Decision Making and Creativity

Decision Making at Rising Sun Courtesy of Rising Sun Pictures Rising Sun Pictures and other computer graphics firms in Australia and New Zealand emphasise creative decision making and employee involvement.

Decision Making Defined Courtesy of Rising Sun Pictures Conscious process of making choices among one or more alternatives with the intention of moving toward some desired state of affairs.

Rational Choice Decision Process

Problem Identification Process Problems and opportunities are not announced or pre-defined need to interpret ambiguous information Problem identification uses both logical analysis and unconscious emotional reaction during perceptual process need to pay attention to both logic and emotional reaction in problem identification

Famous Missed Opportunities A famous missed opportunity for many Hollywood studios: Nia Vardalos’s comedy screenplay about her Greek- Canadian family was rejected by almost everyone, yet it eventually became the top- grossing independent film in history and was nominated for an Oscar. CP/Everett Collection

Problem Identification Challenges Influence from others ‘frames’ the situation. Coping mechanisms block out negative information. Opportunities that differ from mental models become missed opportunities. Faulty diagnostic skills Decisiveness short circuits problem identification Defining problems in terms of solutions CP/Everett Collection

Identifying Problems Effectively Be aware of perceptual and diagnostic limitations. Understand mental models. Discuss the situation with colleagues – see different perspectives. CP/Everett Collection

Making Choices: Rational vs OB Views Goals Rational: Clear, compatible, agreed upon OB: Ambiguous, conflicting, lack agreement Processing Information Rational: People can process all information OB: People process only limited information Evaluation Timing Rational: Choices evaluated simultaneously OB: Choices evaluated sequentially more

Making Choices: Rational vs OB (con’t) Standards Rational: Evaluate against absolute standards OB: Evaluate against implicit favourite Info Quality Rational: People rely on factual information OB: Rely on perceptually distorted information Decision Objective Rational: Maximisation – the optimal choice OB: Satisficing – a “good enough” choice

Emotions and Making Choices Emotional marker process forms preferences before we consciously think about choices. Moods and emotions influence the decision process affects vigilance, risk aversion, etc. We “listen in” on our emotions and use that information to make our choices.

Intuitive Decision Making Ability to know when a problem or opportunity exists and select the best course of action without conscious reasoning. Intuition as emotional experience Gut feelings are emotional signals Not all emotional signals are intuition – uses situation specific templates of tacit knowledge Intuition as rapid unconscious analysis Uses action scripts – pre-programmed decision and behaviour routines

Making Choices More Effectively Systematically evaluate alternatives. Balance emotions and rational influences. Scenario planning.

Escalation of Commitment Escalation of commitment occurred when the British government continued funding the Concorde supersonic jet long after it’s lack of commercial viability was apparent. Some scholars refer to escalation of commitment as the “Concorde fallacy”. © Corel Corp. With permission

Escalation of Commitment Causes Self-justification Prospect theory effect Perceptual blinders Closing costs © Corel Corp. With permission

Evaluating Decisions Better Separate decision choosers from evaluators. Establish a preset level to abandon the project. Involve several people in the evaluation process.

Employee Involvement Defined The degree to which employees influence how their work is organised and carried out. Level of control over decision making Different levels and forms of involvement

Employee Involvement Model Potential Involvement Outcomes Employee Involvement Better problem identification More/better solutions generated Best choice more likely Higher decision commitment Contingencies of Involvement

Contingencies of Involvement Higher employee involvement is better when: Decision Structure Problem is new and complex (i.e non-programmed decision) Knowledge Source Employees have relevant knowledge beyond leader Decision Commitment Employees would lack commitment unless involved Risk of Conflict Norms support firm’s goals Employee agreement likely

Creative Process Model Verification Insight Incubation Preparation

Persistence Cures Peptic Ulcers Many experts doubted Barry Marshall’s (left) and Robin Warren’s (right) claims that peptic ulcers are caused by stomach bacteria. Fortunately, the Australian researchers’ persistence broke through prevailing dogmas and launched a completely different view of ulcer pathology. AFP/Getty Images

Characteristics of Creative People Above average intelligence Persistence Relevant knowledge and experience Inventive thinking style AFP/Getty Images

Creative Work Environments Learning orientation Encourage experimentation Tolerate mistakes Intrinsically motivating work Task significance, autonomy, feedback Open communication and sufficient resources Team competition and time pressure have complex effect on creativity.

Creative Activities Review abandoned projects • Explore the issue with other people Redefine the Problem • Storytelling • Artistic activities • Morphological analysis Associative Play • Diverse teams • Information sessions Internal tradeshows Cross- Pollination

Solutions to Creativity Brainbusters

Double Circle Problem

Nine Dot Problem

Nine Dot Problem Revisited

Word Search FCIRVEEALTETITVEERS

Burning Ropes One hour to burn completely After first rope burned i.e. 30 minutes One hour to burn completely

Chapter 8 Extras

Levels of Employee Involvement High involvement Employees have complete decision making power (e.g. SDWTs) Full consultation Employees offer recommendations (e.g. gain sharing) Selective consultation Employees give information, but don’t know the problem High Medium Low