Perception is the process by which individuals organize and interpret their sensory impressions to give meaning to their environment. It is influenced by factors related to the perceiver, perceived object or situation, and the context. Perception involves several stages including sensation, attention, interpretation, and relating to past experiences. Common perceptual biases that can distort perception include stereotypes, halo effects, selective perception, projection, and self-fulfilling prophecies. Managing perceptions and addressing potential distortions is important for effective management.