11 Decision Making

1. 11 Decision Making People turn to groups when they must solve problems and make decisions. Groups often make better decisions than individuals, for groups can process more information more thoroughly. But groups, like individuals, sometimes make mistakes. When a group sacrifices rationality in its pursuit of unity, the decisions it makes can yield calamitous consequences. • How do groups make decisions? • What problems undermine the effectiveness of deci-sionmaking in groups? • Why do groups make riskier decisions than individuals? • What is groupthink, and how can it be prevented?

3. The mob has no judgment, no discretion, no direction, no discrimination, no consistency. Cicero Madness is the exception in individuals but the rule in groups. Nietzsche When "a 100 clever heads join a group, one big nincompoop is the result.” Carl Jung Decision Making in Groups

4. Making Decisions in Groups: The Pluses and Minuses Why Use Groups? Why Not Use Groups? • more people = more information • more people to do more work • more people means people can do what they are best at • groups can discuss, process information (check for errors, etc.) • groups have standards for deciding (e.g., majority rules) • people are more likely to follow through if part of a group that decided • sometimes the group doesn't recognize the correct answer, even if proposed • groups oversample shared information • sometimes work done by just a few (social loafing) • discussion can be manipulated • groups sometimes make riskier decisions • groups sometimes suffer from groupthink

5. Functional Perspective The ODDI Functional Model of Decision Making

6. Functional Perspective

7. Functional Perspective

8. The key to effective group decision making is the quality of group’s discussion • Bales’sobservations indicate that groups spend the majority of the time during the discussion dealing with suggestions, expressing opinions, and developing a shared orientation to the task.

9. Functional Perspective Social Decision Schemes: How Groups Make Choices • Functional Perspective “Crowdsourcing” as averaging (statistical aggregation)

10. Functional Perspective

11. Vroom’s Model of Decision Making • Functional Perspective • Who Decides?

12. Functional Perspective • Problems and Pitfalls • Group Polarization • Groupthink Group’s are prone to the planning fallacy • Planning to Fail • Orientation Stage • The Difficulty of Discussion • Discussion Stage • The Shared Information Bias • Decision Stage • Cognitive Limitations • Implementa-tion Stage • Dysfunctional Post-decision Processes • Who Decides? Individuals underestimated the time they would need for each phase of the task (planning, analysis, etc.), but groups’ estimates were even less accurate than individual’s.

13. Discussion can be challenging: • Poor discussion skills • Meetings (death by…) • Wasted time (law of triviality) • Muddling through • The Difficulty of Discussion

14. Discussion is rarely equal: most group members’ voices are not heard Percentage

15. Oversampling shared information leads to poorer decisions when a hidden profile would be revealed by considering the unshared information more closely Causes • Informational influence • Normative influence • Emphasis on consensus vs. correctness • Initial preferences • Impression management goals • The Shared Information Bias

16. Reducing the Shared Information Bias The SIB can be reduced by improving information exchange by: • Good leadership • Increasing diversity • Using a GDSS (group decision support system) Discussion

17. Cognitive Limitations

18. Cognitive Limitations

19. Groups do not systematically check their work. Instead, they defend their choices, seeking reassurance rather than effectiveness. • Dysfunctional Post-decision Processes

20. Functional Perspective • Problems and Pitfalls • Group Polarization • Groupthink Groups are not more cautious than individuals: They tend to be riskier! • Decisions Involving Risk • What Causes Group Polarization? • The Consequences of Polarization The Risky Shift Effect

21. Polarization and Risk • Decisions Involving Risk Group polarization: A shift in the direction of greater extremity in individuals' responses

22. What Causes Group Polarization? Risk and Caution are Cultural Values American’s predeliberation judgments Chinese’s predeliberation judgments American’s postdeliberation judgments Chinese’s postdeliberation judgments

23. Functional Perspective • Problems and Pitfalls • Group Polarization • Groupthink • Symptoms of Groupthink • Defective Decision Making • Causes of Groupthink • Emergence of Groupthink • Alternative Models • Preventing Groupthink

24. Symptoms of Groupthink IIrving Janis, in his book Victims of Groupthink, used case study methods to identify the factors that combine to cause a group to make a disastrous decision.

25. Defective Decision Making

26. Causes of Groupthink Research suggests groupthink becomes most likely when cohesion is combined with one or more other causal factors.

27. Janis suggested that groupthink occurs only in cohesive groups—less cohesive groups can make bad decisions, but they cannot experience groupthink. • Emergence of Groupthink

28. Group-centrism: the tendency for groups tend to rush to make judgments on the basis of insufficient information, particularly if they face situations that interfere with their capacity to process information—time pressures, severe ambiguity, noise, or fatigue (Kruglanski 2006). • Ubiquity model: groups commonly groups often strive for consensus and that, in doing so, they tend to limit dissent, denigrate the outgroup, and misjudge their own group’s competence, and these tendencies undermine decision making when • Failure would threat the group’s social identity • Norms constrain open communication • Members lack self-confidence (Baron, 2005) • Alternative Models

29. Janis suggests that, rather than limiting cohesion, groups take alternative steps to minimize the possibility of groupthink. • Preventing Groupthink