SCO 404 Perception N Decision Making 2

How does perception affect our decision making?

1. Selective Perception: people selectively interpret what they see on the basis of their interest,
background, experience, and attitudes. This factor allow people to speed-read others but not
without the risk of drawing an in accurate picture. Hence, people's decision will be impaired by
wrong perception.

What is the role of perception in individuals’ decision making process?

Perception plays a vital role in the decision making process. Therefore, decision makers often
use perception to create, evaluate, and choose decision options. ... Perception is often based on
assumptions attributed by one's personal characteristics. Various factors can influence one's
perception.

What is entrepreneurial decision process?

The Entrepreneurial Decision Process is a natural and logical approach which helps
individuals to achieve success in new ventures. Most of the individuals have innovative and
creative ideas. Some of them recognize the opportunity to bring their ideas in the market and
start a new venture.

How does perception affect behavior?

Perception itself will influence our personality. Nonetheless, personality and will on the one
hand and perceived situation on the other are clearly distinct. And the direction of our behavior
depends on the relationship between these distinct aspects of our psychological field.

Why perception and decision making are important in understanding human behavior at the
workplace?

Therefore, to influence productivity, it is necessary for employers to assess how workers

perceive their jobs. Likewise, absenteeism, turnover and job satisfaction have more to do with an
employee's perception of the job. ... Consequently, perception influences decision-making
within an organization.

What are the five steps in the decision making process?

1. Step 1: Identify the decision. You realize that you need to make a decision.
2. Step 2: Gather relevant information.
3. Step 3: Identify the alternatives.

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 4. Step 4: Weigh the evidence.
5. Step 5: Choose among alternatives.
6. Step 6: Take action.
7. Step 7: Review your decision & its consequences.

What are the 4 entrepreneurial process?

The entrepreneurial process has four distinct phases: (1) identification and evaluation of the
opportunity, (2) development of the business plan, (3) determination and evaluation of resource
requirements

What are the six steps in the entrepreneurial process?

The six steps are as follows:

1. Idea Certainty.
2. Business Idea.
3. Business Concept.
4. Venture.
5. Business.
6. Sustainable Business.

What is the link between perception and decision making?

Ideally, decision making would be an objective process, but the way individuals make
decisions and the quality of their choices are largely influenced by their perceptions. Individual
decision making is an important factor of behavior at all levels of an organization. Decision
making occurs as a reaction to a problem.

NOTE:

How can perception affects the decision making process?

Because people’s behavior is based on their perception of what reality is, not on reality itself, it
is possible that two persons can see the same thing and interpret it differently.

Based on the above, the following are some factors that affect perception and hence, it affects
decision making process:

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1. Selective Perception: people selectively interpret what they see on the basis of their interest,
background, experience, and attitudes. This factor allow people to speed-read others but not
without the risk of drawing an in accurate picture. Hence, people’s decision will be impaired by
wrong perception.

2. Halo (Horns) Effect: people are drawing a general impression about an individual on the basis
of a single characteristic. This will negatively affect their decisions.

3. Contrast Effects: it is evaluations of a person’s characteristics that are affected by comparisons

with other people recently encountered who rank higher or lower on the same characteristics.
This factor also affects decisions quality.

4. Stereotyping: it is judging someone on the basis of one’s perception of the group to which that
person belongs.

People rely on generalizations every day because they help them make decisions quickly. They
are a means of simplifying a complex world. This will affect decision making process.

5. Rationality: people are usually content to find an acceptable or reasonable solution to a

problem rather than an optimal one.

The process of making decisions using rationality rather than a defined prescriptive model in not
effective enough in taking the best decision.

6. Bounded Rationality: individuals make decisions by constructing simplified models that

extract the essential features from problems without capturing all their complexity.

So, people seek decisions that are satisfactory and sufficient. They tend to choose the first
acceptable solution encountered rather than the optimal one. This may not ensure the best
decisions.

7.Intuitive Decision Making: intuition is often used when there is a high level of uncertainty,
there is little precedent to go on, when the variable in question are less predictable, when facts
are limited, these facts don’t lead you in one particular direction, data is of little use, when there
are several plausible choices, and there is time pressure.

It may be used in decision making process when all given factors are ambiguous.

8. Overconfidence Bias: we tend to be overly optimistic especially when our intellect and
interpersonal abilities are low. This wrong perception will lead to wrong decisions.

9. Anchoring Bias: it is the tendency to focus on initial information as a starting point. This
occurs because our mind appears to a disproportionate amount of emphasis to the first
information it receives. This results in not to take the optimal decisions.

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10. Confirmation Bias: we tend to selectively seek out information that reaffirms our past
choices and we discount information that contradicts our past judgments. This could happen even
if we are not sure that this is the optimal choice.

11. Availability Bias: the tendency of people to base their judgments on information readily
available to them whatever this information is enough to make the best decisions or not.

12. Representative Bias: the tendency to assess the likelihood of an occurrence by drawing
analogies and seeing identical situations in which they don’t exist. This will lead to make the
decisions on a very weak base.

13. Escalation of Commitment: an increased commitment to a previous decision in spite of

negative information which is often creeps into decision making process.

14. Randomness Error: we tend to create meaning out of random events which is not enough to
ensure the optimal decision making process.

15. Hindsight Bias: we tend to believe falsely that we would have accurately predicted the
outcome of an event, after that outcome is actually known. This will confirm the situation even if
we believe that it was a wrong decision.

16. Personality: many personal characters like conscientiousness and self-esteem may affect
perception and hence, affect decision making process.

17. Gender: women tend to analyze decisions more than men. Women tend to analyze a decision
prior to and after the fact.

This difference in length of thinking in problems will lead to more accuracy in making decisions
as well as much time consumed for taking a decision by women.

18. Cultural Differences: there are differences in what problems to focus on, the depth of
analysis, importance of logic and rationality, and preference for individual vs. group decision
making.

* Practical examples clarifying perception effects on decision making:

1. Employment interview: Early impressions are very effective and important. Perceptual
judgments are often inaccurate and may lead to inaccurate decisions in selecting candidates to be
hired.

2. Performance Expectations: People attempt to validate their perceptions of reality, even when
they are faulty.

A situation in which a person inaccurately perceives a second person and the resulting
expectations cause the second person to behave in ways consistent with the original perception.

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This will lead to misunderstanding in actual intensions of the two persons and hinder their
communication.

3. Performance Evaluations: many subjective components (perceptions) are used in the

evaluation of employees. This will affect decisions taken in performance appraisal procedures in
organizations.

4. Employee Effort: how is effort perceived is often a reason for terminations. Managers may
tend to perceive the effort of their employees is not enough as they expect. This is depending on
the managers’ perceptions.

Why perception and decision making are important in understanding human behavior at the
workplace?

Therefore, to influence productivity, it is necessary for employers to assess how workers

perceive their jobs. Likewise, absenteeism, turnover and job satisfaction have more to do with an
employee's perception of the job. ... Consequently, perception influences decision-making
within an organization.

NOTE:

Workplace organizational behavior part II: Perception

In a previous post, I discussed the definition of workplace organizational behavior and how
certain individual-level variables—including personality, ability and learning—affect
productivity, absenteeism, and turnover and job satisfaction.

In this lesson, let’s examine how one’s perception influences productivity, absenteeism, turnover
and job satisfaction.

What is perception?

Perception is the process by which individuals organize and interpret their sensory impressions
in order to give meaning to their environment.

What one perceives can be substantially different from what another person perceives, and both
can be very different than the actual objective reality.

In fact, behavior is based on one’s perception of what reality is, not reality itself.

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Why is perception important in the workplace?

Behavior in the workplace is based on people’s perception of the workplace. There are many
factors that influence how something is perceived.

Factors pertaining to the perceiver can involve the person’s attitudes, motives, interests,
experience and expectations. Contextual factors can involve time, work setting and social setting.

Finally, factors related to the actual target can involve novelty, motion, sounds, size, background
and proximity.

But what does perception have to do with employment?

Well, there are various ways that a person can perceive a situation in the work environment that
can lead to problems. For example, the following can occur among employees in the workplace
on a daily basis:

 Fundamental attribution error: The tendency to underestimate the influence of

external factors and overestimate the influence of internal factors when making
judgments about the behavior of others
 Self-serving bias: The tendency to attribute one’s own successes to internal factors and
blame one’s own failures on external factors
 Selective perception: The tendency to selectively interpret what is seen based on one’s
interests, background, experience and attitudes
 Projection: The tendency to attribute one’s own characteristics to other people
 Stereotyping: The tendency to judge someone on the basis of the perception of a group
to which that person belongs
 Halo effect: The tendency to draw a general impression about an individual based on a
single characteristic

Examples of perception in the workplace

1. As you can imagine, the way a person perceives a job applicant during an interview can
affect an organization. For example, interviewers may like one aspect of the interviewee
and—pursuant to the halo effect—assume that person is entirely a good fit with the
company. Or, interviewers may learn they have one thing in common with the
interviewee and project that they are similar to the candidate in every way, making a
good fit for the organization.
2. An employee may not get a promotion because an employer has formed a negative
impression about the employee simply because that person belongs to a particular
religious group. This is stereotyping, and is clearly contrary to human rights legislation.
However, given human nature’s tendency to gather things and people into groups and
make general impressions, this can occur more often than one might think. First
Reference offers a helpful free whitepaper detailing the organizational need for a
thorough anti-discrimination policy in your employment manual—along with several
other HR policies that are essential for legal compliance and due diligence.

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 3. An employee may be considered disloyal or not putting enough effort into a project.
These characteristics are subjectively judged based on an employer’s perceptions. For
instance, one supervisor may selectively perceive an employee to be loyal, while another
supervisor may selectively perceive that same employee to be too conforming and
insincere.

What effect does perception have on employees and the workplace?

In terms of perceptions, research has shown that what employees perceive from their work
situation influences their productivity most.

Therefore, to influence productivity, it is necessary for employers to assess how workers

perceive their jobs.

Likewise, absenteeism, turnover and job satisfaction have more to do with an employee’s
perception of the job.

Those individuals who perceive their jobs as negative are likely to have increased absenteeism,
more frequent turnover and less job satisfaction. The only way to influence these variables is to
understand how an employee subjectively perceives the workplace.

Consequently, perception influences decision-making within an organization. Take the example

of the interview.

Within the first few minutes of the interview, the interviewer has learned some information about
the interviewee and has formed an impression based on various perceptions.

The interviewer then decides whether the candidate is a good fit with the company. The
remaining time in the interview is typically spent asking select information that supports the
initial decision.

Takeaways – managing our perceptions at work

Though we are all human and have a background and a particular perspective on which we rely
when perceiving things in the work setting, it is important to be aware of the various factors that
influence our perceptions, especially when making important decisions that affect the
organization.

Sometimes it is a good idea to have a few decision makers provide an opinion when making big
decisions to ensure that various perceptions are considered before taking the plunge. It’s also
very helpful to have written workplace policies and procedures in place to ensure that reduce the
likelihood help narrow the gap between perception and reality. Such policies help ensure
management and employees act fairly and consistently, thus reducing the risk of discrimination
and human rights violations, among other problems.