Slides - Perception and Decision Making.pptx

Perception: Applied.
• In organizational life and decision-making

What Is Perception? (1 of 2)
a process
• Perception is by which individuals
organize
and interpret their sensory impressions to give meaning
environment
to their .
• It is important to the study of Organizational
Behaviour because people’s
Behavior are based on their perception of what reality
is, not on reality itself.
• Humans tend to group sensory information which
organizes their experiences

1. Principles of Perception - Gestalt
Copyright © 2023, 2019, 2017 Pearson Education, Inc.

Gestalt Psychology
• Gestalt theory views human beings as open
systems,
actively and constantly interacting with the
environment
around them. Unlike the elementistic
way of
understanding psychological events, such as
behaviorism,
associationism, and psychoanalysis, Gestalt
theory is
suited to understanding the order and
structure of
psychological
events.
• Gestalt theorists' basic belief was that any
psychological
phenomenon, from perceptual processes to
human
personality, should be studied holistically; that is,
they
should not be broken down into components, but
rather
studied as a
whole.
• As a contrast to structural approaches, the
Gestalt
psychologists studied perceptions as complete,
indivisible
phenomen
a.

Max Wertheimer (1880-1943)
• The beginning of Gestaltism is
attributed to Wertheimer in 1910.
• While riding a train on a vacation, he
comes up with the idea that perceptions
have structures that sensory stimuli do
not have.
• In other words, he started exploring the
idea that perceptions contain unique
properties which do not come from nor
exist in the environment (stimulus).

Koffka and Köhler
• Kurt Koffka and Wolfgang Köhler worked closely with
Wertheimer, and helped to construct the properties of
Gestaltism.
• Koffka published the first English article in 1921, called
“Perception: An Introduction to Gestalt-Theorie.”
(in Psychological Bulletin)
• In the 1930’s Köhler started publishing articles
which related Gestalt theory to the field theory of
physics (the best explanations of gestalt).

When we look at an image with repeated
elements, like the circles and squares in this
example, our brain will try to organize the
information. We create a visual pattern, of four
groups of circles and a plus sign of squares
instead of just a mass of shapes.
The Law of Similarity

This example is similar to the last frame in that we
are still visually organizing the information into a
more simple pattern. The interesting thing to me is
that although it is a simple group of circles of the
same size, because of their black and white
values we put them into different visual
categories.
The Law of Similarity

The Law of Pragnanz
• As with physical forces, a gestalt brain would organize
in the simplest way possible.
• The resulting mental essence will be “as good as
conditions will allow” (will be “Pragnanz”).
• The brain works from top to bottom (top-down).
It starts with the whole, then proceeds to
address the parts as desired.

Monocular Cues
•Relative Size – smaller image
more distant

Monocular Cues
–
• Interposition – if one object partially
blocks another, we perceive it as
closer.

Monocular Cues
• Relative clarity – hazy objects are seen as
more distant.
Because light from distant objects passes through more
light than closer objects, we perceive hazy objects to be
farther away than those objects that appear sharp and
clear

Monocular Cues
• Relative height – objects higher
in our field of vision appear
farther away; vertical longer than
horizontal.

Monocular Cues
•Linear Perspective – parallel
lines appear to converge
w/distance.

Monocular Cues
• Light & shadow (relative
brightness) – closer objects appear
brighter; shading produces depth.

26
Objects traveling towards us grow in size and those moving
away shrink in size. The same is true when the observer moves
to or from an object.
Motion Perception

Stroboscopic Movement
The brain will interpret a rapid series
of slightly varying images as
continuous movement.

Perceptual Constancy
• Perceiving objects as unchanging
even as illumination & retinal
images change.

• Size – car driving away appear
smaller but doesn’t shrink

• Shape – look
at a dinner
plate from
various angles
• Lightness –
shirt looks
different in
different light

Perceptual Constancy –
Ponzo Illusion
The distant monster and top red bar
appear bigger because of distance
cues.

36
Lightness Constancy
The color and brightness of square A and B are the
same.

Theories about how we see and
what we see:
1. Template Matching: our brains have a
template for everything we need to know and we
match what we see to the templates
2. Prototype Matching: we see what the best
example of something is and see if they are
close enough to match
3. Feature Analysis: we break down a feature
into parts and analyze what it is

Phi Phenomenon
• An illusion of movement
created when two or more
adjacent lights blink on and
off in succession.
• Marquees or holiday lights

Gestalt theory
• The phi phenomenon was not a discovery, as motion pictures
had been around for decades.
• It was Wertheimer’s explanation of the phenomenon which
constituted the scientific contribution. The explanation,
though, will take a few slides.
• To follow up his finding, Wertheimer created a set of
three blinking lights. The middle light blinked, then the
two outside lights blinked.
• With these lights (at ten blinks per second), people
perceived a single light that moved in both
directions, then merged back in the middle.
• He showed perceptions which could not be learned
(perceiving unnatural movement).
• Sensory explanations were inadequate.
• Wertheimer needed a “gestalt” theory, which came together
with the help of two assistants …

Gestalt Learning
• The real world is a “geographical
environment” (G.E.) – it is what it
is.
• The “behavioral environment” (B.E.)
is in our mind (brain) – a subjective
pragnanz of the G.E..
• “Problems” occur when the G.E. does
not match our B.E., which disrupts
the brain’s equilibrium (disrupts the
pragnanz).
• The disruption motivates us to solve
the problem by making a greater
effort to “see” the solution in the
geographical environment.

2. Factors That Influence
Perception, Attribution Theory and
Common Shortcuts

Explain the Factors That Influence
Perception

Explain Attribution Theory
• Attribution theory tries to explain the ways we judge
people differently depending on the meaning we attribute
to a behavior
• Attribution theory suggests that when we observe an
individual’s behavior, we attempt to determine whether it
was internally or externally caused.
• Determination depends on three factors:
– Distinctiveness
– Consensus
– Consistency

• Clarification of the differences between internal and
external causation
– Internally caused – those that are believed to be
under the personal control of the individual.
– Externally caused – resulting from outside
causes.

• Distinctiveness: refers to whether an individual displays different behaviors in different
situations.
– Is the employee who arrives late today also one who regularly “blows off” other
kinds of commitments?
– What we want to know is whether this behavior is unusual. If it is, we are likely to
give it an external attribution. If it is not, we will probably judge the behavior to be
internal.
• Consensus: The behavior of our tardy employee meets this criterion if all employees
who took the same route were also late.
– 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 attribute his lateness to an internal cause.
• Consistency.
– Does the person respond the same way over time? Coming in 10 minutes late for
work is not perceived the same for an employee who hasn’t been late for several
months as for an employee who is late three times a week.
– The more consistent the behavior, the more we are inclined to attribute it to internal
causes

Common Shortcuts in Judging Others/
Psychological Unconscious Bias
• Fundamental attribution error
– We have a tendency to underestimate the influence of
external factors and overestimate the influence of
internal or personal factors.
• Self-serving bias
– Individuals attribute their own successes to internal
factors.

– Selective perception
▪ Any characteristic that makes a person, object, or
event stand out will increase the probability that it
will be perceived.
▪ Since we can’t observe everything going on around
us, we engage in selective perception.

• Halo effect
– The halo effect occurs when we draw a general
impression based on a single characteristic.
• Horns effect
– The tendency to draw a negative general impression
about an individual based on a single characteristic.
• Contrast effects
– We do not evaluate a person in isolation.
– Our reaction to one person is influenced by other
persons we have recently encountered.

• Stereotyping
– Judging someone based on one’s perception of the
group to which that person belongs.
▪ We have to monitor ourselves to make sure we’re
not unfairly applying a stereotype in our evaluations
and decisions.

Applications of Shortcuts in Organizations
• – Employment Interview
▪ Evidence indicates that interviewers make
perceptual judgments that are often inaccurate.
– Interviewers generally draw early impressions that
become
very quickly entrenched.
– Studies indicate that most interviewers’ decisions change
very little after the first four or five minutes of the interview.
– information elicited early in the interview carries greater
weight than does information elicited later, and a “good
applicant” is probably characterized more by the
absence of unfavorable characteristics than by the
presence of favorable ones

• Performance Expectations
– Evidence demonstrates that people will attempt to
validate their perceptions of reality, even when
those perceptions are faulty.
▪ Self-fulfilling prophecy, or the Pygmalion effect,
characterizes the fact that people’s expectations
determine their behavior.
– Expectations become reality.

• Performance Evaluation
– An employee’s performance appraisal is very much
dependent upon the perceptual process.
▪ Many jobs are evaluated in subjective terms.
▪ Subjective measures are problematic because of
selective perception, contrast effects, halo effects,
and so on.

• Social Media
– About four in ten organizations use social media or
online searches to screen applicants for jobs.
– Research supports the social media decision-making
bias link.
• Potential Remedies
– AI-assisted performance assessments (Still have bias
though…)
– Other decision-support systems (scenario-based role-
playing; situational interview questions)

3. Perception and Decision Making

Explain the Link Between Perception
and Decision Making
• Individuals make decisions – choosing from two or more
alternatives.
• Decision making occurs as a reaction to a problem.
– There is a discrepancy between some current state of
affairs and some desired state, requiring
consideration of alternative courses of action.
▪ One person’s problem is another’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. Her counterpart in
another division, who also had a 2 percent sales decrease, might consider it
quite acceptable.

Rational Model of Decision Making vs.
Bounded Rationality and Intuition (1 of 12)
Steps in the Rational Decision-Making Model:
1. Define the problem.
2. Identify the decision criteria.
3. Allocate weights to the criteria.
4. Develop the alternatives.
5. Evaluate the alternatives.
6. Select the best alternative.

• Assumptions of the Rational Model
– The decision maker…
▪ Has complete information.
▪ Is able to identify all the relevant options in an
unbiased manner.
▪ Chooses the option with the highest utility.
• However, most decisions in the real world don’t follow
the rational model.

• Bounded Rationality
– Most people respond to a complex problem by
reducing it to a level at which it can be readily
understood.
▪ People satisfice – they seek solutions that are
satisfactory and sufficient.
– Individuals operate within the confines of bounded
rationality.
▪ They construct simplified models that extract the
essential features.
• Intractable problem—a problem that may change entirely or become
irrelevant before we finish the process of organizing our thoughts,
gathering information, analyzing the information, and making judgments
or decisions.

• Intuition
– Intuitive decision making occurs outside conscious
thought; it relies on holistic associations, or
links between disparate pieces of information, is fast,
and is affectively charged, meaning it usually
engages the emotions.
– The key is neither to abandon nor rely solely on
intuition, but to supplement it with evidence and
good judgment.

4. Common Decision-making Biases
and Errors

• Common Biases and Errors in Decision Making
– Overconfidence Bias: individuals whose intellectual
and interpersonal abilities are weakest are most likely
to overestimate their performance and ability.
– Anchoring Bias: fixating on initial information as a
starting point and failing to adequately adjust for
subsequent information.
Common Decision-making Biases and
Errors

• Confirmation Bias: type of selective perception.
– Seek out information that reaffirms past choices, and
discount information that contradicts past judgments.
• Availability Bias: tendency for people to base judgments
on information that is readily available.
Errors

• Escalation of Commitment: staying with a decision
even when there is clear evidence that it’s wrong.
– Likely to occur when individuals view themselves as
responsible for the outcome.
• Randomness Error: our tendency to believe we can
predict the outcome of random events.
– Decision making becomes impaired when we try to
create meaning out of random events.
Errors

• Risk Aversion: the tendency to prefer a sure thing instead
of a risky outcome.
– Ambitious people with power that can be taken away
appear to be especially risk averse.
– People will more likely engage in risk-seeking
behavior for negative outcomes, and risk-averse
behavior for positive outcomes, when under stress.
Errors

• Hindsight Bias: the tendency to believe falsely that one
has accurately predicted the outcome of an event, after
that outcome is actually known.
Errors

Reducing Biases and Errors
1. Focus on Goals. Without goals, you can’t be rational, you don’t
know what information you need, you don’t know which information is
relevant and which is irrelevant, you’ll find it difficult to choose between
alternatives, and you’re far more likely to experience regret over the
choices you make. Clear goals make decision making easier and help
you eliminate options that are inconsistent with your
interests
.
2. Look for Information That Disconfirms Your Beliefs. One of the
most effective means for counteracting overconfidence and the
confirmation and hindsight biases is to actively look for information that
contradicts your beliefs and assumptions.
When we overtly consider various ways we could be wrong, we
challenge our tendencies to think we’re smarter than we actually are.

3. Don’t Try to Create Meaning out of Random Events.
The educated mind has been trained to look for cause-and-effect
relationships. When something happens, we ask why. And when we
can’t find reasons, we often invent them.
You have to accept that there are events in life that are outside
your control.
Ask yourself if patterns can be meaningfully explained or whether
they are merely coincidence. Don’t attempt to create meaning out
of coincidence.
Reducing Biases and Errors
4. Increase Your Options.
No matter how many options you’ve identified, your final choice can be
no better than the best of the option set you’ve selected.
This argues for increasing your decision alternatives and for using
creativity in developing a wide range of diverse choices.
The more alternatives you can generate, and the more diverse those
alternatives, the greater your chance of finding an outstanding one.
Source: Based on S. P
. Robbins, Decide & Conquer: Making Winning Decisions and Taking Control of Your Life (Upper
Saddle River, NJ: Financial Times/Prentice Hall, 2004), 164–68.

5. Individual Differences,
Organizational Constraints, and
Decision Making

Individual Differences, Organizational
Constraints, and Decision Making (1 of 2)
• Individual Differences
– Personality
▪ Big Five Personality
▪ Self-esteem
– Gender
– Mental Ability
– Cultural Differences

– Personality
▪ Big Five
Personality
▪ High self-esteem
– Trust towards
one’s own
decision?

– Gender
▪ Decision-making: 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.
▪ Rumination: Women spend more time than men analyzing the past,
present, and future. They’re more likely to overanalyze problems before
deciding and to rehash a decision once made. This can make problems
harder to solve, increase regret over past decisions, and increase
depression. Women are nearly twice as likely as men to developdepression.

– Mental Ability
▪ Higher levels of mental ability can process information more quickly,
solve problems more accurately, and learn faster, so you might expect
them to be less susceptible to common decision errors.
▪ Smart people are just as likely to fall prey to anchoring, overconfidence,
and escalation of commitment, probably because being smart doesn’t
alert you to the possibility that you’re too confident or emotionally
defensive. It’s not that intelligence never matters. Once warned about
decision-making errors, more intelligent people learn to avoid them
more quickly

• Individual Differences –
Cultural Differences
1) Differences in time orientation help us understand;
2) While rationality is valued in North America, that’s not true elsewhere. A
North American manager might decide intuitively but know it’s important
to appear to proceed in a rational fashion because rationality is highly
valued in the West.
3) Some cultures emphasize solving problems, while others focus on
accepting situations as they are.
4) Collectivism vs Individualism: Decision making in Japan is much more
group-oriented than in the United States. The Japanese value conformity
and cooperation, so before Japanese CEOs make an important decision,
they collect a large amount of information to use in consensus-forming
group decisions.

• Organizational Constraints
– Performance Evaluation Systems
▪ Managers are influenced by the criteria on which they
are evaluated.
– Reward Systems
▪ The organization’s reward systems influence decision
makers by suggesting which choices have better personal
payoffs.
– Formal Regulations
▪ All but the smallest organizations create rules and policies to program
decisions and get individuals to act in the intended manner. In doing
so, they limit decision choices

– System-Imposed Time Constraints
▪ Almost all important decisions come with explicit deadlines.
– Historical Precedents
▪ Decisions aren’t made in a vacuum; they have context.
Individual decisions are points in a stream of choices;
those made in the past are like ghosts that haunt and
constrain current choices.

– Decision-Making in Times of Crisis

6. Contrast the Three Ethical
Decision Criteria

Contrast the Three Ethical Decision
Criteria (1 of 3)
• Utilitarianism: decisions are made solely on the basis
of their outcomes or consequences.
• Focus on rights: calls on individuals to make decisions
consistent with fundamental liberties and privileges as
set forth in documents such as the Bill of Rights.
– Protects whistle-blowers.
• Impose and enforce rules fairly and impartially to ensure
justice or an equitable distribution of benefits and costs.

Criteria (2 of 3)
• Behavioral ethics: an area of study that analyzes how
people behave when confronted with ethical dilemmas.
1.Individuals do not always follow ethical standards
promulgated by their organizations, and we sometimes
violate our own standards.
2. Consider cultural differences.
▪ Without sensitivity to cultural differences as part of
the definition of ethical conduct, organizations may
encourage unethical conduct without even knowing
it.

Criteria (3 of 3)
• Lying
– Lying and dishonest behavior are very common.
– It undermines all efforts toward sound decision making.
• Managers—and organizations—simply cannot make good
decisions when facts are misrepresented and people give
false motives for their behaviors.
• Lying is a big ethical problem as well.

Example and discussion:
Layoff during the Pandemic
– A good DESICION?
“Airbnb Was Like a Family, Until the Layoffs Started”
 Airbnb planned to lay off nearly 1,900 employees, or about 25% of the company.
 “Airbnb’s business has been hit hard, with revenue this year forecasted to be less than half
of what we earned in 2019.”
 Discuss:
 If you are the CEO,
what decision will
you make?
 Do you think layoff is
a good decision?
Why?
Airbnb’s CEO - Brian Chesky

Layoff during the Pandemic
– A good DESICION?
Tough Call
yet More Ethical/Humane Ways:
 Give your employees a humane
warning [e.g., explained the What,
Why, and Hows of the situation in a
transparent and compassionate
manner]
 Help your departed staff recover
from the loss of their livelihood –
they care as a company [e.g.,
Severance; Equity; Healthcare
(includes mental health support); Job
support to help their soon-to-be
former employees get back on their
feet]
 Provide clarity into the process of
the reductions [e.g., a clear
breakdown of what will happen
next]

What happened to contractors?
“This glowing coverage failed to reckon with the full picture of layoffs, which includes
an invisible workforce of contractors locked out from accessing those benefits.”
Unlike full-time employees, contract workers aren’t entitled to Airbnb’s premium
health care, generous 401(k), unlimited paid vacation time, transportation coverage,
and stock options.
1. the ratio for communicating with contractors was more like 1:500
2. After the layoffs the agency refused to pay out sick days that contractors earned
but did not use
3. “After termination, I received one week’s pay, less than 7 percent of what laid off
employees were offered. ”
4. Eleven days later, I received an email from cofounder Joe Gebbia that called this
offer a “modest fund.” Did he mean … severance? Nearly a month later, the
company announced a “relief fund” with a $3,000 cap per person. Laid off
contractors needed to submit an application with itemized expenses (rent, child
care, etc.) in order to be considered. The application process is so cumbersome
that Airbnb created a lengthy “how to” document to guide applicants.
5. “They talked a lot about diversity and belonging, but we [contractors] weren’t
even able to ask questions during the company’s weekly Q&A,” says a former
contractor, “It was like we didn’t have a voice. We were never equal."
74

7. Creativity in Decision Making

Describe the Three-Stage Model
of Creativity
• Creativity is the ability to produce novel and useful ideas.
These are ideas that are different from what has been done
before, but that are also appropriate to the problem.
Exhibit 6-5 Three-Stage Model of Creativity in Organizations

Creative Behavior
Creative behavior occurs in four steps, each of which leads to the next:
• 1. Problem formulation.
– We identify a problem or opportunity that requires a solution that is yet unknown.
– For example, artist/entrepreneur Marshall Carbee and businessperson John
Bennett founded Eco Safety Products after discovering that even paints declared
safe by the Environmental Protection Agency (EPA) emit hazardous chemical
compounds. Thus, Bennett’s development of artist-safe soy-based paint began
with identifying a safety problem with paints currently on the market
• 2. Information gathering.
– Information gathering leads us to identifying innovation opportunities.
– Niklas Laninge of Hoa’s Tool Shop, a Stockholm-based company that helps
organizations become more innovative, argues that creative information gathering
means thinking beyond usual routines and comfort zones.
– For example, have lunch with someone outside your field to discuss the problem.
“It’s so easy, and you’re forced to speak about your business and the things that
you want to accomplish in new terms. You can’t use buzzwords because people
don’t know what you mean,” Laninge says.

Creative Behavior
• 3. Idea generation.
– Idea generation is the process of creative behavior in which we develop possible
solutions to a problem from relevant information and knowledge. Sometimes we
do this alone, when tricks like taking a walk and doodling can jump-start the
process. Increasingly, though, idea generation is collaborative.
– For example, when NASA engineers developed the idea for landing a spacecraft
on Mars, they did so collaboratively. Before coming up with the Curiosity—an
SUV-sized rover that lands on Mars from a sky crane—the team spent three days
scribbling potential ideas on whiteboards.
• 4. Finally, it’s time to choose from the ideas we have generated.
– Thus, idea evaluation is the process of creative behavior in which we evaluate
potential solutions to identify the best one.
– Generally, you want those who evaluate ideas to be different from those who
generate them, to eliminate the obvious biases.
– When Dallas Mavericks owner Mark Cuban was unhappy with the team’s uniforms,
he asked fans to help design and choose the best uniform. Cuban said, “What’s the
best way to come up with creative ideas? You ask for them. So we are going to
crowd source the design and colors of our uniforms.”

Thank you for listening!
Any Questions?

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