bad news about the relationship between moods and work–life balance: both are affected by work and home events. The advice, ‘Never take your work home with you’—meaning you should forget about work once you go home—is easier said than done. The good news is that a positive mood at work can apparently spill over to your off-work hours, and a negative mood at work can be restored to a positive mood after a break. Several studies have shown that people who had a good day at work tend to be in a better mood at home that evening, and vice versa. Other research has found that, although people do emotionally take their work home with them, by the next day the effect is usually gone. The bad news is that the moods of other people may interfere with yours. As you might expect, one study found that if one member of a couple was in a negative mood during the workday, the negative mood spilled over to the spouse at night.
Deviant workplace behaviours
Anyone who has worked in an organisation will know that people can behave in ways that violate established norms and threaten the organisation, its members or both. These actions are called counterproductive work behaviours (CWBs). They can be traced to negative emotions and can take many forms. People who experience negative emotions are more likely than others to engage in short-term deviant behaviour at work, such as gossiping or excessively surfing the Internet instead of working, although negative emotions can also lead to more serious forms of CWB.
For instance, envy can come from resenting someone for having something you don’t have but strongly desire—such as a better work assignment, larger office or higher salary. It can lead to malicious deviant behaviours. An envious employee could backstab another employee, negatively distort others’ successes and positively distort their own accomplishments. Angry people look for other people to blame for their bad mood, interpret other people’s behaviour as hostile and have trouble considering others’ points of view. It’s not hard to see how these thought processes, too, can lead directly to verbal or physical aggression.
Safety and injury at work
Research relating negative affectivity to increased injuries at work suggests employers might improve health and safety (and reduce costs) by ensuring workers aren’t engaged in potentially dangerous activities when they’re in a bad mood. Bad moods can contribute to injury at work in several ways. Individuals who are in a negative mood tend to be more anxious, which can make them less able to cope effectively with hazards. A person who is always fearful will be more pessimistic about the effectiveness of safety precautions because they feel they will get hurt anyway, or they might panic or freeze up when confronted with a threatening situation. Negative moods also make people more easily distracted, and distractions can obviously lead to careless behaviours.
Selecting positive team members can contribute towards a positive work environment because positive moods transmit from team member to team member. One study of 130 leaders and their followers found that leaders who are charismatic transfer their positive emotions to their followers via a contagion effect. It makes sense, then, to choose team members predisposed to positive moods.
Summary
Emotions and moods are both affective in nature, but moods are more general and less contextual than emotions.
OB research on emotional labour, affective events theory, emotional intelligence and emotion regulation helps us understand how people deal with emotions.
Emotions and moods are relevant for virtually ever OB topic we study, with implications for managerial practices
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Emotions and moods are similar because both are affective in nature. But they’re also different: moods are more general and less contextual than emotions. The time of day, stressful events and sleep patterns are some of the factors that influence emotions and moods. OB research on emotional labour, affective events theory, emotional intelligence and emotion regulation helps us understand how people deal with emotions. Emotions and moods have proven relevant for virtually every OB topic we study, with implications for managerial practices.
Implications for managers
Recognise that emotions are a natural part of the workplace, and good management doesn’t mean creating an emotion-free environment.
To foster effective decision making, creativity and motivation in employees, model positive emotions and moods as much as is authentically possible.
Provide positive feedback to increase the positivity of employees. Of course, it also helps to hire people who are predisposed to positive moods.
In the service sector, encourage positive displays of emotion, which make customers feel more positive and improve customer-service interactions and negotiations.
Understand the role of emotions and moods to significantly improve your ability to explain and predict your colleagues’ and others’ behaviour.
18
Topic 6
Perception and individual decision making
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19
Perception is the ability to see, hear, or become aware of something through the lenses.
Your perception of something is the way that you think about it or the impression you have of it. Someone who has a perception recognises or notices things that are not obvious. Perception is the process of taking in, interpreting, and taking actions based on information that is obtained from the environment. Perceptions are important because they determine what constitutes reality for individuals – information is filtered through frameworks based upon knowledge and past experience.
The process of perception provides important considerations for understanding organisational behaviour. Although limitations and biases in the perceptual processes can help people in organisations make decisions. Perceptual shortcuts occur often in contemporary organisations where novelty and information often threaten to overload decision making. Because of the biases that perceptual processes create, the perceptual process is by nature limited. The perceptual process can be managed more effectively through the use of critical reflection.
Understanding critical reflection: What is the starting point for managing the perceptual process. Researchers Fooke & Gardner present a process that encourages people in the workplace to think and reflect more deeply on perceptions and how these perceptions may be distorted. The starting point for managing the perceptual process is questioning the assumptions that went into the initial observations. This process is called critical reflection, or the analysis of the validity of your assumptions, knowledge, understanding and beliefs. The process involves four stages: applying critical reflection to organisational actions encourages perceptual distortion and minimizes bias in important HR decisions such as recruitment, performance management, leadership selection and decision making. Critical reflection is a process that encourages people in the workplace to think and reflect more deeply on perceptions and how these perceptions may be distorted. This is offered as a four-stage process.
Perception involves selecting a subset of sensory information. By selecting and processing only a limited amount of information, what is perceived as reality also becomes limited. Individuals differ in how they filter information, what information they pay attention to, and how they prioritize the significance of information. Perception begins with the particular characteristics of the perceiver. Experience, knowledge base, values, emotions, motivation, and even personality of the perceiver shape what information is recognized and how that information is prioritized, organized, interpreted, and acted upon. The process by which people perceive has limitations. So much information and stimuli exist n your environment that you cannot possibly recognize and sort through it all. In order to overcome this limitation, people select and retrieve small bits of information. The information is then organized and interpreted. People then make sense of the information by identifying or creating patterns, even when no actual pattern exists.
Selective perception describes the process where information and its recall becomes consistent with people’s values and experiences. Hindsight bias occurs when an individual perceives that the likelihood of an event has increased after the fact. Stereotyping occurs when you show preference to a group that shares the same characteristics. The halo effect occurs when a person has one positive characteristic and this affects all other perceptions of the person. The horns effect occurs when a person has one negative characteristic and this affects all other perceptions of the process. Self-fulfilling prophecy occurs when someone's expectations influence another person to act consistently with those expectations.
The process of attribution describes how blame or credit is attributed to someone for an event, whether or not they had anything to do with it. Attribution occurs at the intrapersonal level where you might blame or credit yourself, at the interpersonal level where blame or credit is attributed to another person, at the intergroup level which means you attribute responsibility to another work group, and at the organisational level when members in the organization assign credit or blame to the organisation.
There are three categories that determine internal or external attribution. Consensus occurs when behavior is analyzed as being just like other people’s behavior in the same situation or different than other people’s behavior. Distinctiveness occurs when behavior is analyzed as occurring in other situations or seldom occurring in other situations, and consistency occurs when the behavior is analyzed as being similar or dissimilar over time.
There are a variety of individual and organisational applications for perception. Bias can play a part in human resources’ decisions including promotions, performance appraisals, flexible work practices, salary, recruitment and selection, and terminations.
Decision making is a conscious process of making choices among alternatives with the intention of moving towards some desired state of affairs.
The four approaches to decision making in organisations – rational, behaviour economics, organisational psychology and naturalistic – illustrate the benefits and limitations with decision making. Many decisions are good in theory, but when put into practice, prove less than satisfactory. Emerging considerations of the decision making approach focuses on understanding how decision are made and the relationship between actual decision making and the ultimate success of the decision and the condition or types of organisations under which these decisions are made.
Decision making describes how individuals and organizations choose among different alternatives and identify the best solution to a problem. Organizations face two types of decisions: programmed and non-programmed. Programmed decisions are characterized by routine decision-making situations where actions have clearly identifiable and often predictable outcomes. Organisations engage in programmed decisions on a regular basis and have established procedures and metrics for decision making. Non-programmed decisions require new methods and procedures often involving highly complex and non-routine problems. In non-programmed decision making, the relationship between decisions and their expected outcomes remain unclear. While many decisions in organisations involve programmed decisions like determining budgets, recruiting employees and production decisions; based on established procedures and metrics for decision-making. A number of decisions in organisations are non-programmed. For example, forecasting future income streams, establishing strategy, and dealing with changing customer demands have become non-programmed decisions in many organisations.
Rational decision making is the systematic weighing of options to maximize desired outcomes by estimating the probabilities of various outcomes. Rational decision making emphasizes the systematic gathering and processing of information to improve the quality of the decision. This six-step process involves the following:
Identify the problem or opportunity – clearly state the problem to be solved
Identify criteria of decision - determine what outcomes are being sought and identify measures that will determine success
Identify alternatives - identify alternative courses of action
Allocate weights – allocate weights to each alternative
Evaluate alternatives – evaluate each alternative
Select best alternatives – select the best among the choices
Problem framing explains the way a situation is framed, or presented, will impact the choices made by decision makers.
Behavioral economic-based decision making focuses on how incentives and psychological biases may interfere with rational decision making and cause decision makers to make less than optimal decisions. The behavioral economic-based decision-making approach offers a response to the limitation of the rationalist approach to decision making. The approach is designed to explain how people deviate from rational decision making. Part of this model discusses the mental tricks that individuals perform when faced with difficult choices. This is called mental accounting to refer to the mental tricks that individuals employ when making financial and business decisions. Another important issue to be aware of is the issue of problem framing. This explains how a situation is framed or presented and how this may impact the choices made by the decision maker.
Research has demonstrated a number of shortcuts decision makers use in the decision-making process. These are referred to as heuristics. Some of the more common heuristics are the following:
Overconfidence: Describes the situation when an individual has a higher assessment of a positive outcome in a situation than is warranted by reading facts.
Anchoring: Occurs when the decision maker relies too heavily on one single characteristic of a decision rather than equally weighing others.
Confirmation: Describes how individuals seek information that confirms their beliefs.
Gambler: This fallacy states that in many cases, individuals believe that luck is on their side rather than recognizing the randomness of events.
Availability: Describes how individuals seek out readily accessible information when making a decision rather than seeking information that may be difficult or expensive.
Hindsight: This occurs when a person changes their viewpoint, opinion, or reassesses a situation based on new information.
Learning Objectives
Evaluate the links between perception and decision making
Contrast the rational model of decision making with bounded rationality and intuition
Contrast the three ethical decision criteria
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Introduction
The creativity of individuals can lead to true innovation that solves problems and allows companies to become market leaders.
To better understand this, we’ll explore perceptions and how they affect our decision-making processes
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https://courses.lumenlearning.com/wm-organizationalbehavior/chapter/creativity-in-decision-making/
Creativity in Decision Making
Discuss ways to promote creativity in decision making
If a decision maker is going to produce novel alternatives when solving a problem, then he or she is going to need a little creativity to help the process along. Creativity allows the decision maker to more fully appraise and understand the problem . . . sometimes in ways others can’t see it.
Creativity is the ability to link or combine ideas in novel ways, and their unique alternatives have to be considered useful to others. Creativity is also known as divergent or lateral thinking. Lateral thinking moves away from the linear approach that’s advocated in rational decision making. Some researchers feel that employee and manager creativity is the hallmark of an organization’s success—that solving old organizational issues in new ways creates organizational effectiveness.
If creativity is the key to organizational effectiveness, then how do we get some of that? Is there a way that organizations can foster creativity for the benefit of decision making?
First, it’s important to note the characteristics of creative people, so we can understand what we’re aiming for in our creative environment. Creative decision makers seem to have an ability to sift through the massive amounts of information that can be reviewed when making a decision, and decide what information is and isn’t relevant. Still, they listen to all sources to understand where problems are emerging. And when they’re ready, they present a solution that’s bold and well informed. They don’t rely on the rational decision making model . . . they rely on something more than that. Creativity.
Four characteristics that creative leaders seem to have in common:
Perseverance in the face of obstacles and adversity
Willingness to take risks
Willingness to grow and openness to experience
Tolerance of ambiguity
Effective use of analogy to apply a known situation to an unknown situation
Organizationally (and individually) speaking, there are certain factors that, when they exist, tend to point to a more creative atmosphere.
Questioning attitude. Organizations that don’t invite the questioning of values, assumptions or norms are not likely to be very creative. Organizations need to continually question the long-held beliefs of their industry if they’re going to stay ahead of the curve and come up with creative ways to bring services and products to their customers.
Culture. Our traditional values are sometimes at odds with the creative solutions we might come up with to solve organizational problems. If an organization’s culture puts too much emphasis on tradition, they’re likely to stifle creativity around problem solving.
Leadership. Similar to culture, leaders who are bound to traditional characteristics of the leader-follower relationship, who don’t promote questioning attitudes or invite their employees to challenge the status quo, will not do much to foster a creative environment.
Attitude toward risk. Finally, employees who are afraid to try something new will never put their creative solutions into action! Just as one of the characteristics of a creative leader is a willingness to take risks, so must employees feel comfortable doing so in an organization.
Overall, creativity is likely to flourish in an environment that’s open and encourages participation. Keeping everyone on an even playing field, with no organizational encouragement for an “us versus them” type of environment will increase dialogue and keep ideas flowing.
What is perception?
Perception is a process by which individuals organise and interpret their sensory impressions in order to give meaning to their environment.
Factors that influence perception
Factors in the perceiver
Factors in the object or target being perceived
Factors in the context of the situation in which the perception is made
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The process of perception links individuals to their social world. Although we all see the world through our own ‘coloured spectacles’ we also have the opportunities to share our experiences with others. By learning others’ perspectives and by widening our under- standing of how others may see the world, depth and variety is encouraged and problems of bias and distortion become minimised. Perception is the root of all organisational behaviour and any situation can be analysed in terms of its perceptual connotations.
■ For managers, an understanding of perception is essential to ensure that they are aware of the problems which can arise from the process of perceptual attention and selectivity. The process of perception is innately organised and patterned in order to provide meaning for the individual. The process of perception is based on both internal and external factors. The organisation and arrangement of stimuli is influenced by three important factors: figure and ground; grouping; and closure. It is important to be aware of potential perceptual illusions.
■ Part of the process of perceiving other people is to attribute characteristics to them. We judge their behaviour and intentions on past knowledge and in comparison with other people we know. Perception gives rise to individual behavioural responses in given situations. The principles of perceptual differences reflect the way we perceive other people and are the source of many organisational problems. In the work situation, the process of perception and selection of stimuli can influence a manager’s relationship with other staff.
It is difficult to consider the process of interpersonal perception without commenting on how people communicate. Communication and perception are inextricably bound. How we communicate to our colleagues, boss, subordinates, friends and partners will depend on our perception of them, on our ‘history’ with them, on their emotional state, etc. We may misjudge them and regard our communication as unsuccessful, but unless we have some feedback from the other party we may never know whether what we have said, or done, was received in the way it was intended. Feedback is a vital ingredient of the communication process. The feedback may reaffirm our perceptions of the person or it may force us to review our perceptions. In our dealings with more
Exhibit 6.1
Factors that influence perception
Factors that influence perception
/object being perceived
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When you look at a target and attempt to interpret what you see, your interpretation is heavily influenced by your personal characteristics. Characteristics that affect perception include your attitudes, personality, motives, interests, past experiences and expectations. For instance, if you expect police officers to be authoritative, young people to be lazy or politicians to be untrustworthy, you may always perceive them as this, regardless of their actual traits. In some ways, we hear what we want to hear1 and we see what we want to see—not because it’s the truth, but because it conforms to our thinking.
The characteristics of the observed target can affect what we perceive. Loud people are more likely to be noticed in a group than quiet ones. So, too, are extremely attractive or unattractive individuals. Because we don’t look at targets in isolation, the relationship of a target to its background also influences perception, as does our tendency to group close things and similar things together. For instance, we often perceive women, men, Indigenous Australians, Asians or members of any other group that has clearly distinguishable characteristics to be alike and similar in other, unrelated ways as well.
Context is also important. The actual time of day or night when we see an object or event can influence our attention, as can location, light, heat or any number of situational factors. At a nightclub on a Saturday night, you might not notice a young patron dressed in the latest designer fashion. Yet if that same person wore the same clothes and attended your Monday morning management theory class it would certainly catch everyone’s attention. Neither the perceiver nor the target has changed between Saturday night and Monday morning, but the situation is different. Let’s next consider how we make perceptions of others.
23
Person perception: making judgements about others
Attribution theory
Tries to explain the ways in which we judge people differently, depending on the meaning we attribute to a given behaviour.
This determination depends largely on three factors:
Distinctiveness: display different behaviour in different situations
Consensus: everyone display same behaviour in a given similar situation
Consistency: respond the same way over time
Internal (within one’s control) vs. external causation eg. I’m late because…
Fundamental attribution error
Self-serving bias – tendency to attribute own successes to internal factors (own effort, ability), put the blame for failures on external factors (bad luck, unproductive colleagues)
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https://www.instructionaldesign.org/theories/attribution-theory/
Attribution theory is concerned with how individuals interpret events and how this relates to their thinking and behavior. Heider (1958) was the first to propose a psychological theory of attribution, but Weiner and colleagues (e.g., Jones et al, 1972; Weiner, 1974, 1986) developed a theoretical framework that has become a major research paradigm of social psychology. Attribution theory assumes that people try to determine why people do what they do, i.e., attribute causes to behavior. A person seeking to understand why another person did something may attribute one or more causes to that behavior. A three-stage process underlies an attribution: (1) the person must perceive or observe the behavior, (2) then the person must believe that the behavior was intentionally performed, and (3) then the person must determine if they believe the other person was forced to perform the behavior (in which case the cause is attributed to the situation) or not (in which case the cause is attributed to the other person).
Weiner focused his attribution theory on achievement (Weiner, 1974). He identified ability, effort, task difficulty, and luck as the most important factors affecting attributions for achievement. Attributions are classified along three causal dimensions: locus of control, stability, and controllability. The locus of control dimension has two poles: internal versus external locus of control. The stability dimension captures whether causes change over time or not. For instance, ability can be classified as a stable, internal cause, and effort classified as unstable and internal. Controllability contrasts causes one can control, such as skill/efficacy, from causes one cannot control, such as aptitude, mood, others’ actions, and luck.
Attribution theory is closely associated with the concept of motivation. It also relates the work done on script theory and inferencing done by Schank.
Application
Weiner’s theory has been widely applied in education, law, clinical psychology, and the mental health domain. There is a strong relationship between self-concept and achievement. Weiner (1980) states: “Causal attributions determine affective reactions to success and failure. For example, one is not likely to experience pride in success, or feelings of competence, when receiving an ‘A’ from a teacher who gives only that grade, or when defeating a tennis player who always loses…On the other hand, an ‘A’ from a teacher who gives few high grades or a victory over a highly rated tennis player following a great deal of practice generates great positive affect.” (p.362). Students with higher ratings of self-esteem and with higher school achievement tend to attribute success to internal, stable, uncontrollable factors such as ability, while they contribute failure to either internal, unstable, controllable factors such as effort, or external, uncontrollable factors such as task difficulty. For example, students who experience repeated failures in reading are likely to see themselves as being less competent in reading. This self-perception of reading ability reflects itself in children’s expectations of success on reading tasks and reasoning of success or failure of reading. Similarly, students with learning disabilities seem less likely than non-disabled peers to attribute failure to effort, an unstable, controllable factor, and more likely to attribute failure to ability, a stable, uncontrollable factor.
Lewis & Daltroy (1990) discuss applications of attribution theory to health care. An interesting example of attribution theory applied to career development is provided by Daly (1996) who examined the attributions that employees held as to why they failed to receive promotions.
Example
Attribution theory has been used to explain the difference in motivation between high and low achievers. According to attribution theory, high achievers will approach rather than avoid tasks related to succeeding because they believe success is due to high ability and effort which they are confident of. Failure is thought to be caused by bad luck or a poor exam, i.e. not their fault. Thus, failure doesn’t affect their self-esteem but success builds pride and confidence. On the other hand, low achievers avoid success-related chores because they tend to (a) doubt their ability and/or (b) assume success is related to luck or to “who you know” or to other factors beyond their control. Thus, even when successful, it isn’t as rewarding to the low achiever because he/she doesn’t feel responsible, i.e., it doesn’t increase his/her pride and confidence.
Principles
Attribution is a three stage process: (1) behaviour is observed, (2) behaviour is determined to be deliberate, and (3) behaviour is attributed to internal or external causes.
Achievement can be attributed to (1) effort, (2) ability, (3) level of task difficulty, or (4) luck.
Causal dimensions of behaviour are (1) locus of control, (2) stability, and (3) controllability.
Exhibit 6.2
Attribution theory
Example
(1) John performs at about the same level on other related tasks as on this current task (low distinctiveness)
(2) Other employees frequently perform differently than Kim on this current task (low consensus)
(3) John’s performance on this current task is consistent over time (high consistency)
Attribution: the primary responsibility for John’s task performance is Internal.
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Inanimate objects, such as desks, machines and buildings, are subject to the laws of nature, but they have no beliefs, motives or intentions. People do. That’s why when we observe people, we attempt to explain why they behave in certain ways. Our perception and judgement of a person’s actions will therefore be significantly influenced by the assumptions we make about that person’s internal state.
Attribution theory tries to explain the ways in which we judge people differently, depending on the meaning we attribute to a given behaviour.3 It suggests that when we observe an individual’s behaviour, we attempt to determine whether it was internally or externally caused. That determination, however, depends largely on three factors: (1) distinctiveness, (2) consensus and (3) consistency. First, let’s clarify the differences between internal and external causation and then we’ll elaborate on each of the three determining factors.
Attribution theory - An attempt to determine whether an individual’s behaviour is internally or externally caused.
Internally caused behaviour is what we believe to be under the personal control of the individual. Externally caused behaviour is what we imagine the situation forced the individual to do. If one of your employees is late for work, you might attribute that to their partying until 3 am and then oversleeping. This is an internal attribution. But if you attribute their arriving late to a car accident that caused a traffic jam, you are making an external attribution.
Now let’s discuss each of the three determining factors. ‘Distinctiveness’ refers to whether an individual displays different behaviours in different situations. Is the employee who arrives late today also the one that colleagues say regularly avoids or shirks commitments? What we want to know is whether this behaviour is unusual. If it is, we’re likely to give it an external attribution. If it’s not, we’ll probably judge the behaviour to be internal.
If everyone who faces a similar situation responds in the same way, we can say the behaviour shows consensus. The behaviour of our tardy employee meets this criterion if all employees who took the same route to work were also late. From an attribution perspective, if consensus is high, you would probably give an external attribution to the employee’s tardiness, whereas if other employees who took the same route made it to work on time, you would probably attribute the employee’s lateness to an internal cause.
Finally, an observer looks for consistency in a person’s actions. Does the person respond the same way over time? Arriving 10 minutes late for work is not perceived in the same way for an employee who hasn’t been late for several months as it is for an employee who is late two or three times a week. The more consistent the behaviour, the more we’re inclined to attribute it to internal causes.
Exhibit 6.2 summarises the key elements in attribution theory. Let’s consider an employee, Kim. The exhibit tells us, for instance, (1) that if Kim generally performs at about the same level on other related tasks as she does on her current task (low distinctiveness) and (2) that if other employees frequently perform differently—better or worse—than Kim does on this current task (low consensus) and (3) that if Kim’s performance on this current task is consistent over time (high consistency), then anyone judging her work will probably hold her primarily responsible for her task performance (internal attribution).
25
Common shortcuts in judging others
Selective perception
we make selections based on our interests, background, experience and attitudes. See what we want to see, sometimes draw unwarranted conclusions from an ambiguous situation.
Halo and horns effects
Halo: Draw impression on the basis of a single characteristic, eg intelligence, sociability or appearance.
Horn: draw a negative impression from a single characteristic.
Contrast effects
Evaluate a person’s characteristics that is affected by comparison with other people recently encountered who rank higher or lower on the same characteristic.
Stereotyping
Judge someone based on our perception of the group they belong to.
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Selective perception
Any characteristic that makes a person, an object or an event stand out will increase the probability that we’ll perceive it because it’s impossible for us to assimilate everything we see—we can only take in certain stimuli. This tendency explains why you’re more likely to notice cars like your own or why a boss may reprimand some people and not others who are doing the same thing. Because we can’t observe everything going on around us, we engage in selective perception. But we don’t choose randomly—we make selections based on our interests, background, experience and attitudes. By seeing what we want to see, we sometimes draw unwarranted conclusions from an ambiguous situation.
Selective perception - the tendency to selectively interpret what you see on the basis of your interests, background, experience and attitudes.
Halo and horns effects
When we draw a general impression about an individual on the basis of a single characteristic, such as intelligence, sociability or appearance, a halo effect is operating.If you’re a critic of the current prime minister or opposition leader, try listing ten things you admire about them. If you’re an admirer, try listing ten things you dislike about them. No matter which alternative describes you, odds are you won’t find this an easy exercise! That’s the halo effect: our general views contaminate our specific ones. The horns effect, on the other hand, is when we draw a negative impression from a single characteristic.
Halo effect - the tendency to draw a general impression about an individual on the basis of a single characteristic.
Horns effect - the tendency to draw a negative general impression about an individual based on a single characteristic.
Contrast effects
An old adage among entertainers says: ‘Never follow an act that has kids or animals in it’. Audiences love children and animals so much that anyone else will look bad in comparison. This example demonstrates how contrast effects can distort perceptions. We don’t evaluate a person in isolation. Our reaction to a person is influenced by other people we’ve recently encountered. For example, research on 22 teams in a Chinese hospitality organisation that was undergoing radical organisational change suggests that transformational leadership is more effective in improving support for the changes among followers when the former leader was not transformational—when the former leader was transformational, the new leader behaviours were not as effective.
Contrast effects - 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.
In a series of job interviews, for instance, interviewers can make distortions in any given candidate’s evaluation as a result of the candidate’s place in the interview schedule. A candidate is likely to receive a more favourable evaluation if preceded by mediocre applicants and a less favourable evaluation if preceded by strong applicants.
Stereotyping
When we judge someone on the basis of our perception of the group they belong to, we’re using the shortcut called stereotyping.
We rely on generalisations every day because they help us make decisions quickly; they’re a means of simplifying a complex world. It’s less difficult to deal with an unmanageable number of stimuli if we use heuristics or stereotypes. For example, it makes sense to assume that Trevor, the new employee from accounting, is going to know something about budgeting, or that Allie from finance will be able to help you work out a forecasting problem. The problem occurs, of course, when we generalise inaccurately or too much. In organisations, we frequently hear comments that represent stereotypes based on gender, age, race, religion, ethnicity and even weight;16 for example, ‘Women won’t relocate for a promotion’, ‘Men aren’t interested in child care’, ‘Older workers can’t learn new skills’, ‘Asian immigrants are hardworking and conscientious’ and ‘Overweight people lack discipline’. Stereotypes can be deeply ingrained and powerful enough to influence life-or-death decisions. One of the problems of stereotypes is that they are widespread and are often useful generalisations, despite the fact that they may not contain a shred of truth when applied to a particular person or situation. So, we constantly have to check ourselves to make sure we’re not unfairly or inaccurately applying a stereotype in our evaluations and decisions.
It should be obvious by now that our perceptions, many of which are near instantaneous and without conscious deliberation, colour our outlook. Sometimes they have little impact on anyone, but more often our perceptions greatly influence our decisions. The first step towards increasing the effectiveness of organisational decision making is to understand the perception process on an individualised level, a topic we’ll discuss next.
Stereotyping
When we judge someone on the basis of our perception of the group to which he or she belongs, we are using the shortcut called
stereotyping
.
15
We rely on generalizations every day because they help us make decisions quickly; they are a means of simplifying a complex world. It’s less difficult to deal with an unmanageable number of stimuli if we use
heuristics
or stereo-types. For example, it does make sense to assume that Tre, the new employee from accounting, is going to know something about budgeting, or that Allie from finance will be able to help you figure out a forecasting problem. The problem occurs, of course, when we generalize inaccurately or too much. In organizations, we frequently hear comments that represent stereotypes based on gender, age, race, religion, ethnicity, and even weight (see Chapter 2 ):
16
“Men aren’t interested in child care,” “Older workers can’t learn new skills,” “Asian immigrants are hardworking and conscientious.” A growing body of re-search suggests stereotypes operate emotionally and often below the level of conscious awareness, making them particularly hard to challenge and change.
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Stereotypes can be deeply ingrained and powerful enough to influence life-and-death decisions. One study, controlling for a wide array of factors (such as aggravating or mitigating circumstances), showed that the degree to which black defendants in murder trials looked “stereotypically black” essen-tially doubled their odds of receiving a death sentence if convicted.
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Another experimental study found that students who read scenarios describing leaders tended to assign higher scores for leadership potential and effective leader-ship to Whites than to minorities even though the content of the scenarios was equivalent, supporting the idea of a stereotype of Whites as better leaders.
Person perception: making judgements about others
Specific applications of shortcuts in organisations
Employment interview
Performance expectations
Self-fulfilling prophecy
Performance evaluation
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https://blog.talview.com/what-is-interview-bias-how-to-avoid-it-while-hiring
Interview bias refers to the human error of holding preconceived judgement about your interviewee, consciously or unconsciously, that clouds your evaluation of the candidate, negatively or positively, making the interview less objective and, hence, not successful. This usually occurs due to something called heuristics, or mental shortcuts that our brain takes to tackle difficult situations efficiently and it helps us make quick judgements. But this essential trait can be very problematic for a recruiter, especially while hiring for a niche role.
A few common interview biases that recruiters should keep in mind are listed below:
Cultural Noise – This bias occurs when the interviewee’s responses are according to what s/he thinks the interviewer would want to listen to rather than being honest about the responses. Here, it is the test of interviewer’s ability to distinguish between a candidate’s socially acceptable answer from their true opinion. e.g. the candidate might agree to work in a team as the interviewer stresses on their role involving teamwork.
Stereotyping Bias- This occurs when the interviewer assumes a candidate has certain traits because they are a member of a certain group. If job requirements include lifting 50 pounds, an interviewer might inaccurately assume women cannot meet this requirement.
Generalization Bias-Generalization bias can occur when interviewers assume candidates’ mannerisms in the interview are part of their everyday behavior. The interviewer might assume what the candidate did once is what s/he would always do. This bias plays on the phrase - the first impression is the last impression. For example, candidates who are nervous in the interview can be generalized as always being nervous.
People in organizations are always judging each other. Managers must appraise their employees’ performances. We evaluate how much effort our co-workers are putting into their jobs. Team members immediately “size up” a new person. In many cases, our judgments have important consequences for the organization. Let’s look at the most obvious applications.
Employment Interview
Few people are hired without an interview. But interviewers make perceptual judgments that are often inaccurate and draw early impressions that quickly become entrenched. Research shows we form impressions of others within a tenth of a second, based on our first glance.
If these first impressions are negative, they tend to be more heavily weighted in the interview than if that same information came out later.
Most interviewers’ decisions change very little after the first 4 or 5 minutes of an interview. As a result, information elicited early in the interview carries greater weight than does information elicited later, and a “good applicant” is probably character-ized more by the absence of unfavourable characteristics than by the presence of favourable ones.
It’s fair to say that few people are hired without an interview. But interviewers make perceptual judgements that are often inaccurate and draw early impressions that quickly become entrenched. Research shows that people form impressions of others within one-tenth of a second, based on their first glance. If these first impressions are negative, they tend to be more heavily weighted in the interview than if that same information came out later. Research indicates that our individual intuition about a job candidate isn’t reliable in predicting job performance, but that collecting input from multiple independent evaluators can be predictive. Most interviewers’ decisions change very little after the first 4 or 5 minutes of an interview. As a result, information elicited early in the interview carries greater weight than does information elicited later, and a ‘good applicant’ is probably characterised more by the absence of unfavourable characteristics than by the presence of favourable ones.
Performance Expectations
People attempt to validate their perceptions of reality even when these are faulty.
The terms self-fulfilling prophecy and Pygmalion effect
describe how an individual’s behavior is determined by others’ expectations. If a manager expects big things from her people, they’re not likely to let her down. Similarly, if she expects only minimal performance, they’ll likely meet those low expectations. Expectations become reality. The self-fulfilling prophecy has been found to affect the performance of students, soldiers, and even accountants.
Performance Evaluation
An employee’s future is closely tied to the appraisal—promotion, pay raises, and continuation of employment are among the most obvious outcomes. Although the appraisal can be objective (for example, a sales-person is appraised on how many dollars of sales he generates in his territory), many jobs are evaluated in subjective terms. Subjective evaluations, though often necessary, are problematic because all the errors we’ve discussed thus far— selective perception, contrast effects, halo effects, and so on—affect them. Ironically, sometimes performance ratings say as much about the evaluator as they do about the employee.
An employee’s future is closely tied to their performance appraisal—promotion, pay rises and continuation of employment are among the outcomes. Although the appraisal can be objective (e.g. salespeople are appraised on how many dollars of sales they generate in their department), many jobs are evaluated subjectively. Subjective evaluations, although often necessary, are problematic because of the errors we’ve discussed: selective perception, contrast effects, halo effects, and so on. Sometimes performance ratings say as much about the evaluator as they do about the employee!
Performance expectations
People attempt to validate their perceptions of reality even when they are faulty. The terms self-fulfilling prophecy and Pygmalion effect describe how an individual’s behaviour is determined by others’ expectations. If a leader expects big things from their team, the team members are unlikely to let their leader down. Similarly, if the leader expects only minimal performance, the team will probably meet those low expectations. Expectations become reality. The self-fulfilling prophecy has been found to affect the performance of students, defence personnel and even accountants.
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 original perception.
The link between perception and individual decision making
Part of working in an organisation involves making decisions.
The way individuals make decisions and the quality of their choices is largely influenced by their perceptions.
Awareness that a problem exists and whether a decision needs to be made are perceptual issues. One may see a problem while others do not based on one’s perception.
Every decision requires us to interpret and evaluate information which is influenced by one’s perception.
Through the entire decision-making process, perceptual distortions often surface that can bias analysis and conclusions.
jcu.edu.au
Part of working in an organisation involves making decisions. Ideally, decision making would be an objective process, but the way individuals make decisions and the quality of their choices are largely influenced by their perceptions. Individual decision making is an important factor of behaviour at all levels of an organisation and it comes about as a reaction to a problem—that is, a discrepancy exists between the current state of affairs and a desired state, requiring us to consider alternative courses of action. If your car breaks down and you rely on it to get to work, you have a problem that requires a decision on your part.
Decision - Making a choice from two or more alternatives.
Problem - A discrepancy between the current state of affairs and a desired state.
Unfortunately, most problems don’t come neatly packaged as a ‘problem’. One person’s problem is another person’s satisfactory state of affairs. One manager might view their division’s 2% decline in quarterly sales as a serious problem requiring immediate action on their part. In contrast, their counterpart in another division, who also had a 2% sales decrease, might consider that quite acceptable. So, awareness that a problem exists and whether a decision needs to be made are perceptual issues.
Every decision requires us to interpret and evaluate information. We typically receive data from multiple sources and need to screen, process and interpret these data. Which data are relevant to the decision and which are not? The decision maker’s perceptions will answer that question. We also need to develop alternatives and evaluate their strengths and weaknesses. Again, the individual’s perceptual process will affect the final outcome. Finally, throughout the entire decision-making process, perceptual distortions often surface that can bias analysis and conclusions.
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Decision making in organisations
The rational model, bounded rationality and intuition
Rational decision making: describes how individuals should behave in order to maximise an outcome
Bounded rationality: making decisions by constructing simplified models that extract the essential features from problems without capturing all their complexity
Intuition: an unconscious process created out of distilled experience
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Organisational psychology-based decision making also includes the systematic weighing of options, but, in addition, considers the role of emotions, politics, and practical consideration, which impact outcomes.
Organisational psychology-based decision making is most concerned with the context of decision making. Bounded rationality is the process where decision makers are forced to act, but must rely on limited information and time constraints when making a decision. Nobel prize winning economists Kahneman and Tversky developed a behaviour based approach to explain how people deviate from rational decision making. People may not be fully rational in how they make decisions, but they deviate in systematic and predictable ways.
Naturalistic decision making describes the process where decision makers rely on a quick assessment of a situation and draw on experience and intuition to determine a course of action; emotions and prior experience play a key part in making effective decisions. Describes how managers, teams, and organisations make decisions in natural settings; describes how decision makers draw on their experience, assess a situation, and determine a single, best course of action from available data. This research approach began in the 1980’s to study how people actually make decisions (firefighters, design engineers, managers etc) made in the course of their work and how they use their experiences to cope with changing pressures such as time pressure, uncertainty, high stakes and organisational constaints.
Peter Druker, author, educator, once said, the most common source of mistakes in management decisions is on finding the right answer rather than the right questions. For leaders to be successful they must ask difficult, probing questions to gather all the important facts and opinions before making a decision.
Making a decision entails four key design choices. First, leaders must consider the composition of the team that will be involved in the decision-making process. Second, they must shape the context of the decision process. Third they must focus on how individual and subgroups will communicate with one another. And, finally, leaders must consider how they will control the decision-making process. Research shows that individuals do not only care about the outcome of a decision, they care about how the decision was made. Before deliberations begin, leaders should establish ground rules that foster constructive dialogue – clarifying the roles that particular individuals play during the decision making process. Leaders should also help individuals understand and respect the fact that their colleagues may have different ways of analysing problems. To preserve freedom of choice, decision makes listen and avoid hasty actions. A rush judgement if also provoked by fear, greed, or needs for power. Confront each. Position in the decision accepting the uncertainty of not knowing what is best, agreeing not to screen out messages and engaging in reflective listening. Adopt a coaching role by initiating exploratory dialogues with stakeholders. Look for how competing interests can be reconciled.
Individuals base their behaviour not on the way their external environment actually is, but rather on the way they see it or believe it to be. An understanding of the way people make decisions can help us explain and predict behaviour, but few important decisions are simple or unambiguous enough for the rational model’s assumptions to apply. We find individuals looking for solutions that satisfice rather than optimise, injecting biases and prejudices into the decision process, and relying on intuition. Managers should encourage creativity in employees and teams to create a route to innovative decision making. Some ways to achieve this objective include:
To influence productivity, assess how your employees perceive their jobs. Clue into employee absenteeism, turnover and job satisfaction levels for indicators of their perception. Discuss with them their perceptions about fairness, compensation and other abstract measures to clear up any perceptual distortions.
Adjust your decision-making approach to the national culture you’re operating in and to the criteria your organisation values. If you’re working in a country that doesn’t value rationality, don’t feel compelled to follow the decision-making model or to try to make your decisions appear rational. Adjust your decision approach to ensure compatibility with the organisational culture.
Be aware of biases. Then try to minimise their impact.
Combine rational analysis with intuition. These are not conflicting approaches to decision making.
By using both, you can actually improve your decision-making effectiveness.
Try to enhance your creativity. Actively look for novel solutions to problems, attempt to see problems in new ways, use analogies and hire creative talent. Try to remove work and organisational barriers that might impede your creativity.
Researchers are divided about whether or not intuition helps effective decision making, but most experts are sceptical, in part because intuition is hard to measure and analyse (although expertise-based intuitive decisions tend to be more effective and accurate). Probably the best advice from one expert is: ‘Intuition can be very useful as a way of setting up a hypothesis but is unacceptable as “proof”’. Use hunches derived from your experience to speculate, yes, but always make sure to test those hunches with objective data and rational, dispassionate analysis.
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Exhibit 6.3
Steps in the rational decision-making model
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What is the rational model of decision making? How is it different from bounded rationality and intuition? The optimising decision maker is rational. He or she makes consistent, value-maximising choices within specified constraints. The six steps listed in the rational decision-making model are:
Define the problem.
Identify the decision criteria important to solving the problem.
Allocate weight the criteria in order to give them the correct priority in the decision.
Develop the alternatives that could succeed in resolving the problem.
Evaluate the alternatives.
Select the best alternative.
The rational model differs from bounded rationality and intuition in that bounded rationality is the ‘real world’ model that seeks satisfactory and sufficient solutions from limited data and alternatives. Intuition is a non-conscious process created from distilled experience that results in quick decisions. It relies on holistic associations and is affectively charged.
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Decision making in organisations – common biases
Common biases and errors in decision making
Overconfidence bias – overestimate your judgement in making a right decision
Anchoring bias - fix on initial information, fail to adjust for newer information
Confirmation bias – seek information that reaffirms, discount information that contradicts past judgement
Availability bias – judge base on information that is readily available
Escalation of commitment – increase commitment to a previous decision in spite of negative information
Randomness error – one believes one can predict the outcome of random events
Risk aversion – prefer a safer option
Hindsight bias – believe one would have accurately predicted the outcome in hindsight.
jcu.edu.au
Individuals in organizations make decisions, choices from among two or more alternatives. Top managers determine their organization’s goals, what products or services to offer, how best to finance operations, or where to locate a new manufacturing plant. Middle- and lower-level managers set production sched-ules, select new employees, and decide how to allocate pay raises. Nonmanagerial employees decide how much effort to put forth at work and whether to comply with a boss’s request. Organizations have begun empowering their non-managerial employees with decision-making authority historically reserved for managers alone. Individual decision making is thus an important part of organizational behaviour. But the way individuals make decisions and the quality of their choices are largely influenced by their perceptions. Decision making occurs as a reaction to a .problem
That is, a discrepancy exists between the current state of affairs and some desired state, requiring us to consider alternative courses of action. If your car breaks down and you rely on it to get to work, you have a problem that requires a decision on your part. Unfortunately, most problems don’t come neatly labelled “problem.” One person’s problem is another person’s satisfactory state of affairs.
One manager may view her division’s 2 percent decline in quarterly sales to be a serious problem requiring immediate action on her part. In contrast, her counterpart in another division, who also had a 2 percent sales decrease, might consider that quite acceptable. So awareness that a problem exists and that a decision might or might not be needed is a perceptual issue. Every decision requires us to interpret and evaluate information. We typically receive data from multiple sources and need to screen, process, and interpret them. Which data are relevant to the decision, and which are not? Our perceptions will answer that question. We also need to develop alter-natives and evaluate their strengths and weaknesses. Again, our perceptual
Overconfidence Bias
It’s been said that “no problem in judgment and decision making is more prevalent and more potentially catastrophic than overconfidence.”
When we’re given factual questions and asked to judge the probability that our answers are correct, we tend to be far too optimistic.
Anchoring bias - is a tendency to fixate on initial information and fail to adequately adjust for subsequent information.
It occurs because our mind appears to give a disproportionate amount of emphasis to the first information it receives. Anchors are widely used by people in professions in which persuasion skills are important—advertising, management, politics, real estate, and law. Assume two pilots—Jason and Glenda—have been laid
Confirmation Bias
The rational decision-making process assumes we objectively gather information. But we don’t. We selectively gather it. The confirmation bias represents a specific case of selective perception: we seek out information that reaffirms our past choices, and we discount informa-ion that contradicts them.
We also tend to accept at face value information that confirms our preconceived views, while we are critical and skeptical of information that challenges them. Therefore, the information we gather is typically biased toward supporting views we already hold. We even tend to seek sources most likely to tell us what we want to hear, and we give too much weight to supporting information and too little to contradictory. Interestingly, we are most prone to the confirmation bias when we believe we have good information and strongly believe in our opinions. Fortunately, those who feel there is a strong need to be accurate in making a decision are less prone to the confirmation bias.
Availability Bias
More people fear flying than fear driving in a car. But if flying on a commercial airline really were as dangerous as driving, the equivalent of two 747s filled to capacity would crash every week, killing all aboard. Because the media give much more attention to air accidents, we tend to overstate the risk of flying and understate the risk of driving. The availability bias is our tendency to base judgments on information readily available.
Events that evoke emotions, are particularly vivid, or are more recent tend to be more available in our memory, leading us to overestimate the chances of unlikely events such as an airplane crash. The availability bias can also explain why managers doing performance appraisals give more weight to recent employee behaviors than to behaviors of 6 or 9 months earlier, or why credit-rating agencies such as Moody’s or Standard & Poor’s may issue overly positive ratings by relying on information presented by debt issuers, who have an incentive to offer data favorable to their case.
Escalation of Commitment
Another distortion that creeps into decisions is a tendency to escalate commitment. Escalation of commitment refers to staying with a decision even when there is clear evidence it’s wrong. Consider a friend who has been dating someone for several years. Although he admits things aren’t going too well, he says he is still going to marry her. His justification: “I have a lot invested in the relationship!” Individuals escalate commitment to a failing course of action when they view themselves as responsible for the failure.
Randomness Error
Most of us like to think we have some control over our world and our destiny. Our tendency to believe we can predict the outcome of random events is the randomness error. Decision making suffers when we try to create meaning in random events, particularly when we turn imaginary patterns into superstitions.
These can be completely contrived (“I never make important decisions on Friday the 13th”) or can evolve from a reinforced past pattern of behaviour (Tiger Woods often wears a red shirt during a golf tournament’s final round because he won many junior tournaments wearing red shirts). Superstitious behavior can be debilitating when it affects daily judgments or biases major decisions.
Risk aversion has important implications. To offset the risks inherent in a commission-based wage, companies pay commissioned employees consider-ably more than they do those on straight salaries. Risk-averse employees will stick with the established way of doing their jobs, rather than taking a chance on innovative or creative methods. Sticking with a strategy that has worked in the past does minimize risk, but in the long run it will lead to stagnation. Ambitious people with power that can be taken away (most managers) appear to be especially risk averse, perhaps because they don’t want to lose on a gamble everything they’ve worked so hard to achieve.
Hindsight Bias is the tendency to believe falsely, after the outcome is known, that we’d have accurately predicted it.
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Influences on decision making: individual differences and organisational constraints
Individual differences
Personality: achievement-oriented people who hate to fail tend to escalate commitment, ie increase commitment ot previous decision in spite of negative information.
Gender: in stressful, men become more egocentric and make more risky decision while women become more empathetic and their decision making improves.
Mental ability: higher level able to process information quickly, solve problems more accurately and learn faster.
Cultural differences: influence selection of problems, depth of analysis, use of logic and rationality, individual or group decisions
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Personality
The little research so far conducted on personality and decision making suggests that personality does influence our decisions.
Specific facets of conscientiousness, rather than the broad trait itself, may affect escalation of commitment (see above).Two such facets—achievement striving and dutifulness—actually have opposite effects. Achievement-striving people are more likely to escalate their commitment, whereas dutiful people are less likely because, generally, achievement-oriented people hate to fail, so they escalate their commitment, hoping to forestall failure. Dutiful people, however, are more inclined to do what they see as best for the organisation. In addition, achievement-striving individuals appear to be more susceptible to hindsight bias, perhaps because they have a greater need to justify their actions. Unfortunately, we don’t have evidence on whether dutiful people are immune to this bias.
Finally, people with high self-esteem are strongly motivated to maintain it, so they use the self-serving bias to preserve it. They blame others for their failures while taking credit for successes. In a more extreme case, those with the personality trait of grandiosity, a facet of narcissism, tend to engage in self-serving bias.
Gender
Who makes better decisions: men or women? It depends on the situation. When the situation isn’t stressful, decision making by men and women is about equal in quality. In stressful situations, it appears that men become more egocentric and make more risky decisions, while women become more empathetic and their decision making improves.
Research on rumination, or reflecting on an issue at length, offers insights into gender differences in decision making. More than two decades of study has found that women spend much more time than men analysing the past, the present and the future. They are more likely to overanalyse problems before making a decision and to rehash a decision once it’s made. This can lead to more careful consideration of problems and choices. However, it can make problems harder to solve, increase regret over past decisions and increase depression. Women are nearly twice as likely as men to develop depression, but why they ruminate more than men is unclear; some research points to differences in the hypothalamus, pituitary and adrenal gland responses.63 However, the gender difference seems to lessen with age. Differences are largest during young adulthood and smallest after age 65, when both men and women ruminate the least.
Mental ability
We know that people with higher levels of mental ability are able to process information more quickly, solve problems more accurately and learn faster, so you might expect them to also be less susceptible to common decision errors. However, mental ability appears to help people avoid only some of these. Smart people are just as likely to fall prey to anchoring, overconfidence and escalation of commitment, probably because being smart doesn’t necessarily alert you to the possibility that you are too confident or emotionally defensive. That doesn’t mean that intelligence never matters. Once warned about decision-making errors, more intelligent people learn more quickly to avoid them.
Cultural differences
The rational model makes no acknowledgement of cultural differences, nor does the bulk of OB research literature on decision making. But Indonesians, for instance, don’t necessarily make decisions the same way Australians do. Therefore, we need to recognise that the cultural background of a decision maker can significantly influence the selection of problems, the depth of analysis, the importance placed on logic and rationality, and
Influences on decision making: individual differences and organisational constraints
Organisational constraints
Performance evaluation: influence by criteria used to evaluate them.
Reward systems: choices that lead to better pay-off.
Formal regulations: program decisions (rules and policies) that get individuals to act in an intended manner.
System-imposed time constraints: affect information gathering and evaluation.
Historical precedents: choices made today are largely a result of choices made over the years.
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Organisational constraints
Organisations can constrain decision makers, creating deviations from the rational model. For instance, managers shape their decisions to reflect the organisation’s performance evaluation and reward system, to comply with its formal regulations and to meet organisationally imposed time constraints. Precedent can also limit decisions.
Performance evaluation
Managers are strongly influenced by the criteria on which they are evaluated. If a division manager believes that the manufacturing plants under his responsibility are operating best when he hears nothing negative, we shouldn’t be surprised to find his plant managers spending a good part of their time ensuring that negative information doesn’t reach him.
Reward systems
The organisation’s reward system influences decision makers by suggesting what choices have better personal pay-offs. If the organisation rewards risk aversion, managers are more likely to make conservative decisions. From the 1930s to the mid 1980s, General Motors consistently gave promotions and bonuses to managers who kept a low profile and avoided controversy. These people became very adept at dodging tough issues and passing controversial decisions on to committees.
Formal regulations
One manager at a McDonald’s restaurant in Sydney describes constraints he faces in his job: ‘I’ve got rules and regulations covering almost every decision I make—from how to cook fries to how often I need to clean the bathrooms. My job doesn’t come with much freedom of choice’. His situation isn’t unique. All but the smallest organisations create rules and policies to program decisions and get individuals to act in the intended manner. And, of course, in so doing they limit decision choices.
System-imposed time constraints
Almost all important decisions come with explicit deadlines. A report on new-product development may have to be ready for executive committee review by the first of the month. Such conditions often make it difficult, if not impossible, for managers to gather all the information they might like before making a final choice.
Historical precedents
Decisions aren’t made in a vacuum; they have a context. In fact, individual decisions are points in a stream of choice. Those made in the past are like ghosts that haunt and constrain current choices. It’s common knowledge that the largest determinant of the size of any given year’s budget is last year’s budget. Choices made today are largely a result of choices made over the years.
Three ethical decision criteria
Three ways to frame decisions ethically
Utilitarianism: decision that provides the greatest good for the greatest number.
Make decisions consistent with fundamental rights and privileges eg right to privacy, free speech.
Impose and enforce rules fairly and impartially to ensure justice or an equitable distribution of benefits and costs
Behavioural ethics – analyse how people behave when confronted with ethical dilemma.
Lying – is deadly to decision making as facts are misrepresented.
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https://freeessays.club/organizational-behavior-three-ethical-decision-criteria/
The success of organizations depends on the daily decisions made. A key role in management is played by decision-making, based on certain criteria for selecting tools to achieve the set goals. Modern researchers note the multifaceted nature of the management decision, the plurality of limitations and criteria for assessing its correctness and optimality, which can be legal, economic, technological, social, moral and ethical. Thus, there are three ethical decision criteria, and they are utilitarianism, the rights criterion and the justice criterion.
Firstly, the basic principles of utilitarianism are that behavior that is commensurate with moral standards brings the greatest benefit to the largest number of people. The decision maker should consider the impact of each of his options on all stakeholders and choose the option that satisfies the greatest number of people. Secondly, the rights criterion asserts that a person is initially endowed with fundamental rights and freedoms that cannot be violated or limited by decisions of other people. This means that the solution that best meets the rights of the people it affects is ethically correct. According to Robbins and Judge (2017), in the process of making a decision, the following moral rights should be taken into account: the right to free speech, privacy and due process. Thirdly, the justice criterion states that an ethically correct decision should be based on the principles of equality, honesty and impartiality. It means that distributive justice requires that the attitude of the manager to the subordinates is based on objective criteria. Thus, if the decision refers to similar individuals, there is a necessity to check that everybody is treated equally.
The first ethical yardstick is utilitarianism, whereby decisions are made solely on the basis of their outcomes, ideally to provide the greatest good for the greatest number. This view dominates business decision making. It’s consistent with goals such as efficiency, productivity and high profits.
Another ethical criterion is to make decisions consistent with fundamental rights and privileges, as declared in documents such as a Bill of Rights. An emphasis on rights in decision making means respecting and protecting the basic rights of individuals, such as the right to privacy, free speech or due process. This right to free speech protects whistle-blowers when they reveal an organisation’s unethical practices to the press or government agencies.
Researchers are turning increasingly to behavioural ethics—an area of study that analyses how people behave when confronted with ethical dilemmas. Their research tells us that, while ethical standards exist collectively in societies and organisations, and individually in the form of personal ethics, we don’t always follow ethical standards promoted by our organisations, and we sometimes violate our own standards. Our ethical behaviour varies widely from one situation to the next.
Behavioural ethics research stresses the importance of culture to ethical decision making. There are few global standards for ethical decision making,73 as contrasts between Asia and the West illustrate. What is ethical in one culture may be unethical in another. For example, because bribery is more common in countries such as China, an Australian working in China might face a dilemma: Should I pay a bribe to secure business if it is an accepted part of that country’s culture? Although some companies, such as IBM, explicitly address this issue, many don’t. Without sensitivity to cultural differences as part of the definition of ethical conduct, organisations may encourage unethical conduct without even knowing it.
Lying
Are you a liar? Many of us wouldn’t like to be labelled a liar. But if a liar is merely someone who lies, we’re all liars. We lie to ourselves, and we lie to others. We lie consciously and unconsciously. We tell big lies and create small deceptions. Lying is one of the top unethical activities we likely indulge in daily, and it undermines all efforts towards sound decision making.
Improving creativity in decision making
Creativity is the ability to produce novel and useful ideas.
Three-stage model of creativity
Exhibit 6.4
(Intelligence, personality, expertise)
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https://www.businessmanagementideas.com/decision-making/creativity-in-decision-making-meaning-process-and-components/4837
Meaning of Creativity:
Creativity means creating something new. In the context of business, it means creation of new ideas, new method or new product/service.
Creativity is the “cognitive process of developing an idea, concept, commodity, or discovery that is viewed as novel by its creator or a target audience.” — Max H. Bazerman
“Creativity is not a quality of a person; it is a quality of ideas, of behaviours or products.” — Teresa M. Amabile
Creativity improves the quality of decisions. It increases the scope of alternatives to be considered for problem-solving. It is essential to deal with problems which are no-repetitive and novel as such problems cannot be solved by pre-defined solutions. They require imaginative thinking for their solution. As no problem has a single solution, creativity helps in generating new ideas that help in taking the final decision.
The creative approach to problem solving assumes the following:
1. There is always a better way of doing things. Past precedents, habits and conventional ways of doing things cannot always guide the future courses of action.
2. Problems have diverse perspectives. Each perspective should be probed, questions should be raised and answers should be found.
3. Things should not be taken for granted. Problems should be redefined and obvious facts should be challenged.
4. There is always scope for improvement. Managers should move from traditional ways to modern, computer-aided ways of managing organisations.
5. Managers should not be afraid of failures. Initial failures will lead to ultimate success.
Creativity in decision-making results in organisational innovations, new technology or new products.
In the era of globalisation, competition is so intense that creativity is essential for organisations to take decisions that help in their survival and growth.
The creativity process requires:
1. Convergent thinking,
2. Divergent thinking.
In convergent thinking, the problem is solved according to pre-defined method or course of action. It pre-supposes solution to the problem and rationally moves towards that solution. Divergent thinking does not solve the problem in a pre-defined way. It analyses different aspects of the problem, views it in different ways and searches for alternative courses of action to solve that problem.
Creativity is valuable in decision making because it allows the decision maker to more fully appraise and understand the problem, including seeing problems that others can’t see. Global company L’Oréal puts its managers through creative exercises such as cooking or making music, and many business schools now require that MBA students express themselves creatively about their experiences through film, writing and even the performing arts.
Although all aspects of organisational behaviour have complexities, this is especially true for creativity. Exhibit 6.4 illustrates a three-stage model of creativity, a simplified model of creativity for use in organisations. The core of the model is creative behaviour, which has both causes (predictors of creative behaviour) and effects (outcomes of creative behaviour). In this section, we discuss the three stages of creativity, starting with the centre one in the model: creative behaviour.
Summary
Individuals base their behaviour on the way they see the environment or believe it to be instead of the way it actually is.
An understanding of the way people make decisions can help explain and predict behaviour, but most decisions are not simple enough for the rational model’s assumptions to apply.
Managers should encourage creativity in employees and teams to create a route to innovative decision making.
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Individuals base their behaviour not on the way their external environment actually is, but rather on the way they see it or believe it to be. An understanding of the way people make decisions can help us explain and predict behaviour, but few important decisions are simple or unambiguous enough for the rational model’s assumptions to apply. We find individuals looking for solutions that satisfice rather than optimise, injecting biases and prejudices into the decision process, and relying on intuition. Managers should encourage creativity in employees and teams to create a route to innovative decision making.
Implications for managers
Behaviour follows perception, so to influence behaviour at work, assess how people perceive their work. Often behaviours we find puzzling can be explained by understanding the initiating perceptions.
Make better decisions by recognising the perceptual biases and decision-making errors we tend to commit. Learning about these problems doesn’t always prevent us from making mistakes, but it does help.
Adjust your decision-making approach to the national culture you’re operating in and to the criteria your organisation values. If you’re in a country that doesn’t value rationality, don’t feel compelled to follow the decision-making model or to try to make your decisions appear rational. Adjust your decision approach to ensure compatibility with the organisational culture.
Combine rational analysis with intuition. These are not conflicting approaches to decision making. By using both, you can improve your decision-making effectiveness.
Try to enhance your creativity. Actively look for novel solutions to problems, attempt to see problems in new ways, use analogies and hire creative talent. Try to remove work and organisational barriers that might impede creativity.
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Class Activity
You are randomly assigned to a workshop discussion group.
Go to subject homepage -> Workshop Discussions -> Workshop 3: Group discussions on....
Your task is to discuss in your group the following topic. As this is a discussion and not an individual post, you will need to submit more than one entry in your discussion board. Odd number groups will work on question 1. Even number groups on question 2.
Question 1: Emotions and moods
The affective events theory proposes that managers should not ignore emotions, because they accumulate. Will this lead to undesirable organisational behaviour?
Question 2: Perception and decision making
How does one’s perception affects the quality of decision making? Provide some illustrations to support your answers.
Discussion board is opened only for today!
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