Perceptions in Decision Making

Perception is a process that all people take part in as we move through the course of events in our daily lives. When we meet people, make business decisions, evaluate performances, or pass judgments, our perception surrounding such events help persuade our next course of direction (Goldstein, 2006). In a sense, perception, accurate or flawed, is our reality. Robbins (2005) defines perception as a process that individuals go through, influenced by surrounding stimuli and sensory impressions, to define their surrounding environment. Causes that shape or distort our perceptions have a tremendous effect on the impact of an organization's behavior. Individuals, by nature, develop perceptive shortcuts when passing judgment and inflect both positive and negative effects. In exploring perception, we can see how decisions are made in real world organizations and how these perceptions shape ethical and moral decisions.

Organizational Impact from Perception

A person's perception of others is developed initially by visual cues, statements made by others, or by characteristics surrounding personal behavior (Goldstien, 2006). When developing perception of others, one first develops a judgment surrounding internal and external factors influencing an individual. For example, one might infer that the homeless man on the corner has had made poor decisions in life, has a substance abuse problem, or is a con-artist (internal factors). However, one might also infer that the homeless man has an untreated mental illness, was abandoned as a child, or has been dealt a bad hand in life (external factors).

Robbins (2005) gives three types of applications that define the development of personal perception; the arbitration theory, fundamental attribution error, and self-serving bias. The arbitration theory tells us that when individuals observe behavior, they will define whether these behaviors or a result of external or internal factors (Robbins). For example, when managers in an organization have to deal with poor performance issues from employees, they can make disciplinary decisions based on external or internal factors influencing the behavior. Has the employee been ill? Is the employee moonlighting? Does the employee have a history of poor performance?

The fundamental attribution error is defined as underestimating external factors surrounding behavior and inflating any internal factors when casting judgment (Robbins, 2005). An example of this can be seen when low production numbers is attributed to a perceived unhappy workforce and no consideration is made to a shortage in material provided to the workforce. Following this same line of perception, the self-serving bias attributes all success to individual's internal factors and shuffles all failures to any external factors (Robbins). As we can see by these examples, the way we perceive others and the actions taken based on these perceptions, can impact the decision making process of an organization in various was.

Positive and Negative Effects of Perceptive Shortcuts

Perceptive shortcuts such as stereotyping, projection, and the halo effect can have both positive and negative effects in the decision making process. For example, we could infer that all college graduates are hardworking, ambitious, motivated, and candidates for advancement. This status does not indicate that this is true for all individuals, but can positively effect our decision making process. However, assuming that without a college education one could not have the same characteristics, this could have a negative effect on the decision making process.

In the projection perceptive shortcut, one assumes that their own characteristics also belong to others (Robbins, 2005). In this case, one can assume that all other employees are as honest as themselves and lax on security protocols. The halo effect defines an individual based on a single characteristic (Robins). An example of this can be seen when managers assume that ambitious and outgoing sales individuals will be high producers. While taking these perceptive shortcuts we can make speed decisions based on perceived characteristics of individuals. Statistically, managers may find that these perceptive shortcuts more than likely have positive effects, but they also need to understand that generalizations based from these methods can produce inaccurate assumptions (Goldstien, 2006).

Real World Decision Making

Because organizations understand that decisions can be based on perceptions of individuals, influenced by upbringing, beliefs, or current state of mind; models are developed to guide individuals through the process. The creation of these models creates a standard that is followed to deliver a satisfactory result. These models Identify a need, create a process to determine what qualifications will satisfy the need, Identify matches to the need, then a decision is made on what match best suites the need. These models are not a perfect solution to the decision making process. Errors and bias still creep in to this process through the use of intuition, gut feelings, experience, and impulse (Robbins, 2005).

In addition, these models cannot account for perceptions made that shape moral and ethical decisions. This can be seen in the decisions that are made by managers based upon what is perceived to be the most satisfactory result. For instance, a manager who has made a decision based on what is conceived to be best for the greatest number of people would come from a utilitarian criterion (Robbins, 2005). Other forms of ethical and moral perceptions focus on rights of the individual and social justice. Seemingly, one could view these examples of perceptions as political views. However, these representations, as they may belong to the fundamental floor of a political group, are shaped by the individual perception of each individual. Any form of ethical decision making, right or wrong, can result in unsatisfactory feedback from individuals who come from a different form of perceptive thought.

Perceptions play a vital role in the decision making process. As we have seen, perceptions can have both positive and negative uses. Organizations, try to circumvent perceptive errors through the use of relational models. However, even with the use of relational models, errors and bias can still play a role in the decision making process. This perception can shape decisions made by what individual feel is the best ethical or moral solution.

References:

Goldstien, E. B. (2006). Sensation and Perception (7th ed.). New York: Wadsworth.

Robbins, S. P. (2005). Peception and Individual Decision Making. In Organizational behavior (11th ed., pp. 132-167). Upper Saddle River, NJ: Pearson Education.