Learning and Decision Making

1. Learning and Decision Making 8

2. Learning Goals • What is learning, and how does it affect decision making? • What types of knowledge can employees gain as they learn and build expertise? • What are the methods by which employees learn in organizations? • What two methods can employees use to make decisions?

3. Learning Goals, Cont’d • What decision-making problems can prevent employees from translating their learning into accurate decisions? • How does learning affect job performance and organizational commitment? • What steps can organizations take to foster learning?

4. Learning and Decision Making • Learningreflects relatively permanent changes in an employee’s knowledge or skill that result from experience. • Decision makingrefers to the process of generating and choosing from a set of alternatives to solve a problem. • Expertiserefers to the knowledge and skills that distinguish experts from novices and less experienced people.

5. Types of Knowledge • Explicit knowledgeis the kind of information you are likely to think about when you picture someone sitting down at a desk to learn. • Tacit knowledge is what employees can typically learn only through experience. • Up to 90 percent of the knowledge contained in organizations is tacit in form.

6. Table 8-1 Characteristics of Explicit and Tacit Knowledge

7. Figure 8-1 Methods of Learning • We learn through reinforcement, observation, and experience. • Operant conditioning says that we learn by observing the link between our voluntary behavior and the consequences that follow it.

8. Contingencies of Reinforcement Two contingencies used to increase desired behaviors: • Positive reinforcementoccurs when a positive outcome follows a desired behavior • Most common type of reinforcement • Increased pay, promotion • Negative reinforcementoccurs when an unwanted outcome is removed following a desired behavior. • Perform a task to not get yelled at

9. Contingencies of Reinforcement, cont’d Two contingencies used to decrease undesired behaviors: • Punishmentoccurs when an unwanted outcome follows an unwanted behavior. • Suspension, firing • Extinctionoccurs when there is no consequence following an unwanted behavior. • Stop laughing at off-color jokes Positive reinforcement and extinction should be the most common forms of reinforcement used by managers to create learning among their employees.

10. Figure 8-2 Contingencies of Reinforcement, Cont’d

11. Schedules of Reinforcement • Continuous reinforcement • Simplest schedule of reinforcement • Consequence follows each and every occurrence of a desired behavior • Fixed interval schedule • Rewards occur after a certain amount of time • Length of time between reinforcement periods stays the same

12. Schedules of Reinforcement, Cont’d • Variable interval schedules • Reinforce behavior at random points in time • Fixed ratio schedules • Reinforce behaviors after a certain number of them have been exhibited • Variable ratio schedules • Reward people after a varying number of exhibited behaviors

13. Table 8-2 Schedules of Reinforcement

14. Learning Through Observation • Social learning theory • People in organizations have the ability to learn through the observation of others • Behavioral modeling • People observe the actions of others, learn from what they observe, and then repeat the observed behavior.

15. Goal Orientation • Learning orientation • Building competence is more important than demonstrating competence • Enjoy working on new kinds of tasks, even if they fail during early experiences. • Failure viewed in positive terms—as a means of increasing knowledge and skills in the long run • Performance-prove orientation • Focus on demonstrating competence so that others think favorably of them • Performance-avoid orientation • Focus on demonstrating competence so that others will not think poorly of them

16. Methods of Decision Making • Programmed decisions • Somewhat automatic • Person’s knowledge allows him or her to recognize and identify a situation and the course of action needed • Intuition • Emotionally charged judgments • Arise through quick, nonconscious, and holistic associations • Important during a crisis • A crisis situationis a change—whether sudden or evolving—that results in an urgent problem that must be addressed immediately

17. Methods of Decision Making, cont’d • Nonprogrammed decisions • Called for when a situation is new, complex, and not recognized • Become more common as ascend the corporate hierarchy • Rational decision-making model • Offers a step-by-step approach to making decisions • Maximizes outcomes by examining all available alternatives

18. Decision-Making Problems • Limited Information • Bounded rationality • Satisficing • Faulty Perceptions • Selective perception • Projection bias • Social identity theory • Stereotyping

19. Table 8-3 Rational Decision Making vs. Bounded Rationality

20. Decision-Making Problems, cont’d • Heuristics • Simple, efficient rules of thumb that allow us to make decisions more easily • Decision biases • Availability bias • Framing • Representativeness • Anchoring • Contrast • Recency

21. Decision-Making Problems, cont’d • Faulty Attributions • Fundamental attribution error • Self-serving bias

22. Attribution Process • Consensus: Did others act the same way under similar situations? • Distinctiveness: Does this person tend to act differently in other circumstances? • Consistency: Does this person always do this when performing this task? • An internal attribution will occur if there is low consensus, low distinctiveness, and high consistency. • An external attribution will occur if there is high consensus, high distinctiveness, and low consistency.

23. Decision-Making Problems, cont’d • Escalation of commitment • Decision to continue to follow a failing course of action • People have a tendency, when presented with a series of decisions, to escalate their commitment to previous decisions, even in the face of obvious failures

24. Effects of Learning • Moderately correlated with job performance • Weakly related to organizational commitment • Higher levels of job knowledge associated with slight increases in emotional attachment to the firm

25. Application: Training • Trainingrepresents a systematic effort by organizations to facilitate the learning of job-related knowledge and behavior. • Organizations spent $134.39 billion on employee learning and development in 2007, or $1,103 per employee. • Knowledge transferis the transfer of knowledge from older, experienced workers to younger or newer employees.

26. Knowledge Transfer • Behavior modeling • Ensures employees have the ability to observe and learn from those with significant amounts of tacit knowledge • Communities of practice • Groups of employees who work together and learn from one another by collaborating over an extended period of time • Transfer of training • Knowledge, skills, and behaviors used on the job are maintained by the learner once training ends • Generalized to the workplace once the learner returns to the job • Transfer of training can be fostered if organizations create a climate for transfer—an environment that supports the use of new skills.