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Link between Perception & Individual Decision Making

Link between Perception & Individual Decision Making. Decisions: The choice made from among two or more alternatives. Problem: a discrepancy between some current state of affairs and some desired state. Every Decision needs: Interpretation. Evaluation of information.

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Link between Perception & Individual Decision Making

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  1. Link between Perception & Individual Decision Making • Decisions: The choice made from among two or more alternatives. • Problem: a discrepancy between some current state of affairs and some desired state. • Every Decision needs: • Interpretation. • Evaluation of information.

  2. How should a decision be made? • Rational: Making consistent, value maximizing choices within specified constraints. Rational Decision Making Model

  3. Creativity Ability to produce novel and useful ideas • Creative Potential found: • Intelligent people. • Independence. • Self confidence. • Risk taking • Internal locus of control • Tolerance for ambiguity. • Perseverance in the face of frustration.

  4. Three component model of creativity • Creativity

  5. Decision Making in Organizations Bounded Rationality: Making decisions by constructing simplified models that extract the essential features from problems without capturing all their complexity. Intuition: An unconscious process created out of distilled experience. Cultural Differences: based on background, beliefs. Individual differences: Personality and gender.

  6. Common Biases and errors • Decision makers engage in bounded rationality. • Are attempts to shortcut the decision process.

  7. Organizational Constraints: Ethics in decision making • Three Ethical Decision Criteria: • Utilitarianism: decisions made greatest good for greatest number. • Rights: respecting and protecting basic rights of individual. • Justice: equal distribution of benefits and costs. • Ethics & National Culture.

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