1. Chapter 17 Decision Making
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

2. Objectives Explain why decision making is a social process
Define and explain how bounded rationality influences decision making
Describe five models of decision making
Explain groupthink and how it can be avoided
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

3. …Objectives Explain how experts make decisions
Identify your personal approach to organizational decision making
Apply the leader-participation model of decision making
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

4. Are Individual Decisions Independent?
Individual decisions are not independent, solitary events
Instead
They are closely connected to previous decisions
And
Are influenced by the social processes that brought the decision point to a head
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

5. …Are Individual Decisions Independent?
Decision making at very high levels
A lonely, individual struggle?
NO! Instead,
It involves information sharing and inter-dependence among organization members
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

6. The Manager’s Role in Decision Making
The manager’s job is to handle the decision process by assessing
The information needed
The players who need to be involved
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

7. Process of Rational Decision Making
1. Recognize and
define problem
5. Evaluate
alternatives
2. Identify decision
objective and criteria
6. Select the best
alternative
3. Allocate weights
to criteria
7. Implement the
decision
4. List and develop
alternatives
8. Evaluate the
decision
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

8. Bounded Rationality - Defined
The theory of bounded rationality maintains that
people are restricted in making decisions and
settle for less than ideal solutions
They satisfice, selecting the first alternative that is satisfactory.
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

9. Common Decision Biases
Anchoring and adjusting
Representativeness
Availability
Overconfidence
Bounded awareness
Emotional involvement
Self-serving reasoning
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

10. Garbage Can Model Factors: Problems Participants Solutions
Choice opportunities
Above factors float randomly inside the organization and if they connect, a decision results
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

11. Choice Shift
Occurs when groups make more extreme decisions than individuals
Risky shift
People support riskier decisions in a group setting than they would individually
Cautious shift
The group decision is more conservative than individual positions
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

12. Groupthink - Defined
Groupthink is the tendency for members of a highly cohesive group to seek consensus so strongly that they fail to do a realistic appraisal of other possibly better alternatives
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

13. Traditional Groupthink Model
Antecedent Conditions
Cohesion
Insulation
Directive leadership
High stress & low esteem & low hope of finding solution
Limited search and appraisal
Groupthink Symptoms
Self-censorship
Pressure on dissenters
Pressure toward uniformity
Illusion of unanimity
Illusion of invulnerability
Belief in inherent morality
Collective rationalization
Outgroup stereotyping
Defective Decision Making Symptoms
Poor information search
Selective information processing
Failure to appraise risks
Incomplete survey of alternatives and solutions
Defective
Decisions
Consensus seeking
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

14. How to Avoid Groupthink
Encourage all members to express their doubts
Assign a devil’s advocate
Adopt the perspectives of other constituencies
Bring in qualified outsiders to discuss decisions
“Sleep” on a tentative decision and have a second chance meeting
Leaders should listen to others’ opinions first
Leaders should demonstrate willingness to be criticized
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

15. Escalation of Commitment
Occurs when people continue to commit resources to a failing course of action
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

16. Leader-Participation Model
Contingency theory of leadership
Continuum of leadership styles ranges from autocratic to participative styles
Decide
Consult individuals and groups
Facilitate
Delegate
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

17. …Leader-Participation Model
Choice of leadership style can affect outcomes of the decision-making process
Decision
Quality
Decision
Implementation
Cost of
Decision Making
Development
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

18. Seven Questions for Managers to Ask about a Decision
Team
Competence
Decision
Significance ?
Group
Expertise
Importance of
Commitment
Refer students to Exhibit 17-4 in the workbook so they can view the decision tree.
Group Support for Objectives
Leader’s
Expertise
Likelihood of
Commitment
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

19. Types of Problems Structured Problems Repetitive, routine problems for
which definite procedures have
been developed
Unstructured Problems
Novel, infrequent and / or complex problems
for which no procedures have been
developed
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

20. Intuition - Defined
Intuition is a cognitive conclusion based on a decision maker’s previous experiences and emotional inputs
Thus, intuition and rational analysis are complementary aspects of good decision making
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

21. The Zone of Indifference
The range within which each person in which he or she willingly accepts orders without consciously questioning authority
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

22. Recognition Primed Decision (RPD) Model
Components of the Model
Cue recognition and pattern matching
Action script activation
Mental simulation driven by mental models
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

23. Klein’s RPD Model generates Situation Cues to affect the Mental
Simulations
to affect the
using your
that let
you
recognize
Mental
Models
which you
assess by
Patterns
Action
Scripts
that
activate
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner

24. PreMortem Exercises Stage Activity
1. Preparation
Review the plan
2. Imagine a fiasco
Imagine causes of failures
3. Generate reasons for failure
Individuals write down reasons for failures
4. Consolidate the lists
Individuals take turns listing reasons
5. Revisit the plan
Address issues of major concern; schedule additional meeting
6. Review the list
Periodically revisit the list of reasons for failure
Designed to expose vulnerabilities in planning
Organizational Behavior : An Experiential Approach 8/E
Joyce S. Osland, David A. Kolb, Irwin M. Rubin and Marlene E. Turner