Perception and individual decision making : -Perception and factors that influence perception -Person Perception : Making Judgement about others -Link between perception and individual decision making -How should the decision be made? -How are decision actually made in organizations? -Ethics in decision making -Improving creativity in decision making

1. Perception and
Individual Decision
Making
Faizatul Hiqmah

2. What will
we learn?
Perception and factors that influence
perception
Person Perception : Making Judgement
about others
Link between perception and individual
decision making
How shoud the decision be made?
How are decision actually made in
organizations?
Ethics in decision making
Improving creativity in decision making

3. Factors Influence
Perception
PERCEIVER
TARGET
SITUATION
• Process by which individuals
organize and interpret their
sensory impressions in order
to give meaning to their
environment
Perception
• People behavior is based on
their perception. NOT ON
REALITY ITSELF
Why important to
OB :

4. Person Perception :
Making Judgement about Others
Attribution Theory
•Observing others is based on the determination of whether it was internal/externally caused.
•Distinctiveness
•Consensus
•Consistency
Frequently used shortcuts in Judging Others
•Selective perception
•Halo Effect
•Contrast Effect
•Stereotyping
Spesific application of Shortcuts in Organizations
•Employment interview
•Performance expectation
•Performance evaluation

5. The Link between Perception
and Individual Decision
MakingDecision : Choices made among two or
more alternatives
Decision making  Reaction to problems
Discrepancy between current state of
affairs and desired state  alternative
courses of action
Decision = interpretation and evaluation of
information

6. How Should
Decision be
Made?
• Defining problems
• Identify the decision criteria important to solving the problems
• Weight the previously identified criteria in order to give them the
correct priority in the decision
• Generate possible alternatives that could succeed in resolving
problems
• Rate each alternative on each criterion
• Compute the optimal decision
Rational Decision Making Process
• Problem clarity
• Known options
• Possible consequences in each alternatives
• Clear preference
• Constant preferences
Assumption of the models

7. How are
Decision
Actually made
in
Organizations?
Bounded Rationality
• When faced with a complex problem, most people respond
by reducing the problem to a level at which it can be
understood
Why?
• Limited information-processing capability
• People satisfice – seek solution that are satisfactory and
sufficient

8. Overconfidence Bias
Anchoring Bias
Confirmation Bias
Availability Bias
Representatives Bias
Escalation of Commitment
Randomness Error
Winner’s Curse
Hindsight Bias
How are
Decision
Actually made
in
Organizations?

9. How are
Decision
Actually made
in
Organizations?
• Unconscious process created of distiled experiences
Intuition
• High level of uncertainty exists
• Little precedents to draw on
• Variables are less scientifically predictable
• “Facts” are limited
• Facts do not clearly point the way to go
• Analitical data are of little use
• Several plausible alternatives to choose, with good arguments
for each
• Time is limited
In what condition Intuition works?
• Personality  Constientiousness
• Gender  Rumination
Individual Differences
• Performance evaluation
• Reward systems
• Formal regulation
• System imposed time constraints
• Historical Precedents
Organizational Constraints

10. Ethics in Decision Making
Utilitarian
Focus on the rights
Focus on Justice

11. Improving
Creativity in
Decision
Making
Expertise
Creative thinking skills
Intrinsic task motivation

12. Thank You
Faizatul Hiqmah